The speaker describes how Blackthorn reached focus through repeated pivots: abandoning unclear products, buying where integration made more sense than building, reinforcing culture, defining an ICP, and selling a clear customer benefit.
Find the ideas you need and go straight to the source.
Drop unclear products
“we looked at all the leads that were coming in and we saw most of them were from higher ed and non-profit at the time we had no go to market and I thought go to market was like this baloney term but it's a real thing for sales and marketing teams to really focus on so what we did was that we flipped it over and we ended up focusing on higher ed and non-profit so with Salesforce I asked hey you know what are your metrics on higher ed and nonprofit you can see some of them are quite small but a lot of them are quite big so we”
“because there's a lot of things that I hate doing in the business I really don't like selling and marketing and accounting and uh Cs and I I don't really like doing any of these things so I I really like doing product and Engineering so what I did is I changed our org around and I have just two people that report to me which is going to be a third once we find our CTO so if you know someone we're hiring but it's just going to be our CEO our director of product and our CTO and the reason I wanted to do this is because I don't”
“wanted to integrate us to say hey we're on Salesforce but they weren't going to bring us anything so we didn't do them a lot of events applications they they have there's so many things you can do with events they all want to integrate none of them wanted to bring us business so we ended up not doing any of those and then a lot of people they all want to have contracts and conversations and Technical Integrations and it never became anything so the original thesis was to make a payment app on the Salesforce app exchange that could integrate with stripe at the time no one integrated with stripe now just everybody knows stripe but we said hey”
“whatsoever then you know that you found your price and that's sort of what we did um what we what just to give you some examples our payments app is now two and a half times more expensive but the biggest customer we had for the longest time was 100K a year we recently sold one that's a million a year for a really really big deployment doing uh mobile payments uh our Events app is now four times more expensive but our average error was about 12K for the longest time uh it's now up around 45k because we”
“Porter sells off did some LinkedIn post about having a line that was making six to seven million ARR a year and that's that's like a lot of people's businesses I was our business for a long time and he just killed it saying I wanted to focus on this other thing I was doing really really well so we've killed a whole bunch of stuff that was at 80k 100K 150k ARR to focus on where stuff really mattered and now it's really working uh you have to try stuff I never would have bought the um taxi company if I hadn't bought pci-fi because it was”
hi everybody I always like to better understand who it is that's talking to see if it'll be of interest to me you know are they at 500k or they are error they had a billion whatever so I'm going to start with our obligatory up into the right graph so we're at about 14 million ARR now I've been doing this for seven and a half years we've got 105 staff and we're a little unique we're in 25 States and 15 countries
we've been remote since we started we have a big well I guess it's all relative 18 million debt facility 14 of which we've drawn so far but we have no board it's just me we have no VC and we plan to be Break Even well 23 is not it's the end of 2022 it's our fiscal 23 so soon so over the next 20 minutes I want to cover product Market fit and then once you have that going a bit wider and then
growing your ACV based upon this so uh we're a pretty open company so I'm going to have a lot of pretty open metrics during this I hope find that interesting so the first thing is finding focus and how we went about this so we sell apps on the salesforce.com app Exchange in the payments and events uh Realm and we initially thought okay we're selling infrastructure it's payments and events anybody will buy this thing well what we did is over time
we looked at all the leads that were coming in and we saw most of them were from higher ed and non-profit at the time we had no go to market and I thought go to market was like this baloney term but it's a real thing for sales and marketing teams to really focus on so what we did was that we flipped it over and we ended up focusing on higher ed and non-profit so with Salesforce I asked hey you know what are your metrics on higher ed and nonprofit you can see some of them are quite small but a lot of them are quite big so we
didn't want to sell two three four five k subscriptions we wanted to do 50k 100K plus space subscription so we had to go up market and find out where these different customers were same thing with nonprofit it turns out a lot of nonprofits have really a lot of money and they have very sophisticated requirements you can't just sell something really basic and they really need a lot of time so there's a lot of business there and nonprofits which I never really understood and it turned out being uh quite lucrative so in order to figure out what it is
that we wanted to do we started with two products to do payments and events on the Salesforce platform we ended up building nine uh products which I really don't advise you to do and over four years from about mid 2015 till early 2019 I just one by one made products and killed them and we initially had a form Builder which we call Blackthorne documents which had a lot of competition from Conga and draw Loop and it turns
out that this didn't work we had a big customer portal where if you're familiar with Google App Maker before they killed it it was a multi-tenant data normalizing portal where you could build stuff like uh contextual declarative this is too many words and no one understood what the heck we were doing and it wasn't solving any problems then there was our billing app where Salesforce had steel brick which had invoice it or invoice it and then that thing got really popular stripe release strike billing and we're like okay we
need to kill this thing and then we were going to do an e-commerce app in Salesforce book Cloud craze so you know all these things didn't work so what we did is we wound it down so we initially were funding a lot of the business from Professional Services you can see over the first few years we were doing about a million a year of proserve that was paying for about 10 of us to work there and we had a few apps that we later killed so a lot of our payments customers were non-profits they said hey give us a donations app this thing
