This is the story of a founder who kept getting hit up for hiring help from his friends and finally decided to create a company to systemize the kind of help he was giving.
Ben Baldwin is the founder of ClearFit. You know how when you hire, you want to place ads on multiple job sites, like LinkedIn and Career Builder. But when you do, you get flooded with resumes that are hard to sort through? Well, ClearFit does the job posting for you and then goes through them and makes sure that you only talk to people who are a good fit for your company.
We’ll find out how he built his company.
Ben Baldwin, Clear Fit
Ben Baldwin is the founder and CEO of ClearFit, the app that fixes hiring.
Andrew: Hey there freedom fighters. My name is Andrew Warner. I’m the founder of mixergy.com., home of the ambitious upstart and the place where you come to hear interviews with some of the most successful entrepreneurs in tech, who tell you how they did it, break down their process and hopefully what you will use from them will not only help you build a successful company but will encourage you to come back here and let me interview you after you do it so you can complete the circle.
Today I’ve got the story of a founder who kept getting hit up for hiring help from other business people and he decided to create a company that systemized the kind of help that he was giving. Ben Baldwin is the founder of ClearFit. You know how when you want to hire someone for your company you have to place ads on multiple sites, which is kind of a chore so you go to LinkedIn, Careerbuilder etc., and then when you do that you get flooded with resumes and they’re hard to sort through and find the right people. Well, ClearFit posts the jobs for you and then goes through them and makes sure that you only talk to people who are a good fit for your company.
We’ll find out how he built his company but first I’ve got to say thank you to Andrewswelcomegate.com. Yes, I’m kind of thanking myself. Here’s deal with that. My sponsor today is a company that creates a page that allows you to collect email addresses from your users. I’ll explain more about that later on if you want to peek ahead to Andrewswelcomegate.com. First I’ve got to welcome Ben. Ben, good to have you on here.
Ben: Thanks, Andrew. Great to be here.
Andrew: What kind of revenues are you guys doing right now?
Ben: So, we are tripling our revenues from last year. What I can share publicly is that we’re definitely over a million. The magic number for us right now seems to be tripling everything so, if you can triangulate a bunch of my responses today to get at the actual growth rate it’s definitely over a million. We’re not a hundred million yet but we definitely see ourselves getting there.
Andrew: All right. I’m glad you feel comfortable talking about that. Before we started the interview I asked you are you feeling comfortable with the revenue, are you feeling comfortable with over a million, you weren’t so sure, and I’m glad that I hit you with the first question that you were being that open.
Ben: We’re proud of our growth and we’re usually pretty open and I just get advised against being as open as I typically am, but it’s easy with you, Andrew.
Andrew: Well, thank you. I appreciate that. There’s so much that I want to talk to you about like how you got there, like the pricing structure on the site is really important, but why don’t we go back in time and just get to know you before I keep pushing you for more data. You’re a guy who started out as an entrepreneur. You actually use to sell flowers when you were a kid. How did you do them? How did you sell them? How did you do them?
Ben: Well, to qualify myself as a kid, I think I was able to walk at that point. It was selling people dandelions from their own lawn, I think. So, I thought that I was selling these things for 25 cents a pop and I think that they were paying me to weed, was actually how it ended up working out. But I made sure that the dandelions could regrow so I think I was the one who won there.
Andrew: You’re saying that you’d walk over to – was it a stranger’s lawn or your neighbor’s lawn?
Ben: I think we’re talking like I was four of five, maybe six, during the era when you could just cross the street and sell stuff if you want. It’s cute, so yeah. These were people I knew and I was under the watchful eye of my parents but yeah, ever since I was young I thought that there was always something someone needed and I could probably provide them help with that.
Andrew: You know Ben, not to get too psychological on you, but I used to think that the reason that I was so determined to start a business, to work hard, was that no one really got me as a kid. That girls weren’t in to me and that I had to fight back against the world by channeling all that energy into work, and that if I ever got comfortable and people were comfortable with me, and girls were into me, that I would lose my edge, my need to be in business.
Having done these interviews and gotten to know myself a little bit, I realize maybe there’s an inner need to sell or an inner need to create businesses and an inner entrepreneurial desire. When you tell me that you were doing this about the time that you could walk at five, six years old, is that because of that inner desire? Am I picking up on that?
Ben: I don’t know what it is. I may like being rejected. I don’t know if that’s part of it but I do know that that’s an important part of whether it’s sales or certainly starting a business. It’s actually what’s helped ClearFit grow. We wouldn’t know anything or have built anything good without being rejected by customers the first way we built it. So I guess you could call that crowd sourcing in a way.
Andrew: Are you saying that even as a kid you didn’t just like the sale but you liked the rejection because it gave you something to work against? Gave you something to improve on?
