Andrew: Hi everyone. My name is Andrew Warner. I’m the Founder of mixergy.com, where I interview entrepreneurs about how they built their businesses. I am so excited about this interview because I’ve been looking to understand this founder for years.
Here’s the thing, he created one of the first form software on the Internet, the kind of form that you could put into your website, believe it or not that used to be a headache to get a form on your website, a good one anyway. He created it, he monetized it, he built it up, it went really well, and we’ll find out how well it went.
And then, he comes up with this thing called Formspring which just took the web by storm for a period there. It was a site where anyone could ask questions and get answers, and it just became this huge social network. And sadly, it went away, almost as fast as it started. I was looking at your face just to get a sense of how do I say this, is it okay for me to say it went away.
I’ve gotten in trouble with entrepreneurs by saying that one of their businesses failed. People don’t like any of that. But it went away and I was like what happened? And I know that you’ve explored it over the years, Ade so I’m going to ask you about that in this interview.
And then he started another company that I don’t even know if it’s on his LinkedIn profile, and then now he’s got a new business called Jell. Jell is a software that I want to ask him about because I think we need it. His latest software helps organizations have better team meetings. We had our team meeting couple hours before this. I think we need some help. It’s everybody’s spending their time together and I feel like we’re wasting some people’s time, and I don’t like it, so I want to find out about that.
All right, so many questions I want to find out about, why would this guy who did so well with form software that people were willing to pay for go into social media, and then more social sites that no one’s paying for. And then did he come back to this tool for businesses that he can charge for because he got burned, or what he learned over the years? All right, all that is . . . actually wait, I didn’t even introduce you, Ade, what kind of what kind of interviewer am I?
Ade Olonoh is the Founder of among other things Formstack. Formstack I think of as form software. I’ve been hearing it called Data Management Solution because it lets you collect data, organize it, pass it on to other software that you use. And Jell this software that I’m really eager to talk to him about.
This whole interview is sponsored by two great companies. The first will organize your books and make sure that you know how much money you’re making each month, or losing each month, where the money is going, where it’s coming from, it’s called Bench. And the second is a company that will help you do email marketing right, it’s called Active Campaign. Ade, welcome.
Ade: Thank you, really happy to be here, and thanks for . . . I’m flattered by that introduction.
Andrew: So much I’m got to ask you about. You know what, let’s start with this. Formstack, how much revenue is it bring in now, let’s say 2017 excuse me?
Ade: 2017 we’re doing about 14 million in ARR.
Andrew: Fourteen million, annual recurring revenue?
Ade: Right, yeah.
Andrew: That’s fantastic. All right the new business Jell, is what, like three years old now at this point, maybe even four almost no?
Ade: Yeah, it depends on when you count. So Jell is actually a . . . currently a subsidiary of Formstack, so it really start . . .
Andrew: I didn’t realize that.
Ade: Yeah, so it kind of started as something we built for ourselves internally, and then we launched kind of an MVP out to the world trying to validate whether or not something that more people can use, other than just us at Formstack. And then really for about two years, we’ve had a small team on it full time. So it’s kind of been fits and starts.
Andrew: So here’s the thing, I want to understand your story and go in chronological order, but I’ve got to start with this first because it’s just been on my mind for so long. You’re a guy who had Formstack. It did so well. I mean after years of working hard at it, it became a contender, a huge contender against really big giants in the form space. It produced money, then you go and you start Formspring. Then I don’t see it on your LinkedIn profile but you started this network I think it’s called Loop right?
Ade: Yeah.
Andrew: It was like Twitter, but for every post there was a gif. I feel like you’re a guy who got the business tool right, the people were willing to pay for it, but the whole time you were pining away for like Twitter type success, for Tumblr type success, am I right? And so you moved to those worlds, and now you’re coming back with Jell to the business world where you can sell software?
Ade: Yes, you’re accurate. I’ve done quite a number of products and businesses on kind of the B2B side and some on B2C side. I would say I have always just been a builder and experimenter, and so if there’s any secret to what success I’ve had, it’s that for everything that you might see on my LinkedIn profile that anybody’s touched there’s probably five other things that I’ve built that maybe nobody’s ever seen except for a close or old friends.
And from kind of early on in my career is just I get an idea, I experiment with it, maybe build an MVP and kind of tinker around with it. And then see where it goes, and then kind of double down on the things that are successful and then continue to iterate there, so . . .
Andrew: I see so it’s not that you’re hiding it from your LinkedIn profile, it was just one of many experiments I just happen to have noticed that one, but there were others.
Ade: Right, yeah.
Andrew: Okay, all right and I should say Formspring was incredibly successful. We’re going to talk about that. The first thing that I do see on your LinkedIn profile is something called Bottled Software. This is a company that you started?
Ade: Yeah, there’s a company I started in college, so as a senior in college. And kind of the background behind that is I got into web development as a freshman in college, and did freelance work all throughout college kind of pay my way through college, and get spending money.
And basically, as a senior this I . . . this dates me a little bit, but I’d say one of my biggest influences was the movie “Office Space,” where basically I just kind of looked at that reality after college, and I said you know what, I’m having a lot of fun and I’m able to support myself doing web development on my own, and I don’t want to go work for some large company . . .
Andrew: So “Office Space” was the thing you were trying to avoid for your life that kind of . . . Got it.
Ade: It was the thing I was trying to . . . so I think that came out my junior year and me and my buddies we watched it, I don’t know, probably a dozen times. And basically just started having conversations with a few of my friends in school and said, you know what, what if I just kind of take this freelance business and we kind of team up and then see if we can keep doing that full time. And that’s kind of what we did [inaudible 00:06:57] . . .
Andrew: And it did well, but you said look consulting is great. I want to have software. You created content management software. What specifically was it?
Ade: Yeah, so Bottled Software really started out . . . did a lot of custom development for clients and any programming. But one of our first clients was actually my alma mater Anderson University, and basically, the problem that they had is, had this sprawling website with content for everywhere from alum to admissions to sports and really no good way to manage that.
So at the time . . . this was back in 2000, at the time, this was obviously pre-WordPress, pre all the content management systems we use today. And all that was really out in the market was big enterprise solutions that you’d pay six, seven figures for, and a lot of consulting fees. And so really saw an opportunity to build kind of a lightweight content management system for them, we called it WebTwist.
And so they were one of our first clients, and we built WebTwist for them, and then kind of the light bulb went off, and really at my heart and everybody I was working with, we really wanted to find that one product to work on. We didn’t really want to do consulting work full time. And so ended up kind of productizing WebTwists and going out and reselling that.
And so did that for a couple years, but ultimately we shut it down, just because first of all, really naive and made a lot of mistakes. It was a group of us that had never really started a business before, never really understood startup world. We probably would have failed regardless, but it was also the wrong time to start a company.
So I graduated in May of 2000, and we started the company in January of 2000, this is obviously right as kind of the dotcom bubble was bursting. And basically towards the end of Bottled Software’s life, just had so many conversations with clients who just didn’t feel like the internet was really a thing that they needed invest in.
And so our sales cycle just got longer and longer, and me and my co-founder kind of looked at each other and said you know what, we could probably make more money if we just went worked at Starbucks or something like that, so let’s what’s take a break go get a real . . .
Andrew: I looked at the about page on your site, you apparently racked up a lot of credit card debt?
Ade: For Bottled Software?
