Wow, it’s been 3 years since Chargify got started.
It was early 2009. The folks at Grasshopper (below) recognized recurring billing as something more businesses wanted to do, but actually doing it is more complex than most people think. They launched Chargify within Grasshopper.
I was one of those people finding out the hard way.
At the same time Chargify was starting out, I was wrapping up my role as co-founder/CEO of Engine Yard after growing it to 80 people. Engine Yard experienced the pain that Grasshopper was aiming to solve. We solved it with labor and custom software, which was error-prone & expensive.
Long story short: we found each other and I joined Chargify later in 2009, around the time the first merchants started running on Chargify.
SO MUCH IN A FEW YEARS
We’ve grown our customer base, added software developers and support crew, added features, worked with partners, and generally done all the stuff a business does as it grows from idea into a real business.
When I think back to 2010, it’s amazing that we didn’t support coupons, taxes, or statements – all of which are big things to many merchants. And until early 2011, we didn’t have any Level 2 tech support separate from our software dev team.
Many areas have filled in, and yet we have at least another year of similar developments.
Fun Story: How Mark Cuban got involved: We wanted to jump ahead of revenue a bit, so we could develop features faster, and we wanted a smart outsider who could bring cash and wisdom. One of my Twitter followers (@MarshallHaas, a fellow motorcycle rider) rode his motorcycle from Dallas to Sacramento, and I showed him around town on our bikes. While out on the road, he suggested I email Mark Cuban re Chargify. I did, and a deal was done that night. I’ve done venture capital deals before, and this was very different! It was fast, as in a few emails and done! (Btw, other than Mark’s investment in 2011, Chargify is funded by founders & revenue.)
WE’VE MADE A FEW BAD CALLS
We changed our pricing in 2010 and didn’t carry it out as smoothly as possible. It was absolutely the right thing to do to get revenue in line with costs, but our execution left a bad taste.
And some technology choices that were right in early 2010 started being wrong in late 2011, as the number of merchants running on Chargify passed 700. We started running into capacity problems here and there. We spent December solving about half of the issues and the rest will be finished in January. (Read our system architect’s blog post from December.)
Details: Our data center provides a managed database as part of their PCI environment. It was great for a couple of years, until we noticed performance problems once in a while. At the time, we were focused on new features and integrations that merchants really want, so we only shifted part of our time to it. Other components needed to be changed, too, like replacing delayed_job with Resque (many of you won’t know what those are, and I only barely know).
A handful of systems have been upgraded with no downtime, but one change did result in some logging and webhooks not being processed for a few days, and that led to the need to create a new interface for merchants to replay missing webhooks. This may indeed be something useful in the bigger picture, but we didn’t intend to work on it right now.
So, the point is, December and January got swallowed up with improvements that are tremendously valuable, but at the cost of pushing off a few really useful new features that some merchants really wanted by now.
LOOKING AT THE NEW YEAR
We’ll wrap up January with the capacity improvements mentioned above, and then we have a backlog of fantastic features and integrations that we’ll get back to.
Can. Not. Wait.
Most of the team is meeting in Raleigh, NC, later this month. Several of our software developers live there, and they’ll be moving into our new Raleigh satellite office (see pics above & below… we just got the space, so it’s empty here, but that Starbucks right outside will help ensure productivity!).
We’ll be reviewing input from many sources as we decide priorities. There are hosted page improvements, MailChimp integration, and dozens of other things – some very small, others very large.
Priority will go to things that help the greatest number of merchants, as well as things that help partners and affiliates who support merchants.
Sometime in 2012, we’ll shift our focus from new features and new market segments to what I call “cruising altitude,” which is the point when we satisfy the needs of most of our core SMB customers, and then we just polish the product over and over. That’s how something gets really refined. It takes time.
It’s interesting how the process just works itself out. We attracted a certain segment of the market, and a feedback loop developed. We’re already at a point where some merchants are perfectly happy, but others still need things we don’t support. At some point, a large majority will be happy, and most new feature requests will be for niche things.
Of course, there’s a danger of getting stuck in a bad segment of any market, but it feels good where we are now… small & medium businesses run by genuinely nice people who are happy to pay a reasonable amount for us to manage a chunk of their business. That chunk is important and hard to do, but it’s not their core business.
AN ENJOYABLE STAGE
I really like this stage of a company: 10 people supporting other small and medium businesses. We’re small enough to be very friendly & self-managed, but we’re big enough that our future is far more predictable than it was 1 or 2 years ago. And every member of the team cares about our service and our merchants.
RADIO SHACK & THE LONG TERM
Over the holidays, I walked into a Radio Shack to get some audio stuff, and there on the counter were a half-dozen Basic Stamp computers. Parallax makes them, and the last thing I did as co-founder/CEO in 1996 was to finalize the contract with Radio Shack. I’m always happily surprised when I bump into them somewhere. It’s been almost 20 years since we started manufacturing Basic Stamps, and they’re still selling! Isn’t that amazing in any tech market?
The Radio Shack experience reminded me that Chargify is a long-term thing. The company may outgrow me in a few years, and then someday later, I’ll talk to someone in an elevator and they’ll mention that their business runs on Chargify!
THANKS, AND ONWARD!
Thanks to everyone who’s helped us grow this far! Let us know if you need anything, and let us know your priorities as we map out 2012.
Oh, and here’s a new screen cast that I made on January 1st. I’d love to hear your feedback. Some have said it helps them understand Chargify in a nutshell.