DA: 03:07
Hey Liam, thanks so much for joining me today on the SaaS breakthrough podcast. So excited to have you here and learn a little bit about what you're doing over at Time Doctor, Staff.com. Lots of cool stuff including Running Remote, your remote work conference, which is really exciting. But before we jump into initiatives and tactics and all the great stuff we're going to talk about today, why don't you tell us a little bit about Time Doctor, when it was founded, who the customers are and what you're doing uniquely in the marketplace.
LM: 03:37
Sure. David, thanks for having me. Yeah, so Time Doctor, what is it? It's basically a tool to be able to manage remote employees. We kind of deem it as Fitbit for work. So if you want to not just measure how long you worked but actually get better at working, Time Doctor is the tool to be able to do that. It started with me and my co-founder, we were just talking about a conference before we jumped on this call and we met at a conference as well, which was South by Southwest, which is if you haven't been is basically like spring break for nerds. It's, it's just tens of thousands of people that are all kind of running around down in Austin, Texas, eating barbecue and talking about technology. So we met at that and I had actually built another company off of grad school.
LM: 04:31
So I was at Neil university, which is a [inaudible] university in Quebec, Canada. I'm French Canadian. And we had, I was basically going to enter academia. So I was given my first class for people that don't know, most course first year courses are actually taught by graduate students. They're not taught by professors because they're way cheaper. You can basically get them at slave wages. And so I taught that class, started with about 300 students, ended up with a little bit above 150. I got the worst professor reviews in the department's history and the department was 225 plus years old at that point. So that was not good. I remember walking into my supervisor's office and I said, I don't think I'm very good at this. And he said, no, you're not. And then I said, so what should I do? And he said, well, you got to get pretty good at this teaching thing if you're going to enter academia.
LM: 05:31
So either get much better at lecturing or figure something else out. Four weeks later I threw a masters thesis under his door and I was out of that world and turned it actually into one of my first businesses, which was remote, which was an online tutoring company. So we grew that to dozens of tutors throughout North America and Europe. And you were teaching premed prerequisites, which is still by the way, an incredibly profitable niche for anyone that's really getting started and wants to run a remote business. So the problem that we had, however it was, we couldn't very clearly identify how long a tutor worked for a student. So I billed a student for 10 hours and then the student would come in between and say, well, I didn't work with this tutor for 10 hours. I worked with them for five hours. And then I'd have to go to the tutor and say, Hey, did you work with Jimmy for 10 hours or five?
LM: 06:24
And the tutor would say, of course I worked with them for 10 hours, I billed you for 10 so I'd end up having to refund the student for five hours and pay the tutor for the full 10 hours. Then that was destroying the business. So Time Doctor basically completely solved that problem. So right now I'm doing podcast with David and that is adding into my podcast task. So I'm seeing all of the actions that I'm taking. Like right now we're using Zencastr, how much time did I spend on Skype, how much time did I spend on Gmail, all of these different variables. And then I can add that to the other 300 plus podcasts that I've done over the last couple of years and analyze exactly how much the podcast costs me to do. And more importantly also how much a podcast makes me, very clearly measure the ROI of everything that I do inside of the company. So we have about a hundred remote employees in 32 different countries all over the world. And we measure all of our data very specifically to figure out how efficiently we can work. And how we can make ourselves more efficient, when we're working remotely.
DA: 07:29
That's fantastic. That's an insanely great story. Kind of how it all ended up. Now it makes sense. Time Doctor, the name makes perfect sense. There you go. There you go. And it's funny, I actually almost went to your college that you went to in Montreal. Love that college. It's an amazing, amazing place. But that's fantastic. So you kind of got started in that specific industry. How have you evolved over time? Have you built out product market fit into other niches, other categories? How has that kind of changed as you built a company?
