It seems every venture-funded startup wants to be an enterprise software company. Yet, selling to the enterprise is challenging and requires special skills and experience. This episode explores the challenges and solutions with someone who has successfully built a software startup with large enterprise customers. 

Abinash Tripathy is co-founder and CEO of Helpshift, the world’s leading customer support platform for mobile. Abinash brings more than 17 years of experience within technology, Internet and mobile, having created and run a number of early and growth stage companies. Prior to founding Helpshift, Abinash created and ran a number of early and growth stage companies where he was responsible for conceptualizing and delivering the world’s first Unified communications platform, Mobile Photo Messaging and MMS products to the market.

Transcript

Michael Krigsman:

Welcome to Episode 191 of CXOTalk! I’m Michael Krisgman. Today, we are talking about enterprise software, and how do you build an enterprise software startup? We talked with founders, we talked with VCs and entrepreneurs, and everybody wants to build for the enterprise, sell to CIOs, sell to lines of business across a company, but it’s really, really hard to do. And our guest, Abinash Tripathy, who is the CEO and founder of Helpshift, which is a startup that has managed to cross that chasm, and is successfully working with very large organizations. And so, we’re going to talk about enterprise software. As always, there is a Tweet-chat going on simultaneous with this live conversation, and so join us using the hashtag #cxotalk; and you can ask your questions of Abinash, and you can join the conversation!

So, Abinash Tripathy, how are you?

Abinash Tripathy:

Great! Thank you Michael for having me on the show!

Michael Krigsman:

Well, it’s awesome you’re going to be here, and you’re the CEO and founder of Helpshift, so let’s being by giving us a brief background about Helpshift.

Abinash Tripathy:

Great! Helpshift is an in-app customer service product. We built this product because we saw something that was changing in the environment. Consumers are using apps, employers and companies are using apps, and apps are becoming sort of the mainstay in the mobile era. And what we observed is that user behavior is changing as well, that people don’t want to be on the phone or email someone for customer service, but they want to engage in messaging-like behavior, which is very attuned to the mobile-centric world we live in. And, so we brought that paradigm into the app environment, and started working with very, very large brands like Microsoft and Supercell, who are sort of the leaders in the mobile space, and delivered the first mobile, in-app customer service experience and we have lots of customers now who enjoy the product every day.

Michael Krigsman:

So, tell us about the company in terms of how long have you been established, how much money you’ve raised, give us some of the vital stats about that.

Abinash Tripathy:

Yeah, great. So, we’ve been around since mid-2012; the middle of 2012. We didn’t have a product, we had a very small team; and we built the product, launched the product in the market in the middle of 2013, and then we’ve been selling the product since then. And basically, we’re a post-Series B-stage company, we’ve got 20 employees worldwide, and we’ve got lost of customers, and it’s a great feeling to be part of a company that’s really making an impact.

Michael Krigsman:

Abinash, as I said in the introduction, it seems like almost every startup these days wants to be an enterprise software company, and it’s not an easy thing to do. Can you summarize for us the challenges: Why is it so hard to sell successfully to the enterprise, and then, as we have this discussion, we’ll talk about some of the ways of overcoming those challenges, and some of the things you’ve done and the lessons you’ve learned.

Abinash Tripathy:

Sure. You know, I’ve been part of the Valley startup ecosystem for a while now, and you see this sort of cycle where the companies that want to be, sort of, B2C companies, you know, B2C is cool, and then there’s a slump in the Valley, with B2C valuation, and then you see startups gravitating towards enterprise. And I think we’re going through that right now and a lot of companies believe that they want to be enterprise companies, and to sell to the enterprise, as the focus right now is on making money and being profitable.

But having said that, I think enterprise companies, or enterprise startups that cater to enterprises - very different type of startup. So, take our startup as an example. We really focused on the very large customers from Day One. It’s painful to be in that kind of space because

Michael Krigsman:

Welcome to Episode 191 of CXOTalk! I’m Michael Krisgman. Today, we are talking about enterprise software, and how do you build an enterprise software startup? We talked with founders, we talked with VCs and entrepreneurs, and everybody wants to build for the enterprise, sell to CIOs, sell to lines of business across a company, but it’s really, really hard to do. And our guest, Abinash Tripathy, who is the CEO and founder of Helpshift, which is a startup that has managed to cross that chasm, and is successfully working with very large organizations. And so, we’re going to talk about enterprise software. As always, there is a Tweet-chat going on simultaneous with this live conversation, and so join us using the hashtag #cxotalk; and you can ask your questions of Abinash, and you can join the conversation!

