SaaS Interviews with CEOs, Startups, Founders
EP 581: DocSend $11M Raised, 2800+ Company Customers, 10,000+ Seats Because Links > Attachments For Docs with CEO Russ Heddleston
25 Feb 2017
Chapter 1: What background does Russ Heddleston bring to DocSend?
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Chapter 2: How did Pursuit.com lead to the creation of DocSend?
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Chapter 3: What challenges did DocSend face in its early years?
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good morning guys and nathan latke here our guest today is russ heddleston he's the ceo and co-founder of doc send previously he was a product manager at facebook where he arrived via the acquisition of his startup pursuit.com russ has also held roles at dropbox gray stripe and trulia he received a bs in computer engineering and an ms in computer science from stanford along with an mba from harvard russell are you ready to take us to the top
Absolutely. Very good. Well, thanks for joining. Tell us first real quick. So you arrived at Facebook via Pursuit. What did Pursuit do?
Pursuit was a system for human resources to manage their referral programs for employees.
Chapter 4: How has DocSend's pricing model evolved since its launch?
And so it was a very smart way of tracking and understanding who's making referrals, where those people coming from and helping companies just manage that whole process more effectively. And after running that for a little over a year, we shopped it to LinkedIn and Facebook and decided to go with Facebook.
I appreciate you being transparent there and saying kind of you shopped it. A lot of people say you never want to sell your company. What kind of made you guys decide to go through that if that was truly an intentional process?
It was. We looked at our own numbers and the theory that we had, we had a hypothesis we wanted to test it. We got 40 companies signed up for the service, a few thousand users, and then the numbers just weren't looking like we wanted them to. Can you give an example for us? Absolutely.
Chapter 5: What customer segments does DocSend target today?
So we would look at how many people were being referred and we figured out that they were going out of band. Like those hires were happening and then we were like, why?
And then we kind of dug into psychology of what we're doing and without it being a separate podcast, basically decided that some of our assumptions were incorrect in our product and that to change those assumptions would be a huge process. And we were just kind of out at that point. We'd been doing it a little over a year, raised about 500K. And Facebook's one of our first customers.
So we went and talked to them. We talked to LinkedIn about, you know, just like joining them. Yeah. And you're right.
Chapter 6: How does DocSend ensure customer retention and reduce churn?
We totally decided to sell the company and to shop it around. So that just made the most sense for us.
Would you say kind of soft landing talent acquisition more or less?
Oh, yeah, for sure. The assets of the company weren't acquired, but we were all incredibly happy with the outcome.
So you're a product manager at Facebook. What product were you on?
I was the product manager for the Pages team. So anything with a like button on it, that's not a human being, like a profile. So that's a pretty big swath of what Facebook does is included under Pages.
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Chapter 7: What role does venture capital play in DocSend's growth strategy?
And you, sorry, you said you're working with the personalities versus the brands or the brands?
Brands and personalities both have Facebook pages. So both of them have likes. You can't add them as a friend. And at the time, it was a very small team at Facebook. And I got to have a great experience being there and growing that team out significantly over a couple of year periods.
So let's jump into DocSend now. So what year did you make the decision to leave Facebook and start DocSend?
We started DocSend in 2013. So it's over three and a half years ago now that we started the company.
Chapter 8: What advice does Russ have for aspiring entrepreneurs?
And the very first version of it was something that came from an insight I had while I interned at Dropbox while I was in business school in 2010. And that is that sending attachments is just really not a great way to go. It just brings up a lot of problems. So we wanted to come up with a system that works well for businesses to send documents as links and not attachments.
And there are a few properties that we really wanted that were just missing from all the other systems out there. around security and tracking and being able to update things and just insight in what is happening when I send content or documents out to people. And so the first version of DocSend was just that. That's just what we wanted.
Very simple, easy to use system, sign up, get going, just hit the ground running. And we launched that at TechCrunch Disrupt in 2014.
And what was, because usually this is an embarrassingly low number, which is obviously fine, but do you remember what your first year revenue was? If it was above zero?
No, we didn't charge any money for the first year. So it was for sure zero. Got it. And we were just focused on growth. You couldn't pay us money if you wanted to. We launched the product and we just wanted to see what happens. Where does it go? Who looks at it? Who's using it? And so we launched it. We saw a good spike. We saw a nice growth after that.
And we were really digging into the numbers around who is using it. And it wasn't Facebook-like growth numbers. If you look at a consumer company versus a B2B company, it was clear that what DocSend was doing was a very high value. But it wasn't going to be a Facebook size in terms of user count. We just aren't consumer. Everyone is using DocSend for a business application.
But what happened in that year is that we took a hard look at everyone using DocSend. For instance, people use it in fundraising all the time. If you ask any venture capitalists about DocSend, they'll be like, yes, I get all DocSend links now. And that was really nice for us. Unfortunately, that's not a great business to be in. So we looked at some of the other cohorts of users that we had.
That use case is not a good use case for you. That's right. You can't build a big business around that.
It's like one time, right? Yeah, exactly. After a few months, they successfully raise and they're gone or it didn't work, which is unfortunately a transaction fee on that. Right. Right. Yeah. This would be great. We actually did get approached by a hedge fund about, about buying the company and that would have been awful for everyone, but I thought that
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