Price Intelligently is a services business that helps some of the world’s best SaaS companies optimize their pricing, including Zapier, New Relic, Wistia and Optimizely.
ProfitWell is a platform that gives SaaS businesses a powerful dashboard to track the financial health of your subscription business, including key metrics like MRR (Monthly Recurring Revenue) and churn.
In this interview Patrick shares how he’s managed to grow Price Intelligently and ProfitWell completely bootstrapped. He also discusses strategies to optimize your pricing, how to create a customer feedback loop and how he’s created an internal culture of customer obsession at his companies.
Christie: Today I have the great pleasure of speaking with Patrick Campbell of Price Intelligently. Price Intelligently is a great little company that helps software as a service leaders come up with the right product for the right customer and for the right price in order to boost revenue and, most of all, make happy customers. Welcome, Patrick Did I get that right?
Patrick: Yeah, it’s good to be here. Yeah, yeah, yeah. There’s a lot of stuff we’re doing, so yeah, it’s one of those things where, I think that hits it on the head, or at least the centre of it, which is great.
Christie: Excellent. I read a little bit about you and, okay, so how does someone who worked in the US intelligence world, makes me think of, like, the CIA or something, and Google come to create something that turned into Price Intelligently?
Patrick: Yeah, that’s a good question. So my background in econometrics and math, and so I worked at both of those places. I was doing, essentially, economic modelling for different targeting. So when I worked at the NSA working on ways to basically find bad guys, let’s say, and then [inaudible 00:01:25] working at Google finding money. And ironically, or coincidentally, depending on how you look at it, using kind of the same methods.
For me, the reason that I didn’t stay working in big corporate, and, you know, working for the US government is kind of big corporate, even though, obviously, it is the government. But it was a lot of bureaucracy, at least for me. There were situations when I was working for the government where people, they would say jokes like, “Oh, yeah, so and so, he’s been here for 30 years, hasn’t done a thing in 10.” And you kind of joke around, and like, “ha ha” when you hear that, but then you’re like, “Whoa, they actually aren’t doing a lot,” and advancement isn’t there. And just all of the … Obviously there’s reasons that it’s hard to fire people in government and all of that kind of fun stuff, but it definitely was like a really, really big bureaucracy where it was really hard to get things done at a good speed.
Interestingly enough, I felt that at Google as well; a very, very different type of bureaucracy, but any entity that’s more than 10,000 people, let alone 30,000, 40,000, 50,000 and more is obviously going to have some level of bureaucracy. It’s not necessarily bad, but for me it just really affected, right at the, probably worst or best time in my life, you know, being a young person trying to go, go, go, go, go, get things done, and then hitting roadblocks that were good and bad. So that’s what kind of led me to kind of push towards essentially getting to a smaller and smaller organisation, and then eventually an organisation of one, or at least that’s how it started off, of just me in a room banging my head against the wall working for 16, 18 hours a day in the beginning and kind of bootstrapping the business.
Christie: Okay, so knowing that you came from those two very different worlds but kind of essentially used the same skills to do that, what did you take from those experiences to decide that something like Price Intelligently needed to be created? What need were you fulfilling in that?
Patrick: Yeah, I think, so the need wasn’t necessarily direct. It was kind of … It wasn’t like I was at either of these entities and was like, “Oh, pricing. That’s a thing.” Right? It was more I think that there was a confluence of a bunch of different things that were happening. One, I think I had probably the best analytical and best logical training that I ever could have received working for the government. Then, I think I received some of the best culture, like, operational experience when I worked at Google, just because having a culture that that’s … And it’s bureaucracy, and that’s fine, especially on the business side which I worked on, it’s like Disneyland for adults. So everyone’s super happy, even when they’re sad they are still happy. So, yeah, yeah, so just learning so much at an organisation like that.
Then, when I really got into understanding like, “Oh, here’s a problem that I can actually solve with that background that I received at both of those entities,” was … I worked at a smaller company in Boston called Gemvara, which was, it was a startup. They sold to Berkshire Hathaway a couple of years back, but basically they were doing high-end, customizable jewellery. So for those folks who know Blue Nile, it was kind of like Blue Nile but specifically for gemstones. So the average sale price I think was like $1,000 per piece, and then there was a tonne just going on with the customization, so there was some really cool technology behind it. But we would make little changes to pricing and we would see either really, really big spikes or really, really big craters in revenue.
There I learned … I’m laughing a little bit because I think there’s a common theme of not liking bureaucracy and maybe bureaucracy is code-
Christie: Right. I was thinking that.
Patrick: Yeah, yeah. Maybe that’s code for, like, “I don’t like getting roadblocked on something that I believe in.”
Christie: No. Well-
Patrick: No, that’s really what it is, I’m realising.
Christie: And that’s usually what leads people to go on their own and do their own thing.
Patrick: Yeah, totally. So kind of that confluence of all of those different experiences and then that moment of, like, “Oh, this is something that’s important, and they put someone who’s smart but not specialised in charge of solving this. No one knows what they’re doing with this type of a problem.” So it turned into, “Well, let’s jump in and see if we can solve it.”
And I was right at the point where I was just not really that happy there, and just kind of basically said, “Hey, worst-case scenario I can fail and worst, worst, worst-case scenario I have to move back to Wisconsin and live on a couch or something like that,” But I didn’t think … Yeah, it was one of those things where it’s like, I think a lot of people are like, “Oh, well, what if I fail and I don’t have a job?” It’s like, “Well, I mean, are you willing to go work at Starbucks? Are you willing to go work at somewhere else for a dream? Then you’re fine. You can at least find a job. It might not be the job you want and more than likely won’t be a fairly good paying job, but it’s one of those things where that’s what kind of led to the leap.
Christie: Exactly. Okay, so you did mention that Price Intelligently was a one-man operation when you first started, and now what, you have about 30 employees? Is that correct? Is that, around-
Patrick: Yeah, I think we’re right around … Yeah, it’s funny. We’re getting to the point where we’re doing a lot of hiring right now, so I think it’s 35.
Christie: 35 or so?
Patrick: Yeah. I think I just signed two offer letters this week as well already, so I think it’s going to be … Yeah, right around 35 is fine. I’m being too analytical [crosstalk 00:07:25]-
Christie: Well, it’s your nature.
Christie: So what was the initial model when it was just you and what was your strategy to grow it to what it is today?
Patrick: Yeah, that’s what’s really funny, because a lot of people, they think we started off as a consulting company, but in reality we started off as a pure software company. We had this piece of software … So, we developed these algorithms that helped identify this whole concept of price elasticity. So if you gave us some data points we could essentially go and run it through our algorithms and give you, like, “Here’s what your market, your target customer, whatever that ends up being, this is what their elasticity is.” And “elasticity” for those folks who don’t know because I probably learned that back in econ class and just forgot the meaning-
Christie: Econ 25 years ago. Okay, I’m showing my age. I’m sorry.
Patrick: Yeah, no, you’re fine. It’s one of those things where it’s actually pretty simple. It’s one of those things where it’s like, “Okay, if we changed the price, whether it’s higher, lower, whatever it is, what’s the impact going to be on volume? If we increase the price, intuitively you might think, “Oh, we’re going to lose volume. Not as many people are going to buy.” And if we lower the price you think that, oftentimes, like, “Oh, therefore we’re going to get more people to buy.” But it’s actually not as intuitive as you’d think, especially for software products.”
We had this software that helped software companies basically identify price elasticity and then a few other pieces. What we found, what was interesting is we had this software product, and anyone who creates a survey-based software product, unless you are going to really grind away at being the best survey tool in the world, it’s a really, really fool’s errand. Because people, they don’t, like, people don’t want to do more work. They just want the work to be done for them. So for us it was, people would come to us and they’re like, “I really want the data. Can you just do it for us?” And we were kind of like, “Well, no, because that’s not what good software companies do. They don’t do the work. They make the software do the work and they make the customer figure it out to a greater extent.” But then we eventually were just like, “No, we’ll do it for you.”
Then, the other problem that we found is that because you don’t learn about pricing anywhere, even when you get an MBA, like, you might take a pricing class but it’s very theory-based. A lot of people didn’t have a lot of confidence in how to use the data. So even if we solved the work problem they were like, “Can you just help me understand what I should be doing?” So the long and short of it is we turned into what’s called a tech-enabled service, which is basically, like, you buy the software, but you have to buy it with us. You can’t buy us to go and just talk to you about pricing or just be a traditional consultant, like, you have to use our software. Then, eventually, and this is longer down the path, we’ve launched something called ProfitWell, which is a pure software product that’s subscription financial metrics that’s free and plugs right into your billing system.
Christie: Oh, wow.
Patrick: So we now have this suite of products that basically help SAS companies or subscription companies with their metrics, with their pricing, with their retention, and a couple of other things that are coming down the pipe. Yeah, it’s turned into, basically we want to help companies get the most out of the subscription model, and we choose kind of wisely what things we do to help them basically do that.
Christie: Excellent. So in creating ProfitWell, which is the other piece that you all offer, what made you decide to make that its own standalone thing and not necessarily, like you said, you didn’t want to … It seemed like you didn’t want to sound like a consulting firm for these people. How did you make the decision as to not make that, you know, keep it all together to be a part of the price intelligently services that you offer? Whereas, a standalone, like you said, it’s free, it plugs into their existing system. How did you make the determination to make that a separate entity?
