Omer (00:09.760)
Welcome to another episode of the SaaS Podcast.
I'm your host Omer Khan and this is a show where I interview proven founders and industry experts who share their stories, strategies and insights to help you build, launch and grow your SaaS business.
In this episode I talked to Itai Sadan, the co founder and CEO of Duda, a professional website builder for Digital Agencies and SaaS companies.
In 2009, Itay and his co founder Aamir were both working at SAP.
They were eager to start their own venture and always on the lookout for a winning business idea.
Noticing that many small businesses struggled with mobile website creation, they dedicated their evenings and weekends to developing a solution.
Eventually they shipped basic software for building mobile websites, but they struggled to find customers because they had full time jobs and not enough time to dedicate to their business.
And getting investors on board was tough too.
Every investor wanted to see more customers and traction and many were skeptical about the business idea.
The first year was full of frustration and doubt which made the founders question if they were even on the right track.
But they kept going, relentlessly improving the product and looking for customers.
Eventually they caught a lucky break when their product caught the attention of someone at ATT who reached out to learn more about what they were building.
Three months later they had signed a significant deal with AT&T.
Today, Duda is an eight figure ARR company used by more than 22,000 agencies to manage over a million websites.
The team has grown to 180 people and and they've raised $96 million in funding.
In this episode you'll learn how the founders overcame significant challenges in the first year where they struggled to acquire customers and heard constant no's from investors.
What the founders did to eventually land a big fish like at&t and how that one customer helped them finally build credibility and validation with investors.
What strategies they used to acquire customers and establish a foothold in the competitive website building industry.
We also talk about how focusing on one specific customer Persona helped the Duda founders to get better traction and align their entire organization and why the founders chose to pivot and rebuild their core product during a very successful time with their mobile website builder and why that decision was crucial to their long term success.
So I hope you enjoy it.
All right.
Itay, welcome to the show.
Itai Sadan (02:54.770)
Hey Omer, thanks for having me on the show.
Excited to be chatting with you.
Omer (02:59.490)
My pleasure.
Do you have a favorite quote?
Something that inspires or motivates you that you can share with us?
Itai Sadan (03:04.210)
Yeah, it's the quote from the Big Lebowski it's the rug.
I had it tied the room together.
And for those who don't know, my company is called Duda, and Duda is named after the dude, which is played by Jeff Bridges in the Big Lebowski.
And I think, you know, the rug in that movie was the centerpiece in in his house.
And it's kind of this triggers the whole story in the movie, but kind of that.
That analogy also relates to a company.
I think every company has a center masterpiece or a center of gravity.
In Duda, the center of gravity is me and my co founder, Amir.
And the foundation for the company is really the relationship between both of us.
Amir is the cto.
I'm the CEO.
He's based in Israel.
Half of the company is there, the other half is partially with me.
And around the world, I see the business side.
I think a lot of the values of the company are predicated on this kind of the relationship between me and him.
I actually know Amir since high school.
So we go, we go.
We've kind of gone through a lot of things together.
We persevered over 13 years of the company challenges, ups and downs.
And yeah, I think that's kind of, if you ask a lot of people in the company, the core is really that kind of the relationship with the two founders, which is an extremely important relationship in any business.
Omer (04:39.560)
I had completely forgotten about the Big Lebowski, and if anybody hasn't seen that, just go on YouTube and look for Pete on the rug or something like that.
I think it's a pretty crazy movie.
So tell us about Duda.
What does the product do, who's it for, and what's the main problem you're helping to solve?
Itai Sadan (04:59.560)
So Duda is the leading web design platform for digital marketing agencies and web designers.
It's basically a website builder for web professionals, people who are building a lot of sites for small businesses, typically tens, hundreds and thousands of sites a year.
It's much more than just a website builder.
It has capabilities that help web designers, digital marketing agencies, collaborate within their teams, manage their clients, build pixel perfect sites, and so on.
We have today 202008 digital marketing agencies.
Using the platform, they've built over a million active paying sites.
Yeah, so we've been doing this for quite a while and continuing to build and grow the company.
Omer (05:51.300)
So give us a sense of the size of the business.
Where are you in terms of revenue, size of team?
Itai Sadan (05:56.980)
It's eight figure.
In terms of revenue, the team is 180 people.
We have about six, seven offices around the World.
Omer (06:07.070)
And I think you've raised around 96 million to date.