LM: 08:00
I mean, define product market fit number one. there's various different definitions of what that might be, but I would say yes. So we've developed some interesting niches inside of Time Doctor, we have three separate customer avatars that we approach. We have BPO Bobby agency, Adam and Tim Ferris. So BPO Bobby is the business process outsourcing industry. So if you're, if you call MasterCard right now as an example, you're not actually calling MasterCard, you're calling a BPO. Basically a company that is subcontracted out to be able to handle the phone support on MasterCard's behalf. So those are our major category of clients, probably about 10% of our customer base, but generates about 50% of our revenue. The second one is agency Adam and agency Adam, we talk about these people like they're people because it's really important to refer to our main customer avatars in that way.
LM: 08:59
So agency Adam is basically your average agency and time is really important for an agency because a lot of agencies, maybe they have 20 clients and they know that they're profitable. So they know that they're spending $100,000 a month and they're making 120,000 in sales, but they don't actually know whether or not each client is profitable for them. So Time Doctor completely solves that because we can break it down by client and say like, well in reality actually you're spending, you're actually losing $4,000 a month with this client. So you should either charge them $4,000 more per month or you should fire them as a client. So that's the second category. And then the third category are what we call the Tim Ferriss. And those are the people that have read the four hour work week. They really enjoy, they really like the concept of kind of living on the beach and, and basically living that type of lifestyle. And they've usually hired one or two remote employees and they, they work, they use Time Doctor to be able to do that. They are not actually profitable for us. They basically net out as okay, kind of a loss. I think their lifetime value was like 90 bucks, but they tell a lot of their friends about Time Doctor. So we keep those customers in the funnel simply because we recognize that they tell their friends about 70% of our business right now basically comes from referrals and they're a major part of that engine.
DA: 10:30
Is there ever a time when you do kind of close off that segment of your audience? We have a very similar big segment. We call them like, we have our own names, but basically a very small business owner, solopreneur, entrepreneur who comes in is a great customer for us. Again, great word of mouth, but, not a huge, you know, lifetime value, not a huge lifetime of their account. Do you ever think that you'll get to a point where you're like, we're not going to accept those anymore or is it just part of the business?
LM: 10:58
I think is part for the business model. Think about it in the same way as Dropbox. Right? So Dropbox grew their entire business model off of freemium and I almost kind of call this freemium because yes, they're paying us, but at the same time we aren't making any money. So they're kind of our free customers to us. Like, we're not generating any income. We're literally transferring that revenue directly into support. And so they are being, they're given absolutely fantastic customer support. If we were to move it to a freemium product, we could not provide the level of support that we currently do. And we actually looked at making those customers completely free, but we recognized that that would actually damage, not only our brand equity, but more importantly it would start to move up the chain where people would see the software as less valuable that are maybe at the five seat range as an example, which is a profitable customer for us. So we realized that, and actually, great reference is Ahrefs, which we use all the time, they switched to a $7 seven day trial and you cannot basically, you can't opt in unless you paid a $7 for the trial and their business completely changed once people started to respect the software as something that had value to it, my opinion is you should actually always move that dollar amount up as much as possible because I think you're going to get more valuable customers down the line.
DA: 12:32
That's super helpful. That's really valuable. Yeah, I like that. And I want to go into the different marketing initiatives and channels that you guys have been using to grow you're kind of in a well, it is a competitive space. There are a lot of different time-tracking productivity software out there. You guys are obviously a key player in that niche. You've done a great job of differentiating yourselves, getting out there, doing marketing. But before we do that, one of the conversations that you and I have had before is kind of around the pros and cons of bootstrapping versus bringing in funding specifically for marketing. We're a bootstrap company. So I thought this was just an interesting conversation piece. I wanted to get your opinion on the idea of bootstrapping versus funding. Do you need to have funding these days in B2B SaaS? Is that essential to, to build a moat for most of your companies?
