Building a successful startup with Elliot Shmukler, co-founder of Anomalo and former Chief Growth Officer at Instacart

Creating your own business isn’t for the faint of heart. Just ask Elliot Shmukler, co-founder of Anomalo and former Chief Growth Officer at Instacart. In his first year developing Anomalo, Shmukler truly believed in the product, but customers didn’t necessarily feel the same way.

“The first version of our product didn’t work,” Shmukler shares. “As we were going to our network and had various companies try it, we could see it wasn’t working. They were deploying it but it wasn’t meeting their needs.”

So, how did Anomalo go on to raise an impressive $39M in funding and 10x its annual recurring revenue (ARR)? Tune in to this week’s episode to find out how Shmukler turned things around to build a very successful data monitoring startup. Plus, get his advice on what to do when starting a business.

Talk to your customers

When developing the product, Anomalo’s co-founders were convinced their unique approach through machine learning would be the perfect solution for monitoring potential data issues. But they didn’t connect with their customers first, so they lacked insight into what types of gaps their product could help fill.

Shmukler advises, “Talk to your customers who use your products—or might want to use them—and try to understand what’s working and what’s not working. Turned out our customers really wanted to be able to customize our product and had difficulty trusting black box machine learning models.”

Build a product with broader appeal

For most startups, if a product isn’t working, the usual advice would be to cater to a niche market and build a product specifically for that market. In Anomalo’s case, doing the exact opposite is what led to its current success—and it was a result of talking to customers.

By communicating with customers, the Anomalo team started to understand that they required more product customization. “Our product was appealing to a very diverse group of people in the enterprise; we needed something that everyone could use,” says Shmukler.

They also realized that their customers’ data teams have different maturity levels—and therefore varying needs. “As we went from company to company, we realized some data teams are more mature than others,” states Shmukler, “and the issues these teams encountered are very different.” Wanting to serve such a wide band of maturity levels meant the team had to build a broader, more versatile product instead of catering to a niche group of customers.

Enable a feedback loop

Customer feedback is crucial to any business in the product ideation stage, but that’s not the only time it’s important. Businesses should regularly solicit feedback to ensure they’re meeting customers’ needs. Here’s how Anomalo does it:

• Set up a Slack channel with customers: The moment customers have a question or a piece of feedback, they can post it in Slack and instantly reach the Anomalo team.
• Host office hours for customers: The Anomalo team hosts weekly Zoom meetings where they answer customer questions and consider any feedback.

Creating a feedback loop enables businesses to continually make improvements based on customer opinions and suggestions. This is critical to increasing customer retention and providing a product people want to use.

“No matter how great your idea is, the idea needs to be refined with what customers actually want to buy and how they want to use your product,” says Shmukler.