I'm here today with James Hawkins, CEO and founder of PostHog from the YC Winter 20 batch. James is here hot off the news of raising a $75 million Series E round of funding at a $1.4 billion valuation, making PostHog the latest YC unicorn. Today, we're going to talk about how PostHog got started, how they pulled off what I think is one of the best YC pivots of the last decade, and how they use attention and humor to compete with not just other tech companies, but with everything out there for attention. Welcome, James. Thank you for having me. James, could you tell us what is PostHog? Explain it to us a little bit. Sure. So with YC, I always feel like this is my homework, being marked by the teacher. We help.
users to debug their product to ship features faster through kind of things like feature plagues and so on. And we help people that kind of custom product data in one stack. And tell us a little bit about the state of the company, how big it is. You guys are pretty big these days. Give our viewers a snapshot of what's going on at Postalk. Sure. Yeah, so we're about 160 people. We're around 300,000 customers across like three. I mean, a lot of free customers unpaid. We have several thousand paid. We have, I think, 16 or 17 products kind of in production or in development. They're all at different kind of stages. And we've been, I guess, at the moment, the main thing we're doing, and the reason we're raising this year, we're...
pushing very hard on getting more products still out of the door so instead of kind of going up market we're going just across more of the customer data that people are generating um and we're automating a ton of things through ai which has been a long and arduous process um but we're starting to get to the point where we're starting to get proud of what we've achieved so far but i still kind of feel like oh we haven't got started yet there's a lot more to go um which i don't think the feeling will ever go probably but um yeah it's like being a lot of fun and we're just starting to scale up pretty aggressively now like we're i think we started at 70 people this year um and so we're supposed to be about 200ish by the end of the year or something so we're starting to get properly into going to scale up at this point so you've got this team you've got all these customers, you have all these products that you're developing and improving on. But what was the initial product that PostHog started with? What was that, the first thing that you guys brought to market as PostHog? Sure. So yeah, the first thing that worked for us, we had a bunch of pivots before, was self-hosted product analytics. Because we pivoted so many times, every time we had to set up product analytics over and over again, and we were just getting frustrated having to implement it, I think we found that there was an awful lot of really strong competition. But we felt all the products were built for the product managers to force engineers to go implement. But it's like reasonably technical, especially my co-founder is a very technical co-founder. We're just getting annoyed at like, I can't, I want to write SQL, I want to see the data underneath. I would like to keep some infrastructure so I don't lose data due to ad blockers. So we thought, okay, we think there's
a self-hosted alternative and we also we spent some time 20 potential customers um and we found that quite a lot of people had self-built their analytics stack and were maintaining this kind of janky system which we felt we can productize something like that because your infrastructure and we could see this working quite well um so yeah we started with just open source analytics on Hacker News we spent like the last four weeks the batch desperately trying to get that out of the door. And then we actually pivot, we iterated it afterwards and now we're all cloud-based with multi-products. But that was the thing that landed for us finally. I think at PostHog, well, there's this meme among founders of Pivot Hell. And it's a thing that YC founders talk about a lot where you're going from idea to idea to idea and you're trying to find something that's going to work. And you guys not only came out of Pivot Hell and have built this awesome company, but what you built was literally forged in the fires of Pivot Hell, right? Like while doing these pivots, you had this pain that only came because you were doing the pivots and trying to do them at a high level, setting up the analytics over and over again. Tell us a little bit about...
how you guys actually got to YC and started this journey of pivoting and finding startup ideas that might work. My co-founder quit. We used to work together. And when I heard news that he was leaving, I'd also been thinking about leaving and that triggered me to go, okay, I want to do my own thing. So I made sure to grab him instead of getting him to go off and work in.
another startup, whatever. We thought, hey, let's just do our own thing. And when he was leaving, was he leaving to join another company? Was he leaving to start something? Yeah, I think he was actually trying to get a job at Facebook at the time. And he was doing an incremental kind of career move. And I showed up being like, I think I have this idea that we'll probably have market fit for in a couple weeks' time. Of course, of course, they all do. Yeah, there's only a hop, skip and a jump away. And then we can just, you know, I had like a, I created a list of problems I'd encountered professionally thinking, okay, it's all the problem I've had myself. And we started going through the list that we thought we wanted to bootstrap initially. So the two of us were just like working out of coffee shops. One of the main problems we found was every time we went to see a customer, we'd have to buy another round of coffee. And so we often end up going
whatever the coffee equivalent of wasted is basically. So eventually we did this for about six months and we worked through an average of one idea every like five, probably average about five or six weeks. Do you remember what any of those ideas were? Yeah. So the initial thing we tried to build was a sales territory management product. So I used to run a sales, I was a leader of sales, and I felt that like in sales, you're literally wasting over 90% of your time because deals don't usually win, they don't usually close. Like they usually just float around and gradually get killed off. And we sort of get better at not focusing on deals that are closing, but on the ones that aren't closing, getting a bit more ruthless using statistics.
