Zapier’s CEO Wade Foster offered new employees $10K to move out of the Bay Area. This, after building one of the stickiest startups in Silicon Valley.
That’s because Zapier now supports 60,000+ paying customers, and the free user count is now in the millions. Tying it all together is a fully remote workforce of over 120 employees working across 15 countries.
So how did Zapier go from a freelancing side project to what some people describe as “the Internet’s new glue?”
I spoke with CEO Wade Foster to find out more about the motivations behind the Bay Area bail-out, the strangest apps people have created with his product (hello Seinfeld and Kanye), and the things that keep a startup CEO awake at night.
From side project to big business
EJ: Let’s start at the beginning. Where did the idea for Zapier come from?
WADE: Zapier spun out of freelance work that Bryan and I were doing in Columbia, Missouri. We were just the local Internet folks—if it required the Internet, we’d say “Hey, we can help with that.”
Then Bryan realized we were getting a lot of integration work—like sending WordPress forms into Salesforce, PayPal sales into QuickBooks, that sort of stuff.
So he pitched me: we can build off-the-shelf software so that people can automate the movement of data between these common apps, without shelling out so much money.
EJ: You’ve described your early marketing efforts as “brute force.” What marketing strategies did you experiment with early on, or what should you have experimented with?
WADE: One of the cool things that startups can do that big companies can’t is to go fishing in small ponds.
There are little channels that a big company would never waste their time on, because it doesn’t have meaningful impact. But small companies can get in there, and it actually does move the needle.
So we hung around forums—like Evernote, Dropbox, and Highrise forums—and listened to complaints. Someone would ask, “Why doesn’t this app have an integration with this?” And we’d say, “Hey, you can use the API to build this stuff, and we can help you out.”
Each time we did this, we’d get a few new beta customers. And that’s exactly what we needed in the early days.
“We just needed a couple folks to give us a shot.”
EJ: When did you start getting inbound interest from companies that wanted you to integrate with them?
WADE: It took us probably eight months of proactively reaching out to customers before we got our first inbound request, someone asking “Hey, how do I get my app on Zapier?”
EJ: Did you ever imagine you’d end up where you are today?
WADE: Not at all. Our ambition started out fairly modest. We just wanted to create a place where we could work full time, where we could be our own boss, where we could pay the bills for us and our families.
As we got into it, we saw that we were tackling a bigger problem, and we realized we had a chance to do something pretty special. But that came later.
Can Midwest values map a startup?
EJ: You grew up in Missouri, which is way different than the Bay Area. Do you think that growing up in the Midwest had any effect on your values or how you run your business?
WADE: Absolutely. In the Midwest, fundraising isn’t really a thing for a small business. You can’t be a smart engineer, walk out of the door, and get $100,000 or $200,000 in seed funding.
“From the get-go, we were thinking about how to build a sustainable business, not just how to build an app or a product.”
All three of us also bring a strong work ethic. There’s a “pull yourself up by your own bootstraps” mentality inside of Zapier.
So this wasn’t something that we felt would happen overnight, we knew we were going to have to work at it. And even to this day, we have a “one foot in front of the other” approach to growing the business.
The million-dollar pricing model: from paid to freemium
EJ: Zapier started out with a paid subscription model, but then later switched to freemium. Why did you make the switch?
WADE: The early product was rough around the edges. It was tough for people to use. So with a paid model, we got folks that cared—it proved we were building something worthwhile. And it allowed us to spend time with those customers, to make sure that they were successful, and we used their learnings to improve the product.
Once we felt like the product was polished enough—where a free user could sign up and didn’t need support to be successful—we opened it up as a freemium model.
We wanted people to be able to play, because the beauty of Zapier happens when you get in there and see what you can make. And one way to reduce friction is to not require a credit card out the gate.
Building a product that steps on it’s own
EJ: Were there any other make-or-break points along the way that altered the course of Zapier, for better or for worse?
WADE: One of our biggest changes was when we launched Multi-Step Zaps in 2016. Before, you had a single trigger and a single action: when something happens in this app, do this other thing in this other app. Multi-Step Zaps allowed you to do this thing in this app, and then do another thing, and do another thing.
“Gut instinct said it was a great idea. But we were afraid of the complexity it would add.”
The beauty of Zapier is that it’s easy to understand. So we were really worried about making the product more difficult. We iterated on three or four different designs, and we eventually stumbled on a model that worked well in our beta and usability testing.
Being able to chain things along like this allows people to expand their creativity in Zapier immensely.
EJ: What’s the coolest workflow that you’ve seen snapped together with Zapier?
WADE: There’s a really fun example from this fellow in Australia. He’s made two apps: one called Seinfeld Text, and one called Kanye text.
He has a pricing page powered by Stripe. You pick your plan, put in your friend’s phone number, and then every day it sends them a new Seinfeld quote or Kanye text. It’s mostly Twilio, Google Sheets, and Stripe that powers the whole thing, which is pretty impressive.
That’s a fun example, but there are more serious examples.
