Bootstrapping Using Services from London: Conversocial CEO Joshua March (Part 6)

Sramana Mitra: At that time when you were going through this thought evolution, I imagine you must have done some competitive analysis. All these companies like RightNow and people who came at it from the customer service side were also discovering that they needed to do this. They need to support customer service from the coming out of the social media channels. They were putting in gear solutions for that. How does that impact your thought process?

Joshua March: The prediction that I made using the framework of Innovator’s Dilemma was that all these companies will probably talk about social, but none of them would really invest in it in the way that was needed to create the product. Traditional customer service like email, phone, and live chat all have essentially the same framework and the same work flow process. They’re one-on-one private interactions between an agent and a customer where every single interaction that comes in is a service request. It’s all in platforms that are controlled by the company. Social media comes along and it’s completely different. First off, and most importantly, it’s no longer a private channel. A lot of it is public. It’s on a third-party platform, so it’s not controlled by the company.

All of these things mean two very important things. First on the technological, it means that the work flow for traditional customer service doesn’t work for social media. You can’t just raise a ticket for every comment that you get. You need to be able to differentiate between service and non-service intelligently. You need to recognize the difference between public and a conversation where multiple people are involved. You can’t just add social into your traditional customer service work flow. You can try but it’s going to be broken. It won’t work. Add on to this that the third-party platforms with third-party APIs can be unreliable at times and can change frequently. That means that unless you have a team fully committed to it who are experts at social API and unless you have a complete SaaS solution, you’re going to really struggle.

Most of the traditional customer service vendors are still either fully on-premise or partly on-premise. They’re not pure SaaS. So there are a lot of technical constraints and issues. The bigger issue is all about the market dynamics. Because of the public nature of social media, no large company was and is willing to just add social media as a channel for any of their agents. They’re running a live chat. They’re responding to an email and then all of a sudden, you’re responding to a public tweet that could be seen by millions of people. It’s far too risky. Every company had to set up a unique team of customer service agents trained in social media and how to deal with customers publicly. Those teams would be dedicated to social media. If you look at all our customers today, that’s the case. There are new teams being created even for large companies, that start with 5 to 10 agents. Those agents would just handle social media and needed a tool that was unique to their needs.

Sramana Mitra: Your positioning was not to bolt onto the existing customer support organizations. Your thesis was that you needed a different team trained in different skills and equipped with different tools and technologies to be able to do customer support on social media. That really was your core positioning.

Joshua March: Exactly. Conversocial was the tool to power that team.

Sramana Mitra: How long did it take you to come up with this positioning? Where in the time horizon did this crystallize for you?

Joshua March: Towards the end of 2011 and beginning of 2012. We re-launched with new messaging and re-launched part of the product with new functionality geared towards that.

Sramana Mitra: The process of getting up to that crystallization was happening on your own dime or was there financing involved at this point?

Joshua March: Until mid-2011, it was all our own dime. I think we invested $400,000 personally up to that point, which is quite a lot for us.

Sramana Mitra: I assume you made some money from the previous services business right?

Joshua March: Yes, that was primarily driven from the services business. By mid-2011, we had live products and already had customers. Because of that, we were able to raise a seed round from VCs. It was $2.4 million in late 2011, which enabled us to start hiring properly and start developing products.

This segment is part 6 in the series : Bootstrapping Using Services from London: Conversocial CEO Joshua March
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