When creating a new product, one of the main points to think about is how it is going to create revenue for your company. And sometimes the question can be kind of confusing and even scary.
At Saastr 2019, one of the topics of discussion was precisely how to scale revenue but through indirect channels and the importance of taking them into consideration when getting started with building a platform, a conversation between Vicki Lin, Head of Ecosystem at Stripe, Niall Wall, SVP of BD, Channels + Emerging Businesses at Box and Ceci Stallsmith, Director of Platform Marketing at Slack.
During the conference, one of the main points the speakers talked about was the importance of focusing on developers and APIs because they’re a core part of the DNA of any platform or ecosystem.
Throughout the talk, the speakers all agreed on one thing: you need to have flexibility in order to last. Niall Wall shared how Box started as a consumer file sharing company and how later on it pivoted to focus on enterprise and how this started as a freemium service. Meanwhile, Cece Stallsmith talked about the importance of having a market fit for your product. Having that market fit in the beginning, allows for customers to start trying it out thus increasing the chances of developers and partners to see you and think they will be able to leverage that effectively for their products, generating demand that kicks up the useful integrations on your product that make it more useful.
“Slack built its first 80 integrations in-house. That created a lot of demand but opening the APIs to the public and creating a directory of apps has brought a lot of growth and success to the platform (...) convincing the engineering team to invest in creating 80 apps was easy and our 2013-2014 growth was due in part to integrations and it was obvious that we needed people to be able to build more integrations on us” - Cece Stallsmith
As of 2019, Slack’s directory carries over 1000+ integrations. Like Ceci has mentioned, opening their API has brought great success to their business and has allowed for integrations that go far and beyond their initial 80 integrations, like our Stand-bot app (a Slack and Jira integration) that enables remote and distributed teams to run stand-ups in Slack and allows them to integrate with Jira (in cloud and server) and report on their issues.
But how do you know how to scale a business?
It’s indispensable to learn how to measure the value of your platform or ecosystem. For Slack, the 80 integrations help the team knew that it was making the product “stickier” because users were using those integrations every day.
Scaling a business starts from being able to measure the value it provides after identifying what are the challenges that it is tackling.
“You don’t build an ecosystem just to build it but to be solving a business or a compelling business problem (...) for us it was “here’s a real problem that our users are facing, they want to onboard their customers and make it easy for them to accept and manage payments. So that makes it easy to measure value” - Vicky Lin
What are the trapdoors to avoid when building a platform?
It is crucial to understand the way you want your business to operate. You shouldn’t assume that your idea is going to be successful from the get-go but the contrary, as it will allow your team to create your tooling around that. You don’t want to be giving away free versions to everyone because that would mean a lot of people would use the product but it won’t allow it to scale.
Before deciding if your product will have trials or tiers, you need to make sure you identify a “why” before building it and that APIs are world class as the rest of your product.
“The more value you provide to developers, the more likely they’re gonna give you their attention” - Vicky Lin