pull them out of people's pipeline and change the territory for the sales team is what I thought might work. It was just kind of really complicated to build. I think because I'm much more technical than a traditional sales leader would be, I just think we built some kind of complicated and I don't think our go-to-market was right or anything. Yeah, we had this idea, we built it. I think the thing that was important or the harsh lesson I learned was my co-founder was building it. I was just trying to get interesting.
prospects to buy it from us. So I got through about 15 series B, C, D sales leaders queued up saying they wanted to use this. Well, they said they wanted to use it. We got the first version done in a couple of weeks, sent them the link to create an account of the 15. 14 of them didn't even click the link. One clicked the link and then didn't create an account. It was like, we should have read the mum test was that we hadn't done any of the user interviews correctly. But also it made me feel that building for salespeople or sales leaders in particular, I feel the signal to noise ratio is pretty poor because they're really quite willing to hop on quick calls and are very, very positive and kind of very friendly people. A little bit later it kind of dawned on us that
we think we'd be better because we're not very good at product we're terrible at product initially because we're kind of bad we need to deal with people that are what they say is close to what they'll do and we felt that like natural problem solving people like engineers or customer support people probably would be a better audience for us to work with because out of all the many variables you can get wrong like you might be like your product's incredible but you're terrible at explaining what it does you'll still fail um and we thought okay one of the rails we can remove from this equation is the person being a little bit um easier to read basically and so that's a big part of why we wanted to build something dev toolie later on was that sort of realization um but yeah that was the first thing that we worked on and so when you guys did Y Combinator the product that you had was another pivot was having developers take surveys about technical debt when they would submit a pull request. And so you'd already done a few products by that point. You came into YC with another one. Did you guys have a, like, how did you kind of keep your spirits up? Or how did you track your trajectory? Did you feel you were getting stronger or better or closer to the target as you were going through these pivots? I would like to think that was true. I'm not sure it was. We didn't reflect that. We should have asked, like, are we actually getting better each time around? I think we should run a retrospective, basically. I don't think we actually were getting that much better each time. There are definitely some things that were consistently very important to us, though. Like, for example, we went full gas on each idea. Like, we didn't sort of, like, call in. Like, we would go in person to...
every single customer that was remotely interested, we would go in person to go meet. We started in England and became San Francisco to do YC. We'd catch a bunch of trains and buses to get to a customer in some random place and we would put the effort in to go really push it. Because then what happens when we start charging for all these products, you would find that, oh, I'm not failing this because I don't have a relationship. I'm kind of friendly with this customer at this point and they still don't want to buy from us. It's a really good sign this product isn't solving the problem. This really demonstrates me it's nice to have. In my previous job, we used to sell enterprise software for millions of dollars a year. And I can remember multiple times thinking I'm having to work kind of as hard to sell a $50 a month SaaS subscription as I was to sell a $100,000 a year plus deal in my last job.
I know that I've tried really hard. And so I can rule out one of the other variables I guess is like, are you actually trying as hard as you could be? And we were. I think that helped us feel confident enough to go, this just isn't working. So yeah, we just, we worked very hard. And I remember it feeling weird, like on LinkedIn, for example, I would talk about like, hey, this is what we're up to. And it would be like, one week it was like some dev tool, next week it's a CRM thing. But we just didn't care, like we just threw ourselves into each problem. There's an aspect of shamelessness that you have to have. Yeah. To just kind of keep up the momentum and keep trying and not get bogged down. I think it's easy for it to feel kind of lame almost. Like you have friends who are like in investment banking or they have these like proper careers and we're doing something that just seems so kooky. But like that's the bit, I think that
most people don't run companies because that first bit is so existential and all over the place. And I think we just have faith that if we just keep making, the input we're looking at is like, are we making very regular, real progress? That's all the ideas. We'd often at the start of the week be like, okay, by the end of this week, what is the list of things? We will feel good if we get them all done. And it will be something like, okay, we want to do like 10 customer meetings, build these three big features. And we just tell ourselves to account on the very short cadence all the time. As people, I think we got much stronger things like product much later on, once the postcard had taken off. But I think we were just like very, we just, yeah, throw our heart into things. We're very fast. That was kind of what we needed, I think, realistically. You guys were working through these pivots. Maybe getting better, maybe not.