Ben: Yeah, exactly. It’s a way to engage. I guess when winning’s harder it becomes more fun. I don’t know if that had something to do with it but I definitely looked at the relationship creation part as being great and I really took a great pride in those grumpy neighbors who were really resistant at first and then I was able to break through so maybe it’s that challenge thing too. I like that.
Andrew: The small businesses who I mentioned were asking you for advice on hiring, why did they come to you? Why did they say “Ben’s our guy to go to and ask?”
Ben: Maybe I was right for them at the time? No, my background is in helping large organizations to predict who’s going to succeed in their roles, for instance big pharmaceutical companies and the way that used to work is it used to cost around a million bucks a year like around a 100 grand to set up for each job and then that took four or five months to get set up and then five to fifty thousand dollars a month to operate and it worked really, really well and friends knew about that. They came to me and said ‘hey, do you have a buddy plan?
Like, my business is growing so our sweet spot at ClearFit is businesses that are 20 to 400 employees, so I have some friends who are running companies that are going really well. Their problem with hiring was they couldn’t afford… a big drug company, you can afford in many ways, to make a hiring mistake but they couldn’t afford it and my problem was that they also couldn’t afford me. My buddy plan was around 20K, so I wasn’t a great help to them plus they needed something they could set up a lot faster so that became the gnawing or the challenge that founded the sort of founding insight into ClearFit.
Andrew: When you were charging 20 thousand, what would somebody get for that price? Just to give me a sense of where you started and how you were able to reduce the price.
Ben: It’s exact. Actually, it wasn’t even as good as what you get for free on the ClearFit site as part of the file but what I would do is first set up and account and we’re talking like ten years ago. This was manually doing a lot of this stuff so I’d set up an account and I would create a success profile of top performers for one of their jobs like common jobs for us are sales and customer service.
Andrew: So you would profile the people who were already doing well at sales and customer service to understand what it was about them that was so impressive that you need to get more people like them?
Andrew: And how would you do that?
Ben: We put them through a little survey, and then we asked them a bunch of different questions and we also have some existing knowledge on different roll types and sometimes we’d come up with some counter-intuitive surprises and that’s the past that’s really exciting.
Andrew: Example of that?
Ben: Sure, well, a traditional sales role as an example has… you tend to find less structured people but every once in a while you’ll find a sales organization. I won’t mention any names of one we’ve worked with but I like this where their need for structure with the sales roles is extremely high, which is an outlying attribute and not visible at the surface so people can be just as gregarious with but if they need structure that’s a real difference for their sales people so identifying that and recruiting other people who have that attribute is really important. So, taking the time to really discover that it is that contributes to success and not just looking at what’s observable, that was what took the time and then setting up the software and keeping it running was a whole different chore there.
Andrew: And what did the software do? So, you’d do some surveying, you’d have an understanding of what the ideal candidate has, you also mentioned software… what did that do?
Ben: The software linked into their other systems, so they might be using job boards, they might be using applicant tracking systems, whatever software they had at the time. Remember their different types and sizes of organization back then but that’s why the buddy deal was so expensive at 20K. So when we started ClearFit we just wanted to make hiring easy. So, it’s all in one bundle and we don’t talk to you about how awesome our science is because you usually don’t care. The thing that you think is awesome is not having to read a lot of stuff so we make it super easy in five minutes for anybody to try out and the biggest difference there between the solutions I was providing for a million dollars for 20 thousand dollars was you kind of had to wait and see what it looked like, success.
Sometimes we really only realize that a rep is really good, like a pharmaceutical sales rep, after three years. But, with ClearFit you can run yourself through the program if you want, you can run your top reps through so you can see success really, really quickly and that was something that when you go back to the flower story feeling a sense of gratitude is something that’s really important too. So not only your friends say “Hey, you know what? I don’t have 20 grand lying around to do this and also I don’t want to wait for a while to see the success come through” so something that’s really rewarding is not just seeing how easy it is but how quickly they get results is something that for them is great but also selfishly for me it makes me feel pretty good when people set up a program and give you feedback right away that it’s working for them or to an earlier point “Hey, why don’t you take this feature out because it’s confusing?” So making it easier.
Andrew: What we’re trying to get into that happened a little bit, so the idea was you were doing this for big companies, you saw that people were asking for you for a buddy deal and even the buddy price that you were giving them wasn’t discounted enough because they were too small. You said there needs to be a solution for this. The solution’s probably going to be more of the software solution than me doing the work personally for them.
Andrew: The first step that you took for it had to do with Jamie Schneider. Who’s Jamie Schneider and why was Jamie so important?