Almost 100.
And the funny thing is, we'll talk about this, but when the two of you started out, investors weren't interested at all with what you guys were doing?
Itai Sadan (06:24.910)
Yeah, absolutely, you're correct.
It was tough time back then.
It was 2009, right after the 2008 financial crash and we didn't have a lot of traction to show.
And we'll talk about it probably in a second.
But the initial solution that we came out with is also different than what we have today.
It was a mobile only site builder back then.
That was the idea to take desktop sites and convert them to mobile, which was a solution that small businesses were looking for back then.
And we found a couple of customers.
So Amir and I were both working at SAP at that time and we found our early customers by either knocking on doors on University AV in Palo Alto or putting a little bit of money against ads on Google.
So initially we used our own tool.
We were kind of an agency ourselves and we used our own tool to build sites ourselves for small businesses.
The intent was always at the end to get to a point where it's self service and customers can do it themselves.
But initially we kind of ate our own dog food just to make sure that it actually works.
And, and it did work.
And there was some interest.
The numbers were still relatively small in that.
In kind of the first year, 2009, it was still a side kind of hustle for us.
Our vision was we would leave SAP, we would do it full time, but we really needed investor financing to do it.
We both had families, we couldn't just drop everything and just start a business.
And I think the initial numbers were, when we were talking to investors, there were a lot of questions of how big can this be?
And so forth.
So we tackled that for, for the first year there was a, you know, there were tough, there were definitely tough days in that first year where we were even questioning ourselves, are we building the right thing?
You know, Will this, is this a real business?
Omer (08:33.080)
So, so that first year 2009, this is a kind of a side hustle for the two of you while you're working full time at SAP.
How easy or hard was it to get conversations with investors?
Because you're very, very early on with starting this company.
And how many investors did you reach out to?
How many conversations were you able to have?
Itai Sadan (09:00.670)
We were in the Silicon Valley, so I don't think it was really that hard to get initial meetings.
It was really Difficult to get.
The second meeting after the first, we just heard a lot of no's, no interest.
You know, this is, was before there was other site builders that in the space that went public.
So there was no big company in the space, you know, Wix or Squarespace, all those were not big yet.
So folks were doubting how big this can get and we were really focused on mobile side.
So it was the early days of mobile.
You know, the first version of the iPhone just came out kind of in 2008.
So is this really going to be enough of platform to build a business around?
So there was a lot, a lot of questions about how big this can get.
Omer (09:48.090)
Correct.
And from what I understand, it wasn't like what it is today, a responsive website builder.
You were helping companies to basically build a mobile version of their website alongside their main site, is that right?
Itai Sadan (10:06.490)
Yes, exactly.
Basically it was a very simple solution and that was a little bit of the beauty behind it.
All you have to do is put in the URL of your desktop site, you click submit and we kind of take it and reformat it for a mobile screen.
So a lot of the pain back then was that even the best sites on the Internet, once you looked at them on an iPhone or an Android, you really had to pinch and zoom through that website.
And we kind of solved for that by creating a really great experience.
It was almost magical and folks could continue and edit it.
It essentially created the M dot version of the site.
But that was also, you know, now I'm jumping ahead, you know, two or three years later.
Initially, a lot of companies were adding this wanted like an M dot version of their website to address mobile traffic.
But a couple of years later, with the proliferation of devices and screens, people didn't want to build a site for mobile, a site for desktop, a site for tablet.
They just wanted build it once and it runs on all devices.
And that was kind of the next challenge that we had to face down the road.
But maybe I'm jumping a little bit ahead because that was like two, three years later in 2012 kind of.
Omer (11:21.290)
Yeah, we'll definitely come to that.
I just have a couple more questions about that first year or two.
The first year, as you said, was pretty tough in terms of investors don't seem interested.
You did get a little bit of traction.
You've got the product out there, you've signed up some customers, so you have some early promising results, let's say that.
But I know from these constant nos that you were getting, at some point you two started to doubt yourselves as well, whether this was the right thing or whether you were going in the right direction.
And then at some point you had a lucky break.
Can you talk about that?
Itai Sadan (12:05.220)
So this happened in 2010.
So we're operating more or less a year as a side hustle, side project, nights and weekends, getting a couple of customers.
Again, a lot of no's.
And then at some point AT and T heard about what we were doing and they got interested.
And those discussions moved very quickly.
