Chris Savage - Baremetrics

This week I talk with Chris Savage of Wistia. We talk about growing up surrounded by computers and coding, how film making helped birth Wistia, what the key parts of success have been and how to stand out in the crowd of video space. Hope you enjoy.

Josh Pigford: All right. Hey, Chris. How’s it going, man?

Chris Savage: Very good. How are you?

Josh Pigford: Doing well. Doing well. You’re in Boston, is that right?

Chris Savage: Yes. Technically Cambridge.

Josh Pigford: Okay.

Chris Savage: Generally, the Boston area, yes.

Josh Pigford: Yep. Yep. Yep. Are you a runner at all?

Chris Savage: I do run. I’ve run a couple races in my day, but nothing longer than a half-marathon.

Josh Pigford: Gotcha. So you didn’t do the Boston Marathon.

Chris Savage: I have not done it. I’ll go and cheer, but I … a marathon for me seems great, but the Boston winter is so cold that it just seems like I’m not training in that. [inaudible 00:01:16].

Josh Pigford: Running in the cold is maybe one of my least favorite things. It just hurts. Did you grow up in Cambridge or outside of it?

Chris Savage: I grew up in Rhode Island, in Providence, Rhode Island.

Josh Pigford: Gotcha. How did you end up in the Boston area?

Chris Savage: So, I came up here to start Wistia. My co-founder and I went to college together, went to Brown, which just happens to be in Providence. And he had moved up to Cambridge to take a job at a software company, and we were talking about starting Wistia, and we were like we should probably be in the same place. We should probably be working out of where we live, and he was living in a ten person house that had a room that was opening up and so my girlfriend and I moved up here and moved in, and I did not expect to stay here or to set up roots here or to have a real company here. And now I’ve been here for almost 11 years which is crazy.

Josh Pigford: Oh, that is crazy.

Chris Savage: Yeah.

Josh Pigford: I’d love to get the backstory on you pre-Wistia, like you as a kid, what were you into?

Chris Savage: I mean, I was really into video games and I was really into just like new tech stuff. My dad is a computer science professor, and my older brother majored in computer science and worked at Microsoft very early as did my former brother-in-law. And so I just grew up around just like brand new stuff. Like I remember the day we got our DVD player. We went to Circuit City and really pumped, I was so pumped about this and everyone I talked to was like “You’re such an idiot. There’s no DVDs out.” And I swore to never touch a VHS tape again because I was so excited about this new technology and it took a few years for me to break that promise.

But, yeah, I was into trying to build things, into, I don’t know, normal stuff, playing soccer and running around in the streets and trying to get into too much trouble just enough to keep things interesting.

Josh Pigford: So do you, I mean, if your Dad’s obviously big into … but I mean, computer programming specifically? Or …

Chris Savage: He’s really like theoretical computer science …

Josh Pigford: Okay.

Chris Savage: … and now today focused on cybersecurity.

Josh Pigford: Okay, cool. So, I mean, were you ever … obviously you were surrounded by pretty fresh technology growing up, but did you ever really get into the sort of development side of things?

Chris Savage: I dabbled in high school. I mean, I learned C++ and was making games and things and I learned how to build webpages, but I never really got deeply into it, mostly because when I tried, I was like I’m not sure that this is exactly what I think [inaudible 00:04:11].

Josh Pigford: Sure. Sure. So you went to Brown. What did you major in at Brown?

Chris Savage: I majored in something called Art Semiotics.

Josh Pigford: Okay.

Chris Savage: And that is the study of signs and how words are interpreted and things like that, and really for me, it meant majoring in film.

Josh Pigford: Oh, gotcha.

Chris Savage: So, I learned about a lot of theory behind film and then actually got to put that theory into practice by making, you know, I shot in 16 millimeter and, of course, like mini-DVD and all the other very fast changing video technologies that were coming out …

Josh Pigford: Sure.

Chris Savage: … in probably [inaudible 00:04:50].

Josh Pigford: Yep. Yep. Yep. So, then what was … you met your co-founder at Brown, right?

Chris Savage: Yep. Yep.

Josh Pigford: How does the transition come from sort of essentially majoring in film making to starting Wistia?

