Renewtrak: From Struggling SaaS Startup to 29x ARR Growth – with Mathew Cagney [345]

This is a machine-generated transcript.

OMER
Welcome to another episode of The SaaS Podcast. I'm your host, Omer Khan, and this is the 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 took to Mathew Cagney, the CEO of Renewtrak, a platform that manages the renewal process for global tech companies like VMware and Lenovo. Mathew became CEO of Renewtrak in 2020, taking over a startup that had been founded six years earlier in 2014, but had failed to get any real traction. The original founders had built a beta solution, secured initial funding, and managed to get two small customers. But things had pretty much stalled there. Although Mathew isn't technically one of the founders, he still had to think and act like one and figure out how to find product market fit and do it fast. When he joined the company, he had a high churn rate, no new customers coming in, and was quickly burning through the money that it had raised. So,, it was a tough situation. In fact, Mathew told me that the first two years at Renewtrak were probably the most difficult and stressful years of his career. But things eventually paid off, and today, Renewtrak is doing around $6 million in ARR. In this episode, you'll learn what Mathew did to Revamp, a product that had multiple code bases, scaling issues, and a lot of complexity in onboarding new customers. How Mathew and his team over-invested in customer service while the engineering team worked for a year to resolve the product issues, the pricing challenges the company faced, which almost put it out of business, and what Mathew did to fix that situation. And we talk about how Mathew decided that he couldn't ask his sales team to close more deals until he personally could go out and sell the product. So,, I hope you enjoy it. All right, Matt, welcome to the show.

MATHEW
Great to be here.

OMER
Do you have a favorite quote, something that inspires or motivates you, that you can share with us?

MATHEW
I think my favorite quote is “Time kills all deals” or the other favorite quote, in a similar vein, is actually, “The selling only starts when the customer says no”.

OMER
Love it. So, tell us about Renewtrak. What does the product do, who's it for, and what's the main problem you're helping to solve?

MATHEW
Essentially, the contract renewals process for tech vendors around software support and subscriptions is broken, completely broken between the tech companies, their customers, and their sales channels. Essentially, what this means is it's fragmented, heavily dependent on humans, heavily dependent on spreadsheets, heavily dependent on email. And what that means is it results in unnotified customers, unnotified channel partners, which essentially results, in the end, customer actually losing out on that product or service or from a CFO's point of view, increased customer churn and very, very low net revenue retention or net dollar retention levels.

OMER
Can you give us examples of some of your customers today?

MATHEW
Yeah, some of the better-known ones are companies like VMware, the big virtual software provider. Lenovo, the largest PC manufacturer in the world, HP, Cisco, down to some smaller data companies like Precisely.

OMER
And can you give us a sense of the size of the business? Where are you in terms of revenue, number of customers, size of team?

MATHEW
We are at 34 staff globally. We're just about to hit 6 million ARR, and our customer numbers would be about 16 to 18.

OMER
That's a nice chunk of revenue from a fairly small set of customers.

MATHEW
Yeah, look, it is. And if you're talking to the VC community around the world, they might say your customer concentration is too high, or a new track continue to build out your growth engine and your customer onboarding, reduce your CAC Twelve and improve your CAC LTV ratio. But we've got some really awesome long-term customers that we're continuing to grow and expand rapidly with. So,, one of the things I measure our success on is actually just customer growth and expansion.

OMER
Let's talk about what you were doing before you joined Renew Track. What's your background and what were you working on?

MATHEW
Yeah, look, I come from essentially a sales, marketing, and product background, strong, kind of entrepreneurial background. I developed the first KYC AML CTF compliant electronic identity verification platform in Australia. Then I developed a number of mobile banking apps, personal financial management solutions. So,me of your listeners might recognize them as a competitor to Yogley. We managed to help keep Yogle at bay here in the Australian market with our own developed personal financial management platform. Prior to Renewtrak, I was at a buy now, pay later company called Afterpay, actually. And one of the things you pointed out when we're prepping for this podcast is they were founded the same year as Renewtrak.

OMER
Yeah, with very different trajectories, and we'll kind of compare those as we go along. But Afterpay only 2014, I think the company raised just shy of $450,000,000 and then was acquired by Square in the latter half of, I think, 2021 for what, $29 billion.

MATHEW
Yes. Absolute amazing story. I was there from some of the early days. Afterpay was founded by Nick and Anthony. They had an amazing idea, but they weren't sure how to build the tech and products, and they knocked in the door of a company called Touch-Corp. I essentially was within the Touch-corp team. And what Touch-corp had developed was a product and software technology that actually allowed them to make a real-time assessment of a customer and whether they were prepared to take the credit risk on that customer in an online environment without a credit check. So, really looking at digital fingerprints, the merging of those digital fingerprints and PCI-compliant credit data and quite an interesting library of data in the background, which enabled them to take on that risk on behalf of large telecommunication companies. And that was really the foundation tech stack for Afterpay and allowing them to take the risk of four new customers that they'd never seen before.

