Can Less Be More in CRM? Exploring Parma's Unique Strategy with CEO Mark Kofman

Transcript lightly edited for spelling and punctuation. The conversation is unabridged.

Mark Evans: Hey. It's Mark Evans, and you're listening to Marketing Spark. When an entrepreneur tells me that they have no competition, a, I don't believe they do, and b, I question whether they're eternal optimists or have their heads in the sand. Every SaaS marketplace is fiercely competitive. And this is particularly true in the CRM market where there were 1,383 players in the US in 2023. Nevertheless, the CRM ecosystem continues to expand. A company that caught my eye recently was Parma, which positions itself as a minimalistic and relationship-centric CRM. As someone who helps B2B SaaS companies with brand positioning and go-to-market strategies, I was obviously curious about Parma and how it's working to establish a foothold in the CRM market. And I'm excited to talk with Mark Kofman, Parma's co-founder and CEO. Welcome to Marketing Spark.

CEO Mark Kofman: Hi, Mark. I didn't even know we have so many competitors. I thought it's couple hundred, but I bet you're not wrong because every day I find a new CRM on the market. And I was like, 'I haven't heard about you before.'

Mark Evans: The question that I've got to ask, regardless of whether there's a couple hundred competitors or 1,400, why would any entrepreneur launch a CRM company? When you look at the opportunities out there and markets where there might be less competition, you and your co-founder decided that I'm gonna enter the most competitive market possible. Why would you do that? Are you crazy? Did you see an opportunity? Explain the rationale for doing what you're doing.

CEO Mark Kofman: I'm not sure it's rational. I probably need to tell the story how I got here. So the previous company what I've been working on was a CRM data migration company, Import2. So anybody who's in the CRM space, they might have used us when they buy a new CRM product, and we would help businesses to switch old data from old system to new one. So while building Import2, what I was noticing is you have customers who are switching the CRM in the search of something more simple, something more streamlined, something which will make their life easier. On the opposite, if you look into the CRM market itself, all the products, almost everybody is doing exactly the opposite. Let's add more features. Let's add some new products. Let's turn, if we're just doing CRM, like, how about we also do help desk? How about we also do marketing platform? Let's do integration platform. And then it was just an idea, 'Oh, what if we do what everybody else is not doing? Let's try to remove features instead of adding features. Would there be an interest?' And so this was a spark-style idea. And then we started to talk about it, and that started to make sense, and it resonated with a lot of people. I have an engineering background, so, like, I immediately started to imagine what kind of product, how it could look like. But that's, I think, how this whole idea started.

Mark Evans: It's an interesting situation because I work with a lot of early-stage B2B SaaS companies, and many of them don't have CRM. They're using Excel, and they're exploring. They need to adopt a CRM, and they often come to me and say, 'What should we use?' And there's the obvious candidates. There's HubSpot. There's Salesforce. There's Zoho. But you're right. It's, they are massive and often expensive propositions. And my thing was, there's got to be a simple CRM. There's got to be a company out there that is just focusing on a very easy-to-use product, and that's why when I assembled Parma, I was really intrigued and excited at the same time. So maybe you can provide an overview of Parma, what it does and what it doesn't do, and how it stands apart from the competition, how you make it a distinct product that has a distinct value proposition.

CEO Mark Kofman: How we describe Parma, I think this is to explain it is that this is a minimalistic CRM product. So we have only three features. And this is for real. Right? The three features are contacts, notes, and reminders. And we don't have anything else. Our list of what we don't do is actually huge. We don't do, like, literally anything with if you look into HubSpot or if you look into even smaller Simplicio. We just don't have anything of those features there. And that's the explanation of the product, but that's also our differentiation. And because we don't have those extra features, we obviously lose out to competition in some complex cases where it's a big business with professional sales teams. They would go and choose HubSpot. But there is a market where people are, they have a business. They have customers, but they don't have professional sales and marketing teams. And all they need, they just need to remember their customer, remember their face, and just keep some notes of what has been done with that customer over time. In that case, notes and reminders, that's all you need. And my belief is actually that's a huge portion of the businesses, and I think they're completely underserved. And that's why tools like Notion, Monday, Excel, or Google Sheets, that's why they're so popular because they just give you a small subset of the things, and you can build the CRM with some basics. But I think there's still why Excel is not enough. For example, in Excel, it's pretty much impossible to do proper reminders. And you pump some data into an Excel sheet, and then you're forgetting about those people. And then it's hard to track the history of the relationship with that person in one line. So you need some kind of, like, a note-taking simple feature to remember, 'Oh, that was the thing I thought about when we discussed with this customer this idea, like, five years ago.' And in Excel, it's pretty much impossible. So we're, like, I would say we're much closer to Excel than to Salesforce in terms of, yeah, in terms of functionality, but it's still relationship management product. It's not the generic purpose, 'Do whatever you want.'