Chris Savage: Yeah. So, I had been really fortunate and had interned on a project when I was in school which was a feature length documentary, and it was a documentary about the former mayor of Providence who, at that time, was the longest serving mayor in the US, but he’d actually been kicked out of office once and was about to be kicked out of office again. The first time in 1980 for assaulting his best friend who was sleeping with his ex-wife and the chief of police of Providence held his friend down and he threw a fire log at him and a bunch of other things happened, so he was kicked out of office and put on probation for ten years, became a very popular radio host in Rhode Island, ran for mayor again after his probation was up ten years later and won by 100 votes.

And now, and when we were following him, he was basically, the FBI was coming at him with like 26 charges of a number of different things including racketeering and all this stuff, and we followed him for six months because he didn’t think that they were going to get him. So he’s like … he’s thinking this was his glory tour. And started working with this documentary, and of course, the story was so outrageous and he did end up going to jail, and we had everything, that we ended up getting this documentary all over the place. So, we distributed it ourselves. We got into a bunch of festivals. Won a bunch of festivals. Won an Emmy, all this stuff, and this is incredible for me as a 21 year old …

Josh Pigford: Sure.

Chris Savage: … involved in this thing.

Josh Pigford: And it’s basically your first real thing around film making that you’re …

Chris Savage: It was the first real thing. It was the first real thing. And, it was mind blowing and also humbling because the film maker that I worked with, she’d worked on this for five years, and when we premiered it at a festival there were 600 people who saw it, and they loved it but they saw it that one night and then moved on and that’s it. And I kept thinking there’s bigger audiences for this stuff. And I also wanted to take this, the trailer for this film and the other movies I’d worked on in school and show them off online, and so back then that meant encoding the videos yourself into QuickTime or Real Player and Flash video existed but you had to have your own copy of Adobe Flash to make Flash videos.

And so it was, you know, it felt very limiting and confusing and then in 2005, I saw all of these online video companies very quickly pop up that were all doing user generated online video.

Josh Pigford: Yep.

Chris Savage: So this was YouTube and also companies like VEO and [inaudible 00:07:50] and Video Egg and a number of other ones were all doing the same thing and Brendan, my co-founder, started talking about this, and we’re like what is happening? There’s a huge shift happening in the technology and the shift was that they were all using open source tools to do the encoding of the video. And by doing that it was totally democratizing the ability to get video online because you didn’t have to think about what format you have on your computer. You just upload anything and it would work. So, we realized wow, this is probably going to open up all these new applications where you can use video online, but there was never a time to start something. Maybe we could start something now and we can give this a shot, and with my background in film and Brendan’s background in computer engineering, we thought, fuck it, we could figure it out.

So that’s what caused us to start and we’ve been focused on video since day one, and it took us about a year to figure out that actually we should be helping businesses and people who use video but they don’t have video expertise, like they need more help, they need the tools to be easy and they value that. And we found some little niches to focus on, and it worked which is pretty great.

Josh Pigford: So I think it’s interesting around, I mean, the time that you guys popped up ten years ago or so, I think I was in the middle of building random stuff, but the problem there was video becomes, it was becoming a thing that everybody wanted but was having a really hard time figuring out where do you put it, and especially when it was the user generated side of stuff, like always trying to find … I remember having the hardest time finding a way to have users upload a video …

Chris Savage: Yes.

Josh Pigford: … and then basically turn it around so that it could be shown.

Chris Savage: Yes.

Josh Pigford: So like how did you guys figure out to focus on the, essentially what you’re doing now, where you let businesses upload the videos that they want to upload and not get sucked into the social network craze of people needing to mass upload tons of videos?

Chris Savage: That’s a really good question. I think we were trying to figure out, and it’s funny. In hindsight, it all made sense. I look back on it and it seems smart, and at the time I feel like we were just fumbling around in the dark, trying to get something to work. But what ended up happening was we found a little niche about a year after we started and this niche was companies that wanted to share video internally.

So, share video for training purposes and even collaboration, and our first customer was actually was a medical device company, and they were doing clinical trials around the world and they shot video of every surgery that they did, so the video was real important to them because that’s how they were going to iterate on their device. But they were sending these … these videos were on a DVD. So you do a surgery in Chile and it takes two or three days before people can see it and obviously that really slows things down, so we said, hey, why don’t we give you .. we actually at this point had built the video hosting, but we said, why don’t we give you something that lets you privately share these videos, and we’ll also let you see who’s watching them and some other things that seem like they’d be really helpful in this use case.