LM: 13:21
I mean, honestly, I mean it depends with a lot of these answers, it's not a simple yes or no. So if you're in Palo, if you're building a company out of Palo Alto, you have to have funding because an engineer is $250,000 a year. And you just can't, you can't do it in a bootstrapped way. Any other way if you are remote, however, you could probably do it in a bootstrapped way. I mean, it's a little hypocritical for me to be able to say that we're entirely bootstrapped because me and my co-founder had exits before, so we were able to invest our own money. But when you invest your own money, I find you're actually a lot more kind of precise about where you put your funding and where you put your time. So probably put myself in that camp.
LM: 14:08
But when you look at, there's a huge bias for remote teams or remote companies to be bootstrapped. It started because the VCs don't see remote as a viable business model. So they're immediately quite apprehensive towards it. But now that it's evolved and it's at the point that we're at right now with remote work really kind of exploding in the market now you can start to approach funding. And I think that the thing that I would do is only take enough for what you need to do. And if you don't know how much you need to do what you need to do, then you shouldn't take funding. Does that make sense? So the first time that we looked at a Series A and we got a bunch of term sheets and they all told us we love it. We love what you're doing. Just come to Boston, Palo Alto, San Francisco, Toronto, Montreal, Boston, and you're like, well, we're not, we're remote.
LM: 15:10
Right? Like you're not supposed to bring everybody to one place and like, we're venture capitalists just trust us. And we didn't. We just continue doing what we're doing. And I'm quite happy. I mean, hindsight, 20/20, we'd probably have a bigger business, but probably have less money in my pocket. That's another thing that you have to understand with venture is almost inevitably the founder will have less money if they raise money. And I know that that sounds counterintuitive, but when you look at the data, bootstrapped, we'll put way more dollars into the hands of the founder then a, than a venture capital run. And there are outliers, like I'm right across the street from Shopify as an example. Tobi is a multi multi-billionaire now and you look at those success stories, but if you actually average it all out when you raise money, you will have less money in the exit or you will have obviously way less in dividends because you won't even be able to give yourself any profits from the business.
LM: 16:12
So that's an important factor to take into consideration as well. My route in the future is probably going to be mostly bootstrapped. I'm not saying there wouldn't be a situation in which I would raise money, but the other factor that's coming up today is acquisition is so much more expensive than it was last year or two years ago or five years ago or 10 years ago. I remember literally being able to buy trials for pennies on Time Doctor and now, I mean, those same trials cost 30, 40 bucks, on Facebook. So I actually think now if you really wanted to go hard in the B2B space, you probably will need some revenue to, or sorry, some funding to be able to kind of get to the point in which you have a micro brand and then once you have that micro brand it's going to self actualize and you're going to actually get that revenue coming in because you're going to have the customers that hopefully you've made happy and they're going to refer other customers like the current situation that we are in. But that costs probably, I mean if you do it really efficiently, millions, if you do it inefficiently tens of millions to be able to get to.
DA: 17:28
So then my question becomes if you are bootstrapped, how are you able to create evergreen long term marketing initiatives that you see as powerful lead gen source acquisition sources to kind of get that flywheel that you're talking about going, how do you get that going? If you are bootstrapped and you are going to take on the monsters that are, you know, already funded, they're going to be able to put that money down into PPC advertising and they're okay spending that 10 million because they have it.
LM: 17:58
So we're recording this in October of 2019. We're in a very unique situation. I wouldn't have said this a year ago, but I mention it now, which is within the next three to six months that is not going to exist anymore. That model because there are tons of companies right now that are buying their lifetime value or above their lifetime value to acquire customers through paid advertising. That will, once the correction really kicks into high gear, venture capital is gonna just get melted. And actually if you're very smart right now and you have some EBITDA in your books, I would very much look at stockpiling as much of that cash as humanly possible because all of these companies that are currently (inaudible) and venture capital in them, they've invested money into that flywheel. They are not sustainable anymore and you can start to acquire them.
