Seven years ago, Wade Foster, Bryan Helmig, and Mike Knoop had a hunch that people would want to make the apps they used work together in unforeseen ways. So the trio spent their nights and weekends building the first version of Zapier, a tool for making connections between apps and automating tasks.
Now, Zapier’s automation service is growing faster than ever with 3 million registered users, up from 2 million in January and one million in May 2016. Annual recurring revenue has also grown by nearly 50% since January, from $35 million to $50 million. The company, which is mostly self-funded and has been profitable since 2014, also recently hired its 200th employee; all of them work remotely.
Rather than declaring mission accomplished, Zapier is now preparing for a future in which automation is more mainstream. The company’s plans include smarter recommendations on what to automate, better educational tools for users, and possibly even new software beyond the core automation product. The hope, Foster says, is that Zapier will find its way onto job skill requirements in the same way that Office and Google’s G Suite have.
“50 years ago, people were employed inside of companies as typists, but now everybody is a typewriter,” he says. “I think today, we’re starting to see a little bit of that, where folks inside of companies are being the first to bring automation into the workplace, but eventually this is going to be a skillset that all of us are required to have.”
Zapier’s core product allows users to automate tasks that involve one or more online services. You might, for instance, have Zapier send you a direct message in Slack when someone fills out a Google Form, use an Excel spreadsheet to auto-update mailing lists, or save new sales receipts from Stripe into QuickBooks.
While Zapier isn’t the only automation service of this nature, it’s arguably the most successful. The service is free to try, but unpaid users can only create five automation recipes, or “Zaps,” and can only run them 100 times per month. Paid plans, which have fewer restrictions and allow more advanced automation, start at $20 per month. This approach, along with just a $1.2 million funding round in 2012, allowed Zapier to become profitable four years ago.
By comparison, IFTTT has raised over $60 million in venture funding for a more consumer-oriented automation service, and has spent years trying to build a business model around it. Stringify raised $6.3 million before it was quietly bought by Comcast last year for an undisclosed sum. Microsoft’s Flow is probably the closest to Zapier in terms of its business focus, but it only works with 222 services, versus more than 1,300 for Zapier.
Foster doesn’t think Zapier’s growth spurt this year came from any particular new feature. Instead, he believes it’s the natural result of Zapier’s work on integrating with different apps.
“We see a mass amount of knowledge workers who don’t have traditional technical skills continue to adopt Zapier, and use it to do things they couldn’t do before, things that were previously only available to a technical audience,” he says. “We’re tapping into this nascent demand that’s always been there, but that these folks never had the tools to use.”
He also suspects people are just becoming more familiar with automation as a concept. As an example, he points to the new Shortcuts feature in iOS, which lets users hit a button or ask Siri to trigger a string of actions across different apps. Apple’s endorsement of automation in its core product, Foster says, is a pretty good sign that the concept is starting to go mainstream.
“I think people are starting to really wrap their heads around what automation is,” Foster says.
Automating the masses
With its core product humming along, Zapier is now looking at ways to branch out.
One path might involve making the product more consumer-friendly, even if it remains an enterprise tool first and foremost. Foster imagines having users enter in the services they use after signing up–or perhaps having Zapier detect some of those services automatically–and then using machine learning to recommend useful “Zaps.”
“I think of it as similar to how Netflix or Amazon works, where when you use certain things, we kind of know what other things go with those apps, so we might focus on recommendations like that,” Foster says.
Zapier also wants to become more of an educational resource on productivity software in general. The company already has an editorial department, responsible for articles such as “The 17 Best Meeting Scheduler Tools” and “The 15 Best Email Apps for 2018.” (The write-ups, which are legitimately useful, often find a way to mention how Zapier might fit in.) Also in the works: a potential community platform where people can talk among themselves about the software they’re using.
“We have so many insights on how people are using software, and what software works for what types of use cases, that we can translate a lot of the adoption that we’re seeing into better recommendations for what people are using at work,” Foster says.
Perhaps most interestingly, Foster floats the idea of building more productivity software itself. Being a switchboard between internet services, Zapier gets some unique insight on which products are taking off and which ones are stagnating, and it could use that information to launch new tools beyond its core automation product. (A prototypical example might be Zapier’s email parser, which launched in 2013 and can intelligently extract text from emails. Foster says it’s seen “a ton of adoption” over the years.)
“I think investing in software ourselves, where we’re seeing gaps in the market where no products are serving those needs, is also an interesting area for us to look at,” Foster says.
Hearing all of this, it sounds like Zapier is becoming something greater than just an automation software company. Foster doesn’t deny it.
“I think our goal is to help everybody be more productive at work,” he says, “and so whatever mechanism that plays out as is certainly an area that we’re interested in.”