Case Study #4: From a Consulting Project to a Web Scraping Platform With $8M in ARR

Key Highlights:

• Built a solution they personally needed as web developers
• Prioritized simplicity by providing essential tools out-of-the-box
• Embraced open-source to engage the dev community
• Survived startup "shitshows" by disciplined prioritization
• Sustainable growth through bootstrapping and organic traction
• Final piece: strategic funding for aggressive expansion
  

Hello! Tell us who you are and what’s your backstory.

‍I was born and raised in Prague, Czech Republic, during the 1980s. From the moment I received my first Sinclair ZX Spectrum+ computer as a child (and subsequently a 486SX!), I found my passion for programming. So, choosing to study computer science was a straightforward decision for me. Initially, I obtained an MSc in software engineering from Charles University in Prague, followed by a PhD in artificial intelligence from Trinity College Dublin.

Throughout my studies, I felt I was being drawn to entrepreneurship. In 2009, I co-founded a startup named VirtualRig™ Studio, which developed a motion blur tool for automotive photography. Seeing that you can develop software, and people all around the world would be willing to pay to get get copies of it was truly magical! A bit later, I co-founded a consulting firm with friends from university, including Jakub Balada, who would later become my co-founder at Apify. During a client project, I developed the initial version of the software that would evolve into Apify. Today, thousands of customers worldwide use our software to get more value from the web.

‍Can you give us your 1-3 sentence elevator pitch?

‍Apify is a full-stack web scraping and browser automation for developers who want to extract data from the web or automate mundane tasks on the web. We run an app store with more than a thousand ready-made tools called Actors to extract data from e-commerce sites, social media, search engines, online maps, or pretty much any other website. These Actors cover use cases such as competitive intelligence, marketing analytics, data for AI, lead generation, and compliance. We also provide open-source tools, cloud infrastructure, and proxies for developing custom scrapers, and enable the developers to build and publish their own Actors and make a passive income from them.

‍What was the moment or situation that sparked the idea for your business?

‍Around 2014, a customer asked us to set up a system to extract large amounts of data from a variety of websites. We tested many existing web scraping solutions, but none of them worked well on all those sites. The “point and click” tools struggled on more complex websites, and programmatic crawlers were too low-level and required too much setup. We thought: why can’t we have a generic tool that would reliably crawl any web pages like a normal web browser, and then let us provide just the site-specific data extraction code as front-end JavaScript code - the most popular programming language for web development? With such a tool, setting up many scrapers for various sites would be quick and simple. And since there was no such tool, we built it using a then-revolutionary headless web browser called PhantomJS. It turned out people liked it and wanted to apply it to their projects.

‍How did you test and refine your initial product idea, and were there any significant pivots or changes in direction based on initial feedback or market response?

‍At first, our solution was a simple command-line tool. It worked well, but you still had to set up the computing infrastructure yourself - running/scheduling the crawlers, integrating proxies, storage of results, etc. To make the solution really easy to use, we knew we needed to turn it into a cloud service that provided all these features out of the box. In 2015, we applied to the Y Combinator Fellowship with our project and were lucky enough to be one of the 30 selected startups from about 6,000 applications. So my co-founder and I moved to a small house in Mountain View where we worked day and night on building an online service for two months. Eventually, we launched it publicly as “Apifier” in October 2015. We’ve been iterating and improving the product ever since based on feedback from our customers.

‍What specific strategies or decisions significantly contributed to the growth and scaling of your business?

‍In the early days, we followed the Y Combinator philosophy of building startups. We spent our time only working on the product, talking to customers, eating, sleeping, exercising, and doing nothing else. We measured our progress week by week. We tried to build something that a few people really love, rather than something lots of people think is mediocre. It worked for us, and we got some initial traction.

Ever since the early days, our strongest customer acquisition has been organic search, and so we’ve put a lot of effort into nurturing this channel. We’ve done that by writing content, having a forum, and also launching a library of ready-made solutions, where each solution is a landing page for a specific use case.