Mark Evans: Seems somewhat sacrilegious to have a no-frills product that only has three features because the normal journey for software companies is that they establish their product. They build development teams, and then you've got to keep those teams busy. And so as a result, they continue to add features even though they might be features that no one asked for. And the features that they do introduce may not get used, but nevertheless, you've got an asset that you've got to take advantage of. And a lot of, obviously, a lot of companies get feature creep or they just become overwhelmed with features and it becomes a big mess. I want to ask you about how Parma does marketing and what challenges you face when you're positioning the product as minimalistic and you're battling competitors that are feature-rich, have bigger, more powerful brands, have brand presence. And when people think of a CRM, obviously, top of mind would be HubSpot or Salesforce. That's a huge marketing and sales issue. But as you mentioned, Parma is not for everybody. It's for specific types of users. How do you identify the users that would get the most value and most utility from Parma? And then how do you market to them at a time when other companies are saying, 'We can do anything you want' and have the marketing budgets to, you know, have a huge presence everywhere?

CEO Mark Kofman: That's a billion-dollar question. I wish I had a solid answer for that, but that's work in progress. So we just launched the product to actual first users early this year, and we're learning as we go. I think the opportunity of having any simple product opens up some different angles that are not available for other products. So for example, when you're setting up Parma, we don't require you to work with a consultant. You don't have to hire an agency to help you out, which is pretty much a standard nowadays if you buy any old-school traditional CRM. You would have to start with an agency. And what does it mean? We immediately cut off agencies and consultants as a channel who would recommend us because they cannot make money on top of us. But knowing that's not a channel, we are thinking about how users would recommend the product to their friends. So we do a lot in terms of collaboration with our users, building relationships with them, making sure we are available, and making sure that they're happy with the product. And if they're happy with the product, they will go and become our champions to the world and explain why we're different or how we're different. Or they will attract similar businesses themselves because they are working in that environment and community. So I can give you another example of how our overall business strategy attracts different channels. From almost the first month when we had users, we started to work with small developers interested to build different add-ons for Parma. And there's nothing unique in building developer partnerships, but big CRM companies, they attract developers by having a huge audience so they can promote their products to the market of, let's say, HubSpot or Salesforce. The reason why developers come to us and say, 'Look, we have the API, which just has five methods. Super simple. You can build an app in a day.' And if you go and try to build an app for any other CRM on the market, that would take you a month. And then we say, 'Build a small app as you want, a small integration, or anything which is of value.' It's a very low investment from your side. But if your app is valuable, that will bring you a market and an opportunity. So we are offering the simplicity not just to our users, but also to potential developers and partners who would be building something on top of Parma.

Mark Evans: Wanted to take a step back here and focus on the early adopters, the people who discovered Parma. Love the simplicity and how it is minimalistic and how it does meet their needs. There's a lot of talk within the software industry that your first 100 customers are probably your most valuable. Those are the ones that you'll learn from. They'll learn from you. It's almost like you're co-developing the product because they feel vested. They feel like they've taken a leap of faith by adopting a new product. And in return, you're going to give them amazing customer service. You're going to treat them VIP customers. And if you've got those first 100 customers and they become marketing and sales evangelists, then it makes it easier to grow and scale. What did you think about that approach when you were launching Parma? And what are some of the different ways that you've been able to leverage that community to encourage them, to engage with them, and to bring them onside as, for lack of a better word, allies as opposed to customers?

