Hey everyone, in today’s episode, I share the mic with André Siqueira, co-founder of RD Station, a digital marketing software company based in Brazil.
Listen as André discusses how they were able to secure significant investments (the largest amount in Latin America) despite the political state of Brazil, their struggle with customer retention and their bold decision to do event marketing—something that is not very common in Brazil—and the fact that their biggest competitors in Brazil are businesses who don’t understand inbound marketing.
Download podcast transcript [PDF] here: How RD Station Continues to Double Its Growth Rate Each Year (After Raising $19M) TRANSCRIPT
Time-Stamped Show Notes:
- 00:55 – Eric introduces André to the podcast
- 01:01 – Eric went to the RD Summit last year
- 01:27 – André is the head of marketing at RD Station
- 01:31 – RD is now the leading marketing automation platform, in Latin America, with almost 7,000 customers and 400 employees
- 01:58 – They have just raised $19M last year in funding from TPG
- 02:22 – The $19M funds RD Station raised is one of the largest amounts raised in Latin America, last year
- 02:43 – Despite the political issues happening in Brazil, RD Station was still able to secure investor funds
- 03:13 – All RD Station’s metrics performed well which helped them secure the funds
- 03:41 – The company has 7,000 customers
- 03:48 – Customers pay an average of $150 per month
- 04:20 – RD Station’s counterpart in the US is HubSpot or Infusionsoft with much lower pricing
- 05:22 – RD Station had less than 300 employees last year and now, they have roughly about 400
- 05:52 – It’s harder to find employees in Brazil than in the US
- 06:33 – The company’s growth rate has been doubling for the past couple of years
- 07:02 – Unlike HubSpot and Infusionsoft, RD Station has no CRM and CMS
- 07:40 – RD Station’s templates are less than their competitors’
- 08:19 – André talks about acquiring their first 1000 customers
- 08:31 – They offered consulting services
- 09:03 – They started a blog and put up resources to create an audience
- 09:14 – When their software was ready to launch, they already compiled about 20,000 emails
- 09:43 – They did more of the inbound marketing which helped them acquire more customers
- 10:23 – They did events as well
- 10:38 – RD Station’s main blog now publishes 40 posts per month
- 10:56 – They tested the frequency of posts last year and they found out 1 post per day is their saturation point
- 11:29 – RD Station also started other kinds of blogs about agencies
- 12:16 – Event marketing with RD Station
- 12:26 – With 400 customers, RD Station decided to create an event to get to know their market better
- 12:49 – The summits/events are not really popular in Brazil
- 13:24 – It was RD Station’s advantage to host the event
- 13:57 – The summit became the beginning of a huge community they now have in their country
- 14:08 – RD on the Road is their program where they get to know their clients around Brazil
- 15:00 – Their relationship with customers plays a big part in customer retention
- 15:22 – Their biggest competitors in Brazil are businesses who don’t understand inbound marketing
- 16:01 – The first RD Summit had 300 attendees
- 16:16 – “Starting small is important”
- 17:08 – Their attendees are their followers
- 17:46 – The summit also became famous in Brazil
- 18:01 – Apart from emailing leads, RD Station used Facebook to promote their summit
- 18:37 – RD Station’s event sponsors also promote the event
- 18:56 – They also hire a PR Firm to get media coverage
- 19:36 – The first and second summits cost around $20,000
- 20:00 – They usually break even from the ticket sales and profits from actual sales
- 20:25 – What’s one big struggle you faced while growing RD Station? – “It would be customer retention”
- 22:13 – Investing in customer retention was really hard with RD Station at the start
- 22:30 – Understand your customer portfolio
- 23:38 – What’s one piece of advice you’d give to your 20-year old self? – “Focus on what you’re good at”
- 24:49 – What’s one big change you’ve made in the past year that has impacted you or your business in a big way? – “Understanding my role and the things I’m good at”
- 26:00 – What’s one must-read book do you recommend? – Traction
- 26:59 – Connect with André on LinkedIn, Twitter, or on his email
3 Key Points:
- Providing value to your audience can be the gateway to acquiring customers.
