At some point between startup and market domination, there's a wild and wooly ride coming for successful SaaS companies. Once you get past David Skok's "cash flow trough," that scary place before your company reaches break-even territory, it's time to put the peddle to the metal. Why? Because rapid growth is the name of the game. You must capture market share quickly or die trying, bearing in mind you must also continuously reduce customer acquisition costs, reduce churn and maximize customer lifetime value. Whew! Yeah, a lot of companies die trying, but some flourish. My favorite example? HubSpot.
Disclaimer: We're a card-carrying HubSpot Partner, and damn proud of it.
Unless you've been living under a rock in the marketing strategy/technology space, you probably know the HubSpot story. Founded by Brian Halligan and Dharmesh Shaw in 2006, HubSpot has been a rocketship in the rapidly growing SaaS marketing software field. With more than 10,000 customers in 65 countries, HubSpot has become a cult following for a new class of inbound marketers who focus on attracting rather than harassing new customers.
Halligan and Shaw literally wrote the book on inbound marketing. For independent reviews on HubSpot's software, check out G2Crowd. And yes, HubSpot ranks No. 1. Company growth has been astronomical. A couple of years ago HubSpot was at 100-200 employees, and now it's well over 600 and climbing. With offices in Cambridge, MA; Dublin, Ireland; and Sydney, Australia, the world is learning about HubSpot quickly. According to Crunchbase, the company has raised more than $100 million in funding but is still privately held. I can't tell you what HubSpot's revenues are, because I'm sworn to secrecy. But let me tell you, it's impressive, and the future looks bright.
Since 2006, HubSpot has been dancing with the one that brought them, inbound marketing. Nobody on the planet does a better job of mixing spirited blog posts, videos, events and helpful eBooks into their content marketing mix and using every available channel where their customers are likely to be found. And yes, all of this drives top rankings on Google and elsewhere. Last time I checked (more insider info), HubSpot was bringing in more than 100,000 leads per month. Are you kidding me? Clearly HubSpot doesn't need to spend a boatload on retargeting ads or programmatic media buying, but I'm sure they play around with those channels just for grins. But is inbound marketing enough to explain HubSpot's phenomenal growth? Not a chance.
Back in 2009, HubSpot made the extremely wise move of opening up a Partner Program. Kuno Creative was one of the first to sign up because we saw a great opportunity to enhance our services with inbound marketing and to follow HubSpot into the stratosphere. I'll let you know when we get there next week.
Since 2009, more than 1,500 agencies like ours have signed up, and HubSpot has developed an extensive training and certification program to support us. What does HubSpot get out of this investment? We act as channel partners, or value added resellers, for the software and we help HubSpot customers achieve their marketing goals. That translates into more sales, lower customer acquisition cost, reduced churn and increased customer lifetime value for HubSpot. Bingo! I don't think I'm at liberty to disclose what percentage of revenues we partners have bagged for HubSpot, but believe me, it's substantial.
I have learned a lot by studying HubSpot's go-to-market strategy over the years, and we emulate much of what it does in our own modest way. But the thing that blows me away is how well the brand nurtures its customers. From the beginning, there has always been superior customer support, even as the user base has grown so rapidly and the product line has expanded exponentially. You call HubSpot with a question or problem, you speak to a real person, and you get results quickly, or at least you get the truth about what's going on. That's good enough for me. Nothing kills customer loyalty like answering machines or generic automatons treating you like you're a recording.
Add to that an amazing educational experience called HubSpot Academy, and you're looking at happy customers. HubSpot takes great pride in not only teaching both existing and potential customers how to use HubSpot, but also best practices for inbound marketing. New customers aren't allowed to flounder on their own. Instead, HubSpot insists on holding your hand and making sure you get the most out of your new inbound marketing Ferrari. Existing customers aren't forgotten. HubSpot's Inbound Marketing Consultants and Partners provide regular opportunities to improve on your marketing results. This support network is vital to successful company growth, reputation and customer retention.
Last but not least, HubSpot loves to party with its customers! At HubSpot's Inbound User Conferences, the company celebrates another year of mutually assured success by inviting customers from around the world to learn, network, collaborate and rock with other users and HubSpot employees. Yes, it costs a little money, but this kind of investment puts the icing on the cake for even more growth in the coming years.
What will happen when HubSpot becomes a mature SaaS company, like Google or Salesforce.com? We'll see, but I hope it doesn't quell any of its youthful exuberance and fun approach to marketing. I doubt that will happen. HubSpot gets it.