Evernote: 'The longer you use it, the more likely you are
Source: Stephen Shankland
PARIS--Most people who try Evernote quickly lose interest in the cloud-connected note-taking service.
But Chief Executive Phil Libin isn't worried, because in the long run, they come back--and start paying. He showed statistics today at the LeWeb conference here to prove the point.
In the first month after signup, about 45 percent of people are return users. That drops down by half to 22 percent by 17 months. But then it picks up, and by 42 months, it's back up to 43 percent.
And as they stick around, they eventually start paying for the premium version of the service.
"In the first month of using Evernote, only a half of one percent pay us. It goes up every month after that," Libin said. "The longer you use it, the more likely you are to pay."
His graph showed premium users rising steadily to 11 percent over 33 months of use, then it surges to 26 percent by 42 months of use.
"There's a buildup of long-term value," Libin said. "If you never ask people to pay, but give them time to fall in love, they want to pay."
The number of users is growing, too. In the last year, Evernote's user base grew from 5 million to 20 million now. Of them, 750,000 are paying customers. Libin wouldn't disclose revenue, but at $45 per year for the service, that would mean something in the neighborhood of $33.8 million annually right now.
The company is cutting deals to increase its user base by getting its app installed on phones. It's got one partnership with Japanese wireless operator NTT, and today it announced another with France Telecom's Orange.
The company itself is growing, too, aided now by a new $50 million investment from Sequioa Capital.
"We got the company to profitability about six months ago," then raised the new funding, Libin said. "We're back in the red so we can hire so fast. We can go back into profitability in a couple months."
The company is expanding its scope, too. Earlier this year it acquired Skitch, which lets people annotate images. And this week, it's announced two new smartphone apps, Food and Hello.
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