Welcome to Beyond the Build, a new series from Shopify where we share stories behind the Shopify ecosystem. A platform where founders, developers and innovators come to build for millions of merchants worldwide. Host Fatima Yusuf sits down with top Shopify app founders whose technologies have impacted tens of thousands of merchants to uncover what it takes to build, grow, and scale an app on Shopify.
In this episode, Fatima chats with Ben Jabbawy, the founder and CEO of Privy. Privy is a leader in ecommerce marketing for small businesses and entrepreneurs. Their mission is to provide the tools, education and support small ecommerce brands need to grow their online stores and build thriving businesses. Privy is used by over 400,000 merchants in 180 countries and has driven over $4 billion in sales.
In this interview, Jabbawy shares how Privy’s shift to an ecommerce marketplace distribution model, and dedication to the customer experience led to exponential growth in app installs.
Watch the interview below, or read on for the full transcript.
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Starting with a passion for supporting small business
Fatima: Ben, in the industry you're super well known. Tell me, what was the beginning of your journey? Where did this start? How did you start building apps?
Ben: My excitement around small business first started from childhood. Both my sets of grandparents ran small businesses. My dad had a business, my mom had a business. Growing up in that house, that was all that I knew. I was also technical. I'm not a developer, but I did study engineering. For me, it was, build an email campaign, build a website, what's Facebook ads, all of that stuff. That was the foundation. After school, I was involved with a family friend who was launching a company. I learned what that process was like. That was really exciting to me and gave me some confidence to test ideas of my own.
With a friend—this is long before Privy—we launched an iPhone app. It was called G-Push. It's funny to think about it, but at the time it was a total band-aid solution. We were probably one of the first 100,000 apps in the iPhone App Store so we learned a lot and mostly just built up the confidence to figure out how to execute on ideas.
Fatima: One of the first 100,000 apps in the iPhone App Store. What was your experience building an app for iOS and what made you decide to move from building for iOS to building a commerce app?
Ben: It was amazing back in 2009 or 2010. It was like the Wild West in a lot of ways, but it was amazing that with a friend we could just build something over a weekend, submit it, and get it approved, which took some back and forth. But then once it was approved, instantly people were downloading this thing and using it. We learned a lot. We got to 100,000 downloads and the servers broke. Then the competitors came up. It wasn't really a long-term business but I look back at that experience and say, “Wow.” It was a pivotal moment in my career where I was able to build up some confidence to execute on ideas.
Long-term, I wanted to go back to that idea of solving problems for the types of people that I really understood, which was small businesses, due to my parents. I saw them and their appetite for adopting self-serve technology, especially as it related to marketing. That was a theme that I was really excited about. It's something that I really understood, and it took me a while to figure out what ecommerce really was, even after launching Privy. We actually started serving brick-and-mortar businesses originally—which had its own set of challenges—before we found and built the app for Shopify.
Fatima: When we were chatting last time, you mentioned something about the dinner table stories that stuck with you. Were you referring to your folks being small business owners?
Ben: Oh, totally. My dad's an immigrant to the U.S. He's from Iraq. I have two brothers and we'd sit around the dinner table and he'd be like, "You have to take risks, boys. You have to take risks. This is what it's all about," which was so interesting because I don't think that's like, normal dinner table talk, but it's something that stuck with me for sure. I didn't quite understand how that would manifest itself for me or my brothers, but it was an amazing lesson to have someone always encouraging us to try things.
Fatima Yusuf: It’s interesting and I can relate because, growing up as a child of immigrants, you're typically told one of two things: You’re told either to take risks, or to go for the steady, stable job that will give you an easier life.
Ben: Totally. Actually, even from my dad, it flip-flopped quite a bit. He’d say, "Oh, after college you go to grad school, you’ve got to get a master's [degree]." Like, you’ve got to do something, but on the other side of the coin, he's like, take risks. It was just kind of funny.
Discovering the Shopify App Store: Privy’s best business decision
Fatima: So you started out working with brick and mortar retailers. What happened in that experience that made you think you should really focus on online businesses?
Ben: We actually had our backs against the wall in the beginning. We got to $100,000 in revenue and we were pretty flat for a while. Finding distribution that helped us acquire brick-and-mortar businesses was really tough. I was going door to door, walking down main street, cold calling, cold emailing, all of that stuff. We were actually about to shut down the business. We were running out of money. The original team was having kids, and getting married, and people were like, "Where's this going?" But in the back of my mind I just felt like we hadn't really given it a good shot around distribution.
We got lucky in that one of our brick-and-mortar businesses happened to sell online. I called that customer to say, yeah, we're having a tough time, but she said: “You can't shut down Privy. This is the greatest thing I've ever used. Here's why.”
