It’s well known that these days, online customer reviews are one of the first things a potential buyer peruses when deciding whether or not to make a purchase. But customer reviews are also becoming increasingly unreliable, and buyers more savvy in their ability to spot fake reviews. Every company needs solid, trusted reviews, and onsite conversions in order to compete.
Tomer Tagrin, CEO and co-founder of Yotpo, saw the way that fake reviews were harming businesses, and decided to take matters into his own hands and find a technical solution. Could a new technology platform be harnessed to determine the authenticity of customer reviews, increasing conversions?
The answer is yes. Yotpo has found new, highly effective ways for their clients to generate valuable user-generated reviews, with trust built in. On a mobile-first platform, Yotpo does email targeting, customer engagement, trust-based customer reviews, and much more including SEO and brand proofing.
I sat down with Tagrin to ask him about Yotpo, an Israel-based company, and where he sees his business growing after raising their latest $22 million round.
How did you start Yotpo?
I met my co-founder, Omri, when we were in college, both doing a dual degree in Electrical Engineering and Computer Science.
Omri was the smart kid sitting in the front row taking notes, and I was the troublemaker talking loudly behind him. One day he turned around and said, “Can you please shut up, I’m trying to learn here,” and I was floored. I thought “I have to get to know this guy.” We’ve been best friends ever since.
The idea for Yotpo came from a bad online shopping experience. I was buying a camera online and, since I knew nothing about cameras, I relied heavily on reviews to find the right one. I found what I thought was the perfect one based on the 100+ five-star reviews it had. When it arrived, I was certain they sent me the wrong one because the camera I got could barely focus. Then I realized, the camera wasn’t wrong, the reviews were -- they were fake.
That’s what inspired Omri and I to start looking at reviews. We began with the idea of eliminating fake reviews. We wanted to ensure their trustworthiness and authenticity.
Once we accomplished that, we decided to tackle mobile. Nobody was collecting reviews in a way that was mobile-friendly, let alone mobile-first (or, as we like to say, mobile-awesome).
When we checked that box, we began to look at the marketing potential of reviews. We started to integrate reviews into social marketing, search marketing etc.
Then we began to collect all forms of user-generated content like customer Q&A and customer photos.
How did you find the investors that backed you?
In the beginning, we took meetings with absolutely everyone. We basically talked to anyone with $10K in the bank and a working phone number. We tried to pitch people who had never invested in tech, and probably never would.
Luckily, the startup scene in Israel is pretty tight. We met one good guy, who introduced us to another and another and finally, we met a few angels who were excited or silly enough to put money into Yotpo. The community here is close-knit, so soon enough we got to know a bunch of different Israeli investors and later US investors.
We are big believers in getting to know our investors very well before they become a part of Yotpo. So we interact with different investors a lot.
We knew Adam Fisher, from BVP (who led this round), for almost 4 years before we even started pitching to Bessemer.
The same goes for all of the other investors like Innovation Endeavors, Marker LLC, Vintage Investment Partners, Blumberg Capital and Access Industries -- we got to know them as people as well as investors.
And I’ve heard that you are also expanding internationally?
We learned a lot last year when we opened our first US office, and truly became a global company. The hardest part is maintaining culture and communication between two branches on different continents. This is really difficult for two locations that are so vastly different -- for example, our NYC office is full of Americans and has a big sales operation, where our Tel Aviv office is more international and has way more developers than salespeople.
As a distributed company, communication and culture have to be top of mind in everything -- hiring, training, day-to-day operations. One thing that really helped when we opened our NYC office was the leader we chose there. The GM (now our VP of Sales) Tom Rotem, is a real entrepreneur on the ground and he does whatever it takes to help us scale.
We’re far from perfect, but we put a ton of work and energy into improving communication and making sure each office has the same shared values and culture. We’re taking what we learned there and applying it when we open two new offices this year.
Do you have any lessons for other CEO's from what you’ve learned running Yotpo?
I still don’t feel like I’m in a place to give lessons to other people, because I still have tons to learn, but one thing I think is really important is this:
The only way to scale is to improve hiring while simultaneously retaining your best people. You can consistently hire top talent, but it’s impossible to build a good, long-lasting company when the bucket is leaky, and you’re losing good people all the time.
The way we measure this is employee churn (e-churn = the number of people who voluntarily left the company/the number of total employees). Our goal is to keep this metric really low.
A lot of companies put all the emphasis on recruitment and hiring. Hiring the best people is just one part of the equation, you need to also keep the best people and let them grow inside the company.