And in about three months, I would say from the first discussions with them, we were with the deal signed and they were ready to go live with our product.
They basically white labeled our product, put it under the AT&T brand.
Back then it was a.
It was called AT&T Interactive.
It was a sub company inside AT&T.
And they were offering it to their small business customer.
And this was really what triggered investors started to get interested as there was a proof of a big brand that was interested in the product.
And so more or less alongside.
In those three months while we were kind of launching with AT&T, we got our first seed round, which also helped us kind of leave SAP and dedicate our kind of full attention and time to this company.
Omer (13:32.660)
So do you know how AT&T found you guys?
Itai Sadan (13:35.220)
They found us through actually a relative of mine who met one of the executives in AT&T Interactive in a conference.
So just by chance that relative of mine knew enough because I demoed to him what we were doing.
So he got, he just got enough of.
He was able to explain what we were doing so that the.
Enough for them to be interested and reach out to get more information.
I think you can't.
It feels, it feels very, very lucky.
And I'm sure luck is always a big component of everything, but.
And I hear a lot of, you know, I talk to a lot of entrepreneurs and that same challenge that we have, everybody's kind of, yeah, invest are not interested.
They want to see traction, but they're not willing to invest in me.
So I can do marketing, so I can really get traction.
So it's kind of always a chicken and egg, but you just have to crank through it.
I think that's the.
You have to crank through it until you get that break.
Either, you know, you continue to evolve the product in the very little resources that you have because you believe in it, you continue to get more customers.
And either if you're kind of in the SMB space, you have to.
When investors want traction, they want to see enough small business customers, enough Volume to show that this is a credibly growing business and can continue to grow.
Or if you're more kind of in the enterprise, mid market, enterprise space, you need to land that, that big, that big fish without having a lot of investment in your company just based on a big customer having a need and seeing you with your solution, solving that pain.
So once you get that, and I think in today's world you should be able to get that with relatively little investment for many software businesses, at least then I think the rest of the things will follow.
Omer (15:32.060)
Do you remember roughly how much the AT&T deal was worth at the time?
Itai Sadan (15:36.700)
I have a picture until this day with kind of the check once it arrived home and I'm kind of holding it outside of outside the door next to the post box.
I don't remember exactly how much it was.
I'm sure it was in the kind of tens of thousands in monthly revenue in the first couple of months and then probably grew beyond that.
Omer (16:01.650)
And it gave you enough in terms of revenue and I guess confidence for the two of you to say, okay, this is the time for us to quit our jobs.
Go full time, go all in.
Itai Sadan (16:14.460)
That and mainly getting the investors interested.
So after hearing a lot of no's, suddenly we had two term sheets.
And actually the person who invested, his name is Oren Zev.
He's our seed investor.
Amazing investor until today.
Thirteen years later, we're very close and he's still on the board and very involved.
He always says that he invested because he believed in the business.
Despite that, the vision was not servicing big customers like AT&T.
But probably if we didn't have AT&T, he wouldn't have invested.
So it was important to get a proof that there's a customer out there, a big customer that sees value in your product.
But he believed in this kind of longer vision out there where we would open this as a self service product and get lots of customers.
Omer (17:14.150)
Great.
Okay, so the two of you are now working full time on the business and I guess a year or Two later, or two years later, around 2012, you hit another roadblock, which is I guess when you start to question whether having a mobile only site was the right solution, the right kind of business model for your company.
What was happening externally that drove you guys to kind of look at what you were doing?
Because in some sense you could say, well, great.
It's like we finally, you know, for a year we weren't getting anywhere.
We've got a big customer signed up, investors are willing to invest Money.
What changed that got you guys kind of rethinking the game plan?
Itai Sadan (18:09.060)
Yeah, it's a great question and it was difficult to really identify.
Right.
It's kind of, there's a market dynamic that is changing, but it's not that one day kind of it's not as clear.
It's not like that.
You get to a point where it's a cliff and the business is falling off the tracks.
Now the business was doing really well in 2012, just raised our B round from VCs.
The business was growing at a spectacular pace.
We had hundreds of thousands of mobile sites on the platform by then.
We were growing really fast.
But they were starting to be signs out there that there's some danger down the road.
It's not that the business was falling off a cliff and we needed to make a decision.
Not at all.
It was hard to spot this but, but there were, there were certain signs of risks.
Responsive design started to garner attention.
Right?
We were a mobile only solution.
