Happy 2025. When I started Failing Forward last year, I spoke about two core motivations for the project.
The first is to pay forward my failure to others. Having started and shut down a company, I am sharing learnings to help other founders avoid our fate. Most of my posts have done this by covering specific topics, such as the need to build a must have product or die.
But something unanticipated has happened on the way: the process of writing these posts, of putting down lessons and explaining them to others, has actually changed and clarified my own learnings. Through the process I am developing a much better understanding of what happened, what I might do differently, and how I feel today in retrospect. It is therapeutic, cathartic and instructive. Thus I am more truly living my second intention, to move forward from failure, than expected.
And in moving forward, I have had this nagging urge. This itch that I cannot let go, and need to scratch. So I am actioning it today by putting out our full story in the most raw, unvarnished and unfiltered way that I can. I want to expose the Workstream journey in all its glory and horror so that others can draw their own conclusions without my post hoc voice inserted.
So today I am publishing in multiple formats our contemporaneous investor updates sent when building the company. This post is intended as a place for the reader to explore, determine for themselves what we did right, where we were wrong, and when the gods of luck blessed or damned us.
To get started, read on to the below section, Don’t Panic: How to Navigate this Bear. And from there choose your own adventure.
With love, Nick.
Don’t Panic: How to Navigate this Bear
This post includes three core parts:
#1 - The full text of my quarterly investor updates, sent from January 2020 to May 2024.
Substack estimates it will take you 84 minutes to get through all 20,000 words. So read in full if you are so inclined, but instead I recommend you start with #2 (a podcast) or #3 (a written timeline) to get a high level sense of the journey. From there, circle back to read specific investor updates in depth via the table of contents included below.
In the table of contents, you can navigate to each investor update, included in full along with descriptive titles (written more recently) such as: False Signals & Hitting $100K in ARR (August 2023). Further, I have broken the entire text into four distinct chapters into which all the investor updates are now grouped.
The first chapter, Founding and Alpha for Analytics Collaboration, covers our pre-seed funding, and our march towards our alpha release amidst the pandemic in 2020. The second chapter, The First Pivot, charts our evolution into focusing on data team workflows, starting in late 2020; it ends with the closing of our Seed about 15 months later.
The third chapter covers our push to Monetize our Data Knowledge Management product against the backdrop of the tech downturn and personal challenges for me at home; it concludes with us hitting $100K in ARR and feeling false hope. The final chapter, the Ride of the Rohirrim, chronicles the end: the immovable wall we ran into with sales, and our attempt to save it all with one final pivot that seemingly worked before we ran out of time and capital.
#2 - A 15 minute AI generated podcast created by Notebook LM
I asked Google’s Notebook LM to create a podcast based on the raw updates and our financing materials. Press play at the top of this post to give it a quick listen.
I find this a fun and engaging way to consume the content. I am myself largely impressed by the tech, as the “hosts” generally gets things right — other than some examples, such as why our final pivot did not work. (For that, I would rely on my final two investor updates: Leaving it All on the Field and Shutdown).
#3 - An AI Generated Timeline of Events
Notebook LM also created a timeline of critical events which I am sharing immediately below. If you aren’t a podcast person, just read this overview to start. Like the show, it will help you determine which posts you might want to read in more detail.
Please note that with the intent of keeping this pure of my retrospective voice, I did not edit the AI’s content. So for any inconsistencies please trust what I wrote in my updates. But with that caveat, I hope that you find this all helpful!
Don’t hesitate to reach out to me with questions, or if you want access to the Notebook LM to directly query it (Google won’t let me make it public).
AI Generated Timeline of Events
Late 2019
Nick Freund pitches Workstream to investors, seeking $1.5M in pre-seed funding. The pitch deck outlines a freemium pricing model with Individual, Team, and Enterprise tiers, and a go-to-market strategy focused on collaboration, discovery-driven upgrades, and strategic partnerships. Key milestones include initial development in Q4 2019, beta launch in 1H 2020, and general availability and company launch in 2H 2020.
2020
January: Workstream secures over $1.6M in pre-seed funding, exceeding the initial target. Nick Freund announces the funding and outlines plans for regular investor updates. The company focuses on refining the product experience and developing a clickable prototype.
March: Workstream expands its team to six, including a Product Designer, Front End Architect, Senior Software Engineer, and a contract engineer. The company conducts prototype reviews with potential customers, receiving positive feedback and validation for the product's potential. Development continues towards a private beta launch planned for mid-year.
May: The COVID-19 pandemic impacts Workstream's customer engagement efforts. However, the company recognizes the increased relevance of its solution in the new remote work environment. Workstream announces the upcoming launch of its beta program, generating significant interest and positive feedback from potential customers.
July: Workstream begins alpha testing with internal team members and close design customers. Initial feedback is positive. The company focuses on validating the minimal viability of its initial release and identifying necessary features and tweaks. Plans for a private beta phase are solidified, with a focus on establishing initial use cases and a feature roadmap.
October: Workstream launches its private beta with a select group of design customers, including best-in-breed analyst teams at companies with 300+ employees. Feedback is overwhelmingly positive, with users praising the product's design, functionality, and potential. The company gathers valuable insights into customer needs and use cases, informing future product development.
2021
April: Workstream refines its product vision, focusing on empowering analytics teams to support their assets as internal products and engage stakeholders as internal customers. The company introduces the concept of a "Knowledge Repository" to help data teams manage and communicate the context of their analytical assets.
July: Workstream releases v1 of its remixed product vision, including a web application (Knowledge Repository) and a browser extension (Workstream Concierge). Beta customer base doubles. The company prioritizes accelerating time to value for data teams, delivering features for core use cases, expanding the private beta, and preparing for public launch.
October: Workstream files a provisional patent application for its technology that registers assets, dynamically embeds them, and renders content within data visualization tools. The company focuses on integrations with data stack providers to enhance value and automate communication about data quality. Plans for a Seed round are underway.
2022
April: Workstream raises a $4M+ Seed round led by prominent VCs and angel investors. The company experiences increased adoption of its private beta and prepares for a public launch. Workstream releases new features and integrations, including dbt Cloud, JIRA Cloud, support for Thoughtspot and Salesforce assets.
August: Workstream launches its public beta and announces its Seed financing. The company hires business talent, including roles in sales, marketing, and customer enablement. Workstream focuses on establishing a go-to-market strategy, generating awareness, and growing its customer base.
January 2023: Workstream secures its first paying clients, crossing the "pennies barrier" and becoming a revenue-generating company. The company focuses on converting additional accounts, building sales pipeline, and accelerating its sales cycle.
2023
February: Workstream wraps FY 2022 with $50K in ARR.
May: Workstream raises total ARR to $81K, landing its largest customer to date (Feeld). The company redefines its ideal customer profile, honing its messaging around data knowledge, and highlighting its benefits.
August: Workstream surpasses $100K ARR and sees promising results from its data knowledge category creation efforts. The company's social media impressions grow significantly due to its investment in video content and data knowledge initiatives.
November: Workstream experiences flat sales growth due to the challenging macroeconomic environment and lack of urgency among prospects for adopting data knowledge solutions. The company pivots its go-to-market strategy by introducing a new data incident management module and lowering its pricing.
February 2024: Workstream concludes FY 2024 with $69K ARR. The company experiences churn and recognizes the need for a new direction. Workstream launches a free Core SKU for data incident management with the goal of attracting new customers through a product-led motion.
2024
May: Workstream shuts down operations, unable to secure additional funding or a suitable acquisition offer. The company cites challenges in the macroeconomic environment, the perceived "nice-to-have" nature of its data knowledge solution, and the lack of conviction around its new data incident management offer despite promising early traction.
FULL INVESTOR UPDATES
Chapter 1: Founding and Alpha for Analytics Collaboration
Chapter 3: Monetizing Data Knowledge Management
Chapter 4: The Ride of the Rohirrim: PagerDuty for Data
Founding and Alpha for Analytics Collaboration
Pre-Seed Wrap (Jan 2020)
To Our Workstream Investors,
Happy New Year -- we are excited to announce the details of our initial financing round!
We are excited by the amazing support we have received for what we are building, with our total capital committed north of $1.6M, against our initial target of $1.5M. In the past week, you should have received an email from Carta with your SAFE certificate that you need to accept -- if you for some reason have not seen it please let me know.
We have a great group of investors in the round, from experienced operators and entrepreneurs, to venture capitalists doing private investments to angel investors. Please bear with me while I get a cap table with the details published, as I am wrapping up a few final investors in the next couple of days.
Going forward, I am planning to send out investor updates on a regular basis -- but in the meantime, I wanted to communicate a few highlights on where the business currently stands, and what we are focused on today.
Team
In early November, Chris Ibarra joined as our Co-Founder and CTO. Chris and I were introduced through a close mutual friend and former colleague (the VP of Engineering at BetterCloud, who I worked with closely during my 6 years there, and who Chris worked with previously). Chris and I spent a lot of time getting to know each other and working together on nights and weekends before Chris made the formal decision to join Workstream.
Two weeks ago we had a very talented Front-End Architect join the team part time. In addition, since last November, we have also had an excellent User Experience (UX) Designer who has been helping out part time to define and design our initial product experience. We are getting amazing throughput from these resources.
We are of course working to turn these into full-time roles, and we are actively hiring for a number of other roles to fill out our early team (see the bottom of this email for links to job descriptions -- any referrals are most welcome).
Product
We are heads down in the early stages of development. We are focused on both research and development of early integrations (i.e, Microsoft Excel and Google Sheets), as well as systems design. We will begin laying down production code within the next month.
In parallel, we have spent hours refining our initial product experience, and now have a working, clickable prototype of what we believe our product will look like at private beta. I am actively re-engaging with potential customers to get feedback on the prototype, and validate key product assumptions. (The conversations have been very positive and productive so far). From there, we will look towards locking product scope ahead of our major development push towards our private beta launch later this year.
Please don’t hesitate to reach out if you have any questions on the above or the business in general. Again, I would like to express my sincere thanks for your support, and I could not be more excited to have you along for our journey in the upcoming months and years.
Best,
Nick Freund
Founder and CEO
Open Roles
First recruits, MVP validation & development (March 2020)
Hi Everyone,
I hope that this email finds you well, it has been around six weeks since my last update. I am happy to report that we have made material progress across the business, from building our team, to customer engagement & product validation, to software development.
Our Team
Our initial team is fully staffed for our push towards private beta in the middle of this year. In total, the team includes six people, with five full time team members and one contract engineer giving us additional bandwidth.
From a roles perspective, in addition to startup CEO duties I am leading product. I am working closely with our very talented new Product Designer who has come onboard full-time.
In addition to serving as CTO and running the engineering team, Chris is our acting application architect and is building the back end of our system. In the past few weeks, we have brought onboard a Front End Architect, a Senior Software Engineer, and have one contract engineer working on our back-end.
I decided last fall to build a remote first team, rather than insist everyone work together in an office, and we are investing in building a successful remote culture. The strategy has served as a major catalyst to bringing onboard extremely talented people at reasonable salaries, and has allowed us to operate without disruption during the evolving Coronavirus crisis. I am more convinced than ever that our remote strategy will continue to be a major asset to our business in the coming months and years.
Product
We continue to make substantial progress on early product validation and development.