CEO Mark Kofman: We definitely thought about this from day one. And Parma itself, we are not a traditional, like, sales management tool, what CRMs are about. We are about relationship management. So we use Parma ourselves to keep track of our customers. And the way we see customer relationship is not about sales pipeline. It's about working with the customer over a lifetime. And because we had this approach from the beginning, we never thought about, 'Oh, that's a good lead. Let's convert them, close them, and forget about them.' Right? So from the beginning, since we had a customer, we created a profile in Parma. We collect all the feedback what they had in Parma in a simple note. And then that allows us, it's almost to have, like, a connection with the customer because everything is tracked in a single space, and our developers can come in, our product people can come in, and they see, 'Oh, that's the person.' We have a photo, by the way, of each of our customers in our CRM, and they can connect. Mm-hmm. And if you look into many other CRMs, they're trying to convert instead of connecting with their customers. And I think we're using the same names, and CRM is obviously customer relationship management. But in reality, CRMs are set up as sales management tools to convert leads into customers. But there's small attention paid. 'Okay, what's happening with the customer after they have purchased?' And the way how we looked into that is actually that's day one of your relationship. That's just the beginning when you start to build the relationship. That's when you have some engagement. And I think that has helped us. But I don't think it's technical. It's more of a mindset thing. So we are thinking about our customers and trying to think, 'Okay, how we can prolong this relationship for longer instead of how we can convert them or close them at a better rate.'

Mark Evans: I like the fact that you mentioned that the sale or the transaction is the beginning of the relationship because the way that I look at B2B SaaS marketing is that there's a huge emphasis and a massive investment on attracting, engaging, and converting prospects into customers. But after they come on board, it's almost like customers are taken for granted. The deal has been done. You've won them over, and then you don't do a lot to engage them or educate them other than perhaps a monthly newsletter, which is mostly about self-promotion about this is the updates that we're doing and the events that we're attending. And I think a lot of companies, that relationship that loses its mojo, it just becomes stale. And I think a lot of customers feel some of them feel that they're ignored, and I think that's a major cause of churn within the B2B SaaS industry. Wanted to get your thoughts on what type of marketing that Parma has done since the launch or even before the launch. And as an early-stage company, growing your user base and trying to drive brand awareness, are there things that you've leaned into? Are there experiments that you've tried or different approaches that you've embraced? Mm-hmm. That almost reflects your minimalistic approach to the product itself. I'm wondering if there's a connection or an ethos that encompasses the way that Parma does business from a sales, marketing, and product development point of view.

CEO Mark Kofman: That's a difficult question. Let me try to unpack it. So one of our key principles and cultural beliefs inside our team is that we want to do less, but whatever we do, we would do it well. In product, it's very obvious. Right? I've already talked about less features, and that gives us an opportunity to focus on those three features instead of building everything. But we are doing the same in marketing. So unlike, and I might be wrong, but the way I see traditional marketing, like, 'Oh, let's set up 100 campaigns. Let's try this and that.' It just doesn't matter that 80% of those campaigns will not work, but something will stick. And that's why everything what you get out of the company, it's low-level quality. And because they can't focus on 100 channels very well. And with Parma, our idea is, 'Okay, let's do something small. Let's not do too much stuff in the beginning, but let's try to focus on this very well.' And today, the things what we are doing, the key thing is talking about our positioning, our story, our differentiation. You will see that there's, like, a lot of those elements. What I'm talking on the podcast today or when I'm posting on LinkedIn, when you'll see anything which is coming out of Parma as a company, you will see that's a big important piece. We're reminding why we exist, what we are trying to build, how we're different. And that's the thing what, I'll be honest. We've probably spent a year until now trying to craft those small words, playing with different ways how to say the same thing but in less words, how to say it so it's more clear, so it's resonating, and so on. And while we were working on this, we haven't done anything else. We just worked on that. And after that started resonating, we started to focus on other things. And today, my biggest focus, in addition just to the messaging part, is actually our developer partners. It's counterintuitive to do that in such an early phase, but I think that's going to be long-term a huge winner for us. Because if we build an ecosystem where it is easy for other people to do something on top, something nice to attract them, they will be the ones who will, in addition to attracting their products, get attention to Parma as a platform as well. And there's a lot of hidden stuff which are hard to see for you. But let me bring you an example. When we work with a developer, I would tell him, 'Look, I will be your product manager if you want. I'll come to you. I'll talk to you with all the scenarios. I'll help you with working on that. We will give you our designer, and this designer will work with you if you want to help you build screens, to help you build some nice screenshots and everything.' I have not seen any other platform do such massive help to the developers. And for us, it's simple because we know our product, and we know what our users want. For us to help the developer who is catering to the same user base as ours, it is actually simple. But from the developer perspective, it's, 'Wow! I can save so much effort because they're helping me with some things which I'm not good at.' And this kind of small things, which are going to benefit over the long term when they add up. But this is just one example of those things, what we do behind the scenes, but which still spreads the message very well.

