A Product Market Fit Show | Startup Podcast for Founders
00:28:47 · Anurag Goel, Pablo Srugo
[00:28:47] S0: I think that was the biggest launch move you can have as a startup. And so then we relied on just word-of-mouth. And in the very beginning, actually, we just enrolled our friends. I went and spoke to everyone I could, and I was like, you need to move your site to this. And often, I just did it for them. That's how you do it at the beginning. Right? [00:29:06] S1: Yeah. How you know, talk to me about that because this is, like, really, really important at a certain point. You know? Like, if you've already got an app and it's already in production, the Valve Pell is maybe not as clear. Like, you have to find there's a point in time where it's like, holy shit, I really need this. And then you do the work and you got it and you're like, yeah, okay, I guess. How did you work that? Like, that's not that simple. [00:29:24] S0: No. I just like, look, this is the future. You're using an an antiquated product and this is gonna be better for you. [00:29:30] S1: Like, hand to hand combat. Like, you would just convince them, you you should just switch. Yeah. Is that where the credibility comes in? Like, that's you had a relationship. They had credibility. They're like, okay.
00:29:30 · Pablo Srugo, Anurag Goel
[00:29:30] S1: Like, hand to hand combat. Like, you would just convince them, you you should just switch. Yeah. Is that where the credibility comes in? Like, that's you had a relationship. They had credibility. They're like, okay. [00:29:40] S0: That was part of it, certainly. But then also, I think that our product was meaningfully better in certain ways. And so I think it was a combination. And, yeah, I I think developers often wanna use new things, and that always plays to our favor, or it did back then. And I wish we had more users early on, but I think the users we had were really helpful because I could get real feedback from them. And some of them put very critical things on the platform. And, you know, looking back, if I were them, I would think twice knowing everything I knew about Render. But, you know, the Pete Buttigieg campaign ran all of their infrastructure on Render in '20 I think it was 2019. And they did not have the smoothest of experiences, but it certainly told us how to scale to national level traffic.
00:29:40 · Anurag Goel, Pablo Srugo
[00:29:40] S0: That was part of it, certainly. But then also, I think that our product was meaningfully better in certain ways. And so I think it was a combination. And, yeah, I I think developers often wanna use new things, and that always plays to our favor, or it did back then. And I wish we had more users early on, but I think the users we had were really helpful because I could get real feedback from them. And some of them put very critical things on the platform. And, you know, looking back, if I were them, I would think twice knowing everything I knew about Render. But, you know, the Pete Buttigieg campaign ran all of their infrastructure on Render in '20 I think it was 2019. And they did not have the smoothest of experiences, but it certainly told us how to scale to national level traffic. [00:30:32] S1: You know, let's go deep on that because if I understand correctly, you got the 10,000,000 ARR with no marketing spend and no freemium. Like, you literally you had a free trial, and then you have to, you know, convert to paid. I'm thinking about this from the perspective of a founder. One of the key things that we've hopefully established so far is nothing works unless you have a product that drives a lot of very clear value, hopefully as fast as possible, cause that is the core that drives word-of-mouth. But what else did you do or what did you wrong, right, on that path to 10,000,000 ARR? Because, you know, not spending on marketing and not having freemium, like, that's a very unique place to be in.
00:30:32 · Pablo Srugo, Anurag Goel
[00:30:32] S1: You know, let's go deep on that because if I understand correctly, you got the 10,000,000 ARR with no marketing spend and no freemium. Like, you literally you had a free trial, and then you have to, you know, convert to paid. I'm thinking about this from the perspective of a founder. One of the key things that we've hopefully established so far is nothing works unless you have a product that drives a lot of very clear value, hopefully as fast as possible, cause that is the core that drives word-of-mouth. But what else did you do or what did you wrong, right, on that path to 10,000,000 ARR? Because, you know, not spending on marketing and not having freemium, like, that's a very unique place to be in. [00:31:10] S0: I mean, honestly, I made a mistake, and I think we should have had a free tier sooner. Everyone else had a free tier, and we decided not to have one because we thought that we really wanted a certain kind of persona where people would come to us for real production applications, and they would get enough in their first month to try us out. But that was severely curtailing our total sign ups. Because a lot of people would never try something even with their trial if they have to pay anything at all. And so we introduced our free tier after we raised our series a. [00:31:52] S1: How long from zero to 10,000,000 ARR? Like, how how long did that take? [00:31:55] S0: Oh, it took a while. We reached 10,000,000 around maybe the end of twenty twenty one or the beginning of twenty twenty two.
00:31:55 · Anurag Goel, Pablo Srugo
[00:31:55] S0: Oh, it took a while. We reached 10,000,000 around maybe the end of twenty twenty one or the beginning of twenty twenty two. [00:32:08] S1: And you launched 2019. So, like, two to three years? [00:32:10] S0: Three years. Yeah. I mean, from the founding of the company, certainly almost four years to get to 10,000,000 ARR. And, like, VCs wouldn't fund a company like that these days. Yo. These day but these days, everything's cute. You don't want [00:32:22] S1: you can't you can't compare it to these days. In normal days, even in those days, I mean, you know, from launch to 10,000,000 in in three years, I think, was because, you know, we used to talk about, you hit a million, then you triple, you know, triple, double, double. That's kinda gone, but you're more or less on that path. [00:32:36] S0: The other issue was that we hadn't quite focused on building efficient infrastructure from the beginning because we really just wanted to get applications on render. And then when we started offering a free tier, our burn increased significantly. And then we also realized that we had to focus a lot more on making our infrastructure more efficient. So we are just spending less on the cloud and not giving away a dollar for pennies. So a lot of our work in 2022 and some part of 2023 was less on building features and more and it was still a small team, but was less on features and more on just making the system more efficient and having our cloud costs be more aligned to our revenue.
00:32:36 · Anurag Goel, Pablo Srugo
[00:32:36] S0: The other issue was that we hadn't quite focused on building efficient infrastructure from the beginning because we really just wanted to get applications on render. And then when we started offering a free tier, our burn increased significantly. And then we also realized that we had to focus a lot more on making our infrastructure more efficient. So we are just spending less on the cloud and not giving away a dollar for pennies. So a lot of our work in 2022 and some part of 2023 was less on building features and more and it was still a small team, but was less on features and more on just making the system more efficient and having our cloud costs be more aligned to our revenue. [00:33:25] S1: But, you know, one of the trade offs that you must have done, I'm curious on your thoughts on it, are like, you've put this product out, people love it, you get organic word-of-mouth. You can always drive more growth through not just freemium, but through spend. I mean, you could spend into it. But you always have this trade off of do I focus on spending, getting more people, more awareness, more whether it's PR, Paymark, whatever it is, there's always a way to drive spend and and get more growth. Or do I just focus on investing that time and resources into my users and building the product and the features? There's always this trade off. Like, it seems like you focused a lot on the latter, and I assume that was by design strategic, but maybe tell me more about the thinking there.