Patrick: What was interesting is, so we’re a completely bootstrapped company, so we’ve had no outside funding, no inside funding either. It was just, we got our customers and then we decided, “Okay, instead of just putting that in our pockets, let’s hire people.” Right? So the main reason we did these as separate entities originally was we couldn’t afford to risk losing the Price Intelligently revenue. So if we put this on the Price Intelligently website it would have been, “Wait, you guys are pricing, what is this product? What do you guys do?” That kind of a thing. And also, the product isn’t … it’s not a pricing product inherently. Right? So calling it, like, Price Intelligently Metrics or something like that is kind of confusing.
So we moved to ProfitWell, which was one of those things where we spent a lot of time trying to figure out the name, and then also not enough time, maybe, but that’s a whole other story. So we launched this as a separate entity, and then vision, and this is actually something that we’re thinking about is we’ll always kind of maintain the Price Intelligently brand, but we’re going to start basically merging all of the products.
So if you work with us in Price Intelligently, you’ll have a ProfitWell account. Your data might not be hooked up because you don’t have one of our billing systems or you’re doing something custom, but you’ll still log in, you’ll get all of the Price Intelligently product and things like that through the same interface, essentially.
Christie: Cool. Okay, so the the theme around several articles and interviews that you’ve given is the need to create customer-driven products. So for you and how you we we talk about being customer obsessed, what does customer happiness and success look like from your perspective, and what does customer-obsessed mean to you when you hear that phrase? And how does that translate through what you do at Price Intelligently?
Patrick: There’s a couple of ways I think about this, and I hope they’re all coherent. I think to me, and this is not a fully accepted view, but I think that customer happiness and customer success to me is actually, it comes back to equilibrium. It used to be when resources were really, really scarce, or a certain product that was necessary was really, really scarce, whoever produced that particular product could kind of hold it over you. Like, “Hey, you have to pay $10 for this thing,” because there’s no competition and they’re not incentivized to make the product better or anything like that. And that’s like a monopoly, so like purely scarce resources, they’re controlling the … they’re not allowing anyone else into the market and they also have market dominance. So those are kind of the three tenets of a monopoly.
So to me, really what a customer happiness or customer success is that both the producer, like us being a software company, and then also the customer are at that particular equilibrium where we’re both really, really happy with one another. We’re providing a tonne of value to that customer and then they’re paying for that particular value right at that equilibrium or maybe slightly there’s a little bit more of that customer surplus. If that makes sense?
I think that’s super important because I think that too many tactics, especially when it comes to pricing and a number of other things, they focus a little bit too much on, just to short-hand say it, like, “Oh, how can we screw over the customer,” or something like that. [inaudible 00:15:09] anyone’s not actually saying that, but it’s kind of like, “Well, we shouldn’t do that because we can make more money this way even though our customers are going to be super, super frustrated.” And that’s just kind of a fool’s errand in my opinion, in the short-term, even though I’m a cold-blooded capitalist economist, right?
I think this is the view of being a cold-blooded capitalist economist, is basically like, “If I produce a surplus way too much,” and I’m not describing what actually “produce a surplus means”. I should probably use that term very carefully, but it really just means if you do that too much there’s going to be just changes in the market and your customers are going to try to find another way, or someone’s going to enter into the market. But if you’re providing them a tonne of value and maybe a little bit more than you’re receiving back, I think that’s where you get really, really good customer happiness.
I think to go to customer obsessed, being customer obsessed I think means that you’re not necessarily following every single thing the customer asks for or every single thing that the customer wants, but it really means picking your customer first. What that means is, is like, “I’m going to target this customer. They look like this. And hopefully that pie of that customer is big enough to sustain my particular business, and then laser focusing on making those customers really, really ecstatic.” I think an lot of people miss that first step because they’re like, “Yeah, we’re going to have really good support. Yeah, we’re going to have really, really good customer feedback and NPS scores.” But they’re missing the entire point of really focusing that product and everything on that particular customer.
When you really define those customer personas, to me at least, that’s really the only key to being customer obsessed, because then your entire company, whether you’re 30 people or 1,000 people or tens and hundreds of thousands of people, can essentially focus everything that they’re doing on those particular customers, whether it’s what the design should look like, what the marketing page should look like, what the feature roadmap should look like, what the messaging should look like. But I think it really starts there. I think I went a little further than your question warranted, but yeah.
Christie: No, that’s perfect. That’s perfect. No, that actually … No, that’s great, and it’s a great segway into how do you specifically reach out to your customers. How often do you reach out to your particular customers for Price Intelligently and what do you do with that feedback that you receive?
Patrick: Yeah, totally. On the ProfitWell side we try to collect a specific answer to a question like once every four to six weeks. A question changes depending on particularly what we’re trying to go after. So in some cases we’re thinking of what we should build next. In other cases we’re thinking, “Oh, something isn’t working. Let’s try to figure that out.” But the research question really changes. The way that we do that, there’s a lot of different ways. One, the straight up qualitative customer development phone call. It’s amazing that people are inherently … I’m going to rant for a second here. People are inherently lazy on getting the answers to the questions that solve their problems. It is amazing, amazing how many times [crosstalk 00:18:28]-
Christie: Because they want someone to do it for them.
