Monthly Recurring Revenue (MRR) is a critical statistic in the SaaS industry. There are many key metrics to monitor when building your company, but before you can focus on churn rates or lifetime value of customers, you first need monthly income. This can be quite a challenge when starting out. Friends and family may be willing to test your product, but when the time comes, how many are ready to pull out a credit card for your service?
We are a Competitive Intelligence SaaS startup based in Berlin. We not only created a comprehensive plan that took us from 0 to over 2K in under one month, we documented our learning experience through the Preparation, Private Beta, and Open Beta phases. Here’s our in-depth case study on how we gained traction while making income that helped us secure funding.
Set Up a Launchrock Page
Launchrock makes things easy in the beginning. If you follow the lean startup method, you know that you need a solid product/market fit. Launchrock can help you determine whether there is enough of a fit to build your idea by experimenting for initial interest. Set up and then market your page via industry relevant channels. We budgeted $50 for LinkedIn ads, and our conversion rate was over 15%. Set a goal for success: it could be a 10% conversion rate of visitors to signups. Within one month, we had 120 signups, which exceeded our goal – Rivalfox would launch.
While you could build a launch page yourself, there is no reason to reinvent the wheel. Launchrock already has growth hacking functionality built in. After someone enters their email address, it automatically prompts them to share it, and allows you to set your own growth hacking parameters. For instance, if you invite five customers, you will be rewarded with access to our private beta.
Set Up Your Blog ASAP
Become an industry leader and create buzz before you launch. Consumers don’t want to be sold to; they want valuable resources from a source they can trust before they buy. Be that source. Answer industry questions, make yourself valuable. If people trust you, they are more likely to use your product.
Blogs are effective at driving traffic, which is especially critical in the very beginning, when it is often only friends and family trickling to your site. HubSpot found that businesses which blog more than once per week add new blog subscribers at twice the rate than businesses that blog just once per month. The report also showed that blogs that have accumulated at least 51 posts see 53% more traffic than blogs with 20 to 50 posts. Blogs with more than 100 posts see three times more traffic, while those with over 200 posts see nearly 4.5 times as much. Adding content steadily can create serious results.
We launched our blog prior to Open Beta and received well over 10,000 page views within six months. The traffic was great, but the conversion rate from blog readers was lower than we had hoped, as were newsletter signs ups. We decided that we needed more prominent calls to action. We introduced a screen for newsletter sign ups and linked with Aweber – this was featured front and center and increased our newsletter sign up 100%. We also introduced a popup which opens after ten seconds and asks if they want to check out the Rivalfox page. This popup increased the number of people going from the blog to the trial page from 5%-15%, which skyrocketed the number of leads.
Consider Guest Blogging
B2B marketers who use blogs generate 67% more leads per month than those who do not. Building an audience and establishing trust takes time, but sometimes this can be sped up through guest blogging. With guest blogging you are gaining exposure to a wider audience who will eventually know and love you too. There is also an authority that comes with guest blogging. Anyone can start a blog, but readers assume that an invitation to guest blog means that you are an expert. So far, we have taken two stabs at guest blogging that did not result in a ton of traffic. When considering this option, be sure to reach out to blogs with a huge following consisting of your target audience. Shoot for the stars; don’t think too small.
Take Advantage of Social Media
Social Media allows you to create buzz about your company, share all your amazing blog posts, track what people love and hate about your competitors, and build relationships with key influencers who may help you down the line.
First, figure out what channels work best for your product. This will be an experiment. Start with activity on all major channels and track the volume of traffic and interest that comes from each source, then bump up your efforts on those sites. For us, as a B2B company, most of our social media leads come from Twitter and Quora. We had plenty of views from LinkedIn, but they didn’t convert. Mostly, these LinkedIn visitors were in the competitive intelligence industry and, while they might be interested in what we are doing, our product is not geared for their use. Quora turned out to be a big winner for us; one person answered a question about CI and mentioned Rivalfox. It brought us a lot of leads and the conversion was over 15% from visitor to trial.
Leverage Your Contacts
Start by finding Beta/Alpha testers through your current network. This can be friends, family members, and professional connections. Our founders had launched a startup previous to Rivalfox, and the contacts they made through that venture proved invaluable.
