Scaling LinkedIn Outreach Without Scaling Headcount

Machine-generated transcript from the episode video, cleaned for punctuation and names. Speaker labels are not included.

[0:05] Welcome to another episode of the GTM Vault Podcast. I'm your host Rick Koleta, and today we have Nick Velkovski, co-founder and CEO of HeyReach. HeyReach is a leading LinkedIn outreach tool tailored for agencies and sales teams to enhance their LinkedIn prospecting efforts. Today we'll explore HeyReach's go to market strategy, how they gained early adoption, identified their ideal customer profile, and pivoted to focus on their core users. Nick, thanks so much for being here. Thank you very much for having me here, Rick. Nick, I want to start off with what led you to create HeyReach, and what gap did you see in the LinkedIn outreach space? One thing to mention is that before HeyReach we had another product called Howitzer, and that was the world's first Reddit marketing automation software. It worked pretty similar to the product we have right now when it comes to LinkedIn automation, but it was specifically designed for Reddit. In the summer of 2022 we were thinking about

[1:09] peopleo think into something that's more B2B, where we don't have that steep sales learning curve when it comes to the users and adoption of the tool. So we were using bunch of LinkedIn outreach tools before that and none of them really offered us the scalability that we needed. All of them were built for individual users. That means one LinkedIn account running on one outreach campaign, and that's it. You want to scale the game, you have to have multiple, and log in, re-log in, switch context, and bunch of different things. So when we were in the process of pivoting from Howitzer to HeyReach, we did bunch of interviews with potential customers. Most of them were lead gen agencies actually, and when we mentioned the concept of multiple LinkedIn senders put on one outreach sequence and some of the core features that are currently USP, we got the wow reaction from their side. So pretty much it was kind of enough for us to decide to focus on this feature set and this differentiating

[2:10] factor, and pretty much that's how the whole concept of HeyReach was launched. We couldn't find a LinkedIn automation software that allowed us to scale like we wanted to scale. And how did you decide on the core features of HeyReach, the unified dashboard and inbox for multiple accounts? Yeah, so pretty much the feature set is similar to the one we had with Howitzer, the Reddit marketing tool. It was designed the same way. We had unlimited Reddit accounts on our previous tool, we had one unified inbox for all of them. And actually fun fact is, we internally started building an email outreach software that had unified inbox and unlimited email senders, but then we saw Instantly on AppSumo and we're like, oh amazing, there is a tool out there who is solving our problems, let's kind of kill the internal project and buy this thing. And by having a product built on unlimited senders with unified team inbox, and seeing another product emerging in the space applying the same concepts,

[3:14] we're like, okay, this is the direction that we need to go. We were quite positive from day one that unlimited senders and unified inbox and unified dashboard is the way to go, to simplify everything, and to allow the scalability and to centralize at one place with as less clicks as possible. You acquire your first users. What strategies help you gain initial traction? The first couple of months were kind of, I would say, bumpy. The first user that we got was from the free beta that we launched, because when we launched HeyReach first, we allowed everyone to use it for free. It was 30 days free usage. A bunch of people jumped on it, used it, and we thought, okay, we are going to convert, it's amazing. We had 200 users in the beta period, and when the beta period ended, guess how many of them paid for the tool? Only one person. Only one person converted. And

[4:18] I was like, okay, wait, wait, wait, wait, I expected at least 10, 20 people to convert from the beta users. Only one person started paying for it. We started, we tried everything at the beginning. We tried selling, we tried, we didn't try ads, but we tried outreaching to agencies, we tried outreaching to salespeople, we tried outreaching to even individuals, to recruiters. We couldn't scale past $8,000 MRR until October 2023, and our first pay customer was in April or May 2023. So it was kind of a really bumpy summer. We were running out of money at that point as well, so we were pretty much unfundable. We couldn't raise with the MRR that we had, and all of the turbulences and the pivoting and stuff like that. So we launched on AppSumo, that's a platform where you can launch lifetime deals. We became number one bestselling tool on their platform. We launched on AppSumo, we made total of 400,000 in seven days. So I

[5:23] would say the first adopters and the first users were the AppSumo audience. We were really really struggling until we decided to niche down to the lead gen agencies in October, and that's when we started pretty much growing. So the process of finding your ICP and finding your niche market and finding something I call niche market fit is a really bumpy road, and you have to go it. Until we decided to niche down, we couldn't pretty much grow. We didn't know who we were selling to. You have to try everything and see where your product fits and double down on what works. Can you share some of the key insights that guided you in this process of identifying your ideal customer profile? Right, so as I told you, we tried selling in every possible way. We even got a super experienced head of sales to join the team, after that she left. We tried working with a consultant to help us find our ICP, we tried battle cards, we tried every technique there is. I was learning formal way of doing sales and so on, but nothing even ever changed

[6:27] until my revenue guy Elia came to me and he was like, dude, we have had 597 calls and I do believe that we need to niche down to lead gen agencies. The tool is not, the state of the tool is not built for recruiters. I was really pushing on the recruiter vertical. I thought, okay, we can sell really good to recruiters, because when I'm jumping on a sales call with them and when I show them what we can do, they're like, wow, and they're working most on LinkedIn, because there is no other way to reach people besides cold calling and LinkedIn when you're a recruiter. And I was like 95% sure that we should go for the recruiters, but my revenue guy, based on all of the sales calls we have had, he was quite positive that we should go to the lead gen agencies vertical. So what we did, changed the website wording, positioned it to lead gen agencies, changed the pricing to position it to be friendly for lead gen agencies, and started communicating that we are a LinkedIn outreach tool made for lead gen agencies. And the next month we 2.5x'd our revenue and started growing like this. Before that now it was