Andrew: Yeah, you say build a CMS called WebTwist, but couldn’t sell enough licenses, racked up credit card debt learned a lot about entrepreneurship, and got married.
Ade: Yeah, I don’t remember how much the debt . . . I mean it wasn’t astronomical it was probably . . . I think I maxed out a credit card but as somebody who’s just a recent college grad who I don’t think ever had a W-2 at the time, I probably only had a couple thousand in credit limit. But for me at the time it was definitely significant.
Andrew: All right so you spent four years at a job, how closely did the real-life job experience match what you saw in the movies and were scared of?
Ade: It was a little bit of both, there was some aspect of it that was pretty similar, but I learned a lot more than I thought I would. And I’m still really happy for that experience just because I walked in to . . . so I worked at Gannett Newspaper Media Company, large organization, tons of training and processes and systems.
And I just really hadn’t had even that exposure to the positive side I guess of all that process right. So walked in and after a couple weeks realized just all the things that I did wrong. Even just simple things like when we try to hire people at Bottled Software we asked all the wrong questions, you know the question that you’re not supposed to ask in an interview. And didn’t even really think about the right way to hire, the right way to kind of systemize work, and so really learned a lot about at Gannett, but yeah at the end of the day . . .
Andrew: Is there something that you can share with us that you took from working there about systemizing work or doing it better than you did when you were running your own company? Let us learn from your experience what’s one thing that stuck with you?
Ade: That’s a really good question I was exposed a lot more to just kind of the process of things like Scrum that we really didn’t follow at all in that first company. Things like just understanding performance management a little bit better. Now probably my thinking has evolved since then, but it was the first time that I had to participate in and implement a formal review process for employees.
And so even just thinking through that framework and trying to . . . also seeing . . . not just seeing . . . again it’s partly seeing what’s right about it, why you want to do that. But also experiencing that they vividly to know what’s wrong with it also kind of helped shape my thinking . . .
Andrew: What was wrong with it?
Ade: Probably the worst part about it is we did annual reviews, and probably anybody that’s gone through any of our reviews understands this. There are at least a couple things wrong. One is because everyone is kind of scrambling at the end of the year, the period to write the review whether it’s just self-evaluation or the management review it’s very . . . had a lot of recency bias, and so we didn’t . . . I tried to get better at this as I was there but have kind of continuous feedback and have those conversations throughout the year. But for the most within the organization I just felt like most of the things that were discussed, were things that you just accomplished in the last month or two, that your manager would remember, and then . . .
Andrew: So what’s a good thing that you learned from them? You’re right by the way, that that happens to me all the time. That when I try to give people feedback at the end of the year, it’s always the things that happened the last couple of months, because frankly what happened 10 months ago is not relevant.
Ade: Right, yeah exactly.
Andrew: So then what’s one thing that you learned about how to do that, that I could take back to my team, about how to give feedback better?
Ade: I had a lot of great training as . . . so I started there just as a developer, after about a year or so I got promoted to management, and so manage a team. And got a lot of great management training around just really . . . there are a couple principles that stood by me, probably the most important one that I took from there specifically was, had some training around just thinking as a manager it’s my job to really understand everybody individually. And really understand kind of where they want to head, what direction they want to go personally, professionally, what their goals and objectives are. And then figure out how to align the organization or team objectives in the same way.
And basically there’s harmony when those arrows are all lining up the same way. And it was a way of thinking about management, a framework about thinking . . . that I just . . . I don’t know. I hadn’t thought about that before and really understanding how to figure out people strengths and kind of double down on those strengths, to get those arrows to align rather than focusing on people’s weaknesses.
My perception from office space from those crappy high school jobs was that management is all about really figuring out what people are doing wrong, and identifying those and calling those out, versus really trying to understand what’s your core strengths and what’s your motivation, where do you want to head, and how can I hope you get there in a way that aligns with the organization. So it’s really that thought process.
Andrew: Yeah, that’s the . . . what’s the name of the author of the book? This is the “Strengths Finder” approach, right?
Ade: Yeah.
Andrew: Is it Tom Rath? No, its First “Discover Your Strength” hang on it’s coming up right now. Man, why does Google make it so hard to find books. Let’s just go straight to Amazon Marcus that’s what it is Marcus Buckingham.
Ade: Yeah, exactly.
Andrew: Great book. I think even Facebook ended up hiring him to come in and teach their people.
Ade: Really? I didn’t know that.
Andrew: Yeah, I am pretty sure he might even still be there right now as, not a full-time employee but as a consultant who trains their people. It’s also a well-written book too.
Ade: Yeah, that’s one of my favorite management books, yeah.
Andrew: Okay and then your wife got pregnant and you do what?
Ade: So really the last kind of . . . my last year there I was still learning a lot but I really started to . . . the longer I was there the more I kind of itched to jump back into entrepreneurship, and knew that I wanted to build my own thing.
Not necessarily rational necessarily in terms of career and all that stuff, it was just . . . I just knew I wasn’t going to be happy until I did that. And so I really have this long internal struggle about what’s the right time, what’s the right idea, and kind of bounce back and forth between a lot of different answers to those questions.
And really talked with my wife about it quite a bit and she just really kind of gave me permission to say you’re not going to be happy unless you do this. So we wanted to have children and so she was pregnant with our first son, and basically, I picked the wrong time to quit, which is essentially two weeks before he was born, so . . .
Andrew: Did you talk about it with her?
Ade: Yeah, for sure, we talked about it a lot . . .
Andrew: You know what, sorry to interrupt. In the early interviews that I did I would have just brushed right past it. Now that I’ve got two young kids, I remember what it’s like before they’re born. Yes, there’s all this excitement but I also would have this worry not about how I’m I going to take care of them or myself in the next six months. It’s I got 16 years and 18 and 20, and it’s just going to go on. And then you see people who when they need to come back home in their 30s because of whatever issue, I’m going to need to be there for them. Did any of that go through your head?
Ade: Yeah, it did but really . . . so this may be what you’re saying, but I think what really kind of drove me was thinking about . . . so having a child at least for me and I’ve heard this from a lot of other parents is, when you have your first child, you start thinking much longer term, and you start thinking more about . . . maybe more about legacy than about what are my career goals in the next year to five years.
And what really kind of . . . my wife and I talked about it a lot, and what I realized is I’m not going to be a great father if I come home drained and all about work. And is this really is the life that I want, where I’m going to be that person 20 years from now regretting that I stayed in a job or a situation that I . . .
Andrew: You be like the dad in “The Wonder Years” who this kid only remembers him as grumpy.
Ade: Exactly, and so it’s funny I didn’t realize at the time, but the more people I’ve talked to I found more and more people who kind of made big life decisions right before . . . and kind of the weeks and months before their first child, and I think it’s because of that. So basically knew, all right, I need to do this and . . .
Andrew: So what were you going to do? What was it work that you were going to do?
Ade: Yeah, so basically . . . so I quit two weeks before he was born and I kind of did that because I kind of calculated that at least we’d have health insurance coverage through another month, so that was kind of like the latest . . . or kind of earliest that I could quit and still have health insurance.
And I also kind of got to that point where probably about a year prior I’d had some ideas and kind of tinker nights and weekend, but my job at the time was pretty demanding, so I wasn’t able to give it my full attention. So I just kind of came at that point where I’m just going to quit, and then after I quit I’m going to figure out what I’m going to do.