trying to be wholehearted, trying to be consistent, trying to be really committed to the bit, maybe as a comedian would say. When you started with the open source product analytics, what became the final pivot? What signals did you get early on or signs that maybe this is it? Maybe we're really onto something. It was a month before YC Demo Day. Tell us a little bit about how that unfolded. Yeah, so I think we had a slightly higher level of excitement about this idea ourselves. I think we had a couple of ideas where in our heart of hearts, we weren't that interested in them. Like we were kind of doing them because we felt like we had to get something to work. Whereas I think this one, we had an office hours here and I can remember, and we're like, well, we're kind of thinking about building this thing that we'll do two, at the time we thought two things were important. We thought we want to capture it all.
user data completely automatically like we don't want anyone to have to start event tracking manually we didn't realize someone had already built this um and that didn't turn out to be particularly important but then the second thing we're like we want to be able to self-host this thing so they consider infra and we came out the office i was going ah that's not the right framing it's open source product analytics then it's not just about it being your infrastructure it's also just like a whole vibe like i think immediately we were like we feel very confident i could see that really landing on hacker news i mean both my girlfriend would both read it and it just felt like the kind of thing you would see on the front page so the excitement was a little bit higher for us i do think it's a bad idea though to like sometimes i see other founders they're like i'm waiting for an idea that i'm excited about but i think the reality is for us it's we had to just build a bunch of things to find the thing we're excited about what we didn't do was like sit cross-legged on the top of a mountain waiting for inspiration. So we're trying a few things. We started going, this idea just doesn't feel good, but we know that because we have tried it. You had to find something in the middle of what people want and what you're excited about. Yeah, exactly. And so I think doing stuff gives you much stronger. I think it's like a Brian Armstrong quote, but doing stuff gives you much stronger, signal more information. And then I think when we started booking interviews, it was a little bit easier to get people to talk to us. But the big deal was on Hacker News when it...
was just on the front page and had like, it wasn't the best ever. At the time, it was pretty good compared to what I had before. It was a good launch. You had a good Hacker News launch. If you look at it like, so like 2023, 24, 25 vintage Hacker News launches, it was very mediocre, but it was enough to get an initial audience. I think, because I go back to people who have demo day slides a lot of the times when helping batch founders figure out what they should say. So I pull up the post-talk slide every now and then. And I believe, according to the slide, and I think it's true, it was the most upvoted DevTool Hacker News post of the year. So pretty good. I remember being in the office hour. You probably shared the idea with a bunch of people, but I remember the first time I heard it, and it just made a lot of sense. There were a bunch of product analytics companies out there.
But no one had really gone all the way to make this truly developer-focused by going open source. So it just sounded like something someone should try. And I wasn't that surprised that it hit the way it did and was really excited for you guys at the time. So, okay, so you had this, you were starting to get some users. You had to go out and raise money for this thing at Demo Day. And you'd only been working on it for a few weeks at that point. What was that like? Like, how do you get your conviction up to go, you know, pitch investors about a product that's really only a month old at this point? It was very mixed. At first, we felt really good. We were like, okay, it feels like we're going to have this done in like two days or three days. Slam dunk. Yeah, I think we're coming in going like, yeah, we had a really solid launch. I think we were still buzzing a little bit after like, oh, it's such a feeling of kind of relief
just instantly the day we launched it went from being a push basis to pull basis getting people interested like something's just like we're trying to service all these random problems of feature requests and stuff we can see coming in and so we went out to raise I think very confident like we thought we'd kind of be pushing quite a big valuation at the time and I think we felt that we will have this done in just a few days and the timing was horrible because it was 2020 in March and the same week basically COVID went from being this somewhat niche thing to changing the world and everyone just suddenly pulled out so we kind of went from feeling like oh we've got like all the fanciest VC firms in the world are interested in this thing to everyone's pulled out and we're now doing like trying to get angel checks for 5 000 bucks a pop to try and get all the way up to like raising a few million dollars this is gonna take a long time um so it was very peaky and we also had a lot of stress over like we're in the us still my wife was at home and pregnant and i was worried about getting stuck in america and my co-founder left and because he was also worried about getting stranded over his visa and stuff so there's just always chaos kind of happening and we just kept plugging away basically um i think it was very easy to it would be very easy to think to get disheartened and it was painful but we just didn't i guess we just kept going um was the main thing and so we were doing angel checks um happily taking 5k off of people um until eventually we got
a proper term sheet and then I went to another one and then we got the round done very quickly and then the market completely picked up like even just a few months later I mean like a series of months after the seed round had closed but I think the statistics are something like I think about 160 different firms in the seed round. I think for like, if I added up the total number of firms I met for the series A, B, C, D, and E, probably like 20 in total, like 30 in total, it was by far the hardest round we had to raise. But also we sucked it. It's not just the market, like we sucked it at pitching. We're trying to people please, I think, too much. And so we would be like, well, what are you gonna do with money? And it's like, well, you know, we can't get some revenue, we'll build some features, which is a very vanilla feeling. And we had a lot of people rejecting us because they felt we were too early.
