This past week, I told my boss at work I’d be quitting my job to be the co-founder of a startup, Retrium. Over the years, I’ve had plenty of ideas — some more successful than others — but I never quit my job to work on them. One might reasonably ask: why go “all in” on this one? In other words, what makes Retrium different from my past entrepreneurial endeavors?
Good question! Here are three reasons why I believe Retrium has a really great shot at becoming a very successful company:
1. Broader Market Forces
Retrium is a toolbox of facilitated retrospective techniques built specifically for distributed scrum teams. If you’re not in my target market, that might sound like a jumble of jargon, but it sits at the intersection of two powerful market forces:
- The increasing popularity of remote work and distributed teams
- The incredible adoption rate of agile and scrum within the software development community
Let’s start with the first one: the increasing popularity of remote work and distributed teams. According to ESNA, 20% of the global workforce telecommutes. More anecdotally, we’ve recently witnessed the incredible popularity of websites like Nomad List, which provides information about the “best cities to live and work remotely”. We also have lengthy crowdsourced lists of startups with a distributed workforce. In short, companies have begun to realize the importance of hiring the best talent, regardless of location. This trend is only going to continue as technology gets better and better at reducing the friction of a distributed workforce.
The second market force is the incredible adoption rate of agile and scrum within the software development community. The jury has decided, and agile has won. What began as a simple manifesto has turned into powerful force that is helping teams produce better software, faster. This is true, of course, for the startups of Silicon Valley, but it’s just as true for the multinational enterprises of New York and the nonprofits of Washington, D.C. After all, who wouldn’t want to be more agile?
Clearly, there are plenty of pain points left to solve in both of these relatively nascent markets. Retrium solves one of them.
2. External Hooks That Naturally Reduce Churn
The biggest challenge to the sustainability and profitability of any SaaS company is customer churn. The simplest definition of churn is “the rate at which customers cancel their subscription.” Why is churn so important? For each customer that cancels their subscription, a company has to find another just to maintain current revenue. If a startup wants to grow, then its customer acquisition rate has to be greater than its churn rate. Clearly, the higher the churn rate, the harder this is to accomplish.
One of the best ways to reduce churn is to have a high level of user engagement. After all, users who are engaged with your product are less likely to cancel. One of the things that excites me most about Retrium is the fact that it has a high likelihood of having extremely low customer churn.
Retrium benefits from something I call an “external user engagement hook,” which is something that encourages customers to use your product from outside the product itself. Retrium’s external user engagement hook is the scrum framework, which requires teams to run retrospectives on a regular — and frequent — basis. The hope is that every time a team needs to run a retrospective, it will be reminded to use Retrium. Having an external user engagement hook can be an incredibly powerful driver of low churn, and it makes me confident in Retrium not only as a product, but as a business as well.
3. I’m Passionate About It
One of the worst mistakes a founder can make is to start a company in a market that he or she is not passionate about. Popular culture would have you believe that founding a startup will lead to a glamorous life full of parties and ritz. The reality is quite the opposite — startup life means hard work — really hard work. As a result, founders of startups can burnout quickly, especially those who start companies in markets they aren’t personally passionate about.
As for Retrium, I’m fortunate that it’s at the intersection of two areas I’m truly interested in: agile software development and distributed teams. In fact, Retrium itself is being built with these concepts at its core. Not only are we using the scrum framework to develop Retrium’s code, but we’re also a fully distributed workforce (we have no office).
None of this means that Retrium will, in fact, be successful. Most startups fail, and it’s far too easy to live in a positive echo chamber that can lead to overconfidence in your idea. Nonetheless, I truly believe the future for Retrium is bright. I’m excited to get going.
Coming soon: a post describing how I got the confidence to quit my job and start Retrium. I’ll give you a hint: Lean Startup.