So, Abinash Tripathy, how are you?

Abinash Tripathy:

Great! Thank you Michael for having me on the show!

Michael Krigsman:

Well, it’s awesome you’re going to be here, and you’re the CEO and founder of Helpshift, so let’s being by giving us a brief background about Helpshift.

Abinash Tripathy:

Great! Helpshift is an in-app customer service product. We built this product because we saw something that was changing in the environment. Consumers are using apps, employers and companies are using apps, and apps are becoming sort of the mainstay in the mobile era. And what we observed is that user behavior is changing as well, that people don’t want to be on the phone or email someone for customer service, but they want to engage in messaging-like behavior, which is very attuned to the mobile-centric world we live in. And, so we brought that paradigm into the app environment, and started working with very, very large brands like Microsoft and Supercell, who are sort of the leaders in the mobile space, and delivered the first mobile, in-app customer service experience and we have lots of customers now who enjoy the product every day.

Michael Krigsman:

So, tell us about the company in terms of how long have you been established, how much money you’ve raised, give us some of the vital stats about that.

Abinash Tripathy:

Yeah, great. So, we’ve been around since mid-2012; the middle of 2012. We didn’t have a product, we had a very small team; and we built the product, launched the product in the market in the middle of 2013, and then we’ve been selling the product since then. And basically, we’re a post-Series B-stage company, we’ve got 20 employees worldwide, and we’ve got lost of customers, and it’s a great feeling to be part of a company that’s really making an impact.

Michael Krigsman:

Abinash, as I said in the introduction, it seems like almost every startup these days wants to be an enterprise software company, and it’s not an easy thing to do. Can you summarize for us the challenges: Why is it so hard to sell successfully to the enterprise, and then, as we have this discussion, we’ll talk about some of the ways of overcoming those challenges, and some of the things you’ve done and the lessons you’ve learned.

Abinash Tripathy:

Sure. You know, I’ve been part of the Valley startup ecosystem for a while now, and you see this sort of cycle where the companies that want to be, sort of, B2C companies, you know, B2C is cool, and then there’s a slump in the Valley, with B2C valuation, and then you see startups gravitating towards enterprise. And I think we’re going through that right now and a lot of companies believe that they want to be enterprise companies, and to sell to the enterprise, as the focus right now is on making money and being profitable.

But having said that, I think enterprise companies, or enterprise startups that cater to enterprises - very different type of startup. So, take our startup as an example. We really focused on the very large customers from Day One. It’s painful to be in that kind of space because it takes a while to build a company, it takes a while to close these deals with these large companies: they have a lot of process, they want to do diligence, they want to make sure that you as a company can meet their needs and be there for the long term because they’re making sort of a long-term bet. So, the sales cycles are very long and you have to be very prepared to deal with companies like that and with longer sales cycles. And then, once you start building up your pool of reference-able customers, then your company starts to excel from a growth standpoint, because bigger companies or the bigger enterprises, the way they do business, is they look at who in their peer group you have on your logo board. So that’s kind of important. And as you build a lot of social proof that you are working with a bunch of enterprise-class companies, then your sales cycles get shorter, and your growth starts to accelerate.

Michael Krigsman:

You say that you built the company from the ground up thinking about the enterprise market. What did that involve?

Abinash Tripathy:

I think if you really look at the enterprise market and ask yourself what’s so unique about the enterprise market, the first thing is, that we all agree on, is that enterprise is really the definition that we give to companies that have attained a certain scale. So, scale is a very important aspect of doing business with them. So, when we started selling to our first customer, it was in the gaming vertical, and in the mobile space, gaming had the most scale, so some of the customers we worked with had in excess of hundreds of millions of daily active users, and some of our largest customers in the gaming space generate about forty to fifty thousand customer conversations, or tickets, per chat, so whatever you want to call them, every day. And, they service that number of chats with about two thousand agents sitting in contact centers around the world. And, that sort of scale is something that smaller startups don’t have to deal with Day One, because a lot of the enterprise-focused, or what I say B2B, startups focus on the sort of the long tail, Day one, And don’t have to work on these scale challenges. They’re usually working with companies that have about five to ten employees, a hundred contacts a day, and they build a solution towards that market, and then they can’t really go and address the scale needs of larger enterprises. Scale is a very important aspect of enterprise software.