But the reality was, it's like what we're dealing with, a lot of these investors have never invested, at that time, never invested in open source at all, but the vast majority hadn't. It was much more unusual then. And I started realizing that I don't even believe that we'd want to spend money across all these areas. Like, we actually just want to get all in on the open source project for a while. And I think that's very bad advice for something that doesn't have competition that's making lots of revenue, so be very careful with something like that. But we started getting much more opinionated, and that's what started that eventually landing. So, hey, like, you're out of your mind if you think we're going to go big on, like, hiring a big sales team or trying to go into the enterprise or something. Like, it's just about building this, like, nice big inbound kind of community. We think is the, if we can't do that, nothing else will follow. And we need to really establish that property.
are pretty agnostic on what the plan is. So long as there's a plan. And that you're really passionate about it and you've thought about it and you're ready to go execute on it. I think there's a marketing off quote, which is something like, it's better to be different than right. I think it's almost equivalent here where I think it's, if you're trying to raise money, it's better to have a plan than it is to necessarily be like somewhat correct. Like be either very clearly right or wrong because you'll learn something from that. So that round was really hard. You talked to 160 investors. It took months to get the money? Yeah. Okay. Fast forward to this latest round that you guys just raised. Obviously it's five years later, things are very different. The company's in a very different place. You have revenue and customers.
What's it like to raise a $75 million round? You know, how is that relatable to folks that maybe are out there trying to raise the first money for their company? What's that experience like? Yeah, perversity is easier. Like we had, we spoke to one investor for this round. We raised him in P15, this one called Chalendra, that is the main partner, also on of, is involved as well. The round before he tried to take part in, we only had just gotten to know him though. So we kind of felt like we wanted to spend a bit longer with you before we raised with you, basically. We did spend a little bit more time with him because we liked him as a person. They offered to do the next round preemptively. And at first we thought it was a bad idea because we just felt we don't know how we would...
spend this we haven't spent like the round before the round before almost but then at the same time what was starting to happen was we were getting increasingly confident on AI. What actually happened was I went on vacation and read about some of the motives for why some of the co-founders built OpenAI in the first place. And I thought the reasoning was really interesting. It was humans have a brain. It's a physical object. We can therefore build one, basically. And there's no technical reason we can't build ADI, essentially. Then I just, and this is nerdy reading, but I think like, what are the specific differences between your brain and LMS today? And I kind of concluded there's a lot of things that could be built, but I don't understand why they don't exist yet. So I therefore think that AI will, I don't think it will flatten out. Like I think the rate of improvement may vary, but I think under a long timeframe, it will be incredibly important to the world. So I've got much more bullish on its importance.
and then thinking it worked. I'm like, okay, I can definitely see a path. I just spent some time reflecting. I'm like, okay, how could this shake out, basically? Like, should we change our strategy if we both believe this is this important? So at the time, we were thinking about building like a CRM, a support platform, all kinds of other customer data-oriented products, and everything was kind of working. But we thought, actually, we can do so much more in the realm of product at first, like we can build product autonomy out. So we want to go deeper within our products that help you understand what to build. So we wanted to work on, like the moment we were working on a desktop app, for example, that ships forward across space on your customer data. So we'll look across all your session recordings, all your analytics, all your error tracking, your LM traces, go, hey, these are the issues we can see in your customer base. We've literally fixed them whilst we're asleep.