[7:33] a fluctuating revenue. We were at 8K MRR I think in October, November we were 19, and December we were 13. So it was this type of growth. Clear signs from the market that okay, this is the direction that we need to take. Can you share a bit about the technology behind HeyReach and how does it support scalability? Right, so the back end is in .NET Core and there's some part in Node.js, the front end is in Angular with Tailwind, hosting is AWS of course. And yeah, it's a huge system. I'm coming from technical background and even I'm not on hold on what's everything that's happening behind the tool, but I know that we have really really solid automation, because we can be the, we are the only tool on the market. Right now we have 7,500 LinkedIn accounts active and running on the platform and we have never had a suspended or ban account or something like that, unlike the other

[8:35] tools that are doing it on the market. We're super focused on the safety and on the way we are automating the things. So in a competitive market, how does HeyReach stand out from other LinkedIn outreach tools? Right, so I would say that HeyReach is built for scalability while the most of the tools on the market are built for individual users. Right now there is no other LinkedIn automation software that allows you to have unlimited LinkedIn senders put on one outreach sequence and a unified inbox where you can have all of the conversations from all of the leads from all of the LinkedIn accounts at the same time. So the differentiating point is that we are built for scalability and for scaling LinkedIn outreach. We are also super granular when it comes to what you can do LinkedIn in terms of automation, and the other factor is the integrations. We are heavily integrating with other tools, and the whole goal is to give a seamless experience where you can utilize your whole outbound stack within HeyReach. We are

[9:38] not going multi-channel or building cold calling, email, LinkedIn and trying to be a sales engagement platform. We're trying to integrate with platforms that people are already using and helping them centralize their LinkedIn strategy within other most used outbound stack. So that's why you're seeing Clay and SML and Series, the combo of data prospecting and LinkedIn outreach on email and LinkedIn. Has there been specific growth tactic you can point to as the main lever of growth for HeyReach? I wouldn't say it's a tactic, but I would say it's niche down to expand. For us niching down was the way to expand and the way to grow. The other aspect I would say is the customer support. We really care about customers and we are, I can say that we are 100% customer driven company, because our immediate roadmap, our closed lost deals and our churn reasons from the customers. So we

[10:41] are having breakdown on how much revenue we lost, how much customers we lost, what are the reasons that we lost our customers. We pack all of that, put it into the roadmap of the devs, they're executing it, then reaching out to the closed lost customers and slowly kind of expanding on what really the customer needs and what really the customer wants. So I would say being customer centric and niching down are the mindset aspects. I wouldn't even say growth levers, I would say mindset aspects that are key behind the growth. The growth we have is 100% organic so far. We're generating 2,000 free trial signups per month just by people talking about what we doing, and sharing their results and talking about HeyReach and their outbound stack. And recently we just started doing outbound again, so we can pump on those numbers. But yeah, I would say the mindset stuff, to

[11:44] summarize the mindset stuff, customer centric approach to stuff, niche down to expand, and organic. And do you have any product driven growth motion in place? Not yet, not yet. We are focused heavily on the sales-led motion at the moment. Most agencies and bigger sales teams who are coming to the platform, and the PLG aspect is still not intact. That's something that we'll be working for. Got it. What trends do you see in sales automation and how is HeyReach adapting? Right, so one of the things I'm seeing is the legacy tools are being replaced with the new kids on the block tools like Clay, 3y rbb, Instantly, Smartlead and so on, who heavily replacing the outbound stack that we knew until a year or two ago. So we are pretty much applying the same techniques and targeting pretty similar

[12:47] audience like these tools I mentioned. Other thing that I'm seeing is slowly the per user pricing is going away, so people are focusing more on unlimited senders, scaling in terms of one SDR or one BDR managing multiple senders. And with the AI and all of those things, I really do believe that the sales teams are going to be reduced. I don't believe that the AI sales co-pilot is going to replace the person in a significant time from now. That's one market trend that I'm seeing, and I kind of don't follow the AI co-pilot versus AI assistant. I really do believe that the sales is, the future of sales is AI assistant and not a co-pilot. And yeah, integrations, integrations as well. I'm seeing that the outbound tools are kind of integrating between themselves, and Clay is pretty much the new category creator that enables all of this and kind of set the trend of integrating and collaborating between tools. So yeah, I think we're on track with both of those things that

[13:50] they. Any advice for entrepreneurs building tools for sales and marketing teams? Be obsessed with the space. To be obsessed with the space, follow where is it going, critically talk with people about the direction where the GTM and the CSP space is going. That's the aspect of GTM tools that I could address. You need to be one step ahead of everything else on the market, and you need to deeply deeply deeply understand what you're doing and why you're doing that. And another more general advice that I would give is just ship it, just launch it. It doesn't have to be perfect, it doesn't have to be breakthrough, it doesn't have to be your final vision that you want to build in a couple of months or years from now. Just launch it, listen to the feedback from the market and iterate on that thing. I don't believe that you can just launch it and be immediate hit and find the product market fit immediately. That's really rare. Launch something that you believe is good enough and solves a problem and then iterate on it, listen to your customers, talk with your customers and focus on

[14:52] learning how to sell your tool, focus on learning how the people are talking about your tool, listen to their wordings, implement into what you're building and just follow the market feedback and build. Be that loop of following feedback and building. So yeah, don't overthink it so much, just ship it and follow what the market says. Nick, thanks so much for joining us, it's been a pleasure. Thank you very much for having me here, Rick.