📈 Growth Hacker Automating Accounting for eCommerce Stores 🏬 | Tejasawi Raghurama - a podcast by Heather Smith|CAANZ | ACCA |Xero | QBO

Highlights of my conversation with Tejasawi Raghurama

• Growth Save 300 administrative hours per month
• Automates accounting for ecommerce stores
• Bangalore, the Silicon Valley of India
• Increasing monthly recurring revenue and reducing churn

Transcript

Heather:    Hello. It’s Heather Smith here. Thank you for joining me today. I hope you are doing well. Today I speak with Tejasawi Raghurama which I’ve probably pronounce incorrectly but I refer to him as Tej.

Tej is a growth hacker at ZapStitch. ZapStitch is a data integration platform for small business to automate data flow across cloud business solutions. They are automating accounting for a thousand plus e-commerce business from North America, Australasia, Europe by integrating Shopify, Bigcommerce with Xero. ZapStitch automatically imports sales orders into your accounting application’s invoices. Discounts, taxes and shipping rates are sync’d seamlessly which is something he emphasises in the show.

An average business using ZapStitch saves 300 plus hours every month spent in manual accounting, freeing up their time so they can spend it with the customer and family. ZapStitch is the number one ranked and rated accounting add-on in the Shopify app store. Tej believes no human should do a machine’s job and small businesses can grow huge with automation. He places part by educating and working with customers.

When not learning from business, you’ll find him watching South Park. He joined ZapStitch in February 2014 as one of the first employees there. He was inspired by the vision of the founders, the fundamental impact the way businesses manage tedious processes. I started by asking Tej who was his favourite South Park character and why.

Tejasawi:       Awesome. That’s a great question to start with. I think Cartman because I’m fascinated by climatic and realistic people. I always look at the world around me, “That is good.” “That is bad.” But there are people who actually recognise it and live through it. I would see Cartman in South Park as being the most pragmatic and he is who he is. He doesn’t mould himself according to the people around him and he has his originality intact. Yes, he is cruel, I don’t recognise that spirit but I think he’s on his own.

Heather:        Sensational. I don’t watch South Park so I don’t know the character but I thought that our listeners might find that interesting. I know that my son watches South Park but I don’t.

Tejasawi:       Okay.

So Tej, can you tell me a little about ZapStitch.

Tejasawi:       Sure. ZapStitch automates accounting in commerce stores. In simple English, what we do is we create platforms like Shopify and Bigcommerce with accounting apps like Xero, right?

Heather:        Yes.

Tejasawi:       ZapStitch enables seamless data syncing between those apps. We sync data for all the customers and anything related to the invoice and sales tax automation. What we enable at the end of the day is exponentially faster reporting in accounting and accurate data and peace of mind. I mean the most common feedback we get from our accountants and from business owners who use ZapStitch is peace of mind. At the end of the day, accounting shouldn’t be an intimidating step in the process, right?

Heather:        Yes.

Tejasawi:       That is one feedback we often get. At the company level, our vision is to automate business apps across verticals. When we were founded … we are a cloud integration platform, so our long term two year or three year future is to integrate at least 300-500 business apps on the cloud.

Heather:        Oh okay.

Tejasawi:       We are starting with e-commerce and accounting because we believe there are immediate gaps in between them, and we want to solve as many problems in accounting as possible, and go in depth in accounting automation.

Who are your typical customers?

Tejasawi:       Typical customers are twofold. One is an e-commerce business owner or the business team of a 10-man or 15-man e-commerce team. The second end user is the accountant who has multiple e-commerce tools as clients or is working part time as the bookkeeper. Those are two end users but our business is somebody that’s doing let’s say a $2 million dollar revenue per year and who actually feels the pain of data entry, right? A typical business of where we work with spends at least 500 hours in accounting per month. If we can solve that pain point, I think that’s where our end customer is.

Heather:        That certainly makes … if you can resolve 500 hours at your price point, then that certainly is of benefit to the client.

Tejasawi:       Exactly.

Where about are you actually based?

Tejasawi:       We are based out of Bangalore in India. It’s called the Silicon Valley of India, so it’s the Bangalore start-up hub in India, yes.

Where about are your servers based? Where are the data for your company based … for the client data based?

Tejasawi:       We are based … we built it on EWS, the server side across EWS in Singapore if I’m not wrong but I need to get some technical knowledge there. The servers are on EWS and we don’t locally store data.

Heather:        Okay, so it’s not locally stored. It’s always a question that people ask us.

Tejasawi:       Yes indeed.

