This content was created by Michelle Zatlyn. This content was uploaded by Michelle Zatlyn. This is a YouTube interview/talk titled "Setting customer expectations | Michelle Zatlyn (Co-founder and COO of Cloudflare)" (recorded January 28, 2026). The excerpt is an English conversation between Michelle Zatlyn and an interviewer (Speaker B) during a Techto community event. Michelle gives practical advice on setting customer expectations across product stages (private beta to paid enterprise), the importance of signaling product maturity to early adopters, taking a long-term focus on retention and expansion, and shares a real anecdote about deferring a multimillion-dollar customer until the company was ready, later signing them 18 months afterward.
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I think it's better to set expectations in the sense of knowing that it's early or private beta or whatever you're going to call it, beta alpha, so that they know that there might be bugs. Because like, let's face it, building software takes time. So there are going to be bugs. And it's better, in my opinion, early on if customers know and there's so many that will raise their hand to be part of it. They want to be early adopters of something new and cool and they actually probably want to even help you find the bug and that maybe even why they're signing up. It's hey, we want to be an initial user so we can give you feedback so you build to what we need over time if they're a larger organization. And so I think setting some of that expectations up front can be a huge advantage. One of the things, I'll give you a story that happened later on, but just like where we really walked in the shoes. So we started developers, small businesses, we had a lot of them. Their expectations were, you know, if we kind of were a little wonky or found some bugs they were more willing to, to be, to help us fix through it. It was great. Over time we went, we got larger and larger customers and it turns out when someone's paying you $50,000 a year, their expectations are higher than someone paying you 20amonth. Makes sense. And that then at some point this is a true story. This is what happened. Again, this was further along, but just to give folks this idea of like set expectations, in my opinion is better. I think is a good again, you're in this for the long term. We've been building Cloudflare for 10 years. It's a long term, it's not this year. It's a long term. Take a long term focus to this great business you're building because you've got awesome technology. And so a couple years down the road, so early on was we had this private beta, so people expected it to break and they wanted feedback. So that was good. Then you come out of that and then people have higher expectations and the more money they pay you, the more expectations they have. So this is what was a real life story. At some point we had one of our salespeople was so excited, they were about to sign a multimillion dollar deal. And it was like. And his boss Chris, who I told earlier, this executive, was thrilled. He wanted to sign multimillion dollar deals too. It was like a big moment for the company. And they came and told Matthew and I, the great news. And Matthew and I said, no, we can't take that customer. And they're like what? And at the end of the day it's like, no, no. A multimillion dollar customer is going to have a very different expectation than where we were at. And we didn company was ready for it and we kind of said we're not ready for that. We are going to not meet their expectation and back to retention and expansion. Like the metrics that matter where like a customer who's unhappy and leaves after a year is actually not good for us because not only that, we're going to miss the chance for them. They're going to tell all their friends, everyone knows each other. They're going to tell everyone that we're not reliable. So they were really upset. Our salesperson and our head of sales was really upset. They did not like the decision.
But were you able to build the product to a point where you could confidently bring that client on?
Yeah, well, exactly what happened? So we went back to the customer and it was, hey, we're not ready for you right now, but let's stay in touch, we're going to be ready for you. And 18 months later they did sign up and they were happy customer for many years. And so I think that we will always have taken a really long term focus to the business. You build something that's going to be a long run for a long time. And so take customers today, revenue matters, but not break the organization. Then I think almost going back and saying we're not ready, let's stay in touch, we'll come back in six months or 12 months or 18 months. You'd be amazed at how much people are like, wow, thanks for being honest about that. And they will come back and they will. And again then you have a really high retention rate for customers which again is one of the four metrics that matter a lot for SaaS businesses.
Amazing. Michelle, this was just super cool. Thank you so much. Thanks for hanging with us. Thanks for sharing your insights. Just like a really huge thank you from everyone who's hanging out at today's event, but also just the entire Techto community for taking the time to share your story, your insights with us tonight. Thanks Michelle.
Thanks so much for having me and I'm rooting for all your success and I hope you like feel like, wow, Michelle can do it. So can I and I can't wait to see what you all build.