Ben: So Jamie’s very, very important because he comes at business from a completely different perspective. I’m the crazy, you know, four-year-old selling flowers still. Jamie has a background in PNG. He’s a Harvard MBA and we met as we were trying… I basically came to Jamie with a question: can this big company stuff work for growing businesses like smaller businesses? Jamie at the time was helping Rodger’s build their small business strategy and how they -a big telecom company up here- would approach small businesses and so he was the authority on small business and growing small business. I said ‘hey, is this peanut butter and this chocolate -the small business and this hiring tool- do they fit together?’ and they did.
The one difference that we both has to come up with together, which ended up causing a us both to found the company is it’s a lot harder than just making something easy to use. The growing businesses wanted new stuff so it was quite a path of learning that we both took together but the two of us are very, very different people and so that actually helps quite a bit as we kind of both make a complimentary pair.
Andrew: I see you guys are both co-founders and also co-CEOs. You get together, you say ‘look, you’ve talked to all these companies that I would like to be customers of this new business idea that I have, do you think it will make sense?’ He says sure, it will; you now have to start creating this system, a simplified version of something that you are selling for hundreds of thousands of dollars… millions of dollars you mentioned. How do you simplify it and then make sure that customers really want it?
Ben: Really good question because we were surprised by the real answer, so, what we did was we made it incredibly easy to use. So, instead of four to five months of set up and a hundred grand per job, and then five to fifty thousand dollar a month to operate we made something that was as easy… it took five minutes to set up. You could set it up for free and the number we originally thought of was hey, why not 99 bucks per month? So, for us we thought that we were champions when we brought it up and the market did not think we were champions because they had no idea what we were charging for what it was. So, crazy idea, why don’t we increase the price to 349 dollars and see what people do because you do some experiments at the beginning, right?
But, most people think of not that drastic of a price increase but what happened was not only did we make, I guess, more money per customer but the number of customers went up alarmingly because they understood where to find the money. So $99 for what? Where do I find the money, the $349 was a realization for them. They told us “Oh, so it’s like a cheap job posting”.
Andrew: I see. I see how 300 in change seems like a cheap job posting so it registers in their minds and they say okay we’ll try it, we try job posting all the time. Why couldn’t they see 99 dollars as a super cheap job posting?
Ben: That was the… it was just funny for us, like a that’s what I thought would happen but they viewed $99 as more of a subscription fee and out service is more closely related to a job posting so we charge similar to job posting. It can be as much as… if we funnel them together it can be a thousand dollars for 30 days for a whole bunch of different job postings and then the screening just kind of comes out from that; the whole success prediction process, intelligence and interview questions but customers look at price -especially our customers- so because our customers are growing businesses price is really important to them.
First, the most important thing for them is time, so they have to be able to understand it really easily or they’ll just shut their computer down and leave of someone will interrupt them. But, if you can get value in the first five minutes for them the second thing that they’re looking at in those five minutes is price. What does it cost and that price informs them. So, signaling what type of service it is… it kind of has to be priced in a similar way because that’s such an important signal for them.
Andrew: It’s shocking you raise your prices and you got more customers and revenue. What I’m curious about is how you took this big project with a lot of expenses and simplified it so that you could charge $99 and have it make business sense. What did you cut out or how did you simplify it to make it work?
Ben: We have a number of patents. The early days, when it was Ben in front of the whole executive team at the big drug company, I used to look young. When I was 26, I looked about 14. The way that I would present is to let the data speak for me. The other PhDs that I was competing against for the different hiring processes practically had their white coats on and a team of 20 people. They could speak from experience, and I couldn’t do that. Letting the data speak, having slides that spoke for themselves, and having a process that made information transparent really is what did. We could just bake that into the software and that became automated where customers could get that information themselves.
From that point on, when customers would get confused about certain things, one of the greatest tools ever invented was the 1-800 number for product information. When customers call it’s for two reasons: number one, credit card when they’re uncomfortable entering it over the Internet; and number two, not understanding a feature or what something does. We started eliminating things that people had more questions about.
Andrew: You put the phone number on your site after getting the idea from Freshbooks. They put in on their homepage so you put it on your homepage. You were worried that you would get too many phone calls, but then realized there would only be two reasons why people seem to be calling. Either they want to give a credit card, or they have a question about something that’s not working. Helps make the product better. Maybe I’m not asking the question right. If the product was so tough that you couldn’t even do it for $20,000 because you had to profile a customer and spend time sourcing through the data, how were you able to simplify that? Profiling a customer is a pretty tough process. It takes time and that’s one of the reasons why you had to charge so much. How did you make that process simpler?
