HiOperator (YC S16) Provides Customer Support as a Service

While the business development team there (along with their head of training, Mary Waltuch) are largely responsible for the constant failure of that company, I think that SPRT's experiences proves unequivocally that this business model does not work at any reasonable scale.

Your clients are strongly incentivized to demand your service at a significantly lower rate come contract renewal regardless of what your cost to deliver is. Your competitors, like Support.com and Sutherland, among others, will happily underbid you. Aggressively. While I worked there, I had my salary and benefits _cut_ at least once a year.

You'll cut costs by moving some operations to places like the Philippines while not learning the lessons of others who have done the same. One bad monsoon season and none of your workforce will show up for weeks/months. Support.com learned this one the hard way, despite my warnings.

Maybe you'll show some backbone in negotiations, not bend over and take shitty contract terms from "huge brands" like our bizdev did at SPRT. This is more critical to your success than you can imagine. We sure did love hiring bizdev people whose experience was at failed companies (RadioShack, Circuit City and a bunch of people from Intuit who got sacked).

Best of luck to you. I really hope that you succeed...there isn't really good service from anyone in this market segment right now; the training is poor and it's a race to the bottom on price. Consumers need this to be good. Don't f' it up.

A few quick thoughts though. We are committed to keeping support local - in this case in the US. We’re not trying to be the lowest cost option, nor are we trying to handle the long tail of customer support. We focus on 80/20. And there is plenty of 80 to be had, even at scale.

There are a few specifics to how we’re organized and how we incentivize our agents that we’re seeing help align incentives a bit better.

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  From the website:
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  $999/month 
  Starting at $3.50+/case for most everything

  Starting at $1.25/minute for a voice operator

  8 hours of coverage, 5 days a week

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Suddenly I'm at $6,399 MINIMUM.

Nice try I guess.

Now might be a good time to clarify our pricing a bit and state that our pricing is not a one size fits all model. We analyze our clients ticket and call histories and find a price that works for both.

The $999 is a minimum spend and from that we deduct cases and voice minutes. The minimum covers training and overhead to ensure we're not losing money for clients that are too small. We've also found that, in our experience, companies who tend to spend less than $999/month are sometimes still at the point where their support tickets are full of a lot of edge cases and are best handled in-house.

We're aimed at small and medium companies, not individuals running small projects (yet). Someday in the future hopefully, but we're not there yet.

As a related tangent, one thing we do for a few companies is essentially serve as air traffic control. Even if we can't solve all of the issues and some issues need escalation, we help make sure that it's only one hop away from the right group.