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Welcome to the fifth episode of Founder's session, where I have a chat with the founders of SaaS companies on their journey building the company.
This session's guest is someone whose company is enjoying an awesome time recently. April-2020 has been a huge month in their journey as they have been just backed and raised seed round investment from the likes of Google and Slack.
That's some milestone and encouragement for a SaaS company and a huge stamp of approval that the product is fantastic.
The story got published in Techcrunch.
Without further due, let's meet Darren Chait, Co-Founder of Hugo, a productivity and collaboration SaaS tool focused on meeting and note-taking for meetings.
Hi Darren, Welcome to Founders' session. Thanks so much for joining me for a chat. Much appreciated.
First up, congratulations on raising a very impressive seed round. More than the money, getting the backing of companies like Google and Slack must be so fulfilling and encouraging for the whole team.
Can you tell us briefly on the whole process of this raise and your takeaways as a co-founder from it?
Thanks, Yusuff. It definitely feels great to have the backing of great investors that will enable us to grow and execute on our mission, but also to partner with investors and organizations that have defined many of the ways we work and created the path before us.
The process was interesting. We were lucky in that we rekindled a conversation with an investor we had known for a while who ended up being a lead investor, after getting some increased exposure through ProductHunt and some other channels in late 2019.
From there it was a matter of developing relationships with investors who shared our vision and quickly understood what we were hoping to do over the coming years.
And, then the first investors introduce you to people they think would be a good fit and so on.
For some of the readers who might not know, can you explain briefly what Hugo is and what is the problem it solves as a SaaS product for a business?
Hugo is Connected Meeting Notes software. It’s one place for fast-moving teams to set shared meeting agendas, share collaborative meeting notes, and index and organize everything about your meeting based on who attended.
Instead of meeting knowledge being scattered between people, tools, and their own solutions, Hugo is the central place for this critical information – connected to your calendar and 20+ chat, CRM, video conferencing project management tools.
Today, Hugo powers thousands of companies including Atlassian, Slack, and Spotify, many of which were already distributed or remote-native companies.
Tell us a bit about yourself and your background when it comes to tech and SaaS?
I come from a corporate law background, having practiced in Australia before moving to San Francisco to co-found Hugo.
My co-founder and I started Hugo to solve a pain for ourselves, based on the frustrations we had in prior roles with unproductive meetings and the detrimental impact they can have on teams.
We both come from strictly non-technical backgrounds (i.e. we couldn’t code), but today I own the growth function of the business (which is self-serve and therefore relatively automated and technical), and Josh owns the product and design functions.
What was the key motivation behind building Hugo? When was the first line of code written and who were the co-founders when you started?
To elaborate on our founding story, Josh and I started Hugo trying to solve a problem with meetings in a very different way with a mobile app that helped with getting prepared for meetings. It was for the individual with no team functionality or benefits.
While we were building and growing our user base for Hugo 1.0, we were struggling to stay aligned as a team with a few of us spending days full of meetings and others working on the design and development of the app.
To help our team, we built a hack in our app which allowed us to take notes for each meeting, connected to the meeting using calendar data, which would automatically post to Slack – so everyone could be in the room.
Then, we added the ability to create Trello cards, so actions actually got actioned right from the meeting instead of slipping between the cracks.
Overnight our team transformed. Meetings became our secret sauce to stay in sync and for everyone to better understand our customers, and the rest was history.
Hugo became Hugo as it is today. In 2018 we released Hugo 2.0 to the market.
What are the primary channels you have promoted & marketed Hugo until now? Are there any plans to expand to new growth channels?
Almost all of our customer acquisition has been organic or referral based. We rely heavily on content and partner marketing, based on our integration relationships with other great SaaS companies.
Once we acquire one user at a company, we typically grow horizontally across the company until a good proportion of the organization is using Hugo, so we have that growth dynamic that helps too!
We’re always experimenting, but at this stage, it makes sense to double down on what’s working.
Absolutely agree with you on doubling down on what's working.
What is your and your team’s vision for Hugo?
Our mission is to Connect the way you meet, to the way you work. We see meetings as an integral part of how teams work together that hasn’t changed in generations.
Layering on remote work and the explosion of tools means that rapid change is required with meeting workflow, and we obviously want to be a key player in powering that trend.
I believe the idea initially started out as an effective way to share meeting notes in Slack and expanded from there to other apps. Is Slack still the most widely used integration by Hugo users or the usage is more widespread?
That’s right. Yes, Slack is still the most commonly used (other than Google Suite / Office 365), and the reason is simply that Slack is a product used by the whole organization.
Almost all of our other integrations are department-specific (Salesforce for sales, Jira for engineering, etc.)
The product can be used by industries and teams across all levels, from SMB’s to mid-market firms to enterprises. Everyone does meetings and there surely is a need for an effective tool for meetings to be more productive.
However, who would you define as an ideal target customer for Hugo at this stage towards whom your marketing efforts would be channeled?
That’s a great question and something we learned as an essential part of go-to-market, early on. Today we’re focused predominantly on SMBs and some mid-market organizations.
While the pain we’re solving for is universal, the ease of adoption and their use of complementary SaaS tools without complicated sales processes make that segment an attractive starting point.