Another impactful decision was to build something open source to pay back and also attract the developer community. For example, we built Crawlee, which with 12k stars on GitHub is now the most popular web crawling library for JavaScript.

‍Can you share some major challenges and how you tackled them?

‍One Y Combinator partner once told us that “startups are a shitshow” and that nothing works well until it does. And he was spot on! Especially in the early days, startups face major challenges practically every day, and it doesn’t get much better even as they scale 🙂.

For example, one of our major challenges early on was that we lacked focus. One part of the company was building a product for developers, and the second half was selling custom solutions to non-technical businesses. These two audiences are very different, and by trying to appeal to both, you serve neither of them well. When things were growing, we ignored this problem - until 2022 when our growth stalled. We became unprofitable, and we had to make some tough choices, including reducing expenses and laying off part of the team. It’s well-known that startups need to be laser-focused, but we ignored it, so the market had to teach us a lesson. After that, we made it clear we only build for developers, and cut everything else. It was this decision that helped us get back on track.

‍How did you really get to know your customers and market?

‍The best way to know your market and customers is to be one of them. We’re building a product that we use ourselves every day, and hence we have a good understanding of the problems. And of course, we talk to users and customers non-stop, keep an eye on our competitors, and engage with our community on GitHub or Discord to understand what’s going on.

‍What's the story behind your brand and marketing approach?

‍The Apify brand is built around empowering developers with the tools to unlock the web's full potential. Our marketing reflects this through a focus on simplicity, helpfulness, and community support. We combine educational content, community engagement, and transparent communication to convey the value of our platform to an audience who aren't usually fooled by or enamored with typical marketing.

‍How did you attract and secure your first customers?

‍We attracted our first customers through a public launch on Hacker News and Product Hunt, and word of mouth. Eventually, organic search became our main acquisition channel, and we invested a lot of effort in SEO, content marketing, link building, etc.

‍What's been your approach to product development?

‍Continuous feedback loops with users have been central to our product development. The teams give a lot of weight to user suggestions, bug reports, and feature requests, integrating them into the development roadmap to make sure the platform evolves in alignment with customer needs.

‍How have you navigated the financial aspects of your business?

We only raised $0.5M in a seed round in 2016, and then effectively bootstrapped the business over the years to more than $8M ARR now. And when you bootstrap, you know very well the value of each dollar, because you had to earn it from customers before. So we needed to learn how to “run a tight ship” and be very cautious of our expenses. Thanks to running the business this way, the cooldown of the VC market in 2023 had no impact on us, unlike many other startups that heavily depend on venture funding to operate. We recently closed a funding round of about $3M. We’ll be using the new funds for marketing, expanding our developer community, and hiring more people for our engineering, product, and data teams.

‍What future do you envision for your company?

‍Our short-term goal for Apify is to become the best and best-known web scraping developer platform, which supports most programming languages, scraping libraries, and integrations while being easy to use. The long-term vision is to become the world's largest platform and marketplace for web automation software - the most effortless way for developers to ship and make money on their software and the easiest way for companies to get the job done.

‍Is your team growing? Tell us about the roles you’re looking to fill.

‍We're growing rapidly and looking for talented people to join our team, not only in Engineering but also in Growth, Marketing, Data, and Product. You can check our brand-new Careers page.

‍Where can curious minds find more information about your business?

‍🌐 Visit the Apify website to learn more about what we do
👥 Join the Apify community on Discord to get support from fellow developers
🕸 Check out Crawlee to learn how to build reliable crawlers fast
🤓 Read the Apify blog for product updates and tips from the world of web scraping
📹 Watch our YouTube channel for web scraping tutorials

‍Do you have any reflections or insights you’d like to share with our community?

‍Reflecting on Apify's journey, the key takeaway for aspiring entrepreneurs is to keep going. Build a product that solves a genuine problem, engage with your users, be receptive to feedback, and then, most importantly, stick and keep going. Building a startup is not a sprint, but a long series of marathons, which can easily take 10 years to complete.


Visual Storytelling!

Apify Office - guided tour with our CEO Jan Curn