Heather:        It’s an unpleasant question I guess but the customer is always going, “Well, where is my data?” “Is it in the clouds?” “Where is it?” So it’s important to know.

Tejasawi:       Yes, just to add to that point, ZapStitch believes in transparency, so we don’t store any local data on any server for that matter. We only move data from A to B. there will be apps and I’m sure you’ve interviewed and talked to some where they’re stored locally and in the app they show the data, right? We enable seamless syncing of data and not storing of data. Yes, that’s a belief we are in right now. Maybe going forward when we add features like reporting inside the app we will look at storing data but right now we are only moving data and storing metadata like number of orders …

Heather:        I thought it might be like that.

What’s your internet connection like in Bangalore, the Silicon Valley of India?

Tejasawi:       Internet connection is a problem maybe sporadically but we have good broadband speeds in Bangalore. We have a speed of let’s say 22/30mps. That serves our purpose and we haven’t felt the pain of internet speed at all. But sometimes the sporadic connection is due to the team load rather than the internet speed. When we grew as a start-up, there were logistical issues which were solved of course but yes, there is no problem with the internet. We are not consciously aware of the speed, yes.

Heather:        Tej, you describe yourself as a Growth Hacker.  What does that mean?

Tejasawi:       I mean that’s something I’m figuring out.

Heather:        It sounds very impressive. I actually like that title, ‘The Growth Hacker’.

Tejasawi:       Right, so how growth hacking works, it’s a term by an accounting marketer called Sean Ellis who is inbound marketeer and he has a start-up. What he says is like when you build a start-up, that is a predictable good … you can achieve. You can draw a straight line which is not a hockey stick but is like a 45 degree angle, right? What a growth hacker does or growth marketing is like it recognises certain bursts in the marketing cycle and exponentially recreates it. If the growth hacking is successful, you find an unconventional way of growing and you make it repeatable success. So that’s how you differentiate your start-up from the rest of the competition. You actually blow the competition off because you have tested and repeated success with an unconventional method. That’s what growth hacking, the term is coming from.

Heather:        That’s interesting. I should mention in there … I’m guessing I’m right, you’re referring to grass hockey rather than ice hockey for our North American listeners which is … actually would he be referring to ice hockey rather than grass hockey?

Tejasawi:       He’s an Australian guy so I don’t know.

Heather:        Because they’re two very differently shaped sticks, I know that.

Tejasawi:       Indeed. I think I get your point now because …

Heather:        So I think it’s actually the ice hockey stick he’s referring to isn’t it because that’s the one with the 45 degree angle, whereas the grass hockey stick is actually quite … very, very short.

Tejasawi:       I know it looked like that.

Heather:        I’ll go and Google it and see if I can work it out afterward.

You have, in the first year of launch, you managed to attain 250 paying customers with inbound marketing. How did you go about doing this?

Tejasawi:       We have an install base of 1,000 stores but when the free trial ends, that’s how the paying customer starts. We are a SASS based B2B company, product company. At the beginning we were very clear that we were targeting certain markets where these platforms have good penetration. For example, US, Canada, Australia and UK, right, where the amalgamation or the integration can serve a purpose immediately. We targeted those and we founded the channels which were the app stores. As a company, we didn’t invest in a sales asset team. We didn’t hire any sales persons. We only invested in customer success.

When I joined as a third team member in February of last year, I was straight away sent to customer support as a role. I didn’t go to marketing for the first four months. So what we learned from that is if you actually delight your customers from day one, they sell the app themselves. They write reviews. They talk about you. They recommend you to users and the Shopify system is pretty vital in that sense. People talk about their issues.

So we actually focused on two things. One was the forums, community forums, across the business apps and the second is to actually get good reviews on the platform. People read reviews before they read features actually, often.

Heather:        I completely agree with that, yes. Okay, let’s examine that a bit further.

In terms of the forums you were looking at, what forums were you looking at? Was there a specific Spotify forum?

Tejasawi:       Shopify and Bigcommerce …

Heather:        Shopify sorry. I said Spotify. Shopify, yes.

Tejasawi:       No, they’re very similar. Shopify has a very active business forum which is Shopify.com\forums. Even we actually got the business idea thanks to those forums because customers were talking about specific data, manual data problems, manual accounting problems. When you go to the forums, there will be these customers who talk about, “How do I move my data from Shopify to Xero?” “How do I manage accounting?” “What are the best practises of accounting?”

