What It Takes to Forge Your Own Category with Braze's Co-Founder and CEO
Bill Magnuson, Co-Founder and CEO @ Braze “Find a need and fill it” is a well-known maxim. After identifying the white space, though, understanding how to navigate category creation is key in order to grow and scale a company for the long term. For many SaaS businesses, the first category others consign you to may not match your ambitions as a founder. Entrenched forces have a vested interest in maintaining the status quo, and it takes courage to stick to your convictions about the future. As industries expand and mature, new strategies are needed to further deepen the competitive moat to secure and retain category leadership. Product is just the beginning: Ongoing success hinges on the growth and cultivation of the team, the company culture, and the larger stakeholder community—the work is never done. When Braze was founded in 2011 with Bill Magnuson as CTO, smartphones were just becoming mainstream and mobile marketing was in its infancy. At that time, the category term ‘customer engagement platform’ did not exist yet, but the cofounders believed that technology which enabled brands to better understand and serve customers across mobile and beyond was the future for Braze. Fast forward 10+ years, and the founding team’s conviction has enabled Braze to become a leader in the nascent customer engagement category, reaching $100M in ARR in eight years, then doubling that to $200M less than 18 months later, to then making its public company debut at the end of 2021. In this session, Braze Cofounder and CEO Bill Magnuson will share best practices and lessons learned from his experience scaling Braze and establishing the company as a leader in the recently formed customer engagement category, including: Having conviction for your vision will help you navigate the changing SaaS landscape as you grow your business. Staying true to your initial vision is critical to category creation and for long-term company success. Determine when and whether to pivot, or to adapt to shifting circumstances. Founders must be adept at identifying and articulating the unique value the business delivers, refining the message over time without deviating from foundational beliefs. Category leadership results from a community effort: customers, end users, partners, investors, analysts, and team members collaborate to build on the founders’ vision. How and why a CTO founder might transition to CEO: Technical founders deeply understand product value and can take on the wider leadership role as they navigate the nuance of category creation.
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What It Takes to Forge Your Own Category with Braze's Co-Founder and CEO
Editor's Notes
- Creating a category [29:30]
- origin story [29:00]
- Braze today: IPO. New Q2 numbers: employees, customers, MAU, messages. Today, I will share some of the lessons I’ve learned while we were instrumental in creating the Customer Engagement Platform category. [28:30]
- Google/Android - front-row seat. Rapid consumer behavior change. [27:30]
- Dual conviction in rapidly changing landscape Goal: create business value [26:30]
- Didn’t know much about marketing; grew to respect expertise Technical founders’ tendency to lack respect for marketing The product will not sell itself [25:30]
- Our customers’ success proved our hypothesis: good customer engagement drives bottom-line results. [25:00]
- Look to macro-indicators to affirm convictions and guide actions …and don’t get distracted [24:30]
- 2 to 20M ARR is key growth period At Braze, it happened across two years. “That was fast!” – but we hit this scale years after founding. [23:30]
- When we launched, smartphone market was nascent. Major revenue growth came when market matured. [22:30]
- Similar growth curve with the app market. It can be seen as a TAM indicator. [22:00]
- Economist article from 2014 celebrating 25th anniversary of www. Time to 25% adoption in US – we added iPhone, further proving trend. Business must keep up with consumer behavior changes. SaaS must help lead business transformation. [20:00]
- Faster growth is not necessarily better. [19:00]
- What is the best way to grow? Risks of C and B. Benefits of A. Perspective of market; perspective of entrepreneur. [16:00]
- Rapid growth has costs. What and how to control for sustainable growth. [12:30]
- Prioritize and focus on differentiation. Preserve scarce resources in early days. Strategic partnerships can fill the gaps. Avoid burning resources on commodities others do better. [11:00]
- Think about value chain as you build product. How can you future-proof? Let’s look at Braze as an example… [10:00]
- Streaming data. Vertical integration at center of the stack. Modularity at top and bottom. MAU value capture linked to single view of customer. Alternatives included data flow, push quantity, bandwidth/storage. [07:30]
- Early customers are valuable, but not with you forever. They tolerate risk but don’t want to pay. Think ahead about future customer needs. [06:00]
- Tomorrow’s customers will have different requirements and desires. [05:30]
- If you build only for Early Adopters, Pragmatists and Conservatives will buy from others. Here’s an example from Braze… (SEGUE to drag ‘n’ drop email video) [05:00]
- Early teams had engineers. Later customers needed easy-to-use tools. Privileging early adopters = missed market share. [04:30]
- Be foresighted about the concerns of those under the curve. Almost 70% of your customers. Enterprise expectations are different. [03:30]
- Here is a recap. If you only take away three of these, make it: >strategic modularity >grow at the right speed >and build for tomorrow’s customers. [03:00]
- Thank you, and I think we have time for questions.