We conducted our first round of prototype reviews in late January and early February, which followed the substantial customer discovery work that I completed last fall. We spoke with about 20 potential customers, and overall we received strong validation that we are solving an acute problem for teams and that our approach is compelling. We are now in the process of turning around a new version of the private beta concept based on the feedback we received. If you would like a demo, please let me know.
From a development perspective, we have made substantial progress with regards to both R&D as well as laying down production code. We completed several technical proofs of concept in January and February, which have validated our technical approach. We have proven that we can natively integrate with our early integration partners (Google Sheets, Microsoft Excel), and dynamically imbed and interact with those products within the Workstream application.
We have been in beta development for about a month. Full team development kicked off on March 2nd. Notable milestones include finalizing our technology stack, standing up our API and web application, and building user authentication and login.
Launching Workstream
More broadly, we continue to push forward with launching the company and preparing for our private beta. Here are some highlights:
We officially launched our new website and brand identity at Workstream.io. Feel free to head over there and check things out. Keep your eyes open for an official company announcement in the next few weeks.
You will notice that we continue to refine messaging. Customers continue to validate that what we are building really goes beyond mere collaboration and that Workstream is unifying the lifecycle of analytical projects, just as the Atlassian suite and Github transformed the software development lifecycle. While thousands of engineers can seamlessly contribute to a single code base, when more than two people attempt to collaborate on a model or dashboard, the entire project becomes a complete mess. This is a really big problem that we intend to solve.
We are early in development, but we still anticipate launching into a private beta in the middle of the year. We have a dozen or so customers interested, and I’ll be working to lock in commitments following this new round of user testing.
Please don’t hesitate to reach out if you have any questions on the above, or on the business in general. Thanks again for your support -- I look forward to continuing to keep you updated on our progress.
Best,
Nick Freund
Founder and CEO
Impact of COVID shutdown (May 2020)
Hi Everyone,
I hope this finds you and your families safe. I have gotten some inbound questions from our investor group about the COVID-19 crisis’ impact on Workstream, so I wanted to kick off this month’s update with what I have seen so far and anticipate in the months ahead.
Impact of COVID
Our decision to build a remote-first team has generally allowed us to avoid major disruptions to day to day operations. However, we have of course been navigating personal impacts to our team members, be it either the stress of being shut inside, safely getting supplies, or juggling a lack of childcare. So far, the team is generally navigating the situation well and we haven’t seen material impact to our key milestones for 2020.
As I continue to engage with customers, the conversations have made it clear that our solution may be more relevant than ever in this “new normal.” (See the Product Design and Customer Engagement section below for color). That said, the current environment has certainly made it more difficult to get customers’ attention – especially considering our current customer ask is for feedback on our prototype.
To the extent the crisis extends through the summer and into the fall, which I personally believe is where we are headed, it will likely cause challenges in customer engagement in our private beta. I’m optimistic that our freemium strategy will prove itself a valuable countermeasure, as a quick-to-install and initially free-to-use product is a welcome salve in a recessionary environment.
From a financial perspective, I am relieved to report that given the success of our January financing, we have runway to the fall of 2021 given our current team and staffing plans. While we did not apply for any SBA loans, under the recovery programs we can defer our 2020 social security taxes until December 2021, which is an incremental positive for our runway.
Product Development and Customer Engagement
We are ~10 weeks into full team development, and we continue to track towards our planned private beta in mid-2020. Including Chris, we have 2 developers building our API, 2 developers building our UI, and a Product Designer working to define our product experience.
Some notable technology updates in the last month include:
We have made significant headway with our Excel/OneDrive integration
API development is ahead of schedule, currently a bit behind on the UI
Completed implementation of our event infrastructure, and designed our notification system
Beginning QA on the web application
From a design perspective, in the last month we completed another version of our clickable prototype, and conducted another round of customer testing. Customers continue to indicate that we have a compelling approach, and make initial commitments to being beta testers. They are also providing constructive feedback on various UX changes that we are incorporating into our final design for private beta. By next month, I anticipate having a fully refined prototype of our entire private beta experience.
Moreover, amidst the crisis, the tone of customer conversations has changed. There is a nearly universal consensus that the current situation – in which every team has had to transition to remote work, while simultaneously needing to re-assess, reforecast and replan their business, makes our solution more timely than ever. I’m optimistic that we can respectfully leverage this dynamic to generate positive momentum for our product launch.
Launching Workstream
As you should have seen, we formally announced the company at the beginning of April. Our goals were to start generating awareness about the product and vision, and begin to tell the Workstream story in a way that will authentically connect with customers and the ecosystem.
The reaction far exceeded my expectations, with over 10,000 views of the announcement & blog post on LinkedIn, and lots of inbound interest and traffic to the Workstream site. Some notable reactions include:
“This is pretty intriguing. I always think that in finance it's super difficult to track model versions or have multiple hands in a model at the same time. We would love to test the beta. Let's catch up and discuss when you have some time.” -- Financial Services Director w/ $25B under management
“This product could solve some real, acute pain points that my team experiences...I look forward to participating in the beta when the time comes.” -- VP Finance, 100 person tech company
“Nice to connect and congrats on your launch. I work on analytical projects all day long and collaboration on teams is always a nightmare. I can think of countless times where version control on financial models, customer files, etc and getting feedback from multiple people via email have been a nightmare. When I saw your post, it immediately resonated. I would love to beta the product.” -- Financial Analyst
“The struggle is real and this is an exciting solution. Congrats!” -- VP of Operations, Media
While our initial proof will be, of course, adoption at launch, I believe that we have more than ample validation to continue aggressively moving forward.
If you have any questions, please do not hesitate to contact me.
Best,
Nick
We are in alpha! (July 2020)
Hi Everyone,
As always, I hope that this email finds you and your families safe in this crazy time. Without further ado, here are some details on where we are at Workstream:
Alpha and Beta
I could not be more excited to report that we are officially in alpha, and that we have begun our initial customer tests!
Over the past few months, Chris has done an incredible job of keeping our team focused and productive. I find this particularly remarkable given we only began product development on March 1st, and the COVID crisis consumed the US a few weeks later. Since then, we have onboarded new team members, built the entire front and back-end of the application, gotten our Chrome and Firefox extensions listed in the respective stores, and launched our alpha product.
We have officially begun alpha tests, which started with Chris and I collaborating on the company financial forecast a few weeks ago, and now includes some of our close design customers that we have been working with during development. While it is very early, the initial feedback has been generally positive and constructive.
Product-wise, our initial “customer hook” includes the ability for customers to kick off and scope out their projects, and consolidate their modeling, feedback and iterations into a single experience. With regards to integrations, we are launching with support for Excel/OneDrive, which is the foundation off which we will build future integrations — from Google Sheets, to Looker and beyond. During this phase, our goals are to understand whether our initial release is actually minimally viable, what features and tweaks are needed to get fully there, and to work out enough of the bugs and kinks that we feel confident in proceeding further.
From alpha, we will look to fast follow with our private beta phase. Over time we will open up from a few to the few dozen design customers already lined up. Beyond initial usage and feedback, our goals will be to establish the 1-2 initial use cases Workstream solves, and solidify the roadmap of features and future integrations that will allow us to solve these use cases from end to end. More details on this soon.
From a customer adoption perspective, we anticipate better understanding how Workstream lands within a finance organization and organically expands to support stakeholders and leadership across a business.
The space and the opportunity
While customers — having felt the acute pain points around running analytical projects — have understood and been enthusiastic about our vision since the beginning, it feels like conversations have been changing in the past few months.
As I have continued early business development, and content marketing, it just feels as if there is broader consensus that the space we are in has huge potential and is in many ways a blue ocean. No vendor has yet supercharged the workflow of analysts, or how their teams manage their projects and influence decisions made across the business.
Accordingly, others have started to see the opportunity, and in the past few months I have seen a handful of startups cropping up in our space. I feel this burgeoning interest in the space is great validation that we are onto something big, but I truly believe that our product, vision and take on how to solve customer problems is unique. That said, to seize the opportunity and become the leaders in our space, we need to continue moving forward with deliberate speed towards our beta. We must continue to invest in telling our story in an authentic way in order to make ourselves as broadly relevant to customers as possible when open up into public beta.
If you want to read more about how we are beginning to position ourselves, you can check out my latest blog post (Why the Best Analysts are Developers). It speaks to what I believe is an opportunity to pioneer a new, innovative way by which teams manage analytical projects. In the upcoming months, we will spend more time investigating the past, present and future of analytical work, and how Workstream is at the forefront of a new solution category.
As always, please do not hesitate to contact me if you have any questions, or are interested in seeing the product in action.
Best,
Nick
Private beta & initial learnings (October 2020)
Hi Everyone,
I hope that you are having a good start to fall, and are finding some semblance of normalcy amidst a turbulent year. I am excited to provide an update on where we are with our private beta, and some of our key learnings to date.
“Phase 1”
We are working with a handful of customers and are learning a lot from their feedback. We are releasing product fixes, optimizations and new features every two weeks.
These customers are best in breed analyst teams, working at companies of 300+ people. By best-in-breed, I refer to both their influence in the organization and the tools they use. These teams are the decision making nerve centers of companies, and leverage everything from Excel & Google Sheets to the modern data stack. While their titles may include finance, strategy or data, what unifies them is how they work, the toolset they use, and how they support and influence the business.
When investing in Workstream this past January, a few successful founders of other companies told me that our ability to respond and make changes is what will determine our success. I have a firmer appreciation for this dynamic as we seek product-market fit, and pioneer what I believe is a completely new product category. We are not building a better mousetrap, and there is no Gartner magic quadrant for what we do.
At a recent Workstream team meeting, I shared how I believe this dynamic translates into our evolving relationship with customers, how they leverage our product and get value from Workstream:
While the framework risks being overly simplistic, to break it down:
Phase 1: Customers begin testing the product and onboard their core team. They start providing us feedback on what is and is not working.
Phase 2: We have sufficiently actioned the feedback that users begin organically adopting Workstream for various projects, and experiencing day to day behavior change. Our user base expands beyond the original, core team.
Phase 3: Our customers begin to have an emotional connection to Workstream, and cannot imagine life without us. They champion the product internally and externally, and user adoption snowballs.
With our first few design customers, we are still in phase 1. Our goal is to get this cohort into phase 2 by early next year.
Highlights
As users see and get their hands on the live, working product, their reactions continue to validate that we are pursuing a big opportunity and are addressing acute pain points. Here are some of the exciting reactions:
“It feels very refined for a beta product. The design is great”
“The product is different, but it reminds me of Notion”
“This is Ironclad for Finance”
“The versioning and conversations remind me of Github”
“You are onto something really big here, right now we get feedback all over the place”
“Eventually introducing this into corporate planning would be invaluable”
“This is far more interesting than I originally thought”
“Your decisions to meet people in the communication channels they are used to [currently email] is really smart”
“Being able to scope and manage a project within the same area [as collaborating on it] is super powerful”
“Even just wrapping a conversation around Excel is huge”
“This could solve our issues in a way that even Google Sheets comments do not”
Feedback & Changes
Here are some of the things we’ve learned and the changes we are making:
Optimizing onboarding
While we were building, we spent a ton of time trying to think through and optimize how customers would install and start getting value out of Workstream.
