EP 39 - sailroad - V1

The First Big Usage Spike SPEAKER_01 0:00 The moment we found True Product Market Fit, there were four of us up until then, we hadn't had much usage, no usage in the product at all. And we onboarded a new customer. So we had left work at whatever time in Ireland. Uh the company was based in America. And we came in to work the next day and we checked the post hog metrics and we were running around the room celebrating. When you see the graph flat for so long and then a massive spike where we had thousands of simulations, as we call them, and then hundreds of users in the platform. I remember my co-founder and CTO Patrick being very emotional, tears in his eyes, that all the work he put in and that someone was eventually using something that he had built. Like how we actually scale to our first million dollars AROR came from cold outbound. So we were sending like 500,000 emails. We got 5,000 replies and 250 meetings booked, and then like a 20% conversion of those meetings booked, which was 40 customers and an ACV of 25k to get to million dollars AROR. Pablo Srugo 0:56 You raised a $25 million Series A last month. How many people were you when you raised that? SPEAKER_01 1:01 12. Honestly, I was lucky and fortunate that we got a term sheet within six days for that first week. Process was actually quite quick. Had the calendar completely stacked. Like I'm a big believer in like you're either fundraising or not fundraising. There's a lot of like, oh, I'm doing these coffee chats, and like hopefully we'll get preempted from this coffee chat and all these. It's like you're fundraising, you're fundraising. So calendar was probably blocked with like you know 12 meetings a day. That's product market fit. Product market fit. Product market fit. Pablo Srugo 1:28 I called it the product market fit question. Product market fit. Product market fit. Product market fit. Product market fit. I mean, the name of the show is product market fit. Do you think the product market fit show has product market fit? Because if you do, then there's something you just have to do. You have to take up your phone. You have to leave the show five stars. It lets us reach more founders and it lets us get better guests. Thank you. What SolidRoad Builds And Why Pablo Srugo 1:51 Mark, welcome to the show, man. Thank you very much for having me. Let's start with the thing that really matters. Let's start with product market fit and then we'll work our way backwards from there. Tell us for you, like when was the moment when you felt like you'd found true product market fit and why? SPEAKER_01 2:06 Yeah, I think the moment we found true product market fit, there were four of us. So it was myself, my co-founder, and the two kind of early employees. We were in our very small annex of a building office in Dublin and Ireland. Up until then, we hadn't had much usage, no usage in the product at all. And we onboarded a new customer called Partner Hero, their kind of BPO outsource call center. We have a lot of conversation volume. They were using it in their Partner Hero Academy for onboarding uh new agents into the business. So we had left work at whatever time in Ireland, uh, the company was based in America, and we came in to work the next day and we checked the post hog metrics and the usage metrics in the tool. And we were running around the room celebrating because it was uh it was definitely a pinch me moment where when you see the graph flat for so long and then a massive spike, where we had kind of thousands of simulations, as we call them, uh used overnight and hundreds of users in the platform, lots of errors and the tool breaking, but they still kind of push through and used us. And yeah, I remember my co-founder and CTO, Patrick, being very emotional, tears in his eyes, uh all the work he put in and that someone was eventually using something that he had built. Pablo Srugo 3:19 Well, that's the moment when, you know, the thing that you've thought about and you thought people get value a certain way, and then you see people actually, like in reality, get that value. It can be transformative, like a very zero-to-one event. Maybe tell us a bit more now that we understand that moment, what it is that your company does and what your company did for that customer. SPEAKER_01 3:35 So Solid Road is an AI-first training and quality assurance platform for enterprise CX teams, customer experience teams. There's two components to the product. We have a conversation simulator, which allows agents to practice realistic conversations in a risk-free environment and get coaching and feedback. So that's across all modalities: live chat, email, video call, et cetera. And then we have our production environment where we give coaching and feedback on live interactions. So we connect to your help desk softwares like Intercom, ZenDesk, Salesforce, Service Cloud. And then we close the feedback loop. So we will find issues in production and then automatically create these trainings. To close those skill gaps, um, we also score your human agents and your AI agents so you can benchmark them against each other. So if you're using a Sierra or a Decagon or a Fin, we can see where you should actually deploy your conversation volume. The easy analogy I always give is when you bring a call center and you hear this call is being recorded for training and quality purposes. Historically, that was very laborious. It would be uh human auditing transcripts with a rubric, uh, only getting to 1% of that conversation volume, and then doing follow-up classroom-based learning. We've built AI agents that completely automate that process. So 100% coverage of all your conversations, so you have full visibility. And then as I mentioned, closing that improvement loop for your human and AI agents. Pablo Srugo 4:56 And this customer that you were just talking about, when was that deployment? SPEAKER_01 5:00 That would have been early 2024. So I think it was about March 2024. Pablo Srugo 5:04 So that's like two years ago. What part of the product were they most using back then? SPEAKER_01 5:08 That was just the simulation tool for um, so actually practicing conversations like AI role play for customer support. And they were using it in interview loops for new hires, and then they were using it for onboarding. And that was really the kind of the pinch me moment that it was being used so heavily during this partner hero academy, which was for uh just new hires. So to reduce that ramp time, time to proficiency or time to competency as it's often used in the contact center world. They were ramping agents like in 50% of the time and using half the people. And we were like, okay, this is super valuable. Pablo Srugo 5:41 And you mentioned that before, I mean, you started what a year before