The second one is really being very flexible when it comes to working on some requirements that may be very a enterprise, integration or compliance-oriented requirement. So when you work with very large enterprises, they may have their own internal systems that you need to integrate with, that are not standard off the shelf, or Valley-standard stack of software. So, you need to have great APIs, you need to have, really, the flexibility to work with those companies in order to build, sort-of, integrations into their systems.

And I also feel like the compliance requirements - that those could be daunting to a startup trying to work with enterprises, right? So, for example, if you’re trying to work with financial services, then PCI compliance becomes important, if you’re working with the healthcare vertical then HIPAA becomes important; and we were working in the gaming sector originally and COPPA was very important. You know, COPPA is a law that establishes the rules for service providers about collecting information from children who play games, or whatever. And so we have to implement sort of, these compliances in our product very early in our life cycle to deal with verticals like gaming. So, that’s another aspect of being flexible and being able to understand the need of the enterprise and being able to respond to it.

Michael Krigsman:

So, as you were starting the company, how did you get to the point where these large companies would take you seriously? Because you’re providing in-app help, and so a large company like Microsoft or a large gaming company has an app, a mobile app, and you’re providing the help infrastructure, so to speak, that allows users to interact and chat with that company to get customer service, and that’s pretty mission-critical for those companies. So, how did you get to the point where they were willing to trust you with that set of jewels? Obviously, it doesn’t happen overnight, so when you were at the early stages, how did you reach that point?

Abinash Tripathy:

Yeah, I think the key here is differentiation. If you went and created a product that just was a just a better customer service platform, and was sort of the red ocean, what, you know Bill Black, one of our investors likes to call it, the red ocean. Let’s say we were marginally better than the other customer service products out there, then we would have had a much bigger challenge in seeing these large companies; that they have to try this. But, what we did was we were the first in market with this in-app, native, mobile customer service experience that was modeled around chat, and nobody else did it, and we were able to convince large companies that this was a hugely differentiated service that customers would really enjoy.

So, our first large gaming customer, which was Supercell: they had the traditional, sort of very modern helpdesk that’s available, that most of the companies in the Valley use, and then they basically saw the differentiation and they saw how much better their customers’ lives would be to do it all in-app, inside the app, inside the game. And prior to this, the old customer service product they were using, the user experience was very poor. Basically, the users had to leave the game, they had to go online, on mobile phone, to a website that wasn’t even optimized for mobile, search for FAQs there, fire off an email ticket, and then come back to the game. So there was a lot of friction, and we got through all of that friction and showed Supercell that a user could just press one button inside the game and have access to customer service, and natively just like a mobile app on their phone. And that really got them thinking. They gave us the opportunity to trial our service inside one of their newer games because they were not willing to risk changing their workflow. They had a team that was about one hundred to two hundred people at that point, and they were not willing to change the system unless they were convinced that the value was not marginal. It was a huge step forward.

And so, that first pilot that we did with them proved that the experience was so much better, the users loved it, and so they made the decision to switch their entire support offering. In fact, they were one of the boldest customers because they went out and turned off email as a channel, turned off every channel that they had and basically made in-app customer service the primary channel for all their users.

Michael Krigsman:

But, how did you get them to trust you? I think trust is the key factor here.

Abinash Tripathy:

Yeah, so Supercell is a very, very interesting company. They’re one of the largest gaming companies, you’ve read about them in the press, they make billions of dollars every year from their four mobile games, and at the point they started with us, they were already a multibillion revenue stream company; so they weren’t willing to take big risks. But, because the experience we showed them was so powerful - actually, the way it all started was one of my sales heads, one of my sales cofounders, or one of the cofounders that had sales, basically nagged them for a demo, finally got to meet them at some sort of event, presented them with the experience, and they were sort of intrigued. And then, a few months later, their COO who was flying down from Finland, basically emailed us saying, “Hey, I’m going to be in San Francisco. I’m going to stop by your office, let’s talk.” And so, we were very excited, he came down to our office; and we sort of explained our company, our culture, and how we build products, and he was very intrigued and he said, “Ok, I’m going to give you an opportunity in one of our newer games without disrupting what we already have. And if you are able to prove in that game that you are able to perform and meet our expectations, solve all the pain we’re having with our current solution provider, then we will adopt you in all our games.” And so, that pilot ran for about three months, and once that pilot was done, basically the results were on the table for the company to make a very educated decision, and they decided to unplug their traditional CRM and move over entirely to Helpshift.

