Recently I had the pleasure of talking to Sebastien Mirolo of DjaoDjin. This conversation may be of interest to developers in a consulting or contracting capacity who are looking for greener pastures and a relief from the feast or famine cycle.
Even if your work is steady, but you just can’t help but wonder what’s beyond the horizon, this is an interview for you.
Tell me about your company and product, how did you get started?
“Djao” is a salutation word in Northern Thai that translates to welcome. “Djin” refers to a spirit inhabiting trees, lakes and mountains in Africa. DjaoDjin is the Welcome Spirit.
Our stack is Django and we build the complete product as open source from day one; so DjaoDjin seemed a good name to me. In hindsight, many times people thought we were an Asian company – even bots try to register fake accounts with qq.com e-mail addresses.
When we started working with the biggest energy utilities in the USA such as PG&E, we had to explicitly state on the website we were US-owned and US-based. That’s where the unusual “Built in California” statement on the homepage comes from. Turns out, after talking with my wife (who is from Thailand) and other friends, I misspelled both terms – Djao and Djin. In the end though, we rank really high on Google search. Even with typos, you can find the site very easily.
We started as a development shop, cleaning up payment and accounting systems for SaaS companies. Database transitions from monthly subscriptions plans to yearly subscriptions plans, a chargeback suddenly changing reports of revenue from 3 months ago, a user that is at the same time a subscriber and a provider on a SaaS marketplace, and more bugs you get from growing a SaaS product with a development team that many times has not been there before, we’ve seen it. We’ve fixed it.
There are a few established e-commerce platforms (Shopify, Magento, etc.) but each SaaS company usually re-invent the wheel and feel the pain of it. One of the main reason for that is SaaS is services. A SaaS product is a way for teams to communicate. Value – hence monetization – is in the interactions amongst various people through the product. This seems impossible to rationalize into a framework at first.
At the same time, login, user profiles and billing statements, i.e. the accounts and billing workflows, as well as advanced service access policies (role-based and/or rule-based access control) are expected standard features nowadays. That’s why you see companies like Auth0, Stripe and others providing part of the solution.
Here is a chart of vendor landscape for enterprise-ready SaaS:
Now, if you are starting, with one or two engineers on staff, you don’t want them to spend all their time fixing the user profiles pages, integrating a dozen third party vendors just so customers can buy and access your actual product. This is where DjaoDjin comes in. We started with a simple question from one of our long-time customer, Hasan Mirjan of SphereMail: “How long does it take for me to go from idea to a live SaaS product I can charge for? Can it be done in one day?”
How did you validate your idea for the product?
We went to all the customers we had at the time and told them: “Listen we can’t go on like this. What you are paying us to fix billing and access permissions bugs is money you are not investing in the growth of your business. We will deliver a better solution at a much lower cost.“ That wasn’t a difficult sale.
Beyond that, validation is an interesting concept. We talked to many first-time entrepreneurs and they couldn’t see the value in the product. Second-time entrepreneurs, and developers that had to deal with the billing workflow and constant pricing tweaks of a SaaS, loved the product.
I guess idea validation is as much about finding the right people to talk to as having a good idea in the first place.
Can you talk about how you generated traction for your launch?
We never officially launched. Someone found us and posted DjaoDjin on ProductHunt. That created a 24h spike and a dozen sign ups. Then gone.
What we have done and keep doing is to develop the product as open source. We can see the number of stars on the GitHub projects trending up. We have also written very technical blog posts [example – emphasis mine] (some ranking on the first page on Google results). It took one year and a half before getting an inbound lead from the blog.
In B2B SaaS, especially when you are handling hosting and billing for a customer, it very much comes down to trust. We are still mostly focused on inside sales and acquiring customers through referrals.
What is your business model and how have you grown your revenue?
At first, you could build a SaaS product on DjaoDjin platform for free and when you were starting to collect payment in production, you would start paying the hosting fee. It turned out a few big customers where quite happy to use the authentication and access control policies features but were not using the billing features.
