Scaling Operations in the
Subscription Economy
A COO’s Perspective
Bryan Tookey
Chief Operations Officer
Brandwatch Agenda
1.  Brandwatch Introduction
2.  Operations at Brandwatch
3.  Measuring success
4.  Operational challenge...
Brandwatch: we
analyse social
media
•  130 employees
•  5 offices
•  750 customers
•  $1.2m+ monthly revenue
•  100%+ y/y growth
In Brandwatch “Operations” means…
Boring stuff?
…not sales, marketing or product
Make it better
Why not p#$%
off and sell
something?
KPIs
Support
Billing
Proces
s
Services
Right	
  gents, AOB?
Operations covers a lot of topics
Finance
HR and
Legal
Set up
Sales	
  
22% of Brandwatch Staff are Ops
HR, Legal, Office (4)
F I N A N C E A N D M I I S S I G N I F I C A N T , B U T ...
£0k
£100k
£200k
£300k
£400k
£500k
£600k
£700k
£800k
£900k
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
Jan-10
Mar-10
May-10
Jul...
Zuora has improved BillingE R R O R S C A U S E D B Y C O M P L E X I T Y / F L E X I B I L I T Y
28 28
10
18
26
29
25 23
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
KPIs
Insert	
  chart	
  on	
  sa,sfac,on	
  rates	
  and	
  speed	
  of	
  
response	
  
0.00	
  
0.50	
  
1.00	
  
1.50	
...
Support: hard to scale
2 4 H R A N D M O R E L A N G U A G E S I S E X P E N S I V E
750 customers
c. 40 requests (tickets...
Clients demand ServicesG R O W T H O F B R A N D W A T C H S E R V I C E S O F T I M E
23%
20%
31% 32% 31%
34%
37%
35%
38%...
HR and Legal: from…
You can’t do
that Sign up to our
standard Ts &
Cs
HR and Legal: to…
Happy and
motivated
staff
Let’s negotiate
the Ts &Cs
Ourstrengths…
$
PRICE	
   ACQUIRE	
   BILL	
   COLLECT	
  
NURTURE	
   ACCOUNT	
   MEASURE	
   ITERATE	
   SCALE	
  
Somechallengesremain…
$
PRICE	
   ACQUIRE	
   BILL	
   COLLECT	
  
NURTURE	
   ACCOUNT	
   MEASURE	
   ITERATE	
   SCALE	
...
Reasons why…
Acquire:	
  
Complex	
  
product	
  
Bill:	
  
One	
  offs	
  
Collect:	
  
Enterprise	
  
Customers	
  
Nurtu...
What it all means
R U N N I N G O P E R A T I O N S I N A S U B S C R I B E D B U S I N E S S
•  A subscription company ca...
Thankyou
Photo	
  AGribu,on	
  
Slide	
  6	
  Gargoyle	
  1:	
  by	
  Julian	
  Fong	
  	
  
Slide	
  7:	
  (sales	
  and	
  produc...
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Scaling operations in the Subscription Economy (Brandwatch)

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As the leading social monitoring brand, it is essential that Brandwatch demonstrate that they are listening to their own customers’ needs. A company who are deeply committed to innovation with 40% of their workforce dedicated to improving their platform, Brandwatch have demonstrated that by managing their subscriptions on Zuora, they are ahead of the curve in all areas, offering intuitive and flexible pricing models to suit their diverse customer base. Since migrating to Zuora, Brandwatch’s customer focus has allowed them to accelerate their expansion from 78% year on year growth to 118%.

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Scaling operations in the Subscription Economy (Brandwatch)