And that customer has scaled all the way from a few hundred agents to a few thousand agents, handling in excess of forty to fifty thousand contacts per day. When I say “contacts”, I mean real tickets or chats per day, and a lot of our larger customers have that sort of scale.

And once you close a big customer like that in the gaming vertical like Supercell, it basically draws a lot of attention to you from their peers. Everybody wanted to be Supercell in the gaming vertical, and so they were curious as to who we were. And we have our branding prominently in the SDK that we provide, so when people open up a Supercell game and and go to “Help”, they can actually see “Powered by Helpshift.” A lot of people noticed that, and they called us, and wanted to learn as to why we were better and how we were able to help a company like Supercell, and that sort of drove adoption in the gaming vertical.

And so of the first set of customers, the early adopters of Helpshift were mostly gaming customers, and really that made a lot of sense to us because if you look at the app ecosystem, the market we were going after, eighty - ninety percent of the revenue in that ecosystem is generated by gaming companies. Just to be a dominant player there, we got to work with some of the major thought leaders of the mobile space. The gaming industry by far is one of the most advanced when it comes to mobile. And we took all of those learnings, put it into the product, and now we can go after non-gaming verticals. We have customers in the e-commerce vertical like Target, we have customers in the productivity space like Microsoft, we have publishing customers like Flipboard, and we have media companies like Virgin Media, we have IoT companies like Honeywell and Suunto as customers, Wordpress.

So, basically we have gone beyond gaming, but I would say that the initial part of our life was mostly gaming. Gaming had a lot of scale, it taught us a lot about how to work with companies that had a lot of scale, and which is very important to the enterprise. And then we started to work with companies like Zynga, who for example, were using another traditional CRM system and moved over entirely to Helpshift. And, they had a lot of customs for API kind of needs, they had integrations to a lot of their backend systems, and with Zynga we learned how to build integrations into their backend systems and developed APIs. So, we met a lot of their enterprise needs there, and then we already had started working on COPPA and things for compliance.

And so, I think that the focus we had from Day One to go after large enterprises, gives you the opportunity...Actually, it’s hard, but it gives you the opportunity to go specialize. And when you specialize, it really shows.

Michael Krigsman:

And so, from the beginning, you specialized in the gaming industry, somebody made an introduction or one of your investors made an introduction, and they sort of tentatively adopted you, it worked, you grew it from there. And so you basically had an anchor foothold in the gaming industry, and from there, you were able to expand out. And during that early period, as you were going through that expansion, as they were trying you out, what kind of pressures or tensions did it create, or challenges did it create, inside Helpshift? Because at that point, you know, you’ve signed them up for a trial or a proof-of-concept, and you have to deliver, and then it only gets bigger. So, what kind of tensions, challenges, pressures did it create inside Helpshift at that time?

Abinash Tripathy:

I’m glad you asked this question, because when we signed on Supercell, we had absolutely no idea who we were taking on. This was the largest gaming company in terms of active users, probably the toughest of the toughest to deal with. And having them as your first customer, literally, if you could not respond to a customer like that, could be a company-killing event. So, we didn’t shy away from it, we took on that scale. It was incredibly hard, I still remember when they first brought on...so they were very satisfied with how we worked in their sort of, small new game. And the new game didn’t have a lot of scale, because it was the new game. And they had this giant game called “Clash of Clans” which is basically this, hundreds of millions of daily active users, and while we knew of the scale, our systems were probably not ready for that level of scale yet. When they first brought on Clash of Clans, when we first launched Clash of Clans, our servers were going down because we couldn’t handle the load. And I remember spending twenty days and nights with my engineers in the trenches, sort of keeping the system up, rearchitecting on the fly, adding capacity. We had to re-do a bunch of our software to meet that sort of scale. It's called “refactor” in the geek speak. We had to refactor a lot of code to make it work at that scale. And, I remember having a couple of conversations with the COO of Supercell, and he was like, “Hey, are you guys sure you can meet our volume?” And I had to convince him that we had it, that we could have it in a couple of weeks, we would be past all of that, and we would just keep scaling, and lo and behold, two weeks later our software just kept scaling. And so we’re holding billions of events every day on our stack, basically today we are handling in excess of three to four billion transactions per day on our servers; and thanks to Supercell we were able to do that, and they gave us the opportunity, they were willing to be patient, they gave us a little bit of time, we were able to respond in that time; and then once we proved to them that we were able to solve these really hard problems, we really became very deep partners with them.