And they were like “That sounds amazing.” So we did that for them, and then we found some companies that wanted to do training. This company, Sonus Networks, which is a huge telecommunications company. I met the guy who runs learning by complete chance at a start up event and told him about what we were trying to do and he was like “Well, I think that would work really well with us. We’re sending DVDs around to people to train them or we’re bringing them in person,” and so what ended up happening was we found this little niche and no one else was focused on this niche, so we actually could solve this problem pretty well, and then also by solving that problem pretty well, it generated word of mouth because if this guy who was in charge of learning talked to someone at another company who was in charge of learning, he would tell them “Oh, I’m using this new Wistia thing. You should try it.”

Josh Pigford: So how did you, I mean, were you guys also helping people get their content online or was it you were just always providing sort of the UI and they could do it themselves?

Chris Savage: We were always providing the UI and letting them upload things indirectly. We were very, very drawn to building a product that was self-service, and that’s where we felt the future of everything was going, and we just wanted it to be frictionless. We wanted [inaudible 00:12:22] to sign up and use it in the middle of the night and not have to talk to anybody, which at that time felt somewhat novel because there’s was the sign up to get demos that would take forever and I’m like I don’t want to a person. I just want to upload it. I just want to use it.

Josh Pigford: Gotcha. In the earlier days, I mean, the tech around processing and coding videos and all that stuff was, I mean, still relatively fresh, but for you guys was the technology side the hard part of was it the business part?

Chris Savage: Yeah. The technology side was hard but the business part, I think, was … it was both at different times, right?

Josh Pigford: Yeah.

Chris Savage: In the early days, it was like Brendan was learning Ruby on Rails and we were talking to people all the time about how we could do that better, but I don’t think it was like that hard for him to figure it out. I think the thing that we struggled with was trying to balance the product and the business, so what stuff should be in the product, what stuff should you have to do yourself, what things should you charge for, what things should you not charge for, and some of the moments that really, in hindsight, I’m like “Oh, wow, of course that’s the smart way to do it,” but back then felt like fumbling, we found a tiny niche with a private video sharing, got to about 30 paying customers and then people started saying “Hey, we want to use your tool to put videos on our website,” and we’re like “Well, why don’t you use something else? Why don’t you use YouTube? You don’t need us for that.” Like, “No, we want all our videos in one place and we like that we actually had analytics back then for training and we want these analytics and the videos on our site.”

We’re like “Okay,” and we built that and then the rate of growth of the business changed very quickly. That kind of felt like we were starting to unlock this simple idea that people want one platform to let them use … almost like they don’t think about it as like “I need to use videos externally or internally or for training in the market,” they just think of it as “I need to use video and I want good tools.” Another moment that was like that was when we, after we did that, we started using Wistia ourselves as customers. We started actually trying to market with video.

And that was an enormous turning point because very, very quickly we figured out “Holy, shit. We’ve been guessing at what a product should be and now we know.” We know what stuff would help us do our jobs better, and so we started innovating and building things on the product that it turns out the market really wanted because the market had the same challenges that we did, and I didn’t really get that before. I thought I could guess at what a good product was, but you actually, you have to be the customer, at least in my opinion, to truly understand which things are important.

And now that’s powered so much of what we do, and our whole, you know, our brand and our ethos of how we build product and how we present ourselves, so really the whole business has been transformed through some of that learning.

Josh Pigford: So, I mean, early on was the cost of hosting video or just storing it, was that ever a big burden for you guys? I mean, it’s certainly much cheaper now than it was ten years ago. Was that ever an issue? I mean, I think of video being one of the most sort of resource intense things to store.

Chris Savage: Yes. It is, and I think we see that even in our gross margins today, that our gross margins are not going to be the same as like a lot of SaaS businesses because …

Josh Pigford: Right.

Chris Savage: … just because video is so expensive. I mean, part of the other reason we decided to start the company is because AWS existed, and we thought “Wow, it’s going to be so cheap to start.” And we also knew that we needed CDNs to make video, like the delivery of the video really fast and we negotiated with this small CDN, it was called Panther Networks, at just a per gig fee, per gig delivered, and they did not want to do that. And we said “Look, this is going to be a huge thing. It’s a start up. We should do this.” And they were like “All right. We’ll take the risk.”