Our goal is that customers can install, create their first project, and get to that initial WOW moment within 5 minutes. This is in contrast to most analytical tools that take months or years of implementation and user training. Having taken users through installation more than a dozen times, I can confirm that some customers have seamlessly onboarded, and get to that wow moment quickly.
However, given the nature of our product — a workflow solution that integrates with existing analytical tools, starting with Excel — our v1 came with some limitations. Specifically, users have to authenticate using their Microsoft credentials and connect us to their OneDrive account. This is how we currently store and render their files.
These limitations have resulted in customers either a) not being able to complete onboarding, or b) having to work internally to get proper Microsoft licensing so that they can start testing. These issues create unwelcome friction, and prevent us from building a true bottom’s up, flywheel business. Accordingly, we are working on a few immediate changes.
In the last few weeks we have launched support for Google authentication: now any user can easily create a Workstream account.
More excitingly, I’m happy to announce that we have been accepted into the Microsoft Cloud Storage Program. The APIs available in the program will allow customers to use Workstream without any other platform dependencies, making storage integrations (ie OneDrive, Dropbox or Google Drive) optional, value added functionality. The APIs give us more control over the end to end customer experience, and unlock some of the more advanced features on our roadmap.
While integrating with these APIs is a technical lift and comes with new infrastructure to build, this change will be key to reducing friction and transitioning from phase 2 to phase 3 next year.
Behavior change
Throughout this initial stage of the beta, one of the issues we have heard is that we are asking users to go through significant behavior change. This takes time and comes with unique challenges.
While the current workflow of complex analytical projects — emailing versions of the model back and forth, or slacking snapshots of the dashboard — is recognized as clearly broken, customers have to choose to change their behavior. And then they need to invest in and champion the Workstream way. While this poses a short-term challenge, it also presents an opportunity long term to create true customer love and stickiness.
We have certainly seen this dynamic at play in the early days, with customers installing, doing some initial testing, but not yet introducing us into their active daily workflow.
While there are lots of lessons here, one of the big customer asks is for a more flexible, lower friction way to get analytical artifacts (ie. Looker dashboards, Tableau reports, etc) into our application. This will shorten our time to WOW, and lower the bar to the behavior change we are asking of customers.
Thus, our other main focus in Q4 is a dashboard capture feature. This will allow analysts to quickly grab dashboards, and pipe them into Workstream so they can request feedback, and manage iterations.
The bottom line is that we are excited about our results so far, and the customer feedback that is helping us both improve the product and validate the opportunity ahead.
As always, please do not hesitate to contact me if you have any questions, or want to check out the product.
Best,
Nick
The first pivot
ICP Pivot to Data (Jan 2021)
Hi Everyone,
I hope that this update finds you well. I have spent time in the past few weeks looking back on 2020, and it is pretty amazing how much we have accomplished.
In a single year, we went from a high level insight that the analyst workflow was broken, and the general outlines of a product, to a real company with funding and 5+ passionate team members.
We launched into alpha late summer, and since the fall have been working closely with engaged customers to rapidly iterate and evolve our beta. We have onboarded customers who acutely feel the pain we are solving and believe in our vision. We have alignment on our roadmap, and early validation from critical technology partners.
We are moving forward with relentless focus on delighting our beta customers, and transforming them to daily users that live in, love and could not imagine replacing Workstream.
Customer Profile
We continue to sharpen the definition of our ideal customer, which we have always defined as the "modern analyst." Our ideal customers are analytics and data teams at companies of 300-5,000 employees. These customers leverage best-in-breed analytical tools to deliver insights to the business, and increasingly are transitioning from more traditional tools like spreadsheets to the modern data and analytics stack.
This modern analyst needs to be technically proficient (i.e, they have deep expertise in SQL, can dabble in Python, can build visualizations in Looker), be a great analyst, and have a high degree of business competency. While somewhat technical, this article from Andreesen is an amazing overview of this emerging analytics stack; I believe we live in a new box to the right of the "output" column here representing workflow between analyst teams and business stakeholders.
We believe that how the modern analyst leverages the output of these tools to empower the business is still broken. The quote below from one of our customers speaks directly to this pain, much of which the Workstream product can already solve today:
"Most of the financial "modeling" for this project is in Mode, and right now I'm taking screenshots of each scenario, and then pasting into a Google Slide. Comments from stakeholders are a mishmash of Slack threads and comments on Google slides. It is cumbersome to keep track of conversations, and know when a critique should result in a new analyst work "ticket". The final product lives in Google Slides, and is exported into PDF to be shared with external entities."
Product
With a more refined definition of our ideal customer profile has come a more consistent and aligned signal on where we should be headed with the product. We are moving aggressively to action this feedback, and launch new features every two weeks.
Here are some highlights from the past few months (links included to product updates with visuals and more details):
Dashboard capture. Analysts can now build dashboards in their visualization tools, associate them to Workstream, and request feedback from stakeholders.
Dashboard annotations: Users can annotate their dashboard with drawings and graphics.
Video support: users can embed a Loom video in a Workstream discussion to more quickly explain a topic.
Storage system & updated notifications. We released our new storage system to improve performance. We also added additional notification options based on customer feedback.
Looking forward, here are some of the big features that we believe will take user adoption to the next level, and motivate new companies to come onboard as Workstream customers. The key themes are both a) integrating Workstream natively with business intelligence/visualization tools, and b) providing richer experiences to empower stakeholders.
Dashboard embeds: This is the next evolution of our dashboard capture feature, allowing us to support fully dynamic dashboards alongside a history of static snapshots. We intend to support all visualization tools that allow for embedding with this release.
Browser extension: this will bring our core functionality (conversations around data and analytics) directly alongside the visualization tools our customers are using (i.e, Tableau, Looker, Mode, etc).
Workstream concierge: A portal where stakeholders can access curated information (i.e, key reports with context) as well as make request of the analytics team.
As always, don't hesitate to reach out if you have any questions.
Cheers,
Nick
The remixed vision, and why we are 10X better (April 2021)
Hi Everyone,
I hope that everyone is having a good start to their spring. I’m excited to share some of the substantial progress we have made over this past quarter and speak more about the opportunity ahead for the business.
To start, I would like to express my gratitude to our design customers — most specifically Shaun Chaudhary, the Director of Data & Analytics at BetterCloud, and his team.
Beta engagement has been great the past few months. Here is a great quote from Mike Stone, the Head of Community at BetterCloud, just 5 minutes after Shaun onboarded him. (Use case: get feedback on a set of dashboards Shaun’s team is building for Mike): “I can see how valuable this is. There was no way to do this back and forth well before.” And then of course they pointed out 5 improvements that we are now actioning.
This input, along with that from other design customers, allows us to now — more than ever before — clearly express the product vision and how Workstream will solve acute customer pain points. Most importantly, we have alignment and conviction on what we need to remix in the product to truly unlock organic adoption for our beta users and acquire new customers.
Q1 Key Highlights
Since this remixed vision is this update’s focus, I am intentionally keeping this section short. But here are some additional wins of note:
Product
We now support embedded dashboards in Workstream, including support for Tableau, Looker, Mode and Google Data Studio.
We launched our Slack integration. Users can now create Workstream projects from Slack and leverage Slack for notifications.
Team:
We hired an additional front-end engineer and brought onboard one of Chris’ former colleagues from Roadie as QA Architect.
With these new hires, we round out our early team which now includes myself, Chris, 3 engineers, our QA lead and our product designer.
The road ahead, and the vision remixed
To empower their business, analytics teams deliver stakeholders critical operating assets, such as dashboards. Workstream empowers analytics teams to support these assets as internal products and engage key stakeholders as internal customers.
Analytical assets are internal products
One of our design customers has over 1,000 dashboards in their Looker environment. These were created over years and many are no longer relevant or actively maintained.
It is nearly impossible to communicate to stakeholders which assets are still relevant. They struggle to train business users on how to use the assets (i.e., the products) they have built and encounter problems in communicating important context about them (e.g., how to interpret what they are seeing, use various filters, known issues with the underlying data). Inversely, it is painstaking or impossible to understand what stakeholders find valuable, discover what people are using, and capture their feedback.
Workstream’s Knowledge Repository empowers analytics teams to:
Quickly associate dashboards to our product where users can view them dynamically
Communicate which assets are supported by the analytics team and curate written (or video) explanations of important context
Capture and view stakeholder usage and trends
Solicit and track stakeholder feedback
Stakeholders are internal customers
Analytics teams struggle with an endless stream of inbound inquiries. These might be questions about how to use a dashboard. Or, they could be requests for feature changes on an existing asset, or a completely new dashboard or set of dashboards that need to be created.
Even the best teams struggle with maintaining this workflow, because there is no system that has been purpose built to manage it. Most inquiries start inbound via Slack or email, and the best solution for providing visibility is a shared slack channel for each department (i.e., data-marketing, data-sales, etc). Some teams leverage JIRA Service Desk, or even tools like typeform or google forms to collect stakeholder requests. But the experience is painful, requiring stakeholders to fill out annoying forms. Users then must hop between systems to navigate the request and what was delivered to fulfill it.
Workstream’s Concierge empowers customers to:
Ask questions and create requests from where they originate: the dashboard itself
Iterate on requests directly on top of a dashboard or report
View, manage and fulfill your team’s queue of inquiries faster
Pin frequently asked questions and open items to assets, clarifying the existing known issues for stakeholders
Why Workstream is different (and 10x better!)
Unlike existing solutions (for example: a corporate intranet with documentation separate from their business intelligence tool, or handling requests via Slack or a more traditional service desk and using screenshot links for feedback), Workstream brings these disparate elements into a single, integrated experience built on top of a company’s live data assets. We meet users where they are and thereby supercharge their workflow.
In this way, our product is not a separate destination. “It is embedded in the work itself,” and is uniquely positioned to supercharge the workflow of analytics. Workstream gives analysts a canvas to communicate knowledge about the products they deliver, capture unique insights about how those products are leveraged by internal customers, and increase the velocity by which teams deliver on requests and answer questions.
I am excited to keep you posted on our progress towards this remixed vision soon. As always, feel free to reach out to me with any questions.
Best,
Nick
Remixed use cases and pain points (July 2021)
Hi Everyone,
In our last update, I shared the details of our remixed product vision and how it would empower analytics teams to support the assets they create like products, and to treat their stakeholders like customers.
I am excited to announce that over the past few months, we have delivered v1 of our remixed product vision, across both our web application (aka, our Knowledge Repository) and our browser extension (aka, the Workstream Concierge).
📹 A Loom is worth a thousand words. To check out the product, feel free to view here. (Watch at 1.5X speed to save yourself some time).
Since we launched the remixed product a month ago, we have doubled our beta customers. Within existing beta sites, more power users (i.e, data analysts & analytics engineers) are onboarding onto our system, and we are seeing them actively add and curate assets within their workspaces!
⭐⭐ Key ask -- Intros to Data & Analytics teams ⭐⭐
If you have a friend or colleague that is into new analytics tooling, and wants to better manage their data products & support their stakeholders, please reply to this email!
As a reminder, our ideal customer profile is data & analytics teams leveraging the modern data stack at forward thinking companies of 100+ people. We currently support customers using Tableau, Looker, Mode and Google Data Studio -- but can easily add support for new providers within a week.
