I launched Formsable earlier this year leveraging my past experiences. Formsable provides entrepreneurs insights into where each of paying customers are coming from. I started my own business in 2016. The four year journey to the product has not been easy but I have been able to succeed through continuous market validation. In this article, I share my insights on how to reduce risk in launching a business through learning about customer pains from one's career.
When I decided to launch a business, I had to find which of my skills were the most marketable. Having exposure to web application development in a few industries, I concentrated on what I knew. Researching niches in the sector soon led me to create a software development agency. After measuring success selling different development services, we focused on helping businesses to automate their existing processes and Software as a Service (SaaS) founders to launch.
The agency was never my end goal. What it did provide though was the benefit of being exposed to a wider range of customers with a diverse set of business problems. From here I could observe a pattern and see what opportunities could be productised.
Domain expertise is the foundation for a product idea
Being able to leverage past experience was key to me finding the initial product idea. In my case, it was a mix of data integrations' architecture experience from previous jobs, a solid understanding of online marketing, knowledge of sales attribution and working with clients to improve CRM and data processing.
My first prototype was launched in 2019 when I built a sales funnel and integrated analytics for my own sales process. Here I could understand the limitations of existing tools that other businesses used first hand. Existing products were either simplistic and inflexible under a guise of being easy to use, or designed for handling data for multimillion ad campaigns.
Businesses who either sell in niche markets, approach a new market or sell a new product, generally had to code their own solution or accept uncertain unreliable data and substandard online ad performance.
My first Formsable prototype was to demonstrate that there is indeed a better way to build sales funnels technically, not just a more logical and efficient one, but also a way to improve audience targeting on Facebook Ads and other ad platforms.
A prototype is not a product and so there were marketing iterations that I had to make.
Going to market with an initial version of the product requires understanding of the customer.
Going to market with an initial product version, I needed to understand the customer segment I was going after. Thankfully, because of my previous experiences, I could approach the businesses whom my product was designed for: small businesses and SaaS start-ups seeking to learn where their customers come from, wanted to ensure that correct marketing sources are stored in the CRM and that attributed purchases are available for reporting in Google Analytics, Facebook Ads and any other systems.
Going to market with an initial version of the product helps to validate market demand.
Going to market with the initial version, I had two goals in mind:
1) Verify whether my approach would be shared by potential customers
2) Learn more about actual customer needs.
Everyone approaches online sales funnels slightly differently, depending on what works for a particular business and its team. I wanted Formsable to embrace this diversity whilst still remaining a SaaS product that can be used by multiple users and scale.
With these two goals in mind, I could also quantify what exactly Formsable was offering. Our pilot customers experienced 5-7X return on their ad spend (RoAS) increase and became aware of where exactly their revenue was coming from. I also discovered that regular off-the-shelf analytics solutions resulted in only 20-70% of revenue having known marketing sources. We increased this figure to more than 90% for most of the customers.
Use your customer market to shape the product
The first customers acquired were instrumental in shaping some of our product features and highlighted what exact functionality of the prototype was most important to them.
The most exciting moment in building a start-up is to hear genuinely excited feedback for your product.
When we got a high engagement with our target customers, we were surprised. Whilst most marketing books explain this in theory, it is REALLY challenging to believe just how positive users can be for the right product - even in the B2B space.
A never ending customer feedback loop
When I reflect on my journey, what I think of what made Formsable a success was the ability to leverage my previous experiences. I built up greater market knowledge and could combine my product concept with iterations based on market demand and customer feedback. There needs to be an initial gut hypothesis rather than just being entirely reliant on customer feedback alone but the feedback is a valuable signal to help iterate and develop a product that one's customers will love.