Contrarian by Design: Wade Foster’s Vision Behind Zapier’s $5B Business

Founded in 2011 in the distinctly non-Silicon Valley location of Columbia, Missouri, software integration company Zapier hit profitability in 2014. Today, the company is valued in the billions, and is poised to keep thriving as AI becomes a normal part of everything we do online. My guest on this episode of The Eric Ries Show is co-founder and CEO Wade Foster, whose ethos from the earliest days on has been: “If you're going to try and build a company, don’t do anything that doesn’t matter.” For Zapier, that has meant staying as close as possible to customers from the start in order to build a product they really want. It’s no wonder their journey to product-market fit was easier than most founders can ever dream of – a story Wade tells in the episode that involves the magic of an early adopter and a lot of hard work. From that customer delight, the company was able to build a flywheel and growth engine that have kept it steadily growing with minimal outside investment ever since, a path it fully intends to stay on. As Wade told me, they’re “willing to sacrifice a little bit of revenue for the durability of these customers over the long haul.” We also talked about how the company maintains its culture now that it’s expanded to 750 people, all of whom work remotely, and why product and marketing aren’t actually separate functions, especially at the beginning of a company’s life. Other topics we touched on include: • Not taking Silicon Valley wisdom at face value • How he knew he was meant to be an entrepreneur • The fear of being overtaken by a competitor and how to live with it • Zapier’s “second founding” • Building products with AI in mind • Wade’s favorite Zap • And much, much more — Brought to you by: • Mercury – The art of simplified finances mercury.com/?utm_source=eric_ries&utm_medium=spons… • DigitalOcean – The cloud loved by developers and founders alike try.digitalocean.com/eric/ • Neo4j – The graph database and analytics leader neo4j.com/eric/ — Where to find Wade Foster: Where to find Eric: • Newsletter: ericries.carrd.co/ • Podcast: ericriesshow.com/ • X: twitter.com/ericries • LinkedIn: www.linkedin.com/in/eries/ • YouTube:    / @theericriesshow   — In This Episode We Cover: (00:40) Introducing Wade Foster (06:33) The transition to Silicon Valley and defying received wisdom (09:18) Where the courage to do things differently comes from (14:08) The internship that made him realize he was an entrepreneur (17:07) The value of staying close to customers during product development (18:07) The genesis of Zapier (21:24) How Andrew Warner became Zapier’s first customer (24:43) The company’s ease in finding product-market fit (30:03) The early days of company-building (31:55) How they stayed small and worked with a single million dollar Series A raise. (32:48) Reaching profitability in two and a half years (34:50) On not buying into the need to burn cash and hire quickly (36:44) The unique power of the company’s distribution engine (39:25) Zapier is a classic Lean Startup story (41:14) How the company discovered its growth engine and validated its growth hypothesis (43:30) How Zapier’s flywheel works (47:46) The problems of over-funding and monetization (49:25) Building and maintaining trust (1:12:25) Zaper’s “build principles” (1:00:39) The power of story-telling for sharing values (1:04:57) Wade’s thoughts on and excitement about how AI will affect Zapier and work (1:10:34) How AI has spurred Zapier’s second founding (1:13:30) The vertigo of evolving beyond the founder-entrepreneur role (1:15:24) Lightning round – including Wade’s favorite Zap! — Production and marketing by penname.co/. For inquiries about sponsoring the podcast, email [email protected] Eric may be an investor in the companies discussed.