Sramana Mitra: Did you launch as a software company or as a marketplace?
Diego Gomes: I launched it as a software company. The first year was very challenging. Although we were having a little bit of success in selling to customers, the problem was that they were buying a content marketing platform, but they weren’t creating enough content.
They wouldn’t renew and as a result we didn’t have a great retention rate. We noticed that we needed to provide more than just the software. We needed to provide a talent marketplace for them to start hiring talent and build long-term relationships with freelancers, otherwise we wouldn’t be able to succeed.
Around six months in, we started selling our software and access to the marketplace and that’s when things started to work. Our first ten customers were our close friends in the marketing industry. They were risk takers who were excited about the decision.
Out of this group, we noticed that the ones having more success were the ones leveraging our talent community. Once we opened it up to everyone, we started getting traction in reaching to more customers.
Sramana Mitra: In that transition did you stop selling the software and did you completely move into the marketplace model?
Diego Gomes: No, we never shifted to a pure marketplace model. We always kept evolving the software to provide better integration with the marketplace to properly help them manage the content.
Sramana Mitra: You sell the software as well?
Diego Gomes: Yes, we have a content marketing software, website hosting solution, and we also have an interactive content marketing platform beyond the marketplace.
Sramana Mitra: Let’s go back to the beginning in 2013. What level of traction did you get? Whom did you succeed in selling to? What did you learn from that?
Diego Gomes: It was a challenging year in 2013. The first customers we had were small businesses. We were attracting them through our blog and social media channels. We were very evangelistic when preaching about content marketing, how it works, and educating the Brazilian market.
After six months of failing at being able to acquire customers systematically and getting good retention rates, we decided to shift completely to an inbound sales model to sell the software, marketplace, and professional services.
I remember that we had a conversation with my co-founders because we were in a hard situation. We were bootstrapping and it was very hard to pay the bills. We made a promise that if we couldn’t make 100 customers in six months that we would close the business.
The deadline that we set was October of 2013. This was a powerful decision for us because we started to segregate jobs. One would handle the customer relationships, the other would run every marketing demand generation effort, and I would run the sales. Every effort and initiative in the company at that point was to get us to the first 100 customers.
It was a big success in the first month of adopting the new model because we closed eight customers. In the second month, we closed 20 customers and in the last month we added another 25 customers.
It started growing after that. It was a very big initial victory for us because it was the first moment that we had a shared belief that this was a real business and that there was a demand for what we do.