Andrew: I see, and partially it’s because of something that Matt Mullenweg said to me. I said weren’t you afraid to get into WordPress? And he said, “No, I’m a developer I could always find work.” My sense is you are a developer, now you had experience working for yourself, lots of clients, building your own CMS, content management software . . . . content management system I think is what a CMS is. And so you had lots of experience, and you said I will find some work and I’ll also start to create products, and one of them will take off.
Ade: Yeah, exactly. I had a lot of worry, but yeah, you’re right I felt like there was enough of a . . . it was a blurry path but there was a path back to figuring out how I could feed myself and my young family. I felt like I needed to kind of completely sever that cord to really give myself the freedom and flexibility figure out what I was going to work on. So I had a handful of ideas, Formstack was the first thing I worked on . . .
Andrew: You know what, let me take a moment to talk about my sponsor and then I’ll ask you where you came up with the idea for Formstack because it’s something that I’ve heard in lots of other interviews about where great ideas come from.
First the company that’s sponsoring this interview is called Bench. Bench is software and a team of people who do your books, you know they keep track of where your revenues are coming from, where your expenses are, etc. Who did in the early days your books?
Ade: So I downloaded QuickBooks the very early days did myself and then ended up finding a book keeper kind of locally to . . .
Andrew: An individual bookkeeper?
Ade: Yeah.
Andrew: So you know what I did QuickBooks for a long time too, and it was such a nightmare, because like you said you have to download it. Now they even have a web version. It’s just a pain in the butt.
So what Bench wants to do is modernize the software, but also say look you as a business owner shouldn’t have to do this, and you as a business owner shouldn’t have to go out and get a bookkeeper to do it. Because first of all, you’re going to have to do a lot of interviewing, you should interview for people who change the course of your business, not someone who’s going to keep track of where the money’s coming from, and you should have a team of people.
And here’s why a team is important, just a couple of months ago I decided you know what my business books are taken care of, why don’t I have my personal books taken care of? Where’s all this money coming . . . I mean going. My wife and I make a good living, I don’t take every dollar out of Mixergy and bring it home. I take a good amount. She makes a good salary. Where’s all this money going?
So I decided I’m going to hire someone from Upwork, and I said I need you . . . you pick the software, answer these questions so that I can figure out who the right person is. And I need you to do my books on a monthly basis and get on a call with me. So I found a bunch of people. I picked Peggy because she was the best of the lot.
And Peggy’s good but here’s the thing, I’m supposed to talk to her on Thursday, and she pings me using the Upwork messaging system to say, “Andrew, I’m doing a lot of W-2s right now or 1099s I guess, do you mind if we do it a week later?”
No, my calendar said . . . I can’t do it a week later. And then another issue over the holidays she couldn’t do it. I totally understand it. By the way, W-2s are more important than figuring out where my wife is spending money on clothes or food or whatever it is right, I get it. Before the holiday, same thing comes up. People have lives, people have issues, I totally, totally get it. I don’t want that for my business, I don’t want a single person to be the point of failure when it comes to my books.
That’s why I like working with an organization that has a team of bookkeepers, first of all, the software does the work, which QuickBooks is not really there for. Software sucks in the data from Stripe, sucks in the data from everywhere else, your credit card, your bank information, put’s it all in, organize it as best as possible. And then a real human being goes in and makes some adjustments says hey you know what, usually most people want this software categorized this way, Andrew would want to categorize that way bom, bom, that’s what Bench does.
If you guys are interested in having your books done right, and really what you want is to know the score in your business on a month to month basis. I don’t play video games but you know what, if I go out and I play a video game and they show me points, I want to try to beat my points. I’m now bike riding in the backyard because I’ve got kids. I don’t have time to go out for long runs anymore. It sucks.
But at night I can get on this bike, and I’m using this app that tells me how many miles I’ve ridden, how high I would have ridden like in this virtual world, but I want to beat that. Last night I was exhausted. I still wanted to beat it. If you get points, you naturally want to beat it. And that’s the thing about having good books. If you see your points on a regular basis, meaning your profit and loss, your expenses and income, you’re going to want to keep beating it month after month after month.
And that’s what Bench will do, it’ll get it done right for you. If you’re listening to the sound of my voice, they’re going to give you 20% off your first six months with Bench, and because some people in my audience were kind of pains in the ass about it and they found that they were offering at Bench a better deal than they offer me with my special URL, Sachit went back to Bench and said come on give us something better or else the Mixergy audience is going to complain to Andrew. Here’s what they said, they’re now going to give us a free trial.
That means look at this these guys are going to do work for you to get your books organized for free just so you can see how great it is to have your books done right. Go to bench.co/mixergy, bench.co/mixergy and you’re going to get that plus so much more. And don’t forget to look down at that quote on the very bottom from Jason Fried. If you know him, you know how valuable that quote is on their website, bench.co/mixergy.
All right, you were doing consulting work and something kept happening over and over. What was that?
Ade: Yeah, so again engineer by trade, so was trying to find large programming projects, and had some great projects, but then somewhere in there, my client inevitably would say hey, can you build me a contact form for my website, this contact form to grab some leads. And that just kept happening over and over. As a programmer, that’s kind of boring work. It’s not really fun engineering work, to create a form that capture some data and send it via email.
Andrew: And this was on static websites or WordPress sites?
Ade: Static websites, so this is even still back, I forget exactly when WordPress launched. I think 2008 maybe 2007, something like that. It may have been right as WordPress was launching or before that. But yeah. So it either be a static site or kind of embedded within some other CMS.
Andrew: I see and they said to you, hey, you know what we need . . . actually the initial release of WordPress was 2013. I’m looking at Wikipedia, but Matt Mullenweg took over from something else I think a little bit after that. No, actually WordPress released 2003 excuse me, 2003 Matt Mullenweg, Mike Little.
Ade: True.
Andrew: But it wasn’t prevalent back then, so you’re building static websites and people kept asking you for forms. There were these forms. There were scripts online. Couldn’t you just go get one of those scripts and put it on their site and call it a day?
Ade: Yeah. So probably most programmers around that time would use something from what was called Matt’s Script Archives. So basically CGI scripts that you could download and plop on your site. They were riddled with security bugs and you’d have to customize it some way. So I might be able to find a fairly robust CGI script that I could download and plop on somebody’s site, but inevitably they’d say something like, “well I wanted to . . . if they put in this information and send it to this email address versus this email address, or “I don’t want to just get an email. Can you put it in a database so I can dump into a spreadsheet?” or something like that.
Andrew: What were people trying to do with their forms? I remember contact forms were the natural easy request. What else were they trying to do with forms back then? What were they asking you to build?
Ade: Contact forms are probably the most prevalent thing. It was also a lot of internal stuff too. So basically I want to . . . I’m trying to think of a great example, but I may have a . . . say I’m a nonprofit and I have a list of donors, and I want to send out a form to all of them to collect some information, from a list versus embedding that form on my website, so all sorts of different used cases.
Andrew: So you just kept doing it over and over again. By the way, Matt’s Script Archive is still up and running right now. It’s not being used at all it. Doesn’t seem like anyone has touched it since maybe 2009. Yeah, the what’s new section has a post from July 14, 2009, but it’s an interesting relic of what people used to do with these scripts.
Ade: Yeah, Matt’s Script Archive I think dated back to . . . I mean I remember using it in college back to [inaudible 00:28:17].