And that partnership - and this is another, sort-of lesson of working with large enterprises. So, we have weekly calls with Supercell’s team. They have thousands of agents, use our system, so obviously they’re the most demanding customer we have. We don’t put them through the normal support process of raising tickets and issues with our company, our support managers talk directly with Supercell on a weekly basis, we take inputs from them on what’s working, not working, input that directly into product and respond very quickly. And, we have quarterly business reviews with them, they come to our location once or twice a year, we go to Finland once or twice a year, and we work on joint roadmaps.

And so, it’s very different from working with small enterprises, where, in the SMB space, a lot of the service providers don’t even meet their customers, or have phone calls with them. They just email them, or Slack them and that’s about the contact they have. But when you work with these large enterprises, they really are true partners in a very, very partnership-oriented sort of mode.

Michael Krigsman:

What about the sales cycle? So, for example, so it sounds like the sales cycle originally for Supercell was pretty straightforward, because you had that introduction. But, a startup having to deal with RFPs and RFQs and having to travel to meet decision committees, that often large companies have in place, and the sales cycle can be three months, six months, nine months; can be a year. As a startup, how did you manage that aspect of it?

Abinash Tripathy:

Well, I mean if you’re selling to the enterprise, and you’re consciously building an enterprise to sell to the enterprise, all of those things are a given. You have to do those things to be able to sell to an enterprise, including the long sales cycles. So, fortunately for me, I started my career in 1995 Silicon Valley, and I was working for Oracle, where in my early days, I learned how to sell to very, very large enterprises. And from there, I went into extreme, sort of enterprise selling and I was part of a startup that invented WAP, and we put mobile browsers and mobile features back in the days when we had those feature phones - those flip phones. And, we used to work with telcos, which was an extreme level of enterprise sales. So, selling to large enterprises is one level of complexity and selling to a telco is sort of a next level of complexity.

And, so, having done that for many years, I think it’s important to have that experience. If you don’t have that experience in the Valley and you’re trying to build an enterprise company, you won’t see the value of working with these companies, being patient, and investing up-front to go work with companies of that size, and you’ll always go after what’s easy. So you see a lot of these B2B companies in the Valley, they do what’s easy. They’ll go after small companies - five, ten person companies - that don’t have a lot of complex requirements, and build for them. Then they find that it’s really hard to move upstream, and go sell to the enterprise.

And, you know, there’s a reason why Salesforce is Salesforce, and Zendesk is Zendesk. They’re two different-sized companies, from a revenue and size standpoint, and they probably have an equal number of customers, right? The revenue difference is 5 - 10x, right? Because one sells to very large enterprises, and the other one sells to sort of, you know the long tail.

Michael Krigsman:

What is the advice that you have towards startups who want to sell to the enterprise, but they look at these long sales cycles; in many cases, getting introductions is hard. But once they have an introduction and the sales cycle, the need to invest is very, very difficult. It’s just that delay, that time, is so expensive for a startup and it’s cash that they don’t necessarily have and time that they don’t necessarily have.

Abinash Tripathy:

Yeah, so for companies that sell to the enterprise, the scaling and the growth is slower than those selling to the SMB, initially. So, let’s say you take two companies: one selling to the SMBs and the other selling to the enterprise-sized companies, and they start their journey at the same time. Chances are the SMB-focused company will scale much faster than the enterprise-focused company in the initial years, right? And, so after the three-four year mark, it looks like the SMB company is ahead. But then, once that market starts to peak out, or, you know, bottom out, and it happens very rapidly in those sort of SMB segments where you run out of all the SMB that company can sell to, and then you make the decision to go up-market, and then your product is nowhere near close to being up-market at that point. Literally any company… I haven’t seen a single SMB-focused company become a successful enterprise company. I haven’t seen any examples of that. Nor have I seen examples in the reverse where you see enterprise-focused companies being really good at selling to SMB. I think they’re two separate markets, they’re two separate needs or requirements, and different types of companies will cater to those segments.

