He worked out of a police department for free for a year—then built a $6.8B company. | Ben Rudolph, Co-Founder of Peregrine

Ben Rudolph (00:00:00) : We're interested in learning more about how you solve these cases. Could you take us along as a partner? We'd love to learn more and he said yes. He invited us to the police department, he gave us a bunch of background checks, basically handed us this book and he's like, all right, let's see what you can do. And we got to work, and basically worked out of that department every day for eighteen months. To answer your second question first, our average ACV right now is around $250k. I always tell founders kind of the same thing, go sit with your customer. Prove value, that is the thing. If you're in an apartment or things like that, get out of that apartment, go to the customer, try and find a situation where you can build alongside the customer. Previous Guests (00:00:40) : That's Product Market Fit. Product Market Fit. Product Market Fit. 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. Pablo Srugo (00:00:52) : 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 out 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. Ben, welcome to the show, man. Ben Rudolph (00:00:52) : Thank you, Pablo. Happy to be here. Pablo Srugo (00:00:52) : So you started Peregrine just over eight years ago. You just raised a $250 million round, at a $6.8 billion valuation. So clearly things are working and I would say in your case more than that, every founder, at least that I meet. Typically they want to add value, change the world, however you want to make that sound bigger. But in your case, the impact you're having is very clear. I mean, you're helping law enforcement solve crimes, you're helping fight wildfires, these are pretty meaningful things. So we're going to get into all that, what Peregrine is, what it does. But we start always, because this is ultimately about product market fit and how you found product market fit. So let's start with that. What is the moment for you when you felt like things were really working? When you felt, okay, we have product market fit or something like it, at least? Ben Rudolph (00:01:55) : Yeah, so the story of Peregrine is long and, you know, we got started by embedding in the back of a police department. We were working with detectives solving homicide cases, sexual assault cases, armed robberies, these types of things going in day in day out. We were there for about twelve to eighteen months and building product working on these cases. And the moment where I really started to feel like, okay, we're actually building a product that is adding value and being useful is there was this complex homicide that they had been working on for a few years. It was gang involved. There were lots of burner phones, rental cars, and a couple people ended up getting killed. And they had called us to basically ask for help on finding the next lead on this case. And seeing if we could help solve this. And that was when I was like, okay, we're at least providing something that they're thinking of us to solve this case. And that case actually moved forward to the point where we were expert witnesses in the trial that ended up solving that particular case. Pablo Srugo (00:02:57) : But your product helped solve that case? Ben Rudolph (00:02:57) : Yeah, that's right. Pablo Srugo (00:02:57) : That's pretty wild. What is your product? What does your product do? Because again, the fact that you're solving cases, you're also doing wildfires, you touch a lot of different pieces. So what does your product actually do? How did you help solve that case, for example? Ben Rudolph (00:03:12) : Yeah, what we saw when we came to that police department is there's been a proliferation of technology point solutions for all sorts of different types of data collection methodologies, and they weren't able to actually leverage that information to achieve their goals. And in this case with the detectives, they were trying to solve cases. So our technology basically put all this data into one current complete asset. They were able to join other data sets together. When someone commits a crime, you're able to basically request information on that particular time portion, get cellular data. Peregrine's platform puts all that data into a current complete data asset, transforms it, enriches it, and then, provides applications on top of it to enable users to explore and find insight from that information. However, I'd really say that I think of Peregrine's product as fifty percent of its technology. It's that platform that allows you to get insight, build workflows, and do that type of technological work. The other fifty percent of our product is really the way we deploy and the way we partner, and work with our customers. And I think, that symbiosis is what made Peregrine successful in the early days and something that we've tried to hold on to. Pablo Srugo (00:04:25) : Maybe to bring it all together, you go to that example where you solved that cold case. Where you helped solve it. As a result of your technology and the service layer and the partnership, and everything, what happens? What are you able to uncover? I don't know if you can talk about that specific example, but that would be ideal. But what can you specifically uncover that maybe before was just not possible to figure out? Ben Rudolph (00:04:45) : Oftentimes when you're trying to solve a case, you're trying to tie a person to a location at a time and place. And in this particular case, they were able to marry a bunch of different cellular records. It's hard to overstate how complex and varied this information is. Think dozens and dozens of Excel files, different time zones, messy data. Being able to connect that all together, visualize it, understand where different phone numbers, people are in relation to, like, geospatially and from a temporal perspective, and marrying that together. And understanding, okay, who is here at this point in time, who is here at that point in time, and just having that information. And understanding the movements of the people involved in the crime is critical to actually moving the case forward. Pablo Srugo (00:05:28) : Many times I'd say when I talk to founders of companies like this. That