Parlor's Covid-19 Update (With an Ask for Our Investors)
Hi everyone,
I hope this finds you and your families safe, healthy, and still at least a little bit sane. Seems like we're all navigating uncertain territory here, so I wanted to reach out to see how you were doing, give an update on how we're reacting to current events here at Parlor, and make a quick (but important) ask for each or you.
First, the quick ask:
Today, the team at Parlor launched a brand new free tool – our in-product announcements and feedback hub – and it's now live on Product Hunt. If you're unfamiliar, Product Hunt launches are incredibly important for software businesses like ours, and so we would love for you to take a moment to check it out, and if you're so inclined, show us some support there. We would also love if you would share it with any of your other portfolio companies who you think can get value out of more deeply engaging and communicating with their customers. Again, it's completely free, so all you need to do is send them to the Product Hunt listing, or directly to our site.
Today's launch represents 8 weeks of hard work from home focus by the entire team. More on our new free product below, but essentially it's designed to allow teams to share product updates, collect user feedback, and integrate 3rd party tools (such as live chat or an FAQ) into a single in app hub so users have everything they need in one place inside of a product. It’s also entirely brandable, so users won’t know the difference between our product and our customers'.
Now, an update:
We moved to entirely remote work on March 9, roughly two weeks before Massachusetts ordered all non-essential businesses to close. Fortunately, the first year of the company was spent entirely remote, so we were familiar with the organizational changes required to keep the team on track. We held on to our office space for the first month to see how everything was progressing, but ultimately felt like the current situation was going to extend into the foreseeable future. So, we renegotiated to end our lease early, which has saved us roughly $20k in rent. If anything, I think the team has been even more productive in this shift to remote work, so I think this was a positive outcome across the board.
As likely comes as little surprise, our sales cycles have completely frozen; most of the later stage opportunities we've been nurturing have put us on hold, and the last few weeks of outreach efforts have seen generally weak response. This seems to be common amongst the other startups I've spoken with, and we've been actively reviewing recent economic benchmarking surveys to gauge how C-19 is affecting companies like us. Prior to the US outbreak, we were in later stage conversations with a collection of large, reputable companies who would have acted as flagship, referenceable customers. I'm hoping we can pick up on those conversations after everything starts to return to normal, but we're adapting in the meantime by focusing on driving trial periods with any companies who are still open to exploring new technology. It's an uphill battle, but even a small number of new active users would be viewed as a win right now, especially given our early stage.
As far as Parlor's general economic security, we're in a healthy position, relatively speaking. We closed our ~$2.5M seed round in late Summer and have been purposely capital efficient in that time as we focused on building out the rest of the foundational product experience. We still have over $2M in cash on hand while maintaining a team size of roughly 15 employees. We've been able to keep costs low by focusing on expanding our offshore development team, and our ability to productively manage these teams continues to feel like a real competitive advantage. That said, I'm trying to be as thoughtful as I can in ensuring we're being measured in how we invest our resources during this highly insecure time. Specifically, we've adapted by cutting non-necessary marketing spend (e.g. paid advertising, SEO and content consultants, etc.) and investing those expenses into product development efforts instead to try to take advantage of this slow period by making notable improvements to our core product.
Prior to the depletion of the CARES Act relief fund, we were actively exploring if that stimulus package would provide support for companies in our position. I ultimately decided against taking advantage of that program, feeling that it was disingenuous for us to claim the funds were a necessity given our current cash. I want to ensure the long-term success of Parlor, but I also want to maintain my team's integrity in the process. That said, I will continue to keep an eye on where investments make the most sense as the situation changes. All of this aside, the most important takeaway is that, as of now, we do not expect to let any employees go during this time.
While this is obviously not a great period for anyone – and certainly not a secure time for early-stage startups – I do wonder if there is a silver lining here. We've been given an opportunity to focus single-mindedly on investing in some of the truly foundational and disruptive parts of the product which we may otherwise have continued delaying in order to release features which acted as requirements for immediately closing deals and securing short-term revenue. I still have my eyes on the big prize, and I'm hoping we can weather these short-term challenges and re-position the narrative by viewing this as a time when we can make real strides in our long-term product differentiation.
Typically, I would conclude an update like this with an ask from our partners, but since I've already done that above, I'll instead just ask that you all stay safe and try to enjoy as much time with your loved ones as you can.
Thanks again,
Keith