And our first bill with them, the first month, was like two dollars, and I think this guy thought he was going to really sell a big deal, and it took years for that to scale up so we didn’t even use to charge for how much viewing people have in the early days. We were just more focused with getting the usage, and then eventually of course, I don’t think this guy got any credit for that, but the contract exploded, got really huge and we figure out, the prices came down, we figured out a way to have it make sense with our business model.

But, yeah, it was … I think if we tried to start a year earlier, we couldn’t have without a huge run of capital.

Josh Pigford: So what’s, speaking of, the landscape was obviously changing a lot then, so what does the hosted video space look like now compared to then? I mean, to me it almost seems less competitive, but that’s obviously way outside the [inaudible 00:17:29].

Chris Savage: Yeah, in some respects, I think it’s less competitive and some respects it’s more, so five years ago, there were a ton of companies that looked just like us and trying to business video and trying to do it for everybody at the same moment and really, I think, most people were focused on delivery of the video as opposed to the applications of the video. And then, we were just very, very persistent and we never raised a lot of capital which I think gave us a lot of freedom because a lot of these competitors we had raised a lot of capital and then to fuel their raises they had to hire, they had to push aggressively, they had to … excuse me, build the big sales team, and the revenue wasn’t there. The market was too early, so they floundered, they sold, you know, they were [inaudible 00:18:23] hired and it left us in this funny spot where actually there’s less competitors today than we’ve ever had in some respects.

Josh Pigford: Sure.

Chris Savage: Now, there’s more indirect competition because adding a video to a website’s a lot easier than it used to be. When we started you had to use a professional tool to do it, and today more CMSs and more applications and more video assisted things are being built, and so it’s not direct competition with us as a business video platform, but it’s indirect in that there are videos that you might not ever need to put on something like Wistia, and it doesn’t make sense to. And so for us, it’s been an interesting balance of with our business model, where should we be focused and it’s pushed us towards focusing on those power users who really care about the data and care about integrating into other systems and the harder problems to solve, which tend to be the things, I think, that live on and last over time as opposed to just someone just adding a video to their website.

Josh Pigford: To me, it would be, especially in the past, I don’t know, two years, the prevalence of video and probably more specifically, I think live video. I mean, that being a hard thing to not just want to chase that stuff when, with live video on Facebook is such a huge thing, and streaming stuff on Periscope or whatever, how do you not get distracted by that stuff and trying to build and sort of capitalize on what could be a fad?

Chris Savage: Yeah, I think, we’ve been pretty good. Someone told me this analogy recently about competitors and I really, it stuck with me which is, imagine you’re on a mountain road and you have a competitor in front of you on something, and it’s foggy and you’re driving and it’s these twists and turns. You want to pay attention to where their car is going, obviously, because you want to try to see the road, but the challenge you run into is if you stay too close and that competitor takes a turn off the edge of the mountain, you’re going, too. You’re done.

Josh Pigford: Yep.

Chris Savage: And I think we’ve tried to be willing to be patient on things like that and figure out what is the right form of, if it’s live video or anything else, it’s going to make it’s way to work, and how should Wistia play there? And maybe we should be integrating with other companies, maybe we should be building our own stuff. That’s kind of how we treat it, and so I don’t think we have to be first on everything, but by kind of being patient and looking at that, we end up usually figuring out like “Oh, well. Live video, there are a lot of people specializing in it.” Facebook in particular is doing a huge campaign on it. You go and do the research, it’s because live videos on Facebook are watched as much as produced videos on Facebook, so that means more producers for them, more ads. It all makes sense. And, I don’t see a huge influx of people using Facebook live video and then requesting that same use at work, where I do see things like Snapchat changing behavior and making people more comfortable and making authentic video, and that is changing expectations at work.

So we try to look at those, and what are those expectations that are changing, and then how does Wistia fit into that?

Josh Pigford: So, I mean, everything’s sort of funneled through the lens of how will businesses need to use this.

Chris Savage: Exactly.

Josh Pigford: Right. So, a lot of entrepreneurs, I mean, myself included, have this sort of extensive history of trying lots of things, and most, if not all of them failing. But I mean, Wistia was, for you, I mean, really your first foray into entrepreneurship, right?

Chris Savage: Yeah, really. Yes.