💥💥 Core use cases & corresponding pain points 💥💥
Based on engagement with beta customers, we are increasingly focused on a few interrelated use cases. These all revolve around the issues experienced in communicating context around your data, and having to manually answer questions across fragmented systems. This leads teams to waste time and make decisions based on misinterpreted or outdated information.
Use cases include:
Managing the lifecycle of analytics/data products: when your Looker instance has 1,000 dashboards, how do you understand what your internal customers are using and find valuable? How do you communicate to customers what the data team actively supports, and programmatically deprecate what isn’t in use?
Enabling customer training & communicating context: When you have delivered a product, how do you curate and communicate to your internal customers important context? How do you train new customers how to use the products that you have already built?
Getting feedback when building new products: When building something new, how do you streamline the broken workflow of receiving feedback from stakeholders and colleagues?
🚀🚀 The path forward 🚀🚀
We continue to learn firsthand what the smartest founders and investors have been telling us since the beginning. As Mixpanel and MightyApp Founder Suhail Doshi recently wrote, getting the product right takes “a lot of time, iteration, and grit.”
We are moving forward with deliberate speed, and building upon our solid product foundation to deliver the end-to-tend experience that customers indicate is extremely valuable and which they are willing to pay for. Conversations are transitioning from “this is nice to have” to “what you are building is a must have solution to acute problems we experience.” Many customers have built, as they put it, “janky hand rolled solutions” to these problems that “don’t work well.”
Accordingly, this is what we are focusing on in the upcoming months / the rest of the year.
Accelerating time to wow for our power users (data teams). Right now there is some effort required for teams to set-up and curate their workspace; we want to make this increasingly programmatic and automated. Time to wow should be 5 minutes or less.
Delivering the features that unlock our core use cases & rollout to stakeholders across the business. We will prove that after their wow moment, a single analyst will roll out our solution first to their colleagues on the data team and all of their key stakeholders across the business.
Expanding the private beta & preparing to open up the product.
We are establishing a playbook to make customer wow moments and internal rollouts repeatable and predictable for anyone who onboards onto Workstream. This is what will give us the confidence to make aggressive investments in customer acquisition (and monetization).
In preparation, I am building a pipeline of candidates for the business side of the organization. We are also working to revamp our corporate identity & website to align with our remixed vision and vector.
I hope that you are as excited as I am about the progress that we have made, and the opportunity ahead. I look forward to updating you again in a few months, and as always please don’t hesitate to reach out with any questions (or customer referrals 😄).
Best,
Nick
Managing 10K analytics assets + faster time to wow (Oct 21)
Hi Everyone,
In my last update, I wrote about launching the remixed product, and the core use cases it was unlocking. This time, I am focusing on how we have accelerated time to wow for our power users (data teams) and are enabling rollouts to their stakeholders.
⭐⭐ Key ask -- Intros to Data & Analytics teams ⭐⭐
As always, if you have a friend or colleague in data & analytics that wants to better manage their data products & support their stakeholders, please reply to this email!
Milestones of note
New website! We reworked our external brand and messaging to reflect the remixed product. People now just “get it” faster, and our inbound interest is increasingly from folks matching our ideal customer profile.
Provisional patent application filed: We filed a provisional patent application for the technology by which we register assets, dynamically embed them, and render Workstream content within the native UI of data visualization tools (i.e, Looker, Tableau, etc).
Customer usage: We are now seeing daily usage from beta sites! We still have more work to do, but this is obviously great to see.
New features: As always, we have been busy evolving our product these past few months. In addition to actioning customer feedback, notable features include enhanced navigation, global search, asset lifecycle management, and lifecycle automation. We also enabled support for Google Sheets and Looker explores as new asset types.
Managing 10,000 analytical assets & faster time to wow: Our product has always been integrated with the front-end of analytics tools. Thus we can facilitate data-stakeholder workflows on top of live data assets across our web app (aka, our Knowledge Repository) and the native UI of analytics tools (via the Workstream Concierge).
While that experience creates wow moments for customers, until recently they had to manually add assets to our system. This resulted in even our most engaged customers having only a few dozen assets in their workspace.
This quarter, we also delivered API integrations for Tableau, Looker and Mode. During onboarding, we now bulk import thousands of assets, and help teams get them organized, in a few minutes. And then each day we detect & sync anything new for curation and categorization.
Customers now get to wow moments in their first five minutes using Workstream, a complete sea change.
Key learnings
These past few months have brought some of our most significant learnings to date.
Workstream is a two sided network
Our strategy has always been to land with analysts and have them bring us to their stakeholders. We see this dynamic today, as teams use Workstream to certify assets and communicate important context to stakeholders. We have the early signs that this will soon yield mass rollouts to data stakeholders at our customers.
Excitingly, our product gets more powerful as more users within an organization adopt it (i.e, there are network effects). Specifically, stakeholder engagement is captured to provide data teams rich insights about how their products are being used, and inform automation that takes unused or stale assets to end of life.
For a customer to be successful, the incentives for data teams (i.e, suppliers) must be strong enough for them to bring our product to their stakeholders (i.e., consumers). And there must be enough immediate value for stakeholders to adopt and engage data teams using Workstream.
Expanding our integrations & automation
We are thinking more about how we can integrate more fully with data teams’ core tools, and automate their workflows.
In an update from earlier in the year, I wrote about this article from a16z and our place in the modern data stack. I believe we are pioneering a new category to the right of the output column in this diagram: cross functional analytics workflows.
While we’ve already integrated with providers in the data consumption layer, it is clear that integrations with providers deeper in the stack will supercharge value and incentives for all our personas. Our efforts here will expose to data consumers key context about (for example) data quality, and automate how data teams communicate underlying issues to their customers.
Wrapping 2021
Product
We are acting on input that we should “go deeper” by building a DBT integration. (If you want to learn more about them, read this). We are on track to have our integration complete by DBT’s second annual Coalesce conference in December, where we are a sponsor.
In parallel, we are working on an integration with JIRA to automate the process of creating, iterating on, and delivering stakeholder requests.
Existing customers have indicated these will catalyze stakeholder rollouts.
Customers and fundraising: We are focused on growing the beta group, and expanding usage and our footprint within existing sites. We are also getting ready to raise an institutional Seed round. More on our progress here soon.
Best,
Nick
Closing the Seed (Apr 2022)
Hi Everyone,
It is a bit overdue, but I am excited to provide this group of investors and supporters with our latest company update. While I am reminded nearly every day that building a company is not a straight line – see the below from friend and founder of Modern Treasury Dimitri Dadiomov — we continue to make progress with the product & business.
I’m excited to share that we closed a $4M+ Seed round, continue to see more product adoption of our private beta, and are headed towards our public beta launch!
⭐⭐ Ask: Intros to Data & Analytics teams ⭐⭐ As always, if you have a friend or colleague working in data & analytics that wants to better manage their data products & support their stakeholders, please reply to this email!
⭐⭐ Ask: Employee Referrals ⭐⭐ We will kindly take referrals for any of the below roles!
Milestones of note:
We closed a $4M Seed round led by well known VCs, with participation from numerous angels – including existing investors, as well as founders/leaders from well known technology companies. I will share more details in a formal announcement in the upcoming months.
We are seeing daily active usage with private beta customers, with compelling DAU/MAU. We are also seeing rollouts happening to data team stakeholders. Note: we will soon begin to share measurable metrics in these areas.
New features
We have been working hard to act on user feedback, improve our product experience and let customers get more out of our existing feature set. Enhancements include asset tagging, asset filtering, asset sorting, a new asset grid view and conversation enhancements.
We now support in-application training guides: this will be key as we open up the product for anyone to install.
Our product now exposes upstream data quality issues via our asset status pages
New integrations / supported asset types
dbt Cloud: we now have an integration with dbt Labs’ flagship product. This powers our status pages and opens up compelling future functionality.
JIRA Cloud: while everyone hates JIRA, it is still the standard for agile project management. This integration auto-magically creates JIRA tickets whenever teams make requests in Workstream.
Support for Thoughtspot Liveboards and Answers
Support for Salesforce assets: This dramatically opens up the types of data assets that we can support, including those found in operational systems used across businesses.
Key learnings: Here is a selection of some of the key things we have learned from the past months.
User adoption patterns: as mentioned last time, our product is a two sided network, with data teams (our evangelists) on one side and stakeholders (product managers, customer success managers, leaders, etc) on the other. So far we have largely landed with the former, but we have seen a couple exceptions. If we can prove out how to successfully land across both personas, it could be a huge unlock with regards to our go-to-market. There is work to be done here as we get into public beta.
Product messaging: the messaging framework of our product helping “data teams support their assets like products, and their stakeholders like customers” has largely resonated with customers in the past few months. It has also helped clarify product messaging around key feature sets, such as:
Kill your service desk and collaborate with stakeholders directly in context with your live data assets
Train your internal customers with embedded documentation, training videos and FAQs
Expose status pages to instill trust in your products
Understand data environment trends, including how your data products are being used, and add value to the organization
Single player use cases: we continue to get consistent feedback that the “understanding environment trends” aspect of our product is the most relevant to daily, single player workflows for data teams. This is especially true for teams that have invested in enabling self-service analytics. We are going to double down on this in the coming weeks by:
Improving the experience of that feature set & exposing additional insights to data teams.
Offering a “stakeholder version” of this same feature.
Competitive landscape: Even among early stage companies, I still have not seen a truly competitive solution to us.
Most tangentially relevant are data discovery or cataloging tools.These aren’t directly competitive, especially as I consider our vision and roadmap.
This means that we are still largely pioneering our own category, which of course is both a good and a bad thing (especially in a space with so many categories of tools).
Next steps: here are some of the things we are focused on in the upcoming weeks and months.
Launching into public beta this summer
Getting the word out: we will start to more publicly evangelizing our approach and the new category that we believe we are building
Investing in touchless customer enablement & continuing to shrink time to wow/value for newly onboarding customers
As always, we appreciate your support for the company. Again don’t hesitate to reach out if you have any questions about progress to date or where we are headed next.
Best,
Nick
Monetizing Data Knowledge Management
Public Beta Launch + Building the Biz Team (August 2022)
Hey Everyone,
I am excited to provide you with an update on our progress since we opened up our public beta earlier this summer and announced our Seed financing. As always, I will discuss the road ahead and what we will focus on in the next few months.
⭐ ⭐ Key ask: If you know anyone looking to consolidate disparate data assets into our analytics hub and better manage business workflows, please reply to this email. We are seeing traction with Data & Analytics and RevOps teams as landing personas within organizations.
We are actively building a pipeline of formal pilots; anyone can create a free trial at workstream.io.
Hiring:
In the months since closing the Seed financing, we have spent time augmenting our fantastic technology team with business talent.
This brings our team to a total of 11 and speaks to our focus on building new muscles around go-to-market – specifically generating broader awareness & growing our customer base – and more rapidly deploying customers. Hires include:
Adam Guan, Software Test Engineer
Ethan Peterson-New, Customer Enablement Manager
Robin Francis, Director of Marketing
Joe Gannon, Account Executive
Given the current macroeconomic environment, we feel this strikes the right balance between bringing on the right resources to accelerate building the business and managing cash burn.
Successful Deployments:
Before the announcement, we had seen enough successful deployments in our private beta group to understand what a successful deployment looks like and how to enable it.
