8 July 2020
Growing a Digital Agency: How Exabytes grew their small hosting service from $0 to $10M in revenue within 10 years
This exclusive interview with Chan Kee Siak, CEO of Exabytes, talks about how he grew his business to where he is today.
You are reading the Business Development, Services and Marketing (BDSM) Blog. Named to reflect the punishing amount of discipline required to master the core tenets of the industries we service, we blog about current affairs, industry tips, tech developments and more.
20 years ago, CEO and Founder of Digital Agency Exabytes Chan Kee Siak set out to start what would become one of the leading web hosting companies in Southeast Asia.
He was just 19.
What began as something he did because he “had nothing to do” eventually grew into a business that earned almost US$10 million in revenue in 2018.
Today, the agency employs over 300 employees across Southeast Asia, hosts several 100 thousand websites, and also hosts about 1 million email accounts.
Novocall’s CEO and Co-Founder JJ Huang sat down with Chan to learn more about how he grew his business to where it is today.
Chan started his entrepreneurial journey selling computer hardware. When he needed a web hosting platform to host a site for his business, he realized that there was a lack of good ones. The web hosting industry was still young.
He capitalized on this gap and became a reseller for an American hosting provider. Since then, he never looked back.
While web hosting services still form the bread and butter the business, Exabytes has expanded on its portfolio of digital services.
Currently, it also provides cloud services, digital marketing solutions, call tracking services, and a series of tools that specifically suit the needs of small and medium enterprises (SMEs).
Young Business Mistakes
“We actually knew nothing about finance and accounting”, said Chan when asked about what his newbie mistakes were. “We didn’t pay attention to proper bookkeeping procedures, nor did we closed an account punctually every month and every quarter.”
It wasn’t until a Venture Capitalist (VC) went knocking on his door in the seventh year of business that he realized the importance of maintaining proper financial records.
After carrying out their due diligence in examining Exabytes’ finances, the VC realized that the accounts were wrongly done. Needless to say, investment talks fell through.
Since then, Chan has put in a lot of effort and resources into improving the company’s accounting and bookkeeping processes. This has definitely contributed to the growth of Exabytes.
Their drivers of business success
1. Exabytes pursued the correct business model
Chan said that many businesses fail because their business models were wrong. They prioritized Exabytes’ growth. But they prioritized massively on the wrong areas of growth.
Some businesses aim to grow their user base at all costs, putting off revenue generation to another time.
Pursuing user growth and generating revenue once you hit critical mass is indeed a commonly used strategy. But Chan mentioned that many businesses make the mistake of not checking their unit economics first.
Many businesses create products to grow their product offering to address business problems. But are they building something that the market really needs?
These form the fundamentals of your business model and you need to get them right.
2. They picked the right revenue model
Businesses need to get their revenue models right, and the type of model they use would have to be based on the nature of the business.
To Chan, the online recurring revenue through subscription model is the way to go for tech solution businesses.
The subscription model allows a single solution to be accessed by tens of thousands of customers anywhere in the world.
Unlike project-based services, you won’t start from 0 again once the period of use comes to an end. The business need will always be there and a simple renewal of the subscription is all that is needed to help the customer address the problem.
In that sense as long as you grow your client base, your revenue stream will increase steadily.
3. Their sales methods matched their business model
From very early stages in the business, Chan never felt that meeting a potential customer face-to-face was advantageous to him.
Back then, being a 19-year-old young entrepreneur, he felt that his youth would make him seem less credible to more experienced business people.
Even after having been in the business for a while, Chan stills prefer online sales, saying that it is more efficient. The traditional way of selling – arranging a meeting with a lead, conducting a demo, follow up with emails that may not guarantee sales – takes up too much time.
4. Genuine Customer Service
Chan mentioned having values as businessmen, and businesses should always “do the right thing”.
Despite providing subscription plans with relatively low monthly prices, Chan focused heavily on providing top-notch customer success to his customers.
Being genuine and sincere in helping your customers achieve their goals can go a long way in creating long-term customer relationships.
Businesses need to constantly remind ourselves that our customers aren’t just a statistic. They are human beings with genuine problems who need our support.
Even if the answer to their queries can easily be found on your website’s help center, we must always provide our fullest support. Exabyte clearly lives by this principle.
How Exabytes Grew Exponentially
1. Biggest Lead Acquisition Channels
It is important to pay attention to the specific profile of your target audience.
“Different products and services are different in nature and hence have different target audiences and channels they go to look for information,” says Chan.
For Exabytes, they serve mostly SMEs who are looking for specific solutions to their business problems.
Naturally, lead acquisition channels are different from businesses that serve MNCs or even other SMEs that require different solutions.
In terms of lead acquisition through digital marketing, Exabytes actively uses Google Adwords, SEO and content strategies, social media, and newsletters.
Today, Chan says that Exabytes has affiliate programs and partnership programs too.
2. Building Strategic Partnerships
Chan emphasizes the importance of building partnerships with companies that excel in what they do.
He realized early on that many of his customers may not be well-versed in the complicated tech solutions they may need. As his business grew, his customers started requesting for more help in building websites, and even marketing their websites.
That was when he started looking for partners to bundle their products together to do cross-promotions.
Chan mentioned that the easiest way to find partners for your business is to find complementary businesses.
For Exabytes, they were providing web hosting and domain services. From a customers’ perspective, they are purchasing Exabytes’ hosting as they want to build a website for their business.
Naturally, they will also require website building products or services. After building their website, they will require marketing tools and services to market their online business.
No matter what type of product or industry, all businesses will have upstream or downstream products that will fulfill the entire spectrum of needs for their client. This is where how one can easily identify partners to work with.
Future of the Marketing Industry
“The online world is the cure to the financial impact created by the pandemic”, says Chan on the future of the industry.
A lot of things have changed in the last two to three months because of the COVID-19 pandemic. Even daily activities like grocery shopping have found its way onto the world wide web.
In fact, many other businesses such as food and clothing retailers, and even event organizers have gone online as well.
Chan mentioned that in the last few months, the time taken to make a purchase decision has also decreased significantly. Customers “sign up almost instantly”.
He also said that he’s hearing a lot more customers talking about how their management teams are stressing the “immediate need to digitize”.
What’s Next for Exabytes
Right now, Chan and his team are focusing on webinars.
Not only can they use this to improve their virtual conference management ability, but they can also use their expertise to help customers manage their webinars.
In terms of partnerships, Chan is focusing on building stronger relationships with financial institutions like banks and fintech companies, as well as all SME community associations.
He hopes to be able to use Exabytes’ expertise to help SMEs embark on a journey to transform digitally.
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