There are no short of options when it comes to note-taking. Some massive players in the space like Evernote, Onenote, Google Keep to new & upcoming options like Notion, Coda, etc.
Some even being free, how would you define the need for a prospect to choose Hugo over all the other options, and what makes Hugo unique?
Every organization needs a place to store documents and company knowledge, and some of the solutions you mentioned are fantastic products for teams to store this sort of content – the wiki.
However, based on the hundreds of meetings we’re all attending each month, using a folder-based wiki or document solution for your team’s meeting notes (and agendas) breaks down very quickly.
It’s difficult to quickly find notes from a previous meeting, especially if you weren’t in the meeting. It’s hard to understand where a relationship or project is at with respect to meetings and we all know folders and folders full of documents rarely get looked at again.
Finally, turning meetings into action, and then closing the loop from action back to the next meeting is near impossible. This all gets worse with each person you add to the team.
Hugo is specifically designed for meetings, with your calendar at its core. You set agendas and take meeting notes based on your calendar, so every meeting insight collected is linked to the contacts, companies, and meetings you attended.
Every team, therefore, needs a solution for meetings, in addition to a wiki-like place for product specs, policies, and draft blog posts.
Yeah, I can definitely see the uniqueness of the product and what it offers.
The current customer's list of Hugo looks so impressive with the likes of Atlassian, Dropbox, Shopify, etc. How did you acquire the first 5 to 10 users? How difficult was it?
It was difficult, particularly before we could articulate what Hugo did, and why you needed it. Our first few users came from our network, but not necessarily by asking friends and family to try the product, but rather asking friends and family to introduce us to people who specifically met the criteria we were targeting.
We tried lots of things, but until you have the positioning down, it’s hard to use any regular acquisition channels well. You need to face time and a willingness for them to listen, so relationships help.
Any plans in the pipeline to raise more funds? How do you see the seed round channelizing growth? Will it be on more hiring?
Not at this stage, but perhaps down the track. We plan on a much shorter-term basis than our runway currently permits, so we’re definitely open to raising more money when we get closer to needing it and have a better sense of how we’d use more capital!
This seed round is focused on unlocking the next phase of growth. As a self-serve company that mainly means product and growth talent, with some money for other acquisition experimentation too!
Almost every SaaS company has taken a beating amid the current crisis except for the ones dealing with remote work and collaboration. How has the situation been with Hugo and if there was a huge spike in usage, how were you able to handle it?
We are fortunate to have seen very strong growth in these difficult times. Hugo powers many remote teams and we’ve seen lots of other teams looking for new ways to support their team working from home.
The challenge hasn’t been so much on the infrastructure front, as our product is architected in a relatively scalable way, but perhaps more on the support and customer success side. Like everything in an early-stage company, it’s been a case of everyone putting a hand in as required.
What is the major shift in the SaaS industry in your perspective in the past 5 years and how you see it evolve over the next decade?
We have all experienced the explosion of SaaS over the past 5 years. There are all sorts of statistics out there, with something like 130 different SaaS tools used in the average enterprise, which is crazy.
The ease of adoption with so many self-serve products and deferred monetization strategies has been it’s never been easier for organizations to adopt more and more tools.
One of the key costs, however, has been data fragmentation as key organization knowledge gets sprinkled between so many different systems of records.
I think we’re already seeing this being responded to with products that focus on integrations and interconnectivity (Hugo included). We, as a company, select SaaS products based on how it integrates with our existing stack, and this is becoming a common trend to offset this challenge.
Your favorite SaaS tool apart from yours and why?
Shying away from the obvious players like Slack, I’d have to say Loom. We are big believes in the value of asynchronous collaboration – particularly while remote.
Loom allows us to communicate with a similar level of bandwidth or fidelity as we do in person, but on our schedule as the idea hits, or you have time to share the feedback, etc. It’s had a very meaningful impact on the way we work.
Loom is awesome for sure.
Your favorite SaaS company whose marketing strategies you would be happy to implement at Hugo for growth?
I think Drift has done a great job here. Conversational marketing is now a household term, and their playbook has defined much of the strong consumer-style marketing that is now common in B2B Saas.
What is the team size currently both on-site and remote, and are there any plans to expand the team in the near future?
There are 10 of us at the moment, half on-site and half remote. We expect to grow the team a little over the coming months.
Some words of advice for any aspiring entrepreneurs especially in the SaaS? In your experience, what are a few things to do and a few mistakes to avoid at all costs?
I feel like a bit of an imposter giving advice, as we’re still an early-stage company with lots to figure out. However, I can share plenty of mistakes.
We, and I think many first-time B2B SaaS founders don’t appreciate the importance of distribution and go-to-market at the early stages alongside the product.
There’s some outdated blueprint that says product first then marketing, but I believe they are as challenging and require the same level of strategy, investment, and differentiation.
Don’t leave it until later – if anything market now and build later once you have a line of customers out the door waiting for your product.
That's some brilliant advice, Darren. It was a really informative chat on so many aspects of building a successful SaaS startup. Thanks again for joining me and I hope to meet you back soon.
Thanks a lot for having me on for a chat, Yusuff.