That’s really…So, the biggest thing, coming back to your question, which is “What do you really need to do to be an enterprise-class company?” The first thing you need to do is you need to know that you are building a long company, or a long-term company. Basically, you need to go find patient investors, investors who have the patience to build a longer-term, enterprise-class company, and are not looking for that SMB, fast-growth kind of model. So, it starts with picking the right investor. In the Valley there are those investors that really want the rocket ship, B2C-style, no-sales kind of companies. They basically tell a founder, “Oh, you should not have any salespeople at all, it should only be inbound marketing,” so there’s investors that prefer that. And then there are investors that believe that, “You should start working with large enterprises. It’s going to be slower. Build an outbound team.”

And the two types of companies are very different. If you’re looking at the SMB companies, they’re investing a lot of dollars in marketing, in digital marketing, and not as much in sales. And you look at enterprise-focused companies: less dollars in marketing, more dollars in BDR [Business Development Resources], outbound, inbound, having account reps and inside sales. Very different models, right?

Now, the other thing I’d like to add is if you think about how we grew as a company, before we built our sales, the BDR, SDR machinery, the first thing we invested in was customer support and customer success. Because, when you work with enterprise customers, they are big brands, and you don’t want to fail them, so you want to make sure you have the best customer support and customer success teams in place to handle these big accounts and make them successful, and they become case studies. They go around to the world telling them how good you are as a solution provider, and then companies in their class come in, inbound. And when that engine starts to work, it’s very powerful.

Michael Krigsman:

So the focus, then, requires patience, and you begin with having a customer success team. And I’m assuming at the very beginning of the company, everybody is focused there, but quickly; and it sounds like you kind of specialized in having a customer success team, in order to make sure that the enterprise customers you’re selling to, were just delighted with everything they were getting from Helpshift.

Abinash Tripathy:

Yeah, and initially when we started, the founders… and actually I just want to correct you: Supercell we didn’t win because our investors made an introduction, we won because our head of sales cofounder was extremely persistent, and he was a true hustler that went and literally stalked Supercell at events, and somehow got a meeting with some of their people. So, it was pure hustle that basically got us Supercell as a customer. And after that, it was a lot of keeping those customers really happy and engaged, and that happened. So, before we built out the success team, the product team, which was headed by me, and the engineers, we made sure that Supercell was a massive success. And then as we brought on bigger customers on that scale, we built out our customer support team first, before we started building out our SDR, BDR, AE teams.

Michael Krigsman:

That’s really interesting. So, you found your first big customer purely on the basis of intense hustle, and then you made sure they were really happy.

Abinash Tripathy:

That’s right.

Michael Krigsman:

So, what about building up inside the company, what kinds of people did you have to hire? What was the background of the folks that you brought into Helpshift as you were growing in this enterprise domain?

Abinash Tripathy:

Yeah, so, if you really think about what kind of people we need, we needed customer success people, we needed a lot of SDR, BDR AEs who had done this before at other SaaS companies. So, when we hire in San Francisco into our sales and marketing teams, and our customer success teams, we look for people who have relevant selling or customer success experience in peer-group companies. So, when I say “peer group” companies, we would typically hire somebody who’s left either Box or Salesforce than somebody who’s worked at Zendesk, right? Because you deal with a different class of customers when you come from sort of peer-group companies. So, a lot of our initial people are people who left Salesforce, or Box, or those types of companies.

Michael Krigsman:

As you were going through the sales process, and I’m so focused on the sales process because that’s really what everyone cares about, how much of your selling back then, and say today with your customers well-established, how much of it is based on referrals and relationships in terms of how you do your business development today?

Abinash Tripathy:

Well, I would say a lot of it. If you look at people who sort of work in big companies, they move around every two years or three years. And, if they have a positive experience with a vendor, they take that to their new workplace, to their friends in peer companies. So a lot of our customers today are referrals from existing customers. And also, the bigger companies go through an RFP process, and in the RFP process, you typically have to provide references to companies that are of similar scale or of similar size. And these references are critical to closing these deals. And, when you start building up a base of these types of customers, I would say a referral in selling is very important, reference selling is very important, and it works well for a company that’s in the enterprise category.