- You don’t have to do BIG the first time you try – start small.
- Do not go after every person – know the kind of customers that you’d like to target.
Resources From This Interview:
- RD Station
- RD on the Road
- Must-read book: Traction: Get a Grip on Your Business by Gabriel Weinberg
- André on LinkedIn
- André on Twitter
- André’s email
Leave Some Feedback:
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Connect With Eric Siu:
Disclaimer: As with any digital marketing campaign, your individual results may vary.
Full Transcript of The Episode
Speaker 1: Do you want to impact the world and still turn a profit? Then you're in the right place. Welcome to Growth Everywhere; this is the show where you'll find real conversations with real entrepreneurs. They'll share everything from their biggest struggle to the exact strategies they use on a daily basis. So if you're ready for a value-packed interview, listen on. Here's your host, Eric Siu.
Eric Siu: Before we jump into today's interview, if you guys could leave a review and a rating, and also subscribe as well, that would be a huge help to the podcast. So, if you actually enjoy the content and you'd like to hear more of it, please support us by leaving us a review and a subscribe to the podcast as well. Thanks so much.
All right everybody, today we have Andre Siqueira, who is one of the co founders of RD Station. Now Andre has had me at one of the biggest conferences in South America, their digital marketing conference which is called RD Summit, which is awesome, couple thousand people there. Andre, how's it going?
Andre Siqueira: I'm great, Eric, it's a great pleasure for me to be here chatting with you, and I hope we have some nice talking here and we can provide good thoughts for anyone listening.
Eric Siu: Absolutely. So why don't you tell us a little bit about who you are and what you do?
Andre Siqueira: Great, well I'm the head of marketing at RD Station, we are right now the leading marketing information platform in Latin America, with focus on Brazil. We are now close to 7000 customers in around five years of software. And we have right now 400 employees here, we've grown 2.5x this last year, 3 times the year before, and 5 times the year before so we've been doing good for a good series of years. And we just raised, last year, 19 million dollars in funding with TPG as lead investor. So that makes us a more solid company here, we have like a good competitive advantages for Latin America countries, and we are ready to reach the level of the companies in the U.S. I guess.
Eric Siu: Awesome, great. And raising 19 million from TPG, which is one of the biggest firms, I mean that's not a small amount of money. Was that one of the biggest rounds raised last year in Latin America?
Andre Siqueira: Yeah, I'm pretty sure it is, and I mean it puts us in the same portfolio as companies like Uber, Spotify, and Airbnb, and many others. So it's pretty hard, and the timing is really hard for us in Brazil as well. We don't have like the currency in a good shape, in a good moment. We have some political problems here, we have the President impeached, and it's not a good moment to invest in the country itself so it was a tough process for us. But we have good metrics, we have good customer retention, we have an excellent customer acquisition cost. So all of our metrics we're doing good, and it was a bit easier for them to invest because of those
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reasons, but I don't think there were many other companies getting that amount of money. Especially in this B2B scene, I mean we have some FinTech companies here in Brazil doing good as well. We have some other types of companies, but in this type of context I think it was pretty relevant.
Eric Siu: Got it. Okay, so you have 7000 paying customers at the moment, right?
Andre Siqueira: Yeah.
Eric Siu: Okay, and how does that work? I mean how much are they generally paying you per month?
Andre Siqueira: Well they pay on the average of around 500 reais, which is, I would say, 150 dollars. So that's the average, we have different packages, we have like Basic, Pro, and Enterprise and we charge them based on the number of leads they generate. So the thing for us is that they can start smaller and get some success and after that we can charge a bit more. I don't think it's like, in America you could compare it to HubSpot, or Infusionsoft, or anything like that, but our pricing is way lower than theirs. And that's pretty important if you go to America, like Brazil itself. So many small and medium businesses are really price sensitive, so you have to get a structure that can afford a lower ticket, and at the same time provide some selling with [inaudible 00:04:47] customer success structure, anything like that. So it's really hard to make the mathematics work for your company.
