Sramana Mitra: What did you learn as you went through the customer base, started getting to know the customer base, understanding the customer base, and understanding who’s converting from free to premium?
What did you learn in terms of who were the ones that were really important for the business from a segment point of view?
Ryan Chan: I had this belief very early on that it is the technicians or the end users that we are building the products for. Our entire product is centered around the maintenance technician.
So I always had this idea in the very beginning that what would happen is the maintenance technician would download UpKeep, use it for him or herself, and then bubble it up and try to sell it to their boss. But what we realized is that it’s actually very difficult to sell.
We’ve learned over time that the end user is not always the one who makes the purchasing decision. You can segment and funnel off these two different profiles into different types of campaigns whether it’s marketing campaign or sales campaigns.
Even product onboarding processes that guide them towards different things because we know for a fact that a technician who downloads the app is going to be a champion for us if they continue using the product. But they’re not going to be the ones to put in a credit card or sign a terms of service agreement for the entire company.
Sramana Mitra: We, at 1Mby1M, have what we call Sales 2.0. If you went through that, you would have known all this right away.
Ryan Chan: I know. I should have done that. So what we realized is, if a technician signs up for Upkeep, our goal is to get them to use the product heavily and have them buy into the product. Then we will try to convert them at a later stage in the process by pushing them towards marketing collateral that says, “This is how you can help your entire team.”
This is very different compared to selling or converting someone that signs up. It’s, “Here’s a high-level overview of the product. Here’s how it can help you streamline business operations and help you make data-driven decisions for your entire team.” Even the product on-boarding is different for the types of users that sign up for UpKeep.
Sramana Mitra: As you went along, you must have hit upon some sort of repeatable sales cycle. When did you hit that? What was that repeatable sales cycle that you hit on?
Ryan Chan: Let me finish up my journey. We had just come to the beginning. So I’d quit my job as an iOS developer and started working on UpKeep. I applied as a solo founder. At this point, it was literally just me working on the product. I applied and got into YCombinator.
The first thing that they said to me was, “You are doing way too much. Go and hire someone.” So I hired a friend of a friend whose name is Kevin Phung. Actually, he’s still here. He’s like this Jack of all trades. We went through YC together. It was an amazing experience.