Company Update Q4 2015

February 12, 2016February 12, 2016 Per Fragemann Quarterly Update

We completed 2015 with quite the end-of-year rally! While our mid-year results looked pretty dull, Q4 really met expectations and helped us close the year with a 70% revenue increase compared to 2014.

Finance

We made $2.9m USD in total revenues, and we had 670 active paying customers in December. The revenues dipped in the middle of the year but picked up towards the end. Our business is really quite seasonal, and sometimes major payments skew the quarterly results as well, so that would explain it.

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Our MRR keeps growing, while our customer number has stalled in December. We did increase our base price a bit earlier in the year, since we saw lots of small clients in the range <20 employees signing up and then churning. We’re seeing less new tiny signups, so we don’t think that a flattening of the customer growth rate is a big problem yet. It leads to higher per-account MRR, and that’s a good thing for now. But of course growing the customer number itself is also an important goal moving forward so we’re not taking that lightly.

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But in summary it was still an awesome year, and we ended up donating $60kUSD to charities. Read more about that over here!

Product

The really good news however is that our dev team has become super-productive. As you might remember we hired five developers back in July. One did unfortunately decide to leave us, but the remaining four combined with the four who joineds us in late 2014/early 2015 are now extremely well-trained and we’re pumping out features at an astonishing pace. Our latest newsletter was impressive already : Slack, Key Results, Multipraise, Calendar integration and more. But it didn’t mention 3 major features in the pipeline that are in beta stage now and which will ship in the next few weeks already!

Our roadmap for Q1/Q2 is huge and thanks to our new throughput we’ll be sending newsletters a lot more frequently now.

Marketing & Customer success

We almost thought we’d never find anyone, but please welcome Elle, who is now joining Linda to really boost our marketing efforts! Also, our CS team grew by two people in Q3/Q4 and we’ve added much needed capabilites to deal with all our new customers!

Take a look at the (public version of the) slides from our recent all-hands meeting for even deeper insight into what SI is up to these days!

All hands February 2016 from Per Fragemann

Company Update Q2 2015: Revenue dip, great NPS results, and the road ahead

July 20, 2015July 20, 2015 Per Fragemann Quarterly Update

We held our quarterly company update on Thursday, and here’s the high level overview.

We hired 6 full-time people into the Berlin office in the past quarter, and we’re looking to hire 5 more people globally in the next couple of months. We’re growing substantially, all fueled by our own revenues. Our new office is filling quickly and that’s amazing.

Finance. On track, but..

We’re on track for our goal of $3m revenue in 2015 and our pipeline is full, but due to our seasonal business and our terrific Q1 results, there’s a quite visible dip on our revenue chart. We always see more interest in the winter months than in summer, and we made 60% more than last year’s Q2. But still, we’re a bit sad the drop was this strong:

Fortunately, our Monthly Recurring Revenue chart shows that the situation isn’t all that bad:

Our MRR growth has stalled in June, but this has happened before, so we’re not worried. July has started out really promising, we made $130k in the first two weeks already. We have outstanding invoices of $155k, which means the pipeline is full. Our goal remains to make $3m in revenue this year, and we think we can still make it.

Net promoter score

We conducted a proper Net Promoter Score session in the past couple of months. We sent close to 900 emails to our HR and Admins at all our customers, and we achieved a 32% response rate. Our total NPS score is 30, which is pretty good. However, the NPS distribution is a bit uneven. If we take the two most extreme segments, we see a score of 40 with longer term clients with over 100 employees, but -9 with clients of less than 50 employees who have been with us less than 6 months. So there’s lots of room for improvements!

Goals for Q3 and Q4

We need to improve the product faster. Our largest projects – the objectives overhaul – has been in the making for 7 months now. It’s going to be really awesome and will help us get new clients, but the project need to get wrapped up. Working on that. The new 5 developers are already shipping some features, and by the end of the year we should have significantly higher throughput of features and improvements. The main challenge is know when to stop, and to avoid gold-plating.