Here are the pull requests. So instead of like, please build me this feature, the flow is pull-based. It's like, hey, we've built these features based on what's happening. You can just review, close, edit, merge them, depending on what you want to speed up development further. And we just were like, hey, let's just go. We want to be able to fall in on this idea. And so we raised to have just like the comfort and confidence. So a lot of it's psychological. Like I don't think we'll manage to suspend it, but we want, that's kind of the point. It's like, this means that we can just fully embrace our product strategy.
and take a bigger and just like increase the size of swing that we're taking. Well, and it sounds like what you're saying is you're able to fully explore the implications of the original idea of PostHog, which is understand what's happening in your product and what your users are up to. And there's all this stuff downstream of that. Like once you understand it, then you can do these things and take these actions. Yeah, because we start thinking like, okay, it's a bit like if your customer is like a painting that you're trying to understand, if you have one data type.
It's like seeing a painting, but only being able to see the colour blue. You're not going to get a nuance to understand your customer. Like, it looks like they're not using this feature. We should email them to cross-sell them the new feature we've just built. But at the same time, other data might be telling you something conflicting. Like, they're really pissed off in support right now. And this is a terrible time to automatically send an email or something. So we kind of felt like, and that's what a human would do today, is you kind of look across your tools. And we thought, oh, we can basically build something that does this. And so we set off trying to build basically a product manager. That's a physical thing. We can build it. Yeah, we don't want to build something that we can't conceive of. We want to build something that exists, but just like a better version. And we're like, well, there's a human product manager. Has product market fit? Like, companies buy those. That is sort
what are the products that are market fit that have customer data? We will build all of them. It's more convenient. But then we're just like, well, also like you could consider the team members and thinking about sales as market fit in companies. So does support, so does engineering. So can we build those things now because it's now possible? I think it's going to be correct that that works, but we'll see. All right, all right. You mentioned to me before we started talking today that this is like, unexpectedly, maybe you're having more fun than at any other point in the company so far. And that is a little counterintuitive to people. A lot of founders say, oh, the early days are the most fun. And they kind of look back nostalgically. Why do you think you're having more fun now than ever before? The web is much more leveraged now, which is quite entertaining. I think before you're so much of our focus was trying to get.
attention from people because you have no attention by default it's the world is very noisy and so i'm just like sending emails and linkedin messages into the ether basically and it just feels like doing awful lot of stuff that has no impact obviously when you do have like a tiny little spark it needs to be fire whereas now um it feels like we're playing a computer game we've just unlocked like rocket launchers or something so it's like oh we can like go absolutely nuclear on this particular idea and like really fully build it out in a way that would be very hard to we're like lucky enough to be able to build this because it involves having to have like 15 or 16 products and also a bunch of ai stuff and we need to be able to like have the time to build this because there's been remarkable work like intercom where they built fin um And we're trying to do this analogous to that, I think. But it's not making PostHog work with kind of a couple of products. It's trying to make it work across like 16 of them. I feel like we're going much deeper than we've ever been, but it's enabled us to make a bet like that. Like I think similarly, if we're starting from scratch, trying to build what we're now trying to build would be probably impossible, I think, like SpaceX or something. It's a much more grandiose idea. Like on day one, it's not building like the transportation from Mars. It's like day one's like we need to build a relatively unambitious satellite launching business. I think we've sort of done quite a lot of homework that means we're able to now do these tests, basically. I wonder how many products PostHog would need to have to be as...
Grandiose, as ambitious as SpaceX. It's an interesting comparison. You mentioned having fun, getting this work out there. I know building in public is something that you're keen on. What does that look like as a CEO? Getting this attention, getting that spark and putting it out there and trying to start a fire. How do you think about that? Doing it in the open where people can see what you're up to and hear about it and follow along. Trust was the original reason for it. We just felt that even if you're offering, most of our users don't pay anything. Open source project, no one paid, but it still takes up. There's a cost. It's trust in terms of what they're doing with data and also just time with setting this tool up. I think especially software is getting quicker to build. There's more software appearing. It's getting more and more competitive. I think it's become a step change more competitive with AI.
