Two Pivots And Three Countries Later… We Have an App

by Etienne Garbugli on May 18 โ€ข no comments.

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Ludo

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The World

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Étienne

“Everyone has a plan until they get punched in the mouth.” โ€“ Mike Tyson, Retired Boxer

The Story of Highlights โ€“ How it All Started

The story of Highlights began when Ludo and I were working at LANDR. The company had aggressive goals for international expansion. We were doing well, but there were some challenges.

Without boots on the ground in each of the countries we were targeting, it was difficult to get a clear picture of all the challenges we would face.

Payment issues? We got them. Localization challenges? We had tons. Pricing mismatches? All the time. Legislation problems? I’m sure they were coming.

Expanding internationally means facing a lot of Unknown Unknowns, and running into countless challenges scaling beyond uni-lingual support, communications and cultural norms.

For me, international growth seemed like a challenge worth exploring. As analytics tools were becoming more and more specialized (Amplitude = Retention, Flurry = Mobile, Hotjar = content), and platforms like Segment made it easier and easier to switch from one vendor to another, it felt like there could be room for an international expansion analytics platform.

The Plan

The plan was to leverage existing (and sometimes stale) analytics data to provide fresh new insights to help guide international growth.

Because I was also looking for a new place to live, the journey began in Tallinn, Estonia.

The Story of Highlights โ€“ Tallinn, Estonia

Tallinn, Estonia

Tallinn is a beautiful city. It’s very liberal, and open to business. The local startup scene has been buzzing since Skype made it big.

For a country of just over 1.3 million people, it produced a ridiculous amount of successful startups (Pipedrive, Toggl, Weekdone, Testlio, Fortumo, etc). For me, Estonia was definitely worth checking out.

The Story of Highlights โ€“ Customer Discovery

Because the local markets are smaller in Europe, it also made sense to start there. Internationalization was likely to become a concern much more quickly for European companies, than American companies (with a large domestic market to tap into).

To get a feel for the problem space, I started doing customer discovery interviews with growth leaders in European SaaS businesses, looking for organizations that had raised A or B rounds of funding.

It was fairly easy to reach decision-makers (CEOs and demand generation leaders), but although their organizations faced challenges expanding internationally, there were some patterns I was noticing:

  1. Most of the businesses that had successfully expanded internationally had targeted the American market in English from the start. They didn’t have anyone assigned to international growth (who would use the product?), didn’t buy market research (what budget would pay for the product?), and didn’t typically use culture or location as a key dimension for their market targeting. ๐Ÿ˜ฌ
  2. Half of the businesses that had expressed desire to expand internationally had abandoned their efforts due to lack of resources or true successes.
  3. To sell a product like the one I had imagined (an analytics platform), I would need to be able to identify the absolute right moment to approach organizations… Too early, and the tool might be harmful or remain unused, too late and the value-add might be limited.

Although it seemed less and less promising, international expansion failures were extremely costly… One of the businesses I had spoken to had spent 1/4th of its funding developing the Colombian market before realizing that Colombian credit cards couldn’t be used to make international purchases… ๐Ÿ˜ฎ

There was value in the information I wanted to provide, but international growth was a sub-problem, not a core problem.

Because I wasn’t ready to start dealing with the snow in Tallinn (October!!), I decided to move to a much warmer destination… Budapest, Hungary, the unofficial European capital of the digital nomad underworld.

Budapest Life

The Story of Highlights โ€“ Budapest, Hungary

Budapest Cafรฉ โ€“ Now, where am I going to sit?

Because internationalization was ONE choice among many to grow a business, I wanted to take a deeper look at the challenges the businesses we interviewed faced.

There was a clear problem around decision-making in growth. Instead of focusing on internationalization, I decided to abstract it one level (and zoom out) to help businesses make better decisions and create more data-driven cultures. It felt like a big change, but it had really just evolved naturally from the discussions I was having with SaaS entrepreneurs.

Many businesses strive to create data-driven cultures, but fail in doing so.

It’s difficult to share key information during standups or around the coffee machine. Solutions like dashboards rarely work in the long-term (people either stop looking at them, or teams start asking for their own dashboards).

One founder notoriously said:

“As a CEO, I don’t want to be the bottleneck. I had to close my 2 previous businesses because they didn’t scale. The real problems start at 10 people when you can’t do more work than the people, not at 50 like people think.” โ€“ SaaS Founder

I completed another 20 interviews with businesses interested in creating more data-driven cultures, and then moved to Tbilisi, Georgia when my Schengen zone visa expired (one day late actually ๐Ÿ˜ฌ).

Tbilisi Life

I had discovered Georgia on a previous trip, and thought it was pretty amazing. The cost is 50% of what I would pay in Montreal (longer runway). The visa is 360 days, renewable for most countries. The Internet is fast. The lifestyle is pretty laid-back. The only issues I had was the 9 to 12 hours time difference with North America, and the 2am calls with PST.

The Story of Highlights โ€“ Tbililisi, Georgia

My First Trip to Tbilisi, Georgia in 2017

In Tbilisi in January 2018, I got confirmation that Ludo was joining me on this adventure. He’s pretty much the ideal business partner for me. We both geek-out over data, like shipping and iterating fast, and we โค๏ธ smart and simple products.