Then she started to tell me about her online store, how valuable promotions and coupons were, how email was the way that she derived the majority of her revenue, and how her email provider just didn't give her a great way to grow her email list.
She was just like, “I can't do this without Privy. This is the greatest marketing software I've used.”
So that was a huge moment for me. I was like, “Tell me more about ecommerce.”
What I learned was, for the majority of ecommerce businesses, the worlds of online stores and brick and mortar were melding together again.
At the time as an ecommerce store, she was just sitting in a room trying to figure out how to grow a business. I thought that was really interesting. That's what kind of got me originally looking around, like we built integrations with everyone, BigCommerce, X-Cart, like everyone.
Then I started hearing about Shopify. I was like, “Oh, whoa, we have to check this out.”
We had other integrations before we built Shopify, believe it or not. That was when we realized, okay, ecommerce is where we have to focus. Then we found the APIs in the Shopify App Store and that was really the moment that changed the entire trajectory of our business.
"That was when we realized, okay, ecommerce is where we have to focus. Then we found the APIs in the Shopify App Store and that was really the moment that changed the entire trajectory of our business."
Fatima: What did that look like? You entered the Shopify App Store, and when was the moment where you realized your trajectory was changing?
Ben: I remember vividly sitting in the office, we had an office back then. It was late at night. In a single day, we had gotten five installs. Then the next day it was like, 15 installs. When I think back to how hard it was in my cold calling and walking down main street days to try to get brick and mortars on board, and then all of a sudden we're getting installs based on this integration with Shopify. I started to get the chills. For so long it was so hard. It probably took a year to get that many customers in our old model. And now overnight, just by getting approved in the [Shopify] App Store, we had that coming in. It was amazing.
"Now we're at a point where we're actually seeing over 12,000 installs a month from Shopify alone."
I think about the chapters of Privy in terms of our monthly install count. What ended up happening was, we were flat forever. We entered Shopify and the first month was probably like 50 installs, then it doubled the next month to 100, and then 200, and then 400, and then 800. Now we're at a point where we're actually seeing over 12,000 installs a month from Shopify alone. I can literally think back to that moment where I said, “Wow, this is actually possible.”
Fatima: We take it for granted now because the Shopify App Store has grown so much, but prior to Shopify it was a painful process to put software in the hands of a retailer or merchant—there was so much friction. Now there’s this frictionless way of integrating with your customers around the world.
Ben: I remember the days where I used to have to figure out for our customers how to instruct them to copy and paste some code from Privy and put it somewhere on their website. The fact that you don't have to do that anymore is huge.
Fatima: That's awesome. Also, I think what's so interesting, Ben, is it sounds like from the beginning you've been really focused on SMBs. How intentional of a decision has that been?
Ben: It's very intentional. This is something we talk about a lot in our senior leadership team at Privy now. It’s something we talk about at the individual contributor level at all hands meetings, this is who we are. And the ecosystem has evolved. It's always very exhilarating, the idea of some massive brand adopting your software or your app.
"The energy and the impact that we can have on the livelihoods of an entrepreneur, that's where I get my energy. Our entire mission as a company is to help these entrepreneurs grow."
For us, given my background and my DNA, and also now that we've grown as a company (we're now 70 people), the DNA of where these people are coming from, and the mission and what gets them excited, this is what gets us out of bed. The energy and the impact that we can have on the livelihoods of an entrepreneur, that's where I get my energy. Our entire mission as a company is to help these entrepreneurs grow.
The distribution model that changed everything for Privy
Fatima: Talk to us a little bit about your funding journey. I know you guys recently closed a round. Tell us about what that process was like and how it relates to the first time that you decided to raise money.
Ben: Oh my gosh. I've learned a lot about fundraising over the years. Initially we had to fundraise because there was no path to distribution. There was no path to getting customers without banging on doors. Once we found our footing in the Shopify ecosystem and our distribution model, that all changed.
"Initially we had to fundraise because there was no path to distribution. There was no path to getting customers without banging on doors. Once we found our footing in the Shopify ecosystem and our distribution model, that all changed."
There was a period of time for a long time where we didn't need capital. I actually think today, depending on the nature of your team or yourself, if you're a developer yourself, you don't need capital. You can build an amazing solution that adds value, you can submit it to the [Shopify] App Store, and you're going to get downloads.
Fatima: And create a totally profitable business without taking capital if you didn't want to.
Ben: Totally. Which is the dream. For us, as we started to see some pretty serious growth because of our model, which was supporting small businesses, the free plan, driving value quickly without having to talk to us and even offering live chat. Those were some of the things that worked for us. Because of that, a lot of our Shopify customers specifically started to ask us for more functionality inside of Privy. They liked how it was easy to use, they liked the support model. Why can't we do more here?