that, like 2023? SPEAKER_01 5:45 Yeah, incorporated the company. I think it was January 2023. Pablo Srugo 5:48 So it'd been like a year or so. And you mentioned before that it was flat. Was it just that you were building, or did you change something to have that click, you know, product market fit moment? SPEAKER_01 5:58 For a big portion of that, it was building. So it was my co-founder Patrick building the tool. And this was like very early, like GPT 3.5, first version of Chat GPT, building our own The Pivot That Unlocked Demand SPEAKER_01 6:10 like speech to text uh before we could use tools like Vappi and 11 Labs, even when we were very early to even using 11 labs. So a lot of this stuff was like uh yeah, it wasn't fit for purpose. Like uh we have some funny examples of people on pilots like screaming at the recording because the AI kept interrupting them, so lots of swear words in there. Uh so we have them uh in the the archives to look back on. But it really just the product really wasn't there yet. So that was probably the first six or nine months, and then we went after the sales vertical because my background was sales. I was an early sales hire at Intercom, and we applied the tool for like AI role play for sales, got some early customers there, then ended up actually firing those customers because what we found was even in the customers we did close, they were like startups that really didn't have the problem. And then when we went more up market to larger companies, it was actually the support org that was using it more than the sales org, our background being X Intercom. And that's where I met my co-founder Patrick, kind of had domain expertise in customer support and CX, kind of ran hard and fast there, half of that partner here on the moment. Pablo Srugo 7:11 That was the big change, like going from a sales role-playing, which there's been companies that had, you know, hyperbound or whatever that have like traction there, but you moved from sales role-playing to customer success role-playing, and that's where you saw things really hit off. SPEAKER_01 7:22 Yeah, exactly. Pablo Srugo 7:23 So let's go through. I mean, you just went through the story, but you kind of gave us the two-minute version. Now, now that we understand kind of like where things started to work, let's kind of work backwards. You started, as you said, 2023. Give give me a little bit of of Founder Origin And Early Experiments Pablo Srugo 7:35 your background before that and kind of just the genesis origin story. Like, why did you start this company in the first place? SPEAKER_01 7:43 Yeah, I suppose like a bit of background on myself. Like, I would have met my co-founder actually first in university. We both studied in in Trinity College in Dublin. I studied business and economics, he studied uh computer science. We were both part of the Trinity Entrepreneurship Society, as it was called. So we would kind of tinker on ideas together in university. Both happened to start our careers at Intercom at the same time. So that's when I would have got to know him a good bit better. Uh he started as a product engineer and I was a kind of BDOR, kind of entry-level sales position. Interesting, Patrick was working on like the sales use case team at Intercom. Uh, that was when the Intercom was building everything from marketing, sales, and support, uh, not just customer support. Uh so he would like build things and I'd be his guinea pig where I'd test new features and stuff like that before kind of getting them added to the roadmap. This was when, by the way. What year are we talking about? 2017. Yeah. So both kind of worked there for a couple of years. He then had his own start, his first startup, which was a YC company in summer 2019. And I had my first business, which was uh a company called Grad Guide, which I took full-time and raised two million against that business. And that was a kind of graduate recruitment platform where we would connect students and grads with a mentor a few years ahead of them on the career ladder to help them find their first role. So it was more like of a mentorship platform, particularly focused on sales support roles and to help people land those kind of entry-level jobs. After that, then like I sold that business in late 2022 and Patrick left his YC company. We'd always stayed in touch, and like one thing we like I realized that I didn't have a technical co-founder, he didn't have like a sales co-founder, someone to focus on distribution. So we always wanted to work together. So to be perfectly honest, the origin story, we have a memo about this that I can share called Mark and Patrick Inc., but it was really like Mark and Patrick wanted to work together and build a business. And then the ideation kind of came after. Pablo Srugo 9:31 So but it was the perfect time. I mean, late 2022 is probably like out of all the times where you could just be like, me and you are gonna do something, we don't know what, that's like the best time for that to happen. SPEAKER_01 9:40 Yeah, it was funny. Like I sold the business in November 22 when like ChatGPT just launched, and I had to do like a month handover basically to the new owners, and we were kind of just like working out of uh a working space in Dublin. We got free access to it, a place called Dog Patch Labs. Um, they gave us a free desk, and we were just like tinkering on ideas, taking long walks around Dublin in the cold winter, and eventually then kind of landed on the first version of Solid Road and took it full-time in January 23, like I said. Pablo Srugo 10:10 What was the first idea of what you decided you wanted to build together? SPEAKER_01 10:13 There was lots of them. Uh, I think the first one was kind of like uh going to be a gong competitor, like yeah, meeting bot, but yeah, there are so many of those quite a commoditized software. So we built the first version of that, and then we send the transcript to ChatGPT and it would summarize the call. And even back then it was hilarious that like people were amazed by this because this is before the lights of Gone course AI had even implemented any AI into their product. And so people were like, oh, this is amazing that like I can get a summarized version of my my sales call. And we built that on top of I remember it was another kind of YC company that was kind of the first version, and then that brought us into the kind of role play training when the kind of speech of text of scope got slightly better. Pablo Srugo 10:52 It's funny, the the you know, the thing you're mentioning about sending it to Chat GPT and that kind of being like V1 of some product, that's why GPT rappers got such a bad name because that was the original GPT rapper. You just do something like incredibly simple, you know, take it to Chat GPT, bring it back, and like this is a product. And then obviously a lot of those got killed by either an incumbent, like a gong or Chat GPT. And then the thing became oh, you don't want to be a rapper. And still people are saying, like, you don't want to, and the reality is if you think about every vertical AI app for the most part, like they are rappers, they are they are rappers, they're just really good and they embed the workflow and all this stuff. But it's funny to have that in your origin story just because the time aligns so well. SPEAKER_01 11:32 Yeah, we knew like early on when we started using ChatGP for the first time, we're like, this is gonna be massive, like there's gonna be so many opportunities on the application layer. So yeah, just kind of started from there. But it was funny, like if you can remember, January 2023 was a terrible time to raise money. So like we were like, oh, Mark and Patrick, both second-time founders, like somewhat successful. Like, this will this will be easy enough. Pablo Srugo 11:54 Let's go raise some venture money. And uh it should have been the best time to raise money, but yeah, we had the macro winter of 22 and the AI stuff was just kind of starting off. SPEAKER_01 12:03 Yeah, so yeah, didn't have success there. So we were fortunate that we got like we shook the bucket and got some like Irish angels who invested enough to like pay ourselves a bit of a salary that I could cover my mortgage and go full time at the business. So even like we have like a rejection wall of all the VC rejections we have in our office in San Francisco now, and like a quote that says, uh, chips on shoulders puts chips in pockets. But yeah, it's been a motivation for us because uh although yeah, we since raised venture rents and got through Y Combinator, the start was uh a bit tougher to get off the ground. Pablo Srugo 12:34 Oh, yeah, you've raised what, over $30 million so far? SPEAKER_01 12:37 Yeah. Pablo Srugo 12:37 So things have changed. Tell me how you get from what you were first doing, which is kind of this gong-like, you know, AI version of Gong, let's say, to the first version of a product, which sounded like it was the hyperbound, right? The AI role-playing. Was hyperbound around? Was it like a fast follow, or was it just like you were coming up at the same time or different Why San Francisco Changed The Path Pablo Srugo 12:54 times? SPEAKER_01 12:54 To be honest, I think we might have been actually before hyperbound because then we saw the hype when they um they went somewhat viral on LinkedIn and we're like, we were doing this. Yeah, we were doing this. I think I think honestly, was it was a really good moment for us though, because I realized that we had to move our lives to San Francisco to build a very big business. And you could see like my background now, I've got Coitero in the background, but that really became a forcing function. So we started with the gong competitor, as we said, that was getting commoditized. We knew that they would just bring these AI features on. But then when we had conversations, because if you look at startups, obviously they're connected graphs, so like looking backwards, it all makes sense at the time, maybe not. But then it was like we really um we built like these kind of coaching and feedback from the the recorded calls, and people were like, I really value this like coaching and feedback. That's actually very interesting. Like the scorecards and gong are really crap, and I have no way to actually improve. So then we built the roleplay tool and we had the coaching and feedback and people like, oh, this is really strong. But the sales leaders or startup sales in particular didn't really care as much, went into support. That's what we knew better. We'd like scaled support orgs using it. Again, really like the coaching feedback enough to say, like, like, if I actually was to say one thing, like the flywheel we built from the get-go was this the scoring, the scorecard and the scoring system, the the evaluations that we built. Because then it was like, Oh, I love this for training, but I'd love this in our production environment as well, because QA is still super manual right now, and we don't have visibility into our conversations. So we use the same scoring system basically, somewhat evolved all the way throughout. And like to answer your question about the hypermem piece, we had as I Patrick had built all this stuff himself. He wasn't using the likes of Vappi, for example, to build the role play tool. We went out to San Francisco. There's actually like an interesting tweet, I can try to surface it, but of me demoing solid road to people that like this YC event because Patrick had done YC before. They're like, oh my god, that's so cool. Super early days, really long latency, etc. And then we came back a few weeks and then like hybrid band launches and they'd built on top of Daily Co. and Vappi and all these tools that we didn't even know existed when we were out in San Francisco a few weeks before, or maybe they weren't even around yet. Because I think we were quite early customer into Vapi in the end. We were like, okay, well, that's so much better than what we built. We need to move on to these third-party softwares. But then also, like everything's happened in San Francisco. Like, that could have been us having this viral moment had we been in San Francisco, but we're in Dublin in the middle of nowhere, where so that really became like, okay, we need to get over San Francisco. So, like, we would even with very little money be like doing these like low budget trips to SF. Patrick moved over to San Francisco by like first because like all the kind of tech stuff, the labs being there, etc., moved over on like I don't know how he survived. Now living here for six months. I don't know how he survived on like the salary he was uh it's expensive, man. Oh like on an like a low Irish salary in San Francisco. So I'll be forever indebted and grateful for him for the months that he put in there. So he would have moved over September 2024, and then we got accepted into YC in November 24, and then did the YC winter 25. So January. There was four of us. We all moved over then. Pablo Srugo 15:49 Two more guys joined. So this is I think this is a really interesting thread to pull on a little bit. Obviously, you're you came from like a secondary city and you go to Bay Area where like, you know, almost all this stuff is happening. That story about Vapi specifically in Jordan was was on the show. So I know kind of how that happened, and you know, it but it's very interesting how you know finding out about something a couple weeks before can have such a big impact. But you have the before and after. Like you weren't there, you were building, doing stuff, and now you are