Ben: It literally relates to the 1-800 number. It was removing stuff from the process and having it all happen under the surface. Moving everything to the Cloud made it a lot easier, so when we upgrade or simplify something for one customer, we simplify it for everybody so everybody’s working on the same process as we learn and as we go. We’re also working with much more scalable equipment. One of the things we’re really good at is hiring. We’ve brought in some great engineers and fantastic product people who have been able to tailor the product in a way that makes a lot of sense to the person who is using it. It is less to do with the product and more to do with really figuring out what your customer is after.
One of the things that we implemented that made our whole product more scalable was talking more about finding our customers candidates, because that’s what they want, as opposed to helping them screen candidates. When you talk about screening you’re going to get into a very consultative relationship. Our customers have a fire and want someone in a role yesterday.
Andrew: Got it. That’s why, when I look at the pricing page, the basic package, $349, gets you lots of applicants. The plus gets you more applicants, and the pro gets you the most applicants. You’re really being clear to them that you know their biggest problem is they need applicants and need people to hire, and you emphasize those things when creating the packages.
Ben: To be frank, the thing that made us the most scalable was that it was less to do with how amazing the technology is and more to do with which problems are the most important to the customer. Putting out a fire lets the customer move a lot fast and require less consultative work.
Andrew: So today you don’t go into the company and say, “Let’s see who your best performers are, let’s study them and survey them.” Today you say, “I understand your company based on a form you fill out on our site, is that right?
Andrew: And I also have all of this experience hiring people.
Ben: So they can still do that. They can customize, but we do that a little later after they’re comfortable with who we are. So they can come in and they can try it. They can try it with . . . They can customize right away, but typically our customers kind of get their feet wet first, and then they can customize the roles around their top performers. They can definitely still do that, but the way we made it easy as opposed to inundating you with information when you first come to the website is really what makes it simple.
Another thing that’s the old school but adds it on a scalability is we actually, and we learned this from Constant Contact, we have . . . Constant Contact is marketing coaches for every one of their accounts. We have hiring coaches for each one of our accounts. So every single customer who signs up gets a real-life hiring coach not a Constant Center person.
They’re sitting right over there. And they really care about our customers. We’re very careful to pick the right people to care the most about our customers, and just knowing that you have someone who’s looking over what you’re doing. That creates a lot of viscosity and reduces the amount of fear and worry that happens typically with hiring because people worry that they’re going to get the wrong person or am I wasting money. Am I posting on the right day?
Having an expert is remarkably scalable too. So you actually get to interact with a real person who works at ClearFit and they help you with their needs because they’re very, very similar to most people.
Andrew: I did a search on archive.org to see what the original product looked like, and it seemed like at first you were catering to employees. You were helping them find the right job.
Ben: Yeah, good research skills.
Ben: You’re taking a page like, really, I could barely remember that. But, yeah, so one of the challenges here is having a two sided equation. So you have the small business owners who are looking to hire, and you have the candidates. What we learned pretty quickly was that you have to focus as much as possible on one customer and if you can partner for the other.
So what we did is there really weren’t companies creating satisfactory relationships with businesses that are 2-400 employees. So that had to be . . . So we were the ones that were going to create these great relationships with the growing businesses. But they were other companies like Monster, LinkedIn, Indeed, Simply Hired, Craigslist where the job posting process was working pretty well, so we could partner with them. And so we’re closely partnered with all of those different sources on the candidate side.
Ben: But we really take care of the growing employer’s needs in our house.
Andrew: That’s really good advice. So if you’ve got a two sided marketplace, instead of trying to be the best of both sides, pick the one that you’re going to focus on and partner for the rest. I see. So that’s why the original site, I think, said, “We’re going to help you get job candidates.” Then it switched to “We’ll help you, the job candidate, help you where you can find a good job.” It seems like you were recruiting job candidates, and then you said, “No, we’re going to partner with these other sites and get the candidates. We will focus on the businesses that need them. That will be our place in the market.” Got it, okay.
Here’s the other thing. When you started, you told April Dykeman in our Mixergy pre-interview you built it. You simplified it. And still no one bought it. Why didn’t they buy after you simplified the UI, after you lowered the price? Even at 99 bucks. What was it that turned them off?
Ben: So this is part of the pricing discussion where if you say it’s $99, I think people and, at least, that’s what we heard from people who bought and people who didn’t buy, was if it’s $99 they assume it’s monthly. And something, we have a saying internally here. When you’re first creating a relationship with a growing company and they think about hiring in general, there’s some things you don’t want to pay a subscription for. So the saying is, “Hamburgers, haircuts, and hiring.” You want to buy those one off. Maybe you’ll end up with a subscription later, but there’s some things you want to buy sort of as you go.