are very technical and hyper focused, for example, I talk to somebody in cybersecurity and they're like, yeah, I used to be in the armed forces or I used to be a hacker for IDF, like things like that. I'm looking at your profile, I'm trying to make sense of it. How do you end up here? How do you end up in this company? Ben Rudolph (00:05:45) : So my background, I went to Stanford to take a year of science. I spent every summer working at different Silicon Valley companies and I really took away from that experience that I wanted to build technology that had meaningful impact on communities around us. I spent a lot of time working at tech companies where I didn't really believe that that was true and so after school, I went and worked at the UN Refugee Agency. Spent a bunch of time deploying technology in very hard to reach places, solving issues that are similar to the issues that I solve today. Which was the UN Refugee Agency has extremely disparate data and it's very difficult to understand how different interventions are working at different refugee populations. I joined a similar type of company that was deploying technology in hard to reach places, doing data collection in Africa and India. Partnering with governments to have interventions on one. For example, we worked with the Indian government on ensuring adherence to TB drugs and both these experiences, I took away a couple of things from it. But one, it's really difficult and challenging to work with the government. It's slow, it's bureaucratic. Pablo Srugo (00:06:58) : I was gonna say, it's not the obvious place that you then, launchpad for entrepreneurship. Ben Rudolph (00:07:02) : Totally, but if you're able to do it and if you're able to partner, and you're able to do it well. I think the impact there is real, and I saw that. And so, what gets me really excited about Peregrine generally is we found this way to partner with our cities, our states, our counties, our federal government to build technology. Best in class technology to the public servants, the folks who often get the worst technology, and give them really great technology to do their jobs better. And so, that is the frame of mind that I've had. We got started in law enforcement. We're building a much bigger platform and much bigger technology than that focused area. Pablo Srugo (00:07:37) : Tell me more about the origin story. How do you go from, you know, building and selling software to governments as part of another company to deciding to start your own thing and specifically Peregrine? Ben Rudolph (00:07:48) : Yeah, actually a lot of it goes back to my cofounder. We did gymnastics together in college. Spent a lot of time, twenty, twenty five hours a week. Someone who I felt was a really great partner. We always wanted to start a business together. We had talked about it in college. He had gone and spent time at Volunteer. We were on what I'd call maybe dual tracks, where he was working with different types of government institutions and deploying software in very hard to reach places. And I remember in 2017, we kind of linked up with a very similar perspective on how we could partner with these kinds of important institutions to deliver better outcomes and that's really when we linked up. I moved across the country to come to San Francisco and really got started kind of in the back of my apartment in 2017. Pablo Srugo (00:08:38) : So was that born out of what you were doing? Because the idea is very generic at that point, right? It's like, let's take data together and help law enforcement, for example. Was that kind of the first version of the idea? Ben Rudolph (00:08:47) : It was definitely the first version. I think we came to the problem with a very open mind and from first principles. When we went to partner with the first agency we worked with, the San Pablo Police Department. We didn't have a prescriptive solution. We had an objective, which was to help these detectives solve the cases that they were working on and then we worked backward from there. Pablo Srugo (00:09:09) : But you somehow knew that it was a problem. Obviously everybody wants to solve more cases, but you knew that they were probably not making the most of the data that was available to them for reasons that you saw like at the UN, et cetera? Ben Rudolph (00:09:21) : It was actually just, because when you go to solve a case, you get a bunch of data that you have to sift through and sort through. And we're like, wow, this is really hard. And it was there where we're like, okay, we need to build something to actually process this information. And then, we started tying it to some of their record management systems that they already had and connecting those dots. And those are the very initial steps when you're trying to solve a case. Obviously, there's some piece of this where we came from a background, where data integration was a very important problem and something that was front and center for us. But it was also very much a first principles, how do we solve this problem for the customer? Pablo Srugo (00:09:54) : You know, you want to have impact. So I get that that's kind of in the back of your mind. But what pulled you towards law enforcement in the first place? Ben Rudolph (00:09:56) : I think public safety is an incredibly important problem. I spent a lot of time in countries that had no functioning public safety system and I personally believe that, doing public safety correctly and right is a very, very challenging and hard problem. And I was motivated to work on that problem, and dig deep on it. Pablo Srugo (00:10:20) : So both you guys just kind of, you just cared about public safety. You just decided, let's talk to some people. See what's happening in that world, see what problems we could solve. Ben Rudolph (00:10:27) : When we initially set out to find a partner, we were knocking on doors. We actually researched a ton of different folks in the Bay Area, different captains, different leaders who might be open to this type of partnership and our methodology here was really. We looked at essentially the org chart of these police departments. Who are the number two, number three in charge? They were maybe a little bit younger. They were leaned into technology. Isolated that list, we did a bunch of