Patrick: Yeah, well, and that’s what’s interesting, right? But what’s fascinating is that the answers are right there. The customers are right there, and most of them are more than happy to complain or get on the phone or really just get inspired about something because they want success, they want the product to do whatever they need for them. But a lot of us, a lot of our organisations, even large organisations, even public companies aren’t doing customer development. They’re, like, brute-forcing their way to success.
The way that we try to overcome that at Price Intelligently and particularly with ProfitWell is just using a classic survey in addition to those classic phone calls, and doing it in a way that is really good for that particular customer. But if you need a high-definition answer to a question because you haven’t quite figured out what the cause of the problem is or what the problem is in general, then you need that phone call to get on the phone and talk through something, ask some good questions to get to that point. Then, once you figure that out, when you want to validate it you should be using surveys in a really, really targeted way to make sure that you’re getting those answers to those particular questions and validating basically what you think you’re going to go to.
Christie: Excellent. You touched a little bit, not too far back, on building out a buyer persona. How do companies do that when they’re first starting out? They’re just starting to get their brand on point, so how do you start with that? Tell us a little bit about actually what that entails in terms of building a buyer persona and how young companies just starting out can do that.
Patrick: There’s two schools of thought. The first school and the first tactic to use is to go very, very broad, and then over time, very, very slowly, refine, refine, refine. When I say broad I’m not saying, like, “Oh, we’re going to sell to businesses.” It’s more like, “We’re going to sell to businesses that have less than 100 people, and we’re going to sell to sales teams.” That’s still really, really broad if you think about it because there’s a whole tonne of businesses under 100 people that have sales people. Right? Then, eventually it’s, “Okay, really it’s businesses under 20 people and it’s sales teams in companies that are selling to restaurants, or something like that.” Right? It refines, and refines, and refines.
So the way to use that tactic is basically to go broad, and then what I recommend doing is there’s a whole process, and I can share that because it’s a little bit easier to kind of read through, I think, and basically start with that customer profile, and just, “Hey, this is what we think this customer cares about based on some qualitative conversations.”
Then, what I would do is I would find 12 to 20 people that you can talk to that fit that category that you’ve chosen, and it might be like two or three different categories depending on what your product is, and then based on those conversations you’re going to refine a little bit, you’re going to validate or invalidate those particular hypothesis that you had. Then, the next step is to go quantitative. Even if you don’t have customers, even if you don’t have prospects you can do quantitative research. There’s a tonne of companies out there that their entire goal is to sell you answers to surveys for people that you’re targeting, anyone from a Fortune 500 CIO all the way to a soccer mom or dad in Kansas. Those are the people who are able to basically answer and tell you what they want, and you have to ask them in the right way, and that’s very, very important. But it’s one of those things where I would do a cycle of that before you even start moving.
The reason is, in particular, is because it’s going to save you so much time. When we started building ProfitWell we built a very, very small MVP based on this fairly medium to broad persona that we thought we were going to target, and we just went and before even going out and building out we really, really focused on doing some customer development on who that customer should look like.
The other tactic is to use the exact same process, but just start very, very, very focused, almost to the point where it’s like, “We’re just going to make this one person happy.” Right? “We’re going to build something that solves his or her problem.” And then, “Okay, let’s go clone him or her. Who else is him or her?” And that’s a different tactic to use. I like building product that way, mainly because it’s easier to find and convince 10 people or 100 people to use something and then look at all the data on why they’re using it, and how they’re using it, and then go to 1,000 and 10,000, as long as you have some basic understanding of how big the market is.
Christie: I guess that’s how you sort of determine what the customer wants or doesn’t want?
Patrick: Yep, totally. There’s a couple of tactics you can use for surveys. Again, they’re probably better to read about or watch some of their videos out there. But yeah, there’s the price elasticity that we talked about a little bit. That’s actually pretty easy to measure, and it’s actually really easy to see what someone’s willing to pay for something. Then, there’s also a couple of tools called conjoint analysis or MaxDiff all about, “Hey, do people like A, B, C, or D? What does that look like in terms of what they’re actually looking for?”
Christie: Excellent. Also on the Price Intelligently blog you had an article on pricing strategy and customer churn. So what is the impact of churn on a business and how does customer obsession help with decreasing churn rates?