Responsive design was kind of a paradigm where you can build it once and it runs on all devices.
And we were starting to hear a lot of questions, maybe a lot is exaggerating, but we were with some of our partners, questions about is this responsive?
Is this adaptive?
What is this mobile type of site, Is this the future?
So we started sensing these questions and we had good answers for them.
And the challenging thing is, as I said, we were growing.
We're getting, you know, revenue was growing and to pivot into kind of something to do something else was, you know, was, was a big, a big risk at that point.
And I can understand how, you know, you look at the history, how so so many great companies, if you take kind of the Kodaks and the Blackberries, the Blockbusters, I'm sure the smartest people in the room were in these companies and they might have seen like what is coming down the road.
But when you have a business that is, you know, when you have sales teams and so many people incentivized on, you know, bringing in revenue from a very certain source, it's really hard to come and say, hey guys, let's stop doing what's kind of this entire revenue that is paying everybody's salaries around here and let's go do something else, right.
It's a very difficult thing to do and kind of move that ship, you know, unless you really have to.
And, and I think, you know, we, I mean it's, it's more at the, you know, startup phase.
I feel it's really the responsibility of the founders to look ahead and navigate that chip and make sure that the company always maintains product market fit and if the market adjusts or moves, you have to adapt the product in order to make sure that you sustain the business.
In kind of the end of 2012, we started like we first persuaded ourselves as the two founders that we needed to kind of build something that would be a responsive design solution.
We were also thinking about other options.
We could have gone into others because the company was really rooted in mobile.
We were even called Duda Mobile back then.
So it was really hard to come and tell everybody, hey, we're called Duda Mobile and we're all, all, everything we do is around mobile, but let's go do this other thing that is not mobile.
So we also thought about should we go into mobile advertising, should we do other things?
Because obviously mobile was big and there might have been other opportunities there as well.
But we decided that we felt that there's a big opportunity around responsive web design and we wanted to come out with the first solution to the market that would be a simple website builder based on responsive web design.
We felt that there's an opportunity there and we started, we first persuaded the management team and then kind of talked to the company about it and we got people bought into it and kind of end of 2012 we started building kind of our second product, which is our core product today, and called Duda.
Omer (22:40.950)
And then presumably you had to persuade the, or at least get the investors on board as well after having raised a series B on a different idea to then say, guys, we're actually now going to go and invest and take this in a different direction.
I think one thing I want to try to understand is we're talking 2012, what did the landscape look like at the time?
Because when you're building a mobile website builder, it's a very clear value prop.
I don't know how many other solutions were around at the time, but when you then say we're a website builder and yeah, we're responsive, but we're your one stop shop for building your website, you're now kind of getting into the space with WordPress and I don't know what was happening with Squarespace and wix at the time, but I assume they had a decent presence by then, right?
Itai Sadan (23:38.120)
Yeah, they had a decent, they, they were known, they were not, I don't believe they were public at that point, but they were, they had a really nice growing user base there and you know, we thought we could beat them.
We.
It's kind of we were mobile and we were adding kind of the other screens and they were going the other way from being desktop first, adding kind of mobile.
So it was kind of a race.
It took us much longer than we thought until we launched with the product.
We were not the first responsive website builder out there, although that's what we hoped we would be.
And then kind of by the time we eventually launched that product in 2014, it took much longer to build than we thought.
It was tough because there were other solutions.
And suddenly kind of maybe for the first time in kind of three, four years of the company, the word differentiation came into the jargon.
Like how are we different?
You know, why are customers going to come to us and not to them?
So we were thinking we were looking at our user base and about 50% were small businesses building websites for themselves.
And the other 50% were these web pros, web designers, digital marketing agencies, marketers building websites for others.
The company was torn between these two types of customers because each one was asking for different things.
The SMBs were asking build me these simple tools so I can just click, click, click and launch my website very quickly.
While the web designers were asking for sophisticated tools, powerful tools.
So we understood that we needed to make a decision between these two customers that were kind of tearing the company apart.
We were significantly under resourced compared to the giants in the space and there's no way that we can address these two customers successfully.
So we looked at the data and we felt based on the data that these agencies, web pros were growing faster than our small business customers.
We also felt we understood them better.
Maybe it's the Israeli engineering DNA.
I think we're good at building sophisticated technology.
We maybe weren't as good or as excited about kind of dumbing down the platform for a very non technical simple user.