An analytics person creates a workspace, builds an initial collection of assets for a specific function (we now have a long list of integrations), and curates some relevant context and documentation. They then invite other team members to join, who leverage our solution as a centralized place to access analytics & reporting and to collaborate on their data.
Usage-wise, we see huge spikes in product engagement as analytics teams (our power users) build out collections and knowledge in our system; post-rollout, adoption settles into a steadier cadence across a much broader swath of users in their org. This cycle repeats as new collections are built and new functions are onboarded. At steady state, 40-50% of users in an engaged org are active in the product every day.
We are actively working with our beta customers to convert into formal paid accounts with significant contract value. More details on this are coming soon.
Growth: Bottoms up <> Tops Down
In the weeks following our public beta announcement, hundreds of people we had never spoken with discovered our product and set up free trials via our website. Our messaging of consolidating disparate analytics assets and workflows is resonating.
As a workflow solution that is organically adopted within organizations, we will continue to invest in driving broader awareness so that prospects can frictionlessly trial our product and provide touch-less training & enablement.
Growing this bottoms-up motion is the primary focus of our marketing activities and investments, as we want more and more teams to find us and see quick value in our solution without direct intervention from us. This part of our motion is new, but as a workflow tool, we view it as critically important to our long-term growth strategy.
In parallel, we are investing in more traditional selling: direct outreach to teams fitting squarely within our ICP, as well as pilots where we work hand in hand with prospects to roll out our solution and become formal (paid) customers. This closely resembles our engagement model during our private beta, and we continue to see success with it.
As we build our go-to-market engine, we will work first to generate momentum across both vectors. And as we head into 2023, we believe our success will be about elegantly bringing these two elements together.
Current Focus:
As we round the corner of 2022, here are some of the big things we are focused on.
Doubling down on our analytics hub
As our message and the value of consolidating assets and workflows into our analytics hub continues to resonate with customers, we are investing in supporting more and more “asset types.” Today the list includes BI tools like Looker and Tableau, general productivity solutions like Sheets, Slides, & Docs, and native reporting in operational systems like Salesforce.
We are constantly working to support more analytics tools, and excitingly we have gotten into a cadence where we can release new ones quickly (i.e. within a couple of days of development). Our immediate roadmap includes product analytics solutions, data notebooks, and the Microsoft Suite. We hope to double the number of supported asset types by the end of the year.
This affords more flexibility to our analytics hub, allowing us to support more customers, deepening our ability to centralize existing customer environments, and affording us numerous opportunities for partnerships and go-to-market efforts.
As we work to make our analytics hub more extensible, we also continue to invest in making it a better, more intuitive, and refined experience. Before we begin investing again in new features and functionality, we are actively actioning customer feedback to make the product we have work better and feel more feature complete.
Go-to-market
With more conviction than ever before that our messaging and product value is resonating, and true understanding of our pathway to customer adoption and love, we are making disciplined investments in driving broader awareness of our company and our unique offering. These include:
Contributed Content to both media outlets that speak both directly to our champions, and business leadership more broadly. Feel free to read my recent article Data Teams: Kill Your Service Desk, which was published in Towards Data Science.
Speaking engagements online (videos, podcasts, etc.) with various thought leaders and at 2-3 conferences happening in the upcoming months.
Re-investing in our proprietary content, including our video series where I’ll interview business and data leaders about the interpersonal dynamics of data-driven decision-making, including their trials and triumphs.
All of this will feed our SEO / SEM strategy, with the ultimate goals of bringing people into our ecosystem and inspiring them to discover, install and adopt our solution.
I will be in touch with more of our progress in these areas. In the meantime, please do not hesitate to reach out if you have any questions or want to learn more.
Best,
Nick
Across the Pennies Barrier (Jan 2023)
Hi Everyone –
My sincere apologies for the lack of an update at the back end of last year. At the risk of oversharing, it was a difficult time for me. Our third child Isabella was born six weeks early, and then a week later my brother passed away while the baby was still in the NICU. And so my focus was really on family and keeping our business pushing forward. That said, I was remiss in keeping our group of investors updated and so my goal is to begin to remedy that this week.
Please note that since we are about two weeks away from the end of our fiscal year, I will send an end of fiscal recap (with some of the same content) to this group & our broader group of supporters in the first week of February.
FY 2022 Recap
I am happy to let you know that we are no longer a pre-revenue company! We have signed up our first few paying clients for not insignificant ($12K/year+) annual, prepaid subscriptions to our Data Knowledge Management solution.
As we look towards the end of our fiscal year (ending 1/31/23), we are pushing hard to convert a handful of additional accounts and cross the $100K ARR threshold. Within this initial customer group, there are larger accounts ($30K+ in ARR) we are working to convert, and significant, contracted growth potential. If we can capture the full opportunity in FY 2023, this initial customer cohort could more than double to $200K+.
The headwind with regards to monetization is that, as we look at our FY 2023 goals, we need more sales opportunities and pipeline, and we need to speed up our sales cycle and move deals faster. So we have work to do in establishing our category, staffing demand generation
& sales development, and creating urgency in a difficult environment to sell enterprise software.
With that, here is a broader round-up of our progress in this fiscal year, a view into where the business currently stands, and insight into our goals for FY 2023.
Financial Update
We currently have ~$2.9M in the bank, and per our operating plan we have a runway into the end of Q2 2024. In addition we have a $1M loan facility from SVB that we can draw as needed, although of course I would prefer to not put debt on the balance sheet if we can avoid it.
While the environment for fundraising has radically changed in the past year, I do feel that our runway + increasing traction will put us in a good place to raise as we head into the end of 2023 / beginning of 2024. Ultimately, the composition of our next round will be determined by our continued progress towards our goals in FY 2023 (covered at the end of this update).
User Adoption
Since our public beta launch, we continue to see interest and installations of our free product. While this is a great early sign, the issue is that our larger and successful deployments require support and effort from our implementation / pilot team. We often see folks coming in to sign up, but we have not had success yet in converting them en masse to active users.
Here are some high level stats on user adoption:
16,000 analytics asset under management
400+ workspaces, with over 500+ total users
80-100+ monthly active users (+/- month to month), with DAU/MAU in the 20% range
Proving the Value of Data Knowledge Management
To illustrate the value of our offering, and why customers find it compelling, I would like to focus on a customer (Gusto) who is finalizing their purchase of Workstream; the final deal should land at $30K+ / year to start.
If you are not aware, Gusto is a US based payroll and benefits provider historically valued at $10B+. They have a massive customer support organization, consisting of hundreds of front-line employees and 60+ managers.
Ensuring that all these support managers have access to the appropriate reporting has been historically difficult, because their reporting is scattered across many different systems. In parallel, as a high growth organization, they are constantly onboarding new support managers – so training new leaders to understand and manage team and individual performance is a cumbersome, laborious effort.
We landed with an initial pilot group of less than 3 users, and are approaching an initial rollout of 60+ total employees.
Centralizing Analytics & Reporting through Data Asset Management
With Workstream, this customer is now providing centralized access to core analytics and reporting assets through our single access plane.
This includes reports from: Tableau, Salesforce, Redash, CX One, Airtable, and Google Workspace.
Initially deployed as a place to find curated and certified reporting assets, members of their workspace can also add their own reports – making Workstream the single place users go to access any data & reporting
Curating Knowledge & Managing Workflow in our Repository
In addition to consolidating previously disparate assets, this customer is also curating in-line how to guides, documentation and training videos. Each manager can not only find the reporting that is relevant to them, but they can use Workstream to understand how to use it in managing their team. And if there are questions, users can start conversations directly in context with their live data assets – all without having to visit another system.
The operational benefits are clear enough that this customer is not only buying, but making operational changes to hiring plans that allow them to directly capture a return on their investment in year 1 and justify the purchase.
Product Development
We continue to take a customer driven approach to evolving the major capabilities of our Data Knowledge Management solution, which allows teams to consolidate their disparate data assets, and empower their organizations through knowledge sharing and in context collaboration. We grew our supported integrations by 4x, and now have 25 integrations and growing across the three core pillars of our platform.
Within our Data Asset Management pillar, we made major inroads in making Workstream the place that teams create, access and manage analytics assets. A major focus was making our solution more relevant and central to every team’s environment. We now support a lot of “analytics assets,” which tactically means different file types. This includes dashboards, reports & data sets across business intelligence, data notebooks, product analytics, general productivity and operational SaaS applications. We also evolved our system’s capabilities around access control, giving users more control and transparency into how objects are shared in our system.
We enhanced our Knowledge Repository, better empowering teams to understand how to use their data assets, and best inform decision making. We enhanced our offering to support real-time multiplayer editing, and to allow teams to embed Youtube and Loom videos as part of asset documentation in our system. Finally, our dbt Labs integration now exposes upstream data quality to data consumers.
We advanced the capabilities of our Integrated Workflows to deepen our collaboration capabilities, including support for visual annotations within conversations. And we now help teams automate monotonous tasks, by automatically creating bugs in a data teams’ backlog via our JIRA connector.
All in all, we wrap FY 2022 feeling that the product is v1 feature complete, and that it is ready to support our growth plans for the upcoming fiscal year.
Looking ahead to FY 2023
As I say every January, this is a make or break year for the company. The product is ready, and so we are putting all the firepower we can into taking it to market, generating awareness of our new category, acquiring customers and activating them.
Sales and customer acquisition goals
Here are some of our high level goals moving forward:
Achieve $1M in ARR as quickly as possible.
5X the number of workspaces, users and assets supported by end of FY 2023
5X our daily active users, grow to 25%+ DAU/MAU, and increase quality of usage (time spent in the app per day) for paying customers by the end of FY 2023
Creating and evangelizing our category
While I won’t dive into our explicit plans with regards to product, sales development or customer implementation, I want to speak about our category creation efforts, as it becomes clear that we are truly building something new.
As we continue to see progress with customer adoption, and hear what is resonating with prospects, we can now name what we do (Data Knowledge Management), define its contours, and evangelize why it is so important to teams.
Our goals are to establish Data Knowledge Management as an essential solution for data driven organizations, clarify why it is different from anything else out there, and ensure we are the leaders in this new space. Two key pieces to this puzzle include launching:
the Data Knowledge Newsletter, a weekly series exploring how teams capture, curate and disseminate knowledge about their data
Data Knowledge Pioneers, a monthly video series where I’ll be speaking with data leaders and practitioners about the acute problems they face in this area
The first installment of the newsletter launched last week, and the show will be launching later this month.
New team members
Our technology team is rock solid, and so as we enter 2023 we are investing in expanding our go-to-market capabilities (both in house, and on a contract basis).
Here are some of our new team members, as well as a few critical roles on the radar.
Mary MacCarthy, Social Media Manager (contract): focused on amplifying our message around data knowledge and generating awareness of our product/category
Westin Bennett, Account Executive: Westin is our second sales hire, and he’ll be focused on helping us build pipeline and move SMB deals. He used to work closely with Joe Gannon at ProductBoard.
Ted Conbeer, Data Consultant (contract): Ted is helping us track, measure and analyze all stages of our customer acquisition and adoption funnel
Account Development Representative (TBH) : we are hiring for a high potential ADR to take our pipeline generation activities to the next level.
