How we used Customer Support to build $9m Bootstrapped

guys please help give me a warm welcome and Round of Applause to John from Excel events John awesome thanks Nathan hey everyone I'm John Kazarian founder of excel events today we're going to be chatting about how we used our customer experience team to bootstrap to a 9 million dollar run rate but before I get there I want to get into a little bit more of how the company actually came to and what we do so we facilitate events

like this one but both in person and virtual experience as well as webinars we work with companies like vidyard and zapier to facilitate their product launches their Customer Events again you name it so I actually started the business in 2015 and it sort of spun out of necessity in uh in 2014 my cousin at the age of 17 got diagnosed with cancer and I wanted to do something for her and ultimately realized that I could raise

the most money through hosting an event so I uh I was 24 at the time I was living in Boston I went down to the aquarium and I put my credit card down and rented out the entire aquarium and uh I've realized that I had to sell 185 tickets in order to break even so started marketing this event putting it together pulling Tech together to pull it off as well and on the day of the event the platform we were using for registration failed us you could not

check out on mobile and we had about 100 people on our wait list that were unable to get in fortunately you know we did we did sell 840 tickets so uh my credit could score it didn't drop but um I just realized that like technology needs to be there to make life easier for event organizers not harder you know you spend so much time putting this experience together there's so many stressors if we as a company can find a way just to help somebody get an extra 15 minutes of sleep the night before their event then frankly we're winning

so you know after this this unfortunate experience with the vendor we were using and realizing that we needed to find other technology to help facilitate the event and end up building out something to use for this first event and frankly it just it worked we got great feedback from the attendees from the organization that we put the event on and from there my buddy and I we decided to build a business around this so for the first uh four to five years here we were both working full-time in building this

business nights and weekends and you know again from being in that experience where something broke we couldn't get a hold of anybody we just didn't want to put anybody else in that you know that situation that that situation that we had felt so what was so clear to us was that we need to be available for whatever our customers might need and it was going through this period being bootstrapped we would literally alternate like on date nights with our girlfriends who had

to cover support on a given night and this was like four or five years of that and then you know it was looking like maybe in 2020 you would get to that point where I could go full time we thought we'd be able to get to a million in revenue and then March of 2020 Cam and uh well you all know what happened there but being in the event space every event on the platform was canceled our Revenue our cash flow actually went negative because of all the refunded tickets and at this point I just watched everything

that I had spent the past five years building fall apart just slip between my fingers and I mean it's obviously devastating but there was one Saving Grace and it was that we had this belief that technology was going to play a bigger role in events going forward and we had started to move down this path of building for a hybrid future so at that point I was I was fortunate uh in that I was able to convince my dad to who had just retired to invest 75 grand from his retirement in the

business so we had a chance to stay alive a chance to pursue that that belief we had and we did and uh it worked out pretty well for us we went uh you know from basically zero in Revenue in Mark frankly negative cash flow to ending the year doing 3.3 million in Revenue went on to more than double that again last year so obviously you know a successful uh adoption pivot for us there but the way that we did that was very much through the customer experience team that we

built now I'm sure you know you all read TechCrunch and everything that's going on in the news you saw all the the funding that was taking place for businesses that were benefiting from virtual working just six companies alone raised a cumulative 1.6 billion dollars during that period and there was about 20 other companies that raised Capital at the same period so we're out there against all these companies that are just raising crazy cash but we had this this

belief again that we didn't want to do anything that was going to lead to our NPS dropping to our customer experience suffering because we'd been there before we know what it was like when an event platform when event Tech fails you in the experience that you're putting forward so what we did was we made customer experience our 10x feature now I want to carry that and caveat that and say that that approach that just it doesn't work unless you have a great product as well otherwise you know you

can push a rock over a cliff and it's going to snowball and accelerate as you prove the value of your offering to your customers but you're not going to push it all the way up the hill so uh what we're going to chat about today is how we unlock value for our customers what happened as a result to the business and to our customers and then I'll share a little bit more about what we actually did from the perspective of building that uh building that

infrastructure and org structure so this is um a interesting chart that Scott Brinker from HubSpot published a couple of weeks ago but I think it really hits the nail on the head here so he's talking about markdeck but I think this is applicable across frankly a lot of uh Enterprise Tech it's this idea that the last decade was really focused on SAS as we know it right build it one sold a thousand times but as that's happened technology has