Josh Pigford: So I mean, what do you attribute the ability to, here we are ten, eleven years later, that sort of your first real stab at entrepreneurship working out? I mean, luck or do you think it was just that hyper-focusing on solving a niche problem or what?

Chris Savage: Yeah. I mean, definitely there was a lot of luck. I can remember specific moments that someone emailed us about something, and we jumped on it really fast. It turned out that they were an important person. They introduced us to their company. They talked about us publicly, and suddenly we saw a boost come forward and things like that. I think, at least for me, luck is about being persistent and being ready to capitalize on that luck. I actually think that the reason we were successful is that in the early days, our cost of living was so low, and we kept it very dramatically low for the first six years of building the company, and what that meant was, we needed 1,500 dollars a month in revenue, two years into building the business to cover all of our expenses, like housing …

Josh Pigford: That’s incredible.

Chris Savage: … and everything, right? So when you need 1,500 dollars a month in revenue, that’s usually scary when you have zero, but that first month when we got someone paying like 400 dollars a month that was like “Oh. We’re not that far away.”

Josh Pigford: That’s doable, right.

Chris Savage: Yeah, and then it was like three months later you get another one and you’re like “Okay. I’m halfway there and the amount of money we have in the bank is going to extend us a lot longer,” and then again and again and I think it was just I told people we were doing this, Brendan told people we were doing this, and we were just unwilling to fail, and this seemed like the best way to give up the most options.

And even today, we try to run Wistia very leanly, and I think it’s been ingrained in us, and for better or worse, you miss things when you run shit that lean, but I also figure if I can keep running this business in ten years, if I can build a business that lasts, then if I’m three months late on something it doesn’t matter.

Josh Pigford: So, in those early days you and Brendan were living in the same house, working out of the house or …

Chris Savage: Yes. Yeah, so we were living in … yeah.

Josh Pigford: So, you’re married now. Were you married then or … “

Chris Savage: I was not married then. My girlfriend who is now my wife did live in that house, and Brendan’s girlfriend who is now his wife also lived in the house for a while, and there was a period of time, we spent two years working out of the house, and then another two years living together while we worked out of a quote real office, and I think that it raged on our girlfriends for a long time because Brendan and I would be working all day, talking all day about shit and then we’d all be eating dinner because it was almost like commune style …

Josh Pigford: Sure.

Chris Savage: … like sharing food with everybody, and we wouldn’t shut up about Wistia, and then when we were commuting, we’d commute together, we wouldn’t shut up when we got back, and they were like “What is wrong with you guys. This is all that you talk about. This is all you do.” And so at some point, it was like “I should move out. My girlfriend and I should move out.” And it was like a year and a half later that we decided to get married, and I don’t think that that’s a surprise given what it means when you actually have your own space, so yeah, it was crazy. It was crazy time spending that much time together. And it was a trip.

Josh Pigford: Sure. I mean, how was that, you know, you mentioned operating on such a lean budget. I mean, did that strain your relationship or was it just sort of like “Eh, it’s been like this from the beginning. We’re essentially kids right out of college, so like we don’t really know any different.”

Chris Savage: It was basically that. It was like … because we came, we were a year out of college, it was just like we’re used to this.

Josh Pigford: Yeah.

Chris Savage: And we literally had a conversation that was like if we can just not change our lifestyles then we can probably do this for a while, like college had been fun. It wasn’t like I was complaining that we were in a shitty house [inaudible 00:26:25] were in a shitty house, it was like it was fun. And that was a very conscious decision and it was interesting because in that first year that I was out of school, I had friends who went into investment banking and consulting and they started getting paid real money and very quickly and they all got nice apartments. And it also became clear to me that they, now that they could go to fancy dinners, they wanted to go to fancy dinners. They wanted to keep doing that, and it was just like, we just kind of assumed that we’d get used to whatever we were doing.

And so we just tried to not get used to stuff, and …

Josh Pigford: I think that …

Chris Savage: … it seems to have worked.

Josh Pigford: Well, I think that’s a hard part for people who don’t start out building anything. I mean, it’s like when they’ve had sort of a typical job and then they have to potentially …

Chris Savage: Totally.

Josh Pigford: … cut back, and it’s hard to make that adjustment. And it’s even harder, throw in kids and all that stuff.