Demand Generation Manager (TBH): this person will own demand generation and customer acquisition campaigns to convert awareness into leads / freemium installs.
With that, I will keep you posted on our progress towards these goals in the coming months, and as always don’t hesitate to reach out if you have any questions.
Best,
Nick
Wrapping FY 2022 with $50K in ARR (Feb 2023)
Hi Everyone,
As I promised last time, here is an update on our metrics now that FY 2022 (ending 1/31/23) has officially closed. If you would like to read the latest qualitative update (with largely similar content as a few weeks back) sent out to the larger supporter group, just scroll down.
Note: going forward we will be moving our investor reporting cadence to the end of each fiscal quarter.
Sales
FY 2022 ARR: $50K (up from $0 starting in Q4 2022)
Paying customers: 3 (Collegis Education, Dr Squatch, BetterCloud)
Average revenue / account: $17K
New sales pipeline:
ARR: $203K
Accounts: 12
Product adoption
Customer acquisition
Total users: 495 (+25 in January, up 80% vs +15 in Dec)
Total workspaces (unique accounts): 309 (+13 in Jan)
User Adoption in January
Daily active users: 31
Monthly active users: 93
DAU/MAU: 33.6%
Assets
Total under mgmt: 15,761
Financials
Ending cash in bank: $2.8M
Monthly burn: $175K
End of runway: May 2024 (assumes current burn + no incremental revenue)
Notes:
We were still pre-revenue as of 12/1/22. So while we did not cross the $100K ARR threshold as I wanted, I’ll call this major progress for the business.
Fighting through Headwinds (May 23)
Hi Everyone —
Here is an update on our progress and learnings at Workstream.io now that Q1 2023 has closed. (As a reminder, we are on a non-calendar fiscal and so Q1 2023 ended on 4/30).
Before my color commentary, here are some of our core KPIs:
Sales:
Total ARR: $81K (+$31K)
Paying customers: 4 (+1)
ARPA: $20K
Total Sales Pipeline: $112K (-$91K)
Note: see sales pipeline section for explanation on ins/outs
Product Usage
DAU/MAU:
April: 22.5%, up from 19.5% in March and 16% in January
Users:
Monthly Active: April: 65; down from 99 in March but flat with 66 in January
Total: 574 (+12)
Workspaces
Monthly Active: April: 27; flat from 28 in March and up from 19 in January
Total: 363 (+22)
Assets under management: 17,312 (+1,551)
Runway
$2.25M in bank
Burn $170K/month
(option) $1M SVB loan, drawable until year end
Cash out date: June 2024 (without loan draw)
Sales
Our progress with regards to go-to-market is a story of good and bad news. Overshadowing all of this is the challenging macro environment that most directly impacts us through companies tightening and/or freezing budgets for bringing on new software (much less a solution that does not fit into any pre-defined category / budgetary line item).
New Sales Achievement
We closed won our largest customer to date in Q1: Feeld for $31K/year. This is a high water mark for our business, and has a number of implications for our go-to-market motion, our ideal customer profile, and how we think about our potential market.
This deal proves that we can move new pilots quickly. It took approximately a month between kickoff and achieving mutually defined success criteria / getting sign off from our buyers.
Sales Pipeline
While a major focus in Q2 is accelerating new pipeline creation, the good news is that we created a handful of new opportunities, two of which are right in our ICP and are actively piloting.
Customers
Unfortunately, the opportunities we lost in Q1 blunted our overall progress with regards to sales growth. Closed lost deals include accounts where folks showed interest in 2022 but then ghosted us as the market turned; as well as hard nos. In this latter category were Gusto ($38K), and SingleOps ($10K). Putting aside the idiosyncrasies of each deal, key learnings:
We allowed each pilot to drag, and we did not get alignment with our buyers on pricing before engagement. This is partially an overhang of our engagement model during the private beta, but nevertheless key mistakes to avoid going forward.
Both customers do not fit our redefined ideal customer profile (see below): one based on company size (too small), and the other based on buyer profile (our champion/exec buyers were not Manager/Director/VP of Data & Analytics).
Re-defining our ICP and Reworking Messaging
This quarter, we hired and ramped our first Account Development hire in Q1; this is the person who is primarily responsible for prospecting on our team.
On the positive, we proved that we can predictably create meetings (averaging 1 meeting set / day on outbound prospecting activity). However, we did not prove that we could repeatedly convert this activity into new pilots / active pipeline. This feeds into two key learnings from Q1, which we are now applying to our go-to-market efforts across the board.
Sharpening our Ideal Customer Profile: Based on the customers we have closed, and the pilots we can create and move, we have a clearer picture of who we should be going after and current willingness to pay:
Company profile: Technology companies between 100 and 500 employees
Buyer profile: Manager/Director/VP of Data
Data team size/maturity: Team of 3+ people with “mature” implementation of data & analytics technology/programs
Purchase/implementation pattern:
Buy-in from above profile who:
Feels the pains that investing in data knowledge management solves
Commits to pilot
Delegates pilot/roll-out to individual contributor on their team
Data teams sets-up environment, and then rolls us out to business (starting with go-to-market functions)
Honing the Data Knowledge Message
Based on detailed interviews / feedback sessions with our existing clients, we completed a full reworking of our messaging and positioning in Q1. This messaging is now reflected on our website, as well as external facing sales and marketing materials.
The goals here are to clarify a) for buyers the acute problems we solve, and b) that this is a new category that should not be confused with adjacent solutions. A few tidbits that I’ll share:
Our category: Data Knowledge Management
What we do: We help companies transform the massive quantity of data available to them into actionable knowledge that everyone can act on.
Key benefits to Workstream.io:
Create a trusted repository of data assets (so people know what data to use)
Enable everyone with data knowledge (so people know how to apply data to their job)
Uncover actionable insights about the data people use (so teams can understand what value data is bringing and improve their environment accordingly)
In our next update, I will speak to our efforts in creating awareness and evangelizing the Data Knowledge Management category.
Product Adoption & Usage
Since the beginning of the fiscal year, we’ve placed an emphasis on understanding user behavior across our web app and extension, so that we can drive deeper engagement with the product and ensure that our new paid customers are activating effectively.
As a Data Knowledge Management solution, we want our product to become the jumping-off point for data users to find, curate, and communicate about their organizations data knowledge. Improving this engagement is a primary goal of many of our recent product releases, like Workstream Docs, a revamped Environment Insights page, and a host of quality-of-life improvements launched in Q1, including auto-adding assets.
We see DAU/MAU as an important measure of engagement as a whole. Over the course of Q1, DAU/MAU climbed from a holiday-impacted low of 13.6% in December to 19.5% in March and 22.5% in April.
Throughout Q1, we continued to onboard new users into existing accounts and drive installations of free accounts. For most of 2022 and the first part of Q1, we had invested in almost-daily LinkedIn content on both our company page and Nick’s personal page.
In April, we paused that LinkedIn content, in an effort to reorganize and double down on a video-first strategy. We saw new installations drop off substantially, from a six-month high of 34 new users and 15 new workspaces in March to 12 to new users and 9 new workspaces in April.
Looking ahead to Q2, we are in the process of re-launching our social efforts and implementing a video first strategy. This includes our weekly Linkedin Live show, Data Knowledge Pioneers, as well our daily Data Knowledge Shorts that together serve as the tip of our content marketing and demand gen strategy. This will take time to bear fruit, but we feel confident this strategy will sustainably drive new installs (and new pilots) above and beyond January-March levels. With newly added and planned features for Q2, we expect the activation, retention, and conversion of these free accounts to exceed historical rates.
The decline in new users was the primary cause for lower overall MAU numbers for April; after growing 19% in March to 101, MAU fell 34% in April to 65. Some large, paid accounts that ramped in March also saw declines in MAU in April, after their evaluation periods ended. We aim to re-engage these accounts and drive additional adoption with business reviews of existing and new features.
Financial Posture and Wrap
From a financial perspective, we still have approximately half of our last round in the bank, and runway until June 2024. If you include the drawing of our $1M loan facility, that buys us another six months until the end of 2024.
As we think about the path forward, we are focused on applying the lessons from Q1 to accelerate growing the business and our user base, and driving product engagement across new and existing clients.
Despite the headwinds and challenges, I am excited about our progress and what the next few months will bring to the business. As always, don’t hesitate to reach out if you have any questions.
False Signals & Hitting $100K in ARR (August 2023)
Hi Everyone —
Here is an update on our progress and learnings at Workstream.io now that Q2 2023 (ending 7/31) has closed. Below are some core KPIs, followed by commentary on our quarterly performance and learnings.
Key metrics
Sales:
Total ARR: $101K (+$20K)
Paying customers: 5 (+1)
ARPA: $20K
Total Sales Pipeline: $205K (+$93K)
Product Usage
DAU/MAU: ~16% in Q2
Users (active / supported / total)
May: 87 / 110 / 607
June: 110 / 141 / 674
July: 83 / 117 / 703
+ 128 total users since April
Workspaces (active / total)
May: 22 / 358
June: 22 / 376
July: 24 / 389
Assets under management: 20,128 (+2,816)
Runway
$1.8M in bank
Burn ~$170K/month
Cash out date: June 2024 (without $1M SVB loan draw)
Overview
In Q2, we made huge progress in establishing our go-to-market and getting the word out. We saw our category creation efforts start to bear early fruit, and we crossed the $100K ARR threshold in the quarter. July, a historically slow month for selling enterprise software, was also our best month ever for pipeline creation.
Importantly, the new pipeline came as the direct result of our sales and marketing efforts (including content and outbound prospecting), which is a great starting sign of repeatability. It also results from us continuing to sharpen our messaging around data knowledge.
At its sum, this leaves me continuing to feel that the category we are creating is a massive, blue ocean. I believe our market is as large as, or a substantial fraction of, business intelligence, a crowded $100B market.
On the flip side, the headwinds we experienced in the quarter were two fold: first, while we created pipeline and hit sales milestones, we have not yet experienced an overall breakthrough with sales or customer acquisition. Second, while we do maintain a base of users that actively use and are supported by our product, we have identified a clear pattern of user attrition over time.
More details follow on our performance, key learnings and the associated actions we are implementing.
Marketing
I have written about our content efforts before, but (to simplify) our goals are to use content to a) educate the market about the data knowledge category, b) generate awareness of Workstream.io as the leader in the category, and c) create leads for sales.
In Q2, we found our sweet spot and started seeing real results with our first two goals. Worth mentioning here was our decision to double down on video as our primary content medium.
The above graph shows our growth in impressions of social posts across the company and my personal accounts. The major trend upwards in May coincides with us implementing our “three pronged” approach to top of funnel video content:
Our bi-weekly show Data Knowledge Pioneers, live streamed on Linkedin. The show explores a variety of topics with guests around data knowledge that we believe are relevant to our customers and prospects.
Daily social media shorts about data knowledge, which include one of clips from me and clients, as well as from the show.
The new learning center on our website for DKP, which houses all of our long form video content and over time will be a major conversion point for us.
I look forward to sharing more in the future about how we will build upon these wins to amplify awareness and accelerate pipeline generation.
Sales
We have hit the $100K ARR milestone; $1M is the next one up and we are pushing to get there as quickly as possible.
Pipeline generation is of course a leading indicator of future sales, and so hitting a historical high water mark for pipeline creation in July is a great sign. As I write this, we have more active pilots happening in parallel than ever before.
