As a serial entrepreneur, Zach Mangum, CEO and founder of tech company Pronto, has learned a few things about creating successful startups.
In 2010, when Mangum founded the software startup GroSocial, he set out to help businesses find customers online. GroSocial found so much success in providing this service to small and medium businesses that it was acquired by Keap Software, just a couple years after he started it. “That was a really exciting time for us,” he said. “Most of our team stayed on at Keap but after a couple of years working there as an employee ... I just got this itch to jump back into being a tech founder. Even though we were successful with GroSocial, it did not give me that warm fuzzy feeling I wanted.
I really wanted to build something that could make an impact on millions of people.
Following the success of GroSocial, Mangum, who has a finance degree from Brigham Young University, gathered a few investors who were willing to take a gamble on his next project. “It was certainly a lot easier to raise money the second time around, and there were people that knew me and felt like they could trust me − at least to a certain degree,” he said.
“We built one product and after about nine months or so, we figured out it wasn’t going to turn into what we had hoped for. We thought while we still have cash, let’s just move onto something else,” he said.
“Our team then started building a free consumer app, Bubble, that was centered on messaging. Our user base was growing every day and we had celebrities like NBA champion and MVP Steph Curry posting on Instagram about it. Bubble had pretty innovative features and it was a pretty fun app. We got some more investment dollars, and we were one or two board meetings into operating with the new funding when the data started to reveal how people were using Bubble,” he said.
“Teenagers loved using Bubble. And they would use it like crazy. Then we noticed we started losing the teenagers as our main customer base after about two to three months, but they were really good at getting other people to use Bubble. Our user base changed and people started creating group chats for their friends or used it to communicate with their soccer team, preschool moms, etc.,” he said. The company grew organically, but modestly, as users told their friends and groups about it, who then told their friends and groups about it, and so on.
“We didn’t do a ton of marketing, but we were shocked to find out that 71 percent of our entire user base was soon using our product for either school or work and not using our product for our intended purpose,” he discovered.
That data was really compelling.
With six employees working for six months, the team revamped the product and the business model shifted from a free app to software-as-a-service (SaaS) business for schools and businesses − and Pronto was born. Pronto bills itself as being a
“communication hub for everyday users and connects people via chat and video, so they can learn fast, work smarter, and communicate seamlessly,”
Based in Lehi, Utah, Pronto now has 34 employees and hopes to have 50 or more by the end of the year.
“We have found a lot of success helping higher-education schools and certain types of businesses where the vast majority of their employees don’t sit at a desk with a computer,” Mangum said. “These types of employees use their phones as their computer. For example, workers at grocery stores, construction companies, and other businesses where their main workforce is in the field and not behind a desk,” he said. “We were finding success and were able to attract investors and secured $7.5 million in a Series B round of funding in December.”
Then the coronavirus hit.
“We huddled up as an executive team and we decided we wanted to be a part of the solution to the madness happening with the shutdown,” he said.
“When the coronavirus hit, our team jumped into high gear to help schools and businesses that instantly switched to working remotely. Surprisingly, schools were the quickest to put together contingency plans and signed up with Pronto. We put together the tools to accommodate them and ensure that they don’t skip a beat,” said Mangum.
Pronto offered up free access to its services to any institution, free through the end of the semester, so they could finish the school year seamlessly and without the worry of figuring out how to pay for it. “We are there to help,” he said.
Within the first 10 days of the shutdown in March, over 1,000 institutions reached out to Pronto. In one week alone, they onboarded over a half-million students using the Pronto platform. And there are no signs of serious slowing. “We have seen a threefold increase in usage and traffic,” Mangum said. “It has been absolute pandemonium and stress trying to support that much of a business increase almost overnight. So, scaling our product up to accommodate the need has been a nice challenge for our product team and they’ve done a phenomenal job.”
“Our team is working long hours (and remotely, using Pronto!) to get as many schools and businesses set up with Pronto as fast as possible. Luckily, our product keeps our teams connected and there is constant chatter and communication between the Pronto teams as they work through the craziness, like so many other companies are doing.”
Mangum said Pronto is “frictionless” − easy to use without causing even slight pauses or head-scratching. “I could not imagine the time and manpower it would take if we had to train 200,000 students how to use Pronto,” he added.
“There are a lot of businesses and schools hurting right now, and if we can help ease that burden and serve them and help during this crazy time, we intend to do that. In the very beginning, we set out to build something that is going to impact millions of people's lives, and it’s fun to see that as a reality right now.”
That is a pretty good story. Maybe even a warm fuzzy one.