Patrick: Totally. I think what’s interesting is that, so acquisitions … You’ve got three parts to your business. Right? It doesn’t matter if you’re a recurring company or not. You have acquisition, monetization, and retention. Acquire a customer, charge them for something, and then either get them to stick around to charge them more, or get them to do repeat purchases if you’re selling one-time products. I think that more than anything retention and monetization are very, very customer centric and customer obsessed because those two pieces of your business require actually understanding that kind of customer and then optimising based on that understanding. With acquisition, there’s so many tools out there, and Google, Facebook, all of these different companies have made it … The barrier to getting in touch with someone is so low. You can spend a lot of money to acquire, like, anyone. Right? They don’t have to stick around, they might not pay you what they need to pay you, but you can acquire them on some level, given unlimited funding. Right?
With retention, well, just with churn in general, like, churn is like the slow killer of a business, because even if your monetization is in check, even if it’s really, really good, all of a sudden if that customer doesn’t stick around it doesn’t really matter because you’ve probably acquired them at a really, really high cost relative to what you’re charging them. It’s one of those things where I think customer obsession really, really works with churn because there’s two sides of churn. One, are delinquencies, and those are like credit card delinquencies, so that’s not a … It’s a problem that needs to be solved, and it’s actually bigger than a lot of people think. But the other side of churn, which is about 60% to 80% of your churn is actually just fractured. There is dozens and dozens of reasons that people don’t like your product. They went out of business, which is not even your fault, but you still have to deal with it, and maybe you’re not targeting the right company if all of a sudden all of your people are churning because they’re going out of business.
There’s a whole host of, like, “I didn’t like this feature. I didn’t know this feature existed. I didn’t like your support. You don’t have this thing that someone else has.” Like, there’s so many other reasons. If you’re not customer obsessed you can’t solve your churn because you’re not going to know why people are actually churning.
Christie: Do you have some tips or methods that folks that might be listening to this can do to reduce churn, or to improve on it, I guess? Because there’s going to be churn. I mean, that’s just a fact of being in business. But do you have any recommendations for methods of reducing it and improving on their customer obsession?
Patrick: Yeah, absolutely. So, full disclosure, we do have a product that helps with retention. I don’t want to say things and people are like, “You’re just selling [crosstalk 00:26:55].”
Patrick: Yeah, yeah. I just want to be sure. But, yeah, well, I didn’t mention what the product was. I was just saying, “We do have a product,” and I just wanted to make sure that people aren’t like, “He’s just pitching.”
Christie: No, not at all, not at all.
Patrick: You’ve just got to chunk it down. Approach it as like a model. So there’s two types of churn. The delinquent churn which is, I would argue in the short-term, the easiest to deal with. This just involves, and there’s a bunch of tactics because it’s a game of inches. Like, there’s not one silver bullet with this. You should be doing in-app notifications, email followups, and basically just treating those folks as their own marketing channel, because oftentimes you just need to recover them in some manner and make sure you get in front of them to continue purchasing your product. So there’s a whole host of things, and really it just comes down to treating those folks as a marketing channel, because you just need to reacquire them essentially.
On the active churn side, it really, really starts with understanding as soon as someone clicks that particular cancel button you get in front of them and you actually ask them in a very, very targeted manner, and we have a product that does basically a MaxDiff survey with some algorithms behind it, but like, “Why are you leaving? Is it because of this? Is it because of that? Why aren’t you leaving? Is it because of this? Is it because of that?” And just getting insights.
Okay, so, “We just keep getting a lot of people talking about features.” “Great. What features? What features would have kept you staying?” Right? It just gets a basic understanding of what’s happening, and then once you have that knowledge you can start chipping away at the things that aren’t working. So, “Hey, everyone’s saying they can’t get answers to support. How can we make sure that support is front and centre, that someone can actually understand exactly where they can go to get some help?” Even in that little survey funnel once they hit cancel, “Oh, would you like to talk to support, or do you still want to cancel?” Because then you might actually save those folks, or some of them. Or even if they’re like, “Hey, it’s way too expensive.” Well, give them a discount for half a month. Right? Just see, like, “Hey, can we keep you around for the long-term by reducing that energy that it takes to stick around for at least a month or something like that?”
It really comes down to just following a process, but the first part of that active churn process is just understanding why people are leaving, and then normally the answers start to basically show themselves, like, “Oh, yeah, yeah, that’s right. We still don’t have that feature. Let’s build that.” But what’s cool about the insights is that you also are able to prioritise those reasons really, really well. Because you might think, “Oh, it’s support,” and only one person just has a problem with your support and a tonne of people have a problem with with fact that you don’t have this feature or something like that.
Christie: Right. Then, is it sort of like the squeaky wheel gets the oil in terms of what you focus on there?
Patrick: Yep, exactly. Absolutely.
Patrick: Yep, exactly.
Christie: Well, part of what we want to uncover with this video series is fostering or creating a culture within your organisation to support your ideals of being customer obsessed and customer driven. Now that you have a growing team of 35, maybe more, how do you motivate and keep employees on this mission? How do you keep them aligned with the goal of being customer driven? I guess it’s important that they know the goals. Keeping customers engaged obviously is why you’re here, but it’s the folks that are driving the bus that have to also have that same motivation. How do you get them … how do you keep your employees?