Mark Evans: Yeah. I love the idea. As I said earlier, I spend a lot of time, too much time thinking about brand positioning, working with clients from the get-go to articulate and differentiate their brand positioning and the fact that this seems to be a major focus for Parma and that you spent a year trying to refine and perfect it. It's really a great case study in the importance of brand positioning for early-stage companies because as I said off the top, every market has fierce competition. And if you can't differentiate yourself even in a small way, then you're going to be just like every other company out there basically selling the same product with the same features and benefits for the same price, and that's a very dangerous place to operate. So I give you guys complete kudos for embracing an against-the-grain approach to positioning, but, nevertheless, it's, I think, one of the lessons here is that you own it. You own this position. You can rally around it. You're going to either succeed or die trying using this positioning. But my advice to any entrepreneur, CEO, is that positioning matters, and it will be your competitive edge. It will underpin what you do from a marketing, sales, product development, HR, capital raising perspective. I would say that Parma is a really great case study in terms of the power of brand positioning. One thing I did want to ask you in terms of your approach to marketing, and this is something that a lot of companies have tried, is AppSumo. So when I was doing my research and I've bought products off AppSumo before. When I was doing my research, I noticed that Parma was on AppSumo. The deal, which was a great deal, had expired. And I think a lot of entrepreneurs who are familiar with AppSumo exploring the idea who have used it would be interested in your experience with it. Did it work for you? Why did you do it? Why did you jump on that platform? And for people who don't understand AppSumo, it's basically a marketplace where you can offer your product at a deep discount for a limited period of time, and the idea is that they'll use their brand, their marketing to get new users in the short term. There's obviously a cost to be paid, but it does give early-stage companies a boost if they need it in some ways. Can you talk about why you used AppSumo and did it work for you?

CEO Mark Kofman: AppSumo worked very well for us, but I don't think they worked for us for a reason because of their business model or because the way they are building the deals. The reason why AppSumo was a perfect match for us for launching the product is that they are targeting exactly the same audience as we are. So if you think about users who are buying in AppSumo, these are not, like, Fortune 500 companies. Right? These are freelancers, consultants, pretty much various solopreneurs. And this was one of our key drivers of early growth: people who are professional at their own craft, but they are not professional salespeople. They are not somebody who would need two complex tools, and that's what's for us. AppSumo is an amazing way to get right in front of the audience who we wanted to get in front of. I would say I wish they would have a different business model. Right? Because this lifetime deal plus the way how this is all done, it doesn't promote long-term relationships with those type of customers. But at the same time, everybody has their own way of building the product. So no matter that, for us, it was an amazing match of the audience. If it would be a different audience, I don't think it would work for us so well. We've got a huge interest in terms of, like, number of first users who came from that, and AppSumo was literally the first people who came to our platform and started to try the product. And I remember the first days, people signing up, starting to use, and they uncovered nasty bugs in the platform, which, 'Oh my gosh!' 'How could it work?' And by the end of the campaign, the product was already so much improved, and we got completely different feedback. But that's the reality of launching early. Right? You just learn on the way. 'Oops. The door doesn't close well. It's weak. It doesn't suck.'

Mark Evans: Better done than perfect then.

CEO Mark Kofman: This fast.

Mark Evans: No product is ever going to be perfect. And if you wait till it's perfect, you'll never launch anything. Thanks for the advice on AppSumo. I think a lot of entrepreneurs, early-stage entrepreneurs who are looking for traction should explore the AppSumo experience and figure out whether it makes sense for them. Obviously, for Parma, there were a lot of positives, a lot of learnings along the way. Obviously, the opportunity to improve your product as part of the process obviously had huge benefits and has helped the company since your trial with AppSumo ended. I want to shift gears a little bit and get your advice on what you would say to entrepreneurs who are looking to enter the B2B SaaS space with a new product. What are some of the considerations that they should focus on before they get started in terms of, is there a need for my product? If there is a need, how much competition is there right now? What are the openings or the opportunities that they can pursue or gaps in the marketplace? And how do they differentiate themselves right from the get-go? There's a lot of things to think about. I guess it boils down to: is the product needed? Is there a different approach that we can take? And how can we differentiate ourselves right from the beginning? What advice would you give entrepreneurs who are looking at a space and going, 'I think I want to do it,' or at least I'm exploring doing it?