We need to reduce our churn. Retention of larger customers is around 92% annually, but we see 50% annual churn on customers of 30 employees and less. This is totally in line with the NPS mentioned above. We’re simply not the right tool for some of the smaller clients, and we need to get better at telling evaluators upfront if we’re not the right tool for them. We’re increasing our minimum spend to $150 per month, making it clearer that a small client shouldn’t choose us just because of our affordable pricing.

We need to get better at onboarding new clients, ensuring they are happy, that they get the most out of SI, and that we keep them on board. We’ve started a “Concierge”-experiment, calling all evaluators that seem to be a good fit, offering help and establishing a relationship early on, so they know we’re around to help in case they run into issues. The next step is to call new clients a month in into their purchase and offer help proactively. We have a few more ideas but it’s too early to tell.

Lots of work ahead, and Q3 won’t be a walk in the part. But what would life be without challenges!

Full presentation

Here are all the slides from the presentation in one piece:

Boom! Five new developers on one day.

June 5, 2015June 5, 2015 Per Fragemann How we work

The hiring drought in our Berlin HQ is over! Our development team just grew from 8 to 13 developers, and we’ve been able to find a perfect mix too: We’re joined by two Java developers (Alison and Tobias, left-center and right), two AngularJS developers (Alexandre and Peter, middle) and one UI/UX developer (Kristof, left).

Five in one day? Surely we’ve lowered our expectations?

Not at all. 2014 was a very slow year, but since October we’re seeing a really steady stream of good applications. It took us a while to get there: Lots of employer branding, conference attendance and sponsorships, meet-ups and blog posts, and of course ads on BSJ were required, but the work has finally paid off. And our grilling process has remained exactly the same as always: Informal phone call, one or two on-site interviews, and then 2 days of trial work. No magic, just friendly applicant-grilling.

Admittedly, it’s sheer coincidence that everyone wanted to start on the same date. We made an offer to Peter as early as February, and then we inked contracts with Tobias and Alison in March. For a long time we thought that was it, until Kristof and Alexandre signed up merely three weeks ago, also with a starting date of June 1st. Crazy!

So in summary, there’s no secret sauce, and our applicant pipeline is now dry.😦

What’s next?

The first week was a huge success already, we’ve conducted a proper on-boarding exercise that included plenty of technical presentations, meet&greet with the international CS team, pair-programming and naturally computer setup. It’s Friday evening now, and the first small feature improvements are already on master and deployed to production.

We’ve expanded each sub-team a bit (5 on objectives, 4 on user-import, 4 on the improvements team) and then most likely we’ll move to a 4-subteams-config once everyone has truly settled in. We’re not expecting miracles during the first couple of weeks, but since the grilling process was pretty intense we’re very confident that our feature&refactoring-throughput will increase substantially. Go team!

PS: We’re still looking for a Senior Java developer.

Company Update Q1 2015: New office, 500 customers, $800k revenue

April 17, 2015April 17, 2015 Per Fragemann Quarterly Update

Time flies, and it’s spring already!

We’ve completed an outstanding Q1, we’ve moved office, and we’re celebrating our office warming party Thursday next week! But let’s see in slightly more detail. Here’s the summary from our recent all-hands meeting.

Finance

Our revenues have gone through the roof in Q1, we collected almost $800k in those three months. We now have over 500 customers, and our MRR is approaching $200k.

The outlook is very positive, we already collected $100k in the first two weeks of April, but we do expect to see lower revenues in Q2 since many companies prepay for the year and customer activity is typically lower in summer. No worries though, the overall trend is upwards.

Product

We’ve shipped several improved features in Q1 (objectives overview, messages rewrite, guidance hints) and some large improvements are close to launch. Our growing dev team has definitely picked up steam!

Support & Customer Success

Our support load had gone up considerably in Q1 due to lots of new customers, but the response time hasn’t suffered, typically we resolve support tickets within 24 hours. Lots of product improvements have been implemented to address commonly asked questions and challenges clients run into

Recruiting

We’ve managed to sign 3 contracts and the fourth offer has been verbally accepted, so by July our Berlin team should consist of 16 people, bringing our company total to 20. Our new office is very spacious though, so probably it will take till autumn until we really make use of all rooms!