And that’s what we’ve learned with hiring as you’re a growing business. Now we have customers who are on subscriptions, and that happens as they grow. They get a greater sense of comfort with you, but it’s also it signals a different type of customer. If you think of subscription, then you’re getting more of an HR customer. If you thinking, you know, this is to help with the hiring, you’re getting the hiring manager or the business owner.
Ben: I see.
Andrew: Actually it’s funny if you speak, it’s such a slight variation. Where when we increase the price, we are actually signaling people who were just about to use a recruiter. So the customer says, “I’m just about to spent ten grand and a few hundred to see if ClearFit works. And then they kept coming back. So that’s the way we get our customers now as opposed to having a sale that is a little bit like an HR or system sale. We’re not like that. Our value proposition is we’re going to get the right person in that seat so we tend to compete more with lower-end recruiters, which is a totally different world.
Andrew: And that explains too, why I think I saw a Frequently Asked Question underneath your pricing page that said is there a monthly subscription fee and right away you say “no there isn’t” so even now that’s a big issue for people. So, if increasing the price with 349 increases your sales, that’s what did it. What happened when you increased to 700 or 750?
Ben: They went up again.
Andrew: Again? So you just increased the price, more customers.
Ben: They want more candidates. So, this is again the assumption. You look at something and you say the features are the same except the price goes up. So, you probably get more candidates. So, this is where we had to be really careful. Our customers, and most customers frankly, don’t read. They shouldn’t have to, at the same time. It should be intuitive. If you’re charging more, what’s more value that I get. And in our case it’s more customers. I’m sorry. More candidates for your job because we will post in more places. Time is a really difficult role so we can’t get you 500 marine biologists if you’re in Kansas, although sometimes we get requests like that, although sometimes we get requests like that.
So just [inaudible] some more people from a broader array of sources. That’s the way the pricing worked for us. So, you actually end up saving. By spending more at our site you end up saving in total, on the different services as well, because they all get combined on the same account. It saves you a bunch of time through ClearFit versus going individually to each of them.
Andrew: Do you partner with Careerbuilder, LinkedIn and Monster or can you just go in there and use your account and manually add the job listings?
Ben Yes. To both. Some of our customers will go through us because we have again . . .
Andrew: Oh sorry. I apologize. I mean ClearFit. Does ClearFit happen to have a partnership? You clearly don’t have a partnership with Craigslist. That’s someone going in and manually adding it or system on your side that adds it. Do you need a partnership with Monster or LinkedIn or do you just say to one of your employees add our listing on those sites?
Ben: Yeah. So, a lot of those companies, the companies I mentioned, we have either a partnership or as much of a partnership as you can, like Craigslist. There are other sources for specific industries where it might be a very obscure job board or someone might be using a recruiter and so they have their own sources. We also work with those sources. They can come into our system and it’s just a simple link where people come into our process. You tell your candidates hit this link and you’re in ClearFit. That’s really, really simple for any source but we can go directly and save you time with the ones we partner with.
Andrew: You use the word simple a lot. Simple, simple, simple. The earlier versions of your site had instructions which bothered you. Why did that bother you?
Ben: The instructions were real hard to write, strangely. Wow. No website should ever have instructions. That’s a primary example of why something used to cost a hundred grand to set up or 20 grand for your buddies. There’s all these instructions versus now where we don’t expect you to read. It should all be intuitive by the way everything’s set up. So, for us, we thought we were being great friends by giving you what you – sort of killing the fly with a sledge hammer. Giving you the most robust solution but also telling you what we were doing in great detail, which caused nobody to buy it because it was so much effort reading the instructions that it was tomorrow by the time you were ready to set up a job.
Andrew: There’s something that a lot of companies do that you didn’t do. I’ll ask you about that in a moment. First I have to follow up on what I said at the top of the interview, and explain what AndrewsWelcomeGate is because frankly Ben, people are suffering. They’re waiting for me to tell them. Here’s what it is. When you build a website you are tempted to just look at hits but hits really don’t do enough for your business unless you’re in an advertising business, which case terrific. For the rest of us, what we want are leads. We want people who give us their email address, their permission to contact them so we can establish a relationship and later on sell to them.
How do you create a page that does that, well for me at Mixergy it took a couple years of work, a couple years of experiment. You remember me in the past talking about how a single lock image actually increased our conversions and then I found something better than that so I removed that and AB tested the works. Just kept AB testing until I came up with a page that explains to an audience of strangers what my business is about and allows them to give me their email address if they’re interested in starting a relationship with me and lets me email them and build that relationship over time.
Want to see what that page looks like? Go to AndrewsWelcomeGate.com, AndrewsWelcomeGate.com. Not only will you see what that page looks like, but you will actually be able to take that page, customize it a little bit to your needs and put it on your site so you can test it and see if it works for you as well as it does for me, AndrewsWelcomeGate.com.