Eric Siu: Got it. Okay, so the 7000 paying customers a month: now I'm just being conservative here, let's just assume they all pay 150, even though you guys have different packages. So on the conservative end, that means you guys are basically making, you know a million bucks a month, which is fantastic. 12 million a year. So can you talk about some other metrics around the company? You talked about number of employees and growth rates.
Andre Siqueira: Yeah, we've been growing, we have like 500 employees now. We ended last year with less than 300, the year before with 150 or so. So it's been some [inaudible 00:05:33] since we have been funded. Before TPG we had been funded by Redpoint eventures and some other Brazilian funds. So every time we get some more money, we have this spikes of hiring here. It's really hard for us to do it here, because it's different from the U.S. in the sense that you have people who worked in digital marketing for a long time, you have people who work with customer success or inside sales or things like that.
And right here, we can't just find those people, so you have to hire like someone junior from, like they just graduate or anything like that so you have to train them. So that's one thing we had to improve a lot, so we have a good training system here so we can prepare people to get ready to work right, without never doing the thing they are supposed to do. And about the growth rate, I said it before, we've been at least doubling the last years and our projections say we'll still double in the next two years.
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Eric Siu: Wow. Okay, great. So obviously you mentioned there's, you obviously can't charge as much as like a HubSpot or Infusionsoft, so the price has to be lower. So what makes your product different than the other ones? I'm sure you had to strip some things out and then add some other things. I'm just wondering how your product is fundamentally different than the two competitors in the U.S. that you mentioned.
Andre Siqueira: Okay, I don't think we have, for example HubSpot right now has CRM, so we don't have a CRM, I think Infusionsoft has some sort of CRM as well. And we don't have a CMS so we have SEO features, we have marketing automation features, email marketing, we have LIT management feature. A few features last, like the CTA's as well, we don't have it. But if you take a look into each feature, we usually have a few more ... a few less possibilities than theirs. So if you take for example the number of templates we have for [inaudible 00:07:42] or email marketing it's probably limited if you'll compare. But at the same time, that's an important thing here because when you add too much things they tend to get complex. So if you're talking to a less mature market, people who are not training for doing it, they don't know the concepts yet and things like that. You have to make it way easier for them to understand and to use the tool itself. So that's not just because we started later than them, but that's because the country needs this kind of approach as well.
Eric Siu: Great, so let's talk about the first 1000 customers. How did you go about acquiring the first 1000 customers?
Andre Siqueira: When we first started the company, we always wanted to be a software company. That was our goal, but we started offering consulting service because that was a good way for us to monetize from day one. We were both strapping at that time, and more important than that, we were learning how our customers deal with this issue. So we are learning what were their pinpoints, what person [inaudible 00:08:48], what kind of messaging works for them anything like that.
So we sold this consulting service to around 20 or 30 companies using our network. But while we were doing it, we had already started a blog and launching new eBooks and other kind of resources. So we started from the day 1 to create an audience, and when we had the first version of the software ready to launch we already had like 20000 emails and things like that so we just sent an email saying we were launching a new project. And they could try it, they could use it free for one month or so, and they could ask us to make a demo or anything like that. So it was really easy to go from 0 to 100, 200 customers, because we already had this audience before. And after that, it was just a matter of creating more content and getting this Inbound process better.
So Inbound marketing is our core, so most of our customers come from it. And we have a huge blog here in Brazil, so we have a huge audience, more than half a million visitors a month. We have like many eBooks that became like reference for people studying the subject here. So we started producing more and more and making it always better, so that was the main point for us, to get from 0 to 1000
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customers. At that point, we started doing other things as well, so we had our Event Strategy, we had other things starting but the beginning of all was Inbound marketing always, content marketing.
