Mar 26, 2021 · 30m · we-live-to-build
Microsoft Launched a Free App That Competes With Ours
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of We Live to Build, host Sean Weisbrot interviews Chit Chatter CEO Hilton Gisenau about the realities of building B2B SaaS applications for the Microsoft Teams marketplace. Gisenau outlines the complete developer journey, from overcoming app store review bureaucracy and enterprise procurement hurdles to managing platform risk when Microsoft launches competing native tools.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Sean holds 21.3% of the talking time here. How this is scored →
Sean as informed peer 3.5 Guest teaching 4.8 Guest disagreement 0.9 Sean pushing back 0.9
speaking balance: gold is Sean, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 21:20 Hilton reframes review timelines against Sean's patent comparison
Hilton mildly pushes back against Sean's hyperbolic comparison of Microsoft's review process to years-long patent office delays, insisting review turnaround spans days or weeks rather than years.
Hardest push from Sean ▶ 20:53 Sean challenges Microsoft's bureaucratic validation workflowSean refuses to accept the multi-stage review process as standard software operations, explicitly likening Microsoft's validation hurdles to the inefficient USPTO patent bureaucracy.
Biggest teaching moment ▶ 12:05 Hilton educates on the hidden costs of Teams zero-cut platformHilton explains the nuanced trade-offs of Microsoft taking 0% fees compared to Apple's 30%, showing how the absence of native billing creates friction and customer confusion.
Sean holds their own ▶ 27:55 Sean contextualizes platform risk using Apple and Amazon precedentsSean demonstrates sharp industry expertise by synthesizing Microsoft's app duplication tactics with well-documented predatory platform behavior by Apple and Amazon.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Sean as informed peer | Guest teaching | Guest disagreement | Sean pushing back | Why |
|---|---|---|---|---|---|---|
| Hilton Gisenau's Background in the Microsoft Ecosystem | 2 | 3 | 0 | 0 | Sean opens the conversation with standard scene-setting and asks Hilton to outline his background. Hilton details his twenty-plus years in the Microsoft enterprise ecosystem spanning SharePoint to modern Teams collaboration tools. | |
| Pivoting from Bespoke Consulting to SaaS App Development | 3 | 5 | 1 | 1 | Sean probes into the real adoption and conversion metrics of the Teams marketplace. Hilton explains the stark psychological and bureaucratic differences between B2C app stores and enterprise B2B purchasing workflows. | |
| SaaS Pricing Complexities, Tiers, and Monetization Models | 6 | 2 | 0 | 1 | Sean demonstrates domain knowledge by detailing specific SaaS pricing headaches across Jira, GitLab, and Bitbucket tiering. Hilton agrees and notes that SaaS pricing is both an economic and marketing challenge for product builders. | |
| Advantages, Drawbacks, and Developer Realities on Teams | 2 | 6 | 1 | 1 | Hilton outlines the advantages of Microsoft's zero-percent fee model alongside its major drawbacks, such as lack of native billing infrastructure and end-user confusion over paid third-party add-ons. | |
| Overcoming Review Bureaucracy and Technical Hurdles | 5 | 6 | 1 | 2 | Hilton walks through the rigorous Microsoft Partner Center submission and review process. Sean draws a critical parallel to the tedious bureaucracy of the patent application process. | |
| Enterprise Security, Governance, and SOC 2 Compliance | 2 | 6 | 2 | 1 | Hilton gently counters Sean's suggestion that reviews take years, noting that enterprise compliance hurdles like SOC 2 audits pose far greater friction than Microsoft store validation. | |
| Minimum Viable Products, Sideloading, and Store Validation | 2 | 6 | 1 | 0 | Sean asks for alternative go-to-market strategies. Hilton shares a story of an app rejected for lack of perceived business value, advising founders to test validation through fake doors and developer sideloading. | |
| Platform Risk, Microsoft Competition, and Building Moats | 6 | 4 | 1 | 1 | Hilton explains the platform risk of Microsoft releasing competing native features. Sean demonstrates strategic insight by comparing this to Apple and Amazon commoditizing top third-party products, prompting Hilton to emphasize building strong proprietary moats. |
Statements from this episode (16)
Gisenau: ChitChattr Saw Strong Teams App Installs but Lower-Than-Expected Conversions
“We've certainly had a lot of interest, a lot of installations, pretty good uptake from that perspective, lower conversions, I think, than we expected.”