And then third, we felt that there was a really big opportunity just around the web pro market.
We felt these customers were underserved with existing solutions and we thought that by doubling down we could really hone the platform to address their pain points and kind of have a differentiated messaging to the market that we are a platform for web pros.
So I'd say kind of from 2015 we made that decision that we're going to be a web pro first company.
And from that day onwards until today, we don't spend a dollar to acquire a small business.
Omer (27:05.160)
So I think that all makes sense.
And definitely we can look back now and say it was probably the right decision for you to do that for someone who's listening to this might be thinking, well, what forced you to make that decision?
The company is growing, it's growing.
Well, you mentioned you'd raised the Series B.
You've got these two customers and at least up until that point you had been able to serve both their needs and the business was growing.
I think you alluded to it a little bit when you said having these two customers was tearing our company apart.
Can you just help us understand what were some of the struggles that were getting caused by having these two groups versus just saying, well, yeah, we could make this decision, but we could probably also go another four or five years by still kind of trying to walk the line and keep growing both these customer bases.
Itai Sadan (28:06.270)
So I think in the early years when we were only a mobile solution, you'd ask me, who's your customer?
I'd say, whoever wants to use the product.
There was, there was really.
We were not.
There was no discussion about differentiation.
We were growing gangbusters.
And I think at that point it's just a land grab.
And if you're in that position, I think that's a very great place to be in, to be a leader.
And that when there's so much market demand, you don't need to think too much about differentiation.
You just continue building and growing your user base.
Two, three years in, that trajectory changed.
We, as I mentioned, due to mobile, like mobile was starting to decline.
We launched the responsive website builder.
It was growing and it was growing in nice percentages, but it's a subscription business.
It started from zero.
So it was, you know, small numbers in terms of revenue.
Now you're making millions on a product that is declining and you have a product that you just launched that is getting nice traction, but, you know, still low numbers.
It's a very tough.
Now you're.
And you also have investors now on board.
Think of the top line in this company.
We had about two years there, I'd say kind of 214 to 16, where revenue was just flat.
Right.
This mobile product that had a lot of revenue was financing the growth of a product that was still very early.
So it was like we're taking dollars out of one pocket and putting it in the other pocket.
And I think the newer product, it was growing, but not growing at the same levels that the heydays of mobile.
And there was a lot of competition, as I mentioned, from the Squarespaces, the Wixes, the WordPress.
So we knew we couldn't raise more money.
Like when the top line revenue of a company is flat we were supported in those two years by our existing investors, which were great.
These were also tough conversations with the existing investors.
We were not profitable.
We were far from being profitable.
We needed them to continue and support the company, A company that they knew that no external investor is going to put more money into.
But proving through the numbers that there was something there, something growing, it at least helped us get them to continue to support us.
And I think going back to your original question, through all these conversations and the challenges with growth and part of the business declining, part of it is growing.
There's also that differentiation question and this new platform, why is it going to be better than these other platforms in the market?
What's our differentiation and so forth.
So that kind of really forced us to.
Also from an efficiency perspective, when you're supporting two platforms and all customer types, like how are you really going to compete with these giants?
You know, when your R and D needs, you know, when you have an R and D that is maybe the 10th of a size of your competitors and they're focusing on less customer types than you are, so you're forced to make kind of a decision if you don't want to hit a wall.
Omer (31:33.510)
So you basically said, we're going to go all in with pros, we're not going to try and build this product for SMBs.
How did that look in terms of execution?
Was it like, I mean, obviously like did you just let these SMBs continue using the product and then, you know, if they, they churned, they churned.
But everything you were doing beyond, you know, beyond that point in terms of go to market any ad dollars you were spending where your sales folks were focused, it was more all about going after pros now.
Itai Sadan (32:08.640)
Yeah, very much the latter.
We didn't fire any customer, so we were in a fortunate position where it didn't require a lot of investment to retain the SMB type of customers.
And until today actually if you're an SMB, you can go to our website, Duda Co and sign up for a website and we probably still have a lot of SMBs.
Although the messaging on our website is very clearly geared towards agencies and web professionals.
But some small businesses are more technically inclined and maybe want a more sophisticated product and find it within our solution.
So yeah, so every like maintaining that customer base, it was important that was generating a lot of revenue, but really kind of starting to transition the company in terms of from a marketing perspective, the level of messaging, if previously we needed to, you know, when it was, it was, there was always conversations Arguments in marketing, do we say responsive web design or maybe SMBs don't understand that and we should say we works on tablet, desktop and mobile.