Q3 will be a big quarter for us in converting these opportunities to clients, and proving ongoing repeatedly in pipeline generation.
Product Value & Adoption
The problems around data knowledge, and the value of a system to manage it is increasingly clicking with data teams.
Teams know that despite their successes in making data available, data ultimately does not matter if people cannot apply it to impact the business. Knowledge gaps around applying data might include unanswered user questions around:
What data should I use?
How should I use this data?
Can I trust the data at this specific moment?
How have others applied this data in the past?
To address these gaps, data teams create knowledge in our system and share it with the end users of data at their organization.
We have established this rollout pattern — a huge win — but there is more work to do in hooking the majority of those users to remain active in Workstream as their ongoing source of data knowledge.
When we dig into current user engagement, we have clear data about the importance of the Workstream Concierge (currently embodied in our chrome extension) in activating customers and in keeping users active en masse. Put simply, all of our active users have installed the Concierge and then remain logged in over time.
If we take one of our first customers as an illustrative example of the dynamic that we see, they have onboarded 27 users onto Workstream. Of those:
(Cohort 1) 14 users are “supported users”:
This means they installed the extension and remained logged in this past month
Of those users, 8 actively used the system to consume knowledge and collaborate
No users outside of these were active last month
(Cohort 2) 9 more users installed the extension at one point, but did not login in the past 30 days.
(Cohort 3) 4 never installed the extension and never became active on a recurring basis
When we look at these three cohorts, our challenges are:
(Cohort 1) How do we get supported users to become active more often by seeking out knowledge in our system?
(Cohort 2) How do we add enough value to the Concierge that people will continue logging in every month?
(Cohort 3) How do we make the value of the Concierge so obvious to these users that it’s a no brainer for them to install?
I believe that the answers are informed by what people choose NOT to do in our system today. When we break out the “types of usage”:
90% of product usage is for a) curating and b) consuming knowledge
10% of product usage is for communicating
By the end of the year, we will make it 1) 10X easier for teams to get knowledge into the system, and 2) 10X easier for them to get knowledge out. And we will prove to teams that 3) through the system, business users will get their answers faster, while the data teams will be able to automate the day to day busy work of supporting the business.
We will do this by making data knowledge available to everyone wherever they work, on demand via the Workstream Concierge.
Data knowledge wherever
The value of the Workstream Concierge is that its form factor (currently a chrome extension) brings our knowledge INSIDE where teams already consume data. To watch a training video (for example) about how to use a dashboard, users can view the video on top of the dashboard itself.
But while the extension brings knowledge to where folks consume data, right now it does not bring it directly to where they communicate about it. Stakeholder - data conversations generally default back to the old, but fraught, shared slack channels - or ticketing systems. To make our knowledge available in this context, we will bring our experience INSIDE these existing channels where teams already communicate about their data.
Data knowledge on demand
While these existing behaviors have gravity, ask teams if they like this form of user support via Slack. The answer is no.
Data teams hate this support paradigm because they feel it is a repetitive time suck that interrupts them from the bigger and more important data work. Everyone else hates making requests in this way because they have to wait for answers; and shared knowledge quickly becomes undiscoverable in a flurry of unrelated messages.
In the coming months, we are working to both a) make the Concierge available wherever teams work, most importantly these shared slack channels, and b) make it intelligent so that it can automatically provide answers to data users based on the knowledge living in our system.
I believe this will fundamentally change the investment and behavior change required for everyone to get value out of our system, and unlock the next phase of usage and engagement. It will also sell really well.
As always, don’t hesitate to let me know if you have questions about this last quarter, or the months ahead.
Nick
The ride of the Rohirrim
Flatlines & pivots (Nov 2023)
Hi Everyone,
Here is an update on our progress and learnings at Workstream.io for the quarter ending 10/31/2023. I will start with sharing some key metrics, followed by my color commentary on where we are and the path forward.
Key metrics
Sales:
Total ARR: $101K (flat)
Paying customers: 5 (flat)
ARPA: $20K
Product Usage
DAU/MAU: ~15% in Q3, down slightly from ~16% in Q2
Users (active / supported / total)
August: 66 / 104 / 652
September: 77 / 112 / 686
October: 98 / 130 / 731
+ 103 total users since July
Workspaces (active / total)
August: 33 / 394
September: 32 / 419
October: 52 / 458
Assets under management: 22,832 (+3,201)
Runway
$2.2M in bank, this includes $1M of proceeds from drawing our SVB loan
Burn ~$175K/month
Cash out date: May 15, 2024 (excluding SVB proceeds) / September 1, 2024 (including SVB proceeds)
The bad
While I’m proud that we went from $0 to $100K in ARR since we started monetizing last December, this was the toughest sales quarter I have experienced in my career. We did not close new deals or materially move the needle on growth.
To an extent, this reflects the macro environment we are in. 75% of the customers we initiate conversations with start off by telling us that they have no budget, and are not considering new software. Our largest opportunity to date ($40K+) was at the finish line in early Q3, only to have half the company including our champion laid off. Unfortunately, these are conditions outside of our control.
But there are also headwinds idiosyncratic to Workstream. Our new messaging continues to communicate the unique value of data knowledge, and how it enables everyone at a company to apply available data. But while it does resonate with clients – and folks are interested – we have heard many times that teams are not ready to adopt, or perceive it as a current nice-to-have, creating a lack of urgency to move forward. We also heard feedback that our price point (ASP = $20K) was too expensive, and was a contributing factor to pilots that lost momentum. These are hard but important learnings, and I’ll cover our action plans to address them in the sections below.
From a company financial standpoint, at the end of the quarter we had ~$1.2M in cash left in the bank, giving us runway until mid May of 2024. While we are actively planning for an equity raise, we felt it prudent to draw our $1M SVB loan facility to give us extra cushion. Net net, the draw of our loan facility brings our cash on hand to $2.2M and extends our runway to September 2024, giving us some flexibility in pursuing equity financing options.
The good & action plans
To the positive, the investments we are making in driving awareness of the solution and data knowledge category continue to pay off. Brand awareness continues to be up: as an example, social impressions across all our channels were at ~15k in October, up from ~10K in July and 2K in April. We also saw an uptick in installs this past quarter, and consistently hit 30+ active workspaces per month – indicating that there is some untapped potential within the freemium base.
From a content perspective, we concluded the second season of our Linkedin show Data Knowledge Pioneers and shifted our focus to driving sales impact during the events season. We had live sessions at both the dbt Coalesce conference in San Diego, as well as Monte Carlo Impact Online. (See links for session content if you are curious). Across both events, we were able to engage with hundreds of potential clients, and are scheduling follow ups.
One of the exciting developments from these conferences was not only unveiling our new dbt and Monte Carlo integrations, but the feedback about the new data incident workflow module that the integrations power. This new module was designed alongside existing clients, and helps data teams automate their workflow around data incidents.
Feedback was extremely positive, and we are now experimenting with leading with this module as our new “land” motion with new clients. There appears to be more urgency among prospective clients to adopt new software to help here, with folks more readily agreeing to next steps and sales conversations. We will be doubling down in pushing this new module and messaging in the coming months with the intention of catalyzing new sales opportunities.
On pricing, we heard the feedback and rolled out a new pricing strategy in the last weeks of the quarter. The key things to know are that we are now offering a lower entry level price point, as well as monthly payment options starting at $800/month. From a sales perspective, we are now pushing prospects to “get started by spending just $800 and no risk onboarding”, versus engaging in a formal pilot required to justify a larger initial purchase.
These are all fresh changes from the last few weeks, so we will keep you posted on the results and evolve our strategies accordingly.
The next six months
Operationally, our goals are to re-accelerate sales as quickly as possible. We will do so through the above mentioned changes, air cover from marketing to drive awareness and leads, and the up-coming launch of our AI powered data concierge.
There are many use cases for the soon-to-be-released AI powered Concierge: it will automatically surface data knowledge to users via their Slack channels, and answer their questions about data. But we will most immediately position it as an extension of our new data incident module, assuming we see continued traction of our investments there.
We have been working on the Concierge since late summer – in parallel to other product development – and are pushing to get it into alpha for existing customers immediately. From there, we aim to launch it into a sellable state by early 2024 (exact timing is TBD).
From a sales perspective, we believe these new investments will help us achieve $250K in ARR in early 2024. This will more than double our ARR, and put us on a viable pathway to achieving the $1M ARR milestone by the end of next year. From a financial perspective, we believe this will position us to raise additional equity capital in 1H 2024.
As always, I will keep you updated on how things continue to develop, and do not hesitate to reach out to me with any questions.
Leaving it all on the field w/ Data Incident Management (Feb 2024)
Hi Everyone –
I hope that this email finds everyone well. Here is an update on the state of business at Workstream.io for the fiscal year ending 1/31/2024.
Unfortunately, the end of FY 2024 continues to find the business in a very tight spot. I will start by sharing key metrics, followed by thoughts from me on what happened last year, what we are doing to address our learnings, and how we are working to make this crucible moment our turning point.
Key metrics
Sales:
Total ARR: $69K (-$32K)
Total Sales Bookings: $62K (+62K)
Customers:
Team (paying): 3 (-2)
Core: 1 (+1)
Total workspaces: 566
Notes: see below commentary for definitions / thoughts on these different cohorts
ARPA: $23K
Product Usage
DAU/MAU: ~14% in Q4, down slightly from ~15% in Q3
Users (active / supported / total)
November: 76/ 94/ 769
December: 64/ 87/ 804
January: 73/ 91/ 847
+ 103 total users since October
Workspaces (active / total)
November: 40/ 490
December: 36/ 525
January: 47/ 566
Environment management
Assets under management: 24,278 (+1,446)
Assets with Status Pages: 1,625 (+1,625)
Incidents under management: 622 (+622)
Runway
$1.67M in bank, this includes $1M of proceeds from drawing our SVB loan
Burn ~$185K/month
Cash out date:
May 15, 2024 (excluding SVB proceeds)
September 1, 2024 (including SVB proceeds)
FY 2024 Recap
To summarize fiscal year 2024 for everyone: we first began monetizing in December of 2023, and so FY 2024 was our first year selling our Data Knowledge Management product.
The first six months started strong: to $101K in ARR by 5/31/23. We then had a breakout pipeline generation month in July 2023. It felt like we had sales momentum, and our challenge as a business in getting to $1M in ARR was to begin to more predictably:
Make that level of pipeline creation become the norm
Move pilots and close deals.
We believed the potential to do this in that we had landed our data knowledge product and messaging, had honed in on a target ideal customer profile, had shown that we could create a pipeline through our sales motion, and had closed clients paying us up to $30K/year.
Unfortunately, sales efforts across both vectors fell off a cliff in Q3, and it became clear by October that we had to make radical decisions around our product offering, and how we go to market.
The changes we have made since then include repositioning our core product offering: we now lead with our new data incident automation module. It also includes our pricing and packaging: we now offer monthly pricing for our Team plan, and a new free SKU called Core that we launched on February 5. It extends to our messaging: if you go to workstream.io, the hero is now “Workflows Designed for Data Work | Meet the new standard for data workflows.”
