From Chaos to Category: Dovetail’s Rise in the UX Research Landscape

How Dovetail created a new SaaS category while growing to a $970M (Australian) valuation in 5 years:

(I learned the details by having a chat with 4 members of their team, and 4 UXR leaders.)

To learn about the complete story and breakdown, check out the deep dive here.

1. Product-led growth, design-led company

While Dovetail’s culture is design-led, its business model is decidedly product-led growth.

The company relies on the product, & inherently viral features like research reports, to:

• Acquire
• Convert
• Monetize
• And retain users

2. Creating a hub for a neglected persona

Let’s go back to 2016. While:

• Engineers had JIRA
• Designers had Sketch
• PMs had Confluence
• Analysts had Tableau
• User Researchers had… nothing?

Their workflow was a chaos of switching between different software and tools.

Ben had lived it as a product designer at Atlassian.

While there were many softwares focused on how to build, there was almost nothing about what to build.

So, after validating the idea with an MVP, he recruited his Atlassian Engineer friend, Bradley Ayers, to join him.

3. Mastering the PLG motion

Dovetail excels in all layers of PLG:

→ Acquisition: they don’t use any outbound sales

→ Core problem: the home page emphasizes on improving your product decision-making

→ Reduced friction: its onboarding is focused on a standard walkthrough

→ Activation: an intuitive product, examples & templates

→ Retention: as a system of record, the product gets stickier as more data is put in

→ Monetization: free plan has unlimited functionality, but 1 project

→ Expansion: natural growth of free users, who become editors

4. Creating powerful, reinforcing growth loops

Dovetail has 2 primary flywheels:

• More paid seats help them build a better product, which helps UXRs succeed, which drives more UXRs & paid seats
• UXRs succeed, driving collaborators to join, which go from free to paid seats

As well as 2 secondary flywheels:

• The more paid seats, the more it can invest in inbound sales
• The more free seats, the more expansion products like Channels (to analyze customer support data) it can build

5. Building towards a category of one

Dovetail is building out its own category even though there are competitors in the research insights space

It’s not quite transcription or a hub for research. It’s that and more.

This has helped it create a new category in SaaS.