Right.
So these conversations went away the moment that we decided no, we are a web pro company.
Marketing team knew at what level to message.
The R and D team knew which features to prioritize.
The sales team understood who their customer was.
It brought tremendous amount of clarity and focus into the organization.
Just that what seems like maybe simple decision.
It had a lot to do with focus and really help kind of propel the company to where it is today.
Omer (33:43.360)
Great.
So I want to talk about growth and some of the strategies that helped you grow the business as well as some that didn't work out well.
Before we do that, one of the things that we didn't talk about was the Google deal or partnership which, which happened I think around 2012.
So can you, can you explain like what was that, what was that deal, what did it look like and how did it come about?
Itai Sadan (34:15.450)
So this was still on the, you know, mobile days when we were still due to mobile and conversations with Google got to a place where they wanted to offer our mobile product to their customers under their own brand.
And Google very seldomly does that where they will take a small startup's software, put their own brand on it.
It was like Google Mobile website builder powered by Duda.
So it was co branded and they emailed their Google Adsense, Google Adwords, Google Analytics customers telling them you should really mobilize your website with the software.
Because their intent, they were actually losing advertising dollars because desktop sites were not driving the engagement on mobile and they wanted a lot of their customers to move to mobile to drive more advertising sales.
So that partnership was extremely beneficial for us.
I think until today a lot of people when I say Duda, they say Duda Mobile.
Even though this was a product from, you know, 10 years ago, it's just being associated to the Google brand and the power of marketing that they have when they do something at this scale.
And we were working with so many teams inside Google in different countries, different locations to make sure, you know, we were localizing this product for different markets for the Spanish market, obviously for the English market, for the Japanese market, we can talk about that as well.
So that I really feel gave us a huge boost.
And by the way, some of the challenges that I talked the flags down the road in that relationship with Google around where we started to sense that mobile might be a problem is some pushback that came from.
Again this was maybe a year in or a year and a half into that relationship with Google and that partnership with working well.
But some of their engineers started pushing back on, you know, like due to mobile.
We don't see it as the future solution.
The future is really responsive.
So these are some of the things where we picked up where some of our partnerships were also having this debate internally if this is the right solution or not for the future.
Omer (36:41.540)
How did that deal come about?
How did you get talking to the folks at Google?
Itai Sadan (36:45.540)
Oh yeah, I don't remember exactly how that one came about.
Omer (36:51.420)
I mean it is really unusual for Google to want to take a product from a startup and white label that for their customers.
I mean I spent a long time at Microsoft and although we didn't explicitly say it, we always had this culture
Itai Sadan (37:08.380)
of
Omer (37:10.780)
if something was not built in Redmond, you kind of were like, I don't know about this.
Right.
So it was always about, you know, we build.
It's not really a buy decision unless you're acquiring a company or something like that.
Right.
So yeah, it was a very, very unusual thing.
So I was just curious like, you know, why, why it happened and I think you've explained that a little bit.
But it sounds like, you know, like how did that sort of deal, how long did it last?
Like a couple of years?
Itai Sadan (37:41.070)
No, it was about, I would say it was about a year, a year or maybe a little bit longer.
And it was a unique deal where we actually gave all Google customers the mobile site for free for a year.
And the deal was whoever we managed to retain after a year, that's like 100% our revenue.
So they get it free for a year.
And really the game is what kind of conversion there will be in the second year thereafter.
Google wasn't interest.
They didn't care that much about the revenue from the site so they let us keep 100% of it after the first year.
They just wanted us to be able to give that for free for a full year to their customers.
Which I think was very beneficial for both sides.
Omer (38:25.850)
Yeah, yeah.
So let's, let's talk about growth and you know, some of the main channels that have worked for you in the, in this sort of early years.
What drove the majority of the growth?
Like how were you acquiring customers?
Itai Sadan (38:47.280)
So we used all channels, all common channels between, you know, search, organic, paid to grow our acquisition.
We always had a, it's a very self service, product led growth type of model where people come to the website, try out the product.
There were initially maybe it was free for a Certain period we later then changed to more like a free trial type of paradigm.
And that engine of, you know, a freemium until today has kind of been at the core of what we try to do, drive people to start a free trial of the product.