Andrew: 1995, it says it right there at the very top, offering free CGI scripts to the web community since 1995 exclamation point.
Ade: Yeah, Matt was awesome and I haven’t . . . I should probably look to see what he’s doing right now. But if I remember correctly, it was just some . . . I think he was a high school student when he first launched that, and just had a bunch of scripts that you could stack counters and stuff like that.
Andrew: Couldn’t you just go and say look guys I know you want a new form on your site. There’s Survey Monkey. Let’s just link out the Survey Monkey survey and be done with it.
Ade: So Survey Monkey was the thing out there essentially the SaaS tool before we all called it SaaS that you would use if you wanted a survey. Survey Monkey back then was horribly ugly, it was slow, it was created before kind of Ajax-enabled applications, so you had a lot of clicks and steps to just create that form. And it really worked fine for a survey but it didn’t work at all for embedding on your website. It didn’t work at all for really like the ability to customize it or anything.
And so at the time . . . so this was in early 2006 that I started working on Formstack. At the time, Ajax technology was becoming more ubiquitous, so this was about a year or two after kind of Gmail really popularized this. And saw an opportunity not only to solve that problem that we talked about, where I could just give somebody a tool and they kind of create their own form that has all that functionality without me having to code up the HTML or anything like that. And could do that in a nice like drag and drop kind of slick way.
So the timing was also right too in that it brought . . . I was able to have just a much more user-friendly tool to do that. So yes, it wasn’t just the . . . and it wasn’t just the like processing part which is kind of that Matt’s Script Archive piece of it, but it’s also like having to code up all the HTML inputs and dropdowns and all that stuff that people needed as well.
Andrew: So the first version you created 2006, you said this is going to be my SaaS, this is . . . well I don’t know if you called it SaaS at the time.
Ade: I didn’t call it SaaS at the time I don’t think.
Andrew: It was called Formspring, right?
Ade: Right yeah, it was called Form.
Andrew: I see the original website right here on my screen thanks to the Internet Archive.
Ade: Okay, yeah.
Andrew: Under the features the last item there is you don’t have to install anything on your website or local computer. All you need is a web browser and an internet connection. That’s it.
Ade: You still had to explain that at the time [inaudible 00:31:08] install, yeah.
Andrew: So you built it, you put it up. You told our producer, you know what, I’m a developer. I’m not a designer. It didn’t look that great.
Ade: It didn’t. It was pretty ugly. So yeah, I did it all myself. I cringe when I look at those old screenshots, but if you compared to kind of other apps at the time, it wasn’t that bad. It was probably maybe a C minus in terms of design.
Andrew: No, I’m looking at it here, I’m looking for things to bring up to make you smile and kind of laugh at how like immature you were as an entrepreneur, but the stuff looks good. Looks okay. It looks very Windows-y.
Ade: Yeah, very table . . . a lot of tables, a lot of kind of stock icons and stuff like that.
Andrew: But I can add fields it was a certain number of fields that I could add into my form. I could send . . . actually here I’ve got a list here, you told our producer. Six different types of drag and drop fields into your form. There was no conditional logic meaning if somebody says I have a sales question, you can’t forward that email to the sales department tech. You can’t.
There were no integrations. Today if someone fills out a form, it can could go into their email software. And there was an HTML snippet that they could just put on their code, so they were basically embedding your form into their site. That’s the heart of it. This is what you were selling for free if somebody wanted . . . let me see, let me bring up the price structure. I like that you were selling at the time because this was at a point where people had an issue with charging online. Do you remember that?
Ade: Yeah, it was hard to just get people to take out the credit card and fill . . .
Andrew: And you were looked at as a jerk for charging for anything online because information wants to be free, tools want to be free, why not do advertising?So you did have a free version, the free version allowed for one form only 15 fields, 50 submissions per form, that was basically it. There wasn’t a lot of customization, and then it went from $5 up to $50 a month that was good pricing.
Ade: Yeah, it’s funny, I actually think probably one of my biggest mistakes with Formstack was probably pricing too low. That $5 plan I added that kind of last minute. I kind of second guessed myself. Got some feedback from a friend, “Maybe should have a really cheap option,” and I was kind of like yeah, I don’t know will people really buy this. And so added that $5 plan, and can’t make a lot of money on $5 a month plans, but that was $5 350 bucks . . .
Andrew: And that was a mistake you shouldn’t have the $5, you shouldn’t have listened to your friend just go for 12.50 as a starter right?
Ade: Exactly, the people who pay . . . basically there’s obviously a line where if you’re going to pay for a software and once you kind of cross that line, then you’re probably willing to pay more than 5 bucks a month if you need the software for your business.
Andrew: All right, so now it’s time to get some customers. I see how you built it. Let’s understand . . . do you remember where you got your first customers?
Ade: Yeah, I didn’t have a good process for it, so I told all my friends, told my clients, said hey I built this can you take a look. Got some great feedback. But really my first customer and regretfully I’ve lost who that was, but my first customer didn’t know them, they found me online. So I was posting kind of all over the place, in any directory I found, any sort of article related to form building. I was in the comments saying I just built this online form builder and posting on forums and stuff like that too.
And so I assume they found me somewhere there, but that’s kind of where I found most of my first customers. And then over time, within that first year, started to get some more customers via SEO, and started experimental with PPC, and so I got customers that way, as well as people from [inaudible 00:35:13].
Andrew: The early embed code, did it also embed a link back to your site?
Ade: I think it did. I can’t remember when I added that. I mean it was pretty early on. I don’t know if it was the very first version, but yeah that was a big strategy at some point, in terms of driving SEO.
Andrew: That’s something that I can’t find, if you heard a ding dong in the back as we were talking, I was trying to find right now as we were talking one of the early forms to see if I could add more color to the conversation. I couldn’t. I ended up finding a spring fertility website they had a form on it, and then they popped one up of those chat boxes. You do remember though . . . you told our producer first month you made 75 bucks. Second month, do you remember what second month was?
Ade: I think it was 73 bucks.
Andrew: Seventy three, so because of churn, you’re going backwards how did that feel?
Ade: I went backwards, so did you say how did that feel? So the first year was lots of ups and downs right. So think about the context of just had a kid, trying to figure out how I’m going to kind of survive and put food on the table. I launched Formstack then formed Formspring. Super excited when I got that first customer. It was the first time probably that I ever received a dollar of income or revenue without talking to somebody.
Even back when I was selling content management system, we have sales process, talk through with the potential customer or consulting, I usually talk to them. And this person found the site, put in their credit card. I didn’t know them, didn’t talk to them. That was awesome.
Obviously when I was working on it, I was like I had hopes and dreams of this thing taking off and making millions right away on my best days. And then on my worst days had the opposite thought that this thing is going to go to zero, and I put all this work into it and it’s not going to [inaudible 00:37:26].
Andrew: Not only that, but we talked about Survey Monkey and the issues with that, I still don’t like Survey Monkey because of the way that you link out. But I interviewed the founders of Woofu, they came out soon after you JotForm, FormAssembly I don’t know them. So basically competitors were starting to come in, and the investor didn’t fully understand them.
I’m looking at my transcript from my conversation with Kevin Hale the Co-founder of Woofu, they took $18,000 from Y Combinator. That’s what they gave at the time. They couldn’t raise money from any outside investors. So Paul Graham and Paul Buchheit kicked in 50,000 each, and I think that was the full extent of the money they could raise at the time.