And so we felt that, okay, the fundamental thing we have to achieve in marketing is we need to highlight how we're different because it's in a busy industry. And then we need to build trust with users. And like the foundation of trust we felt was transparency. So instead of just having a one pager landing page, we're going to like really fully explain everything we can about who we are, what we're trying to do. I think that gave us the trust we needed. And we thought about kind of, I looked through other happy news launches and just sort of summarize, like, these are all the pieces of critique I can see. And so we're going to make sure we have transparent answers to these types of questions. The questions would be things like, they don't have a clear business model. I don't think this is sustainable. For example, there's like this sort of inherent suspicion of ideas. I was like, okay, let's just like think through.
these types of questions that we know that our audience developers would have and we'll address them on the website so we like you know how paperwork is like hey this is how we think the paperwork is going to work in future and that was from like day zero you put some of those things yeah like before we launched i think the other thing we realized from content and like a marketing perspective was i think experts writing about things is more compelling often than non-experts if you look at like the front page of hacking news there'll be like incredibly technically savvy people talking about very complicated topics but often and i thought oh man i'm like i'm not clever enough to get there but i need to figure out a way to get us visible in hacking news it's like the popular place for our audience and i thought well i am the thing i'm actually an expert in is our business and so i can write about what we're learning and doing and so i feel like a really natural topic so we write a blog post also doing a mighty badge like shortly after the launch of what it's like moving San Francisco to do this. I remember that post, yeah. Again, that was also viral, but I think a bit of a lot of traffic that humanized us underneath. I was like, put photos in of like, we climbed up like Twin Peaks, for example, at night. I think people realized like, oh, they're human beings. In the same way that someone might be really aggressive online, but as soon as you meet in person, they're much more chill. It's the same sort of feeling. And we're trying to make that clear. Like with all our products today, you can see like...
the literal engine is that we have every single team member on the team pages. You can see all the, so you can look at like product analytics. You can see the Hampton engine is building it. You can click their bio and read about like their pet cat, for example, so that you're like, oh, there are people building this. The humanization I think is really important to stand out basically. Yeah, it lets people know someone's at home. If you go visit this house, there'll be someone there and you'll have a neat interaction. I actually, I think about your moving to San Francisco post quite often over the years since because if you look at it, there's nothing that remarkable in the post, but you got it on Hacker News. People read it. They talked about it. It was discussed. And I think you're right. It's because you just showed some of your humanity behind this product that people could use. And everyone's looking for ways to relate to folks like themselves. I remember when I read that, I thought, wow, they can
They can climb up Twin Peaks and write about it and get developers to want to check it out. This is going to go somewhere. Building in public is one of the ways that you guys are really connected with developers. I think another aspect of that, though, is humor and bringing a sense of merriment, amusement, and maybe even a little chaos to how the post-hog message gets across. One of the manifestations of that was present all over San Francisco this last year with the crazy billboards that you guys put up. In my opinion, like there's billboards all over the city. When people move to San Francisco, they're shocked by all the tech ads everywhere on all the billboards. But I don't think I've seen anyone do quite what you guys did with your marketing. And so I thought it'd be really fun to just take a look at some of these together and get your take on what's going on here. So I guess this first one is about session replay ostensibly, but it's also like an ad for tomato sauce. And it's promoting the sweet taste of understanding. Where did you guys come up with this? And what made you think to compare tomato sauce to session replay, for example? There are a few things. I think kind of by design, we wanted it to...
it had to be different so kind of our grand theory billboards was how interesting your brand is if your brand's normally here everyone's a bit more interesting on billboards like if you just look at companies seem to come out of their shell a bit more on billboards then they don't their websites why do you think that is i think they're trying to stand out basically but i think it's a bit like yeah this is gonna sound harsh but i think it's a bit like watching like a first grader play football where they're gonna dabble um but like they're starting from basically a first grader where it's like we're already pretty weird online so our billboards need to be bizarre like they need to be like totally out there so we should like lean harder into this which we think will work because the whole point is like it has to stand out in the environment and we need people to we won't be able to talk about and see it and we're not trying to get conversion like it's you're unlikely to decide to install like our SDK whilst you're driving your car down the freeway instead of trying to please everyone we're not going to care about conversion we are just going to try and raise awareness and then the other thing I think that had struck us was we're actually doing a bunch of social stuff we're like oh I can like spend the time to write a useful post based on something we're learning and that will work reasonably well to get some like if it's helpful people will share it but somewhat depressingly if we write like if I just write something I think is funny it can sometimes go a thousand times further in terms of reach so if i'm just trying to raise awareness it has to be funny um that's actually the primary thing we want to get across and so yeah we just really want to like crank as far as we could over on the like weirdness slightly funny scale um it is a real skill i think we've been trying very hard to i think a lot of corporates whatever do like corporate try hard and it's very hard to not come up because you're obviously trying hard because your stuff is almost a parody of corporate try hard you've transcended corporate try hard it's a very um like on hacking news for example people talk about like on hacking news it's like trial by fire basically where there's unbelievable criticism our marketing channel in slack is like that too where people like your joke is just not funny um it has to be better you look like you're trying so it's
We have a very heavy feedback culture in marketing. Let's talk about that. So before a post-hog tweet or billboard gets out into the wild, what is the incubation? Yeah, it's a very small number of people involved, like probably like three or four, and it is very high trust, direct, placed. And so we're really trying to get something that we think is genuinely, it might be sarcastic, but something that's genuinely funny to get onto a billboard or just something that would make us laugh or that we would want. We are going to do them for ourselves. Like, is it something I think would be quite funny to see? It's sort of a bar. It feels like competing against B2B software because there's all these AI billboards that are quite similar to each other.
