Full Case Study: Calendly’s Journey to a $3B Valuation

Calendly is the fastest-growing company in the scheduling automation niche, and they hold 12.13% of the market share in the space (up from 8.35% in 2019).

Tope Awotona experiences ranged from cold calling for donations at a non-profit call center Awotona has grown frustrated with the long email exchanges leading to setting up calls with prospects. Tope spent six months analyzing the strengths and weaknesses of existing scheduling automation tools and ended up getting a flight ticket to Kyiv, Ukraine. Awotona launched Calendly’s MVP (Minimum Viable Product) in 2013,

How Calendly Attracted Their First 1000 Customers (2013)

Calendly’s Top 3 Success Elements ATTACH

three elements to stand out:

  1. Reduce the steps it takes to schedule a meeting using the tool (i.e. seamless UX and elimination of time zone related issues)
  2. Simplify design functionally and aesthetically
  3. Maximize integrations and facilitate their use
Figure 1: Using Calendly dictates sharing “calendly.com” links with outside parties

Figure 1: Using Calendly dictates sharing “calendly.com” links with outside parties

Calendly’s #1 Marketing Strategy: The Upside Down Funnel

their biggest focus was not acquiring users, but rather keeping them.

Calendly’s First 1,000 Users

The first Calendly users were members of a company in the Bay Area called BrightBites. After a discussion with Calendly’s CEO about his product, they started using the MVP (Minimum Viable Product) before launch.

And since BrightBites worked with educational institutions, it was not long before a school sign up for Calendly and started using it for parent-teacher meetings.

The biggest turning point that enabled Calendly to reach their first 1,000 users was when the school reached out to Calendly and wanted to roll out the product to 80 people.

Calendly listened and made it possible for individual accounts to invite team members.

Quickly, those teams grew into departments, and more users introduced Calendly to outside parties and helped Calendly reach their first 1,000 users.

The Best Decision Calendly Did NOT Make

Making Calendly a Business: Growing From $0 to $100K in ARR (Annual Recurring Revenue) (2014)

Striking a Balance Between Paid and Free Plans

Calendly tested several price points for different packages, ranging from $5 to $10 monthly per user, and ended up sticking to a free plan and a premium plan at $8/month billed annually or $10/month billed monthly. Plus, they had a 14-day premium plan trial option available for all new users.

The main features that Calendly monetized at this point were automated reminders, Calendly branding removal (Powered by Calendly), and personalized notifications.

Instead of grandfathering existing users, Calendly downgraded everyone to their new freemium plan and offered their new paid packages. Nonetheless, CEO Tope Awotona says if he had to do it again, he would upgrade existing users instead, as they have had some unhappy customer complaints as a result of that decision.

An Average Increase of $25K in ARR (Annual Run Rate) 4 Months After Monetizing Calendly

This has enabled Calendly to generate their first $100K in only four months, averaging a monthly increase of $25K in ARR (Annual Run Rate).

At this point (end of 2014), Calendly was making no profit and still was not able to cover their existing costs.

Reaching Profitability: $100K to $1M in ARR (2015)

Flexibility and Adapting to Customer Needs

With customer experience being a priority, Calendly invested their resources into fulfilling their customers’ requests and reducing friction points within the SaaS. They even based their segmentation on users’ behaviors and requests.

After watching many of these clients drop off when their requests weren’t met, Calendly had to create solutions to fulfill those special requests.

Revamping the Design to Meet Market Standards

Calendly had to get on that wave in 2015, and they’ve totally revamped their website, logos, and scheduling tool design.

Making Premium Plans Even More Appealing

To wrap up 2015 with a blast, Calendly had to continuously keep adding premium features to their paid plans to make it an even more appealing option.

From B2C to B2B: $1M to $4M in ARR (2016)

Automating the Customer Journey

After hitting the one million dollar milestone, Calendly had no option but to start following a low-touch sales model. The number of enterprise clients was increasing drastically against other segments, Calendly hired manpower to go full-on automated and decrease their users’ interactions with customer success in the future.

Team Scheduling and Administration

Administrator capabilities are another key element Calendly focused on at this phase. Admins were allowed to manage their teams on the platform, but allowing them to add and remove users, manage permissions, and more.

Enterprise Integrations

That is why they ended up developing integrations with tools such as Salesforce, GoToMeeting, and Zapier.

Moreover, they have enabled API integrations for companies to streamline functions and make Calendly easier to use across multiple cloud-based apps.

Recruiting an Inbound Sales Team

Calendly found itself in a need to hire a sales team.

Accepting Purchase Orders

With the emerging new segment of corporations, a new payment method needed to be introduced—purchase orders.

Taking Calendly From $4M to $10M in ARR (2017)

New Billing Plan to Maximize Revenue

By the start of 2017, Calendly realized they have a segment of companies that work with big budgets. This segment dominantly consists of companies that use Salesforce.

Positioning Calendly

Calendly hired dedicated product managers for each segment and started to roll out even more features.

Growing Calendly From $10M to $60M in ARR (2018-2020)

New Features & Segments

Calendly shrunk down its segments from ten to six in 2018. And to this day (2020), they are still targeting and working with the same segments.

Calendly & COVID-19

Seed Round Investment in November 2020

OpenView (a venture capital firm) decided to invest a sum of $550K into Calendly’s expansion on the 17th of November 2020.

Calendly Raises a $350M Investment in 2021

Along with Iconiq Capital, they have led the round to raise a $350M investment; which put Calendly at a $3B valuation as of the 25th of January 2021.

Takeaways

  • Keep your costs low.
  • Focus on the first 1,000 customers.
  • Customer is king.