With plans to grow to 150 people over the next six months and an announcement that it’s on track to raise $20 million ARR by the end of the year, Wave has become one of Toronto’s notable growth stories.
Wave co-founder and CEO Kirk Simpson spoke at FinTechTO to share the top lessons he’s learned over the past six years leading an accounting and invoicing company.
Wave’s business model includes giving away the core software for free, and Simpson admitted that this has led to “a lot of headaches” since the company’s inception from funders who, in Simpson’s words, think they’re insane to this day.
But Simpson says that it’s important for entrepreneurs who have a real desire to change their markets to stick to their guns. “The decision we made going free has been the best decision we’ve made; it’s certainly cut against the grain and created challenges. But I think the innovation we can bring to the space and customer-centric approach we take has played itself out,” he said.
He acknowledged, though, that going free is a good marketing tactic but not a long-term product strategy. While SaaS businesses are often looking at metrics like churn and conversion to paid, companies with free services aren’t watching those metrics as closely.
“For too long we believed that going free would overcome product deficiencies…it really came to a head when I thought to myself ‘I’m the co-founder of a company that we’re not 100 percent proud of the product.’ That is a shitty place to be,” said Simpson.
He was candid about the fact that at many points in the company’s business, they were in trouble. “Just get the opportunity, whether it’s days, weeks, months, to find that thing that changes the trajectory of your business. That happens in those days, weeks, or months, if you can find a way to stay alive,”
Watch the whole talk below: