Bootstrap First, Raise Money Later: Wrike CEO Andrew Filev (Part 4)

Sramana Mitra: What was the first year that you were actually selling this product? Was it 2007?

Andrew Filev: Yes. If I remember correctly, we launched the product in June 2007. We had a 30-day trial. The first payment came in 30 days later.

Sramana Mitra: At the end of 2007, how many customers did you have? What did you learn about the business model and the pricing model? What was resonating with your customers?

Andrew Filev: I honestly do not remember. We’ve developed 10,000 paying organizations right now and we’re growing exponentially. This last year, we actually did 2.5x. I don’t remember the exact numbers off the hat.

Sramana Mitra: But you learned something about your business model and pricing model. At that point, what was that learning?

Andrew Filev: I learned continuously throughout the years. We did experiment a lot with pricing in the early days. I wouldn’t tell you the exact month and year. There were a couple of times where we completely pivoted the model. For example, when we started, Wrike was very similar to a free agent model. You had your account but then you could be a part of many companies. You can be LinkedIn buddies with anybody in the world. We were working with this open model where you could work on projects with everybody in the world. It was like one big network. I wouldn’t call it a social network. It was very focused on work collaboration, but it was a very open network.

Then we realized that work is being done in teams that are fairly cohesive. We pivoted from the individual and collection of individual model to a team model. That was one big pivot. We originally started selling out products where you could buy three seats. Sometime later, I looked at it and said, “This is fairly complicated.” When the small business buys us, every time they get a new employee, they have to think, “Do I now have to grant this person a license? Maybe I don’t.”

My goal was to help the whole world get their work done. That was when we changed the pricing model dramatically. We gave these people packages and we based it on their comfort level. If a company was ready to pay $15,000 a month, what is the maximum amount of user licenses and features that we were ready to give them? If the company is ready to pay $100 a month, what can we give them? That was a big task. It was successful for us. It was successful from a psychological perspective.

As for me, I wanted to make sure that we give customers an opportunity to easily add their partners and new employees. That was a big change. Eventually, we added more in that model where we added free collaborator accounts where they can bring anybody into the project as collaborators for free. You have a core team that works on this project but maybe you want to share it with your customer, and you’re not necessarily ready to pay. It’s a big value to you if they join your account. Pricing is obviously a complicated matter. When it comes to simpler things like landing pages, we did thousands of that. Since my background is in engineering, I’m a big fan of the scientific method.

This segment is part 4 in the series : Bootstrap First, Raise Money Later: Wrike CEO Andrew Filev
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