Why I ended up firing more than half of my customers

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Jon: Give me a little bit of chronology. What year were we in?

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Raad: I’ve been working on this for quite some bit. When we originally

launched it, we didn’t really raise any capital. I thought it was just going

to be another passive income thing like the apps that I’ve worked on before.

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Around 2015, we had a basic MVP up that allowed lawyers to sync their google

calendar and list their real-time availabilities. People can go there, click a slot

and get a free consultation with them.

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Around 2016, I applied to 500 start-ups. After getting rejected from them three

times they finally let us in and we built this marketplace-like model transferring

money. We knew we wanted to build out a marketplace that allowed companies

to hire lawyers. We didn’t build out a whole lot of technology at that point. We

were venmoing lawyers for work that they completed because clients would

pay us or hack together some PayPal links.

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It wasn’t that sophisticated, but we solved the core problem of connecting people

who need legal work done to people who were available to provide it and then

figured out all the other stuff afterward around pricing and match-making algorithms.

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When we’d gotten to 500 start-ups, we were predominantly focused on serving S&Bs

at the time— small businesses, start-ups. We pitched, raised our seed rounds shortly

afterward, and got to a place where we thought we had a good business.

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We realized shortly that we didn’t because our retention sucked. If you are an early-stage

startup one of the last things you want to spend lots of money on is a bunch of lawyers.

You’re trying to hire engineers, you're trying to find product-market fit, so it’s last on the

priority list. It didn’t make a lot of sense for us to continue growing the top-line revenue

for this market segment that essentially had a leaky bucket issue.

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Jon: It wasn’t a big hair on fire for the customer that they were climbing over

themselves to be a customer.

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Raad: We got a lot of them. We did a lot of SEO work, we did ad words but we

failed to raise a Series A because another big competitor came out. We had to

take a hard look at our business model and we came to the conclusion that we

can’t continue on this path and keep growing top-line revenue. We had to get

profitable and that led us to another path of going through our customer segment.

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Finding the ones that actually use this every day and were profitable ultimately led

to this gigantic pivot to a different market segment, still within the legal space but

more focused around actual legal departments that had a daily need for legal

services than just quarterly or yearly.

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It felt like the worst thing at the time but it was the best thing we did. We had to

say no to three hundred plus customers, start from scratch with five core customers

and rebuild the product.

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