You don’t have to code it up. You don’t have to know anything about how to code it up or develop it because it’s run by LeadPages.net. LeadPages is a company that maintains and really works to increase conversion that. I’ve gotten as high as 56% conversion rates on LeadPages pages. So anyway they’re managing. They’ve backending the page for you so you don’t have to do it yourself. All you have to do is go to AndrewsWelcomeGate.com, see for yourself, add it to your site in minutes and you’ll get to increase your conversions.
I’m not making this available forever. I don’t expect ti anyway. Get it now so that you can lock it in for yourself, AndrewsWelcomeGate.com. Were you going to the page right now? No.
Andrew: Yeah. Did you happen to see AndrewsWelcomeGate? No?
Ben: I am worried about messing up our interview because my computer doesn’t multi-task super well.
Andrew: Ah, you know what actually? First of all, I’m going to have to get better at those commercials. I want to do such a good job that someone will say I will wreck my whole company just to see the pages Andrew is talking about, number one. And number two that explains it. I have seen that our connection has been a little off. It’s most solid, like 99% solid. But they were a couple of times where I couldn’t hear anything.
Ben: You want me to go there?
Andrew: You did a formal launch. No, you don’t have to go there.
Ben: You did a good job talking about it. Now I want to go.
Andrew: I’ve got to step up my game. I’m getting better at these commercials. I’ve got to tell you, Ben, when I first started you’ve got a guy working with you, Mitch, right?
Andrew: Mitch is the guy who helps you find new . . . actually what does Mitch do for you?
Ben: Mitch is our VP of Marketing. He is, I guess, most people would describe it as the guy who helps us find more growing businesses to work with. But Mitch thinks of it differently. I think of like being, getting inside your customer’s head and being everywhere they are. So he’s the real customer advocate. He’s the VP of Marketing, the top of funnel. He is like your customer, and he’s your hardest customer but he works here. So he’s like our greatest ally.
Andrew: He used to work at FreshBooks. He was first person that I sold an ad to for Mixergy, and I tell people this all the time. Now they’ll understand and believe why it’s so true. I told him, “I don’t know how to charge for my ads. I don’t know whether FreshBooks will even work. Can you give me a sense if it works for you?” He took me in the mind of a FreshBooks user. He explained to me why free lancers need it, what’s going on in their heads that made them need an invoicing software, the fear that kept them from sending out invoices and following up et cetera.
Then he said, “Here are the sites that it works for. Here’s what I pay per user. If you think you can make it work, go for it.” And I was so nervous about doing those first ads which I’ll explain why I’m so proud today. I had my wife come in and do the commercials with me. I said, “Olivia, I need you to play off me. I can’t just talk into the camera and sell anything, you know. I’m still new at this.”
And I got comfortable and comfortable, and I’ll keep getting better until the point where someone will break their computer just to see a page that I talk about in the future. For now I’ll just settle with doing a really good job and helping out LeadPages. All right. The launch. You raised a bunch of money. I thought that everyone that raises a bunch of money needs to have a big mega launch. Why didn’t you have some kind of big launch?
Ben: Oh yes. Well, I’ve learned also through watching mega launches go bust. For us it’s really money to, sure, we used the money to hire, and we used the money to market. So it’s scaling the business. But we’re learning so much about our customers as we grow, and getting better and better. If we were to announce the first time that we raised our first round, ClearFit is this.
We’ve changed so much now, and that message is so bad compared to the messaging that we have on our site now that it’s hard to go back and erase what you did before. It’s kind of like a tattoo. So we’re constantly growing, and we’re growing along with our customers. And also, this is sort of a negative thing. We roll up our sleeves and literally we’re the customers.
And so raising money isn’t really what we’re celebrating. So we celebrate when a customer calls us and says, “You guys helped me hire an assistant. I haven’t been able to hire someone for years” or “You have removed so much stress from my life because ClearFit has helped me scale my sales team.” So really that’s what we celebrate. So strangely raising money is less on our radar [inaudible]. It just means that we have lots more work to do.
Andrew: You know, you’re in the hiring space but you still have to fire people like anyone else. Is it harder for you to fire because it means that you made a mistake and if you made a mistake for yourself maybe you worry about other people being able to trust you with hiring for them?
Ben: Interesting. Yeah, well, I think that there are a couple things. I think if you make a real mistake with your hiring then that’s something to be worried about. I’d say that one of the toughest things when you’re hiring is not really understanding the job. So, it has to be a match between the person and the job and sometimes jobs shift a lot faster. Actually almost always jobs shift a lot faster than the person. So, for us, when we were scaling we had to make a couple of changes in senior people just because in large part their jobs had changed so much in six months and 12 months because the company had changed so much.