research on these folks, what kind of cases they worked in the past, and then we left very thoughtful messages. We reached out to them, and we were persistent in that. Pablo Srugo (00:10:27) : Were you asking them specifically at that point? Ben Rudolph (00:10:27) : You know, at that point it was less of a question and it was more of a, hey, can we have a conversation? I would love to learn more about how you do your work and so in our specific example, in San Pablo, there was a commander at the time. Commander Brian Bubar, who responded to our reach out, and we were essentially like, hey, we are really interested in this case that you solved. We were interested in learning more about how you solve these cases. Could you take us along as a partner? We'd love to learn more and he said yes. He invited us to the police department. He gave us a bunch of background checks and basically handed us this book. And he's like, all right, let's see what you can do. And we got to work, and basically worked out of that department every day for eighteen months. Pablo Srugo (00:11:51) : So you went to them and just kind of said, I guess I'm just not understanding if it was a pure discovery, like, hey, we just want to learn the space, you know, you're an expert, whatever. Or whether you came at it as saying, you know, we want to work on something here. This is like the idea we want to do. Can we do it with you? Which of the two messages are you going out with to all these initial commanders? Ben Rudolph (00:12:11) : We never came to them with, here's a technology that we want to build for you. It was always, we want to help you solve cases and we especially want to work with your detectives to do that. And that was, the ethos and mentality that we had. I think, especially in the early days, a lot of these government agencies have a ton of vendors who are like, hey, here's this technology. You want to use it? And it just doesn't land well. Pablo Srugo (00:12:38) : Why would they let you in? You know, you can't just like, yo, I want to help you solve a case. Like if you have a product or you're like, hey, I just want to have a chat. I get both of those, but I don't have a product and I don't want to have a chat. I just want to help you solve cases. They're like, yeah, come, come in, here you go, solve my case. How does that happen? Ben Rudolph (00:12:54) : Yeah, he definitely took a chance on us. We were very open and transparent with him in that we want to build a company. We were looking for folks to learn from and wanted to be design partners with, and he was open to that. And so, we tried a lot of people before we got a yes here. So it's definitely challenging. Pablo Srugo (00:13:15) : Did you do a lot of the customer discovery before this, before jumping in and starting to try to work with this person to help them solve a case? How much did you already know going into it? In terms of what the world was like? Ben Rudolph (00:13:26) : Yeah, I mean, we did as much as we could, right? We read all these cases that he had worked personally. We learned about the law enforcement structure, police department structure, how they work, how they operate, how do warrants work, these types of things. But you really, in order to make that jump to being an expert, you have to work it and so that was our approach. Pablo Srugo (00:13:46) : And so then what happens? So he lets you in, what do you start doing at that point? Ben Rudolph (00:13:50) : Yeah, he gave us a room in the department and anytime there was a case, they would essentially treat us as crime analysts and they'd be like, hey, we got a new homicide in. Here's what we know about the case. Can you help us with it? And we would be like, sure. And then, so we would sit there all day, poring over these files, trying to figure out what happened, pinpoint a phone number. Pablo Srugo (00:13:50) : Just manually? You're basically free labor for these guys, or you're building tech to do this? Ben Rudolph (00:13:50) : Definitely free labor at the beginning. I mean, I'm a programmer, so I was writing software to do this. So that was definitely helpful, but this is a job, right? This is what they would do. They would sift through this many times, very manually. Pablo Srugo (00:14:29) : So step one really was finding somebody to let you do the job for free. Just so you could learn the intricacies, the subtleties of what the job was. Ben Rudolph (00:14:35) : Yeah. Pablo Srugo (00:14:36) : It reminds me of, you know, I had a company on here a while ago. A company called Ada, and the way that they built the product, which was a chatbot. Again, we're talking 2015, but it was by working as customer service agents. Literally doing the work, responding and getting hired by seven different companies. And then, just learning the job that way and starting to build tools to automate themselves out of that job. And that was ultimately it, that product. Is that similar to what you guys did? Ben Rudolph (00:15:02) : Yeah, exactly. That's exactly the way I would frame it. It was the purest form of method acting. Pablo Srugo (00:15:09) : Tell me a little bit more about, because this is the key, right? If you want to automate something or help transform, let's say, an industry or whatever. You do need somebody to let you in. You need somebody to give you all that exposure and especially talking about law enforcement. It's not trivial, I don't think, for somebody to do this. I mean, you mentioned a lot of people said no. Why did this person say yes? I mean, fundamentally, I'm just thinking about, two people with no. Let's say, law enforcement background. They don't have a product. I'm going to let them in. I'm going to give them background checks. I'm going to give them all sensitive potential information. I guess, worst case, they don't help me. Best case, they do but it's kind of, anyways, what's the driver there? Ben Rudolph (00:15:45) : I think about that question a lot. I'm not sure I have a satisfying answer for you as to exactly why this person said yes. But I do think the way we crafted our message, the way we wanted to be, we had a service orientation approach, and I think that resonated with this person who was very technologically forward. And we told them, we were your scientists and we wanted to learn