Patrick: So keeping them motivated to be customer driven?
Christie: Well, I guess to be customer driven, not just to be cogs on a wheel and doing their job, but how do you help your staff actually embody the same feelings that you have on this and align for the same goal? Because everybody’s got a different job, obviously. I mean, there’s different departments I’m assuming within your organisation. Maybe not everybody is touching the customer, but everybody probably should have some kind of idea of keeping the customer in mind or, you know, there’s no point to this.
Patrick: Yeah, absolutely. It’s more around making sure that … I think that the easiest thing to do is just make it non-negotiable. Like, I think that-
Christie: “Do this, or else.”
Patrick: Well, not quite like that, but in the sense of, “Hey, we’ve got to talk to this many customers a month.” Just, that’s the deal. Right? And obviously if people are just like, “Okay, I’ll talk to them. That’s it.” Right? But that’s not the point, necessarily. But I think if you just make it like, it’s like the assumptive close, like, “No, this is just what we’re doing. This is just what we do here.” Right? I think that’s a big thing.
And I think that a long with that is you’ve got to give the tools and the time sometimes to be able to do this. Someone wrangling customer development, that might be 20% of their job. That’s a day a week. That’s not an insignificant amount of time. But that 20% can pay a lot of dividends, so you just need to make sure you’re not being penny wise and pound foolish if you’re not going to let that person take that time. Tools are really easy to implement, and also just feature aspects, like making sure that you can collect that data when someone hits the cancel button, or making sure that there is either Drift or Intercom or something in the corner so that if someone has a question or someone wants to give some feedback they can basically provide it. Then, finally, I think …
So those are kind of more mechanical things you can do. I think finally from a cultural perspective you just have to hire the right people. I think that one thing that we really, as a community, don’t look for in hires as much as we should is this concept of curiosity. I think that curiosity mixed with someone who’s persistent and someone who has just a really good analytical mind, I guess not even great or good, but just a basic analytical mind is a pretty unstoppable force, because they’re going to be curious why someone’s churning. They’re going to be curious why things happen. They’re going to be able to sit there and kind of understand, and that curiosity mixed with persistence means they’re going to get to the bottom of why that’s happening and then propose a number of solutions for whatever is happening. I think that it really just definitely starts with hiring the right people and then making sure some of the mechanical and other pieces are kind of implemented.
Christie: Cool. Okay, so here’s some lightning round type questions that I want to put out there.
Patrick: Let’s go.
Christie: Well, no it has to do with you. If you could go back in a time machine right now and back to when you first started your company and you think, “Boy, if I knew then what I know now.” What’s the one thing you would do differently and why?
Patrick: What’s funny is this is, it’s such a hard question because … I don’t know if you’ve ever heard the phrase, like, “Wisdom is learned. It can’t be taught.” I feel like there’s so many things that, like, I read so many articles about hiring before I hired people. There’s so many articles that say, “Don’t do this. Don’t do that.” It’s just consistent. Every single person that you talk to, every single old-school 20 years in tech, 30 years in tech say it. But for some reason everyone makes the same mistakes because they’re like, “No, no, no. I’m going to be different. This is going to be different. This is going to be different.”
So I guess I’m answering the question a little bit, like, maybe listen to those things that other people say, because I think that you’re … This sounds so aggressive, but you’re less of a unique person than you might think.
Christie: Than you think? Yeah.
Patrick: Yeah, that’s so aggressive.
Christie: No, that’s good.
Patrick: Yeah, but I think it’s-
Christie: I mean, did you ever just go, “What the heck am I doing? Am I crazy?”
Patrick: Yeah, like, always. I mean, I don’t know. Actually, I think-
Christie: You’re still doing it?
Patrick: I think it’s more … For me it was more just like … So yeah, I think on that element I think it was more just like, listen to some of the advice more. I think the problem is that a lot of the advice isn’t put together in the right way so you’re just like, “Well, who do I listen to? How do I not? Because there aren’t really good signals on who’s good advice and who’s not.” So maybe coming up with a framework on how to get better advice, like, surrounding myself … I think I should have surrounded myself with more-
Christie: Uh-oh. [inaudible 00:36:15].
Patrick: A different [inaudible 00:36:16]. Uh-oh.
Christie: Oh, okay, you’re back.
Patrick: Okay. Am I back?
Christie: Yeah. I don’t remember what I missed.
Patrick: That’s okay. Basically, my answer to that question is maybe a better framework on who should I get advice from and who I shouldn’t get advice from, and just having more diverse advisors and mentors and just reading a hell of a lot more just to get as much information as I can from as many sources as I can.