Net net, I am proud of our hard work in 2023, the grit and perseverance our team has shown, and confidence that the changes we have made are the right ones, and will yield the transformation in our business that we need. But I am also deeply unsatisfied with the numbers, frustrated with our overall position, and realistic about the reality of what will happen if that transformation does not come quickly.
We will leave it all on the field to make this moment not the end but the inflection point for the company.
Leading with Data Incident Management
Unfortunately, not only did we not sign up new clients for the second consecutive quarter, but we experienced churn in Q4. Two (MacroFab, BetterCloud) of our five paying clients canceled.
To the positive, we also renewed two clients (Collegis Education, Dr Squatch) in Q4. Both renewals were flat, but Collegis did sign a 2 year contract worth $50K in total contract value, paradoxically making Q4 our highest booking quarter since inception with $62K total booked.
When analyzing churn, I am hesitant to read into it too much because the n here is still so small - and there were true idiosyncrasies to both clients that canceled. But if we are going to intuit any learnings: the clients who are sticking around are those that are also adopting the data incident management module that I mentioned previously, and which we are now leading with.
It is very clear the pure play data knowledge product (use case = enable everyone at your company to use the data available to them) is seen in the current market as a nice to have; independent of anything else, we saw this play out in customers that struggled to get widespread adoption, pilots that never progressed, or the reactions we heard from many prospects that this felt like a “nice to have.”
Yet we have the kernels of market pull from customers and prospects on our positioning as a data workflow solution, and that our new data incident workflows can solve acute problems that teams have. We first announced this new positioning around data incident management (think Pagerduty for Data Work) in late October, and got the product truly sellable in January.
I am hopeful that in February we will land our first net new client with data incident management as our core use case. This is on our Team SKU, with our new, lower price point (Listed at $800/month). And I’m optimistic that we will activate more clients on our new Core SKU, which is free and which I will talk more about below.
Our pathway forward is to drive enough traction with data incident management, and momentum with data teams adopting our Core and Team SKUs, to give the market conviction in our direction, and the multi-billion dollar market opportunity that I still truly believe that we are pursuing.
Where We Are Going Next with Data Incident Management
We are frustrated that we do not already have more sales traction with this new direction to report. The compassionate explanation is that we announced it right before the holidays, and only got it in a truly sellable state a month ago.
The less compassionate explanation is that of the prospects we have pitched, there were a number of reasons people were not ready to engage or move forward:
Smaller companies (sub 100): their pains in this area were not great enough yet.
Larger companies (more than 100 employees):
Data engineers -> don’t like salespeople, want to “try before they buy”
Budget freeze / not buying new software
Require integration with systems not currently supported
Have mature processes leveraging existing incident management solutions
When speaking with smaller companies, they do not experience acute problems around data incident management en masse. It is the larger, mid-market to enterprise companies where this is a fit: these data teams are larger, manage more data and data products, and have a larger group of stakeholders / internal clients to support.
These are the things we are doing to build momentum with these larger clients:
Launching our Core SKU and activating Core clients
While we continue making large investments in content marketing – specifically video – to drive awareness, our G2M in the past year has been sales led. While we have had 550+ people set-up workspaces via our website in the past two years, getting folks to evaluate were the results of outbound prospecting and high touch on-boarding.
Unfortunately, at the lower price points necessitated by the end of ZIRP, and with more technical power users (data engineers), a sales led strategy has serious flaws. At our current price points, outbound customer acquisition will be too expensive to scale. And short term, more technical power users want to try and adopt software before they buy. Engineers hate being sold to.
All of this led us to formally announce our Core SKU for free, with the goal of proving in the coming months that we can onboard clients onto it through a product-led motion, and get them activated in a more efficient way. A lot goes into that, but the intent is that this becomes the long term motion by which we will scale sales.
In the short term, we are also leveraging core as a “sales pivot” when a prospect directly engaged by sales either does not have the budget, or is not ready to move forward.
Winning Team clients by expanding our data incident capabilities
Our data incident automation alerts data teams of issues in a centralized workflow, allows them to triage their on-call process for resolving data incidents, and automates stakeholders communication via in context alerts and status pages. These capabilities leverage the platform we have spent years building, and I really see it as the wedge by which we can land clients and expand them onto our other capabilities (ie, our holistic platform for data workflows) over time.
Pivoting our go-to-market this way feels right, with prospects more easily understanding the value prop, indicating that this is an acute pain they want solved, and more willing to move forward. Coupled with lowering our price point, and offering monthly pricing, we have addressed feedback from prospects that the product felt too expensive.
Currently, these data incident capabilities are powered by two integrations – dbt Cloud, and Monte Carlo. But these are only two of many systems that folks want us to support, including an integration with dbt Core (the open source offering), and accepting inbound alerts from any system they might want to send us (from their data warehouse, to their BI tool, or even data pipelines).
Functionality wise, we also encounter larger, enterprise prospects who have mature process needs but who already leverage an existing incident management tool. This is great validation, but a more difficult rip and replace scenario. To win these customers will require not just more integrations but more advanced functionality. This includes a lot of features such as a deeper slack integration, finally launching our generative AI capabilities, the ability to set schedules for an on-call team, or sophisticated alert routing rules (to just name a few examples).
We are working to address the core blockers across both a) integrations and b) more advanced functionality in both February and March, and impact our ability to appeal to and close deals short-term.
Operationally, our goals are to run up the score with both Core and Team clients in the coming months, unblock customer acquisition and sales, and put ourselves on the glide path to achieving $1M in ARR as quickly as possible.
Financing and Macro
While I have more conviction than ever in these moves, our strategy, and the opportunity, the difficult reality is that we have relatively little runway to prove it.
The proceeds of our SVB loan extend our runway from 5/15 to 9/1. But burning that capital is ill advised if we do not have a pathway to financing the company through the infusion of new equity. In order to do that, we need to win new Core and Team clients by 5/15.
That is a very short window, but I’m confident in our ability to do it despite the difficult circumstances we find ourselves in.
As always, do not hesitate to contact me if you have any questions, and I will keep you posted in the coming months as I know more.
Best,
Nick
Shutdown (May 2024)
Hi Workstream Investors,
I am writing to let you know that we have made the difficult and unfortunate decision to shut down Workstream Analytics, Inc. We are in the process of an orderly wind down of the business, with the intention of formal dissolution on or around June 15, 2024.
As you can imagine, after all of the hard work and investment that we put into the company and product these four years, this decision was a very hard one.
In this final investor letter, I want to summarize for everyone what we did in the past three months to potentially save or sell the business. I also want to express the most sincere thanks for your support on behalf of myself, our Co-Founder and CTO Chris, and the rest of our team. We only came as far as we did in building the business because of the backing of this group.
Since my last letter, we executed one final product and go-to-market pivot. Unfortunately, despite promising initial results and traction in March with our new Core SKU, our proof points were ultimately not enough to give us the confidence to risk additional capital.
While the majority of my time was focused on saving the business, I also expended substantial efforts, commencing in early Q4 of last year, to sell the business for a non-zero exit. Unfortunately, given our nascent product traction and the macro-environment for tech, none of my M&A conversations gained any meaningful traction.
Please know that we left it all on the field, and left no stone unturned in these efforts. And while I still believe in my bones in our vision for data knowledge and data incident management, our results ultimately show that there is not currently a market here in which we can build a business.
Our final pivot to our (free) Core SKU for incident management
In my last update, I wrote about how we had begun leading with our new data incident management module. We began this transition in Q4 of last year, and entered February with the strategy of a) proving we could drive initial sales of our low priced Team SKU with larger clients, while b) launching a free SKU called Core that would serve as our initial wedge into the market.
While we were optimistic about our chances of selling Team in February, we ended that month without winning any new clients. The rebuttals from prospects were that even larger companies did not yet feel pains around data incident management acutely enough to pilot and then buy a solution.
However, we did have early success in February in getting two new clients to adopt our (free) Core offering. We positioned this SKU as a free solution to provide actionable alerting for data incidents, with basic management functionality meant to streamline a data team’s workflow. Importantly, our Core offering was not only free but only took 5 minutes of initial investment for a team to get value out of. The feedback received was that we delivered on that promise, but it was critical that we deepen our Slack integration.
Knowing that our timeline was extremely tight, we actioned this feedback by quickly building a new Slack integration, and announcing free Slack alerting for data incidents in dbt to the market on March 2nd. And we reasoned that given a more technical buyer, we had to punt on any attempt at monetization short term and just focus on acquiring as many Core clients as possible to prove that this could serve as our initial wedge into the market.
The results in March were promising, as we went from two clients on Core to having onboarded 25 in just under 30 days. In March, we were able to approach dozens of new clients that we had never met before at arm's length, and get them to adopt our Core offering with enthusiasm and excitement. The month of March was clearly a watershed moment for the business, as in that single month we engaged, activated and provided value to more clients than in the history of the business.
Unfortunately, as we entered April we saw that momentum slow – in April, we only onboarded another 5 new clients, bringing our total to 30 YTD. Given our pivot to freemium, we were already in the process of changing our go-to-market strategy from being sales to product/marketing-led. But this quick reversal left us pondering whether this new product offering was truly critical enough to serve as our key wedge into the market.
Accordingly, we ran a survey to all our newly onboarded clients asking them to simply rank the criticality of our product from 1-5, and give us input on our roadmap. (1 = not valuable; 3 = nice to have; 5 = critical). The result was a 3.5 average, with no clients rating us as a 1 or 2 but only a handful giving us a 4 or a 5. Nice to have with a bit of critical upside.
We were left with two realistic takeaways from March and April. First: that any path forward required a bet on driving massive awareness and adoption of our free alerting solution, in what is a very noisy market for data tools. And second: that enough of the market would also see our alerting as a 3+ in criticality, and so they would prioritize adopting, and then eventually buying, a data incident management solution.
The decision to shutdown
We entered April knowing our cash out date was 5/31 unless we had line of sight into an equity financing and felt comfortable burning some of our debt. We engaged in numerous conversations with our lead investors discussing these results and the reality of what we still needed to prove around data incident management.
With these dynamics at play, and the reality that we had already raised $7M, the only viable path was an insider round. That required $2-3M of additional financing led by insiders to prove our Core SKU could be the wedge to acquire 1,000 free clients, and then upgrade 50-100 of them onto Team. And given all the uncertainty with both the criticality and broad applicability of this new offering, we came to the difficult decision that it was better to not put at risk additional capital.
While the majority of my time these past six months has been focused on executing this pivot, I did hedge and spent considerable time engaging potential acquirers where we felt that our offering and team could be a natural fit.
Unfortunately, despite my pressing, I received feedback that given both the market slowdown and nascent state of our business, there wasn’t an urgency for these companies to proceed on the timeline our runway necessitated.
Thank you
We were actively engaged in all of these discussions until last Monday when we decided that, while it is unfortunate and deeply regrettable, shutdown was the only course of action. I stand behind this decision, even if it is a truly bitter pill to swallow after all of our hard work, investment and learnings these past four years.
Logistically, there are no actions for our investors as we do the work to wind the business down in an orderly fashion. But do not hesitate to let me know if you have questions, or would like to talk about the situation in more detail.
Before signing off, I wanted to again express our most sincere thanks and appreciation for your faith in us, and your support and investment these past four years. We feel truly humbled, and wish we had more to report than such a disappointing result.
Best,
Nick