Even more detail

These are the slides from our recent All-lhands meeting, containing a lot more detail about features shipped and projects worked on.

Office warming party on Thursday 23rd!

April 16, 2015April 16, 2015 Per Fragemann Party

We moved into our new office over a month ago, so it’s basically 5 past 12 for our office warming party:

We’re inviting colleagues, clients and friends to celebrate springtime and our new office too! Starting 7pm on Thursday 23rd of April, take a look at our new office in Berlin Mitte, have a few drinks, discuss the future of SI, or simply enjoy some good music!

Please let us know how many of you will be showing up, so we can plan ahead.

Neue Schönhauser Str 13
10178 Berlin

Our new office has doors.

March 16, 2015March 16, 2015 Per Fragemann How we work

We’ve loved our old office because it was very pretty, and its open layout allowed us to grow from 3 staff to 11 while being very flexible with our desks. We’ve hosted our international team members and had sufficient space to run public BBQs and Meetups. The old office cost us about $1600 per month for 115 square meters – a total bargain.

But also, it was getting noisy once we grew beyond 6 staff. Discussions needed to get planned ahead (or moved to a café nearby), and every applicant who came in was yet another distraction. We didn’t realize just how densely packed it was until seeing the bird’s eye perspective in our time-lapse moving-out-video:

Startups don’t have to use open plan offices

We don’t believe in open plan offices, but we’re not fans of private offices either. In our opinion, every team should have their room, and teams should be between 2 and 4 people. Teams should be able to chat and discuss without disrupting everyone else. Unfortunately, finding a matching office in Berlin is tough, at least if you want the office to be beautiful as well. Most beautiful offices were either too small, or only supported open plan layouts.

But after 5 months of reading very many ads, we finally signed a lease and moved in last week. We’re still busy refurbishing, painting and buying furniture and lamps, but it was worth the wait!

The office has a very interesting floor plan, no room is like the other, and there are lots of wide doors. We can keep the doors open for maximum inter-team communication, or close them during discussions. We’re placing couches into most rooms to support impromptu meetings, and there are several large and small rooms for longer discussions too.

There’s still a lot of furniture missing, and several rooms require renovation and painting, but here are two glimpses into what it’s going to be like:

Pricey, but…

The price tag is roughly $7000 per month (including heating and taxes), which is quite the stiff price tag for 270 square meters in Berlin. But location and style do matter for employer branding, and doors and flexible room sizes are crucial for productivity and employee happiness, so we see it as an investment. And yes, even as a startup you need to invest, and the benefits of a great office (with doors) outweigh the costs by far.

Fun facts:

The new office used to be a personal shopping area for a fancy clothing store downstairs, and we’ve kept the style of most rooms.
There used to be an actual bar in the red room above. It was taking too much space though, so we bought a (supposedly) 1830s travel-bar at an auction instead
O2 wasn’t able to provide internet within 4 weeks, so we’re using LTE for 11 people in the first two weeks. It worked surprisingly well once everyone had turned off automatic system updates…

We’re far from done renovating, but we’ll host a house warming party once we are. So ping us if you’d like to pop over for a drink from the mobile bar!

Unexpected UX session with the customer success team

February 8, 2015February 8, 2015 Per Fragemann How we work

Being a distributed team we can never communicate “too much”, so we’re making it a habit to always share news and recurring things like meeting minutes on our intranet.

But the best thing is when communication between teams “just happens”.

Below I shared a screenshot for an improved “this list is empty”-screen. First, nothing happened at all. Then the next day the customer success team in San Francisco noticed and started making suggestions. It turned from pure language-level suggestions into a real review of the user experience of that screen (the discussion went on for two more screens), and the resulting screen is of course much better than what we initially came up with in the Berlin office.

It’s nothing earth-shattering, I know, but I really love this cross team/ cross timezone thing, and how well it can work out even for the small things. We usually post feature specifications onto Confluence since it’s better suited for larger discussions, but using Hipchat for all the small things is just as great.