the space, and build, and deliver great technology for him. Pablo Srugo (00:16:11) : They probably believed already that with tech they could do a lot more. There's just so many gaps and then just like, I don't have a budget, I don't have the time. And all of a sudden you two walk in, and they're like, yeah, okay, I could see this makes sense. Something like that, which is kind of why I have to go through so many. Because you need one that actually is already almost all the way there. Is that ring true? Ben Rudolph (00:16:29) : A hundred percent and I also think there is like an aspect to, great, I got two free crime analysts. Who know how to write software and work with Excel really well, that's great. Pablo Srugo (00:16:39) : Right, so you're working with these people. They're starting, they're handy cases and you're learning on the job. What happens next? Ben Rudolph (00:16:45) : We had that case that led to that kind of expert witness experience and we raised our first initial seed capital after that. And we got our first two or three person office. And we grew really slowly for the first, I'd say, probably three or four years. Word of mouth, our very next customer was the city next door and it was because the chief talked to that chief. And was like, hey, these guys are actually doing a lot of good work for us. And that word of mouth growth is, how we built the product and deeply empathize with the problem space. And had the opportunity to go that extra mile. I mean, we learned so much during that time. One of our first customers was Albuquerque, and I remember I was on site one time. And I was doing a case with one of the detectives, and there is this technology called ShotSpotter that detects gunshots. And I was pulling up these gunshots at time of the crime, and I was like, oh, my God, there's so many guns firing. Was there a mini war? What is happening? And the guy's like, no, no, this is. So there was a homicide, gun goes off, but there is this tradition or something that happens in Albuquerque where at the end of night, at the end of a party. Someone takes out their gun and shoots it in the air. Everyone else takes out their gun, shoots it in the air. So this homicide happened, gunshot goes off, people think it's related to a party happening next door. Everyone shoots, and so you look at the map, you're like, everyone's shooting their gun. What's going on? And so you learn these little bits of context on how they do their job, and that coupled with us constantly iterating the product to make sure that we could meet their needs. Pablo Srugo (00:18:26) : How big was the seed round that you raised back then? Ben Rudolph (00:18:26) : Yeah, back then we raised, it was either $1 or $2 million. Pablo Srugo (00:18:26) : Okay, so $1 or $2 million and this was? What's the timeline? When do you guys start and then when does the seed round happen? Ben Rudolph (00:18:26) : The seed round was nine or ten months after we started the company. Pablo Srugo (00:18:26) : Yeah, it's funny, comparing it to the stuff you see today. This is, and then you end up where you end up. Which is obviously hugely successful, but it's good to remember what I would always call that reality, right? I don't know that this can stay forever, but nine months to raise a million dollars today is like, oh my god. You should be raising, you know, ten, and you should be growing crazy. But this is how you ultimately end up with the real business. It's worth billions of dollars. Most of the businesses that end up even at this stage, which is still way less than one percent. Have a starting story that looks more like this than the highlights they see on TechCrunch today. Ben Rudolph (00:19:16) : You know, I really believe that to build big businesses. You got to stack bricks, and there are very few shortcuts in life. And I think the things that we've done that have taken a long time. Those are our moats, and those are durable. And so, you know, I don't know these businesses well. But if you can get $500 million in revenue in six months, you'll probably lose $500 million in revenue in six months. It's just, it's unclear to me what the moat is when you go super, super quickly. I think there's a lot of durability in being able to build your business methodically. Pablo Srugo (00:19:49) : We were going to talk about a couple of tactical areas, that we can kind of go deep on. I want to talk about one of those now, because I think it's related and it's going to be kind of the story to get to PMF. You were big on for deployed engineers a long time ago. I mean, now it's like the cool thing to do. Everybody does it, right? Back then it used to be called services and it was like, you should not do that. You want product, you want high margins, all these sort of things. But I mean, you were to the point that, if I remember correctly, when you were small. Ten, fifteen people, maybe half your team might get deployed for a month on a single customer. Let's walk through that. Tell me, how you did it, why you did it and how big was the services element? How do you still, obviously you ended up scaling? So I'm trying to understand all that, but let's start at the beginning. Just what was the idea around for deployed engineers? How did you set it up? Ben Rudolph (00:20:33) : I think the overarching principle for us in the early days and still today really is over investing for success. And Peregrine started with, deep roots in product development and implementation, and that's what we really wanted to be good at. And we weren't so good at marketing, and we weren't so good at these other functions. But those are two things where we're going to put all our points into this. And we really believe, in those early days that over investing in ensuring the customer is successful would pay massive dividends. And I think that was also, especially the case in government where it's such a high trust network. I mentioned that we got our second customer because the chief just told the other chief that these guys were good and trustworthy. That dynamic is very, very real and so, you know, we weren't really thinking too deeply about how do we build an infinitely scalable business. We were thinking about how do we make our customer really successful and so even in those early days, I