doesn't work for us we built it and and uh unlike Field of Dreams uh they they came but they didn't come because no one wanted to pay for this thing so if you have to have a a go to market Cadence where you're selling a 3K product you can't scale your company so we killed our donations app we killed our billing app our document link our Connect app and then we focused just on events and payments and some of our Revenue comes from our stripe Revenue share which I'll talk about so this is our org chart the reason I'm giving you some of this information is
because there's a lot of things that I hate doing in the business I really don't like selling and marketing and accounting and uh Cs and I I don't really like doing any of these things so I I really like doing product and Engineering so what I did is I changed our org around and I have just two people that report to me which is going to be a third once we find our CTO so if you know someone we're hiring but it's just going to be our CEO our director of product and our CTO and the reason I wanted to do this is because I don't
really like managing people I really like working with product so I took two devs that have been there for a long time and I said we're going to make some new stuff so they form like a little r d team with me and we're bringing new stuff to Market which is what I really enjoy if any of you have been on your path for seven eight nine years it gets kind of boring so if you can change it up or at least it did for me if you could change it up or go back to what you wanted to do like that's been very rewarding for me so after we found our product Market fit with nonprofits higher ed and payments
and events we then said how can we take this thing a bit further so I surveyed some customers that I thought were of interest to us and it was like 40 or 50 that I thought were our Target and I said you know what is it that you need and one of them uh that was of Interest was a developer I knew who made this app called pcify he said let's partner and I said you know why don't we just buy you guys they were 130k ARR we agreed on 850k purchase price we did a down
payment we paid over two and a half years I think we still have a few more payments left there he went off on his merry way he's like I hate Salesforce I never want to do this but you can have our app that's great and uh he was selling his app for like his biggest customer 6K the first deal we did we didn't change the product at all we just sold it for 60k actually because he just Founders don't know how to do pricing and I'll get into that so that ended up being pretty good but then all of our hired and non-customer non-profit customers they wanted to send SMS so I looked on the app and change
and I thought who can we buy because we don't need to actually build this thing we can bolt it on where one of the benefits of all being on Salesforce is that stuff kind of all works together it just doesn't exactly work that way but sometimes you get lucky so I tried some of the apps that looked appealing and one of them was texty and all of our customers wanted the app so instead of building we didn't need to do the integration works I went went for it this was another single developer uh company uh so I reached out to Clint and he wanted to sell and this really helped us
with our nrr so they were at 550k error I said hey you know what do you guys want to sell this thing for they said 6X and I said okay that sounds fair so it ended up being like three and a quarter a million and so we did 1.2 million down payment we didn't have the money to do this so we actually funded it through debt uh the other two million were to be paid over 24 months which we paid over our own uh cash flow and they were going to be incrementing payments so they started small and then they grew with the size of our company and they agreed
with that they ended up taking a senior position and when we got a debt facility they wanted to pay the whole thing off so that was a little twist of events um but we actually were able to buy this through debt without dilution so uh something else that happened with product Market fit is just to be weary of Partnerships so we tried to do a lot we tried to integrate our payments app with two other app exchange apps and that took a lot of time and resulted in no Revenue a lot of payment gateways reach out to us but none of them were going to bring us any business they just
wanted to integrate us to say hey we're on Salesforce but they weren't going to bring us anything so we didn't do them a lot of events applications they they have there's so many things you can do with events they all want to integrate none of them wanted to bring us business so we ended up not doing any of those and then a lot of people they all want to have contracts and conversations and Technical Integrations and it never became anything so the original thesis was to make a payment app on the Salesforce app exchange that could integrate with stripe at the time no one integrated with stripe now just everybody knows stripe but we said hey
why don't we have a revenue share and we'll push everyone your way and now we're making uh somewhere in the vicinity of like a million a year off of that partnership where our customers don't get charged uh uh it's a pass-through of revenue from everything that's processed by stripe and it works like really quite well for everyone and then our main source of leads is through system integrators so when you buy a big enterprise system there's all these integration partners that build stuff they can bring the customers to you so they'll say hey we need to do events or
we need payments they actually bring us the deals that's like 75 of our leads that we have now so some other stuff that we do with Partnerships is uh we give a fair bit of money away so we do one percent of our Revenue goes to stripe climate I think this goes into my own personal interests but part of our building of our company culture we've given away 120k to date and for a company that's not yet even break even and maybe this is unique because we don't have a border VC so we can do this but uh it's been able to help the world a bit and people can
relate to it we also do three thousand a month to watsi.org they fund surgeries in developing countries for people that you know really need the help and this like these kind of Concepts they're not really politically charged or religion based or something so a lot of the team like no matter where they're from they can relate to them and it just it's been a nice benefit that everybody's gone for so these are like off to the side Partnerships that have really helped the culture um so in terms of what it is that we wanted to build