become so robust and so flexible and every company has so many different vendors supporting them that you need to deliver more you need to help your customers to really realize that value so that you get the adoption that you need to mitigate churn and that's what we focused on so we started to ask ourselves okay what does great experience look like for us and given that we had been in this situation before where we weren't able

to get a hold of anybody we wanted to completely change the game on that we wanted to be the event platform that had the fastest and best support out there so we did and today we ensure that our median response time on chat is always less than 30 seconds I'll share some screenshots of that in a moment and the reason for this is this you know you spend months maybe three months building an event experience that culminates often in a couple of hours you don't have time to wait for a response it's not like a CRM where hey

you can come back the next day and it's okay if it's working then no there's a discrete point in time where events take place and everything has to be working properly for them the other aspect of it is that we wanted our customers to really feel like we were an extension of their team and that goes beyond just the way that we're interacting with them but we really wanted to essentially be a solution consultant we wanted to build trust with our customers throughout the early interactions because there was actually

this is a revenue generating channel for us and I'll share a few stats on that in a moment so as we thought about what that meant in terms of unlocking value for our customers there's a couple different aspects once somebody's hit onboarding they're obviously past that sales cycle but now there's actually a new sales cycle taking place that onboarding experience is an opportunity for us to show our customers the value of our Professional Services so that we can actually sell

our professional services to our customers as well and Professional Services for us make up about eight percent of our Revenue but it's actually a profitable channel on its own now another aspect of the way the way the way that we're delivering for our customers is thinking about all of the training and education we're providing so we have a robust knowledge base you know 250 plus articles there we're looking at the C stats of all those articles as well but the other aspect is finding additional Avenues to deliver

not just for our primary stakeholder but for our customers customers so for example in the world of events you have obviously the event organizer the attendees the speakers and the exhibitors so we actually host weekly webinars for the exhibitors and the speakers that are participating on the platform as well and of that we've actually seen that 15 percent of our new business comes from folks who are previously an exhibitor on a customer event on our platform so by getting in

front of those exhibitors and showing them how much value they can generate from themselves through participating in events on the platform when they want to host their own event they naturally turn to us so what we saw as a result of this the CX department on its own was actually operating at a 15 profit margin now the gross margins were a little bit lower as you'd expect but as a business unit on its own it made sense for us to continue to invest in this the other

thing that we saw is our logo churn ended up being a lot lower than that of our uh competitors of the industry averages and then the final aspect is when it came to building this relationship with customers because they knew that we were always there if they messaged us they were going to get a person on the end of that not a bot it led to this environment where people were so much more willing and engaged in telling us about how they're using the platform what we can be doing better what they're

trying to accomplish and it led to a much faster product Innovation cycle and then we also had a direct line of communication between our CX team and our engineering team so that the engineering team would get brought in immediately into every circumstance that warranted it and we could just get things revolved resolved much much faster so thinking about uh you know what else we went through from uh looking at this from a financial perspective we chatted with a lot of VCS over the past two years and when they would start to dig

into some of that financial information they would um they would be looking and say okay well you know eight percent or so of your revenue is is from this Professional Services we don't want to consider that in an evaluation but the reality is yes it was in traditional SAS Revenue but it still had a gross margin that was in line with that of traditional SAS and although it wasn't contractually reoccurring these events every event

would have the same level of service so it was reoccurring in nature and expected and we could forecast off of that so yes maybe VCS didn't love it but for us we knew that it was improving the business we knew it was improving customer outcomes and we knew that it was leading to expansion revenue for us so here's a couple of stats from intercom which is our primary chat tool we um you can see here our median first response time is 25 seconds on that we

have uh between five thousand and ten thousand conversations in a given month that's not messages it's actual full-fledged conversations there's some seasonality in our business so that's where the variability comes in the other thing that you can see here is that with those conversations we're measuring the csat customer satisfaction of each of those different conversations and we're reviewing this not just on a Time basis and looking to see that improve over time but each rep is being evaluated on their individual performance as well and

we look at look at it across different business verticals and uh in customer segments now in order to be able to facilitate five to ten thousand unique conversations a month you obviously need more than one person doing that um so this chart is showing our website visitor traffic growth from uh January 2019 through October of 2020 you can see obviously it's spiked up quite a bit there we had two CX people in March of