remember one of our first engineering hires. We sent him to our second customer in Pittsburgh where he basically worked out of that office for about three weeks integrating their data. They had this like luau and he cooked a key lime pie, and he just completely got embedded with that department. Understood their lingo and was able to deliver a much better integration product for them. Because he understood the difference between different values in their database and could actually map all the disparate data, to how they actually talk and spoke within their department. Pablo Srugo (00:22:04) : We have tens of thousands of people who have followed the show. Are you one of those people? You want to be a part of the group. You want to be a part of those tens of thousands of followers. So hit the follow button. The concern, right? Always with this stuff and again, now, maybe it's less of a concern just because everybody's doing it, but it hasn't fundamentally changed the equation. Which is how much can you really do for one customer before? You mentioned you didn't really care about scalability, but that's still on a lot of investors and I think a lot of founders minds, right? hey don't want to get stuck being this consultancy like thing. Obviously, in your case, you were able to scale it. Maybe just tell me more about, is there a middle ground? Is there a balance? Is it just a matter of, at first it takes a long time but later on you have a playbook and it's faster, or is it still really custom? How do you manage that trade off between wanting to give your customer the best possible experience, which means hand holding, means going in, embedding, et cetera. But also wanting to be able to add a lot of customers, add a lot of ARR fast, which means, you know, holding those resources back to work on kind of core product. Ben Rudolph (00:23:02) : So I actually remember this moment where I told Nick, my co founder, all our engineers are integrating data right now. We can't build any product, we need some other strategy and, you know, I think in those moments, scarcity breeds innovation. And we started building this other platform that allowed people who weren't engineers to integrate data. And that was our first shift to, oh, OK, if engineers don't need to integrate data, that saves a ton of time. And so, we started building out this other function within Peregrine. Deployment strategy is what we called it and they were, think of, maybe studied computer science. Went to McKinsey for a couple years, wanted to work in technology and then they could integrate a bunch of data. Work with the customer. Partner with them to do that last mile configuration and I think we've always thought about that investment as a growth driver, not as something that needs to be optimized away. And of course, as you grow fast, you need to invent and you need to innovate in order to save time, and free up resources. That's something we're continuing to do and we always do. But I think our frame of mind on it is just maybe a little bit different. Pablo Srugo (00:24:15) : Well, because the impact is on speed and margins, right? That's usually where you would see it. Was that a problem, let's say, at least on the fundraising side back then? Again, today, I don't know that it is but back then. Was that a thing that people were like, oh, your margins aren't eighty five, they're sixty percent and whatever? Or maybe the other question is, what was the size of the ACVs? And maybe that justified it as well. Ben Rudolph (00:24:36) : To answer your second question first, our average ACV right now is around $250k. Pablo Srugo (00:24:43) : Which means, to be clear, back then it was probably smaller, right? It was probably $50k, $100k? Ben Rudolph (00:24:44) : Yeah, yeah, definitely back then it was a little bit smaller. Pablo Srugo (00:24:46) : So they're not, like we're not talking, you know, multi-million dollar deployments for the most part. Where it's like, yeah, obviously you're going to throw ten people at it. You're really playing this, you know, somebody's giving you $100k and you're putting three engineers on it for a couple of months. Like it's tight, is that true? Ben Rudolph (00:25:00) : I think that's true in the short term. In the long term, I'd say you probably have better, you have better margin. Because you have invested in that customer to the point where the technology is successful and if that technology is like deeply embedded in the way that organization works. Pablo Srugo (00:25:17) : Right, retention must be amazing, I would assume. Ben Rudolph (00:25:19) : Yeah, retention is very good at Peregrine. Pablo Srugo (00:25:21) : That's probably two sided, one is the types of customers which probably don't, you know, they don't buy and churn technology as fast. But also just if you go through months of integration, that's some cost and the value. Frankly, that you're delivering as a result of that. So both sides of that coin probably put you in a place where you're like, I'm not doing this again in a year, you know. Ben Rudolph (00:25:41) : Exactly and I think it all goes back to this North Star. If a customer is receiving value that is way more than what they are paying for, then you are in good long term shape with that customer and that's the thing that we focus on. Pablo Srugo (00:25:55) : One of the challenges I would say with selling into municipalities, law enforcement, these non. You've got B2B, which is the obvious, the classic, and then you got B2C. And then you got business to something else, government, whatever. These non, it's not consumer where it's, you know, the sort of things they care about, just entertainment and whatever. Ben Rudolph (00:26:12) : Yep. Pablo Srugo (00:26:13) : And then you got businesses, care about making money, ROI, right? And then you got these in the middle where it's, depending on the situation, depending on the politics, depending on whatever. They have different priorities and a lot of times. At least from a startup perspective, it's always a bit of a hard mode situation. Because you're like, it's hard to scale, it's slow, et cetera, et cetera. What do you think has worked in your case? You're deep into it. This is the perspective of somebody that's outside, the thing that gets said, right? You're