Wufoo Sold For $35 Mil. Here's The Story Behind Its Success. | Hacker News Reader

Wufoo Sold For $35 Mil. Here's The Story Behind Its Success.

mixergy.com

138 pointsmbansal1445 comments

5 years ago, if you've told me there was money to be made outsourcing HTML forms, I'd have called you insane. Today I probably still would. Goes to show that sometimes the things we think are so worthless that noone would ever pay for might not actually be so.

Where's there's pain, there's profit potential. Forms are pain. They are a pain in the ass to create and fill out. That's double pain - and double the business opportunity.

Yup. Spend any amount of time working inside a Fortune 500 and you see pain and opportunity everywhere.

There is huge demand in businesses big and small for "Let me actually get my work done without needing to talk to IT." (I suppose this is a subset of the larger opportunity, which is that a) almost all large organizations are pathological in at least one way and b) people do not enjoy dealing with the pathological parts, so they'll pay to avoid it.)

Wufoo solved a real problem which was persistently preventing people from making money or getting their work done. The fact that that problem is perhaps not the most technically difficult is not relevant, as dealing with it is still beyond the capabilities of about 99.95% of people who encounter it.

I wish there were a lot more Wufoos.

What other areas need a Wufoo?

I'll tell you one right now -

HIPAA compliant Wufoo. I've got a lot of medical clients who want to have patients filling out input forms before they arrive, but storing medical data is something I won't touch with a ten foot poll.

We use and recommend Wufoo anywhere we can. If I never have to code another form it'll be too soon.

I read through the electronic portions of HIPAA a while back, and I think that if you were to install a public web server in the doctor's office, run some type of forms engine on it, and use SSL, that you could get close to satisfying the IT portion of the requirements.

I think it would also be necessary to leave the customer with written procedures for managing server access.

Clearly this is very involved and not scaleable, but if anyone here is considering setting up intake forms for a medical office, take a look at OpenEMR, they just received modular ONC certification, and are soon to get complete EHR certification [1].

[1] http://en.wikipedia.org/wiki/OpenEMR#Certification

Wow, OpenEMR is still alive? I was one of the 4 original authors as a junior in high school. Open Source for the win.

Yeah, I was involved briefly in source. You've got to have your hip-waders on.

Awesome! I took a look at the source - it's unrecognizable from what we cooked up that summer. 4 high school hackers in a basement, making an EMR system for the "CEO"'s mother who was an internal medicine doctor.

There was some really horrific things in there - this was before I knew what a JOIN was, so I'm glad some of my shame is long gone.

Still, it's awesome to see that the project is still alive.

I've done a lot of work with OpenEMR, and this explains everything. heh

Completely offtopic, but seeing dozba on HN made my day.

I'm creepin', but I usually get downvoted to hell. Surprise surprise.

HIPPA is an immensely huge opportunity. I used to work for home health company in Las Vegas coding forms for intake, hospitals, follow-ups etc. was a pain. but any business that has to routinely create forms like colleges or law firms for example could benefit from attention being focused on them. I don't know if specialization is the right answer as far as business plan wise but expanding Wufoo's current line up to handle specific industries would be ideal

It's just tough to spot because there were already so many players in that space.

"Too many fish, not enough barrel" rarely kills startups.

Except in casual gaming and TODO-lists.

TODO-lists.

It's funny because it's true.

Mid 2008 I was thinking this was really something I should do. I'd just done some PITA work on bunch of legacy php forms for a client and I knew there had to be a better way and I worked out what I thought that was ...

... but, you know, I needed the income from my contract work and couldn't find the time, etc. Realisticly, I didn't have the skills or experience to compete with WuFoo but that doesn't mean I couldn't have made a better service than a number of others out there.

So my current idea, this one I'm gonna do, just as soon as I finish a few more contracts ...

I worked for a big company with multiple business process management product offerings. What did they use for internal processes? Survey Monkey or Excel spreadsheets.

I remember reading some good advice once. Anytime you see someone using Excel for something spreadsheets were not designed to do, there is a business opportunity.

it goes to show you, if you create something people want it's usually not that hard to make money from it, regardless of the competition in that space. The amount may not always be that high, but you can do well.

Mind-blown. What other menial web scripting will people pay a lot for I wonder.

The Wufoo guys just created a kick-ass product, they are really talented javascript and css engineers. Now it's common for a site to be streamlined with drag and drop interfaces, dynamic lists and the like, but a few years ago, those kinds of sites were hard to come by. Plus they are just cool guys, I actually found a bug in the site once, sent them a reference to the bug in their contact form and one of the team members sent me back a personal note about fixing it. Those are the kinds of finishing touches to a product that I think made Wufoo excel, albeit in a kind of weird tech space.