LM: 19:00
I'll give you a perfect example, a company that is in our space generally. We looked at them about a year ago. They were doing 2 million in revenue and they were looking to get sold for 10 million. So 5X their revenue numbers, they're now coming back saying they would get bought for 3 million. So these things are starting to happen in this company had raised an exorbitant amount of money. I would say in the eight figures, in terms of raising, I don't want to be too specific because I want to make sure that I'm respecting what the, what they're currently doing. But that's an example of a company that we can buy very quickly and easily. And I'm literally buying all of that investment, all of those investment dollars for literally a nickel on the dollar. So I think that that is is a huge opportunity.
LM: 19:54
Now, if you don't have that opportunity in place, in my opinion, if you're gonna own the business for longer than five years, you should put absolutely everything that you have in terms of marketing dollars into two variables, retargeting to be able to build your generalized baseline to continue to feed that flywheel. And then you should be doing content marketing and SEO to be able to fill up the funnel. The reason being is that has, that is the only form of marketing that produces dividends long term. So we currently ranked number one for time sheet templates that gets about 50,000 searches a month. That keyword generates a lot of revenue for us. It took us nine months to be able to rank number one for time sheet templates, but now that we're up there, that thing is continuously producing dividends of maybe two to 3000 MRR per month, infinite item into hopefully the foreseeable future. So that's an example of a keyword that you know, is, is great for us in, there are so many other keywords that are out there. It takes a lot of time and energy to be able to get to that point. But the beauty of it is you can go at your own speed. So if you can afford it, I would just put into those long terms investments. It's almost like like buying real estate because when you buy Facebook ads, you're renting leads, right? You're just getting leads this month. But if you invest into SEO, you're going to eventually rank for a keyword that's going to produce dividends for hopefully the next decade.
DA: 21:24
It's a fantastic answer and I kinda just want to recap it because you broke down so much and there's a lot to dissect there, but basically what you're predicting is macro economic changes and you're kind of approaching this from an interesting perspective of both a founder of a company and also from the marketing perspective, kind of looking at how things are shifting in the marketplace, but influx of capital coming into a bunch of businesses, B2B marketing and B2B businesses exploding in SaaS. You have a lot of capital being dumped into advertising funnels, renting the space you said, which is driving up the economics of all that stuff. And you have companies that are not profitable. IPOing you have companies that are only existing because of funding and they're continually raising to stay alive. Haven't found profitability yet, and all of these things are going to come to a head, which is going to mean the companies that survive are the ones that have long term marketing initiatives, the long term acquisition methods that can continue to drive quality leads. Their business is sustainable, their product is valuable, but they're not relying a hundred percent on advertising, which may get (inaudible) does that sound right?
LM: 22:38
Yep. So let's talk about WeWork, which is probably, as I said, as we're talking right now, in October of 2019 is currently in a massive implosion. And I pointed that one as an example. There are tons of, we works in the B2B SaaS space that are just like, I've looked at the economics and it's ridiculous, so they'll, they'll say, Oh yeah, of course it's, it's totally reasonable to buy a customer for $4,000. The lifetime value is $3,000 over the next five years. But you know what? Listen, we're going to figure it out long term. That is not, that's not a model that's sustainable because the moment that that venture capital gets cut off, you're done. And like the last collapse that we had was 2008. I was actually in the workforce in 2008. I remember that was right when I got out of grad school and I had three jobs lined up, all six figure jobs. Within three months they all dried up. And that's actually what forced me into entrepreneurship because I realized I had to start my own business because no one was willing to actually hire me. So this is serious. Like people that haven't lived through one of these things, it is going to get wild. And the biggest fire sale will be in venture capital because it's so overvalued right now. How many billions of dollars was invested into WeWork, I think like $12 billion by SoftBank? And they, yeah. And they generate negative one point $9 billion a year. iIf you, someone had run a calculation that if you gave every single customer that WeWork had $5,000 a year to say that you were a WeWork customer, you would have less of a loss than we were currently has. It's insane. Their economics don't don't even come close to working.