Michael Krigsman:

Now today, Microsoft is one of your customers, and you provide the in-app, the chat or customer service inside the very important Microsoft apps. So can you tell us, what are you doing with Microsoft? How did you get that relationship going, and frankly why did Microsoft decide to go with you rather than develop the capability in-house, which, I mean, they could do that if they wanted to.

Abinash Tripathy:

Oh yeah, excellent question Michael. So, Microsoft is on such a great trajectory right now, and they’re willing to look past what they’ve built internally, they’re just willing to do the right thing for the customer. But, our story of Microsoft goes as follows. So, we started working with a small company called Acompli which basically got acquired by Microsoft, and is now Microsoft Outlook. And, one of the cofounders of Acompli, Kevin Henrikson, was a colleague of mine at my previous startup, at Zimbra and at Openwave. And, so I started working with Kevin when he first put the Acompli product out, and he was very far-sighted and he said, “Look, even though we’re an email client, I see the value of doing this in-app, and I really want to be able to iterate and to build our product really fast in collaboration with our customers,” when they were really small. And, I see this whole app thing as a very powerful thing, and he adopted Helpshift and put it in the Acompli app. It truly helped Acompli succeed, which eventually led to their acquisition by Microsoft and then becoming sort of the Outlook client on mobile, because they were really able to take advantage of the in-app chat capabilities and iterate on their products very fast. So, they would put out a build every two weeks, and in that two weeks, they would basically take all the input from customers, optimize the app, and put it out in the app store; and they really built a science around this.

And, when they became acquired by Microsoft and they became Outlook, there was obviously pressure from Microsoft to abandon a third-party product like Helpshift and move to an internal product, right? And so, a lot of products inside of Microsoft were already using existing products that Microsoft had, which were products that Microsoft had built, it’s not even products that were third-party products.

So, Microsoft owns another customer experience company called Parature, which Microsoft bought for a lot of money, and Parature was being used by a lot of productivity groups inside of Microsoft, and but Kevin basically was able to convince the Microsoft peers that, “Look, in-app is where it’s at, Parature was not in-app, Parature was still trying to drive customers into email as a channel,” and then; more than in-app what they really saw for Acompli is that because we’re embedded in an app, we could take all the information about a user inside the app, and pass it seamlessly to the cloud that the company can then have a view into. And we called that “telemetry”, right? So, that telemetry was so vital to provide a great customer experience to the users that basically, Kevin was able to convince all of his peers that this was the way to go. In fact, Microsoft then became an investor, so they participated in our Series B round, which closed earlier this year, and they are an investor in the company as well as a customer.

And so, we’ve expanded our relationship beyond just the Outlook mobile client. We’ve built desktop SDKs now that work on Windows and Mac, and now Helpshift is going to be their in-app service provider for their desktop applications, for their Microsoft Outlook, for desktop Office, so we’re working on a path with Microsoft to sort of get Helpshift embedded in all of their mobile and desktop product lines. And so, I’m just so fortunate to have colleagues or friends like Kevin who had the foresight, who had the ability to go prove to the world that the better solution has to win, convinced Microsoft internally that indeed, Helpshift is a better solution.

Michael Krigsman:

So, with Microsoft, you’re talking about embedding Helpshift technology, customer service technology within Microsoft desktop apps, like Office.

Abinash Tripathy:

That’s right. So, we’re working on a path right now to hopefully embed Helpshift into the desktop apps.

Michael Krigsman:

Obviously, that’s incredible. That’s just (Yeah.)

Abinash Tripathy:

And then you have to think about the fact that Microsoft has two very large CRM products, one is Dynamics and one is Parature, in-house. And yet, they use Helpshift.

Michael Krigsman:

Yeah, that’s pretty amazing. So now you’ve got kind of this relationship going with Microsoft. What does that mean internally at Helpshift in terms of how you organize the company? So, you obviously have a product that was a great product, great technology, and you somehow got it into their hands through a combination of relationships and hustle, and they bought it, and you did all the things that were necessary to keep them happy, to keep that huge enterprise customer happy. And now, you’ve got to organize the company internally inside Helpshift to have the right kind of customer relationships, and support for those relationships, management of those relationships. And so, how do you do that? How do you organize for the deep enterprise relationship?

