The Story of Loom

The Accidental Pivot That Created Loom

Back in 2016, The trio of Joe Thomas, Vinay Hiremath, and Shahed Khan launched OpenTest, a user-testing platform that allowed companies to gather customer feedback through videos.

There was just one problem—no one cared about user testing.

Instead, they saw that people were attracted to the quick and easy screen recording feature that OpenTest had built in. Instead of pushing their original product, the trio decided to pivot to what customers wanted. In 2017 they decided to:

• Scrap OpenTest entirely

• Rebrand to Loom

• Build a refined product focusing on frictionless screen recording

🔑 Key Takeaway: Listen to your users. Figure out what customers want early on and pivot, creating a product that molds around that.

The Growth Strategy Behind Loom

Many startups focus on paid ads to fuel growth. Loom on the other hand instead focused on:

• Seamless UX - Loom made it very simple and easy for someone to record and share without needing to download. It was as simple as clicking record and sharing the link after.

• Freemium Model - Rather than charging upfront, Loom enabled users to record and share for free, with premium features available for a fee. This facilitated seamless adoption. 

• Viral Collaboration - The biggest reason for growth for Loom was making every user a promoter. When people shared their Loom videos, new users were exposed to the product without Loom having to spend any money.

These three key strategies fueled Loom’s growth without the need for expensive ad spend.

🔑 Key Takeaway: Focus on product-led growth. Deliver quick, easy value, and make every user a promoter.

How Loom Makes Millions

Loom’s business model wasn’t to just attract users—it was about monetizing at the right moment.

These are the three main strategies that made Loom millions:

• Freemium Model - Going back to the freemium model, users were able to get access to core features for free but, premium features like (longer recordings, team collaboration, etc.) were paywalled.

• Value Before Monetization - Loom focused on providing instant value for the user rather than charging upfront. Free users got hooked and would be more likely to pay for premium features later on.

• Enterprise Adoption - As more teams integrated Loom into their daily workflows, the company introduced enterprise plans for businesses.

By the time users considered upgrading, Loom had already become an essential part of their workflow—making the decision to pay an easy one.

🔑 Key Takeaway: A freemium model isn’t just about offering free features. It’s about creating demand for premium features by making users dependent on the product first.

🔑 Key Takeaways For Founders

• Pivot your product based on user demand: Loom wasn’t a screen-recording tool at first. It became that because that’s what people wanted.

• Virality does not need expensive paid ads: Loom didn’t rely on paid ads. It relied on each user becoming a promoter. Create a product that promotes itself.

• The freemium model isn’t a giveaway—it’s a strategy: Give users just enough value for free to get them hooked. Then make them want paid features.