LM: 24:44
And so you look at all these other companies that are currently in the space that are doing this, the moment that those large firms and I'm talking of venture firms collapse, they're going to call in all of their bets and all of a sudden all of these guys that are doing, you know, five, $10 million in ARR, but they raised 50 million to a hundred million dollars to do that, they've got to figure out how to become a profitable business very, very quickly. And a lot of those guys will not be able to figure it out. And they'll get bought by guys like me for, you know, maybe they're making $10 million. I don't, I see a situation in the future where I can probably buy them for their ARR.
DA: 25:25
A one time evaluation. So just like a fire sale across the market, which is, which is awesome for companies.
LM: 25:30
Which is just great for me.
DA: 25:32
Exactly. Companies like you that have cash reserves. And so the key here and for the marketers listening, it's setting yourself up with a moat of marketing, a marketing moat to generate, you know, acquire good leads without the need to spend all your money in advertising or at a loss. So obviously doing smart economics for acquisition. So you mentioned before some of the things that you think are the best sources of that content, long term marketing and then SEO. And I would love to dive into how you set up your SEO teams, how you, how you kind of processed that whole thing. I think I watched this amazing live stream from Wistia the other day. I'm not sure if you saw it, change the channel by Chris and Bryan, their team did an amazing job, but they basically talked about, you know, the next generation of marketing and B2B is going to be long term content marketing, exactly what you're talking about. So, this is the shift where everyone's going to be going. I think this is a fantastic topic, but talk to us about how you set up these SEO and content initiatives.
LM: 26:35
Sure. So we definitely, I mean SEO is the major part of our marketing pie and we've been able to over the last eight years, we do about half a million dollars in traffic value and traffic value is basically how SEOs measure the value of traffic. Because just getting traffic doesn't necessarily mean that you're going to get customers. You need like to rank for time sheet templates instead of PornHub. As an example, if I ranked for PornHub, I'd probably get 10 million views a month coming to my website. But they are looking for something else. They're not looking for time tracking software. So you need to be able to have qualified traffic. And the way that we structure everything is at the top of the team. I have my SEO manager, my content editor, and my head of research for the content team. So below that organic below those three people on the SEO manager side, they manage the linking team, the content editor manages all the writers and the research team obviously handles the research team.
LM: 27:46
We have one core metric that we follow which is cumulative domain authority and everything connects to that. So everyone on that team focuses on that and everyone below that team focuses on that single metric, which is something that we came to about two or three years ago where we initially were trying to measure how should an SEO team work. And we started saying, well, they should really be acquiring backlinks because that's fundamental to how we do SEO. And we realized if we started measuring that, then all of the linkers just started going after really low domain authority websites. And domain authority is basically a measure between one to 100. 100 is Google. One is your brand new website that you just put up on your server. So it just basically measures how important your website is. We use the measure from Ahrefs. You can also run one through SEOmoz. I think they just call themselves moz.com right now, but either tool really works. So we now switched to cumulative domain authority where if we get a backlink from Salesforce as an example, which is a DA 86, that counts as 86 points. Whereas if I got a link from a Time Doctor, that's 77 points. So it's 86 plus 77 instead of one plus one back link. So basically we're trying to measure the differences between each particular backlinks.
LM: 29:15
So we sit down every month, we identify all of the keywords that we want to target for, I believe it's two months into the future. So we're always working basically one quarter ahead and we identify how easy is it going to be to rank for that particular keyword. I think we have a 60% top 10 SERPs rate that we go after. Right now, we're always trying to push that up. So basically that means if we write 10 blog posts, six of them will end up in the top 10 of the SERPs within three months. And we really tried to be mindful of that because if we write a piece of content and we invest the time and energy and it doesn't actually end up ranking, it's basically worthless to us and we throw it out. So that's another important factor that you need to take into consideration when you're deploying these types of campaigns. So we look at those keywords between the three of us, then those contracts are put out to the writing team, the writing team write the pieces. We do a 3000 plus word article, per keyword. If you know, a lot of people talk about doing 1500 words, 2000 words, that will work.