Abinash Tripathy:

Yeah, it’s very hard, right? So, especially when you’re in a startup environment and you’re working with a lot of young people on the engineering side who haven’t really had a lot of enterprise experience. When they get asked to do things that are unreasonable for some reason, right? So, you know Microsoft for example, to work with them, one of the first requirements that we had was that all of our infrastructure was hosted on Amazon. And you know, Microsoft basically said that if you want this massive contract from us, you’re going to have to host at least Microsoft Tenant on Azure. And so, we had to go push our team internally, and basically have two deployments. So, we had an AWS deployment for most of our customers, and then we had an Azure deployment that we manage. And, so all these things you have to do, there’s things around security, there’s things around privacy, there’s things around data storage, right? And there are so many compliance things you have to do with enterprises.

And it’s so frustrating with young engineers to be able to not work on cool features but to work on these boring, sort of compliance kind of things. So you really have to go and have a massive selling inside your organization — to your teams — to explain the value of working with these large customers and do things that may seem boring on the surface, but have huge payoffs in the long run.

And, just to give you an example, the work we did with Azure, it’s incredible! So, initially, as a company, as a startup, you’re like, “AWS is, like, incredible,” and we always looked at Azure as this thing that’s kind of new and maybe not as good. And what we learned in our experience of deploying on Azure was that Azure was just as good, even as good as deploying on Amazon. And maybe we'll get better cost efficiencies with Azure. And now we’re hoping to put a plan together to try and move most of our infrastructure to Azure, right? So, there’s a lot of learnings that come out of large enterprises, and you just have to be open, flexible. The biggest challenge is really getting your team completely aligned with the enterprise focus, right — you know getting your young engineers to see the value of working with these big companies on things that may not be very cool.

You know, that’s the thing. In the Valley, the engineers in younger companies want to work on the next cool thing, and for enterprises, you have to go solve really hard problems that may not be cool, and that earns you the right to do business with all of these companies.

Michael Krigsman:

So, we have just a couple of minutes left, we’re just about out of time. But we have an interesting question from Twitter from Arsala Khan, and maybe you can answer this very, very briefly. So, Arsalan Khan asks: When you were starting out, or when an enterprise company is starting out, how good or useful is social media to help create that initial buzz, or in helping you establish relationships that will lead you to customers? So very, very quickly.

Abinash Tripathy:

So, social media is kind of important, but not super important. So for B2C or sort of, long tail - focused companies, social media is more important than for enterprise-focused companies.

Michael Krigsman:

And, the last thing that I want to ask you and again, pretty quickly because we’re just about out of time: Out of all of this, what is your advice, your best advice for startup founders who are wanting to sell to the enterprise, and they’re at an early stage. What’s your advice on how to get to the point that you have reached with Helpshift?

Abinash Tripathy:

Yeah, I think my biggest advice is if you don’t have a cofounder that has worked in the enterprise category or space, selling or in BD, then go get one. You really need a person that understands what it takes to work with enterprise companies. That’s the first and foremost requirement. And, the second one is to find patient money. If you really want to build a long-term enterprise company, you going to want a VC that is patient and knows what you’re going to be doing, and it’s going to take some time, and is willing to work with you and help build the company. And so, patient money is really important. I think those two things, if you’ve got people who really have the experience that you need for enterprise, and you have patient capital, then I think you’re on your way. It’s not that those problems can’t be overcome, it’s that those are the two things, the foundational elements.

Michael Krigsman:

So, enterprise experience and patient investors who understand what the enterprise sales cycle and process is like.

Abinash Tripathy:

Correct.

Michael Krigsman:

Fantastic! Well, this has gone by very quickly. We have been talking with Abinash Tripathy, who is the CEO and Founder of Helpshift. He has been explaining what it’s like, what are the challenges and solutions for building an enterprise software company; an enterprise software startup. Abinash Tripathy, thank you so much for joining us!

Abinash Tripathy:

Thank you, Michael.

Michael Krigsman:

And, everyone, thank you for watching CXOTalk Episode 191 and we will see you again next week. Bye bye.