Someone using a sophisticated typeform on their site takes survey respondent data, runs it through Clearbit, spins up a Zoom meeting invite, adds the data into MailChimp and Salesforce, and then sends out a Slack notification to a sales rep saying, “You need to follow up right away.” And then it also sends a confirmation email to the person who filled out the typeform saying, “We got your information.”
So creativity is really the only thing holding you back. Zapier can act as this magical routing machine that gets your the data to all the right places, allowing your business to take the right steps at the right time.
EJ: Looking forward, do you have your eyes on the next big feature or product change?
WADE: We do have some big stuff up our sleeves, but I don’t want to spoil the surprise.
When do remote teams stop working?
EJ: Zapier is well-known for being a fully remote team. How do you make it work with 120 employees scattered around the world? Ever feel like you need to start centralizing some teams or processes?
WADE: It’s in our DNA to work this way. Bryan, Mike, and I started working on this project through chat, pull requests, and Trello cards. So we figured out a way to make remote work, and it makes sense to us.
“Scaling challenges aren’t about working in an office or not—it’s just part of a growing company.”
Office companies face this problem too. You add more people, you have a bigger office, and communication breaks down. Your response to that isn’t, “Hey, we’re working in an office. We need to go remote to fix this.” No, your response is, “There’s something wrong with our communication structure. There’s something more fundamental that we need to fix here.”
And that’s how I think about remote versus in an office—that’s treating a symptom and not necessarily digging in at the core issue that you have.
EJ: To promote your remote-working business culture, you offered employees $10,000 to leave San Francisco. What’s this all about?
WADE: We noticed two times where someone living in the Bay Area applied for a job at Zapier, got hired, and within a few months they left the Bay. And in both cases, they moved back home to be near family and friends. And they were both raising families with children. That’s one of the appeals of Zapier: you don’t have to be tied to the Bay Area.
“You don’t have to make a choice between your career and your family.”
So that’s really what the de-location package was about. We’re saying that you can have a great job, and you can take care of your family at the same time. It doesn’t have to be a trade-off. EJ: But you choose to stay in the Bay. Why is that?
WADE: The Bay Area, with all its faults, is a great place to live. The weather is amazing, there’s a lot of stuff to do, there are smart, talented people all around. Zapier also has a lot of partnerships here in the Bay Area.
My wife and I could choose to live and work wherever we wanted. We’ve thought about it, we just haven’t pulled the trigger yet. But it’s always an option for us, which is great.
But seriously, who is Wade Foster?
EJ: Hopping outside of your Zapier shoes, how would you describe yourself?
WADE: It’s tough to pull my brain away from Zapier and the work. But there are two things that help: hanging out with my wife and my dog. And I play a lot of racquetball, which gets my mind away from work too.
EJ: What kind of dog do you have?
WADE: We have a little Maltipoo. It gets me out on walks.
EJ: Zapier disappears. What would you do?
WADE: Oh goodness, I don’t even know. I’d probably go back to Missouri and go fishing, like a month of soul searching to find myself.
EJ: You met cofounder Bryan playing in a jazz quartet. What instrument do you play?
WADE: Yeah, we played in a jazz and blues quartet together. Bryan plays the bass and the guitar, and I play the saxophone.
EJ: Do you have a favorite vacation or getaway spot?
WADE: Last vacation, we took a short hop down to San Diego for an extended weekend, and that was a lot of fun. We tend to do a lot of shorter day trips around the West Coast, which are a little less time consuming.
EJ: Mountains or a beach?
WADE: I can do both. I can be lazy on a beach and read a book, or I can go hike a mountain.
EJ: iPhone or Android?
WADE: I have the latest Google Pixel, so I’m sporting an Android device right now.
EJ: Are you more of an intuition, gut feeling type of guy, or are you a rational, calculated decision maker?
“I try to collect a reasonable amount of information, without getting caught up in decision paralysis.”
WADE: I tend to be more calculated, trying to weigh all the inputs. But I still like to make decisions quickly. So I try to collect a reasonable amount of information, without getting caught up in decision paralysis. There’s a balance you have to strike when you’re in a fast-growing company.
EJ: Any recommended books for a budding entrepreneur?
WADE: Four Steps to the Epiphany by Steve Blank was one that really shaped my thinking on what startups and entrepreneurship is really about.
EJ: What are you reading now?
WADE: I’m reading Turn the Ship Around. It’s a leadership book based on a submarine captain, and his new model of running his ship. Very interesting.
EJ: Do you ever read fiction?
I do read fiction from time to time. I’ve been working through the Ender’s Game series.
EJ: Do you have a key influencer or role model?
WADE: My granddad has always been a big role model for me. He’s 96, he walks three miles every day, he’s a World War Two vet. He keeps a busier schedule than I do. Everyone I know talks about how big an impact he’s had on them. If I’m half as successful as he is, I think I’ll have lived a good life.
EJ: What keeps you up at night?
WADE: We’ve gotten to a point where we have strong product-market fit at Zapier. So the thing I’m worried about is that somehow I or we will screw Zapier up.
I think a lot about how to build the best and most effective team. We’re just trying to stay one step ahead as best we can—from a culture and team standpoint—to make sure this is a great place for people to do their best work.