SaaS companies are conspicuous consumers of SaaS services themselves; no great surprise since who better would know the value of the model? And it would seem logical to believe that one SaaS company selling to another would have natural advantages closing sales. That’s sometimes the case, but we’ve also researched many instances where SaaS firms have had their ears pinned back during the sales cycle. We wanted to know more, and reached out to SaaS firm, Brisk. The company’s a recent startup with its corporate HQ in Sweden, a country not often associated in the U.S. public mind with high-tech startups.
It may be cold in Sweden much of the year, but the company’s customer list is hot, with major and high profile customers such as HootSuite and Evernote. We sat down with Brisk company president and co-founder Hampus Jakobbson to find out more about how they’ve succeeded in building the company’s impressive customer list, as well as such issues as customer benchmarking, the VC scene in Sweden, and the future of selling SaaS.
Company: Brisk (https://www.brisk.io)
Company HQ: Malmö, Sweden
Company Principals: Hampus Jakobbson
Founded/Years in Business: Founded August, 2012
Company Development Type: Venture funded. (While France and Germany are not strong: there are an enormous number of startups, lots of startups, have done seed deals, on par with Israel.
Number of Employees: 13
% of Revenue Growth Over Last Years: Last year 25% growth on average month to month.
Notable Customers: Hootsuite, Evernote, Intercomm, Zendesk, TrustPilot.
Peter, tell us more about your software. CRM is a very crowded segment, dominated by two giants, Salesforce com and NetSuite. How do you compete?
Well, first I need to point out that we use Salesforce; the customer must have it installed to use Brisk. When we first released the product we also supported SurgarCRM and Microsoft Dynamics, but we pulled back to focus on one platform during our launch period. We’re going to support other systems moving forward, but right now it’s only Salesforce.
When I say we use Salesforce.com, I mean Brisk integrates into their backend, the Salesforce data stores. Brisk does not store any customer data. One of the things we’ve discovered is that customers are reluctant to allow ever increasing numbers of SaaS vendors to manage and access their data. Every additional SaaS data silo that is created represents another potential security risk.
How does Brisk work and what does it do?
On the front end, we aggregate and replace the front end of a large number of sales and marketing tools, including ToTango, Pardot, Marketo, Google, etc., in addition to sitting on top of the Salesforce contact management system. You can think of Brisk as the “one interface to rule them all.” Within the Brisk environment, all the data streams are integrated into a central “dashboard.” The subscriber can access the underlying SaaS system, such as Salesforce, and use it directly, but after a couple of times they stop doing that and do their work in Brisk. It’s much more efficient. That’s because Brisk was built around the belief that sales people love politics and dating.
That’s an interesting statement. Can you be more specific?
Yes. Today, a sales force may be juggling multiple tools. Internally, we call this the “sales stack.” Here’s a representative stack—they’re all tools we’ve seen in use by our customers:
- Field Trip
- Conga Composer
- Data Quality Analysis Dashboards
- Salesforce for Twitter and Facebook
- Milestones PM
- Rollup Helper
As one salesperson told us, in such an environment “my life consists of 500 tabs.” Humans aren’t made for managing this type of thing. Many CSOs tell us they spend 50% of their time discussing what they don’t know, rather than what they do, about their accounts.
This brings me back to politics and dating. A sales rep likes discussing the obstacles to closing a sale (politics) and persuading their potential customers to buy (dating). A new phrase we’ve seen entering the sales and marketing lexicon is “sales engineer,” but we’ve found sales people don’t want to be “engineers.” CRM and sales tool administrative maintenance chores are regarded as selling obstacles.
Every quarter, a sales manager has to provide pipeline and sales projections. Every sales person receives orders before the big quarterly meeting to provide key stats such as pipeline figures, projected close dates, convert to sales number and so on. Every sales person asks their management if they want them to focus on filling out fields in their CRM or closing business. Every sales manager says “go close business” and the cycle continues.
What’s your business model? How do you monetize Brisk?
We use the freemium model. One of the advantages of using the Salesforce backend is it pre-qualifies people before they install Brisk. The product is free and there’s no limitation on the number of subscribers who can use the product. The system comes with a series of pre-configured templates that enables people to use Brisk off the shelf, but over time, companies find they want to configure the product to match their specific processes and workflows. Brisk enables you to incorporate very specific process flows into the product and we charge for that capability.
In SaaS Entrepreneur we discuss how SaaS firms can benefit from network effect data. Given the fact that you’re aggregating data from multiple sources in Brisk, has the company been able to leverage the information you’re receiving to support your business?