So when you can do that with software and give it for free for a certain period of time, I think this is a key to kind of the success and getting kind of a really large top of funnel and eventually optimizing that to conversion.
Omer (39:54.340)
So initially you're driving sort of this product led growth and then you started to see this opportunity for a reseller program.
Itai Sadan (40:04.800)
Right.
And so the reseller program is, you know, initially it was, you know, like many maybe companies have on their website, somewhere on the navigation you have something that says partners or resellers.
And that's how it started with folks asking.
We gave some additional features in that program, like you could actually white label our own product.
So display it, you know, you could display it to your customers under your own brand and you would have to pay extra for that.
It was also a way like we looked at, you know, inside the funnel that we had and tried to identify folks who could be interested in that program and kind of funnel them to talk to salespeople.
You know, that's the only area where we had salespeople.
So it's either you did self service and used it, or if you wanted to talk to us about the reseller program.
And that reseller program started growing, we hired more people, it became more established, more successful, started generating more material revenue to a certain point where and it kind of started taking more real estate on the website where we kind of figured out this should actually, this is the product.
So let's make sure that it's not just a product where there's a reseller program, but the actual product.
With the transition that I talked about previously, where we wanted to focus to web pros, let's put this front and center that this product, once you get it, it's not just a website builder, but it's a website builder that you can white label and has features that are relevant for agencies, web designers, people who are building sites for others.
And eventually it's the whole website and the focus of the product.
Omer (42:00.060)
And so this became like your primary growth channel for the business until you sort of made this shift to selling more to agencies.
Like how long was the reseller program something that continued to dominate sort of growth and you know, or until you had to start thinking about agencies or alternative channels.
Itai Sadan (42:26.880)
So not what we Call like our agencies are the resellers, right?
That's, they are the channel into the SMB market.
So kind of at that point in 2015 when we decided no, we're going to be a web pro only type of company, that's kind of when we fully transitioned where that program of web pros was basically the only program and the price and the plans that we had on our website were only plans for people who are going to resell.
So build websites and resell the website.
Omer (43:05.740)
Okay, okay, got it.
That makes sense.
One of the other things that you guys tried to as a growth strategy was international expansion.
And one of the places you, you tried to, to get into was, was Japan.
And I don't know how much of an investment you made in there, but ultimately that turned out to be a lot more difficult than, than you had had imagined.
Tell us a little bit about that.
Like how did, how did that come about?
Why did you pick Japan?
What kind of investment were you guys, you know, or did you, did you make to try and break into that market?
Itai Sadan (43:43.640)
So we, we were predominantly, I would say early days, North America type of solution.
Some, some level of penetration in emea, but no, no feet on the ground in emea, so doing relatively little there.
But anybody from, you know, anybody from around the world could use us.
And through this relationship with Google, Google, Japan became really interested in our product and invited us over.
We did a kind of one week trip there, me and my chief revenue officer and we said, okay, if we're heading to Japan, all the way there and we were trying to support Google with whatever they wanted, right?
They were the key flagship partner.
Whatever you want, we're here to deliver.
Because it was a very, it was a great partnership.
And so we set a couple of other meetings while we were there in Japan and we hired a firm that was, knew how to insert or help startups penetrate the Japanese market.
And they set a couple of meetings for us and we came out of a week there with about seven partnerships.
Big companies that wanted, you know, big Japanese conglomerates that wanted our solution.
So you have kind of, you know, everything that you need.
You know, super successful week.
You know, we're going into Japan.
We understood that there's a cultural language barrier.
You know, people tell us, you know, you can't succeed without a GM there.
So we hire a GM there.
That GM obviously can't do everything himself.
They need like a support person, needs an account manager.
Very quickly you find you have like three, four people there and then kind of you look A year, two years down the road from that decision, there was not much revenue to account for that, even though we had these five or seven partnerships.
So there was a dichotomy between the potential that we thought that was and what the actuals, what, what revenue we were seeing from that region.
And eventually after two years, we actually decided to shut down that office.
So it was a very big jump for a company like ours to go into a market that is so different from a cultural perspective, from a language perspective.
It was even hard for us to understand what were exactly the challenges of why these partners in Japan were not selling well.
You know, we had to rely on translators.
Our team there, we were hearing kind of different stories.
You know, the Japanese culture, you know, nobody wants to kind of insult you and tell you maybe the exact reason, so you're hearing different things.