That was a moment where, at the time there were 10 of us, we turned around to each other and we said, wow, because of this distribution model we have a once-in-a-lifetime opportunity to build a global brand. Our path to doing that was accelerating our product development, and that was when I said, despite hearing 1,000 nos—and that's not really an exaggeration from investors prior—I want to get back out there.
When you have distribution, when you have customers, when you've got stores actively using your software, if you decide that you need capital for your business, that's the time to go talk to investors. It's 2021 and there's a lot of investment happening in this space right now, that wasn't the case back when we were raising. Even that process now is a lot easier given Shopify's growth and the growth of this ecosystem.
Fatima: You guys are in this great situation right now. I love your focus on your customer base. You recently locked in some funding. What's next for Privy? What are you really excited about in this next chapter?
Ben: We've barely scratched the surface. Today we have over 100,000 active Shopify stores, which is amazing to think about. We've expanded our platform over the years especially with our focus on small business. We feel like that's a niche that we can carve out, that we can own, and we can continue to solve so many problems on top of Shopify for that merchant. Merchants need to answer three questions. How do you drive traffic to your store? How do you convert first-time purchasers and how do you drive repeat sales? Privy has done a great job of answering two of those three questions and we still have a lot of opportunity in front of us to solve all of it.
Why every founder should be speaking directly to customers
Fatima: What are some of the biggest lessons you've learned or opportunities to fail forward that you’ve experienced? Can you walk us through some bets you made that worked out, and maybe some that didn’t?
Ben: Yeah. Early days, within the Shopify ecosystem the most important thing when you're building an app is to let the merchant find value quickly. The sooner you can do that, the more success you're going to see. Value can be, oh, maybe it's driving a sale, maybe it's simplifying fulfillment, maybe it's simplifying selling internationally or something like that. There's so many ways that you can add value, but the sooner you can help your merchants who install your app recognize that moment, the better.
A huge part of what value means to merchants, certainly inside the Shopify App Store, is support. Don't lose sight of that. Creating amazing support experience for your merchant is going to help you get more installs, because merchants talk to each other. There's peer groups online and word of mouth is huge.
"Sometimes a lot of developers get excited about building software, but you need to be equally excited about creating an amazing experience that drives real value for the merchants."
Sometimes a lot of developers get excited about building software, but you need to be equally excited about creating an amazing experience that drives real value for the merchants. That was something that took me a little while to realize, especially when I was going door-to-door. That was an afterthought. I was so focused on how to get customers and get businesses using our software.
Then when it switched and I finally found an acquisition channel that was driving merchants to adopt Privy, I was like, “Oh my God, I just spent two years trying to get people to talk to me. Now, they're in our live chat, I'm going to talk to every single customer that wants to talk to us.”
"I would say to anyone thinking about building an app, make sure that talking to your customers is something that gets you excited."
That was huge. That's a big part of our growth story. I would say to anyone thinking about building an app, make sure that talking to your customers is something that gets you excited. Other stuff too. There's so much opportunity in the [Shopify] App Store. In the early days of a new developer entering the ecosystem, what I would say is to focus on something small. Try to find your wedge around a problem that merchants have. If you can be the absolute best at that one thing, I guarantee that you can expand from there to do more. That was also something originally if you looked at Privy's listing in the [Shopify] App Store in 2016 when we first started, it was about growing your email list. Now if you look at Privy's listing in the [Shopify] App Store it's about all the tools you need to get to 1 million in sales.
Over the years we've expanded. We did try some product expansion early on, and it was too early, we were too small a team, we were spread thin, and that product failed and we shut it down. That's fine. You have to try stuff and experiment. Not enough people understand how big this opportunity is within commerce. If you can carve out an opportunity for yourself to be known as the absolute best at one thing, then there's plenty more opportunity for you after that.
"Not enough people understand how big this opportunity is within commerce. If you can carve out an opportunity for yourself to be known as the absolute best at one thing, then there's plenty more opportunity for you after that."
Fatima: I see it almost like a matrix. You’ve got merchants you can segment based on geography, product type, their size or scale, etc. They all have different needs, whether it's marketing automation, shipping solutions, customer support, and more. But I think people often underestimate how big each of those matrix points are as a market on its own.
Ben: Totally. I talk a lot about the parallels between what happened in the Salesforce ecosystem 10 years ago, to what's happening inside of Shopify now. About 10 years ago there was HubSpot, Marketo, Eloqua, Pardot, and there was Act-On.