But I think the reality is if you want people to pay attention, it's like, no, you're competing with like what they're listening to on the radio or what they're doing on the phone or whatever else. And so the bar is so many times higher. And so it needs to be like, at least in that realm. It's not just about being like doing a slightly better, incrementally better job than other software companies. And which is like impossible. I mean, no one near is interesting because there's a piece or something. But like the mentality is like, oh, I wish we need to be playing that game at least a bit more. We felt that we would make fun of adverts in general. And so we thought like, okay, we'll do like a very like Americana style ads. But we'll make it like it's like a 1950s thing, but for like AI software. So it tastes better than spaghetti.
And you're done up here like the host of a 1950s food show talking about your B2B assassin product. Okay, and so why 1950s Americana? Like, where's the appeal there? I think if you sort of say, like, what's the most stereotypical kind of billboard ad you'd imagine? I think you sort of would imagine you would go back to, like... What's the origin of billboards? That's almost when you look at them from a positive perspective. I think of, like, oh, like, back in the day, ads were kind of cool. They're, like, funnier, better thought out. Whereas now they've just got a bit... Death to humans. Yeah, yeah. Or it's just, like, big words on a billboard with, like, no design element to it at all. And we thought, like, actually, let's try and make something kind of...
little bit like warm feeling um and pretty stupid like i was wearing like a frilly frock and what about the decision to put yourself in all the ads okay so it's like i don't even realize this isn't me or they think they've got some like random middle-aged guy to turn off these ads um either case is probably fine um yeah we did a lot with hedgehogs we did some with hedgehogs as well but we felt again it's just not quite as edgy it's hard to make it not feel like too professionally done almost where it's like kind of kooky to have like a very average person on the ads or whatever, instead of like something that we put tons of time in. Too hard on yourself, James. I mean, I agree. Look, I think these are great. My wife gives me so much grief. I get so excited every time I see a post-talk ad around the city and my wife is like, let's get you guys again. But it lets people know that someone's home, that there's actual people behind this and that they really care a lot. You know, even things down the details in the typography, like it sends a message. We are going to make a product that's also this well thought out. And it's also trying to get you what you need to the same level. Yeah, I think it's just like a level of signaling that you know what you're doing to pull off an ad like this, because it does show a level of saverness. Like the website is similar in full process. Like we're trying to...
demonstrate someone who isn't yet using our product that oh no they kind of get technology or they like kind of just get me as a person a little bit better than like face this corporation let's talk about your website i think you've got the best website of like any b2b company maybe in the yc portfolio i don't get in trouble for saying that but it's incredible your website's awesome what was the genesis of going in that direction because it wasn't always like that you mentioned a little bit ago that early on you guys had a lot of back content a lot of lore on post hog early on but the website itself was still pretty typical static website with some information for a SaaS company. But now it's this whole experience simulating, you know, using a computer in post-hog land. Where did this come from? I think a few things. I think we kind of, it's like 2021-ish. The website's our sales team. Like there isn't a single customer that won't go through the website before they buy the product. And especially if it's a nature of our audience, we're very self-serve. And so I'm like, well, we should invest in this. Like it's the, we don't have to hire a sales team. It turns out in the first few years, or we had, but it was tiny, kind of like two people. And so, well, I think we can therefore justify spending like a...