  1. 1. Scaling Operations in the Subscription Economy A COO’s Perspective Bryan Tookey Chief Operations Officer
  2. 2. Brandwatch Agenda 1.  Brandwatch Introduction 2.  Operations at Brandwatch 3.  Measuring success 4.  Operational challenges in the Subscription Economy
  3. 3. Brandwatch: we analyse social media
  4. 4. •  130 employees •  5 offices •  750 customers •  $1.2m+ monthly revenue •  100%+ y/y growth
  5. 5. In Brandwatch “Operations” means… Boring stuff?
  6. 6. …not sales, marketing or product Make it better Why not p#$% off and sell something?
  7. 7. KPIs Support Billing Proces s Services Right  gents, AOB? Operations covers a lot of topics Finance HR and Legal Set up
  8. 8. Sales   22% of Brandwatch Staff are Ops HR, Legal, Office (4) F I N A N C E A N D M I I S S I G N I F I C A N T , B U T M I N O R I T Y Support (5) Set-up (7) MI (1) Finance (5) Consulting services (7) Total 29 (out of 130, 22%)
  9. 9. £0k £100k £200k £300k £400k £500k £600k £700k £800k £900k 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 All staff Index) Operations staff (index) Monthly revenue How operations has grown R E V E N U E , H E A D C O U N T A N D O P S G R O W T H Under invest as limited resources Over-invest to fix processes Enjoy benefits of scale Increased enterprise customers
  10. 10. Zuora has improved BillingE R R O R S C A U S E D B Y C O M P L E X I T Y / F L E X I B I L I T Y 28 28 10 18 26 29 25 23 20 10 15 15 14 13 16 0 50 100 150 200 250 300 350 400 - 5 10 15 20 25 30 35 Numberofcustomersinvoiced Numberofcreditnotes Invoice date Also: fewer invoices per customer + faster invoicing + lots more flexible options Post-Zuora: on average we issued corrections to 5% of invoices Pre-Zuora: on average we issued corrections to 9% of invoices
  11. 11. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   Revenue  Index   Staff  Index   Ops  staff  Index   KPIs: we use Bessemer’s SaaS metrics
  12. 12. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   All  Staff  Index   Opera,ons   MRR Are we selling enough?
  13. 13. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   All  Staff  Index   Opera,ons   MRR Pipe Will we grow
  14. 14. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   All  Staff  Index   Opera,ons   Cash flow Will we run out of cash?
  15. 15. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   All  Staff  Index   Opera,ons   Churn Do my customer hate me?
  16. 16. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   All  Staff  Index   Opera,ons   CAC (Customer Acquisition Cost) Are my sales team too expensive?
  17. 17. KPIs Insert  chart  on  sa,sfac,on  rates  and  speed  of   response   0.00   0.50   1.00   1.50   2.00   2.50   3.00   3.50   1   3   5   7   9  11  13  15  17  19  21  23  25  27  29  31  33  35  37  39  41  43   All  Staff  Index   Opera,ons   CLTV (Customer Lifetime Value) Is it all worth it?
  18. 18. Support: hard to scale 2 4 H R A N D M O R E L A N G U A G E S I S E X P E N S I V E 750 customers c. 40 requests (tickets) per day 14 hours support, 5 days a week 2 languages (EN and DE) except Portal (EN only) 2.5 1st line Full Time Equivalent employees 1 second line FTE 1 FTE for support materials 1.25 FTEs for training (EN, DE) 2013 1300 customers c. 70 requests (tickets) per day 24 hours support, 5 days a week 5 languages (EN/DE/CN/ES/FR) including Portal 10 1st line Full Time Equivalent employees 2 second line FTE 1 FTE for support materials + 4 freelancers 3 FTEs for training (EN/DE/CN/ES/FR) 2014 2x revenue 1.7x customers Up to 4x costs
  19. 19. Clients demand ServicesG R O W T H O F B R A N D W A T C H S E R V I C E S O F T I M E 23% 20% 31% 32% 31% 34% 37% 35% 38% 8% 9% 14% 13% 19% 21% 21% 9% 22% 0% 5% 10% 15% 20% 25% 30% 35% 40% Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Numberofcreditnotes Revenue from Brands Revenue from Services •  We get asked for Services (set up and summary social media reports) from our direct brand clients •  Services are very lumpy
  20. 20. HR and Legal: from… You can’t do that Sign up to our standard Ts & Cs
  21. 21. HR and Legal: to… Happy and motivated staff Let’s negotiate the Ts &Cs
  22. 22. Ourstrengths… $ PRICE   ACQUIRE   BILL   COLLECT   NURTURE   ACCOUNT   MEASURE   ITERATE   SCALE  
  23. 23. Somechallengesremain… $ PRICE   ACQUIRE   BILL   COLLECT   NURTURE   ACCOUNT   MEASURE   ITERATE   SCALE  
  24. 24. Reasons why… Acquire:   Complex   product   Bill:   One  offs   Collect:   Enterprise   Customers   Nurture:   Complex   Product   1 2 3 4
  25. 25. What it all means R U N N I N G O P E R A T I O N S I N A S U B S C R I B E D B U S I N E S S •  A subscription company can grow v fast •  Existing customers retained at low(ish) cost •  Allow majority of company focus on product and new sales •  Flexibility, a complex product and larger enterprise clients can make it hard to get all benefits of subscription economy •  For Brandwatch, Operations has been a slow building process
  26. 26. Thankyou
  27. 27. Photo  AGribu,on   Slide  6  Gargoyle  1:  by  Julian  Fong     Slide  7:  (sales  and  product)  by  chuck624   Slide  8:  Rob  Faulkner  with  thoughUul  frieze   Slide  21:  Alexandre  Dulaunoy  with  the  graffiY  gargoyles   Slide  23:  Akbar  Sim  with  RoGweiler   Slide  24:  Jennifer  with  thank  you  gargoyle   Extra  10%  price   Amazing  increase  in  func,onality  +  not  really  loose  on  price   1  day  to  implement  

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