Chris Savage: Oh, yeah. I mean, today, having like, I have … I’m married. I have a daughter. Do we have things that we like to do and people we like to see? We travel and all that stuff. If you told me I had to do this today, it would be really hard. Much, much harder to do. And I’m thankful for that, and I do think a lot about that, to your point, about how does everyone, what are the steps someone can take that make those early days easier to try to do something like this.

Josh Pigford: Okay, and I have this conversation, or my wife and I have this conversation a lot where I’m same as you in that I started building stuff in college and so my wife and I got married right after college, and we haven’t ever known real sort of stability when it comes to finances in the sense that I’ve always just sort of been an entrepreneur, so we’ve had the ups and downs, that’s just been part of it for us, but I mean, you think of somebody who hasn’t done that and the barrier to entry for them is, it’s substantial, you know? And it’s hard to even help somebody get through that because you’ve already got these expectations about what life is supposed to be like, right? [crosstalk 00:28:32].

Chris Savage: I mean, I’ve talked to a lot of people who do the consulting thing, and they figure out how to become a consultant and then they hope that they’re going to have time to work on their own project, and it’s just hard because when someone’s calling you and they’re like “Hey, here’s 20 grand for this project.” You’re like “Oh, my God.” [crosstalk 00:28:48]

Josh Pigford: You can’t say no to that, right?

Chris Savage: You can’t say no to it. And then at the same token, you’re not able to invest in yourself. And I think it’s also hard because then if you raise a lot of money, you get on the treadmill of raising a lot of money, and I think that’s why people really celebrate raising money because obviously it allows you to do this. It can be the cushion, and that’s why I always try to encourage people, if they’re raising money, that you should see if you can also manage your lifestyle at the same time just to get you out of that.

Josh Pigford: You mentioned earlier that moving from this sort of internal private videos to making like “Oh, Wistia can host all the videos,” and then being your own customers, were kind of two points that maybe changed things for you guys. I mean, was there anything else where there’s been this one or two things that really changed growth for you guys, especially in the past maybe, I don’t know, five years?

Chris Savage: Let’s see, yeah. So being our own customer was a huge one from a product perspective and a marketing perspective. I think there’s a sort of mindset when, I mean, for a long time when we would try something. If it didn’t work we would just assume that that thing didn’t work for Wistia. So and example was like we’d try scaling sales and we’re like “Uh, doesn’t work.” Like I guess sales doesn’t work at Wistia.

Josh Pigford: Right.

Chris Savage: And then later I started to realize, no, it probably does work. I just don’t know the Wistia way of doing it, and there was a difference there which was like in that second world, you want to figure out how to sustain the bets that you’re taking, and so right now, today, I think a lot about projects that we’ve tried and how long we tried them for and have we tried them enough different ways, and often it’s like continuing to try to work on a problem and trying lots and lots and lots of different solutions that eventually is where the breakthrough comes, and so there’s been lots of little breakthroughs that added up to big ones for us just by doing that.

Josh Pigford: Yeah.

Chris Savage: But it’s, I don’t know, the macro level things are like when we really started marketing by being our own customer, how we started thinking about the product like that, and I would say I feel like I’ve learned a lot about organizational design and how to try to structure and organization that works autonomously, doesn’t need a lot of help, and how important that is and we really missed that for a long time and when we figured that out, it made a huge difference.

Josh Pigford: Sort of bouncing off that, what have been some of the, I don’t know, maybe atypical customer acquisition strategies for you guys? Like I remember in this was probably 2012 or 13, I signed up for Wistia and got a Wistia lighting package deal shipped to me from you guys, so I mean, do you guys still try sort of random things like that or … ?

Chris Savage: We try lots of stuff like that, yeah. I mean, so we did the lighting kit thing for a while and it worked really well, where we’d send people a lighting kit in a box, but it was also kind of expensive and it took a lot of time to put together, so we were like how are we going to scale this thing? We’ve given away an enormous number of t-shirts over the years. I was just tallying this up recently, and we’ve given away like 16,000 shirts over the last two and a half years.

Josh Pigford: You need to have somebody full time just to ship t-shirts.