there. Maybe speak a little bit, you know. Imagine you're a founder, if you're talking to you're talking to yourself, you know, before you move, you're talking to a founder who's like thinking, should I, shouldn't I? How important is it now that you've done it, right? How much benefit did you really get from it? SPEAKER_01 16:26 Yeah, I I could not be a bigger advocate for San Francisco. And I think it's really down to the surface area for luck, like just being here, being in the room with people, like how connected the ecosystem is over here. It's like it's all very serendipitous. So, like that example like I gave already about kind of giving the demo, but there's so many other examples being over here of like meeting our Series A investor while we're doing YC at like an Irish meetup event in San Francisco. It's is really hard to like quantify, but it's I how I'd say it is like it increases your surface area for look. And I always think back when we graduated from Y Combinator on the last day, they just put up like all the data behind like companies who stay in SF and companies that leave SF, even if you go to New York, like it just like the chances of success are just so much higher if you stay here in person in SF. And yeah, startups are really fucking hard. So like being able to like increase the surface area of your luck and increase the chances of success when you're trying to build a multi-billion dollar business. Like we always talk about like even why we pick this office because we want to build Salesforce terror that usurps solid uh solid road terror that usurps Salesforce terror in the skyline and SF. So you will also think bigger by being out here. Like there's a bit of Catholic guilt working, living in Ireland where it's like, oh, tall poppy syndrome kicks in, but you come over here, and like everyone's like, oh yeah, like I'm a billion-dollar business, like okay, what revenue dude? Zero. We're only starting, we're we're building a billion-dollar business, like great. Pablo Srugo 17:55 A lot less skeptics. Yeah, 100%. Let's go a little deeper on the moment where you switch from sales role-playing to customer success role-playing. Tell me more about how that came about. It happened for you in the way that it happened for you. But I mean, the idea that you have a product kind of works, like could work, maybe, and then somehow you see just enough things that you put it somewhere else and it really explodes. Like that's common, right? So I'm curious how it really happened for you. SPEAKER_01 18:18 As I mentioned, kind of the kind of earlier customers gave us the reassurance that like this is the right ICP to go after. We really then narrowed in on that. So went after like heads of customer support, VP of operations rather than targeting. Pablo Srugo 18:31 But did you sell sales and they just pulled you to customer success, or did you just like luck into or just start trying customer success just because like how do you even how do you even make that transition? How does that start? SPEAKER_01 18:42 Yeah, it was kind of looked in through that like contact center that we initially kind of pitched them on the sales piece and they're like, oh no, more of our volumes, customer support. So we looked out in that regard, and then we were able to kind of narrow ICP. Uh and then Nailing ICP With Real Conversations SPEAKER_01 18:55 I think another kind of big moment was later that year because like how we actually scale to our first million dollars AROR came from cold outbound. So we would set up like hundreds of email inboxes using LEM lists, pull the list from Apollo. Once we knew the kind of ICP, once we knew the person in the company, and like we're having success with like enterprise B2C companies and VP of operations in those companies, like was like that were having most success. So built out like messaging around that, pulled lists in Apollo, set up like hundreds of email variations in LEM list, wound up those email domains. So it'd be like try solidroad.com, get solidroad.com. So we weren't burning our primary domain. And yeah, and I was looking at the stats before this, like, even like we were sending like 500,000 emails. I was looking for like that first million error, we sent 500,000 emails, we got 5,000 replies and 250 meetings booked, and then like a 20% conversion of those meetings booked, which was 40 customers and an ACV of 25k to get to a million dollars air or like that's how we worked from. And so, like, and I think one somewhat outlier deal with higher ACV that we got late in 2024, which was like great for, because I'm a big believer, I come from sales background, as I said, it's like it's all about case studies, testimonials, and social proof. So we closed crypto.com at a like we were an enterprise customer, they're also financial services. So, like, even back then, like selling an internal training tool using AI, people were very security conscious. And now you look at all the stuff that AI is doing, like automating tasks and like even being customer-facing, it wasn't like that even in 2024. So getting through like security and procurement of crypto and then having them as like a reference customer made it a lot easier to close the next steals coming in because it's like, okay, their financial service company, if they've gone through their procurement process, you know, they have SOP2 type two. They've always thought 27,000 and one, like they're obviously in a good security posture to work with. Did they come outbound like from that 500,000 email campaign? That was one that came from an investor intro. Pablo Srugo 21:00 We have tens of thousands of people who have followed the show. Are you one of those people? You want to be part of the group, you want to be a part of those tens of thousands of followers. So hit the follow button. So let's walk through like for that million dollars. I want to go deep on the outbound. You just kind of you went through the surface level stuff. So and I think I think it's just something that in theory anybody can implement. And it comes down to like just you know, execution, right, and doing it right. And you've got to have enough of a TAM that you can send half a million emails. But we'll go through that in a second. Just first, when you're talking about that first million RR, where the product that you had, which was role-playing around customer success, where was it mainly used? Was it a training use case? Like was what was the main ROI of the product at that time? SPEAKER_01 21:39 Onboarding, reducing RAM time. Pablo Srugo 21:41 So this is you hire a new customer service rep and you just need to get him trained up. You do the role-playing to do that. SPEAKER_01 21:46 Yeah, because managed attrition is so high in contact centers in particular, where they're seeing like 100% turnover year over year. They're hiring in batches of 100 agents at a time. So getting the agent proficient and saving labor costs. For every support org, scale support org, you probably have one trainer for every 30 support agents and like one QA analyst for every 15 to 20 agents. So we were kind of focused on that. Like the OROI was reduced time to proficiency, like basically cutting that in half. So people were ramped a lot quicker. And then trainer costs. So like you wouldn't need as many trainers because this is automating a lot of the role of the trainer. So like headcount savings was very easy from like our ORWAL calculations to show during like a POC or a pilot in a couple of weeks. And they were the kind of two things that hit home the most. Cold Outbound To The First $1M Pablo Srugo 22:34 So let's do it like this let's talk about this getting a million in ARR through outbound. Imagine, like, I'm a founder, I come to you, I'm like, Mark, I got this product. I'm telling you the ROI is clear. Like I've spoken to some customers, you know, they love it, whatever. I'm ready to go. Take me step by step of the things that you would do to get me to a place where I'm booking, you know, hundreds of demos. SPEAKER_01 22:53 Yeah, I think you have to do the manual stuff at the start to kind of to tinker the messaging. So, like what I would be telling founders to do is like start with social selling on LinkedIn and like be as personalized as you possibly can from like voice notes to video messages. Like true manual, like this, do this, like the stuff that doesn't scale, right? Do stuff that don't scale, yeah. And like go really deep there to find out like what messaging is resonating, who's the persona, like do a lot of work on finding out who your ICP is. Because as I said, like now I can tell you like our ICP is B2C enterprise companies scaling past 10,000 support tickets a month that use an outsource BPO and have an AI agent live. And like to your point, like we still have a massive TAM. Pablo Srugo 23:39 It's like get like really firm on your ICP. How did you tell me about that? Because I think that's critical. Like you can send half a million emails to the wrong type and you're gonna have way, your commercial. How did you do that at the beginning? Like, how broad did you because you have an idea. You always have an idea. You're like, no, no, I know my ICP is this, right? Like, how much did you just focus on that versus just go, well, let's assume I know nothing, blank slate, and you just kind of hit up a bunch of different people. Like, where did you find that middle ground? SPEAKER_01 24:02 I spoke to lots of customers, basically, or prospective customers. Like anyone who would speak to me, I would speak to from my own network. I would say, like, hey, will you introduce me to this person, that person? So, like while Patrick was building the product, I was on lots of discovery calls essentially, trying to find design partners, trying to find people that would actually test the tool. So there was a lot of that. I would get lots of learnings from those calls, and then take that messaging to find similar people who I had better conversations with to then try find because it's it's very easy to if you talk about like the mom tests, and you can find people in your network who are gonna be like, yeah, this is great, but like I actually needed to verify it with people I didn't know. So then I take like the best conversations, their roles in those companies, then go after similar people completely outbound on LinkedIn, get super personalized with it. The messaging that would lead to like higher kind of conversion rates from first calls booked, I'd be like, okay, put that in a Google Doc. I know that's a good message. I kind of build up a bank that way. And then when that became somewhat repeatable, I scaled it. Pablo Srugo 25:01 So that's really helpful. Do you remember like people that you thought should work but actually didn't work? Do you know what I mean? Like on the ICP finding side, like things that you you ultimately only found through these reps. SPEAKER_01 25:12 I spent a lot of time and like selling to other B2B SaaS companies coming from a B2B SaaS background, and I was just like a complete waste of time. Like it was really the big eye opener for me, is I and it seems obvious in hindsight, was like B2C companies that actually have so much conversation volume that they really they've so much support, they've so many conversations coming in. So that was the kind of big eye opener for me that's like, okay, that kind of changes everything. Pablo Srugo 25:34 So I like that. And then on the messaging front, you mentioned like as things worked, you would kind of put them in a bank. Do you remember some of the subtleties and the messages that you found started working versus maybe the ones that seem to work less? SPEAKER_01 25:45 Yeah, this is kind of the advice I give to salespeople as well, or like people who are doing fender-led sales. It's like you kind of need to remember what is the purpose of the message. Because a lot of people it's like, if you actually take the mindset of like, this message is to close this customer because I need my first customer, it's like it's never gonna work. So I felt like it was almost like putting too much detail and like why we're amazing. Whereas like the goal of the message is to get a call, like, or get a reply. Even if you take a step back, it's like the goal of the message is to get a reply, and then when you get a reply, it's to get the first call, and then you can kind of work from there. And so it was really just like simple stuff and like lean on the fact of like, hey, I'm kind of building this startup in this space. I'd love to get your thoughts and your feedback on the version one of the product. And a lot of people are happy to help startups, and like those like initial conversations where it is really just like feedback, you're not trying to hard sell them. Oftentimes they then turn into like, hey, like, you know what? You should talk to John on our team. I think he actually might be able to test this out with like a small cohort of users and give you some better feedback than me. So I like went really high of CEO, COO, and like played ignorance of like, I'm a startup founder, please give me feedback. Then they push it down the chain. And then funnily enough, when we actually look back at some of the the deals we closed, I you look at like how the first meeting got booked, that it's like from the CEO, a co-founder of the company. And like by the time it actually gets the person who procures the software, they probably think they've been told to buy this tool because it's come from their CEO. So I think that is uh something that's quite helpful. If you can get in