Cyan Ta’eed on the Success Story and the MVP’s of Envato
“We fluked it. We learned our lesson. We test before we invest.”
Co-Founder and Executive Director of Envato Cyan Ta’eed shared her insights on her SydStart keynote, A Tech Success Story and the MVP’s - The Macro and Micro of Envato.
“We’ve been successful. It’s a successful business. But it might interest you to know that if we had to do it again, we would do things very, very differently.”
“What we like to do these days is we like to take quite a lean, iterative approach, so we launch leanly, we test, we get some customers, we learn everything we can from them, and we sort of pivot the product as we need to.”
Cyan presented a case study on Envato Photos and shared 9 Steps on how they worked their way to launching quickly and iterating.
Step 1. The Idea and the Success Metrics
“The one thing that we didn’t have that people need is custom photography.” How about UBER for photo shoots?
The pitch: “We’re going to make it really easy to book a photographer and they’ll come to you when you need them.”
Measuring the idea against their success metrics:
$20,000 is a lean budget but they were low on time and wanted to get a turnaround really quickly so they can invest on getting a high volume of customers in order to test scalability.
In terms of profitability, when you have service providers and customers, you need to make sure that what the customers are willing to pay at scale is what your service providers are what willing to be paid.
Step 2. The Offering
Work out the offering and how it would work. Their model is:
Step 3. Build the Bare Minimum and Launch
Cyan and her team got a WordPress website resulting in just a couple of days turnaround. She explained the benefit of editing your own website AND saving more money in the process. She added that you’re better off launching with a more basic website like Wix or Weebly to get the site live right away.
Envato Photos used vouchers to track where people were coming from. Cyan said this is a low-tech way to do so, but was helpful for them.
The team spread the word about Envato Photos by reaching out directly to their customers through their mailing list, sharing posts on social media, promoting their business on local startup events, and handing out business cards and saying they’ll shoot for free.
In the first two weeks, Envato Photos didn’t have any customers, and Cyan thought, “This is the idea that the world has been waiting for! Why isn’t everybody jumping over themselves to get on board with this immediately?”. Startups must remember to factor in lead time. In their first month, Envato Photos got four customers.
Step 4. Getting to Know Our Customers
“We treated them like royalty, we gave them photoshoots for free...” The Envato team made sure everything went well. They also found out that their customers are all small business owners.
They also discovered that their customers wanted help in finding a good photographer -- someone with clear pricing, has clarity on copyright, and is secured in working with a brand they can trust. These are solid reasons that they obtained from knowing their customers well by directly speaking to and working with them.
Step 5. Exploring Customer Acquisition
Cyan and the team tried AdWords, Facebook, YouTube, and events acquire customers. Facebook was especially helpful to them, particularly videos on case studies and calls to action that say “You can trust us, we’ll help you”. She notes that this is a great way to get customers back to the site.
From there, they summed up 48% of returning visitors, with an average of 4 minutes spent on the site. They thought that was pretty good but these customers weren’t converting. What tipped them over was putting an inquiry form on the site so customers could directly tell them what they’re looking for.
Step 6. Testing Our Price Point
Testing the price point came at the time when Envato Photos were fully booked on their services. Cyan tried increasing their price by $100 (from $249 to $349). There was a slight decrease in bookings but these still came in. She decided there was more wiggle room for increasing the price.
Step 7. Refining the Process
Cyan cited a few more obstacles down the line:
They found solutions to these and took a big load off their shoulders.
Step 8. Finding the Photographers
Cyan was nervous about this because it is a disruptive product. However, they were relatively confident that what they were offering had real value for them.
Step 9. Scaling
Photo shoots are highly variable, and Envato Photos haven’t found an automated way to replace the whole process they needed to go through with new customers. To make this MVP a success, they really had to find a way to automate, otherwise they can’t scale the business the way they want to. So they decided to test more and try other things to see what happens.
At this point, Cyan introduced the power of lean -- where you get high insight at a low investment. In the last three months, Envato Photos have gone this far with quite a low investment, reaching a really good position to solve their problems. While they’re not sure whether they can fix the scaling issue long term or not, they still have to see.
Cyan ended her presentation with a quote:
Envato has 6 million members and 10,000 sellers, with US$300 million in seller earnings -- 48 of whom have earned over $1 million. Envato is also the largest digital marketplace in the world.