Stuart Chaney’s Post

It's amazing how quickly the pendulum has swung in #ecommerce... When I first stumbled into the Shopify ecosystem in 2017, specialization in SaaS was the name of the game, with the pendulum moving away from all-in-one solutions. They were clunky, limited, basically jack-of-all-trades and masters of very little. And they were pricey. The reaction to this was to move to specialization. Use the best tool for each feature you need; reviews, pop-ups, email, loyalty, UGC, etc. For a good ~10 years we saw these products dominate their categories, reach huge valuations, and many of them sold at a great time. Fast forward to today in just under a decade and in a very different economy, these standalone apps are no longer considered businesses to many, but features. Features that can easily be replicated by bigger players to add to their suite of products. And they have no moat to defend themselves when it is a race to the bottom on price. With the markets where they are, budgets and resources are tight. That means less time and $$ for 25-50 different apps to manage, keep track of, and use all of the features available. These 'suites' of apps are now much more appealing to a smaller marketing team that has less time to bounce around and use every bell and whistle under the sun. Furthermore, there is a data centralization play to capitalize on when keeping everything under one roof where it was previously unlinkable between apps-apps that had tons of customer data in each tool. It's been amazing to see this evolution in such a short amount of time, and makes me wonder how long it will be for the pendulum to swing back. Until then, buckle up for an interesting ride these next few years. We're going to continue seeing more competitive overlap in these suites of tools that were previously strategic partners. Product suites are the new moat and path to longevity. #partnerships

It took 11 PAINFUL months to grow my bootstrapped SaaS startup Rivo from $1,000,000 to $1,500,000 ARR. Here are the 4 biggest mistakes I made that slowed down growth while moving from SMB to Mid-Market in the Shopify app ecosystem. CONTEXT: There is a jarring difference between the SMB and mid-market in the Shopify ecosystem. At times, it’s felt like starting a whole new company. Lots of these mistakes come from being enthusiastically naive and not doing enough research before diving in. 1) Not seeing hidden moats "Hey, look at this big Shopify app - they suck, they’re super expensive, and the product is barely updated anymore. We should just build a competitor and charge 50% as much" This might be all true... but what you CANT see in this scenario, is that the big competitor has 10+ years of deep-rooted relationships with agencies and brands across the ecosystem that make the buying decisions. You can absolutely break these, but if your product is not 2x as good as the incumbent - you're going to be pushing a boulder up a hill, wondering why things aren’t working. It took me at least a year to understand how tight-knit and relationship-driven the mid-market really is. 2) Switching costs are 10X more than SMB From my experience, SMB brands are much more likely to replace an app if they can get a similar product that costs 50% less. Brand loyalty doesn’t really exist in the Shopify app store funnel. Brands on Shopify Plus aren’t looking to save $10K by switching to your app. It’s not worth the time and hassle of onboarding your product. If you can instead show them how your superior product/service will generate another $250K+ or greatly improve the customer experience, then you are in the convo. 3) TAM is much smaller than expected There are over 4M Shopify stores, but in my experience, the TAM of stores that will pay an ACV of $10K+ is around 0.005% of that number (~20,000 stores) This is especially true in 2024 as the price of SaaS in the Shopify ecosystem folds over the next 12 - 24 months. I can account for around at least $100M+ ARR in the ecom loyalty & referrals space across many competitors so this isn't an issue, however, the landscape is ultra competitive with a high number of vendors fighting for a very small pool of customers. 4) Importance of brand building This is where I really dropped the ball in the first year. I wasn't quick enough to shift from the transactional mentality of SMB to a mindset where most of our customers aren't actively in the market for our product. The brand we build in the meantime is how they'll remember us if/when they eventually need our solution in 6-12 months. TAKEAWAY: Most of the last year has been frustratingly slow as we were still figuring out the GTM upmarket. We've finally hit traction where the numbers are starting to add up now. My only regret was not spending enough time to truly understand the mentality/rules of the new game before making the switch.