But they had money, and you were bootstrapping and you got a kid. They were kids. They had time on their hands to go and compete against you. You started to feel deflated because of that, right?
Ade: Yeah. That was probably one of my lowest points in working on it. So the timeline as I remember is I quit my job, start working like crazy on the original idea, and I did a little bit of research to try to see is anybody doing what I’m doing and couldn’t find it anybody other than Survey Monkey. And so part of my dreams at the time I was like okay, I’m going to be the first, I’m going be the only one who has this idea. It’s going to explode like crazy.
So head’s down, coding like crazy, build it, launch it, and then two days later I see JotForms comes out. And I’m like holy crap, how did . . . you know clearly they were working on it the same time that I was working on it and completely deflated at the time. Now I have a different perspective around competition but at the time, I was like this sucks.
Andrew: What’s your perspective?
Ade: Now today I definitely see competition as being healthy, so there’s a balance, right? You don’t want to see too much competition in the market, but if there’s nobody in the market doing what you’re doing, then that’s probably a good sign that there really isn’t a market for it right. And competition in the market does . . .
Andrew: Or maybe people just didn’t discover it. Maybe they’re not smart enough to notice it.
Ade: Yeah, it could be but I mean if there’s an idea that I have and that nobody’s tried this, nobody has tried to tackle this, then that’s more often than not a bad sign. Now, what I like to think about now is if there’s competition in the market, how can I build something that’s 10x better, significantly better in terms of the value it gives the customers, or the way I can address the market with something new. But yeah, seeing some competition out there is probably healthy . . .
Andrew: But at the time you were starting to feel demoralized. Look at these guys, they had money, they had a reputation. The fact the Woofu guys could go into Hacker News and say we have a form and get attention, that was huge.
Ade: Yeah, Woofu launched probably within a few weeks after. So they announced their beta and it was completely different than what they ended up launching later that year, is like kind of this Flash app and all that stuff. But yet they got all this buzz and hype and all this press around it, at least kind of within the design and developer circles because [inaudible 00:40:46] . . .
Andrew: They were designers too. They had a design magazine so they were reaching their potential customers. They were all geeking out on designing . . . this was your weakness they had as a strength.
Ade: Yeah.
Andrew: All right it’s interesting though that despite that you still did well. First year do you remember what monthly revenues were? I have it here. I could read it.
Ade: Yeah, I want to say probably end of the year probably a couple grand few grand per month. What did I say earlier?
Andrew: A thousand bucks a month.
Ade: Yeah, okay.
Andrew: That’s not bad but it’s going to pay for more than diapers but not much more than diapers.
Ade: Yeah, so by the end of the year, I was paying for diapers primarily through consulting work, so I was spending probably full-time job working on consulting work for clients, and then a second full-time job working on kind of Formstack. And by the end of the year, just kind of . . . again it was lots of ups and downs right it wasn’t . . . and some of those ups and downs was going to happen within the same day somebody cancels and this sucks. Nobody’s ever going to buy this anymore, and then somebody signs up and I’m ecstatic. But really question . . . there is a point towards the end of that first year where I really questioned whether or not I should shut it down.
Andrew: And just focus on consulting maybe come up with a new way. So how do you . . . you know what, let me save this question. How do you decide whether to shut it down or not, because at the end of the first year, you weren’t making enough money? Maybe this was one of the experiments that wasn’t meant to be. I want to know how you decide whether to shut things down or not because you’ve made that decision a few times in your career? First, let me tell everyone about a company called ActiveCampaign, you guys integrate with ActiveCampaign don’t you?
Ade: Yeah, we do.
Andrew: Right so someone can fill out a form saying like I know what, maybe a contact form that I would have on my site. They fill out the form saying, hey, Andrew, I love this interview. I like how you are able to talk about the difficulty of entrepreneurship. And then maybe have a checkbox on the forms says also subscribe to my newsletter. Anyone who checks that box can automatically go to ActiveCampaign and be subscribed to my newsletter. And it’s your form taking that data, making the decision about whether to send it to ActiveCampaign or not, right?
Ade: Correct, yeah.
Andrew: Now that’s frankly the way to be, in fact, what we could do even is have a dropdown menu that has people also if they check a box that says I want to subscribe to a newsletter too, maybe we ask them what are you interested in. So we’re not sending them the latest newsletter, because frankly, newsletters are pretty dopey nobody wants to sign up to newsletter. But it might be something like can I send you 10 interviews that I think would be helpful but how do I know it’s helpful? Maybe the drop down menu after they’ve checked the box that says yes, send me those 10 interviews.
The dropdown menu follows up and says, what are you interested in? You want to know about companies that were started bootstrap, do you want to know about companies that were in the SaaS space. Whatever it is they pick from the dropdown menu. And then ActiveCampaign gets that data and they allow us to customize what we send to people. That is a little too basic, but that’s essentially what ActiveCampaign will do.
If you want to get much smarter than that, what ActiveCampaign will do even further than that is watch what people are doing within those emails. What are they clicking on, where are they going to, what are they spending time on the website. So someone could say I really want to know about funded companies, but they’re really watching a lot of videos about bootstrap companies. So maybe what we want is our emails to start customizing and telling about bootstrap companies.
Maybe what we want to do is after they’ve watched the fifth video, come in with a sales sequence of messages where we sell to people only after they’ve been fully engaged, and say you know what you liked these five videos and our software knows, and we might want to take it to the next level where you get access to all thousand videos.
This is very, very basic marketing automation, if you’re listening to the sound of my voice, you should see how basic marketing automation can improve your business and make it smarter, and more relevant to your readers. But more than that how it could . . . if you get a little smarter about it, how it can increase your revenue.
All right, usually marketing automation is a pain in the ass to put together, it’s hard to install, it’s hard to implement, it’s hard to manage. Either the CEO winds up doing it himself because he can’t find someone else or he ends up hiring someone for tens of thousands of dollars a year. It’s not unusual to go over one hundred because the software is so tough. ActiveCampaign decided they were going to be easy to use so that you can get all the power of automating the marketing, and the emails, and the communication that you do with your customers.
So if you want to try to out and see for yourself how easy it is, they are also giving you a free trial. All you have to do is go to activecampaign.com/mixergy. You’ll get that free trial. Get a drink in your hand if you’re a wine drinker, if you’re . . . I don’t smoke so I can’t say it, but I imagine if someone was smoking weed, they might want to just sit down and smoke. This is not good. This is not what the sponsor’s looking for.
Here’s I’m saying, relax with this. You don’t have to sit down and make a “I’m going to change my whole business decision with it.” Sit down, watch a Netflix video, try ActiveCampaign and you’re going to see even with half your attention watching “BoJack Horseman” on Netflix, and the other half on the software, you’re instantly going to have your mind blown. Going this is so easy, I actually can talk to my customers like they’re human beings, and I can be responsive to what they’ve done on my site.
So go to activecampaign.com/mixergy, you’ll get a free trial, you’ll get your second month free. You going to get two free one on one strategy sessions with their consultants will show you how to use this in your business to really change the way that you do business. And finally, if you’re with another email provider and you’ve had this time watching “BoJack Horseman” on Netflix or something else and you’ve decided this is for you, but you don’t have the patience or the time to migrate from those other cheaper not so good email service providers, they’ll migrate you for free. All you have to do is go to activecampaign.com/mixergy.