So we, until today, I can't tell you that I exactly understand why we didn't succeed there.
We tried different things and it just didn't work out.
And we decided that, you know, maybe we kind of jumped a little bit, you know, over our skis there and we needed to go back to focus on the key geographies that are working.
And it's probably makes more sense for a startup that has been doing, you know, kind of well in the, in North America to consider first of all, other English speaking countries that like, you know, Canada, Australia, South Africa, obviously uk, you know, expanding there, expanding to other countries in Europe, things that are, you know, not as big of a leap as going into to Asia.
That requires much more scale and much more resources in a company to maybe do it successfully.
Omer (47:32.060)
So I think we should wrap up, we should get on to The Lightning Round 7 Quick Fire Questions for you.
Just try to answer them as quickly as you can.
Are you ready?
Itai Sadan (47:41.420)
Absolutely.
Let's go.
Omer (47:43.070)
Okay.
What's one of the best pieces of business advice you've received?
Itai Sadan (47:46.830)
I've received a lot of business advice.
I think there isn't one single thing that I would call out.
I also received a lot of advice that wasn't that great.
I think at any stage of your company you should listen to different people and make up your own mind.
Omer (48:01.630)
What book would you recommend to our audience and why?
Itai Sadan (48:04.350)
It's the Hard Things about Hard Things by Ben Horwitz from Andreessen Horwitz.
It's just a great business book.
He talks about his own professional journey and he shares a lot of the things that he screwed up along the way.
A lot of great learnings from that book.
Omer (48:23.000)
What's one attribute or characteristic in your
Itai Sadan (48:25.920)
mind of a successful founder to be level headed.
At least that works for me.
I think there's so many ups and downs on this journey of building and scaling a company.
There's good times, there's bad times.
You need to keep level headed.
Omer (48:44.250)
What's your favorite personal productivity tool or habit?
Itai Sadan (48:47.690)
I personally use Asana as kind of my to do list.
This is where I store all kind of the major tasks I need to do.
I prioritize them.
And for me, aside from that being kind of the storage place for all the things I need to do, it's also a peace of mind that I know I don't need to keep on thinking about.
I need to do this.
It's there.
And this is kind of how I decide what are the things that I'm going to be doing in the next day or week?
Omer (49:22.270)
What's a new or crazy business idea you'd love to pursue if you had the time?
Itai Sadan (49:26.270)
I have a lot of great ideas, but I'll keep them to myself until I have time.
Omer (49:31.780)
Okay, what's an interesting or fun fact about you that most people don't know?
Itai Sadan (49:35.780)
I have four different citizenships from four different countries, each one in a different continent.
So it's Israeli American, South African and Polish.
And maybe that's kind of something we can talk about in the next podcast.
Omer (49:54.900)
Yeah, that's a separate episode.
Just how you got those four.
And finally, what's one of your most important passions outside of your work?
Itai Sadan (50:01.980)
I love sports, any sports, but especially running, biking, surfing.
Omer (50:08.940)
Great.
Well, it'sai thank you so much for joining me.
It's been a pleasure chatting.
I love the story of what you guys have gone through to build Duda and get it to where it is today.
I think that there might be people out there listening who are in that first year back.
This year is their 2009 and they're struggling to get their idea off the ground.
And maybe your story will provide some inspiration.
And then beyond that, yeah, you had some lucky breaks like the AT&T deal, but there was also a lot of challenging times that you had to figure out how to deal with and overcome and some decisions that you have to make, which is not always easy when you're basically, you're basically sacrificing your cow right the side of the business that's bringing in all the revenue.
So it was really helpful just to understand the decision making process and how you went through that and made those calls because I'm not sure we did it justice.
But when you're in the trenches in the middle of that, it's a really tough situation to be and it's not always as clear as it might be now.
When you look back in five, six years time and say, yeah, that was the right call.
So appreciate you doing that.
If people want to check out Duda, they can go to Duda Co. And if folks want to get in touch with you, what's the best way for them to do that?
Itai Sadan (51:38.360)
I'm on LinkedIn, Twitter, any of those, or feel free to email me at itaitai Duda Co.
Omer (51:48.970)
Awesome.
Thanks man.
Appreciate you making the time and I wish you and the team the best of success.
Itai Sadan (51:54.730)
Awesome.
Was a lot of fun talking to you.
Omer.
Omer (51:57.690)
Cheers.