That’s when we started putting processes and people in place. The people stayed the same but the job shifted and became quite different so sometimes it’s the rug gets slowly pulled out from underneath you in a startup and especially growing technology company. I think that that’s something that we see a lot of is there’s no such thing as a VP of marketing. That keeps changing over time. There’s no such thing as any stereotypical role. It could mean anything anywhere. Change is constant.
Andrew: The role changes but you’ve also hired people who weren’t a good fit. You told April Dykeman in the pre-interview “We hired a couple of people on the leadership team who were excellent at the job” – oh I see, that’s the one [inaudible] Here’s one. “Real low point because there was a drag” – all right. I misunderstood. Now having you talk about it makes sense. It’s not that they weren’t a good fit you’re saying they just couldn’t grow with the job.
Ben: Yeah, the job changed over time and they were more static then the changes with the job. So, I think the challenge that a lot of growing businesses face and ClearFit faced a lot of the same ones, is as jobs change what do you do. Do you stay with people and have them struggle in roles that they don’t enjoy and they can’t grow with, or do you hire people ahead of the curve. Do you hire someone who will be great and not great now?
That’s a huge debate that’s going on right now, especially in the startup world. Hiring very senior people but not being senior yet. Kind of like twiddling your thumbs like what do I do today. I’m here for a 50 person team and we’re at three. So, you’ve got to be able to balance the two or move through people as the company scales. So, that’s tough, right? All that sort of stuff.
Andrew: Another thing that’s tough, and it is especially for me be so much of Mixergy is me, letting go and not being so hands on and accepting that some things will get put up without me or done without me. You’ve had that challenge too.
Andrew: Where did you feel that challenge most. Do you have an example?
Ben: Letting go. I’ve written the majority of the patents that we have, as an example. So, I get in my mind something very specific around a product that I really want to see executed but when you’re working with people who are really, really skilled and for us I would say luck but it’s not luck, we’re the company that helps you find those people. We’re surrounded by such talented people, but letting, for instance, our VP products really build the product out and make decisions around not just what to do but what we’re not going to do Ben, so Ben, I know you want this but you’re not going to get it because this is going to suffer versus this, and when you first hear that it kind of hurts but then you realize that’s the way life is and focus is based on saying no to certain things and yes to others.
So having that level of filtering and level of perspective, and quite frankly, the level of expertise that may exceed yours, is something that’s really important. So, the unsettling parts happen with sure delegation and letting it go but it’s kind of a weird reaction when you give something to someone else and they do it better than you. It’s like careful what you wish for. You’ve got to be comfortable with that. So, I’m definitely comfortable with that.
Andrew: I guess I’m doing better but the part that’s a challenge is where they get to say no to you and it shouldn’t feel arbitrary. How do you set up rules or a structure that allows them to confidently say no we can’t do this because we have to do that?
Ben: That is our culture. So we have really well articulated values that are actually on the wall behind me. Every single one of our rooms has our values in it so that reminds you. It’s kind of like the law of the land. In particular, part of our values is to be very, very, very open and very honest and transparent, so if you’re thinking something and not telling me, you’re not being honest with me and that’s the way our company began. It was kind of best idea rules. Doesn’t matter who has it, it’s the best idea.
Andrew: What makes the best idea? I remember talking to Noah [inaudible] and he said when I worked for Mark [inaudible] it was very clear that our goal was growth and he said if I Noah, brought an idea to Mark and it didn’t help growth, there was no confusion about whether or not I should do it. He could just say it’s not helping us with our goal of growth and we’re not going to do it. Do you have something like that that allows everyone to know what they’re shooting for?
Ben: Yes we do. So, for us it’s new customers for life. So is this going to be a new customer but are they going to stick around for life. So a lot of companies talk about how many customers they have and actually they talk about how many customers they have but they’re really just registrations. When we say customers it’s like a customer but also a customer for life. So we’re very proud this month, for instance, adding over 200 hundred customers for life, because they are really deep and rich relationships for us, but the lens for everything for us is the customers’ eyes.
So is this helping the customer? Is this something that builds that lifelong relationship for them? So we really think about building what’s best for the customer, which sometimes means making something simple and not adding a feature that one customer wants and then we slow the product down for all the others.
Andrew: What gets us the most customers for life? That makes sense. If you saw my eyes wonder around it’s because I know I saw a TechCrunch article where you were deep in the comments and as you were answering that I found that now it makes sense. It was just one guy in the comments who, Matthew Pern [SP] who said your site basically does not look nice. It looks a little too old school. I think that was the phrase, and you said thank you but our data shows that it’s actually good at converting, and he comes back in and he says well think about what if it looked even better with all the conversions.
