- Insight: Try to identify tasks that lead to diminishing returns sooner so that you can pivot.
Saturday, December 23rd, 2023
Susanne Klepsch grew up in a family of entrepreneurs, which contributed to a very entrepreneurial mindset. She even wrote her master’s thesis on an entrepreneurial idea for a real estate platform. Since that thesis, she founded MeetFox, which was later acquired by Brevo. She currently serves as the Vice President of Operations in North America. Check out our case study to see how Susanne started!
400k from Austrian Government programs
600k from investors.
How She Started: What is CoachFox's story and how did that lead to MeetFox?
Susanne Klepsch: I had a friend who was a developer, and he told me about this new technology. He said that you could have video calls in the browser, and it's super easy to build. It may sound commonplace now, but at the time, having video calls was cumbersome. We brainstormed various use cases, including psychotherapy via video, but we were discouraged by the legal landscape. In Austria, teletherapy was actually illegal, but in hindsight, we could have been more adventurous in pushing boundaries.
We then decided to pursue coaching because coaching was not a regulated business. I was focused on growing a coaching database, but I didn’t focus enough on how we would get clients for those coaches. In retrospect, we should have spent more time researching the customer acquisition costs, which would have revealed our less-than-ideal business model sooner.
At the same time, many of our coaches were asking us whether they could use the technology that we built for their existing clients. That's how we then realized it could actually be a SaaS model instead. Consequently, we pivoted from CoachFox to MeetFox and created a calendar solution where you could schedule appointments with your clients on your own website and include video conferencing.
HSS: How did you acquire those first customers for MeetFox?
SK: Acquiring our initial customers was a high-touch process. I personally visited coaches, set up CoachFox on their computers, created their profiles, and took photos. I did a lot of things that weren't scalable, but it was necessary to get them excited and showcase the product. Looking back, it might have been a bit time-consuming, but sometimes you have to do non-scalable things at the beginning to kickstart your venture.
Initially, people were hesitant to sign up because they wanted to know who else was on the platform, and we struggled to answer that question. We tapped into our network to get our first few customers and grew from there.
HSS: How did you retain those customers?
SK: We actively sought feedback and incorporated it into our platform, valuing our customers' input. At times we overemphasized the needs of certain customers because we thought that it was important, but we should have spent more time making our customer base happy instead of placating that one single customer that was screaming the loudest.
In the beginning, we implemented every customization and feature request, which wasn't scalable. While these customizations helped with customer retention, they didn't support growth.
HSS: How did you handle the competition?
SK: We faced competition from larger incumbents, so we focused on a niche strategy. We specialized in specific industries and offered tailored solutions rather than attempting a one-size-fits-all approach.
When the pandemic hit, we experienced a significant increase in sign-ups. However, larger players began offering their solutions for free. We provided COVID incentives to help businesses continue, but competing with well-established companies offering free services was tough.
HSS: Why did you raise money and how were you able to raise that amount?
SK: Regarding fundraising, I was quite inexperienced when I started the business. Looking back, I would have modified my approach. I tried to bootstrap as much as possible. Though it is possible to successfully bootstrap your business, I think we would have benefited from investment to fund marketing initiatives to grow our user base. We were being a bit too cautious when we could have taken some more risk.
I also think that I should have raised bigger rounds right from the beginning, which would have helped grow the business at a faster rate. I would have gone into the investor conversations with more confidence. I was always too honest in the conversations, and I realized only afterwards that people are always overselling in investor calls.
HSS: What were your lessons learned?
SK: A huge lesson I learned was that we spent too much time building a robust product. In hindsight, we could have started with a basic minimum viable product (MVP) to gather insights more quickly and adapt our product to the market. For instance, we developed a scheduling system at a time when Calendly was emerging. Focusing solely on scheduling would have allowed us to refine our marketing message and build the best scheduling solution, rather than diluting our focus with additional features like video calling and payments.
HSS: Do you have any additional advice for female-founded businesses?
SK: I would suggest not being overly cautious. It's important to oversell your business because in the competitive landscape, it can be challenging to stand out against male-run businesses.
HSS: Can you talk me through the acquisition?
SK: We realized we wanted to partner with a larger software company, so we reached out to several companies for potential partnerships. Interestingly, they all responded by expressing interest in acquisition rather than partnership.
We started thinking about it, and at the same time, there were lots of our competitors who also got acquired. There was a lot of consolidation happening. We were quite strategic about it. We created a whole list of potential acquisition patterns, and we decided to reach out to them. We put them into different clusters depending on what kind of acquisition that could be. For example, we had categories like a competitive acquisition, a product acquisition, or an industry verticalization.
We began exploring the idea, especially as we noticed other competitors getting acquired and consolidation happening in the industry. We took a strategic approach, creating a list of potential acquisition partners and reaching out to them through platforms like LinkedIn. Surprisingly, reaching out to CEOs of big companies and proposing a conversation worked quite well.
HSS: Thanks so much for taking the time!
- Try to identify tasks that lead to diminishing returns sooner so that you can pivot.
- A heavy emphasis on customer service can excite your customer base.
- Be strategic in where you invest your time. Don’t prioritize a customer request just because they scream the loudest.
- When talking to investors, it is not a time to be humble. Oversell your business to get the best valuation.
- Don’t feel the need to add in features when customers are not demanding them.
- When talking to potential investors, oversell your business.