Tough start to March

The beginning of March has been tough. For the first time since launching Herodesk, we saw two weeks in a row with no new paying customers, but we also had some customers churn.

The net effect is obvious: Our MRR dropped ~5 %.

Coming out of 15 months of net MRR growth week-over-week, I gotta admit that those two weeks got me thinking: What the hell is going on?

I know what you're thinking: "Relax dude, it's only two weeks".

You can't conclude anything based on such a short time, but as the founder, such a short time is more than enough to start thinking about all sorts of things.

So, here's what happened:

• The number of new free trials was just slightly less than usual. So that was fine.
• No new upgrades to a paid subscription. Yaiks!
• There were almost no expansion MRRs either (meaning existing customers either upgraded from Basic to Plus or added more users). Yaiks x2!!
• We had four customers churn during those two weeks for the first time. Yaiks x3 !!!

After my heart rate settled and I got my upcoming panic attack under control, I did some digging into the numbers.

• Two of the customers were a bad fit from the start.
• One didn't actually mean to upgrade, so they downgraded again.
• The last one chose an alternative solution.

We try to qualify all new customers, either manually during sales calls or automatically during our in-app onboarding, but we don't always succeed. It is what it is.

The one that hurts is the customer that choose an alternative solution.

They wanted a solution that has a built-in fully autonomous AI chatbot.

That tells me two things:

1) Although we're not there yet, we're on the right track with our product roadmap.

2) Regardless of how tempting it is to throw something together and "get it out there" quickly, we must stay true to our core beliefs on product development and customer service. This means we'd rather release things a bit slower but ensure they're top quality.

Customer service is about making it easy for the customer.

A shitty chatbot that can't answer anything correctly isn't helpful to anyone. If anything, it annoys and makes the customers angry.

All of this is a week ago or so now, and I can already see the tides changing, signups reappearing, MRR is above "pre-panic-attack levels" and things are "looking normal" again (whatever that means).

So, while it was tough, it was probably more mentally tough for me as the founder than for the business.

It's part of founder life. Even though Herodesk is my third startup, and you'd think I've learned that lesson by now, I guess it's just one of those things and feelings that stick.

I chose to take that as a good thing- it means I care.