Andrew Bialecki co-launched Klaviyo in 2012 to help companies access and segment data. Then a friend started a business on Shopify, and Bialecki saw the need to merge consumers’ ecommerce activity — browses, transactions — with email for personalized marketing.
Fast forward to 2022, and Klaviyo is a global email-marketing juggernaut, with 1,500 employees, $140 million in revenue, and $778 million in equity funding to date — including a $100 million round in August from Shopify itself.
But the management of data remains central to Klaviyo’s mission. “We’re really good a storing data,” Bialecki told me.
Klaviyo was a game changer for Beardbrand, my company. I reminded Bialecki of that when he and I recently spoke for this interview. The entire audio of our conversation is embedded below. The transcript is edited for clarity and length.
Eric Bandholz: Beardbrand has been a Klaviyo customer since 2016.
Andrew Bialecki: In 2016 our team couldn’t have been more than 20 or 30. Revenue was around a million bucks. 2016 was the year we started renting co-working space. Before that, five or six of us would go to a diner with those booths you have to slide and slide out of. We would all sit there and work. We thought it was cool. But we realized after a few hours it was super annoying if anybody had to get up. My co-founder and I finally said, “We better find some real office space.”
Bandholz: You launched the business a few years earlier.
Bialecki: Yes, we started Klaviyo in 2012. We began as a database company — a way to do segmentation for other software businesses. We fell into ecommerce and retail. A friend of mine was building his business on Shopify. It was very early in the open-platform movement — APIs for everything — with software to augment and improve the total package.
My co-founder and I had jobs at other software companies. We had banked a bit of cash, and tried to build a product ourselves for managing and storing data. When we raised our first funding round, I made a big mistake. We didn’t need the money. Still, we decided to raise a million bucks. We went to a venture capital fund in Boston, and they wrote us a check. It’s easier to raise money when proven that you can be a profitable, self-sustaining business.
We were building our platform for ecommerce and realized we needed to pull in transaction data. That started our partnership with Shopify. An ecommerce business needs software. One is a commerce stack, and the other is what we call the customer stack. It addresses where we store customer data and how to do messaging. It was a long time coming, but we wanted to help more ecommerce businesses.
We’re partners with Shopify and all the major commerce platforms. Our stance is always the same — we are good at storing data, pulling it all in one place, and making it fast and accessible. We’re good at messaging and marketing, too.
I’m a big believer in open source and integrated platforms. We believed from the start our product would be better opened and accessible. You can build a competitive advantage and allow folks to integrate that way.
Over the years, we’ve done much product co-development. Our partnership with Shopify was validating not just inside retail and commerce but even in other verticals.
We’re starting to branch out into entertainment, media, hospitality, and even restaurants and food service. We’ve had a bunch of folks, other commerce platforms, other transactional systems that come to us and say, “Can we do something similar?” It’s been fun, and I’m very appreciative.
Bandholz: You have 1,500 employees now.
Bialecki: Yes. I did all the engineering myself for the first two or three years. At the end of the day, when you’re building any product — physical or digital — you’re reliant on others. For example, we don’t run our own servers. We use a cloud provider. There are always some interfaces. But how do we set up a project where somebody can run it all alone? We had to figure that out, and now we’re a few hundred engineers at Klaviyo.
I recently read an article that said teams generally don’t focus enough on the overall goal. They don’t spend enough time on how they will achieve it and the different steps to get it done. That’s something that we’ve started doing. We use language around the office to stay on target. What are we trying to do? How are we going to do it? Who’s going to do it? We spend time talking through the processes. We’re not perfect at it. We have more learning to do.
Klaviyo’s mission is empowering creators to own their destinies. I love this idea of whatever that destiny is, whether it’s financial, how you spend your time, your impact on the world, or some product you think should exist — our goal is to empower them.
Bandholz: You do email and SMS.
Bialecki: Right. We think about messaging channels — email, text, and mobile notifications. We think about digital properties in terms of a plot of land. Everybody has a website. So why does personalization stop once you obtain someone’s email? When someone clicks from an email to a website, shouldn’t we follow through? We believe in moving from away transactional commerce where everybody looks the same.
We’re all used to using apps personalized to us. The same thing should happen to the shopping experience. A customer can decide how much personalization he wants.
We can do fun things by connecting our database with, for instance, customer service departments. If I’m returning a product, customer service should know my situation, and my past purchases, including my size and preferred style.
Bandholz: Where can folks support Klaviyo and reach out to you?