ridiculous amount of effort on the website the cost isn't that high but like we can put this kind of energy really because i think this make us stand out so i think a lot of people quickly 80 20 something you can extremely quickly get to a polished website now like in a day you have a polished website so everyone just does that like cool i'm done now this is 80 20 then move on and i'm like well like marketing to me is like because we're in a busy industry it's about standing out and so there's no point doing 80 20 like there's it's just a missed shot it's like actually all the rest of the website has come from like the last percent of effort whereas i know we're gonna go like so insanely far past what is normal that it is remarkable which means that people will talk about it um because when we talk to users early on it turned out all of them coming to us for people showing up because they heard about us online or someone recommended us and we said why did they recommend you and it was all tools in one low pricing um develop a brand and very technical support people and we have literally done those things and but it's like okay we can't keep doing them as it is we should be trying to crank the dial up further so it's like instead of building like three products we should build like 300 products and how could that work um or on the brand side it's like okay post is kind of weird it's like it needs to be weirder still like it needs to be so weird that it polarizes every day we'll get a whole bunch of people talk about that website and we monitor all our brand mentions online and it's going to be like either this is literally the best thing i have ever seen and we also get
this website is atrocious but we feel like we're polarizing it largely in favor of our audience more like I'm sure there's some people who are like what but we're happy to push so hard in the direction we think it's something cool for our audience that the people that aren't really our focus are going to really disproportionately hate it basically and then partly the other thing that was happening was it didn't just come from like a pure aesthetic perspective we genuinely worked on a workout how we build a website that fully documents and prices for like 15 or 16 products but we also have a whole load of other things we built that we think are useful so for example we have a cool developer jobs board it's like a jobs board where the filters instead of being just like location or pay range or something, are like, what kind of laptop do I get? Is the majority of the company developers? The stuff that an engineer actually would be interested in. Yeah, I mean, this is like a fun project. We're like, well, this is useful to our audience. We have that in there. We have like a handbook that's quite popular for people to read and learn from. You can learn how everything works, like how to pay people, like when we let people go, like everything is there. And so that's like another thing. We have a newsletter with like more than 100,000 subscribers that's also in there. And so it just felt like the form of a website of just like a thing, lots of pages you scroll through. It felt like we were doing something much more multidimensional than that. That was the two things. It wasn't purely aesthetic. It was also...
from experience, but we actually thought it would better reflect what we're doing. Postdoc is quite a complicated company. Again, it's tempting to be like, okay, we should just have a single landing page with one button you click and nothing, no other information. That's not what our audience wants. You're kind of spitting in the eye of the idea of a funnel. It's almost like instead of a funnel that you're trying to push people through, you're just giving them a great piece of cheese to dig into and enjoy and savor. Well, we were wondering what happened to the conversion rate, and we were like, we kind of knew this is going to tank the conversion rate. We were like, there's going to be much more traffic and the conversion rate is going to be worse. And I was like, well, if we ongoingly have way more traffic and a worse conversion rate.
if I could like double our traffic and half our conversion rate I would take that and so we launched it kind of knowing that's probably what would happen but we did also think like we think this is interesting enough that people will actually switch on for once online rather than just like sort of like trying to rush to get to the button and like we also thought like I mean if a developer can't work out how to get started when there's already like three of them on the page like you know that marginal person who maybe would have not converted like I don't know, it just felt like you were playing like a weird game trying to appeal to that user. And so we think like of the marginal user, this would press enough that they will convert despite the fact the conversion experience is very unusual. And so yeah, the conversion rate did, it didn't actually tank. It was like maybe 10%-ish off the top of my head, but we were going to do a post on it, it was worse. We did like one experiment to change the flow slightly. Now the traffic's much higher, the conversion rate's significantly higher too. So it's performing better from a conversion perspective, even though it's like wildly complicated. My favorite part of the website, you have this unhinged merch shop that has some deep cuts in it. And my favorite of the deep cuts is visitors can buy a signed photo of James and Tim, the founders of PostHog, and it's sold out.
Someone actually came and bought. I think we sold one. I love the Yacht Rock aesthetic of the photo, by the way. Yeah, we've got a few boating off-sites. This is supposed to represent alignment, but I think about it on the way here. I actually think the reason that feels funny is you go like, this is representing Tim and I being aligned and close together, but this is what aligned would be. We're close, but... Something else, this, yeah. All right. Well, thank you so much for spending time with us today and talking us through all this. I know we have so many folks out there that follow the videos that we put out there, looking for ways to break through. And I think your point about you have to be remarkable is obvious.
but overlooked so much today. And so thank you for sharing some of the ways that you guys have figured out how to try to stand out and be remarkable. And congratulations again on this latest round that you guys just raised. We're so happy for you guys. Excited here at YC. Yeah, thank you very much. Yeah, it was monumentally important to us to go through the program. So yeah, if you're listening, like, go apply to YC. All right, thanks for joining us today.