The terms of the deal are $35 million in cash and SurveyMonkey stock (which is privately-held). The article doesn't give the split between them. It's premature to declare this a success. It's not like they were bought in an all-cash deal or bought with Google stock.

Although I haven't watched the video: Why should the mix matter? If the deal was deemed acceptable by the team and their investors, I assume it's because the terms left them comparatively better off. The fact is, they have tackled a need, out-executed others in a certain space, and achieved an exit strategy (nothing wrong with them not wanting to do forms forever). That is a success.

Not everything has to be Google-level transaction to be declared a success.

Agreed. Eager to see the reasoning behind the 'mix' concept now.

Privately-held stock is riskier, because it's basically worthless until the acquirer has its own exit event. When you sell your company for stock, you're basically just trading stock in your company for stock in the acquirer. If the acquirer tanks before exiting, your shares are just as worthless as if you'd tanked before exiting.

Now, it can sometimes work out - I doubt Evan Williams is complaining about selling Blogger to pre-IPO Google for (presumably - terms were never disclosed) stock. But in other cases, I'm not sure the founders did so well - SixApart, for example, isn't quite the darling it was when it purchased LiveJournal in 2005.

The mix matters because shares in a privately held company are not very liquid, and fair valuation of those shares is sometimes problematic. In short, there's a decent chance the shares will be considerably less valuable than the terms of the deal might suggest.

That said, I do feel this particular deal was a well-deserved success for the Wufoo guys. My congratulations to them for excellent execution!

According to CrunchBase, they were founded in 2006, and they only took $18k in YC seed money (1/06), and $100k in seed money from Paul Graham and Paul Buchheit (4/06). Even if that $35 million was mostly stock, it would seem to be a good return.

They were running on revenue, and had grown to a team of a dozen people, or so, without raising any additional capital beyond the few hundred thousand they'd raised in the beginning...so, they were obviously comfortably profitable and growing fast. There would have been no reason for them to sell for anything less than a very attractive offer that took that growth into account. And, those guys are not stupid; they declined a number of acquisition offers in the past from companies wanting to do mostly-stock deals. I'm certain at least a significant portion of the deal was for cash.

Great story, another example of a YC success. One thing, i've never got Wufoo. I don't think they're providing a better solution in comparison to Google Docs and PollDaddy, far from a perfect market but I think certain things make the process too long.

They're prettier and easier to use, and the fact that you can pay for it makes many businesses feel better.

They are definitely better than Google Docs forms in several areas.

The main selling points of Wufoo over GForms in my organization were:

  - Payment integration
  - Branding
  - Customizable notifications
  - Form/Page/Field Rules
  - API
  - Ease of Use

We get all that, and the only difference in price is $29.95 a month. For a decent-sized organization, that is a paltry sum and it has helped us save time (probably over 100 hours) and improve our operations. It's been a fantastic value for us.

My daytime employer subscribes to Wufoo's mid-level plan and the experience has been fantastic. I was worried when they sold the experience might change, but so far it's been nothing but the rock-solid steady performance and smart feature enhancements we've had since day one.

I can't remember when, but not too long ago Wufoo sent us a hand-written thank you note for being their customer. It blew me away.

I second patio11's comment below: "I wish there were a lot more Wufoos."

Congratulations.

I had a Wufoo account but moved to Formstack since Wufoo cannot make any calculations and they plainly said they are not going to implement the feature; they want to specialize in ease of use I guess. I can't think of an advantage of Wufoo over Formstack.

Strange, the transcripts of the interviews are now delivered as google docs. I always thought it was just search-engine-fodder. Do some people really prefer to read the interviews?

Yes- audio is great for commute. But I can read the transcript in a fraction of the time. I do both depending on schedule, and like the option.

Most definitely some do.

Yes, I like to read the transcript. Mostly because it is faster to get through it, but also when I read the transcript I can Google names or thoughts in it. I also listen to the audio when I am on a walk or in the car.

Another point for transcripts is that most non-native English speakers will have a much easier time understanding written material.

There's a popular series of Ruby on Rails tutorial videos called Railscasts. Someone decided to textualize all of them--Asciicasts--because text has the benefit of being easily searchable.

For me, I went straight for the doc so I could a quick scan. I just didn't have the time this morning to read or listen to all of it. If I could do a sped-up listen through, I might consider it.

I would say in general having both an audio and text format is more powerful than just having one or the other.

I read significantly faster than you can talk, and I don't have tons of free time. Why would you NOT prefer to read an interview, as long as its transcribed properly?

Some people are hearing-impaired and need a transcript in the absence of captions.

I always read the transcript if it is available for interviews. It has to be at least 3 times as fast as listening.

Reply on news.ycombinator.com