like at the highest level and work down the chain, uh that's a good starting point. Pablo Srugo 27:18 You know, the the part about figuring out what you're trying to accomplish with the message and kind of and breaking it down in stats is often lost, I would say, because you need to have something simple and sharp. Obviously, everybody's busy scrolling, whatever. And if your goal is to get a sale, like you just how can you accomplish that in one line? But if your goal is just to stop the scroll, right? Like get a reply, then it changes how you're gonna say it. Okay, so that's phase one. Like you've done that, you're like, okay, I know that my SCP is not B2B SaaS, I know that my SCP is B2C, it's this, that, that. I know that these kind of messages work. So I was step one. What's step two? SPEAKER_01 27:51 Step two is then scalus. I, as I said, we set up the kind of the outbound engine um with the email domains. And we tried to do like multi-touch as well. So uh I would try like cold calling as well. Quite difficult to get numbers, especially in Europe. I would use like HeyReach as well as LEM lists. So Hayreach would do like a LinkedIn connection as well. So I was trying to still do multi-touch, but honestly, like all the replies came via email. Pablo Srugo 28:18 What tools did you use? Like, did you use clay? You said you mentioned Apollo, like did you try a bunch of different things and you chose one for a reason? SPEAKER_01 28:24 Yeah, like I I'd kind of tested probably every sales tool known to man at this point, from like HubSpot sequencing duel to sales loft, uh you name it. So I really just went with like the cheapest tooling possible at the time. There you go. Price wins. Yeah, we used Apollo to get the contact information and then push that into Lem list, set up multiple like uni inboxes in it was like a union box with multiple different variations of the email, um, and started with like one email address and then five email addresses and then 10 and then 20. And yeah, we just like put fuel on the fire because I think there's a good book, I forget who uh wrote it like called traction, and it's all about the various different traction channels you can you can use. But like when one works, like you should double down on that. So when it was working, we're like, okay, like how do we send more volume, send more volume? And I know sometimes this can kind of go against the grain where people are like, Oh, you're burning your TAM, but like people get so many emails now, they're not even gonna remember if you emailed them six months ago. So I think people can overthink that to a degree. Pablo Srugo 29:23 That's a good point. I mean, it's true. Like, of the emails that you don't reply to, how many do you remember three months later? And the answer is probably like none. That's the reality, yeah. SPEAKER_01 29:32 Zero. And like without band, I'm a big believer, it's like the right message to the right person at the right time. So a lot of it is look anyway. So you need to have the volume to get the look. Pablo Srugo 29:40 Does that mean, by the way, like TAM? It seems to me, if you're gonna run a cold email campaign, you have to have insane TAM. Like, if you're in a market where there's even like 10,000 customers, it's like you can't really do this. SPEAKER_01 29:51 Yeah, I agree with that. Like customer support is like 1% of global GDP, it's the same market size as advertising. So, like uh there is a massive TAM there. And I think I started kind of far and wide with the personas, so like VP of operations head of support. And then again, when I saw success with certain verticals like e-commerce and financial services, for example, I then would like put all the email volume I had into those verticals and not just keep general. You know what I mean? So, like I'd run specific campaigns in specific areas if they were having more success, or uh we do like campaigns for specifically to BPOs because they could resell the tool, and 30% of our revenue now comes from BPCO, BPO partners who are, for people who don't know, business process outsourcers who are like outsource call centers, contact centers, your tech Mahindras, Telest Digitals, uh teleperformance concentrics. So we work with these companies that kind of resell our tool into enterprise companies because they've got the keys to the castle already. So that became a distribution angle in itself. That partner here is a several BPO. We close more of the uh BPOs through cold email, signed MSAs with them, the likes of concentrics, who are like a 50,000 person company. I think they brought on five AI vendors this year, us being one of them. Pablo Srugo 31:03 First of all, in those emails, are you trying to get them on a call or are you trying to get our what was the goal of most of those emails? To get them on a call. SPEAKER_01 31:09 Just try to get them on like a demo, basically. And I do like discovery and demo on the same call, and that would be the main goal. That was the CTA. It was just like, are you free for a quick call? And as I back to the point of like when we actually had when we had the messaging down and we had some case studies, it was easier to scale it. So it's like, hey, we are helping crypto.com do this, we are helping Partner Hero do this. Pablo Srugo 31:29 I was gonna ask, though, are those the best emails where you can just name drop a customer that they'll know and then you just get social status that way? 100%. When you have a crypto.com, of course, you should milk it, right? But what was working best before that? What were the sort of things that and maybe tell me more about the email, right? Like everybody gets so many emails these days. How crazy do you go on personalization, on length versus just being short and to the point, like or being alarmist? Like you see some stuff on LinkedIn these days. I saw one the other day, it was like the headline was like, Your mother's dead. No, just kidding. I was like, obviously, it's crazy rage, mate, but you get what I'm saying, right? SPEAKER_01 32:03 No, I absolutely hate that. They're the worst of worst, so I hate that stuff. But uh, I think like my email like copy is like, hey, first name, I'm Mark, building solid road, solid road is this, and we're helping companies like XYZ do this. Any interest in learning more, would love to show you a personalized demo of how we can help your company. Let me know. That's simple. Simple, basic, okay. It's like really like basically why I'm contacting you, clear OROI, case studies, testimonial, social proofs, call to action. Pablo Srugo 32:32 And so that's where you're really going after volume in the sense of like you need the person to be the right place, right time to be like, oh wow, I actually was thinking about this kind of thing. Yeah, sure, let's talk. SPEAKER_01 