Acquisition #8 - Supportguy.co
We delve into acquisition #8 - SupportGuy.co, a micro SaaS that is set to revolutionize customer support with its AI-powered chatbot. This acquisition aligns with our vertical integration strategy, to own and optimize all tools we use to manage our portfolio.
We bought another micro SaaS. We are still working through a larger deal that may still come together. It's been an awkward few months trying to balance keeping enough cash aside in case of the larger deal coming through while also not killing momentum. Momentum is ethereal. It comes and goes. With XO we did zero deals for several months, then did 3 in 2 months. We're in a similar spot now. We did Colddm.me a few months ago, and now just bought this new micro SaaS and it just so happens it's from the exact same developer as Cold DM! What are the chances of that! At the moment it feels like we have a bit of momentum, and I'm going to run with it. If nothing else, momentum is fun.
What We Bought
What does it do?
Never miss a customer inquiry again with our ChatGPT powered chatbot - the always-on, always-available teammate.
I see a massive opportunity in disrupting an intercom-like product. Intercom is a nightmare for me personally. I don't let myself log in anymore. It feels like death by a thousand cuts. People constantly asking the same stuff over and over again. No help desk article link is enough, they want the answer, not a link to an article. But I give the same answer every time anyways?!? Infuriating! And these customers don't want to be on there either. it's never a good thing to hop on support chat. It means something is wrong, broken, unintuitive, etc.
I believe with LLMs we're now at a point where we can actually give users the real answer to their question. Of course that answer has to be documented somewhere, but I cannot for the life of me get people to look up help desk articles and find the answer themselves. I don't blame them, when I'm using someone else's tool, I don't want to spend the afternoon sifting through 100s of articles, nor do I want to wait 24 hours for a response.
So with Support Guy, you upload your knowledge base, and the chatbot will answer the question given the info in your knowledge base. It's trained just for your company, on your docs and info. And it's all based on the same chat gpt technology we have come to know and love.
The vertical integration thesis
I love the idea of owning all the tools we actually use to run our portfolio. Email marketing, newsletter software, NPS scores, banners, change logs, feature requests, support chat, referrals, payments ... all of these are tools we use and pay for. It's a cool idea to think of a vertically integrated acquisitions company. Not only are we a one-stop shop for ourselves when we buy a new saas, but we can also be that for other saas companies. If we use them (like actually use them) in production to manage our own companies, we will intimately know the pain and intimately know the product roadmap since we will be power users of our own products. Support Guy is probably the first of several bets on this concept. We're looking at newsletter tools, referral software, etc to also acquire. But the almighty chatbot in the lower right hand corner is a powerful piece of real estate. If we can truly build a foundation off of Support Guy, that could be a huge win for the portfolio both financially, and from a sheer cost of providing customer support across a portfolio. We have 1 full time customer support person. She is awesome, and I don't think tools like this will replace her, but perhaps we could now have her handle 2x the amount of requests she does in a day with the support of practical, functional AI.
The AI bet
We don't have any bets in AI at the moment. Your's truly is an OG AI guy. I spent 6 years doing computer vision stuff. It was cool, but not as cool and not as practical as these LLMs like Open AI and now Bard. The more I explore these LLM enabled tools, the more I feel like "this time it's different".
We will be making several bets in this space. This is our first. We have 2 others we have built that we will be announcing shortly but for now, consider Support Guy our entry point into a product that delivers a truly AI first experience. There will be an ungodly amount of value created with bolt on experiences to existing apps. There will also be an ungodly amount of value created by re-thinking existing apps from the ground up as an AI first experience. Think TikTok vs Instagram. TikTok and it's "algorithm" were a truly AI first experience vs Instagrams' feed which is comprised of people you follow.
Support Guy is an AI first experience, you immediately talk to a chat bot, and get an actual answer to a question instead of a link, or a we'll get back to you in 24 hours. There are still plenty of issues with the tech now, but long term, these AI first experiences will win and I believe our (humanity's) collective productivity will increase because of it. It's also just sometimes better to be fast than to be 100% accurate :)
I'll probably compile these notes into a course at some point. not so much as a revenue thing but just as a nice thing for people to come and more easily learn from. I was aware enough this time to go through and document as it was happening exactly how we handle transferring all the assets.
The part I didn't record was what a nightmare stripe was to migrate. In this case we had an account from India and Stripe doesn't let you transfer those accounts so we had to manually export the customers from the first account, add them to the second account, then go back and update our database with all the new stripe customer IDs. This took a few hours.
Then of course I broke production (not totally this time, just the chatbot itself) for a few hours.
At this point we're the proud new owners of Support Guy and want to thank Shri for building 2 awesome products in the XO portfolio!
Onward and upward!