2012 was the single most difficult year for HasOffers. It was also the most exciting and rewarding one.
From launching a new product, to massive scaling and big data, to doubling in size and in revenue, we experienced just about every growing pain a startup can encounter. I’m most excited because we made it through and we’re on our way to leaving startupdom and growing into a new phase as a mature company.
I thought I’d take a minute to reflect on some of our challenges this year in hopes that they’ll somehow strike a chord with your own company or startup vision. I figure we all have something we can learn from each other along the way, so please leave your comments, advice, encouragement, or insight.
Here are some questions that have kept us up at night, and our plans for making them work in the New Year…
To continue to bootstrap or not to bootstrap? Bootstrapping for now it is.
We’ve seen a number of term sheets from investors this year, and we’ve kept our minds open to the possibility of the right partnership, but it hasn’t been easy. When you have a product with four years of historical revenue and a new disruptive platform entering the hype of mobile, you find yourself wedged between two camps.
There are those investors who are interested in scaling our flagship product and those that love the shiny object of the new product. The problem for us is that we see our products as two sides of the same coin. Tracking campaigns for mobile apps is not all that drastically different from tracking performance campaigns on desktop browsers. Sure there are some key identifiers and methods that are different, but it doesn’t change what we fundamentally do.
We are looking to solve for the elephant in the room — advertising attribution for performance marketers — and we are leading the way, so why not continue on our own terms for now?
We continue to bootstrap because it is an option. We grew by another 100% in revenue this year, scaling our team as we go, and we’re able to have the steady growth we need to keep up with client demand so far.
It isn’t always easy but I believe in the long run it is making us more agile and resourceful. I tip my hat to co-founders Lucas and Lee for staying strong this long, and I truly believe it has already paid off substantially.
How do we grow while remaining true to ourselves? Slowly, with intention and awareness.
This year we’ve expanded to over 50 employees. I won’t lie and say that moving from 23 employees to 57 was easy. Far from it actually. That is fast growth even for a company with a seasoned board of directors and VC money in the bank, but I’m extremely proud of what we’ve been able to accomplish.
We have a team that truly cares about our mission here. We get shit done, every single day, and it’s inspiring to reflect on what we accomplished in 2012. Like any team we still have a long way to go in developing great process and redundancy, but I believe we’re well on our way.
We’ve intentionally continued to be a pretty flat organization, but what I consider to be a healthy one. We don’t have a huge amount of bickering about focus and vision because we have extremely active and knowledgeable founders when it comes to product, and for that I am very thankful.
How the hell do we continue to grow at this scale while remaining stable? With a lot of hard work and late nights, that’s how.
Our revenue and headcount are not the only things that grew dramatically this year. We have more than tripled in the volume of requests to our servers. To that end we have developed a team that fully supports our needs for big data, finding the latest technologies and improvements we can make. It is very clear that this will be core to our success as a company.
Nearing the end of 2012 we encountered some problems with our tracking servers. There were several hours of latency and even some short outages that impacted our clients. Up until this point we had an extremely clear record for the rest of the year, which is why this lack of service came as such a devastation. Not only did we let our clients down, but we let our own teams down as we entered into the Holiday season where people are trying to take time off and be with their families.
This was certainly a very difficult experience for some of our engineers as the entire world seemed to rest on their shoulders to provide a speedy recovery, and I’m very happy to say that they did succeed. The aftermath has been a compilation of exhaustive post mortem reports, new strategies to eliminate any similar vulnerabilities in the future, and a much higher AWS bill.
I am pleased with the way our teams solved these problems, from support responses to our clients, to the collaboration of engineers, and at the end of the day I’ve come to realize that this is one of the unfortunate realities of technology, and especially technology as a service. When Comcast goes down and our office grinds to a halt, there is not too much we can do but hope they are working toward a fast resolution as we hemorrhage thousands of dollars.
How can we improve our cash flow? Look inside rather than outside for the biggest wins.
We have always plowed our earnings back into the company, nearly 100%. We are profitable, but we believe the best investment of that profit is the growth of HasOffers. So as the number of team members continues to rise and our IT resources increase, managing cash flow is key to our business strategy.
One interesting way we improved our cash flow this year was by making purchases of reserved instances on Amazon. One of our engineers pointed out that purchasing these instances a year in advance gives us massive savings (up to 65%), and so we began thinking of ways we might support such a lump sum expense without massively hitting our books. From there, Crystal, our VP of Finance researched several loans and found that American Express will actually give loans as an advance on the the amount of money you book with American Express. For a nominal fee we were able to get a loan to more than cover the Amazon instances, and the best part? The loan is basically paid off several times over from the savings we have on reserved instances. This was one creative way to produce additional monthly cash flow at no real cost to us. Pretty cool.
When is the right time to go international? When the opportunity arises, jump in.
In 2012 we opened our first international office in Tel Aviv, Israel. When asked why Israel was our first choice we often answer, “because we found the right guy.” It really is true, Aryeh Altshul has been an awesome addition to the team, bringing on Shlomit and Shlomo who handle technical support for hours that we did not previously support. The team has been a huge asset to HasOffers, and believe it or not, I’m proud to announce that the office is already profitable, due to the efforts of Aryeh’s sales and business development.
This is an incredible accomplishment for us and we look forward to expanding that office with great people. My advice to any company opening their first office abroad: Find the right person for the job. Someone local but that really connects with your team at home and hopefully already has some stake in your industry.
Should we expand into new opportunities as we grow our core product? Hell yes.
Launching MobileAppTracking in November of 2011, we really had no idea what we were getting into. I have to hand it to Lucas who saw huge potential in the market and pushed to get a product to market quickly. We were literally one of the first on the scene with a viable tracking method for mobile app marketing, and we quickly thrust into a new world of clients and advertisers. Mobile apps are increasing rapidly in number, the competition grows by the day, and marketers need a powerful way to track their performance campaigns.
I’m excited to say that we have become the number one choice for many of the worlds largest and smartest mobile app studios. We owe much of that progress to Micah Gantman, our Director of Mobile Business who picked up and moved to San Francisco for us to develop new clients and partners in the Bay Area. He has done an amazing job establishing a presence for HasOffers and helping to begin our San Francisco office in RocketSpace. 2012 was a year for gaining ground, reputation, and scalability in mobile, and this year will be a time for features and product refinement, all working toward the vision of unbiased advertising attribution across devices.
To sum it up. This year has been hard. And rewarding. And one hell of a wild ride. The team is stronger than ever and we believe we have something truly disruptive to offer a market that is waiting on us. So cheers to 2012, and heres to 2013…we can’t wait to see what it brings.