SaaS Pricing: Zero Revenue From One Costly Mistake

Omer Khan (0:09)

Welcome to another episode of The SaaS Podcast. I'm your host, Omar Khan, and this is a show where I interview proven founders and industry experts who share their stories, strategies and insights to help you build, launch and grow your SaaS business. In this episode, I took to Ryan Wang, the co-founder and CEO of Assembled, an AI platform for customer support that helps companies manage both human and AI agents more efficiently. In 2016, Ryan Wang was a machine learning engineer at Stripe. He and his future co-founder, Brian Wang, built machine learning tools to automate support tickets. But they realized the real problem wasn't automation, it was workforce management. And that became the spark for Assembled. The two of them, along with Ryan Wang's brother John Wang, spent two years building before they launched in 2020 They lined up a TechCrunch story, hit the front page of Hacker News, and then they launched and landed the same day the World Health Organization declared COVID a global pandemic. Momentum vanished, about a quarter of demos didn't show up, and it took them eight months to earn their first dollar of revenue. When they finally got customers, they had usage-based pricing with no minimums, so customers could scale usage to zero. And when usage flatlined during the pandemic, the team blamed themselves before realizing customers weren't leaving because of the product, they were just cutting costs. So they shifted their focus. Instead of chasing growth, they focused on the customers who were getting value and kept building around them. They met customers in person, sat with support leaders, and built what actually mattered. And that hands-on approach worked for about the first 10 customers. Then it broke at 50 Onboarding took weeks. Some features worked in demos but failed in production. So they rebuilt onboarding to get it down to days and cleaned up the product so it could scale. Today, Assembled is an 8-figure ARR company with about 120 people, serves several hundred customers, and has raised $71 million. In this episode, you'll learn how Ryan knew he had a real business when he discovered that Stripe, Casper, and Grammarly had all built similar color-coded spreadsheets. What Ryan learned the hard way about usage-based pricing with no minimums and how they fixed it. How Ryan's team decided which early deals requiring custom work would help them grow versus becoming distractions. We talk about why Assembled focused on one Slack community instead of trying to be everywhere at once and why that worked. And the simple method Ryan used to create a very detailed ICP by looking at patterns in customers he already had. So I hope you enjoy it. I talked to a lot of founders stuck in the same spot. They've got a clear vision. They just need the right team to build or scale it. That's where Gearheart comes in. They're an AI powered product development studio that handles the entire technical side of building your B2B SaaS platform or AI agent. Built by serial entrepreneurs, they understand the unique challenges of startups and can plug into your team to accelerate growth. They've built over 70 successful products, including Smart Suite, which raised $38 million and is used by companies like Capital One. Right now they're offering our listeners the first 20 hours of development for free. Just book a call at gearheart.io. That's gearheart.io. Your company's credentials could be on the dark web right now, and you wouldn't even know until it's too late. Nordsteller detects threats before they escalate. It monitors the dark web for leaked credentials, tracks your attack surface, and protects your brand from impersonation. Built by the team behind NordVPN. Don't wait until your data is for sale on the dark web. Book a demo and mention Black Friday 20 for 20% off at sasclub.io/nord. That's sasclub.io/nord.

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Brian, welcome to the show.

Ryan Wang (4:52)

Thanks for having me.

Omer Khan (4:53)

It's my pleasure. Do you have a favorite quote, something that inspires or motivates you?

Ryan Wang (4:58)

Yeah, I love this and I gave this in all hands recently, this Robert Louis Stevenson quote. I have it in a doc next to Michael Jordan one. It's, don't judge each day by the harvest you reap, but by the seeds that you sow. And it was the start of fall when we did this all hands, so it felt particularly apt. But I do think as well, it's one in which, you always look at today like, ah, did we hit this milestone, did we hit this goal? What amazing things happened, or what terrible things happened on the other end? But it's really all downstream of things that you were doing a month ago or a quarter ago, a year ago, a lifetime ago.