LM: 30:22
But if you really wanna do it, 3000 plus words is the way to do it. It's just going to rank a lot easier, long term. And you might as well do that investment on the front end and optimize on the back end. So we read all those articles up. The content editor optimizes them, sends them over to the SEO manager. The SEO manager then deploys them on our blog, puts them into the content queue. Then it's led over to the linking team and the research team. So what we'll do is we will grab let's say the top 10 SERPs for a particular keyword. I'll use time sheet templates as an example. We won't just go after those top 10 people in the SERPs because usually those people don't actually want to give us a link. What we will do, however, is we'll scrape everyone that's linked to those top 10 SERPs and we do not proceed on a campaign unless we have at least 500 people that we can talk to for a particular keyword campaign.
LM: 31:18
Then we reach out to those people. We use a tool called BuzzStream. It's like a social CRM so that everyone on the team, if I've already reached out to you as an example, David and someone else on the team wants to reach out to you once they actually put in your email address, they can see here that 28 other interactions that I've had with David maybe two and a half years ago. And you can bring up that context. So it's very contextual. And then we basically do an outreach campaign at that point and the difference that we have in our outreach campaign in comparison to most of the other stuff that you probably see, I mean I get a hundred of these emails a week is Hey, David saw your blog post on X, Y,Z , totally awesome, huge fan. Read every single one of your blog posts, you know, since the beginning of time. Hey, can you link to my thing? And that doesn't work. It does work in the sense that you're probably going to get a one to 2% conversion rate where you're going to get those links. But our sits around 10%. And the reason why we do, why ours is so much higher is we have a lot of context built into what we're doing. So we'll say instead, Hey David, this is Liam from Time Doctor, I read this article on time sheet templates that you wrote and I think I would love to be able to get a link for our article on time sheet templates. But it looks to me like you're trying to rank for marketing platform as an example or you're trying to, you're trying to rank for webinar platform and it looks like you're eight for that. Well, we actually happen to have an article on the webinar industry and we just added you in here.
LM: 33:03
Here's the URL, here's what we wrote about you. You know, I hope that that is, that's, that's great for you and I hope that's able to help you out in getting your rank. And we'd love to be able to work deeper on some type of deeper partnership that usually ends up producing a much better return because I'm giving you something before I'm asking for something. And I'm very clear saying, Hey, I want to link back to your website, but what we're doing is saying like, Hey, we're actually giving you something and that has such a higher return on investment, than, than what we've been doing previously, which is basically just saying, Hey, I don't know. You give me a link.
DA: 33:45
Yeah, no, that makes a ton of sense. Not only that, but you're doing the value add without them even asking. Not just going, Hey, let's do a value swap. You're like, Hey, we've already done this for you and you know, just to help you out and, and kind of reciprocal value is already there. That's, that's an amazing idea. I love that.
LM: 34:01
Yeah. So that scales, pretty aggressively. So we run it just like a sales team and we literally have, couple dozen people that work on that team and we just reliably focus on cumulative domain authority for all of our linking teams. And then we also have a secondary metric, which is what are the rankings for each particular keyword that each linker is going after? Each linker, I think works with a keyword at minimum for one month, so we will have, we might put out 20 pieces of content. We'll let them actually, we won't do link building at the beginning. We'll kind of let them chill, figure out who actually ends up in the top end of the SERPs. So maybe out of those 10 keywords, let's say eight of them seem to be in the top 20 results, and then we'll start to deploy a linker to a particular keyword. Once we figured out that it's going to settle and start (inaudible) link building to get it up to top three results as an example.