Christie: Well, in that were there people that you sort of looked up to or maybe other people in the industry, or not in the industry that inspired you, that kind of, you know, with you not feeling like you probably didn’t listen to the right people or got the right advice, were there maybe people out there like, I don’t know, Steve Jobs, or Elon Musk, or something like that that actually inspired you to do this? Or maybe there’s someone in your path that you encountered that inspired you to stay the course and continue? Is there anyone?
Patrick: Yeah, I mean, there are a couple of people but for different reasons. I think I never realised how much this affected me, but I met a guy by the name of Hal Varian who everyone should know. He was the chief economist … I think he’s still the chief economist at Google. He invented the original ad formula basically for how ads are served, which is obviously a pretty big deal for Google, so now it’s much more complicated. But he and Eric Schmidt would always say this, the chairman of Google, they would always say things like, “Statisticians are going to inherit the world.” Like, “Stop trying to become an MBA person, stop trying to do this, go learn statistics.” And I think that that really affected me because … It’s not that I necessarily was like, “Yes, these guys are 100% right.” I think it’s just something that stuck in my brain and pushed me to learn more about analytics, more about statistics, more about these different things.
But I think from a grit perspective I think that, and this is maybe kind of a cliché answer, but I think what’s interesting is like, I learned a lot from my parents.
Christie: Wow! That’s not cliché.
Patrick: Yeah, it’s kind of like, everyone talks about their parents, I feel. But it wasn’t because either of them … I mean, I don’t think they realised that I learned this from them, but I think what’s interesting is they’re both very blue collar, from rural Wisconsin. Both of them are very, like, “You go to work every day because that’s your job.” You know what I mean? You don’t spend all of your money because that’s your job, is to make it and secure your family. So they definitely didn’t teach me to take risks if that makes sense, because it’s a very risk-adverse type of both culture and mindset. But I think that just the concept of getting things done.
One thing about my dad specifically is that this is a guy who didn’t go to college, he’s a union tinner, sheet metal worker, and now an HVAC guy, and comes home, goes and reads, and just reads these old horrible textbooks that are probably outdated but are on valves and all these types of things. So it was just the passion for learning mixed with that grit. We went through some not so great times growing up just in terms of finances and all that kind of stuff, but yeah, it was one of those things where that, like, if I look at what actually influenced me, those are the things that influenced me moreso than kind of like a Steve Jobs archetype or anything like that.
Christie: Excellent. I like that. I like that answer, because I think you learned work ethic, you learned, like you said, the grit.
Patrick: Totally. Yeah, absolutely.
Christie: You gained strength from that. I mean, yes, very different minded, very old fashioned, very work at a job until you’re 50, which nobody does. But at the same time, there’s merit there in what you learned. Excellent. Thinking about the companies that are out there at the moment, maybe even some of them being your customers, who do you think is doing a really good job? I mean, keeping in mind that we do have some startups and entrepreneurs that are going to be audience of this programme, but maybe something for them to model themselves after. What companies are doing a really good job of being customer obsessed right now?
Patrick: That’s a tough question, because I think that some of the people that I would have … I’m not going to go too deep into this but some of the people I would have said maybe three years ago are no longer that way.
Christie: Are no longer? Oh, wow.
Christie: Okay. You’ve got to keep that a secret. Not going to put that out there.
Patrick: You can email me directly if you want to find out who those people are.
Christie: I want the 411. All right. Okay. I like it. I like it.
Patrick: But I think there’s a few because … So Atlassian is a really good one.
Christie: What do they do?
Patrick: They are, like, whenever you look at a company and you’re just like … So I would say Atlassian and Wistia for the same reason. You look at those types of companies and you’re like, “Okay, it seems like everything’s effortless. It seems like they just get everything right.” Like, it’s just like, “Oh, okay. They just pushed that feature and it took off, or they just did that thing.” I don’t think what you realise, and I know a bit about both of these companies from the outside and a little bit from the inside, but both of them are very, very … Like, one, they do fail a lot more than you see, but two, the also are very, very methodical about their users and things like that. I think that that’s kind of created that nice customer obsession.
There’s another company actually that’s called Ansarada. It’s out of Sydney, Australia. It was one of those companies where the customer obsession, I don’t know if they would necessarily say, like, “Oh, they’re customer obsessed.” That’s not the one thing that I would say. But the culture, and even just the office space and just how they run the company, and their values and just how everything’s aligned is … there’s no way that that company can’t be customer obsessed even though it’s not like you walk in and you see every single profile of a customer and things like that. It’s just, everything’s so aligned perfectly. So I’d learn a lot from them if you can.
Then, one kind of … No, I’m going to stick with those three. I think those three are actually.
Christie: You’re going to stick with those three?
Patrick: Yeah, yeah. I think those three.
Christie: One piece of final advice for those folks out there that are watching this on how to be more in tune to their customer; listening to them, getting feedback from them, any other piece of advice?
