STATION F’s first Ask Me Anything session with the co-founders of Zenly
We are starting out STATION F’s very first week of events with a startup very dear to us: Zenly. Recently acquired by Snapchat, the 40-person geolocation company has gone through a true startup roller-coaster. Now it’s the only app that can locate you and your friends real time and with low battery usage, and it’s got millions of daily active users.
Yesterday, Zenly’s co-founders Alexis Bonillo and Antoine Martin were both on stage at STATION F and took part in our monthly Ask Me Anything session. Here are the key lessons learned from one hour of questions and answers by the two founders.
DON’T: hide your product and be scared to share your ideas
Zenly was created in 2011. At the time, the vision was already the same for the co-founders: people need to share their location real time — yet the market wasn’t ready and people were reluctant to share their location. They decided to focus on the “family” market and created AlertUs — basically you would use it in case of a problem to warn your family about your whereabouts.
Zenly’s co-founders’ first biggest mistake was not to share about their activity with other entrepreneurs and experts. They would focus on building this product that had no real future and struggled with user retention as their app would consume a lot of battery, and wait for a “perfect” version of their app to be released instead of going step by step.
The battery issue took almost two years of R&D to be solved (although the team thought it would take less than a month). They then decided to launch a minimalist version of their “low-battery consumption” app on the App Store, just to see how the tech would be perceived, not as a consumer product.
Funny enough, it was an instant success: they then decided to switch to a consumer-app business, based on the traction they got.
“Always remember this very famous saying: idea is 1%, execution is 99%. Don’t be scared to have your idea stolen. If you’re the most focused, you’ll win.” -Alexis Bonillo, cofounder
Launching a geolocation app in 2011 VS in 2017
Zenly was lucky to grow with their market: back in 2011, people were simply reluctant to share their location with their friends. But as Zenly’s technology matured, so did consumers’ habits: Foursquare launched Swarm, Uber launched a location-sharing feature. Thanks to those, the market evangelized their own use-case. Even Zenly’s team was surprised by how easily their friends would use their app
“I didn’t expect my girlfriend to be ok with sharing her location with me!” -Antoine Martin, cofounder
Rule number 1: your app = your users’ needs
Zenly answers a very basic need: locate your friends. If you analyze people’s texts, you will see that most data is about where you are, how to find you, join you. Zenly just makes it easier.
So what about all the other cool features that you find in Zenly? Were they a game-changer about the crazy virality that the app went through? The co-founders’ answer is very clear: every new feature is about making your users “true” users, have them truly engaged into your app, not about making your app more viral.
The best example: the messaging feature. With messaging, your friends bring you back to the conversation. No need to add constant notifications.
On an interesting side-note: Zenly took off like crazy in Asia! Adoption and engagement was high in South Korea (mostly with families) from when the beta was launched. But Japan is the leading Asian market in terms of active users. Indonesia is also very strong. Yet the founders have no scientific explanation for that! Any ideas?
Growing a team twofold by using “Squads”
Zenly’s team is 40 people today, 90% engineers, 5% product and the rest: marketing and operations.
At the very beginning, they worked with a lot of freelancers, paid above the average to get the best, thanks to the money they raised from B.As. The first engineers they worked with were characterized with a “hacker” mindset. Once the company grew, they needed engineers that were capable of scaling the technology: most of the time, these are different people!
“You need to scale your company faster than the learning curve of the best engineers” -Antoine Martin, cofounder
The biggest change in the team occurred when they went from 18 to 30 people — seems like small numbers, but the difference was huge. With 18 people, everything can be done orally, at 30, you need processes.
Alexis and Antoine implemented “squads” (a method widely used by Spotify — see their blog). Instead of having groups of Marketing, Ops, etc, they group people by tasks and projects (for instance “Group chat”) creating small startups inside the startup. This method creates velocity, ownership, each squad becomes more specialized, and it creates less silos.
The co-founders shared that their HR strategy hasn’t been perfect. A common mistake founders make is to refuse to hire and Office Manager with a 10-person team. Zenly’s advice: consider hiring someone right away so that you don’t focus and lose time on admin tasks.
“We never tried to raise funds.”
Zenly raised two rounds of funding (after being funded by business angels, notably Olivier Thomas), one of $11.2 million and in September 2016, $22.5 million with Benchmark’s Peter Fenton. The story — that kind of sounds like a startup movie (The Social Network 2?) — started a while back, when they launched their beta version.
At 6am in the morning, right after the app appeared on the app store, the co-founders received an email from Jean de la Rochebrochard, who was a fundraising advisor at the time (he is now running Kima Ventures), just giving some friendly advice. Ever since, he became a very strong supporter of the app and helped intro with all the investors
In July 2015, after several contact requests from investors, they almost raised funds with a UK VC firm (who emailed them: “You’ll get a term sheet in 2hours”… which never came — so… never trust emails, only trust the money!).
Cash was literally running out and the co-founders had to negotiate a bank’s credit line base on investment offers they got from VCs — with no guarantee it would actually take place!
At the end of November, they ended up raising their first round with Xavier Niel (see the connection with Jean?) and IDinvest as co-leads. Just in time when they had €0 left in the bank.
The story of the second round of funding contains a trip to the U.S, a party with Uber’s co-founder Garett Camp, Airbnb’s CEO and Lance Armstrong. But we won’t give you the details, that remains between Lance, Alexis and Antoine (Lance did not invest, by the way).
Long story short: once again, they didn’t want to raise funds. But following an introduction by Solomon Hykes (Docker’s co-founder and member of STATION F’s selection board) to Jerry Murdock, the latter convinced them to meet with Peter Fenton. After several invitations, Antoine missed Calvi on the Rocks’ music festival to go to the U.S along with Alexis. They met with Benchmark’s partners and then… went to dinner with them. “This is when the tough questions started. Especially since we did not sleep and were completely jet-lagged” told Antoine. When you receive a deal from Peter Fenton and that it’s 15% higher than what he already promised orally, you can’t say no!
Now up to the next step of their adventure: being part of Snap! Hope to see Alexis and Antoine back in a few months so that they can share this story.
Is there someone you’d like to see speak at STATION F? Tell us in the comments!