                        We position ZapStitch as a thought leader in those forums saying, “We know your pain point and we know how accounting can be a pain sometimes and how our solution solves it.” So rather than out-selling, we out-educated our competition in the forum. That’s a philosophy we believe in is that if you related the pain point, we talked about how you can move data seamlessly between Shopify and Xero, and automate the reporting and just focus on business reports rather than actually entering data. The forums were a great place where people were actually talking about the problems and we just plugged in ourselves as somebody who knows what they’re talking about and we can solve it.

Heather:        I think going on the forums is very smart. Also as well as it being authentic, I think it also probably gives you really good SEO because people go … I know I personally, I go in and search there, and I know people who have a high level of credibility and if they’re supporting a particular product I’ll go, “Okay, I don’t need to do extensive research on it because this person has said it’s okay, so I’m sure it will be okay.”

Tejasawi:       Right.

How did you encourage your clients to give you reviews?

Tejasawi:       Yes, that’s a good question. Many companies, product companies especially, have a way of irritating the customer in terms of reviews. They keep bugging the customer saying, “Why don’t you write a review?” “Give a link,” all those things. What we did innately or subtly was have a live chat support in our app. When the on-boarding happens, and TradeGecko is a great example where the onboarding is seamless, but when we started as a company we didn’t have that leverage of a beautiful design, an amazing out of the box design. We focused on simple and subtle design, and when the onboarding happened, the user got delighted and our automatic chat would plugin, “How did you find the experience?” “Do you need any help?” “What is the next setting you want?” All those things.

As the engagement happened in the live chat, we started to see the customers delighted and we can actually ask for review. It’s about instant gratification rather than sending them mail or calling them and saying, “How did you like the app?” The live chat client helped us a lot. I would recommend it to any product company starting out because that’s a great way to learn from customers on the spot and also solve the problems instantly and also, of course, write a review if the user is delighted.

Heather:        Yes, it sometimes amazes me that some of the companies are not as receptive to talk to an individual person. They’re like, “If you’re not a partner, I’m not going to talk to you,” and you’re like going, “Well, I need to talk to you before I consider becoming a partner.” Now, in terms of reviews, it sounds like you’re not focused on getting reviews on other sites. I know that Xero has an add-on marketplace and actually encourages people to review there.

Are you directing people to go and review there?

Tejasawi:       Yes, so with Xero, we just launched that Heather. We want to get as many reviews there but it’s just two to three weeks old and we actually started getting paying customers as well from Xero. I mean review becomes a natural …

Heather:        Progression in the cycle.

Tejasawi:       Yes, by-product of success. We want to ensure product success with Xero first and then the review I’m sure will be there but we are not biased in any platform as such.

Heather:        So for our listeners, we’ll just share with them that ZapStitch is now on the US Xero marketplace but you’re also looking for approval on the other country marketplaces. Is that correct?

Tejasawi:       Yes. I should give credit to Xero because they are one of the most active developer support forums out there. They’re very transparent in how they deal with partners like us.

Heather:        That’s sensational.

Tejasawi:       So unless customers actually say that sales type automation works with ZapStitch, they will not approve it. We have seen other apps which you are aware of, where community is like … you like your app, the customers like your app, okay you’re globally approved. Here it’s more like every country has a specific use case and unless you actually meet them practically and the customer talks about it, you are not approved. We had beta customers from the US and UK, so we got approved and UK should be very soon right now, and we want beta customers from Australia and New Zealand which is the biggest Xero user base, to approve it as soon as possible. That’s our main focus in February.

Heather:        Yes, sensational.

How many customers does ZapStitch need to be successful?

Tejasawi:       As a B2B company we are focused on two metrics, right? One is MRR  monthly recurring revenue, and second is to reduce churn. Rather than talking about the number of customers, we’re talking MMR in at least our philosophy, so we want to get to at least 100,000 MMR by end of year or by next year, early next year. That’s how we are growing and our month on month, at least to reach that, would be 35, we are at 38 this moment. We are going at a good speed but that’s how we look at our growth.

Heather:        Excellent.

You’ve targeted multiple markets to penetrate the cloud based software specifically in e-commerce and accounting, what have you observed through that and what have you learnt through that targeting of the different markets?

Tejasawi:       Right, so when we actually launched the beta product in 2013 end which is like December or November if I’m not wrong, I was not onboard. The founding team had tested it with Indian customers. The problem with Indian cloud or cloud eco system is they’re not very progressive or they haven’t understood the impact a cloud app can bring to their business. We still are believing in manual bookkeeping or CD based software of accounting, Excel sheets.