Utilize Startup Directories and Services
After you have worked out some of the major product kinks, it is time to get your startup noticed by early adopters. We utilized dozens of startup directories and found hundreds of Beta users, some with significantly higher conversion rates than others.
Erli Bird – A directory which allows early adopters access to different Beta products and highlights what services are going to launch soon. According to American Genius, “Erli Bird converts early tech adopters into a viable user base for startups before they spend time on development, giving early stage startups a means to test their ideas and gauge reactions prior to investing time and money in an idea that could flop or succeed wildly – either way, startups will know before they go public.”
Betali.st - An awesome tool that allows early access to new startups each month. We gained over 400 signups in two days with a 30% conversion rate from visitor to trial! One factor to note when considering to use Betali.st is that you have to wait several weeks until you are featured, unless you pay a fee. At Rivalfox we didn’t pay that fee, but if we had to do it all over again, we would definitely pay for better timing. Betali.st would be extremely helpful in the open beta phase. We were featured during our closed beta phase; once we emailed those 400 people to announce our introduction of open beta, only half signed up.
CSSMania – CSSMania is the worldwide leader of the CSS Showcases genre. It is a website that features homepages with great design. Of course, success really depends on your target demographic, but for us, CSS Mania led to 15 signups.
KillerStartups – Killerstartups is a site that allows you to submit your startup by category. It takes three to six months to review your startup and possibly publish your article, or your could pay $167 to be featured within 48 hours. We paid this fee since the traffic to the site was really high (even higher than betali.st), but it was a complete fail. Our $167 only led to four sign ups.
Producthunt.co - Producthunt is a daily leaderboard of the best new products. You can self post a link to your product. Our post brought us 14 leads in one month.
Other Startup List Resources
Gather and Listen to Feedback
Customer feedback is crucial in the Beta phase. We installed and quickly fell in love with Intercom, an awesome tool that lets you generate automatic messages after sign up and, after 29 days, communicate with handpicked customers. Here is an example of an automated message with the survey:
Thank you for using our product. We’re constantly working to improve our quality of service as we progress through our early stages of beta, but here are some features that you can expect in the near future:
Save time by selecting special areas on the website you want to monitor and name those to get more precise results
Benchmark your competitors in an easy dashboard overview. Additional: More KPI’s to come -> Drop us a short email if you wish something specific
Reports are going to be more precise and focused on the essential information
So if at all possible it would be great if you could tell us what we can improve (it only takes 2 minutes):
Co-Founder & CEO
PS: Learn more about Competitive Intelligence in our Blog.
Use MailChimp to Announce Open Beta
When we were ready to launch out Open Beta we already had a list of 700 people from our combined efforts including our blog and the signups from Launchrock and betali.st. We announced this through MailChimp and it garnered us 300 signups.
To Pay in Advance or Not to Pay in Advance? That is the Question.
At first, we started with credit card required, which led to 20 customers who signed up but only eight which remained customers after the trial. After one month, we switched to no credit card required – many more people signed up for the free trial and our conversation rate grew 5-10%.
We received plenty of leads on a daily basis, but the average breakdown looked like this:
Organic – 31.85 %
Referrals – 12.7 %
Social - 28.12 %
Direct – 26.5 %
After much analysis the key lessons we learned were:
Start blogging ASAP
Our blog pushed thousands of visitors to our website prior to launch and allowed us to start building our valuable email marketing list early.
Connect to Industry Leaders for Opinions
Using social media allowed us to connect with industry leaders who shared our content and provided invaluable insight into our product.
Experiment in a Controlled Way
While reading advice by fellow entrepreneurs is helpful, there is no perfect formula for how to launch your product. Do controlled experiments to see what works best for you. For example, by reducing our Trial Period to fourteen days instead of thirty, and using Intercom to contact people and concentrating on people who signed up for the trial, we increased our conversion from 4.7% to over 14%.
Concentrate on Inbound Leads
Connect your sales team to inside leads and concentrate on making those first customers 100% happy. Use Skype, intercom, or targeting email campaigns to check in. If those inbound leads love your product, they will share it, creating more inbound leads, which are so much easier to go after than cold calls.
Don’t Be Afraid to Ask People to Pay Early
If you ask people if they like your product, most will say yes. The real question is: do they like your product enough to pay for it? The earlier you can get this information (and the earlier you can start making revenue) the better.