Chris Savage: Well, basically we kept, it started small and kept getting bigger and bigger, and we then outsourced it to one firm and then they couldn’t handle it, we’d do it through another one. We have like a new iteration of it coming soon and it’s funny because it’s pretty hard to track the success of giving out t-shirts because they don’t work as advertising. They work, I think, as a brand impact thing. Like if someone gets a shirt and they love it and it’s soft and it sits in their drawer and they look at it and they think “Oh, that’s one of my favorite shirts,” then they’re going to recommend your company more.

I would say a lot of the things that I tell myself and I remind myself of is if you look before today, a year ago, five years ago, ten years ago, 15 years ago, there were a lot of incredible companies that were built, a lot of them were built to be quite big and a lot of them were built by trust and instinct, and you can have as much data as you want on how a marketing campaign is performing, but if you really believe in it and can sustain the bet often, it ends up working.

And like content marketing was that was for us. When we started doing it, we kept doing it, we kept doing it, it took years before it really started to work, and now today, like an enormous amount of our traffic comes from content marketing. And of course, that makes sense, you make great stuff, people like it, they share it, it gets indexed, more people see it, it gets shared more, blah, blah, blah, blah, blah, and suddenly you have this asset of thousands of posts and videos and comments and discussions and they all end up being this magnet for you for advertising. We played around with advertising. It’s so hard to track until you realize that all these giant brands do it all the time, and they had to start and figure it out, it usually comes down to something that connects with you and that you’re proud of and then the question is how can you sustain it long enough such that you get the qualitative learnings that make you feel comfortable that the quantitative ones would come eventually.

So, I just try to think about our context and the history of building companies a lot, and what are the things that everyone’s always done that we should be figuring out the Wistia way of doing.

Josh Pigford: Yeah. Well, I think, you know, you mentioned that in content marketing, that where it requires so much work up front and the payoff might not come for a long time and that’s the same with maybe, traditional advertising whether that’s something like a t-shirt or a billboard or anything like that’s brand play as well, but I think the thing that you mentioned early on is how you guys took on a small amount of capital and you were never forced to make decisions purely to really, I guess, to stay in business, right? I guess things weren’t ever that dire that you had hired so far ahead of runway that you were going to go out of business if you couldn’t figure out how to close some huge deal soon.

Chris Savage: Yeah, we did have … we purposely under-hired for a long time to try to get enough runway such that we didn’t run into that problem. We did raise two angel rounds and after the first one, we made a miscalculation and had a huge legal fee come in, in conjunction with some other couple huge fees and we realized oh, my God, we’re going to run out of money really fast.

Josh Pigford: Yeah.

Chris Savage: And it happened to be at a moment of time when we were switching from the private, just private video to also embedding and using video for marketing, and that changed the business so much that we were able to go back to our investors and say “Hey, look. We figured something out here. Bad news, we were close to running out of money. Good news, I think if we just sustain, we will get to profitability,” and they were like “Ha, ha, you’re not going to get to profitability, but you’re right that you’ve found something.” And then we just continued the same strategy of staying lean, so I’ve been there. I’ve been days away from it, and sheer luck of the timing of when we tried something working out is what helped us pull through.

Josh Pigford: But you know, back in the … you pretty intentionally stayed off the train of much as possible of having to keep raising round after round …

Chris Savage: Yeah, oh yes.

Josh Pigford: … of feeding that, right?

Chris Savage: Yes.

Josh Pigford: And so it’s like those decisions, you can take risks like “Well, we’ve been doing content marketing for five years and now we’ve got thousands of posts,” but you can’t set out to do that up front unless you’re willing to wait for the payoff.

Chris Savage: Yes.

Josh Pigford: And I think a lot of entrepreneurs, especially in their early days, they keep trying to find these quick wins because almost they have to.

Chris Savage: Yeah, no, I mean, I think that’s completely right, and I think the thing that I always think about is how do I get myself into a position that this can go for the long term because it will probably work over the long term, but also a lot of those quick wins, you have to do them and they also disappear. They’re a quick win because everyone hasn’t discovered it, and once they discover it, it stops working. And that’s like classically how marketing works and we’ve learned that lesson many times, where we tried something, it works super well and then everyone starts doing it and it stopped working.

And so you can keep [inaudible 00:37:44] those things up, but if you’re not also doing long term things, even just planning for success, I think it gets harder a year down the line, two years down the line, three years down the line, if your company’s still going, you haven’t done those long term things, you’re like “Shit. I wish I’d done that earlier.”