Together, we started to define a basic minimum viable product (MVP). Our thinking was that in order to create a data-driven culture, the first challenge was to get people to start looking at the numbers, and the best way to get people to look at the numbers was to tie it to their business objectives.

We wanted to allow businesses to connect various data sources (Google Analytics, Amplitude, etc), and set goals they could track over time. In context of the objectives and the specific users, we wanted to add insights and intelligence (e.g. international expansion data).

The Story of Highlights โ€“ Highlights for Sales

Highlights for Sales โ€“ Minimum Viable Product

Within a week or so, we picked the name Highlights (as in Highlighting the important information ;-), incorporated the business in Delaware (Stripe Atlas), and set up a simple MVP (manual connection to data sources + visualization and sharing of objectives). I followed up with the entrepreneurs I had interviewed, and started “pitching”.

The whole process was very educational. We learned that:

  • If you approach a C-level (CEO, CMO, CTO) selling better organization alignment, transparency or focus, you get a relatively negative response. Business leaders tend to over-estimate alignment within their organization. Top-down sales were going to be difficult.
  • When you talk about dashboards, you get a “not another dashboard” reaction. Dashboard companies compete on the number of connectors they have, and the flexibility of their tool. It’s hard to differentiate as a new player in the market.
  • When you talk about communication around data, you hear: “oh, we do that via Slack, no problem.”. This is not usually true.
  • When you talk to people lower in the food chain in organizations, you realize that people struggle making decisions based on the latest version of the truth. Information doesn’t always circulate.

It was impossible to compete on connectors or flexibility, but it was possible to compete on focus, intelligence and impact. To start, we wanted to focus on sales teams in sales-driven SaaS businesses as a small-er version of the organization.

Very quickly, we got a first client… Well, almost…

No matter how we framed it, the fact that our main interface looked like a dashboard, automatically made people compare us with dashboarding tools like Geckoboard or Klipfolio.

In order to differentiate, we added annotations, social features, smart trends, and more.

Our pitch started to connect (we were creating the first and last 2 minutes of an employee’s day!), but we were in pretty crowded territory. Before we would be able to execute on the full vision (intelligence sharing across the organization), we were pretty much stuck in a waiting game.

As I moved to Batumi, Georgia, it became pretty clear that sales cycles were going to be long.

We were effectively still waiting on deal-close for our “first customer”, and it was getting annoying.

The Waiting Game

The Story of Highlights โ€“ Batumi, Georgia

The Black Sea isn’t black at all…

Although we always felt that Highlights was incremental to a business’ tech stack, a lot of businesses felt that we would need to replace their current solution (harder to sell).

We tried various things to speed up the sales process (e.g. target less established businesses, meet face-to-face in Paris (Ludo lives 3h west of Paris), make the first month free, etc), but it didn’t allow us to generate momentum; the basic product was not differentiated enough. Our most unique features would come way too late to impact buy decision.

More so, as a team, we wanted to capitalize on our strengths (iterate fast), and get a lot of feedback to improve the product.

Pivot #2 โ€“ Introducing Highlights

Maybe it was the fresh air of the Black Sea, but in Batumi, we had an epiphany. Wether it was internationalization or data-drivenness in organizations, our vision had stayed the same: help businesses make better decisions by adding intelligence to existing data sets.

We realized that we could create a simple product that connects with Google Analytics and various email marketing platforms to automatically find and prioritize the biggest optimization opportunities, automatically; it would allow us to provide value faster.

We built a very basic version of “the algorithm” in Excel (Google Sheets actually), a landing page and started to interview entrepreneurs, content teams, solopreneurs, lifecycle marketers and agencies โ€“ the people we thought could use Highlights.

The Story of Highlights โ€“ Excel Prototype

The First “Prototype” of Highlights

We learned a lot with these interviews and the feedback we got from the IndieHackers community; the response was really positive. We learned that copywriters (the people creating conversion / email copy for organizations) would really benefit from using Highlights.

Highlights would help by:

  • Centralizing and giving easy access to landing page and email automation performance.
  • Prioritizing optimization opportunities and high-performing content.
  • Standardizing landing page and email performance analysis across the organization.
  • But also:

  • Return on investment tracking (e.g. what’s moving the needle? what’s not?).
  • Deeper funnel analysis (e.g. why people drop off at certain points in the marketing funnel?).

The Story of Highlights โ€“ 4 Months of Code

Ludo Building Highlights

We launched Highlights on Wednesday May the 16th, and we’re excited to make it evolve for our users.

You can signup for a free 21-day trial right here, and we look forward to help your businesses. ๐Ÿ™‚

Étienne (back in Tbilisi, Georgia)

Want to Know Which of Your Emails Are Underperforming?

Highlights finds and prioritizes the biggest optimization opportunities from your email marketing data, automatically.

Etienne Garbugli
ร‰tienne is a three-time startup founder (Flagback, HireVoice and Highlights), and the author of Lean B2B: Build Products Businesses Want. At Highlights, ร‰tienne is responsible for customer success.

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