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Startup of the Week: Toggl

Welcome to the seventh edition of “Startup of the Week”  which features many great startups and interviews with successful business heads. This week, I have interviewed Alari Aho, the CEO of Toggl. I’ve asked Alari a series of questions regarding Toggl and also regarding tips for budding entrepreneurs. Have a read at what he had to say.

How did the idea of Toggl come about?

Well, we created the tool to solve our own problem – time tracking for a software consultancy we were running before starting Toggl. We needed a solution to help us track time spent on projects and better plan our future commitments. That’s how Toggl was born. We first created a no name internal tracking tool and after a year we realized it could be used outside of our company as well. So, in Spring 2006, we decided to roll it out as a product.  It took us three months to polish it and offer it to the world. We chose the name with the help of a random generator Toggl appeared 2 times in less than an hour, almost impossible to happen. It was quite surreal.

Alari Aho, the CEO of Toggl

Alari Aho, the CEO of Toggl.

Simply, what does your app do?

Toggl is the leading online time tracking tool for teams and solo users. It allows users to track the time spent on various projects and analyze productivity. It’s cloud-based and can be up and running from scratch in less than a minute.

Toggl in action

Toggl in action.

Did you have a business plan?

In my opinion, instead of using the word ‘business plan’, people should put more emphasis on ‘business fundamentals’. It means that you need to get the fundamental, core business basics right. If you have a good business model and a good product/market fit, then you can do quite a lot of mistakes in tactical planning or execution. You’ll have a solid margin of error. But, if your fundamentals are shaky, no matter how brilliant is the plan or execution – you still are fledging along.

So, we did not have a detailed business plan. We knew that we wanted to:

a) focus on few product features, and do them well

b) approach a narrow niche, but do it globally

c) use a freemium model to harness free users as a marketing channel

d) ask for a nominal monthly fee, but do it as a pre-payment to avoid debt collection issues

f) avoid linear correlation between our revenues and team size, business had to be scalable

What were the boundaries you faced when creating Toggl?

The major boundary was our own inexperience and risk aversion at the time. We started really slow, having only one full-time team member on the second year after creating Toggl. Looking back we should have been more aggressive.

“The major boundary was our own inexperience and risk aversion at the time” – Alari Aho

What is the difference between you and your competitors?

At Toggl, we focus on fewer features and as I mentioned – catering to a narrow niche of customers. We invest a lot in our company culture, focus on doing one thing really well and appreciate results rather than effort. I’m not a big fan of stupid effort. If you put in a lot of effort and end up with no tangible assets or value, you’re doing something wrong. Especially in a startup, effort never equals results. Our goal is to provide the best time tracker in the world and that’s where we invest our focus and effort.

What were you doing before Toggl?

We started as a software consultancy in 2000, we built products for other companies, banking and finance software, accounting, ticketing etc. Before starting the consultancy, I was a developer and made my first money from software development at the age of sixteen.

Toggl team hard at work

Toggl team hard at work.

What advice would you give to budding entrepreneurs?

Prepare for the long haul. Assume at least three years of pain when you start out with a new venture. You might be lucky and reach a solid product/market fit earlier, but don’t get your hopes up too high, assume effort rather than luck.

What is the one thing you think an entrepreneur should focus on that they may not find important?

I’d rather tell you what not to focus on – getting rich. Money is not the endgame, it’s just a tool.

Toggl's keywords and job page.

Toggl’s keywords and job page.

In one word, describe your job?

Passion.

Thank you

I’d like to say thank you to Alari for this interview. Have a look below at Toggl’s social links. Get in touch if you want your startup to be in the running for an interview.

Website: toggl.com

Twitter: @Toggl

Founded: 2009

People: Alari Aho, Krister Haav, Evelin Andrespok, Marek Tihkan, Angel Anton and many more!

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