uh Paul Graham sort of says you know listen to your customers and what it is that they want to make they're going to tell you and that's true Steve Jobs said you know if everybody said uh you know give me a faster keyboard I never want to end up with the iPhone but in the world of Enterprise B2B SAS this is just listen to them they'll tell you what it is that they want so we've more or less done that and that's taken us down the right path of everything that people want to pay more money from this is product board and we just take everyone's information that comes in we have an ideas portal and we just
aggregate it all into this one platform it gets voted up and then we assess what we want to do based upon effort and the revenue that we can bring in so after you have all this stuff uh don't be afraid to raise your prices and tell the story and build the value so um Founders suck uh at pricing uh everybody almost everybody I've met undervalues their product uh particularly me so they'll say like oh it only took me four months to make let's charge like 2 000 bucks but this is not really how
you're going to build a company there's a big fear of losing a deal so I discounted a lot I don't come from an Enterprise B2B sales background where I've sold five million dollar deals or something so it took me a while to to figure this out so what we did was we just kept raising prices I heard a great talk from madhavan ramanujan about how to do pricing and think about it he worked with segment to do their pricing where he said raise the price when people tell you you're crazy raise it again when they say You're really crazy you're almost there when you say we're really crazy we're never buying
whatsoever then you know that you found your price and that's sort of what we did um what we what just to give you some examples our payments app is now two and a half times more expensive but the biggest customer we had for the longest time was 100K a year we recently sold one that's a million a year for a really really big deployment doing uh mobile payments uh our Events app is now four times more expensive but our average error was about 12K for the longest time uh it's now up around 45k because we
started to land a lot uh bigger accounts because the application's grown a lot more sophisticated we have a bigger team it's really doing a lot so as we've gone on we've increased the the pricing there uh and just to give you an example of my Insanity I had 930 different prices that I looked in my stripe product uh price book over the first three years I had a unique price for every single customer so basically the pricing just never scaled at all uh so uh this is George in
Australia I've never actually met George I've been to Australia once it wasn't then and I never even saw this booth which was a really interesting uh kind of concept about scaling uh Stuart Butterfield said I never understood the size of our company until I saw an ad in the newspaper I didn't know even know we were running I didn't even know we were going to do this that was a whole other different kind of thing anyway that's the tangent uh so play with packaging what we found is that within our Target verticals of higher ed and nonprofit they want to be told a story they want to understand how to buy stuff from you
so once we had our ICP our uh ideal customer profile or whatever that thing stands for we then could find out who it is that we were talking to what it is that they wanted to buy so we had multiple products this payments paylink document link no one knew what the heck all this stuff was we just combined it into one and then we we sold it as a story rather than as a feature which was another big problem of Founders that they're technical they just focus on the feature not really the benefit uh so then within hired a non-profit we then started to tell the story about how you need events and payments and
messaging so we painted this vision for them about how they can go down this road to buy all of our uh products into this platform that people really want to then be able to to use you can buy from one vendor to get all this stuff instead of going to all these different places we're launching a storefront app next month which focuses on continuing and Executive Education as sort of like a Shopify for Salesforce that idea only came out of listening to customers like we didn't magically come up with this idea it just came from them and we have just crazy demand for this thing
so some key takeaways we have about 630 customers we've processed about three billion bucks through the app and we sent 31 million SMS messages which is twilio is the underlying technology here and some some big things I never really understood uh it is far better to make a decision rather than making no decision if you get stuck making no decision about what you want to do it is way worse than making a wrong decision uh kill your weak product lines uh Kyle
Porter sells off did some LinkedIn post about having a line that was making six to seven million ARR a year and that's that's like a lot of people's businesses I was our business for a long time and he just killed it saying I wanted to focus on this other thing I was doing really really well so we've killed a whole bunch of stuff that was at 80k 100K 150k ARR to focus on where stuff really mattered and now it's really working uh you have to try stuff I never would have bought the um taxi company if I hadn't bought pci-fi because it was
easier it was easier to finance it was more structured try to hike the pricing uh for me it was very scary scary early on and so I hired some sales people who understood the markets they knew how to tell the story and then they helped me kind of understand how to hike the pricing and try some Partnerships a lot of them won't really do anything but some of them might actually be pretty awesome but be quick to sort of like uh abandon them there's like the higher slow Fire fast kind of thing for people that is the same thing for Partnerships
and listen to customers especially if you're in B2B SAS uh they'll they're just going to tell you you know what it is that you want to do and sell your journey the journey is you know everything about telling your story and and making this all happen uh so a few things we started out with this thesis of doing payments and events and we kind of knew it was right but we ended up buying all this other stuff so we went from two to nine apps and back to two so just be wary of chasing shiny
things and once we had this Focus we then went a good bit wider and then we started to grow our ACB so if you have any questions um Chris at blackthorn.io I'm here in the city if you have anything uh happy to help this was uh helpful enjoyable thanks [Applause]