actually in there. What are some of the pros and cons of selling into these types of buyers? And what helps you crack it in the way that you have, and be able to actually build a scalable business? Ben Rudolph (00:26:50) : Yeah, and I think some of this is very much hard lessons learned over time. The go to market motion for Peregrine was a very hard one. I'd say it was one of the hardest challenges that we had to overcome in the business. We had this phase of the company where I'd say we were in the wilderness trying to find that Product Market Fit. We had that product market fit, we were trying to expand more and then getting that scale. That go to market scale, was really, really hard and that took a lot of learning, and understanding on how government processes work. It took a lot of learning and understanding on building the pipeline. I think there are little tricks in every single state and county that you have to learn. It's hard to enumerate every single one. Pablo Srugo (00:27:34) : What did you learn? Ultimately, what was the go to market that started to actually work for you guys? Ben Rudolph (00:27:38) : Yeah, the go to market that actually started to work for us was one, simplifying down the message we were, what we were trying to sell. I think Peregrine is a complex piece of technology. It could be hard for maybe a person not familiar with technology to explain that value prop. So it was really important for us to make the value prop of Peregrine very clear and have our champions kind of go to bat for us. And the way we got scale is by hiring account executives, you know, across the country and teaching them. And it was card carrying, knocking on doors and doing this at scale and building the pipeline, going through the nine to twelve months sales cycle and doing that enough times over and over and over again. And these things get easier as you do more of it, because as we've generated penetration within certain areas. The next customer is that much easier. That state is more familiar with you, that city is more familiar with you, and so they have a snowball effect, but. Pablo Srugo (00:28:39) : How fast did things ramp? How fast did you get to a million and then $10 million, for example, in ARR? Ben Rudolph (00:28:43) : Yeah, we went basically one, three, ten. Pablo Srugo (00:28:47) : Yeah, I mean that's the kind of classic, used to be the classic, right? Triple, triple, triple, double, double. Now it's one to a hundred in a year. Ben Rudolph (00:28:53) : It took a lot. It took a lot and there was not an easy button question. Pablo Srugo (00:28:57) : Well that was going to be my question, right? It's like, did it ever, easy is the wrong word because nothing's ever easy. You know, even the startups that are high flying, like revenues, it's not easy. I'm sure if you go and talk to somebody at Anthropic, it's not easy. Even though all the revenue is coming in. So easy is the wrong word, but when did it go from a push to a pull? Where did it go from where, at least the growth, the top line, was not the number one, most principal worry? It was other things. And was there ever, like, did that ever kind of start a shift or was it always, okay, how are we going to make it this quarter? How are we going to make it this quarter? Was that just the real life? Ben Rudolph (00:29:27) : Look, I think the reality is Peregrine's goals are always very ambitious, and so it's always top of mind. How do we expand? How do we build? And how do we grow? And what we did last year, by definition, we have to do something new and different. And we have to either build the fleet out more, we have to train the regional sales manager, train the account executives underneath it. Now, I will say we're at a point where we have an engine in the state and local space. It can always be better. We always want to grow faster. We're now expanding to different types of verticals. That takes a whole different type of learning. Our whole idea of Peregrine is deeply understand a vertical, so that you can be successful in it and then when we are expanding to emergency operations or expanding to health and human services. We also have to go and do the hard work of learning that vertical, and learning the way we go to market because it's different. It's very difficult to just kind of copy and paste. Of course, you can take some of those learnings, but you got to do the learning. Pablo Srugo (00:30:22) : But it's always been, the challenge has always been, like you've never been in a position, just to be clear. Where it's like, wow, we have so much pipeline, whether it's outbound or inbound generated. We have so many contracts closing. How are we even going to deliver on this, right? Which is typically the classic quote unquote product market fit that you read about or whatever. That market trees would talk about. Like was that ever the situation, or was it always okay how, okay we're going to triple again therefore, da, da, da and you do. Like most startups that I see, at least, like they live in that. Frankly, whether they say they have problems or not, they live in that world where it's like, OK, shit, how are we going to make this quarter? How are we going to make next quarter? And like, well, if we do this and we do that, maybe we'll make. We're off by twenty percent and then the one in ten are the ones where it's like, yeah, I'm not worried about making the score. I'm worried about maybe retention. I'm worried maybe about like hiring. I'm worried about, raising money cause whatever. I'm worried about all the other things, but not growth. So I'm curious, obviously at the beginning, it's never like that but did that ever happen? Ben Rudolph (00:31:15) : Yes, I specifically remember the next bottleneck for Peregrine was that deployment motion that you talked about, like, how did you scale that? When we started getting, you know, not like single digit customers, but dozens and dozens? And then it was like, oh man, how does this even work at scale? And I think that was a big moment for us. I would say the year of 2023, is. Pablo Srugo (00:31:15) : You're now in the tens of millions, right? At that point, could you point to something? There's probably no good answer to this question. I'll ask it anyways. What took you from more of a