Early on, people probably looked at that and said, there's already players here, what are you doing? But each of those companies grew alongside that ecosystem and carved out their segment and grew up to be $1 billion plus businesses. That same opportunity exists within Shopify. If you're a developer and you're looking at a category, when you think you have an angle to solve a small problem differently than the existing players, go for it. Each of these categories and opportunities has plenty of room for five to 10 huge players. We're not there yet.
"If you're a developer and you're looking at a category, when you think you have an angle to solve a small problem differently than the existing players, go for it. Each of these categories and opportunities has plenty of room for five to 10 huge players."
Build for your international users with these simple additions
Fatima: For Privy itself, would you mind telling us a little bit about any international expansion efforts? Your customer base today, are they in North America? How are you thinking about new markets?
Ben: Two years ago I was looking at our user analytics and I was like, whoa, we're getting reviews in different languages. We got people logging into the Privy dashboard from almost every country. We were just like, what's going on? We realized—and this is still the case today—that over 60 percent of our customer base is outside North America.
Fatima: Over 60 percent of your customer base is outside North America?
Ben: Yeah, it's wild. Originally that was what you'd expect. It was English speaking countries, Australia, UK, etc. Over the last couple of years, I think because of the [Shopify] App Store if I’m being honest, and the growth Shopify is having internationally, we started to see other pockets of growth. For us, we saw [growth in] French- and Spanish-speaking countries [and regions] like France, Spain, South America, Central America, Mexico, and Brazil. We made a lot of investments under the hood and the Privy dashboard is now available in three more languages, so four total. English, French, Spanish, and Portuguese. We've seen those languages grow really quickly for us, alongside with our international presence. We do look at that as a big opportunity for us.
"If I'm being honest, because of the Shopify App Store and Shopify's international growth, we started to see other pockets of international growth."
Fatima: That's awesome. Given that 60 percent of your customer base is outside North America, and obviously a big slice of that is non-English-speaking, what are some of the lessons you've learned through that expansion in terms of entering markets, different cultures, and [more] languages?
Ben: The cool thing is you can translate the dashboard experience. You can translate a couple of your help docs—the most popular ones—and you can translate your [Shopify] App Store listing. Just by doing that, you're going to have a leg up in terms of growth inside the Shopify App Store.
Imagine you don't speak English and you're looking at the [Shopify] App Store, and there's a listing in your language, that's amazing. We also realized we need to be offering support in those languages too. It's forced some really great puzzle pieces and challenges. For example, as a company of 70 US-based employees, how do we figure out how to offer the same level of support that we're known for, for customers who are buying our product or using our product in other languages?
Step one is to translate the dashboard experience, get the listing ready and some of the most popular docs, and then you'll see downloads through the [Shopify] App Store.
Step two, which we haven't even tried to tackle yet, is how do you do international marketing and sales? We still have a lot to learn on the international expansion side, but it's been going well for us.
Fatima: I love your focus on support because I couldn't agree more that it's a big part of the secret sauce. That's really where your customers are giving you your feedback on the product, but also that's how they know that you're there for them. And I think it's just such an important part of any product business.
Ben: As a developer in this ecosystem, you need to remember that this is a merchant who's passionate about bringing their product or service to the world, and that's why they're using Shopify. They don't typically know a lot about technology. When they go to the [Shopify] App Store to look for something, they've got a problem and they're looking for a solution. The support experience and how you coach your merchant through adopting and seeing value out of your product, that should be equally weighted in value to the software that you write.
"When merchants go to the Shopify App Store to look for something, they've got a problem and they're looking for a solution."
Fatima: I 100 percent agree. Ultimately the point of Shopify and more broadly the ecosystem in aggregate is to simplify that entire thing for the merchant so they never have to really consider the technology that much. They can focus on building their brand, selling their product and we collectively take care of the rest by creating that frictionless entrepreneurship journey.
Ben: Exactly. From the developer standpoint, we all need to recognize that this is what Shopify does best. You guys remove complexity for the merchant around some really complex concepts. The same expectation is there when a merchant is downloading an app.
Fatima: Totally. Thank you so much, Ben. Before we head off, do you have any wisdom for the aspiring entrepreneurs of the world who are just starting out their journey?
Ben: Yeah. Talk to your customers every day, offer incredible support, and when you've got a customer that's incredibly angry, swearing at you, lean into it, offer an incredible experience. They're doing that because they're incredibly passionate about finding a solution to the problem that you solve. You're going to learn a lot and you'll turn them first into a lover, and then into someone that's going to spread word about your app.
"Talk to your customers every day, offer incredible support, and when you've got a customer that's incredibly angry, swearing at you, lean into it, offer an incredible experience."
Fatima: I love it. Thank you so much, Ben. I really appreciate you taking the time to come on and share your journey.