And then he starts going off on the minds of people in Canada drawn to it especially, and you said well Toronto is known for good people and the conversation went sideways. But the way you were able to respond to him, is a prettier site going to get us more customers for life? If it is then we’ll do it and we’ll adjust it but if all you want me to do is to look better so that I represent myself the way other TechCrunch sites do, that doesn’t work for us, and that is one of the rules. Do we get more customers for life with this new idea?
Ben: Yes. So, something that’s counterintuitive is that your customers may ask for something. This is the whole what of the Henry Ford car with the faster horse, right?
Ben: If you ask your customers what they want, sometimes they’re right, sometimes they’re not. So, for us that’s where data is really important. We do a lot of asking our customers what’s important. A lot of sitting beside our customers. A lot of being our own customer and really asking hard questions and getting in their heads. The only thing that really tells us whether this is working or not is whether it’s scaling with other people, so we do a lot of testing.
We found that slight changes in wording to landing pages on our site can affect conversions rates, can affect customers understanding of what it is that we do. It’s pretty crazy so we measure everything. Sometimes really nice looking pages do pretty well and sometimes surprising pages and wording does much better. But the key there is just measuring absolutely everything and that’s part of what Mitch does too.
Andrew: What else. I think that’s pretty much everything except we also asked you before the interview started, what book would you recommend our audience read and you said “The Innovator’s Solution.” Would that be the book you recommend?
Ben: Well, I think the “Innovator’s Dilemma” gets most of the press but I found that having a solution as opposed to a dilemma is kind of nice, so I read all of Clay Christensen’s books and I found the solution to be incredibly prescriptive. In other words, not I’m the best, here’s what I think, it’s here’s some deductive situations in business. If you do this it probably makes sense that this will happen. Here’s how these companies have done it, so tell stories. Here’s how you may be able to do it. So, the reason the “Innovator’s Solutions” was so impactful for me is I sat down early one morning in a Starbucks and started taking notes on the book and then all of a sudden those notes kept going and going.
That became the business plan for ClearFit and so quite literally as I was reading “The Innovator’s Solution” and I was probably on venti… I felt guilty sitting there for a while, I was on venti like probably two and a half and I had to stop writing because my hand was so jittery and it was after that, days later that I called Jamie and he and I met for the first time and kind of talked about whether building a hiring solution for small businesses would work. That was the catalyst for me was that book specifically, so I found it incredibly…
Andrew: Do you have an example of something you learned from that book that you were able to implement at ClearFit?
Ben: Sure. So there’s building for a customer who is not consuming right now so the small business hiring market has a whole bunch of solutions that were built for people who aren’t in the business of hiring. Hiring solutions built are for people who are in the business of hiring, like HR people, this is the correct way to hire. But we know that small business owners don’t hire that way. Small business owners and hiring managers, they’re very reactive where they try to do everything in one step as opposed to multiple steps.
Andrew: I see.
Ben: Even though that customer is the majority of all hiring in the world, the reactive hire, no solutions were built for that customer. So we decided to build a solution for that customer because they were a non-consumer. They were making due with all these other solutions that they found to be too administrative or cumbersome so we built something that was quick and easy. ClearFit became the service that made it super easy to just deliver the people who are going to succeed right into your in box.
Andrew: Your company web site is ClearFit.com. I’m trying to actually bring up,… I guess she is not there. Who is it who does the live chat on your site in that box?
Ben: Oh, [Georgana].
Andrew: I was on with her. I guess she is not on this moment but I had a couple of questions that I wanted to answer when I was preparing. She was so fast and she was so helpful and she was just right there and I’m really appreciative of her being there and helping me prep for this interview and thank you for doing this interview with me.
Ben: That’s great. Thank you, Andrew. I appreciate it.
Andrew: ClearFit.com. Thank you all for being a part of it if you found anything useful don’t tell me, frankly actually do tell me. I’d like to hear about it, but a better person for you to tell is Ben. Ben, what’s a good way for them to connect with you and say thank you for doing this interview, for telling me that I should increase my prices for teaching me so much about how to get more customers.
Ben: Well, publicly you can find me on Twitter @HeyBenBaldwin, and privately it’s Ben@ClearFit.com, so B-E-N-@-C-L-E-A-R-F-I-T dot com and that’s me. I’ll either get back to you publicly or privately based on which way you picked.
Andrew: All right cool. So find a way, and really as always start off by saying thank you. I’m going to do it right now. Ben, thank you so much for doing this interview.
Ben: Thank you very much for having me Andrew, it was a pleasure.
Andrew: Thank you all for watching.
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