32:41 Yeah, and I think like that's how we got these customers, and then like how we grew those customers is probably another thing that I have a strong opinion on. Onsite Customer Work That Drives Expansion SPEAKER_01 32:47 And like our net revenue retention last year was 186%. So, like what we did then was we would go meet these people in person. So, like day one, first office hours where we got into YC, sat with our group partner, Brat, and we're talking about customers, and we were saying we have this customer podium, and like they're really using the tool heavily across different teams, but don't know them that well. And he's like, Yeah, like podium are YC company and they're based in Utah, like go book a flight and just like try get a meeting with them. So we're like, Okay, cool. And they were like, We're messing them, saying, Oh, we'd love to meet in person, and obviously people are busy, they're kind of ignoring it. So then we just like doorstep them basically. We're like, Oh, we're actually meeting these other customers, uh, potential customers in Utah. We'd love to come in. And then they were the most hospitable people ever. Ireland gets a good name for good hospitality. I've never seen anything like it in Utah. So they kind of brought us into their office. Like we walked in, we were introduced, like the solid road guys, and like one of their teams got up and started like clapping again. Patrick was getting emotional in that in that regard. Don't know if it was like being endearing or just joking, but either way, we appreciated it. And we kind of parked ourselves in in one of their meeting rooms for three days and like met with every single person who's using the tool, got feedback, and then we just like again when we saw how impactful that was on usage and like building relationships with people, that it wasn't just like a Slack connect channel and didn't know anyone, we'd like scaled that. Pablo Srugo 34:06 What does that do? Yeah, tell me a bit more about like because obviously the time investment in going to visit a customer is massive between the flight and the hotel and this and that or whatever. The reason that you get more is is what exactly? People see you and they're just more willing to jump into a room and chat with for you for 30 minutes. Your onboarding's better. Like, what improves as a result of spending that time? SPEAKER_01 34:26 Yeah, I think like onboarding and activation, it's like there could be small bottlenecks in the product that you don't realize because like we're not a self-served product, we're a sales-led motion, and there's things in our product that like maybe we just become blind to that become bottlenecked to like adding new users or someone getting fully activated in the tool. So it was really being able to see that first hand and like click buttons side by side. So I think activation's a big one. Pablo Srugo 34:48 And then yeah, just like the actual relationship, like it's literally hand-to-hand combat. Like at scale, you're gonna have to figure something out. But it's like, okay, this is pressing you off cool. Like, let's fix it, let's find a way, whether it's software or just me you telling you, or whatever it takes, let's just get to the point where like you're almost forcing, you know. We always talk about that aha moment, like you, that value moment where it's you know, seven friends on Facebook, whatever it is. Like, how do you get people to that fast? And you know what? Like, just show up at their office and like hand hold them all the way till they get there, and then you're like, Yeah, cool. Now who's next? You know what I mean? Like now you're good to go. SPEAKER_01 35:17 Yeah, like 100%. Obviously, you need to have ACVs to justify like our ACV are are sitting at just below like 100k now. Pablo Srugo 35:24 But even back then, like that, was that a hundred K customer or was that more like 20K? SPEAKER_01 35:28 No, like 20, 25k. Pablo Srugo 35:29 Yeah, at the beginning, it's like whatever, as long as they can grow into that. SPEAKER_01 35:32 100%, 100%. Um, and I think the one good thing that really came from the first batch of on-site visits, because like I have uh a note in my phone of all the flights I took last year for customers, and I took 56 flights, and based on like half my time was in Dublin, and then I moved to San Francisco full-time in in September. So taking transatlantic flights as well to Nashville and Connecticut and all these interesting places. Pablo Srugo 35:55 But what percent of your time, total time, you would you say is then invested in just you know being with customers? Then I actually don't have the the honest figures. It was like a big proportion, like must have been like 70, 80 percent. I mean 56 flights, like it's just even between that. SPEAKER_01 36:09 Yeah, and like you look at because like we would have we would have been five people when we finished YC and closed our our seed round from first round capital. And then even when we closed our series A in January of this year, like signed the term sheet officially closed in March, we were still only 12 people. So we're now at like 28 people. So, like, yeah, I was a like I was doing founder-led sales for a long time we have a stood-up sales team now and like a sales leader, but yeah, it was like yeah, the majority of my time. And I still do everything I can to fly to meet customers. We have two people on site in Madrid today with Fever, one of our customers who do like alternative ticketing, kind of like a ticket master competitor, and Ryanair, who have one of their large contact centers out in Madrid. So we have an engineer and a sales rep in Madrid right now. Although the ACVs didn't necessarily justify it at the start, what it enabled us to do is everyone was signed up on a month-to-month Stripe link, and we were able to convert all those people to annual contracts or multi-year contracts, which is obviously very important. Pablo Srugo 37:04 My next question was around the NRR. You mentioned NRR over 180%. You talked about going into the office as a great way of onboarding an activation, which is obviously like it's like the foundation. Like that's what you need for people to use it, and then therefore to at least renew. But how do you go from a 20k CV to a hundred K C V? Is this in-person motion a key part of that? SPEAKER_01 37:25 We added more features to the product, which also helps. So I think that was one big component. And then we charge based on volume. So like more volume through the system leads to higher ACVs. So it was really like getting more usage across the board from different teams, but I think as well adding more features and functionality to the product that we could upsell. Pablo Srugo 37:44 It's interesting, right? Like you think about, I mean, adding more