Monday, May 12, 2008

Xobni's Journey to the Right Product

This is the second of a three-part series on the Xobni launch. Come back on next Monday to check out Part III of the story. Co-written with Marie Baca. An abridged version of this article was featured yesterday on GigaOm.

I often speak with entrepreneurs applying for funding from YCombinator, and when I do I give them this advice: the most important decisions you make are the ones in the beginning of the process. Choices like what product to build and what market to serve determine whether you’re headed for failure or a multi-million dollar exit. Marc Andreessen, founder of Netscape, calls this "product/market fit" and says that it’s the only thing that really matters when it comes to building a company.

It's fair to say that at Xobni, is that we stumbled into product/market fit. We initially built the wrong product, but then we quickly corrected our course.

Building the Wrong Product

When Adam first wrote up our YCombinator application, Xobni was called "EmailDM"—the DM stood for "Data Mining." Adam included demos of how EmailDM would summarize emails, highlight important passages, and so on. Eventually this vision morphed into Xobni Analytics, which lets you analyze email usage by creating a diagram of your message traffic.



The initial plan was to offer this program to companies as a productivity tool. Workers would install the software into Outlook and use the data to find ways to become more productive. We would then offer this product to corporations so managers could remotely monitor employee email productivity.

This Boston Globe article, the first major coverage of Xobni, illustrates why this model was a bad idea: employees would feel like they were being spied upon. But even beyond the spying problem, Xobni Analytics was the wrong product to build for a more important reason: users would install the software, browse it for a bit, and then close it and quickly forget about it. Analytics was not a sticky application that tempted users to come back again and again.

The Xobni sidebar is completely different. There are many features beyond the analytics that add value for the user. Plus, the sidebar sits right next to the inbox, so users are exposed to it for the 2 hours they spend checking their email every day.

Our mistake became even clearer when we shopped early versions of Xobni around to venture capitalists. We first tried to remedy this problem by designing something called Xobni Feeds, which allowed users to create different types of XML queries that we would show up in the sidebar. Only later did we realize that this way too much flexibility for the average user, and we decided that it was a much better idea to show relevant, people-based default information.

In short, we discovered that our product was most successful when it provided focused information about people, not numbers. It is essential that entrepreneurs remember that they are serving an audience of individuals who need simple solutions to their everyday problems.

Why Outlook?

Unlike the initial problems with product development, Xobni made the right decision early on to target the Outlook market. There are an enormous number of Outlook users out there (around 350-400 million, depending on whose numbers you trust), and yet there is also major dissatisfaction with the program.



After Outlook, users most often requested that we build Xobni for Gmail and Apple’s Mail.app. However, both of those clients have much lower pain levels than Outlook. In addition, the addressable market is much more interesting: Outlook users are more likely to have business credit cards so if we ever switch to a freemium model, we can charge them. Also, there’s a strong demand for advertising partnership opportunities within Outlook, an application that users interact with for hours each day.

I like to think of it this way: there are a huge number of Outlook users out there who are so frustrated with the program that they feel like there hair is on fire. What Xobni offers is a cold bucket of water.

A Generalized Architecture

One of Xobni’s major differentiators is that we didn’t build a simple addin for Outlook, but an email application platform. Whenever we write software, we aim for a more general solution than what is required by our current needs. We can easily build new applications and build integrations into other email clients, as these leaked screenshots illustrate.



Building this platform took a significant amount of time and effort, but I’m happy that Adam made this decision early on: It allows us to quickly iterate on functionality, and build new, exciting products in the future!

Choosing a Look

Here are some mockups I created more than a year ago that illustrate the looks we had in mind for Xobni. The mockup on the right was our original choice: it blends nicely into Outlook, almost as if Xobni was built into it from the start. We created the third one almost as a joke, to show how the sidebar would look if we used a funky color palette.



We decided to go with the bright, saturated colors, because it would have what we call the “What the heck is that?” effect. Jane would walk by Jack’s desk, and see a bright blob on the right side of his Outlook screen, and she would blurt out: “What the heck is that?” Jack would have to explain Xobni and what it does, and Jane would probably download it once back at her desk.

Search as an Afterthought

Ironically, Xobni’s search function was initially an afterthought – Greg Duffy implemented it just a few days before we launched our private beta at TechCrunch 40. Even considering the rapid pace at which startups do product development, this was an immense accomplishment: Xobni’s search is twice as fast as Outlook’s, thanks to highly optimized and efficient search indexes. That combination of speed and usefulness make search our top-clicked feature.

Launch!

Let’s say you have a great product. How do you know when you’re ready to launch? That’s what I asked Gmail creator Paul Buchheit two months before our launch date. At the time, Paul was pretty skeptical, but he inspired us with an idea he repeated at Y Combinator's Startup School: Before launching Gmail, Eric Schmidt gave him the assignment to find 100 happy users. After talking to users, and eliminating their top feature requests and bugs, they met that number and thus, Gmail was ready to fly. We followed a similar spirit by adding the Are You Happy box to the product, and by listening closely to customers via our support team and users we knew personally.

We originally launched a private beta at TechCrunch 40, a conference where 40 startups launch their product within 2 days. The schedule was very tight, and the days leading up to it were a chaotic blur. In retrospect, we probably launched a little earlier than we should have. The product hadn’t been heavily tested at that point, yet we grew our user base by 50x that very day. With our open beta launch on Monday, we were finally ready in terms of speed and stability, and the feedback since has been extremely positive:
"Xobni is such a simple idea, but it is sure to radically change how you handle email." - Tom Spring, PC World
"For those who work in the corporate world - where Outlook is still heavily used - Xobni's public beta will be of great help, allowing them to quickly find and expose the data trapped in their inbox." - Sarah Perez, Read Write Web
"This plugin looks like it would be insanely helpful. Gmail, are you paying attention? :)" - Comment by Ross M, Lifehacker
"Given that Outlook is pretty much de rigueur for most corporate e-mail systems, this should be a welcome addition for those of you trapped in Outlook at work." - Scott Gilbertson, Wired
"Oh Microsoft, you’ve missed the boat yet again it would seem." - Zach Epstein, The Boy Genius Report
"In just a short few days, I can already share my belief that Xobni is a must download for Outlook users." - Kevin Tofel, kjOnTheRun
"Designed to make it easier to handle the deluge of daily messages, Xobni integrates with Outlook and - to quote our original review - becomes an invaluable weapon in the daily war with email." - Tim Danton, PC Pro

Thanks to Evan Solomon and Sean Ellis for reviewing drafts of this article. Be sure to check out Part III of this series, where I’ll talk about how we built a great company, assembled a superstar team, and built a culture that encourages building solid products.

Further Reading

If you enjoyed this post, be sure to check out my earlier blog entry, The Days before the Xobni Launch which talks about the days before launching our private beta at TechCrunch 40.

If you haven’t done so yet, read the first part of the series "Hello World, Meet Xobni".

3 comments:

Prakash S said...

Where did you get the data for the slide that outlines the number of users for outlook, yahoo mail, hotmail, etc?

Are those all users or currently active users?

Thanks,
Prakash S

Gabor said...

Prakash - it was mostly Wikipedia, Radicati Group, etc.

For example, the Yahoo Mail number comes from here.

Sorry I didn't list all the sources, but these number are mostly just estimates anyway.

Prakash S said...

No worries about the source, Gabor! I see different numbers from difference sources and hence the question :-)

Prakash S