Eric Siu: Great. And so, to get to the 500,000 visitors a month, I mean how much content were you producing each month?
Andre Siqueira: Right now we produce like, in the main blog, around 40 posts a month. It was not always like that, in the very beginning it was like once or twice a month, sorry, a week. And after that, we are doing better, we are generating good numbers, and last year we had like many tests. We tried to raise the frequency, so we tried to post twice a day. Tried to slow down a little bit, so we were doing like one post or even sometimes less than that.
And we found that around one post a day is our separation point. So if we have to write like two or three posts a day, our numbers usually don't change that much, it makes no difference. So we decided to settle on that frequency, and we also started other kind of blogs. For example, we have right now our chain of programs, so we have marketing agencies as partners. And right now it's like 40% of our revenue, so we started a new blog just for agencies. So we talk about the agent's business, how they can sell better, how can they keep their customers, and things like that.
And in this kind of ... in this post we produce less content, for example we produce usually one or once or twice a week. There are a few other blogs, there are a few other movements, but in the main blog I would say it's around 30, 40 blog posts a month.
Eric Siu: Got it, okay. So I want to jump over to the events marketing. And I'm assuming this ties into RD Station as well, so talk about how ... why you guys decided to go into events marketing and what kind of results it's brought you so far?
Andre Siqueira: Yeah, we started like, we had, at that time, around 400 customers; we decided like last minute, okay we're going to put up an event here. We want to get closer to our customers to understand them better and to share with them what we have been learning. We created this first event here, the first edition of RD Summit. It went well, and we had this feeling that we could do way better the next years. I don't think we have, in Brazil, anything like RD Summit right now because in this last year we were here we had like 5.5 thousand people here with tents and [inaudible 00:13:01] and many people from all over the world. And we saw that we could do it here. Like there was no one doing, it's a model that's already doing good in the U.S., we have these benchmarks, we have, we see things like DreamSpark for example. And we say why not try to do something like that here?
It's really good for us because usually sale of using computer or Skype or anything like that via inside sales, and when we got this event, it was a great chance for us to really meet our customers, to make them come here, and to talk to their
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consultants and to talk to their sales guy or anything like that. And when you're in a Latin country, that kind of contact matters, people like to be close, they like to know the people they are talking to. And this was like the beginning of a huge community we have created here. So we started with RD Summit, which is our biggest event, but we also have done, in the last two years, RD on the road. So we have this event that travels around Brazil and it's a way for us to get to know even more customers and to be close with them, to visit them in their agency, in their company. Just to ... sometimes we have like clients that they are thinking about starting Inbound marketing, they are thinking about hiring us, but they are not that sure. So it's a chance for them to go there, to get to know us better, and it really works.
We sell a lot in this kind of event, we share a lot of information and make the market itself more mature. This kind of opportunity has a barrier, a competitive barrier with some other foreigner lenders like HubSpot or Infusionsoft itself. So this kind of relationship we have with our customers makes them stay with us longer for sure. Beside that, it's a huge thing for branding, there are many things that get us, get to know RD itself, and our speakers, and our team just because of the events. So I'm pretty sure it's a good investment. Mainly if you consider that our biggest competitor here in Brazil, it's not HubSpot, it's not Infusionsoft, it's that businesses don't know what is inbound marketing, or they don't know how to do it.
So when we have this kind of investment and we get attention, we get people to talk about the subject, we get people to share photos and things like that, and people start asking, "Okay, what is this thing?" This is the main poi- the main part for us, so it's generating demand in a market that's not mature yet.
Eric Siu: Let's back up a second. When you talk about getting to 5500 attendees that's a huge amount. How many attendees did you have for your first RD Summit?
Andre Siqueira: It was around 300.
Eric Siu: 300, okay. So how did you go about getting the first 300, you know, you had an audience pre-built already, I'm just trying to give people some steps in terms of if they want to go into live events, how did you guys do it? What are the steps you took?