CEO Mark Kofman: Yeah. Don't do it. To be serious, there are different approaches. And I think a very common approach is, 'Let's analyze, let's talk to a lot of customers, and let's do some customer development and figure out the market before building the product.' I like the idea. Right? But there's only a certain type of business that you can build by asking people upfront if they would buy it or if they would use it and so on. I would honestly encourage to do the opposite. I would say, if you have a spark, if you have an intuition, just don't overthink and just do it. Just simplify it in terms of how to get to the market fast and just launch it.

Mark Evans: Mm-hmm.

CEO Mark Kofman: I understand the value of learning the market, like, before analysis, it's just, in many cases, I see when entrepreneurs go that route, they spend five times more in analyzing the market than it would take them to actually build this minimum product that they can launch to users. 'Look, that's what I've built. Would you use it or not?' And maybe it's because I have an engineering background, and for me, building a product is easier than marketing it. But I think it's just a convenient way of procrastination instead of going and doing something, like, you analyze it and you're talking to people about this, and then you're collecting the feedback, and you're doing some graphics, or you're doing some statistics. Sometimes if you have an intuition, then just follow it. Right? But that would be my advice. If you feel you want to do it, there must be something that connected in your head that means you should do it.

Mark Evans: So it's a Nike advice: 'Just do it.' That's an option. 'Don't think. Just do.' One final question. I tend to source most of my podcast guests on LinkedIn despite the fact that I get inundated with people pitching me podcast guests. Curious about your experience with LinkedIn. You've got a presence there. That's how I discovered you if you may have commented on a post or I may have seen one of your posts. How are you finding LinkedIn as a platform to drive your personal brand awareness for Parma and lead generation? Are you seeing traction there? Any advice that you would give B2B SaaS entrepreneurs who are already on LinkedIn or thinking about embracing the platform?

CEO Mark Kofman: LinkedIn, I think, is for us one of the key places where we have conversations with our customers, but also important people who are not yet our customers. I was actually surprised how effective it is. And the only thing what I was missing on LinkedIn before is that you need to post, and you need to post regularly. And if you do that, you will start getting into conversations with other people. You'll start getting into some arguments, you will get into that community. And I think a very simple advice is, 'Just post as much as you can, and it doesn't matter what you post.' Eventually, you'll catch your voice, and you will see what people are engaging versus not. So that's something which I would definitely recommend. And especially, for example, when I'm looking now into potential partnership or into potential customers. I'll just go on LinkedIn, and I don't care about what they write in their experience. I'll just go and read what the posts are, what they are thinking about, and that gives me the biggest understanding. 'Okay, that's going to be something that is on top of mind for this person, and maybe that's what we can talk about. Or maybe that's how I can craft our offering better.' So I'd say it's a good way where you can talk about professional interests without sounding strange. If you do it in, I don't know, Facebook, Instagram, or TikTok, it's like it's not natural there at the moment. It might switch, but in LinkedIn, it just feels completely normal that you just talk about your work.

Mark Evans: It's been a great conversation. Love the minimalistic approach to product and love the fact that you've really focused on brand positioning and differentiation. Where can people learn more about you and Parma?

CEO Mark Kofman: About Parma, obviously, go to our website, Parma.ai. About me, find me on LinkedIn. We'll probably post the link, and I'm pretty open. So you can write me on LinkedIn. I pretty freely connect to people and then also disconnect freely as well. Okay. If you have any ideas or things you want to chat about, just send me a message or even better, argue with me on my posts. That's what I like even more.

Mark Evans: Great. Thanks, Mark, and thanks to everyone for listening to another episode of Marketing Spark. If you enjoyed the conversation, rate it, subscribe via Apple Podcasts, Spotify, or your favorite podcast app, and share it via social media. If you're a B2B SaaS company looking for more demand pipeline and revenue, but struggling to do marketing that makes an impact, we should talk about my fractional CMO and strategic advisory services and my 90-day marketing sprint package. You can reach out via email, mark@markevans.ca. Connect with me on LinkedIn or visit MarketingSpark.co. Talk to you next time.