Patrick: Yeah. Honestly, I think the easiest thing you can do is just put a number on the board. Like, “We’re going to talk to this many people this month in a non-sales capacity.” That seems to be the easiest thing. Like, if you’re already doing a bunch of customer development, great. There’s so many optimizations I probably could mention or help with, and they might be applicable or not applicable, but I think the biggest thing if you’re just starting off or if you’re a big company and you’re just not doing this, is put a number on the board. And keep it small, like 5, 10, just 10 people in a non-sales capacity that you’re talking to about the product, and then obviously grow that number from there.
Christie: You know what? That actually makes me think about, there’s a guy that … It’s a, I guess a company I have a subscription with or something like that, and he will send an email. Now that I’m hearing you say this I’m thinking about this, and this is probably part of his motivation. He will send an email just like, “Hey, how are you doing? No, seriously. Reply. Hit reply and tell me how you’re doing.” And I’m thinking, it’s like … It’s a writing thing, sort of like a writing newsletter or something that I’m in. So he’s like, “So what are you working on?” And I mean, of course, I know this business so yeah, I’m pretty sure he did it in MailChimp or something like that and it’s going out to his entire list, but it’s very personal in that he’s like, “Hey, I’m really interested in what you’re working on. Are you having any struggles? Is there anything I can help with?” And doesn’t make it seem all salesy or anything. And then in parenthesis like, “No, I’m serious. Hit reply and tell me how you’re doing.”
So the marketing head in me is like tactic. Then, the customer [inaudible 00:45:17] is going, “I’m going to hit reply and see if it really works.” And I did one time, and we actually ended up having a back and forth email conversation, it wasn’t a bot, it wasn’t some customer service. I mean, it’s just this guy. Well, I mean, I’m pretty sure he has staff, but he literally was having a conversation with me and I felt like, “Well, I didn’t really think that was going to work because I can only imagine how big his email list is.” I wonder if he actually thought about how many people are actually going to hit reply.
And listening to that, what do you think? Listening to something like that, he has like a writer’s group or whatever, massive … Let’s just throw out a number. Let’s say he has 100,000 subscribers. Just off the top of your head knowing that, and he just said, “Hey, I just want to know how you’re doing, what you’re working on. Is there anything that I can maybe help you with? Hit reply.” How many people do you think actually went, “Let me go pour my heart out to this guy.”?
Patrick: Do you know? Or [crosstalk 00:46:21].
Christie: I have no idea. I’m just saying. I mean, that’s what I think about, like, “Really, how many people actually hit reply?”
Patrick: Yeah, there’s probably a really, really good number of people who have done that. I mean, it’s one of those things where getting … I think there’s a whole other topic we could talk about which is just being human. I think that this is what I’m trying to teach a lot of some of our really, really good but more entry-level writer team members, because they never teach you to be human in emails anymore.
Christie: Yeah, they don’t. No. And I think that’s important.
Patrick: I would argue that there’s probably a lot of people who do reply, and he or she probably has some sort of a system that, you know, some of those folks they just reply to. We have something similar. It’s not quite that open, but we have something similar and people reply and it goes right to my inbox. Some weeks there’s a tonne of them, but other weeks it’s just like, “Hey, I’m doing really, really well.” And it’s like, “Oh, that’s awesome. Sounds great.” It doesn’t have to be something really extensive, but there’s some good opportunities that come out of that. So yeah, I mean, that just shows how easy it is to basically open up someone in terms of getting [crosstalk 00:47:39]-
Christie: And it might have even been a tactic to just find out how many people are actually reading his emails.
Patrick: That’s true too. Yeah, yeah. [crossstalk 00:47:46].
Christie: That could have just been a really clever way to test. So there’s a nugget for everybody. Try that.
Patrick: Yeah, yeah. Absolutely.
Christie: Try that. Well, this has been a great conversation Patrick. I really appreciate you for being here.
Patrick: Yeah, yeah.
Christie: This is so awesome. So if you’d like to learn more about Price Intelligently and ProfitWell you can go to PriceIntelligently.com and, I believe, ProfitWell.com. Is that correct for both of those?
Christie: And where else can they find you online and chat you up some?
Patrick: Yeah, just, it’s Patrick@PriceIntelligently.com. Then, if you’re … Yeah, I mean, I’m Paticus on Twitter. That’s a whole other childhood nickname story, but yeah, it’s pretty easy to get a hold of me.
Christie: Yeah, okay. Maybe I’ll have to ask that question offline. “Paticus”, interesting.
Patrick: No way. Yeah, yeah, yeah.
Christie: Well, thank you very much for sharing your insight with us today. I mean, I have learned a tonne, and I’m pretty sure everyone else watching has too. Once again, this is Christie with Fieldboom, and thank you for watching. We’ll see you next time.