DA: 35:00
Yeah, no, that's fantastic. It's a great system and it's true, a true example of doubling down because you built an entire fabulous system around the three parts of SEO, kind of the research process, the content process. Then the backlinking, the distribution and backlinking that you guys have done. And I love, I always love moving from quantity to quality. And that's what you guys have done with those backlinks where you look at them from a quality perspective rather than just, Hey, let's flood backlinks, which you know, again is something that you can just spend a lot of time on without huge results. So that, that's amazing. And it really paints a picture of how you've been able to just build up this huge source of SEO and content initiatives there. And looking back over the past few years as you've built everything out that these, these longer term content marketing initiatives, other things like your events and stuff like that, are there any hard lessons you've learned from things that you really taken away as, as lessons that you would maybe pass on to other people?
LM: 36:00
I mean that's a longer podcast and I think we have time for, but that's a whole podcast by itself, right? I would say one of the biggest lessons that I had for SaaS was a don't do free betas. That's probably one of the biggest lessons that I learned. I would have been so much farther ahead if we hadn't spent nine to 12 months in a free beta, get people to pay you a buck for just like beta access or something like that because it's so difficult to be able to get meaningful feedback. And the feedback that you would get from a free customer may actually take you in the opposite direction from the feedback from a paying customer. So when we started, when we went from free beta to paid, we had, I think only about 6% of our user base went over to the paid product, but we tripled in hours tracked.
LM: 36:57
So only that small little 6% of our customer base actually tracked three times the amount of time as the entire month previous. And they also were sending us something that we really needed, which was hate mail. So before that we weren't really getting any mail from or emails from customer support saying, Hey, I hate this product, or Hey, this feature is broken, those types of things. But once they started paying for it, that 20x and that was so much easier for us to be able to iterate on our product because we actually had paying customers that cared about what we were doing. So yeah, I mean for me, if you're at the very beginning there, go from get out of free beta as quickly as humanly possible and preferably never do a free beta, just charge something, charge someone a buck.
DA: 37:49
I agree with that lesson. We actually learned that ourselves. We did three months of a free beta and then we did that transition. I think we had like maybe a 10% 12% conversion, but it's still very low. But the feedback totally different and you're right, I like to call it like a minimum economic viable product, right? At least you know you have a product people will buy. The problem's big enough. The feedback you're getting is correct. I think there's like this rush to always just bring in users, but you want users who are actively using the product to help you make the right decisions for building the product and hype and price and all that kind of good stuff. But that's super helpful and I think you've done a fantastic job today. Just kind of talking through where you see one SaaS going, SaaS B2B market going and then how to kind of build that marketing moat. But based on time here, what want to do now is flip over to our lightning round questions. Just five quick questions that you can answer with the first best thought that comes to mind. You want to get started Liam?
LM: 38:45
Sure. I'm ready.
DA: 38:46
Alright, let's do this thing. What advice do you have for early stage SaaS companies starting marketing today?
LM: 38:54
Don't think of it as a funnel. Think of it as referrals. You should never look at a customer acquisition as the end point. You should look at it as the beginning point for building more customers. And that completely reorganizes the way that you think about marketing. and it organizes you in a way that will actually make you successful over the next couple of years.
DA: 39:17
I liked that it also brings in a lot of the thought process for product marketing as well as like what can we build to add more value? So you're really thinking about that as like an aligned metric there. What skill do you think is vital for marketing teams to improve and build on today?
LM: 39:33
I would say probably understanding product deeper. I think at this point if you do not, if as a marketer you do not understand how to change your products and make it better so it's more viral or there's a bigger cake coefficient inside of it, you are not going to succeed long term. You may make a little bit of money here or there, but you're not going to actually get to the point in which you have net negative revenue churn as an example, which is really what everyone needs to be able to get into. I would say that that's probably in my definition, the definition of product market fit is if you've got negative revenue churn and a very few companies hit that.