You know I do these ads on the fly. I did an ad for you, I’ll be honest with you. So you guys were sponsors of mine, I screwed it up because I’m doing it on the fly.
Ade: I heard about that I didn’t listen to it but I . . .
Andrew: You did, what did you hear about it? What made its way back to the founder?
Ade: I heard that there were some mix up Formstack and Formspring and kind of heard something about Formspring shutting down . . .
Andrew: Am obsessed with you dude, yes, so in the ad, I said there was this Formspring thing . . . I couldn’t like not tell people about this whole Formspring story that I’m hoping we’ll get to here. And then apparently and this I didn’t realize, when I closed it out I think I might have called you guys Formspring instead of Formstack.
Living Dangerously I warned you before we start we don’t do any editing, this is partially what people love. I’m listening to the oral history of “The Daily Show,” any fan of “The Daily Show” is going to love this. And part of what Jon Stewart decided to bring to the show was no editing. Now they do a lot of prep to know, but the fact that there’s no editing adds a sense of danger to the show, adds a sense of if things don’t work out be human about it instead of being overly polished.
And I find especially with podcasting, we’re getting to this point of excessive editing because NPR is doing so well. And we’re getting to a place where it’s almost like ads after they discovered Photoshop where at first they did a little bit of editing, let’s get rid of this blemish, then a little bit more, and before long, models had no knees and they all had big boobs and elbows disappeared, and it was like this fake thing that’s just not at all connected to reality, and I don’t want that to happen to my podcast.
Ade: I like the way you think about that.
Andrew: All right at the same time I’m sorry.
Ade: That’s all right.
Andrew: All right, how did you go from $1000 a month in revenue? What did you do to bring in more customers and bring in sales?
Ade: So part of it was really just kind of making the decision to stick with it, right? So SaaS can be a hard business right. You invest a lot up front, and one of the big decisions I had make is I can spend an hour of time and charge a client say 100 bucks an hour, and know that I’m going to . . . as long as they pay their bills I’m going to get the 100 bucks. Versus I can spend an hour working on potential features or marketing side or something like that with a SaaS business, and I won’t know for . . . assuming my . . . even if my CAPE ratio is all that right it may take a few months before I get the $100 back that I’ve invested into it.
And so kind of at the end of the day, I . . . yes kind of before the break how do I think about shutting things down or not. It’s part science. The science of it is really looking at the numbers and trying to see if the model works, and as people retain with the business, as acquisition mechanisms are working like is that going to grow over time, what does that look like over time. There’s also kind of the art of the like do I believe in the vision of this, and am I excited about it.
And so with Formstack especially one of the things that really compelled me and still a big part of kind of our mission today is really putting the power that you get from programming into the hands of non-technical people. So it’s really cool to be able to say . . . one of the things I love today is when I run into people who are like I run my whole business on Formstack, we do this and this and this and this. And they don’t have to hire a programmer.
And I kind of felt after doing consulting for so many years, I just really didn’t love that model. I felt like there are so many things that we all could do on our own without really having to hire a programmer, and being able to provide that. So anyway, just that vision kind of kept me going through, kept me with it.
Andrew: The vision and you’re willing to sacrifice revenue from your consulting business to just invest more in the future of the software business.
Ade: Yeah, and part of that comes down to . . . and this is something that I talked to other people about and continues to be part of my own journey is really understanding well what I want as an entrepreneur, as a founder, as a person. Like what excites me waking up in the morning what do I want to work on.
And ultimately, I knew that I really wanted to build a successful product business. Building a successful consulting business really didn’t excite me that much, what excited me was working with some of the particular clients I worked with, some of the products we were working on. Like most of my . . . especially towards the end of my consulting career, most of my clients, almost all my clients were early stage startups.
And that’s what fired me up because I was with them trying to figure out okay how do we get to product market fit, what does the product look like and stuff like that. Again, ultimately I knew I wanted to build a product business not a consulting business. So that’s kind of what . . .
Andrew: I see a change in 2017, I’ve gone through your websites iteration over the years. Twenty . . . excuse me I keep saying 17, 2006 excuse me it was a developer who was thinking about the features and writing almost like a Google doc to explain what the features were within . . . you were smart about having a demo.
2007, a year later everything seems to change. You had buttons that looked very Web 2.0 on your site with the whole reflection on them. You had fields that were so smart that “Mashable” started writing about you, your whole design . . . you had a blog the whole thing was very embracing of the Web 2.0 movement that was starting to take on. Is that you or was that someone else who added that.
Ade: A lot of that was me. But by 2007 I hired two others. In 2007 I hired another engineer in kind of spring of 2007. And then hired . . . my second hire was somebody to do marketing full time making.
Andrew: And you were making enough money that you could bring these two people on?
Ade: Probably if I went back and looked at my books, I would have advised myself not to. It was pretty like razor thin, but yeah I felt like . . . yeah, it was enough to pay them. I had months where I didn’t draw a paycheck, and my wife and I have figured out how to make that work. But there was enough growth in the business at that time that I felt like we could take kind of periods of not drawing a paycheck to continue to invest in this and fund this. So we drained all our savings, probably we did incur debt, went probably the longest period, I think I went like six months without a paycheck or something like that.
Andrew: Six months.
Ade: Yeah.
Andrew: And you and your wife what, did credit card debt again?
Ade: Yeah and savings right. So I’d build up some savings in that . . .
Andrew: In a job.
Ade: Yeah, and the other thing . . . this other funny part of the story. So for a while . . . while I was working that other job, this is before I started Formstack, I got really sucked into online poker boom. And so played a bunch of online poker and probably built up another let’s say 20, 30 grand in savings . . .
Andrew: Really from poker?
Ade: Yeah from poker. So that was enough to say look there’s enough in the bank where we can stretch that over enough time if I can’t make this work.
Andrew: Here’s another thing you did 2007, you charged more, pricing just shot up, and you were smarter about how you displayed your pricing.
Ade: Yeah I [inaudible 00:54:18] that $5 plan didn’t I?
Andrew: Gone minimum was $9 a month and I think I saw that climb, but more than that you are doing this thing that some of the smart SaaS companies were starting to do. Which is identifying for people which price they should go for, not the cheapest one, but the most popular is the professional which is $19 a month.
You were starting to do that, you also started integrations, I see the PayPal integration start to come in, which means the people could use your form to collect money, which means you’re a more valuable part of their business, and now revenue starting to go up. I see where the business is going. Let’s move on to Formspring. How did you come up with that idea, and how did you get it to explode in growth?
Ade: Yeah, so Formspring is an interesting story, so fast forward to summer of 2009, so by this point, we’re probably about eight or 10 people in the business. I’d raised a small angel round for what’s now Formstack then called Formspring. This gets really confusing so real quick about the name.
Andrew: Yeah, please.
Ade: So the original company which is essentially the product of the SaaS business . . . the B2B SaaS business for online forms is now called Formstack. It was originally called Formspring. I go and launch this side project that’s the social network, and in my stupidity, I guess, called that Formspring.me thinking that that was going to be essentially for publicity and marketing, maybe some lead gen into the formspring.com B2B SaaS business [inaudible 00:55:58] . . .
Andrew: So Formspring.com was going to be the form site, Formspring.me was going to be the ask me anything social networking site. And you thought great, it’s different and maybe some people will type in .com by accident and then they’ll go over to my form business, and I’ll make some revenue from there. And the world didn’t see that as different enough.
