Most of us would be aware of business-to-business and business-to-consumer models, the specific challenges in each and how it affects the operations of the business. Most startups are trying to solve problems for either a business or a consumer, but there is another league of entrepreneurs solving for developers.
The B2D or business-to-developer model has been famous in Western markets for the last decade. The likes of GitHub, Action.io, Twilio, Heroku have built empires on the basis of this model and many more have created buzz internationally. One of the Indian superstars in the B2D club is Bengaluru-based Postman.
While it began as a side-project in 2012 when cofounder Ankit Sobti was working at Yahoo, Postman was officially launched in 2014 by Sobti and cofounder Abhinav Asthana. The company had created a collaboration platform for application processing interface (API) development, which helped developers work with existing APIs and modify and customise them according to their needs.
A group of developers began Postman as a side project; the team tested the features internally and saw how it changed the workflow of development and started sharing it with other developers.
With huge adoption created through such word-of-mouth marketing and additions made based on feedback from developers, Postman landed on the Chrome Web Store in March 2012. Speaking at SaaSBOOMi in Chennai, Sobti said that Postman had struck developer gold, as an engaged community grew from zero to 500K users purely through organic means.
“We had expected to see users from India and the US, but then we saw increasing adoption from Russia, Africa, Australia and other countries,” Sobti added. By the time, the founders set up a company, a Google Analytics run in 2014 showed that their adoption was across the world as the whole map was blue.
From 2014 to 2020, Postman helped developers and companies streamline and optimise their API workflow. Its extension on Chrome is an efficient way to test, develop, and document APIs. It also helps create complex requests, go back in time, and view results easily. It has launched a native app for Windows, Mac and Linux in the six years since launch to support users in a better manner and across browsers.
Today, the company claims to be used by more than 9 Mn developers in over 400K organisations. It has raised $58 Mn from investors such as Nexus Venture Partners and CRV.
Identifying Revenue Model After Product-Market Fit And $500 Cheque
Speaking to the audience, Ankit Sobti said that Postman started to question its sustainability amid the growth. The question for them was: does developer love equal money?
This question led the team to approach users and question their willingness to pay. Sobti recalls that someone actually said that “Why would we pay for it? We can just develop the product ourselves over the weekend and use it.” While this was demotivating, the founders received a surprise $500 cheque in the mail.
One of the users had sent this money saying that they can’t believe that they are not paying for this product and hence, sent what they could. Seeing the support of the community which drove them from zero to 500K users and beyond, the founders started shaping the business to find revenue-generating products.
Then, the company launched Jetpacks for Postman, where APIs could be tested. The product was widely adopted as people started buying it as teams. However, the company questioned why an individual product was being bought for teams?
This led to another product addition for collaboration. Three months into development, the team started offering tests. “We A/B tested a few points and got incredible response and it was a paid product,” Sobti added.
With time, the company improved workflow around collaboration.
Calls From The Entity Called “VC”
Keeping up with scaling-up is a huge task and Postman was focussed on customer-centricity, which meant developers. It launched a direct customer helpline. With this, the founders were directly speaking to customers who faced any issues and hence, got into the good books of customers.
But then, Sobti describes, that they got a call from an entity called “VC”. “We didn’t know what it was. Then we met Sameer Brij Verma from Nexus Venture Partners and then others at the office,” Postman’s Ankit Sobti recalled.
In one of the first meetings, the founders were showing the latest performance figures of Postman — 500K users, presence across the world, 250 requests on GitHub page every day and more. The question that investors asked was — what does the team look like?
“You are looking at the team,” the founders said looking at each other. That clinched the deal and Postman was launched in October 2014.
The Key Elements Of Growth
Having scaled up and grown too fast, Sobti said that B2D businesses usually have no playbook to follow. He discussed that B2D companies usually start as a small development project and are built to solve some specific needs of the developer community.
Hence, the founder has some lessons, which is building one’s own playbook. Sobti says that growth happened because the product was built to satiate their own needs — hence, by developers for developers.
Secondly, for product growth, Sobti says that simplicity is a feature that is often ignored, especially when the impact is on an increasingly complex use-case.
Further, leveraging virality worked out well for Postman. “Virality was built-in through Postman collections with natural progression for the product and we have open-sourced the Postman collection format.”
Sobti also noted that it is important to convert critics into admirers and then advocates of the product. Building staunch product advocates within organisations has ensured that end consumers are already convinced about the product, since the creators are developers.