Hello! Who are you and what business did you start?
Hey! My name is Hugo Valente, and I’m the Product Owner+ for a startup called Statful since December of 2017. I add that “plus” playfully since anyone who has been on a small startup team knows, your responsibilities venture outside the title (managing daily operations, coordinating marketing, pre-sales, and sales among other tasks).
Statful is a customized monitoring platform to track any type of metric. It provides you with real-time data in a centralized point-of-view for business, application, and system metrics. It empowers you to instrument however and whatever you want. It is for Developers, Operations, and Business teams who want the flexibility and the power to instrument their systems in a simple way.
Without having made any real investments in marketing and sales (also not getting any external funding) we have managed to get six customers - from entirely different business areas - reaching an MRR of approximately $10,000.
What's your backstory and how did you come up with the idea?
In all I do, my goal is to raise brand awareness and connect those who don’t monitor metrics to our unique tool.
My professional background isn’t directly connected to the startup ecosystem. Before joining Statful, I worked at two companies that implement Oracle enterprise-level solutions for retailers. On this path, I started as a Junior Developer/Analyst and through the course of 10+ years I ended with the role of Solutions Architecture/Project Management on large scale projects. These experiences allowed me to acquire a mix of technical and soft skills that are key to my actual challenge.
I wasn’t around when the idea to build Statful came up, or even when it was Beta released back in August of 2016. Statful is a product born in Mindera’s ecosystem (a tech services company based in Porto, Portugal), who had both the objective of adventuring into the creation of their products and the need for a monitoring tool that would provide visibility to development teams. Essentially, something that could communicate to both developers and the businesses what was happening under-the-hood of the applications or components they were developing.
There was some hesitation to build this solution ourselves: Why creating a tool where there are already some available tools in the market? We found that the available tools were either too expensive and full of pre-built, automated metric collectors/agents (which can be good and bad at the same time) or that these are open-source, which would require dedicated effort to deploy, maintain and scale.
We wanted to have a tool that would give us the flexibility and the power to instrument what we really wanted to monitor, in a simple way.
The product inception initiated in August of 2015 and at that time, besides Mindera’s internal development team needs, there was already an interested customer for the tool. The initial MVP was kind of a POC and was built by “gluing” a couple of open source components with some developed ones to validate the idea and value of it.
The product was raised and maintained by a team of under 10 people working from Porto, Portugal, in a rented office space.
Photo of your initial “home” on one of Mindera’s office spaces at Porto Mapfre
Take us through the process of designing, prototyping, and manufacturing your first product.
From MVP to our Beta release one year went by. After that release, besides the previously mentioned customer, we’ve onboarded three more customers and have opened up our product with a Free plan where we currently have 10+ registered users.
Photo of your initial beta release
We wanted to build something for the mass market and not a single-customer specific product. After our first deploy, we've been looking at the competition and exploring niches ever since. We strive to find ways to keep our product appealing and ensure we don't fall behind on what most competitors are delivering.
Regarding technologies, our product is hosted in the cloud - making sure our customers don’t need to worry about infrastructure demands, and the underlying key piece is a time-series database - this allows us to deliver our real-time data promise, as well as, collect huge amounts of data. We also connect to 3rd party services to deliver alert notifications. All of the other components, from the backend to frontend, have been developed by us on top of state-of-the-art technologies whilst applying software development best practices.
Our Achilles heel has been around product design. We only had one dedicated designer for our initial release. After that, it was really up to our two key frontend developers to expound on the design, all while doing other undertakings, and what great work they’ve managed!
The conflict that arose was, while we achieved to keep up with the launching of new features, as well as our own, it became extremely difficult to ensure consistency and usability. Last year we had a designer to (and solely) focus on our design needs and together with a digital marketing company also helped with re-branding our product.
That is a general lesson we have been learning as well, as our startup grows so does our internal needs. With the initial core team we had, we reached one threshold, but now as we grow, our team and skills need to grow as well.
Describe the process of launching the business.
All the funding for developing the product came from Mindera. That funding was exclusively to pay the team costs and infrastructure to sustain the product. We were really comfortable with the demands of the tech stack but not so much with sales and marketing (no real experience) - budget was tight to acquire external services for this. The process to acquire new customers was based on business synergies from Mindera.
As mentioned earlier, it wasn't a straightforward path to launch our product, but we did it and with the backing of one client. We weren't in bad shape, but we did need to start getting traction.
Photo from our website in early 2017
At first, we were able to pitch our product to our existing clients whom we thought Statful would be of help and got feedback from them. It was great to take first clients, but it did limit us temporarily to a small pool of users, which wouldn't help us deviate from the "single-point product" idea still.
Building a great product is, without a doubt, a challenging endeavor. Do a little something every day, and don't be afraid to expose it to friends, and then to people in your targeted business.
Encouraged by this first splurge, we came to social media to announce our product and its features, but it did little to attract new users (some subscriptions, no new clients).
Since launch, what has worked to attract and retain customers?
Acknowledging our lack of experience in marketing, we looked up a company that would help us build a plan for social media exposure and getting the word out. We're sure that once people got the foot on the door, it would be a lot easier to bring them in.