Very much so. This ties back to our underlying revenue model. In many cases, our customers are young companies who are learning about their customers and business. We’re often asked to provide them with assistance on configuring Brisk in a “best practices for my company” mode. Because we’re constantly learning from our subscribers, we can often provide that capability and the product’s flexibility helps them measure best practices. Let me provide a specific example. One of our customers configured Brisk to enable a sales rep to:
- Obtain a contact phone number.
- Visit LinkedIn.
- Call the number. In most cases, no one answers.
- Leave a voice mail.
- Send an email after leaving the voice mail.
This was in contrast to the previous practice of sending a blind email.
The difference in response rates was 20% if the first process was followed. The customer was able to validate these numbers by using Brisk’s internal analysis tools. We then document this process and others like it for future subscribers when they decide to buy our configuration services.
Your PR release announcing your deal with Hootsuite mentions specific benchmarks. It states “Hootsuite’s lead generation team has created 17 percent more leads and contacts and updated 34 percent more leads. Cumulatively, Brisk users at Hootsuite now open the tool approximately 160 times a day and complete 63 percent more tasks while using the software.” Those are very precise numbers. How did you obtain them?
We obtained them from the company. When we implement Brisk for a customer, we ask them to time trial our software via a script we integrate into the system. The script reports out on how many leads are generated, updates they touched pre and post Brisk, keystrokes generated, etc. Some of our customers also like to use RescueTime, a very popular time management app to measure our performance. In addition, Brisk uses Mix Panel to track product usage.
What’s your conversion rate from free to paid?
Let’s discuss how you sell Brisk to other SaaS companies. We’ve talked with several companies who’ve told us their toughest sales were to other SaaS firms.
That’s not our experience. But I think I can provide some insight into the problem. When you’re selling technology to a technology firm, don’t bring an attitude that the customer believes “software is magic” to the sales effort. Your potential client knows your killer algorithm that enables you to offer feature X, Y, and Z costs you almost nothing once you’ve amortized development costs and won’t be willing to let you value it at $50K with a 20% markup.
I’m an engineer. I enjoy selling to informed buyers. It’s bliss for me. Swedes tend to be very honest in sales. By contrast, we find selling to people who don’t understand technology much harder.
Let’s discuss the future of selling SaaS. As a CRM company, you’re in a position to track trends and developments in the industry.
We see some very significant changes taking place. The rapid shift from “demand generation” to “demand education” is accelerating. The idea that you’re going to lure someone to a website and expect they’ll hit a “demo” button that requires someone to first talk to a sales person is becoming obsolete. People are educating themselves about your products, price points, who’s using it, and so on. It’s not just in software. Most people who buy a TV never see the unit till it’s delivered. In home purchasing in the U.S., you now visit a home twice before beginning the bidding process; in Sweden, the average is once.
Another change we see coming to the industry is greatly increased resistance to outbound emailing campaigns. Today, smart software systems can harvest with approximately a 60% chance of success your email address off the Internet via social systems, heuristics, site scraping, etc.
In response, filtering systems, driven by AI technology, will make increasing strides towards blocking unsolicited email. The email systems will become better at working around the filters. I’m head of our local AI interest group in Malmo and am tracking this ongoing virtual struggle.
That’s an interesting prediction. In the 90s, we read a Sci-Fi novel called Permutation City that predicted exactly that sort of ongoing marketing battle in the future, only the email systems deployed 3D avatars a la Second Life. There was one funny scene in which two avatars are probing each other to discover which one is the AI.
One answer to the problem is you need to learn to align your marketing to your customer’s expectations. For example, in the case of HootSuite, they started with one person using Brisk, then 10, then 40 users. At each inflection point, we sent them emails asking the company if they wanted to know more about the product. No response. We decided to call. No response. Finally, it hit us. They’re Hootsuite; tweet them. We did and they replied immediately. We demoed the product for them and two months later they bought licenses.
We find it very interesting that Brisk is located in Sweden. Europe is not known for its venture resources and networks.
That’s true for much of the EU but not Sweden. Sweden attracts a great deal of private venture. I believe we rank just behind the U.S. in terms of startups on a per capita basis. I believe it’s the national culture. We’re on par with Israel, another smaller country that punches well above its weight in high tech. Despite its socialist reputation, Sweden is very entrepreneurial and there are many startups.
Do you find it an advantage or disadvantage having your company headquartered in Stockholm?
A disadvantage in terms of sales in the U.S. That’s why we’ve recently opened up a North American office in Toronto. There are regional, linguistic, and temporal obstacles for any company doing business in Europe that wishes to compete in the U.S. One interesting cultural difference we’ve found is that from the Swedish point of view, the East Coast of the U.S. tends to differ from the West. For example, if a potential customer from New York says he likes our product, he probably means it. In the case of a Californian, they may just be trying to be polite. Swedes and New Yorkers, temperamentally, tend to have much in common.