Gisenau: Users Refuse to Pay Out-of-Pocket for B2B Workplace Apps
“In the B to B marketplace, business to business store marketplace, the dynamics are surprisingly different. You know, there might be an app that I kind of like, On, on, let's say the, you know, my fruity device and I'm happy to pay the 10 dollars a month for i…”
Weisbrot: GitLab Lacks Project Management Functionality Compared to Jira
“I've been working towards moving my team from GitLab to Jira because of the project management functionality that GitLab lacks”
Gisenau: Microsoft Teams takes zero cut of app revenue
“On the Microsoft side, there's no charging model. There's no fee model at all. On the one hand, that's kind of a little bit of a negative. There's no charging model built in, so there's no model natively in the platform to charge customers. The positive of tha…”
Gisenau: Teams users mistakenly expect marketplace apps to be free
“One of the things we've found, for example, is that users are quite surprised that there's a pricing involved for the purchase of our apps. We've had a number of customers or a number of feedback items, shall we say, from users who've been quite surprised that…”
Gisenau: ChitChattr faced Teams rejections from conflicting internal Microsoft requirements
“We had, for example, portions of our app get rejected because of requirements that were coming through from the main team's engineering team to the store validation team that would like literally just in conflict with one another.”
Gisenau: Building a Teams bot requires mastering 7-8 separate technologies
“One of those, for instance, is building a bot. You might want to put a bot into the store and there are probably seven or eight separate technologies you kind of need to get yourself or your team skilled up on in order to build a, you know, natural language, u…”
Gisenau: Microsoft Partner Center lacks usability and consistency compared to customer software
“The software that Microsoft has that are facing partners as opposed to facing customers is, is, you know, not, not necessarily the same level of usability or consistency or bug freeness or anything like that. So the partner center itself is, is a bit of a chal…”
Gisenau: ChitChattr cut Teams app verification from one month to two days
“To give you an idea of that, our first app was probably about a month or so of verification backwards and forwards. The last app was on the order of like two days. I think there were two minor things they came back with. We fixed them and resubmitted and we we…”
Gisenau: Microsoft Teams review team responsiveness slowed significantly as store hit 800+ apps
“When there are 800 and something apps, each of those potentially submitting new versions, and obviously a ton of other apps going through as well. So they've slowed down quite a bit in terms of the responsiveness, shall we say.”
Gisenau: Enterprise SOC 2 compliance is much worse than Teams store review
“You can imagine something like SOC two compliance is a difficult and onerous process that you might need to go through if that's the audience that you're targeting with your store app. Much worse than the team store, I guess is what I'm saying.”
Gisenau: Microsoft rejected a functional Teams app for lacking business value
“We've got a few apps that we've built. One of them never made it to the actual store itself. We went through the entire process, the verifications, there were a few bugs that were raised. We addressed all of those things, et cetera. And at the end of it, Micro…”
Gisenau: App store verification requirements conflict with rapid MVP testing
“If you're trying to test the validity of product, which is worth doing anyway, the equivalent concept of an MVP, understand that the store process is going to put requirements on you that don't necessarily make sense in terms of trying to get something to mark…”
Gisenau: Sideloading apps with beta customers is best for Teams MVPs
“That's probably the best bet is to try and work with customers, your potential customers, your potential beta customers, things like that, and look at the side loading option as the best.”
Gisenau: Microsoft launched a free app competing with ChitChattr
“We had an incident about a week ago or so where Microsoft have launched a free app, a portion of which competes with an element of our application.”
Gisenau: Platform apps require complex IP moats to survive platform competition
“I think what one needs to do is in considering whether the product makes sense is not just whether it's a, you know, fulfills a business need, but whether it's the kind of product that you can build significant IP into to make sure that your moat's big enough.…”