At about the same time, we made preparations for deploying a Free Plan. For the cost of nothing, users would be able to get a feel of the platform and, if they liked it, moving to the PRO plan is a breeze. It resulted in a few subscriptions, as well as the experience from the marketing team, where we produced a few webinars. It did get the stream started, but we didn't seem to manage to keep the users from one episode to the other.
We felt that the driving action that we needed to take was a kind of a step back, where we would be focusing on developing good content and strengthening our documentation details, as well as building up starter kits/accelerators to help first time users. It did not do so much to scale the inflow of users, but it helped us keep them, and perhaps, spread the word in an organic way (since then we nailed 2 new customers).
During the process, we found something that helped us was signing in with Product Hunt, AngelList, Indie Hackers are more places where we could spread the word.
Photo from our website analytics after publishing on ProductHunt
More recently, we’ve engaged with a digital marketing company to help us work on several points:
- Review our product proposition and messaging
- Revamp our website and logo
- Build a good set of assets that span across webinars, whitepaper, articles, etc.
The results are available on our website and looking really good, but again this wasn’t the turning point to turn on the tap for more customers.
We are still adjusting and trying a pivot at the moment, we always promoted our product as being data agnostic, able to fit in into any domain or area. This makes it very difficult both to sell and focus on potential customers. We’ll soon be in a position to share more on this, but we have something up our sleeve!
How are you doing today and what does the future look like?
There is really no catch in our business model, we have a monthly/annual recurring subscription model, which is our PRO plan. The pricing per customer is based on the usage they make of the product - measured by the average of data points received per second in a month. Our lowest threshold starts at $50 per month and grows as usage increases.
We initiated a complex and not very clear pricing model. Initially usage was being tracked by two variables - rate of ingestion and storage occupancy. While applying this to our existing customers - together with one of them - we came to realize that this approach wasn’t the best and wasn’t clear. We made a couple of iterations to finetune the model and finally closed on a single variable tracking model.
As a tip, carefully think and, whenever possible, validate and run multiple simulations on the ideas and math behind your pricing. Make sure that whatever model you define works well for your current situation, but also, for the future.
We currently have an MRR of $10k from our six customer wallet, but until we find the best way to get market attention or exposure, we are a bit limited with a very slow customer entry rate, that is purely based on business synergies.
Our current expenses are essential: team, infrastructure, and a very small investment in marketing (trying to do some validations on approaches). We aren’t in a comfortable position yet, which we believe is tied to the fact we haven’t yet been able to find the best way to get the attention of our potential customers.
Through starting the business, have you learned anything particularly helpful or advantageous?
When we first built Statful, we felt empowered by the idea of having a tool that we could use to monitor whatever we wanted, such as the development point of view as the business itself. We wanted to share this "power" with everyone else. However, we didn't predict that folks might not actually know what they want to measure. We agreed that it could be the case that our tool would only be recognized/needed once people crossed that bridge. Moreover, we would discover that a few of our subscriptions would join and never go again to our platform.
That's why we figured it would be good to equip our tool with starter kits or accelerators. These should help users get a feeling of what they can accomplish with Statful while still maintaining the flexibility to add custom metrics.
The other lesson to learn here is that, while it's true that working on a product you love goes a long way, it helps to know your audience. Building a product by betting on requisites of a small pool of clients, can result in skewed feedback and poor product validation. It would've helped for us to get straight away to a community of possible beta users and to raise validation.
The most significant advantage has been that we built the product for ourselves. To build a product of quality is a high motivator and finally drove us to meet other people to share that product with them. That's when we took Statful to technological events such as _TechDay LA_ and then the _Web Summit_, where we were able to talk to many people from different backgrounds who got us valuable feedback and potential interest.
Having Mindera as our "big-bro" company has also been of great help. They are always available to give us advice, share insights, and, sometimes, even help us with our pains.
What platform/tools do you use for your business?
We use several tools to helps us, but I can name the three main ones:
AWS which is the cloud hosting partner that allows us unrivaled availability, safety, and scalability
Mailchimp that allows us to reach potential leads, sharing content, webinars, etc., and giving announcements of new features to our customers
HubSpot as our CRM tracking tool, keep a record of our leads, status, and interactions we had with them
What have been the most influential books, podcasts, or other resources?
Two books of reference:
The Lean Startup: How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries is an eye-opener to ensure you focus on what really matters: test continuously, adapt and adjust to ensure you stay innovative.
Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers by Geoffrey A. Moore is a must-read for any entrepreneur that is trying to understand how to approach marketing high tech products.
Advice for other entrepreneurs who want to get started or are just starting out?
Building a great product is, without a doubt, a challenging endeavor. We are still making the journey ourselves and learning how to deal with growing pains. The one advice we carry out every day is: to try. Do a little something every day, and don't be afraid to expose it to friends, and then to people in your targeted business. It feels like such a cliche thing to say that failure IS an option since we learn a lot from it.
Also, really focus on validation! Be it for a new feature, or to build your business model, get as much feedback as possible. You can find a lot of resources on the Internet, from opening your MVP or product to beta testers to portals or listings where you can share what you’re building.
Where can we go to learn more?
Thank you for the ride down the memory lane. We would love to hear from you! Leave a comment or question below, and we'll get back to you. :)
Also, thanks to Starter Story for the interview!
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