I started 2017 with a lot of uncertainty about our future. We had coffers full of gold since Fall 2016, when we acquired funds from Polish and US investors. It would seem that there was no reason to worry.
For the first time in a long while, we had the means to invest in growth with full force. It was thanks to aggressive investments at the end of 2016 that we were able to achieve over 900% increase in MRR that we boasted in last year’s review.
The threat of running out of money was becoming all too real
Everything looked fine on the surface, but I couldn’t stop myself from worrying. We still didn’t have scalable sales channels. Despite testing various methods, sales to our target group – people who create websites professionally – were slow as molasses. The amount of money we spent on acquiring a new client exceeded how much we planned on profiting from him over the course of the entire contract. Other potential groups, like large agencies or enterprises, weren’t sending us any clear signals either.
It became clear to us by the end of March that continuing our prevailing strategy would get us nowhere. Growth rate decelerated to below 10% per month, which was an utterly unacceptable outcome at the stage we were at. There was just not enough money to acquire enough clients and gain their trust. On top of it all, we were still spending many times more than we were earning. The threat of running out of money was becoming all too real.
We practically reinvented Perfect Dashboard from scratch
We scrambled to look for a solution. Our fundamental problem was that our clients turned out far more conservative than we expected. “Do nothing” became our primary competition. Eventually, we realized that our every potential client was already a client of somebody else – a hosting company. In the end, every web page is provided by some host.
We have been observing this market for some time and we noticed that hosting companies were increasingly threatened by Facebook, Wix and other platforms which take on the workload of maintaining a site after publishing. Hosts were desperately searching for ways to innovate and reverse decay into growth. We had the technology to help them.
It was time to regroup
Together with our team and investors, we changed the way we acquired our clients. Instead of online mass marketing aimed at freelancers, we threw together a traditional sales team. The product also had to change, as we were now focusing on a completely different customer profile. Half of the team were diverted to new tasks nearly overnight. We practically reinvented Perfect Dashboard from scratch.
After adjusting the budget it became clear, that we have until the 30th of September to prove to ourselves and the VC market that we’re still the hottest web startup out there. We’ve buckled down trying to acquire our first hosting company while simultaneously developing an API for them. Time was running out. Our financial situation was becoming direr by the month.
The day when we finally caught wind in our mental sails
I still remember the day when Bartek, Perfect Dashboard co-founder and CSO, delivered our first signed contract. On one hand, we rejoiced at the success, but on the other, we didn’t want to count our chickens before they’re hatched. But they eventually did. The next contract quickly followed and we finally caught wind in our mental sails.
Despite our dwindling finances we decided to make it or break it. We hired our first US-based employee and for the first time, we started intensively acquiring clients from both sides of the ocean. Airplanes became a second home to me. In 2017 I had over 150 flights and spent more time on delegations than at my house.
Our investors were pleased with the progress we’ve made
It paid off. During our yearly board meeting, our investors told us that they were pleased with the progress we’ve made. One of our Silicon Valley investors, Ken Singer, who is the Managing Director of the Center for Entrepreneurship and Technology at UC Berkeley, praised us for recognizing the threat ahead of time and finding and implementing a solution. “I’ve mentored hundreds of startups, and rarely did any of them achieve such a feat,” he said.
Our investors also rose to the challenge. On that same meeting they agreed to invest further in the company, so we could accelerate sales scaling. They encouraged us to open another investment round at the break of 2017/2018.
Everything is finally starting to look up
The European Commission recognized us with the Seal of Excellence. It is a distinction which was awarded to only a couple dozen entities. NCBiR (National Centre for Research and Development) granted us nearly 2 million euro in subsidies for the purpose of long-term product development. And finally, we have welcomed Steve Adelman, chair of Silicon Valley’s Wharton Angels, among our investors.
This summary is being written on my way to our Chicago office, where I am to sign another contract. If we keep up the pace then we should be able to boast over 50 hosting industry clients and 1 million euro of sales at the 2018 review.