2020. by October we had 27. and uh one of those people actually graduated I think with Nathan from Virginia Tech but she's she was promoted four times in a matter of 16 months and is now our our VP of customer experience and I'll talk to you a little bit more about how we really used hiring within as a mechanism for rewarding success so in terms of what we actually did to to build this team

um

to build this team we you know there's a couple of different elements that we've thought about quite a bit let me just all right uh so looking at looking at the organization structure of what we built here now I mentioned hiring within so that person at the top of that uh diagram there was promoted quite frequently and she wasn't the only one we had numerous people who were promoted multiple times but what this showed each other is that that opportunity was there if you stepped up you went above and beyond for the

company for the customer you're going to be recognized for that and that was just one of the mechanisms that we had in place to ensure that people were being recognized for their efforts you can also see here the significance of our CX team as a percentage of our headcount allocation so it made up 27 of our uh of our total headcount marketing was only four percent we only had uh yeah between three and five marketing people throughout the duration of this period we really relied

on that customer experience team as a mechanism to generate Word of Mouth business to ensure each of those event experiences is everything that I possibly could be because each of those attendees on those events were potential customers of ours we wanted to make sure that not just our customer was having a success successful experience but so was the end attendee in each of the other stakeholders that were present so what we did is we made sure that we were compensating

the management of the CX Department in accordance with that and not just the VP but the director level and the CX leads as well so we had a quarterly compensation structure that's tied to NPS in our case given our industry is a little episodic in nature we can't just look at NPS every say three months we look at NPS 10 days before each event occurs and then right after so how do you feel about your event experience leading up to it and then how do you feel about the results of that event and

we use that as a mechanism for proactive engagement with our customers because if we notice anything that frankly anything that's less than 10 we reach out to figure out what we can do to make sure that event is going to be a 10 for that customer all right another thing that this led to was increased in G2 G2 reviews because we're ensuring that each of those experiences are where we want them to be and we're building those deep relationships with the customers in advance of the event it

made it very timely for us to follow up right after we got it NPS you know 10 on an NPS score post event another thing that we you know we invested quite heavily in uh in training everybody on this team and I'll share a little more about the training but we actually compensated the management team on retention of those employees as well now obviously if we needed to let somebody go the management team wouldn't be knocked for that but we want to ensure that we were making this a great experience and that it wasn't something

that was just about the numbers so a couple of ways that we uh that we go about that every week and throughout the week anyone in the company can uh submit an Excel events Ace and you filled a quick form who the person is what they did that went above and beyond for the business for a customer and then you also go through and you associate any of our core values with that at the end of every week our head of talent goes and she posts all

these to a slack Channel where everybody's engaging each other giving each other kudos for it we also host bi-weekly events for our employees on our own platform and that's another opportunity where we share those success so we really take our CX team and we put them on a pedestal we want them to be the hero for our customers it's not an afterthought rcx team is almost a farm team for the rest of the company uh of the you know throughout the duration of the company of the people that have entered that uh that team I think we've had eight that have gone to other

departments within the organization so it's just a great egress to get people in the business get them to know the customers get them trained up on the product and then give them opportunity again to pursue their career Within our organization uh another thing that we do and this is just a small thing but uh every week There's a CX team lead of the week we then again promote that person within the business and we also give them 100 bucks you know it's not huge but it's again an opportunity for us to go and

recognize each of those folks in their contributions to the business so with that um I'm going to wrap up and just you know share a little bit more we we really found a way to make customer experience that 10x feature for us and again it's not going to work if the product's not there but if you've got a great product it's an incredible way to make sure that you get people over that Cliff that you get that product adoption and that you're encouraging the the

value that your product is capable of delivering for your customers for us we actually saw it within 12 months 65 percent uh expansion revenue from our customers as a result of the effort and emphasis that we put into this program and again it was a net positive on our bottom line in itself we also have a plg motion in terms of people can self-sign up for our platform and we provide the same level of support to somebody who comes in off the door

and never speaks with a salesperson so it's another opportunity again for us to set the precedent on what we're going to deliver for you as a customer and ensure that you have the Comfort entering this new experience and especially going through 2020 and 2021 where virtual events were a new category a lot of organizations were adopting them for the first time using them again for product launches for Customer Events we did it as well we would host and continue to

host week monthly Customer Events as another opportunity to bring the community together the community of our customers to learn from one another and then finally it's really get the whole company behind it make your customer experience team the hero for your organization put them on the pedestal and it's going to pay off in the way that you your team interacts with your customers and the way that your customers want to interact back with you thank you

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