Ade: Yeah, at the time, I really thought . . . in my wildest dreams and even . . . I’ll talk a little bit more about the story, but we kind of took bets internally about how many people were going to sign up for the first month. And I forget exactly I’ve got a picture somewhere of our whiteboard. But let’s say I said like 10,000 people or something like that and everyone was like you’re crazy. So at the time, our thought process, my thought process was this may get some publicity and visibility but it wasn’t going to be a thing. It was going to be . . .
Andrew: I see
Ade: Side project that maybe things got slow on a Friday afternoon we had hacked [SP] on it. But the B2B SaaS profitable money generating business was the core business, and so that’s kind of why we had to [name 00:57:01] this. But anyway the social network took off so that there’s just so much confusion between the two names, that we renamed the original business Formstack, so . . .
Andrew: Was that tough to go to your customers and say hey, everything is working great, you know what, I changed my mind. We’re going to call this thing Formstack?
Ade: Yeah, it was hard, took a hit on SEO, took a hit on . . . it was a lot of work to change a name and all that stuff, but it was all . . . Formspring was growing, the social network was growing so quickly that we had to do something because it created a bunch of confusion in the marketplace, you know people were calling in to support asking questions about the social network. And it was staff that’s answering questions about the B2B forms company, so anyway . . .
Andrew: So 2009 you launched Formspring.me.
Ade: Yeah.
Andrew: Becomes a social network. I’ve got an early sentence from it. It’s Formspring is a global social network where members ask each other questions and learn more about each other through interesting funny and personal responses. I know we’re going to . . . I would love to spend an hour with you on this frankly. I’m so fascinated by this. It really took over “TechCrunch,” “Mashable,” the “Techworld” why do you think this thing . . . do remember how many users you had at your height?
Ade: Yes, we had . . . probably at peak we had 50 million monthly unique visitors on the site.
Andrew: How
Ade: Five zero
Andrew: Five zero, that’s even a bigger number than I have here.50 monthly, how did you get it that high, what did you do to it?
Ade: So let me answer that as well. I never really answered your previous question which is why did I create it, how did it come to being, because those are pretty tightly related. So quickly summer of 2009, so a handful of people used Formstack the free version of the forms company as a way to get feedback on their blog. And so kind of the simplest use case was somebody would write a blog post and at the end, they’d say what do you want me to write about next, ask me question, or tell me something, dump it in this contact form.
And then they would get that email submission, copy and paste whatever somebody wrote, and then respond to it, it was essentially a writing prompt. At the time, I was trying to blog a lot more at the time, and I just kind of fell in love with that idea. I was like I feel like I enjoy writing, I enjoy sharing my opinion and thoughts, but I probably like most people were not wired to just stand on the stage and blurt out something. We’re wired to have conversations back and forth. You ask me how I’m doing, you ask me an interview question and I respond to that and I can talk about myself [inaudible 00:59:54].
And so I started kind of tinkering around this idea, again I had this profitable companies, the full-time jobs so focus on that. But then kind of . . . I was on a trip, I went to a conference and then started to kind of like . . . as people were speaking started sketching out ideas of like how could this work. I started sketching around wire frames for can I create a service that basically is all around this concept.
At the time Twitter was really kind of coming into the public consciousness and growing but Twitter had at that, at the time everyone was saying “Why would I use Twitter? Who cares what I have for breakfast? Like what I say on Twitter. And so that really connected with me too, to say well, if I get people to ask each other questions about themselves, they will be much more willing to create content and that could be a really engaging thing.
And so launched this as a . . . and at the time too I was really kind of into trying to understand a lot about like viral mechanics and kind of how do you measure that, how you think through that, what’s psychology behind it. And so really kind of use that as a little bit of a testing ground. I was like okay how can we create low friction for people to ask each other questions, and low friction for people to create content, and then what is that viral loop look like.
Andrew: What did you do to make it go viral?
Ade: Really try to understand the psychology of it, is just that, so really wasn’t much in terms of mechanics. I mean when we launched did have the ability to share to Twitter and share to Facebook, but it was really about understanding okay why would people share it. We usually don’t share with others to just say like check out this cool website or something that. We share because that sharing is baked into that utility. And so really the core viral loop within Formspring was that I have a fun experience talking about myself, and I want my friends or my network to ask me questions.
So we made it really easy for you to share out to Twitter or Facebook or otherwise, that ask me anything prompt, and so that was really the core hook. I would tweet out ask me anything, my network would visit my profile page see all the questions I answered and like okay this is interesting. I’ve always wanted to ask [inaudible 01:02:10] so you ask a bunch of questions.
And then you think well I wonder what other people are going to ask me if I create one of these things. So they create a Formspring account, tweet that out as well, and that’s essentially the core of the viral loop.
Andrew: And after they ask the question you prompt them to create their own Formspring.me page?
Ade: Right exactly.
Andrew: And it would be something like Formspring.me/andrewwarner, and now I can spread that on all social networks, I can embed it on my blog. Why did it . . . considering how fast it took off and you started raising money, I think Travis Kalanick . . . how do you pronounce his last name?
Ade: Kalanick
Andrew: Kalanick excuse me Travis, he was one of the investors, right?
Ade: Yeah, I had an awesome group of early investors, so Steve Anderson led that round. Steve was one of the first investors in Instagram and Twitter and . . .
Andrew: Was he red point or?
Ade: No, Steve has his own firm, Baseline Capital and he kind of helps [inaudible 01:03:07] out with Travis, Chris Sacca, David Moore and then Kevin Rose and just a great [inaudible 01:03:15] . . .
Andrew: I see that Mike Jones from L.A.
Ade: Yeah, exactly he was Myspace CEO at the time exactly. Dick Costello was an investor as well.
Andrew: Wow, okay because this was going to be the next . . . it was the next hot thing.
Ade: Yeah, it was growing like crazy.
Andrew: And all this funding also went into Formstack, so basically they were getting no?
Ade: No, so all this funding was in . . .
Andrew: It became its own separate company.
Ade: Yeah, so long story short launched this thing, went from zero to a million users in less than 45 days, registered users. And after a couple weeks, I kind of just realized crap I’m going to bankrupt this company, this eight person, 10 person SaaS company just on hosting bills alone. And so kind of scrambled to find some way to split up those two companies and raise money. So basically created a complete separation between the two, and raised money for the social network
Andrew: And that’s when you brought Chris Byers to run Formstack, an old friend.
Ade: Yeah [inaudible 01:04:22].
Andrew: You went on to run . . . sorry.
Ade: Yeah. Chris and I started Bottled Software. We went to school together, so we had started a company together. He was kind of in between things, and I said, look here’s what’s going on can you just come in and help me find a CEO to run this. And luckily he decided to was the best CEO to run it and stayed on board, while I went to off to focus on Formspring.
Andrew: Okay, so why did it . . . I know you’ve written about this but I’ve got include this here in the interview. Why didn’t it work out?
Ade: Yeah, there are tons of reasons why. I don’t think it was just one thing, I’ll talk briefly about . . . so probably three core things. One is that viral loop that I talked about it was extremely viral, and that mechanic worked really well, but we really didn’t solve the engagement problem until probably pretty late in the company’s history.
