Davis Baer: What’s your background, and what are you working on?Kurt Schrader: At Clubhouse we’re building project management tools that are built for today’s software development team. We are focused on creating healthier collaboration across organizations so teams can focus on creating products their customers love. Today, over 1,500 companies are using Clubhouse, with over 3,000,000 Stories being created on our platform since our launch in 2016.
Before Clubhouse, I was the CTO of Intent Media, an ad tech company, where I grew the engineering team from 1 (i.e. me) to over 40 people. Intent is where I met my co-founder Andrew.
All-in-all, I have been building and running engineering teams for over 20 years, from Fortune 500s to small startups.
What motivated you to get started with your company?When we thought of Clubhouse, Andrew and I were both working at Intent Media, a 150 person company. A problem experienced by the engineering team was something I had seen time and time again at other companies: people fighting with their tools instead of their tools working for them. It felt like it was time to try and do something better and create something that people actually enjoy using, and does the job it’s supposed to do in helping teams work more efficiently.
What went into building the initial product?Andrew and I spent 8 months building the initial version of the product. To build it, we chose Clojure and Datomic on the backend, with a custom-built JS framework on the front end, built by Andrew.
Because we were building a project management tool, we were aiming to build something that we could use to help us build the product itself, then focused on building something with a broad enough feature set that allowed smaller (10–30 person) companies could get up and running with the tool. Once we were happy with what we had, we got 2 companies using it before we went out to raise funds.
During this time we subsisted on our savings until an Angel round of money came in, which came through once we had a few companies up and running on the platform. So, technically, Clubhouse was our full-time job, even though we weren’t paying ourselves at the time.
How have you attracted users and grown your company?I showed the product to a couple of people I knew and worked with them to shape the product to help meet their needs. The idea was that they would become our happy first few customers. From there we worked with our investors to identify good companies in their portfolio who could use the tool and grew our customer base that way.
From a marketing perspective, we used sites like Hacker News and Product Hunt to publicize the product and new feature releases, taking the time to interact with people on these sites. We also spent a fair amount of time on product-focused Slack channel, interacting with people there and talking up the product. Additionally, we would watch for mentions of our competitors on Twitter and respond to opportunities where we could promote our product as an alternative.
A lesson from all of this is that it was kind of a crapshoot. Sometimes we’d post something on a forum and it would end up with zero traction. Other days we’d get thousands. So, you can have big plans but they won’t always work out. Sometimes these things will work and send a burst of traffic, sometimes they won’t. Don’t get discouraged if it doesn’t work out; don’t be afraid to go back to the well.
What’s your business model, and how have you grown your revenue?We make money through subscription to our product. This is mainly on a per user, per month basis, or through our Small Team plan which is a flat rate we charge to teams of 10 or less. We also offer discounts to teams who pay annually.
We were in beta for nine months and had 30 or 40 customers when we started charging money. There came a point where we decided to finally charge people and so we said: “hey, next month we’re going to charge for this”. And people did it; we had zero churn.
Since then, our revenue has expanded rapidly because we price super aggressively for smaller teams. We get them on board and impress them with the product, and then have those teams expand. As a result of this strategy, we’re very open to extending trials if people need more time to make a decision.
What are your goals for the future?Our goal for Clubhouse is for it to be the default tool people choose for helping software teams to manage their work. We plan to accomplish that by continuing to build the things that people need to run software teams, as well as building additional tools that teams need in order to be more efficient and productive.
There are many tools that exist out there that people are already using. So we have to show and prove ourselves. We have to be clear in how we have to show our value to people and justify the cost of switching.
What are the biggest challenges you’ve faced and obstacles you’ve overcome? If you had to start over, what would you do differently?When I was younger, one thing I used to sometimes over index towards was ‘this person seems really smart and they’re going to be really good at writing code but they seem kind of like a jerk. But maybe we’ll just ignore that because they’re going to be really good for us in building stuff’.
I’ve learned over the course of my career that I never look back at those people and, long term, thought that it was a good idea. Something I’ve learned over time is to optimize for good people and people that fit with the values of your company.
In hindsight, I’ve also realized that, in previous teams, decision making was too centralized at a high level. I’ve tried to do a better job in pushing that out to the edge and trusting the team more.
But if I had to start over, what would I do differently? Nothing.
Have you found anything particularly helpful or advantageous?I find it really useful to talk to other people that have started or founded companies. Fundamentally no one really knows what they’re doing when they start a company. So talking to people about the mistakes they make is helpful — any time you can get some advice grounded in real examples, it tends to be pretty useful.
But there’s always so much luck involved with this stuff, it’s kind of hard to determine what part is helpful, exactly. For example, someone happened to write a blog post about Clubhouse and it helped us get customers. So, be aware of luck and do what you can, but you can’t rely on or plan for things like that.
What’s your advice for entrepreneurs who are just starting out?Three things:
● Delegate. Founders want to keep their hands in things for way too long. The faster you can hand off your responsibilities — to someone who is better than it than you — will be better for your company. Be it marketing, finances or engineering, pushing things forward there will lead to a better company.
● Stay focussed on 2 or 3 most important things for the company. Or you will get pulled in a hundred different directions.
● Help people out as much as possible, without expecting anything back from them. If they aren’t large asks of your time, just do it and it will come back or help in ways that you can’t have predicted. Basically, be nice to people.