How to stay sane while growing SaaS product to $6 Million ARR in 18 months

Introduction

Studies show that over 90% of SaaS startups fail, with only 35% making it to the 10-year mark and a mere 40% of these ever becoming profitable. So how did marketing tool Expandi manage to grow to $6million ARR in just 18 months? And how did the founders manage to keep calm in the process?

Follow Your Curiosity

The best ideas usually come from your own discontent with something. Rather than thinking ‘what would other people want?’, try to think of times that you personally have been inconvenienced.

Expandi.io founder Stefan Smulders' marketing background led him to wonder why, when an average B2B website attracts 100 visitors, only two or three would take action by calling or filling out a form. This in turn led him to challenging his partner Glenn Miseroy to create IP address tracking software, which they launched as a product called LeadExpress.

The product received good feedback, however users wanted not just to track visitors, but to communicate with them. At this point, Stefan turned to Linkedin, which eventually led to the development of Expandi. The moral? Always follow your curiosity… if you see a fault in something, the chances are others feel the same.

Find the Flaws in Your Competitors

When Stefan first started using Linkedin, he had only 143 contacts on his profile. However, following extensive training, his Linkedin Network became his number one marketing tool for lead generation.?

As Stefan and Glenn looked for tools to automate repetitive actions on LinkedIn, they found flaws: most add-ons involved keeping your laptop on 24/7, which wasn’t feasible for a lot of people, and some accounts were blocked by browser tools such as JetBuzz. This is where the idea formed to create a tool devoid of both of these issues, and Expandi was born. By conducting thorough research into the flaws of their competitors, Stefan and Glenn were able to create a revolutionary product that addressed these problems.?

Have a Strong Team

Expandi grew incredibly fast - much faster than anyone could have predicted. One of the ways in which they coped with this growth wasn’t by having a large team, but by having a strong team.

From the start, Stefan and Glenn handled most tasks themselves without automation tools. They were aware of their strengths - Stefan is naturally skilled in marketing and generating ideas, whilst Glenn’s expertise lies in the business side, particularly product management and technical support. By knowing their strengths, they were able to delegate tasks. Aside from this, the company hired Max Makarenko as CMO, who was passionate about the product and would act as the ‘middleman’; an invaluable team member who could resolve conflict and push both partners forward.?

Without a strong team, the rapid growth of the company would have overwhelmed Stefan, who preferred to do things through experimentation, with little consistency. He is the first to admit his shortcomings: “I never use HubSpot as a CRM, and I get confused in the processes”. Because of this, he is well aware of the importance of hiring professionals who specialize in the areas that he was weaker in.

Reliability

One of the most important things to consider is reliability.

A few years ago, Linkedin help was hacked and there were breaches in security. Many profiles lost their access to the platform and others were driven away by mistrust. For this reason, the Expandi team made it their priority to increase the reliability and trust of customers. This not only helped customers to regain trust in the company, but it also helped Expandi to understand their audience and realign their goals to meet their needs, increasing communication and strengthening their bond.???

Don’t Underestimate the Importance of Human Contact

With the rise of AI, it’s important for people to feel like they are able to talk to a human and not just a chatbot. Previously, if a client wanted to get in touch, they had to talk to a chatbot, with no idea who was behind it. Therefore, in the first few months, Stefan himself immersed himself in calls, which gave him a core understanding of why users buy Expandi. This human-centered approach not only improved the user experience but was also useful for marketing.

Be Transparent?

Rather than making vague claims without any back-up information, Stefan started using Expandi tools as an example on his Linkedin profiles. He then created blog articles, which turned into viral mini-academia and grew subscribers on each platform.

The Academy was hugely successful, not only in terms of content but also because it was free. To some, it seemed crazy to give this information out for free, but it was a great marketing tool for Expandi, and one of the things that led to them attracting one of the biggest influencers on Linkedin, who subsequently became a partner. In order to build trust, it is important to show clarity and for customers to see that the founders themselves use and value the product.

Forget the familiar?

Following such rapid growth, Stefan wondered which direction would be best to continue to grow the company. Before COVID, conference presentations and building a personal brand was the path to success, but during the pandemic, Stefan encountered difficulty.?

He set up a new routine, and was largely reclusive for 18 months. During this time, he recalibrated and rebuilt his tactics, eventually deciding to hire more people and focus on structuring the team. It’s important to take time to reflect and plan your next move - the familiar might feel comfortable but it is in the discomfort that results can happen.

Conclusion

When asked how the product grew to $6 million ARR in 18 months, Stefan says “It just happened. Magically”. However, if we look closely we can see that there were certain factors which influenced its growth. Having a dedicated team with skills in different areas, finding solutions to problems and maintaining a people-centered approach with transparency and trust all helped to push the company to the place it is at now. The path to success might not be easy, but with the right mindset it is certainly possible.?

If you are interested in the full business case, find it here: