Customer.io 2018 In Review

John and I started Customer.io in 2012 to prove that we could build a business to support the two of us. Six years and 42 people on the team later, we’re grateful each month when revenue increases that this amazing journey keeps going.

Customer Satisfaction

The team increased customer satisfaction achieving our highest rating to date of +48 in November. December stands out as a regression that we’ll need to dig in to!

Volume of Messages

Our customers sent 5.5 billion messages with Customer.io across all message types (email, push notification, SMS, Slack, webhook action). We want to help people send fewer, more meaningful messages but messages sent gives you some idea of usage.

Revenue

The year ended with the business at $700k in Monthly Recurring Revenue (MRR) or $8.4m in Annual Recurring Revenue. That’s an increase of 37% from December 2017.

Return to Profitability

We had several months towards the end of the year where we increased cash. Boy, that’s a much better feeling than burning. Our goal is to return to profitability in 2019.

Leadership Learnings

Key Initiatives

We did our version of OKRs called Key Initiatives every quarter in 2018 (a first for us!). Each quarter, we had between one and four Key Initiatives. Here’s one: While not perfect, setting formal Key Initiatives is better than the alternative of drifting aimlessly (we tried that too).

A System for Management

You need to pick where you want to innovate and how we manage people wasn’t one of them. This year I was excited to finally find something we could adopt and achieve good results. The Manager Tools approach has worked really well for us with some modifications for distributed teams. I started exploring it after learning about it from Wade Foster of Zapier. We now use the manager tools 1-on-1s and feedback model as a baseline for what people should expect from managers at Customer.io.

Mission / Vision / Strategy

We re-articulated our mission: Power automated communication that people like to receive People use Customer.io to automate and gain efficiency, but automation is usually cold and inhuman. There’s tension in our mission to make automation human and valued by the people on the receiving end of it. We spent a lot of time trying to craft a clear vision to rally the team behind and are proud that ended up with: Vision: Create the single tool relationship businesses need to send targeted and automated messages to their audience What’s a relationship business? Any company that values you beyond a single transaction. A typical gas station is probably not a relationship business, but your insurance provider is. From our vision, we came up with a strategy we’re going to start executing against in 2019. That’s internal only for now.

Board Meetings

As part of the terms of our last financing round, we created a formal board and nominated an independent board member by the end of 2017. Initially, I approached board meetings as a place that I’d be scrutinized. Someone gave me advice that the board is the place for you (if you’re the CEO) to bring the problems you want help solving. That mindset has helped me. I enjoy preparing and taking time to step back. We get a lot of value out of our quarterly board meetings.

Company Highlights

Premium + Customer Success + Deliverability

We added a premium plan that includes a Customer Success Manager, access to premium Technical Support, and SLAs. We realized that larger organizations and companies that are growing quickly have more complex needs. By pairing customers up with someone really knowledgeable, we’re able to help them be more successful and provide a lot of value. That split between basic and premium also means that people who don’t need SLAs, deliverability help, and dedicated IPs don’t pay for them. Our Customer Success team now covers 98 premium customers.

Building Out a Partnerships Function

Partnerships is now a formal role within the company. We’ve had both technology vendors and agencies within our ecosystem for several years and wanted to make it easier for those partners to be successful with Customer.io. We’re committed to the relationship: we provide a person to contact and material specifically for partners.

Experiments with Advertising

We spent $185,000 across Facebook, Twitter, Reddit and Linkedin. Paid ads helped us quickly figure out what keywords our audience is interested in. Starting broader and narrowing down was a better approach than starting narrow and broadening. Building a quick way to add new landing pages helped us deliver a tailored experience. The net result was we doubled trial volume and have more confidence we can insert money to drive demand than we did before.

Calmer Engineering

Engineering was hectic at Customer.io every year before 2018. At the beginning of the year, we completed a migration from our legacy infrastructure to Google Cloud. Architecturally, things got a lot simpler, which allows us to provide a higher quality of service. The new infrastructure is maintained by our Site Reliability Engineering team and is no longer the responsibility of the Backend Engineers. Additionally, we added formal Quality Assurance and improved our deployment process. All of these changes mean our engineers can focus more on making the service better, rather than jumping from fire to fire.

How We Build the Product Improved

We implemented a version of Spotify’s Squad model and now have three squads working on improvements to Customer.io. We tested working in squads by building native Push Notifications at the beginning of the year. We had a team of four (product, design, backend engineering, front-end engineering) focused on Push Notifications. They became subject matter experts, talked to customers, and shipped multiple iterations of that feature. Their work convinced us that organizing into squads would be great for the rest of our efforts. To make squads work, we went from two to six people on Product by adding two Product Managers and two Product Designers. Now it’s time to tackle some meaty product challenges!

Design Improvements – Rolling Out in 2019

Adding more designers to the team helped us address a lot of “design debt” in the company.

Creating a New Identity

We worked with Unfold to create a new identity for Customer.io. That work was finished in December; we’re now working to roll out an update across the company.

Design System & Style Guide

We began chipping away at standardizing our UI in the app, and our design principles. I’m proud of the team’s decision to commit to accessibility. It’s wonderful to see people apply our values of empathy, transparency, and responsibility to any of our business decisions. Another exciting thing is to see us reimagining Customer.io. We’re still in the early stages of exploration. You should start to see some pretty great changes to our look and feel in 2019.

GDPR Compliance

Businesses should respect people and their data. Raising the bar is a good thing; we were happy to see the EU leading the charge. It was expensive to do the work needed to comply with the new GDPR requirements and remains to be seen if the EU will become more aggressive in enforcement. Either way, companies using Customer.io are able to comply.

Company Retreats in Chicago and Quebec City

The company got together twice this year—once in Chicago and once in Quebec City, Canada. With a bigger team, we’ve started doing small group dinners and make sure we have lots of planned events in addition to hack projects. Highlights for me were cooking dinner with the team, curling, and the architecture in Chicago!

Expanding Our Team to Asia

Most distributed companies hire within a few time zones. When one of our engineers decided to move from Poland to Australia, we saw it as an opportunity to learn how to work together across time zones. There are now four team members located in Asia: India, Bangladesh, Pakistan, and Australia. To me, building a great team means building a global team. Distance and time zones present real challenges that we’ll continue working to overcome. One thing we have learned is that neither of time nor distance prevents great people from doing highly impactful work.
I’m proud of the team’s accomplishments in 2018. We made a lot of progress improving how we work together. The core parts of the company are stronger to set us up for more success in 2019!


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