features is something that, like, you know, who does who's not doing that? Everybody's doing that. But if most founders, I mean at least, and when we look at retention, we look at whether it's gross or net doesn't matter. Failed onboarding is always top of the list. Top of the list in terms of the ones that churned fully, the ones that aren't really growing. It's it's always, oh yeah, they we just didn't onboard them. We didn't onboard, you know, within a week or a month or whatever that threshold is for you. So there's something where you're saying it's like if you invest the time up front to make sure you get the activation and the onboarding, you're obviously going to build more features. Everybody's gonna do that. It's table stakes. But if you've got 90% of the people that should be using it, actually using it and using it often, your odds of them then growing into the rest of those features and lift, not just renewing, but then lifting the ACV, it's like you think about it at the time of renewal, you know, like how can you grow this account? But really, a lot of that is preset at the time of the sale and the onboarding and how much success you got at that stage. Yeah, 100%. SPEAKER_01 38:39 And like if you look at like, as I mentioned, we signed annual contracts, but all like we had so many instances of like renewing those contracts early, mid-cycle based on the usage going up. Like we had overages and then people like, hey, like, can we just lock in this volume now? We're like, yeah, cool. So like we'll just renew the contract early and now it expires in October next year, not January next year. Um, so there's a lot of that. Um, but yeah, I completely agree with what you're saying. It was like because we were working with large companies, it makes sense to onboard them properly, activate them, and then yeah, we're gonna obviously build more features, stay close to them, find out more pain points, and more like tools in the stack that we can actually replace and grow A Time-Boxed Series A Raise SPEAKER_01 39:17 from there. Pablo Srugo 39:17 You raised a $25 million Series A last month. How many people were you when you raised that? SPEAKER_01 39:23 12. Pablo Srugo 39:24 How do this is something else that I find is a challenge. It's you know, people talk about, and I don't know how you're raised went, so we'll we'll get into that, but a lot of people talk about you want to raise using you wanna have a process, you know, you want to meet a lot of ECs so you can run it, you know, on a process, get the best terms, find the best partner, etc. When you're 10 people, 12 people, 15 people, which is normal for Series A, and especially when you're so sales focused and you're meeting customers, like how did you give it the time to fundraise without, you know, you pull out and all of a sudden your sales and you're on board, everything starts falling right as you you want it to go up. Do you know what I mean? Like, how did you find that? How did you make that happen? SPEAKER_01 39:59 Yeah, I think like honestly, I was lucky and fortunate that we got a term sheet within six days. So and the process was actually quite quick, but I had like done the prep up front, kind of did the prep over the Christmas break a bit when I had a bit of downtime, and then we went out to raise the first week of January and just ensured, like leaned on first round capital to make intros, YC to make intros, had the calendar completely stacked. Like I'm a big believer in like you're either fundraising or not fundraising. There's a lot of like, oh, I'm doing these coffee chats, and like hopefully we'll get preempted from this coffee chat and all these. It's like you're fundraising, you're fundraising. So um made sure it was like very time box that done the prep, deck ready to go, spoke to customers ahead of time. Cause like at our stage, it's all gonna be down to like customer referrals and how happy the customers are using the product. So like call them all over the Christmas break, being like, hey, like, do you mind if I put you down as a reference? Gonna go ahead and try Razar Series A. They were all more than happy to do so. So I just had like the data room ready in Docksend, like our like head of operations and finance, like like he's a wizard with Excel, something that I'm not the best at. So like he was like building out all the models, getting the data room ready. We kind of like war game that piece, worked your first round of their team to get the deck in a good place. They had like an amazing team that support there. Um, and then ran customers over the break, and then it was like ready to go. Calendar was probably blocked with like you know 12 meetings a day for that first week. Pablo Srugo 41:22 So you did you still did probably what 30, 40, 50 meetings sort of thing? SPEAKER_01 41:25 Yeah, yeah. And considering like follow-on meetings and stuff like that, I think it was, yeah, about 40 meetings. Pablo Srugo 41:29 And just remind me, we talked about the the millionaire R. Like when did you hit a millionaire R? SPEAKER_01 41:34 The night before demo day at YC, which was that would have been March 25. Pablo Srugo 41:40 Okay, so that's the other thing. Like you're because the series A bar is only getting higher. I think median series A is days like three and a half million AR. So that's the other thing. Probably by if you you hit a million a year before, you're probably doing you know, in that mid like seven-figure range or so when you got three series A. Perfect, man. Well, listen, I think, I think we'll stop it there, dude. Like we we got we got a lot of meat. Nice. I think if you're a founder listening, there's a lot of things you could take from here and implement tomorrow. So thanks so much, Mark, for sharing your story and like walking us through, you know, the details, because the details are the things that everybody knows high level you're supposed to do. And when it comes down to executing, it's really all about the details. So thank you for sharing that with us. SPEAKER_01 42:18 No worries. Thank Closing Advice And Sharing The Show SPEAKER_01 42:19 you very much for having me. And then, of course, if like there's any founders that are listening, you can reach me directly on LinkedIn. Always happy to help. Pablo Srugo 42:25 You remember like the first person who told you about Bitcoin? The first person who told you about Uber. You want to be that person because being first is cool. So be a cool person and tell your founder friends. Send it to them on WhatsApp, put it in a WhatsApp group, put it on a Slack channel, let people know about the show, let people know about this episode. Don't let somebody else beat you to the punch and share it with your founder friends first. Remember what Ricky Bobby said if you ain't first, you're last.