DA: 40:22
Very few companies. That is the Holy grail right there. That's fantastic answer though. What about a best educational resource you recommend for learning about marketing or growth?
LM: 40:31
Oh boy. That's honestly a hard one. The, the author, it's a company, a book called Traction, the traction book from the founder of DuckDuckGo. I found that that was a fantastic book when you really look at like the tactics of how to actually build a, a tech company or a SaaS company because they review every single major funnel that, that SaaS companies use to be able to build their companies. So that would probably be one that I would suggest. We usually take a look at that book once a year once we've kind of done our yearly review and then we figure out, okay, what we're going to do next.Tthat actually was one of the reasons why we built running remote our conference because we said to ourselves, well, we have some free time. Maybe we can invest in actually building a conference as a completely separate funnel and it worked out.
DA: 41:32
Yeah, definitely. That's, that's a fantastic book and we'll make sure we link to it in the resources. Basically they talk through like when to get started with marketing and a list. I think what, like 25 different marketing strategies that companies can use and they're not all one size fits all, but definitely jumping off points for, for companies. What about a favorite tool? You can't live without
LM: 41:51
My anchor 20,000 million power portable battery that's USB powered and or USBC powered it. It can recharge my laptop twice or recharge my phone like 20 times and I take it with me everywhere. Yeah, it is the best. It's 60 bucks on Amazon. it is absolutely awesome. And you put it in your bag and I can, I mean I do a Pacific crossing three to four times a year. No worries. I'm completely cool. I've got power the entire way.
DA: 42:24
Yeah. I have this tiny little battery I need to get a better one. So that's a great, that's a great tool. What about a brand business or a team that you admire today?
LM: 42:32
I'm going to use Shopify cause I'm looking at them right now. I'm right across from their head office here in Canada and they've been able to, I think when you look at SaaS more specifically, so once you get into past product market fit and you really start to generate revenue, it's not so much about the, it's not so much about user acquisition at that point. It's just maintaining the growth curve. And that actually I would love to be able to talk deeper about maintaining the growth curve because in almost all SaaS businesses that I've seen as an investor or just an advisor, there is a collapse point. So maybe it's like three to four years in the business where you're doing 150% year over year growth and then all of a sudden next year you're doing one 30 and then you're doing one 20 or one 10 and you just see that attrition and basically at that point it's literally just a game of protecting yourself against that attrition.
LM: 43:37
And I think Shopify has done an absolutely amazing job at recognizing that they're building this massive business. Do they want $150 million business or do they want a $10 billion business? And by understanding that attrition coefficient, they've been able to basically get past that point. And it's something that I didn't really recognize was so important in SaaS until we got to scale where for us to be able to double the business is actually four times harder than it was two years ago. And that's something that is just such a huge project to take on and you need to build so many other pieces to understand where you need to go, to be able to hit those types of numbers. So Shopify has done a fantastic job. They're profitable. They're there. I mean it's crazy. There are tech startup that's profitable and they're public, so I have a lot of words for what Toby's done. Yeah, exactly. I mean I owned some Shopify stock and it's been killer. They are just doing a fantastic job because they understand their core fundamentals.
DA: 44:44
Yeah, no, they're a fantastic company and I was really well said about attrition and I think we could have a totally a whole another podcast episode talking about, you know, understanding churn and adding product value and reviewing acquisition ideas there. But based on time we'll wrap up for today. I mean, you've been an amazing, amazing guest, so knowledgeable sharing, so much information with us. So I just want to thank you for your time and thanks for jumping on the show with us.
LM: 45:10
Thanks for having me.
DA 45:10
It was real pleasure and we'll talk to you soon. Cool. That was quite the phenomenal podcast episode learned a lot. There's a lot of macro economic things to think about happening right now and very interesting to think of where SaaS is going. But more than anything important that you prepare and have the knowledge to know how to protect your business within marketing, building those moats. Big shout out to Liam. Thank you so much for joining us today. (...)
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