24 months ago, I quit my $4M ARR bootstrapped SaaS business focused on SMB Shopify stores and moved upmarket with Rivo. Here are my 3 biggest takeaways on moving to the Mid-Market in ecom Saas: 1. It is much, much harder than I expected. - The difference between Mid-market and SMB is like chess vs checkers. - I thought this would be hard, but I massively underestimated just how hard this change in GTM strategy would be. - I expected us to be at around $2M at this point, we're at 60% of that right now. It's slow and steady which is fine, but looking to change that starting Q1. 2: I thought we could have utilized more of the SMB playbook. - We switched from a low-touch, high-throughput model to a high-touch, low-throughput model and everything had to be built again from scratch. - The automated customer journey flows we relied so heavily on are now manual outreach and 1:1 account-based handling. - The app store was our main acquisition channel. I've detailed this in other posts, but the app store just doesn't move the needle in the mid-market. In SMB this was 90% of the GTM. Now it's < 10%. 3. Brand and relationships are king. - We spent too much time thinking that building a better mouse trap (product) would make brands switch from the incumbents in the space. - With SMB, the brand means way less. It's a commodity game. People pick the first or second result in the app store listings and make buying decisions within minutes or hours. - We didn't really find out how the game is played for the first 12 months. Brand building, going to events, tech and agency partnerships, and building real relationships with others in the space, to name a few. Thankfully we've done a lot of other things well that have helped get us to where we are today while making lots of mistakes along the way. Focusing too much on product is a good mistake in the long run. Feel free to AMA in the comments.

After 21 years across GearTrade, Doba, and Dsco (plus last 3 yrs on break) I am convinced that the S of SMB (from the perspective of the entrepreneur/solution/tech co) doesn't stand for Small. It stands for Suck-ass. As in that customer group will suck you into incredible needs of product and support, as much if not more as actual enterprises, and at the same time complain about paying more than a pittance for it. Their behavior is Consumer (emotions), not Business (rationality and ROI) If you're going to pour blood sweat and tears into building something to sell to other companies, make sure they're actually companies. My advice (Jared Ward has heard this!): MINIMUM pricing: $12,000 per year. And up from there. If you can't charge that, the problem isn't big enough and/or you haven't found big enough companies with the problem and/or you haven't done the hard work of presenting ROI and are WAY underselling yourself. Don't let pretend businesses derail the heavy lift you'll need to do to build something decently interesting.

🚨 Free Knowledge Here 🚨 So... I'm a little bit weird. Built differently... As part of that I'm more than happy to share heaps of knowledge in places that Ethical Bedding competitors can get their hands on it and execute on it. But I'm safe in the knowledge that: 🫂 People: They won't do it as well as our team do it 🛌 Product: Our products will always be better than theirs 🖤 Brand: Our brand will always be stronger than theirs My working assumption is that everything will approach a point of shopping singularity within 10 years from a technological viewpoint. So what does that translate to practically for Ethical Bedding? 🌐 We don't go first on any apps or fancy new tech, because my assumption is that Shopify will absorb and improve anything that's worthwhile (e.g. we always fast-follow) 🏆 Increased importance on the 'foundations' of business: People, Products and Brand (e.g. things that cannot be easily replicated but give us a competitive advantage) 👍🏼 Increased importance on building community via as many channels as possible (e.g. all social channels, email, SMS, podcast) 😍 Increased importance on delighting our customers at every touch point, building an incredibly strong connection and affinity with us 😎 Being different, a little bit weird, and standing out from the crowd is more important than ever. That doesn't mean ignoring ignore excellence in the BUA, but being memorable is THE single best differentiator that we have ♾️ Do not ignore channels which drive longtail value, particularly touch points used by tomorrows shoppers (e.g. TikTok) I say this a lot internally, but this is a long game... In the history of humankind it's never been easier to build a super cool brand that changes the world. Easy peasy. ✌🏽✌🏽✌🏽 Full list of Shopify updates for Summer '23 here: https://lnkd.in/ekEeUGuK 🤔 What in particular caught your eye in the recent Shopify Summer '23 updates? 📝 Comments below please! #brandstrategy #brand #brandbuilding #ai #shopify #shopifytips #shopifystore #shopifytips #sharingknowledge #ecommerce #ecommercetips #futureofcommerce #founders #startup #scaleup #freetips