Josh Pigford: Yeah. So I would say you guys are a really creative company in that you obviously produce a kind of content and it’s lighthearted stuff, like you don’t take yourself too seriously with a lot of the marketing stuff. I mean, has that always been the case or did that become the case after a few years? How has that sort of lighthearted creativity played a role in the company?

Chris Savage: It’s played a huge role and we found it by, we were just basically not getting a lot of traction and had this website that made us look like super professional, that’s what we thought. I think anyone looking at it now would be like “What a joke. This is a tiny business.” Our management page, had a management page, didn’t say employees, and we tried to imply that there were more employees that worked for the company, and there weren’t and we did all these things like that, and nothing was really working, so at some point we said “Well, let’s just make a team page that is so we can send it to our parents.”

And there were six people in the company at that point and so we took a photo of the six of us standing in front of a whiteboard because that seemed like a really business-y thing to do, and sent it around, and Brendan did something funny to it, which is he basically made it that if you typed dance on the page, it would start playing girl talk on these, like a crappy gif of lasers would come on behind us. It seemed so dumb and he literally did it because someone on the team, it was their birthday, and Brendan just thought it would be fun to do this for this guy Jeff. He was like “Oh, Jeff will appreciate this,” so he did it.

And we tweeted it out and we put it on Hacker News and all the other things that we did back then for everything else and we just assumed nothing would happen. And this time what happened was it took off and went viral. People were like “This is so funny. It’s the best team page I’ve ever seen,” and all this stuff, and we made it for ourselves. We made it basically for our parents and friends, and it was not professional. It was authentic and weird, and then a few weeks later we got a new influx of sales, and at that time we had a two week free trial, so you’d look back at two weeks from when this trial started and they all started that same day.

Josh Pigford: Oh.

Chris Savage: I was like “Holy shit.” Our silly little team page that we made for ourselves that was completely goofy and not professional, the opposite of what we had before, just got us a bunch of customers. And then that happened again and again, and we made videos that were behind the scenes that were goofy and people loved that. We did more and I started to realize, wait a second, this authentic stuff, the stuff we were showing behind the scenes, the stuff where we’re honest about the size of our company and our challenges and all this, this stuff actually is what people connect with.

And one of the key insights there was that every single person, even if you’re selling it to a business, like they’re an individual, they have a personality, they want to work with people they like. We make emotional decisions that we rationalize, and so it all kind of like kept encouraging us more and more and more to try to be really creative and lighthearted in how we communicate.

And now, there’s sometimes that we communicate things and it’s pretty unbelievable where our community will say “Hey, this doesn’t feel like you guys, like it’s not fun enough.” It’s like “Oh, we’re talking about something like changing your account. We didn’t think it should be fun.” They’re like “No, that’s what I expect of you.” Like “okay, good to know.”

Josh Pigford: Right.

Chris Savage: So, yeah, it started with a small win and over time it has turned into so much of what Wistia is, which is amazing because I feel like we have always been. We just weren’t always willing to show it.

Josh Pigford: Yeah. Yeah. So, wrapping things up, so what’s the focus for you guys for the next six to twelve months? Anything specific you guys are really honing in on or just kind of keep doing the same things?

Chris Savage: Yeah, no, so we’re launching a new product in June which I’m really excited about and we were basically talking about watching those trends that

are happening. We’re just seeing that more and more and more people are getting comfortable with making authentic video and as it’s becoming easier to make video and video that’s high quality and looks really good, video is spreading more across organizations, so it’s not just being used for marketing anymore. It’s being used for smaller audiences. Sometimes that’s like one person.

Josh Pigford: Yep.

Chris Savage: And in our customer base, we’ve seen a lot of companies that are starting to use videos for sales, using videos for partnerships and business development and all this stuff, and they’ll make one video for one person and if it works, they get one customer, but it’s become so cheap to make a video, that it actually, the economics makes sense, so we’ve got a lot of things brewing there. We’re trying to make it easier to make the videos, integrating them into a lot of different companies that make it easy to make these really incredible videos, trying to build more tools into the product that help you use Wistia and video across your business, not just in marketing. So, there’s a lot of stuff coming which is just really fun and really exciting.

Josh Pigford: That sounds awesome. All right. Well, that’s all I’ve got, Chris. Thanks for helping on the call, man, it was good talking to you.