Zendesk is no longer a startup; in fact, we haven’t been in some time. Even so, 2018 marks the 10-year anniversary of our founding. As part of that, we want to give a nod back to our roots. Over the next few months we’ll share some of the best content about how this journey began, and a few lessons we’ve learned along the way.
A new year is always filled with new plans. We often break these grand plans and then feel crappy about ourselves. And maybe sometimes we should. You should quit smoking…and be less stressed…and volunteer. But other times, sticking to a predetermined plan isn’t really possible—and possibly even dumb.
At least that’s the case when the plan we are talking about is a business plan. There’s so much focus on these documents. Business schools offer entire courses dedicated to them. A section on the Small Business Administration’s current website recommends, “A business plan is an essential roadmap for business success.”
Yikes. We did not have one of these “essential roadmaps” when we started Zendesk. We didn’t think much about crafting one and the truth is I wouldn’t have even known what to write. We were focused on building the product and making it lean and elegant. We never thought about a target market. We never thought about competition. All we thought about was trying a different approach to existing customer service software. Our only plan was: “Just make customers happy.” It would have been a one-line plan.
We never thought about a target market. We never thought about competition. All we thought about was trying a different approach to existing customer service software. Our only plan was: "Just make customers happy."
Of course later, when we were raising money, we needed some kind of plan that put the investment into perspective. Now, when I dig up and re-read some of these “plans” we wrote back then, it’s funny to see how wrong we were and how little we knew. The concept of organic viral adoption via word of mouth has been so critical to our growth, but it’s never mentioned in any of those early documents. We had no idea. And I don’t think we—or anybody else, for that matter—considered it a viable business practice. Of course our financial projections and market sizing were way off as well.
But in other areas, we were right, and we now see that our gut intuition about the market was spot on. In an early document, we described the typical problems our target market had and how they described them:
1. “We have five billion different channels for reporting bugs and feature requests and for asking us questions. We must consolidate all of this!”
2. “We are a new start-up battered by success and support requests. We need a support system up and running today rather than tomorrow!”
3. “Our customers are fed up with our old school support system. They just want to send us a simple email and receive a simple answer. They don’t want to fill out a questionnaire!”
And although you can argue that these statements are relatively superficial and not describing true customer experience issues that Zendesk also solves, overall, these statements still describe the situation for a big portion of our prospects. In the same document we also described our competitive differentiation as “Zendesk differs from all of these players by combining a professional grade feature set with a superior user interface and a hassle-free, competitively priced SaaS model.” Stiv pik og håret tilbage as we say in Danish (NSFW).
One of the more interesting early “roadmaps” was called “100 Days, 1,000 Customers.” This was written in mid-January 2008, exactly 100 days after we launched, and was later published on our blog. I’m not exactly sure whom we wrote this document for, but it reveals how much we learned in a short time and how profound our intuition was for the market and the industry. If you read the post in its entirety, you’ll notice that the we use the term “customers” for all trial and freemium customers, and not necessarily paying customers, as we do today. But I really wanna emphasize this section:
Our first 100 days has also taught us something about the support industry 2.0. Whereas the traditional help desk has always been control-oriented in its nature, the new support paradigm carries a much more fragmented and loosely coupled approach to the customer relationship. An old-fashioned help desk sees itself as the single point of contact, with all the restraints, promises and obligations such a perception produces. Today it’s clear for everybody that we as support consumers, as IT end-users, as technology customers, have numerous support sources thanks to the Internet. As the consumerization of technology gains ground, the role of the help desk is changing. The help desk is just one of many sources for getting support, and is now more than ever someone working in symbiosis with the customer and the rest of world.
It’s a little dense, yeah, but I think ultimately this is an early sign of the humility that has characterized our product design and go-to-market strategy and that is also characterizing a new generation of enterprise software companies. The Internet is our platform, and the consumer is boss.
The Internet is our platform, and the consumer is boss.
And in many ways, it was the consumer who helped us devise the real plan. Customers pretty instantly showed us that they liked the software once we made it available and they also gave us a lot of feedback on how to improve it. For example, in the very first version we released, customers had to be registered already before they received service. But, we soon discovered that was not how customer relationships worked for websites and web apps. Oftentimes, there wasn’t any kind of established or existing business relationship at the time someone contacted customer support. We realized that instead of having a pre-registered user, we had to create the user in the system at the first point of contact. Although it sounds like a pretty basic thing, it was a big distinction and it would completely turn the traditional experience with customer support upside down. We never would have planned for that.
I am comforted that we’re not the only ones who forwent the traditional startup business plan. According to research by Anthony K. Tjan, 70 percent of the entrepreneurs surveyed who had a successful exit (IPO or sale to another firm) did NOT start with a business plan. Another author, Paul B. Brown, planned to write a book that included the original business plans of successful entrepreneurs. That concept ran into a problem though when he found the business plans he collected had nothing to do with what the businesses eventually became. He scrapped the book idea.
Ours might have made that slush pile too, but it turns out there was one plan we had—our simple idea to “just make customers happy,” which stayed the same. That’s still our plan—and, that’s a resolution I know we can keep.
Mikkel Svane is the CEO, chairman, and founder of Zendesk, a global company that builds software for better customer relationships. He has driven the vision, culture, and growth of the company for the last 10 years. Under his leadership, the company went public on the New York Stock Exchange in 2014 and currently helps more than 100,000 organizations around the world better help, engage with, and understand their customers. Originally from Copenhagen, Denmark, he is a published author of the book Startupland, a father of three, and a lover of handcrafted cocktails.