When I sold my last business, a service marketplace, the buyers said: “Jon, what you’ve built here is basically a video game.” Exactly. Game mechanics on marketplaces keep motives aligned. Game mechanics within a marketplace means rewarding good behaviour, preventing and penalizing negative behaviour with a set of rules and force functions, wrapped in good UI. This combo helps incentivize and ensure both sides of the marketplace (supply and demand) behave, and understand exactly what’s required to optimize the experience ie earnings or value. When you’re the marketplace admin, transparency around exactly which elements users are rewarded/not rewarded with (ie how the algorithm works), you get way more users rowing in the same direction. You will always need to watch for the ones that try to “game” your systems to their advantage, but these are usually good opportunities to learn, patch and improve. Also if someone is gaming something you’ve built…that’s pretty good validation of value. Solving for marketplace disintermediation is one of the most interesting business challenges I’ve ever tackled. You’ll often hear me sharing my ideas (unsolicited advice) to help Shopify with their app, theme and expert marketplace. 👀 I’m excited to start implementing more of these ideas in my next marketplace startup AppStoreResearch - thousands of ecommerce brand owners and operators are sitting on an monetizable asset many don’t even realize they have yet…knowledge. We want to help surface and extract this knowledge to help ecommerce saas teams build world class sofwatre people love and want to use. If you’re building a marketplace - let’s connect. I can share examples of these mechanics and maybe learn a trick or two from you. #marketplaces

Before I joined them to run growth, I was a Platter customer. I thought I was an edge case but now I’m seeing a huge potential in a particular customer profile: Operators or groups that manage multiple (or many) brands 🔢 At the ecommerce incubator I was at, we were creating a large volume of new consumer concepts to test and validate. Like all innovation funnels, we started with a large volume of ideas and whittled it down to the best ones, using consumer research and performance to isolate the concepts with the most demand potential. For every idea, we were spinning up new Shopify storefronts. Starting from scratch for each one was time consuming, expensive, and complicated. It was frustrating and the process didn’t scale. Off-the-shelf themes required too much customization. Good agencies were expensive and took a long time to ship. Getting an entire stack of apps approved by procurement would take ages. Then I heard about Platter (then called Smart Theme) on a podcast when Nik Sharma said that it’s a great option for new brands. The value prop hit immediately. Get one solution approved, empower non-technical teams to build the store, and get all of the conversion features I could possibly need out-of-the-box. All for a fraction of what it would have cost to use the alternatives. I reached out the same day and we were able to stand up the first store with Platter 3 weeks later (and we definitely could have shaved one whole week off of that). Then the storefront was templatized. We could be 80% of the way there on day 1 of spinning up a new brand to launch, and be able to quickly customize the remaining 20% without relying on developers or 3rd party apps. A couple months later, I pinged the team and asked what it would take to come lead growth for them. I joined the team a few weeks later. If you’re an operator, incubator, roll up, holding company, or just manage multiple Shopify stores - we should talk. There is a way to reduce complexity and save you thousands of hours and hundreds of thousands of dollars in storefront management. All by switching to Platter.

Fascinating to read what a VC thought of #shopify 13 years ago.. how the #ecommerce world has moved on. Shopify’s largest customer had $10M GMV 🐭 "Volusion is perhaps the most formidable competitor" 😂 "Roughly 20% of customers sign-up via referrals from web design firms. Until Shopify had setup a data warehouse, they didn’t know how crucial their web design firm channel could be for growth". How data analysis helped them find the best channel 💡 Tobi's cofounder sold his 10% share for $2M 😳 (would be worth $8BN now) But then expectations were low. The companies shareholders didn't think it could top $50M valuation, and the valuation assumed 2.5x ARR - which is absurdly low even in today's depressed markets. Shopify did have high churn (5% logo churn monthly), but low CAC. Luckily the investors recognised the power of the nascent app store, and history was made. https://lnkd.in/eRN6QaT5

well done

Convertcard made $1M in their first year. Completely bootstrapped 💰 What's Convertcart? 🛒 A tool that makes growing online businesses easy. What are they solving? 🤔 1. Conversion rates for e-commerce. 2. Engagement of users. How are they solving it? 💯 The platform goes into any e-commerce site (think your Shopify/Amazon store), finds where you lose customers & revenue, and plugs those gaps. What's the right to win in the category? 🎯 For all their users, 50% of the conversion rate-related problems (think product discovery, checkout) have their solutions generated by Convertcart's learning models. Suggestion for an early founder 🧠 Don't crack every problem from scratch & lose your sleep over it. There are 8 billion people on earth. There have been 100 billion who have lived before us. There's so much wisdom they've written. Make reading your friend. And, they're on a winning spree 👑 Made their first $1M bootstrapped, fully outbound. Made their second million with little to no funding. They've been profitable for the past 18 months. And, are en route to their $5M journey. Shekhar is a bar-raiser for the Founders Circle at GrowthX®. An exclusive club of founders that made $150M in revenue last year. PS: this quick video is part of founder-centric series we are building at GX. Stay tuned for more such hidden gems 💎