The penetration was getting harder and harder so we naturally went to the most progressive marketplace which is the US. They already know the pain points they have and they do actually look to build a multi-million dollar business within one or two years. The e-commerce stores there are built on Shopify or Bigcommerce were looking at, “How do I grow faster?” Accounting needs to be fast, needs to be painless. “How do I find the solution?” “Okay, ZapStitch is there.”

We got our first paying customers from the US, then Canada, so we started progressing in those geographies first and then UK and then Australia. So in terms of progressive eco systems for cloud software, we thought and we have analysed that US is by far the leader.

Heather:        Oh really?

Tejasawi:       Yes. In terms of multiple processes … they don’t look at one process to automate, they actually want to automate the whole business and focus on customer success, focus on sales, marketing, and the data is a burden to them. Right? They look at multiple apps to automate multiple sites of their business. Australia was a close second to that and Canada is very close to Australia.

Heather:        I would have thought from speaking to people, and I don’t have any stats behind me, it would have been New Zealand.

Tejasawi:       Yes, in terms of user base I’m talking.

Heather:        Okay, so in terms of user base, I completely agree because they’ve got such a bigger number.

Tejasawi:       Indeed, yes. I appreciate that because I was talking not in philosophy of approach to the business but in terms … I meant that, yes.

Heather:        The user base number, yes. As soon as you get the US buying into anything, you expand exponentially don’t you.

Tejasawi:       Yes, and I’m sure with Xero, we would test the New Zealand market much better because with Shopify and the other accounting app, we didn’t have much user base in New Zealand so we couldn’t get real data measured with that. But I’m sure Xero … I have seen the data that Xero is more in Australia and New Zealand already so that should be good data to work with.

Heather:        Yes.

How can customer service be a differentiator for start-ups in a competitive market?

Tejasawi:       When you look at cloud based business, there’s no geographical limitation. For example: we are an Indian company but working seamlessly for a US audience, right? We work in their time zones. Our support team works at US and UK time zones. When you come to a company … company to a marketplace, you have to find a differentiator. It cannot be price always. You can’t be the cheapest solution out there. That’s not a good business model to work with.

Heather:        Absolutely.

Tejasawi:       What you want to do is you want to delight your customers and if your app is not at the self-serving mode in the initial days, customer success or customer support is the easiest way to get that because as I said, businesses want to talk to a human at the end of the day. They don’t want to just write them email and get a response. They want to talk to a human. They want to relate to their problems. They want to talk about their problems. Our initial days or initial growth has to be credited to seamless customer support and of course a great product which enables delight.

                        I think from our learnings we can safely say that if you actually put in place tools to automate customer support, to have things like live chat, email automation, and then actually have a product which is centric to the user and not to a developer. You don’t need to be a scientist to use an app. If you look at those three verticals as customer success, you are already in a good path to grow outwardly so that would be our learning in that space.

What tool do you use for your live chat?

Tejasawi:       We use Olark. We have been a huge fan of Olark.

Heather:        Olark, okay. What email automation do you use?

Tejasawi:       For customer support we have two things. One is the support which is on Freshdesk and for customer interactions we use Intercom. What Intercom does is it gives you the app usage of every user, you know, “Has he done a sync? What type of data did he sync? Is he actually happy with the product?” All those customer analytics. We use Intercom and we send trigger emails based on the actions inside the app. That’s how our customer support cycle works, onboarding works.

If you’re dealing with people during business hours in the US, it sounds like you’re not getting much sleep over there.

Tejasawi:       No, we don’t work 18 hours a day. How we divide this is like the marketing and product team works in Indian hours and the support and the customer success team works in US hours.

Heather:        Okay.

Tejasawi:       As we expand into markets, I’m sure the whole team will find a challenge in the one or two weeks but we are a global company so we should act like one.

Heather:        Yes.

Do you have staff outside of India?

Tejasawi:       No, we are a 15 member team in Bangalore in India.

Heather:        That’s really large. That’s a really large team.

Do you attend any of the Xero roadshows or Xerocon events, the big Xero conferences?

Tejasawi:       Yes, we would love to because there are these industry specific events. I know as you mentioned people like you hang out there but right now we are not focused on that. That’s one differentiator we have …

Heather:        Your support is online rather than showing up at those events.

Tejasawi:       Exactly, we don’t have a sales team. Yes.

Heather:        Sensational.

Can you share with us some of the businesses using your solution?

Tejasawi:       Sure. One of the most successful businesses who was an early adopter of Zapstitch  is

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