push, hey, we're doing numbers, we're doing great, one, three, ten. That's awesome, to like, wow, we're growing so fast. I've got these other problems? And I'm asking it, you know, just for my client. That to me is that, you know, we talked earlier about the product market fit moment. Which is really like a value delivery moment, right? The first time it was an action, you solve the cold case, like, okay, this thing works. That's not necessarily the same as there is so much demand for this. I'm drowning in demand, which is kind of what you're talking about in the 2020s, and I'm curious if that's just a matter of, well, at some point you sell enough. People know you, like you said, commanders, tell the commanders, captains, and word of mouth takes you there, or if something changed, either in a product or the market. That all of a sudden demand just kind of took a step change. Ben Rudolph (00:32:27) : That demand, it's a mix of all of those and the moment that I really felt that we needed to teach it is, we were operating off of a spreadsheet for resourcing and how, who goes where. And, we just had this big list of customers and we had this small list of deployment folks. And they were all tied up in current customers. And we feel very strongly that like, as soon as the contract is signed, we got to start work on this. We got to start integrating data, we got to start providing the value and we were taking engineers off the line and doing core product work to be able to do these far deployed motions. And that is when we were really testing the scale of how we could develop that playbook to make it more efficient. How we could hire rapidly to be able to meet the demand. Pablo Srugo (00:33:10) : And is that also when, just looking at your fundraise history. Would you say that that was also when fundraising really took off? Now you're raising massive rounds and I'm sure it's probably not hard for you to raise. I mean, you want to optimize and all these sort of things but I'm sure you've got more demand than supply in terms of fundraising. And obviously it wasn't the case when you're raising a million dollars. Was this around the time when that changed as well? Is that correlated? Ben Rudolph (00:33:31) : Yeah, absolutely. I think whenever you can show that kind of snowball of growth year over year, month over month, quarter over quarter. At a certain point, the business is starting to be judged on its metrics and when you can show those, that's when it becomes. Pablo Srugo (00:33:47) : Yeah and it's also when you can go to somebody and say, listen, I need money because I got so many deployments coming. I don't have enough engineers to fulfill those deployments. Okay, here you go, how much do you need, right? That is a low risk proposition and that's the beauty of, that's what product market fit does to you if and when you can truly get it. Ben Rudolph (00:34:00) : Yes, yeah, absolutely. Pablo Srugo (00:34:00) : So let's do, we did one of the tackle areas, right? We went on kind of the FTE side and why you did that and how that worked. The other thing that you did that was very different, when we were talking before was the amount of research. You know, people talk about, you know, you're going to do enterprise sales, you have to, you know, research and whatever. But there are gradients into just how far you can take that and, you know, you went to the point where. I think it was for that first deployment. You looked at every single captain across the entire Bay Area. You saw all the records, all the cases they handled. Tell me a little bit about your research driven enterprise sales motion. Ben Rudolph (00:34:42) : Yeah, I think this goes back to our mentality of over investing for success and even when you say that. The moment that comes up for me is it was Christmas 2020, something like that. Where everybody was still home for Christmas and we had this RFP opportunity. And it was one of these situations where it wasn't written for us. We didn't write it and those are always high risk opportunities to begin with. But we read it, we thought it was great. Pablo Srugo (00:35:10) : Yeah, because you assume they wrote it for someone else. So you're already in a backseat. Ben Rudolph (00:35:14) : Exactly, and it was shown to us from somebody who was like, hey, I think this is a good fit for you. But it was working with an agency in the state of California and they had these four scenarios that we had to demonstrate. And this was for emergency operations, and doing wildfire rescue mission. Things like this, and we basically sprinted for three weeks to get our platform to a place where it could show these different demos. One of these demos, Lake Berryessa is a lake up in Northern California that I have memorized by heart. Because one of the demos was to show how you could build a path of travel through Lake Berryessa if these roads were closed off due to wildfire. Very, very detailed and we spent so much time preparing for this RFP, and it was basically a four stage process. We transformed our entire office into an emergency operations center. So when they like called in, we have these cameras that mimic the same emergency operations center that they had in California, and then demoed exactly, you know, all these scenarios. And really went, I would say like a hundred and twenty percent on the effort there. We won that contract, probably shouldn't have won that contract. I'm sure it was written for some other billion dollar company. That has been a lot of our strategy, for. Pablo Srugo (00:36:33) : Now, that's different, to be clear. Than the research piece, but this is kind of the amount of prep that you put into every engagement. Ben Rudolph (00:36:39) : Yeah, it's different in like the tactic, same in the principle of, you know, if we expect to win these kinds of. Especially in areas that were unproven, like the word that I think we always talk about and think about is earn. And we have to earn the right to be able to work with these folks. Pablo Srugo (00:36:57) : So walk me through it, right? Because the whole point of this is somebody needs to be able to copy it, right? So you want to go and you want to win a certain organization. What do you do? What are the sort of things that you're doing to do that a hundred and twenty