We ended up with a simple, tier-based pricing model where customers pay for hosting based on the number of HTTP requests.
We have a long-term sales cycle but very low churn. Most of the revenue growth at this point still comes from current customers growing their usage.
What specific things did you do well and what were the results?
We built an awesome product. Every time a customer comes to us with a new use case, they are surprised to hear a feature already exist and it only needs to be enabled. We did that one well.
We are so focused on customer support that one of them decided to put the account executive in his will. We did that one well.
On the other hand, our team struggles to maintain a balance between support and sales. We haven’t invested enough into whitepapers, and we haven’t reached out to as many people that could benefit from DjaoDjin’s product as I would like to. We are still looking for some to join us and really own those efforts.
Anything else you’d like to share?
There is a lot of wisdom out there but very little context around where it comes from. It is important to remember context matters more than anything else when it comes to good advice.
Takeaways from Conversation with Sebastien
Having spent time on both sides of the fence – one foot as a consultant with B2B clients and the other in the indie hacker movement, I got to see some behind the scenes processes and thought patterns.
One thing that constantly sticks out is this idea that products have to be sexy and appeal to the masses. We are constantly bombarded by these shiny apps and sexy tools that solve a minor inconvenience for a lot of people, while the unsexy – the boring tools that power the business world and the people in the trenches are mostly ignored.
In Sebastien’s case, he discovered that first time founders may not be the ideal audience for his product because they simply haven’t had to deal with the problems faced by 2nd time founders.
During our conversation, he also shared an anecdote about a friend who found great success in a robotic solution to inspecting sewage pipes. We joked how there is a lot of money in the shit business and how growing up in the Midwest my family would occasionally need to have our septic tank drained from overflow. The point being here, that while there is ridiculous money to be made in mass-consumer or mass-business applications, very little attention is paid to the stuff right under out feet.
Here is my recap of takeaways that I personally found useful and that you may benefit from:
- If you are a consultant or contracting developer who is constantly coding the same thing or some super expensive custom solution for your clients, there might be an opportunity to productize your work and sell it to similar clientele. For clients, it’s a win-win: less money spent on custom solutions, more confidence in ongoing support (hint, hint!).
- In a B2B environment, connections and referrals can play a large part in your company’s growth. Sebastien mentioned that he frequently attends Meetups and various conferences to connect with people. On multiple occasions customers came via a referral from people he met (both customer and non-customer). This is especially true when you are trying to sell to other developers who frequent tech conferences and hang out in the same circles.
- You don’t need a sexy product used by millions of people. There is a ton of money in B2B (people are in the mindset of paying other vendors money to solve their problems) so that’s a great place to start!
- You can start with just a few marketing channels. In Sebastien’s case it was networking and having previous relationships with clients. He also pointed out that they made effort on the content marketing front, but the growth from those seeds took time to kick in. Lesson being: Start your content marketing earlier than you think is needed (if you can devote resources to it).
- Open sourcing is a great way to attract visitors if your project solves a pain point experienced by other developers or people in the capacity of making a decision based on a technology.
- You can go a long way just within your local network and sphere – at least far enough to gain confidence and to start other marketing initiatives.
- When you price based on value provided, the possibility for scaling a single account is theoretically infinite. This is a point that Clay Collins makes often when he talks about cohort analyses and negative churn. This means that every account can in theory expand their usage and continue to grow your revenue without having to put more meat in the grinder. 🥩Growth does not have to rely solely on new customers!
Here are some questions to get you thinking about ideas, products and growth:
- Am I providing a recurring solution to my clients and can I productize it?
- If I am my own audience (eg. developer to developer), what kind of marketing would I respond to?
- Am I making the most of my local network (meetups, conferences, just getting to know people face to face)?
- Is my product priced on value and scale, thus not limited by a price ceiling, or am I using some other metric that quickly reaches a cap?
- Can my existing product benefit from open sourcing it? (an extra marketing channel)
- Am I taking the steps now to lay the foundation for inbound marketing? (e.g. creating technical guides, sharing resources such as books, e-books, whitepapers (B2B), etc…)