Andre Siqueira: Well, I think starting small was important, because we didn't have this event culture here in the company. We learn a lot every time we make an event because every time the event's different. So when we started we had these 300 people here, and it was really interesting because we have this agenda and by the end of the day we were asking how people felt about it. And they said okay, in the morning, some people said okay the morning was too basic like just an Intro, and the afternoon was too advanced. Usually people were in one side or the other complaining about the other part, so in the next year we could separate and create simultaneous tracks. So we have a track for beginners, and a track for advanced.
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Eric Siu: Just so, how did you go about getting the first 300, and then how did you start increasing the numbers? I'm just trying to figure out for people how you guys started to get actual attendees.
Andre Siqueira: Okay, it actually followed the company itself, because we kept growing our audience to sell them through Inbound marketing. And it's curious because the number of attendees we have in the RD Summit is usually the same amount of customers we have in our base. Not that every customer goes to the event itself, but usually we have the same amount because it reflects the size of the audience we have. So we kept producing content, creating more content, generating more audience, and that made us a better attractive company, a better attractive event itself. Also the event itself became famous, right? It got some media, it got famous, so it started walking by itself.
Eric Siu: What did you do exactly? Did you email your lists? Did you set like a Facebook event and then drive traffic there? How did you get people to actually sign up for the event?
Andre Siqueira: Yeah we have a huge email list, so we email them all the time; but at the same time, we have like Facebook custom audience to our customers. We use lead scoring, so we try to understand which customers are more engaged. So we try to focus on those customers with more budget than the others. We have retargeting, so we use lots of retargeting. We have pricing, getting higher like every month, so we can use that as a compelling thing to make them buy tickets before.
We usually have many sponsors at the event, and we use those sponsors to promote the event as well. So we always prepare a good email template for them, and ask them to promote to their database. We also give them discounts or things like that so they can use it to their customer base. We usually have a good PR firm as well, so we try to get into the main media channels. I think that's pretty much most of it; we also ask the speakers to promote the event as well. So most of our speakers are famous here in Brazil. They have their own audience, and people who follow them, so we create some pictures or things like that about the event and ask them to share. So there are many things we put together to get this kind of audience here.
Eric Siu: So what kind of costs were involved with the first RD Summit, and what kind of ROI do you think you received?
Andre Siqueira: The first RD Summit was like really last-minute made, and we had like, it was about 20,000 dollars or anything like that. So it was really, really simple, but we could like ... in every RD Summit, what we try to do is that, we try to break even, ticket selling, and the and sponsorships. So we usually break even on the tickets with the event cost, and our profit actually came from the software sales. So last year, for example, we had like over 100 licenses sold just during the event. And that makes it profitable, beside the branding itself. But we always aim for the event to pay itself, we try to always break even, that's our mantra.
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Eric Siu: Awesome, okay; so tell me about one big struggle you faced while growing RD Station.
Andre Siqueira: I have to say, if I look at the whole company itself, it would be customer retention. When we started, we were willing to sell to pretty much anyone who wanted to buy, and we found out a bit later that many of those customers would leave. Marketing automations is a complex area, so it demands effort, resources, understanding on how to operate it. And many times it needs behavior changes inside the company, so you have to make things different. You have to think different, have to think about content performance and not just by media like many companies do here. So not every company can afford it, or are willing to do it, and it's hard even for those who can afford it. So besides having a better understanding of who are our pretty good and bad customers, we had to create this customer success area and find ways to help our clients to reach the success they need to be here with us for more time.
So we now have created a step-by-step methodology they can follow, so we use it. We track it to understand in which part most customers are, and where should we work on to get better and to help them better. We have a great [inaudible 00:21:50] process, so whenever a client goes through this process he gets like three times higher chance of staying with us longer. We have quarterly business review with our clients so we felt that we really need to be closer to our customers to make it work. So we are refining the mod and trying to understand other things. I think investing in customer retention was something really hard for us; if we could start again, we probably would look at it before.