percent to earn it? What would you do? Imagine me, I'm a founder. I'm like, dude, I think they would be a great customer because X, Y, Z reason. I want to go sell to them. What are the sort of things you would do? Ben Rudolph (00:37:20) : I mean, we've been in a lot of situations where for an organization that we worked for, we did a bunch of research on what their priorities are, listen to their speeches. We would get as close as possible to kind of open source data that they might have. That looks like their data potential we would integrate that, put together a whole demo that solves and speaks to an exact problem. That we know that they have talked about and showing up for a first meeting where you can demo, and speak to somebody about, pretty much their own data and own problems is really powerful. And we use that technique often when we're trying to go work in a place that we don't know as well. Pablo Srugo (00:38:00) : I think the other example that we get to dive into is how you source the first captain that you mentioned. What sort of work did you do at the beginning? Ben Rudolph (00:38:06) : Yeah, and that similar approach was, you know, this is just research work. And we spent, you know, we were in San Francisco. We isolated kind of the cities in the East Bay that we thought were interesting that would probably have a higher level of crime. So we kind of had a whole map of where we thought that the ideal city was, then we decomped who was working at these different police departments. Where were they on the stack, what had they done previously, and so we had profiles of all these different police captains, commanders, lieutenants. And started tailoring very custom, and purposeful messages for each of these folks. And your hit rate's still low, especially when you don't have a product or any, you're just kind of two guys. Pablo Srugo (00:38:52) : But I assume even when you get that first meeting, you already are coming at it with a lot more information. Whether that's building rapport, whether that's going in and, not wasting any time and getting right to the crux of it. Because you know, and then that shows preparation from their side as well. Ben Rudolph (00:39:07) : Yeah, the commander who ultimately said yes, we knew the exact case that he worked on. It was Operation Red Reach, and we knew the details of it. And could talk to him about it, and we're asking questions about that specific case. And I think, you know, if you invert that. That is, you don't often get that feeling when you're talking to somebody for the first time and they're trying to quote unquote pitch you on something. Pablo Srugo (00:39:30) : I think I remember talking to another founder who said one of the challenges when you're doing enterprise sales is you have no credibility. When you are selling into a large enterprise, you're competing with other probably established vendors. Who have a lot of credibility, just because they've been there before. They've sold other products, so they walk in with credibility. You might think the sale is a hundred percent about ROI. That's obviously part of it. But if you have no credibility to deliver that ROI, you're not getting the sale. And things like this are a way for you to show credibility. It's like, okay, you don't have a brand, you don't have a product, but holy shit, you walked in with a lot of research, a lot of preparation. The first impression is, this person's probably credible, probably reliable, and you're still gonna have to, by the way, play the numbers game. Like you said, because most people are gonna say no, no matter what. But it increases the odds just enough that at least one person's gonna be like, you know what, I'm gonna take a bet, I'm gonna risk. Because it's a risk for this person, you know, from their own credibility. Frankly, their own social capital. I'm gonna take a risk on you because you've shown just a little bit of credibility for me to take that next step. Now it's easy. Now you're a paragon. Now you've got funding. You've got all these sort of things. But back then you have to find ways as a founder to show these enterprise guys, especially on the enterprise side, that you have some credibility. Ben Rudolph (00:40:45) : Absolutely, yeah. Credibility, trust, these are big, really important things to land that first deal and I think people don't. Especially if you're coming from tech and you've been an engineer or something like that. When you purchase a big technology purchase for an organization, if you do that well and you do that right. That can move you up the ladder. That is a very important piece of your job and so it is taking a big risk if they go purchase some piece of software that is not useful or helpful. And the reverse is true too. They can climb the ladder based on the smart purchasing and technology they've made. Pablo Srugo (00:41:21) : Perfect, well, Ben, let me stop it there and I'll ask the question we tend to end on. Which is what would be a top piece of advice that you'd give a founder that's also in this kind of early stage, you know, looking for Product Market Fit? Ben Rudolph (00:41:33) : Yeah, I always tell founders kind of the same thing as go sit with your customer. Prove value, that is the thing sand if you're in an apartment or things like that. Get out of that apartment, go to the customer, try and find a situation where you can build alongside the customer. Pablo Srugo (00:41:48) : Perfect, Ben. Thanks so much for jumping on the show, man. It's been great. Ben Rudolph (00:41:48) : All right, Pablo. Thank you. Pablo Srugo (00:41:48) : So picture this, it's months from now, years from now, and one of your founder friends. A really close founder friend of yours, guess what? Their startup went bankrupt, and it turns out if you had just shared the Product Market Fit show with them. They would have learned everything they needed to, to find Product Market Fit and to create a huge success. But instead, their startup has completely failed. You have blood on your hands. Don't let that happen. You don't want to live like that. It is terrible. So do what you need to do. Tell them about the show. Send it to them. Put it on WhatsApp. Put it on Slack. Put it where you need to put it. Just make sure they know about it and they check it out.