So just briefly you get really excited and you get a bunch of questions on it, but then at some point, like if you create a Formspring account, I’d ask you a bunch of questions but at some point, I’m kind of like, all right, I’ve asked you all the questions I want to ask you. Now let’s talk about me, is probably the simplest way I can describe it.
And so you’d have people’s experience where they get a ton of questions from friends in their network, in the first 1 to 30 days and then that would just drop off pretty sharply, and then their engagement would drop off similarly. So we were growing fast but if you look back at kind of our . . . and at the time, didn’t really understand these metrics until kind of late in the company’s life. Like if you looked at kind of their long term engagement, it just fell off a cliff.
And at some point, there weren’t enough people to come in new to keep that top line number high. So we kind of had a bit of in that shark fin effect, where we grew really fast. I think up to 10 million users in about the first six months, and then it just kind of slowly declined over the remaining years.
So that was probably the biggest issue. We also I think just really didn’t nail . . . we didn’t shift to mobile early enough. So it was very text heavy platform and we started to decline. Really if you kind of look at the growth of Instagram and snapshot overlaid with decline of Formspring, a lot of our users went there. It’s a very mobile-centric . . . those are very mobile-centric experiences, visual experiences. And so we just lost it was kind of . . . Formspring was the hot thing for a while and then our audience kind of went to the next social network, stuck with it.
But the last thing is . . . and you can . . . I’ve written about this quite a bit and you can look a lot to. We grew so large so fast and had problems that a lot of other social networks have, which is abuse and stuff like that on the platform. And we got a bunch of negative press about that early on.
Andrew: Partially because of the anonymity.
Ade: Yeah, partially because the anonymity, I also think the core problem we had was it came out of nowhere, and so you probably have . . . for a lot of people the first time you heard about Formspring was you read some article about some incident that happened or something like that where . . . and a lot of those cases abuse or bad behavior was happening on Facebook at the same time.
But you’re kind of like okay I know Facebook is this place where I see pictures of my grandkids so that’s like what Facebook is about. For Formspring the core engagement use case really wasn’t that, but we had a hard time shaking that part of our brand and our reputation, and so I think that affected us long term as well.
Andrew: Okay let’s just spend a couple of minutes . . . I know we’re over but I’ve got to ask you about Jell. Where did the idea come from?
Ade: So the idea came from basically looking at the problems we faced in Formstack. So Formstack we’re about 125 employees, most of them are remote, so we have our headquarters in Indianapolis and probably about . . .
Andrew: Is Chris there? Because I think Chris is there, he published a blog about being a remote CEO for a while there didn’t he?
Ade: Yeah so for a while he was remote. He moved back to Indianapolis a few years ago for a number of reasons but yeah. So we have our biggest concentration of people in Indianapolis area, but even if you walk into the headquarters here a lot of days it may only be 5, 10 people in the office even people who live in Indie, may just work from home or work in a coffee shop or working space somewhere.
So we went through a period of rapid growth, remote team, and really . . . and frankly some of the things that we touched on in terms of what I learned about management over the years is, I just felt like there a lot of like best practices that you know as a manager like I need to do this, I need [inaudible 01:09:25]. I need to think to think about the forms this way.
All these learning’s that really aren’t rocket science right, but as we kind of go through the day to day firefighting and triage, it all falls by the wayside. And frankly, the core tools that we use as managers to kind of manage our process are meetings and emails. Like there’s tools and platforms for managing your sales process, your dev process, your marketing process. But felt like we needed some software to kind of instill these best practices for ourselves as a team. So that’s kind of the [inaudible 01:10:00] . . .
Andrew: It seems like the focus is on the daily meetings, right? If we do a weekly meeting, would this still work for us?
Ade: Yeah, it’d work really well. So they’re kind of two core components, one is helping facilitate any sort of stand-up or check-in. So anytime you’re trying as a manager to get information from your team on a regular basis, it helps to do that. So some people use it as a replacement for stand-ups or check-ins but lot of people use it to augment that.
So you may have used it as a way to kind of collect metrics or data from your team, and then you walk into the meeting, and the hope is that you can spend the time in the meeting really being more strategic and focused, rather than using meeting time going around the room and saying okay, so what happened, where are these metrics. You have all that at your fingertips already. And so you can be much more effective in meetings, so yeah.
Andrew: All right its jell.com, a great domain must have cost you a bundle to get that.
Ade: Ten grand.
Andrew: That’s it, four-letter domain, easy to spell even I could spell it J-E-L-L.
Ade: Yeah, correct 10 grand. I wrote a blog post about that as well but basically, that was a long process to try to figure out how can we get a memorable domain name relatively cheaply. It’s cheaper than most people think if you’re not tied to a name, there are a lot that can be done for even four figures.
Andrew: So good I even like Formstack. I love the name Formstack. I actually like it even better than Formspring. It’s hard to . . .
Ade: I do to yeah, at the time it was a tough choice but we used to have people call it springform all the time.
Andrew: Really?
Ade: Yeah, Formstack is a great name.
Andrew: You know what in the past I’ve been a little bit weak about saying hey this . . . I’ve always said if I interview someone who was a recent sponsor I mentioned it because I want to make sure that people understand that I’ve got some connection to the company. But I never give the URL in any confident way, often didn’t even do it. The URL that they would give in the ad. Do you mind if I give . . . what are you actually doing here? Is there even a reason for people to use my URL? Probably not at this point. What the hell.
Ade: I’m not aware of what [inaudible 01:12:09].
Andrew: You know what, I’m just going to say guys, I said he was a sponsor and the URL if you want to go sign up was formstack.com/mixergy. Frankly, even if you just go to their home page, I think you’re really going to be happy with having a form on your site. I’m not going to knock any competitors even though you can tell that I have strong opinions about it.
But I think a form, a proper form needs to be on your site, you can’t send people away from the experience. It’s just too weird. Now I understand that there’s like behind the scenes stuff that’s good for the company if you send somebody away to another site number one you don’t have to deal with integrating it into your site. But it’s a weird experience as it is, it’s tough enough to say to somebody can you tell me a little bit more about you, about your business fill out this form.
But if you’re sending me a part to some other place I don’t feel the connection to you anymore, I don’t feel . . . I feel like you’ve just shoved me off to somewhere else, keep me in the conversation. All right, so I really like Formstack but whether you use them or not really just consider, embed the form on your site, and use forms much more than I think most people recognize that they should, because it’s too hard for them.
And forms are more than . . . I can go on like this I wish I would have started a form company. Do you know that there are form companies that were started years before you that are basically static form sites that are still producing revenue? It’s a good business to be in, because it’s on someone’s site it’s embedded, they’re not taking it off.
Ade: Yeah, there very high [switching costs 01:13:29], yeah.
Andrew: And people always think about either surveys or contact so much more, really like you said you can make it into a programming experience. You ask someone a question then you have a follow-up question based on what they . . . all right anyway, formstack.com/mixergy. I really love the business I wish I was an investor in your business.
And my two sponsors are totally close. Let me try to do it from memory. First, the company that will do your books right, it’s called Bench, go check them out at bench.co/mixergy. And second is the company that will help you send out smart engaging email marketing because it knows what people have done, and what they’re interested in, and then it lets you follow up with them based on what they’ve done and what they’re interested in. It’s called activecampaign.com/mixergy. All right, thanks so much for doing this interview.
Ade: Thank you, really enjoyed it, [inaudible 01:14:15] . . .
Andrew: Me too, all right, thanks, bye.