Eric Siu: Got it, so, I'm hearing customer retention, but I'm also hearing at the same time it's a lot about the targeting too. So it sounds like a lot of customer development.
Andre Siqueira: Yeah it's marketing as well, it's understanding your ideal customer profile, I mean because the need itself, every company needs more clients so there are many companies willing to do it. But the way we provide more clients, through content through this kind of process is not for everybody. So, for example, we had many local businesses here, that they wanted to bring more customers, they were willing to invest in the tool itself, but it was not a good fit for them and it was not the best way for them to do this kind of work. So we had to make our work here to understand which kind of customers fit better and what was our ideal customer profile to market to them, to sell to them, and we could filter here in our sales process.
Eric Siu: Great, okay. So I wanna shift gears here, I mean it sounds like everything is going great for you guys, you guys have gotten investments from some of the best firms in well, the world. And events are kicking butt for you guys. But for you, I mean, how old are you right now?
Andre Siqueira: I'm 27.
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Eric Siu: 27? Okay, what's one piece of advice you'd give to your 20 year-old self?
Andre Siqueira: Well, that's a good question; I think that one thing that's is applicable, and is a good learning. It might sound a bit silly and obvious, but my advice is to focus on what you're good at. I mean, sometimes we hear that we are not doing good in A, B, or C, and we put all of our effort in learning, and getting advices, and trying to prove it. We spend lots of times on it, and we can't move from really bad to just bad you know? Sometimes instead of that, I mean, okay in this kind of thing I'm not good on and it's okay to be bad in a thing or other. I maybe can hire someone who is good on it, I can delegate to someone, but what are the things that I'm naturally good and I can easily do, and if I invest time on it I can probably have a way better output so it's about structuring the company and the area or whatever about my strengths. That's something I think I could have learned before, and makes my life way better right now.
Eric Siu: Love it, okay. What's one big change you've made in the last year that's impacted either you or your business in a big way?
Andre Siqueira: I think was understanding my in this kind of sense, understanding my role and the things I'm good at. For example, I'm not that kind of leader that is really motivating guy that puts people like energize people or thing like that. That's the kind of thing I'm not good on it and probably is better for me to work on strategy to think about approaches we can do to our marketing, how we have a better mix of investments, [inaudible 00:25:23] creating reports, preparing reports. That's the kind of thing I'm good on it, so I stopped doing the other things, I was not that good and I think the company itself has made my relationship with my employees better, made the results itself better. So trying to understand what kind of things could have a higher impact and focus on those things was a good change I had last year. And I think can make a huge difference for anyone listening.
Eric Siu: Love it, okay. What's one must-read book you'd recommend to everyone? Ideally, can be any kind of book, could be fiction, nonfiction, can be Brazilian.
Andre Siqueira: Well, one book, probably someone have already recommended it here, but I think was a great writing was Traction by Gabriel Weinberg. It's a great read for [inaudible 00:26:23] entrepreneurs to think about how can they bring their product to the customers, what kind of channel they can use, and what are the main points about each channel? It was a great reading for us at RD and made us think about how we could use different channels. I mean, we already have some channels working, but what other kind of things we could do and how we could structure our marketing strategy better around those channels.
Eric Siu: All right, great. Well, Andre, this has been fantastic. What's the best way for people to find you online?
Andre Siqueira: Well you can find me on LinkedIn, I have my profile it's andregcsequeira, I think
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you're probably right because I don't think English speakers will probably get it easy. But you can find me on LinkedIn, you can find me on Twitter, andresequeira, you can email at [email protected]
Eric Siu: Thanks again for doing this Andre.
Andre Siqueira: It was a great pleasure, thank you Eric, see you soon.
Speaker 1: Thanks for listening to this episode of Growth Everywhere. If you loved what you heard, be sure to head back to growtheverywhere.com for today's show notes and a ton of additional resources. But before you go, hit the subscribe button to avoid missing out on next week's value-packed interview. Enjoy the rest of your week, and remember to take action and continue growing.