OMER
So, Renewtrak, you joined in 2020, I think as the CEO. The company had actually been founded almost six years earlier in 2014, same time as Afterpay. Tell us a little bit about what was going on with the business when you joined because the majority of my conversations about founder stories and you were a founder of Renewtrak, but as we looked into this and we talked about your journey and your experience, it's very much like founding a business. And so, if you can help us sort of set the background on what happened in those first five or six years before you joined and what was the situation like when you came on board as CEO?

MATHEW
One of the things during those first couple of years of the organization, the original founders developed an amazing concept, was brilliant and it addressed that fundamental renewals problem which was completely and utterly broken. Amazing concept, amazing sales guys very early on and they managed to convince a number of angel investors to support their particular vision and pursue to solving this problem. And what they did is they actually repurposed an existing technology tech stack. So,, you imagine collection software, which is a workflow and a series of routines that communicates with a customer who's not paying you. They turn that software around to actually communicate proactively to the end customer about an upcoming contract inquiry about, hey, let me remind you let's make sure we give you plenty of advanced notice and let's actually give you an e-commerce checkout so you can commit and pay to that renewal. So, they repurposed that amazing concept, got them to market very very quickly and since they were such good salespeople, they managed to get too early customers on the hook and start proving that. I think that's where it started to get really complex though.

A lot of technology vendors are constrained by their own data and the reason they're constrained by their own data is a lot of them to scale, actually engage third-party channels. And when they do that, that third-party channel starts to obfuscate. Who is the end customer, how do we get them? Product and pricing is slightly obfuscated and so we have to solve the data issues between the tech vendor, their sales channel and the third-party sales channel and their customer about how do we communicate with that customer on time, regularly and proactively. Now that's easier said than done, especially when you consider just the general data hygiene practices and how old that data might be with that vendor. I think that's probably where we started to come unstuck. And what that meant is we had to create individual products for each one of these customers. Which really meant when I joined, we had six core individual products and individual lines of code.

So, it was like managing six individual products. It was just too hard. And the team was spending a lot of money just supporting the BAU process. But what I personally loved about the business is it was solving a problem that I'd experience an Afterpay when we hadn't been notified about a renewal and the vendor shuts off our platform. And I get woken up in 03:00 AM on a Sunday morning and our customers are screaming at me saying, hey, we can't transact what's happening. And we set about our dev team to investigate what happens. 4 hours later, we find that actually the vendors shut down this key piece of software to run our tool. That frustrated me enough to actually invest my own money in the company behind the idea and concept. And that's how I got involved.

OMER
So, you mentioned six variations of the product, but if there were only two customers at the time, why six flavors of the product?

MATHEW
Well, yeah, we had probably another four POVs going on in parallel. If you break that down, maybe one of the customers had four different vendors under them. So, it was a separate product for each one of those to ingest their data. So, we had an early customer called Ingram Micro and we had enabled four of their individual vendors on our platform, but their data ingestion process was broken. Just created too much overhead for us to manage as a company. The way I look at it is, how much of our development team capacity are we spending on, putting out fires or developing new features that we can actually monetize? When I got in and I did an assessment, we were spending 95% of our time on purely putting out fires. You can't run a high-growth startup when you're spending 95% of my dev effort looking backwards.

OMER
I want to dig into what you did to try and turn things around. There were a number of issues here, so obviously product, you've just described that and some of the challenges that you were facing there. What was going on in terms of customers and growth?

MATHEW
So, I think if you look at it, a couple of areas, why was I brought into the business? One is we had high customer churn, so if we did secure a customer that'd be gone in three months’ time, we weren't securing any customer growth. So, those two customers we had were not growing any further, and we were unable to really stick and land any new customers at all. And what that really meant is we were burning capital as a company. And so, if we break those three areas down, new customers, we're unable to convert a new customer. Our product and technology stack, we were spending all of our time on putting out historical issues rather than helping to solve the real issues of our customers that we're identifying. And the third area is we weren't proving customer value enough to get those existing customers to expand or a new customer to sign up with us.

OMER
Okay, got it. So, it sounds like this is a business with some potential, which is probably why you agreed to take on this role. But it feels like a messy situation. It's like you're burning a lot of cash trying to keep this product development going. It doesn't really sound like a product business. It sounds more like a dev shop building different software for different customers. And so, you've got to come in and say, okay, well, we're spending all of this money, but at the same time, we need to invest more in the product and get this right and turn this into a product business. But at the same time, you don't have revenue coming in beyond what is already there. And so, it's like, well, we also need to go out and get new customers, but if we get those customers, are they just going to churn because the product situation isn't what it is. So, it sounds like a pretty messy situation. So, as you sort of took the job on the first 30, 60, 90 days, how did you try to make sense of all of that and figure out how to prioritize what you were going to tackle?

MATHEW
Yeah, and, and probably on top of that, the angel investors have been very supportive in the initial days, were probably just getting a little bit frustrated. They couldn't see any light at the end of the tunnel. So, that also made it a lot more complex. When I came in, coming from a sales, marketing and product background, the first thing I want to do is talk to customers, understand where the pipeline is, what they value in the product and what they don't. And really looking at why couldn't we sell when I dug into that a little bit more deeply? Obviously, because we'd hypothesized that we'd had really good, true product market fit. The team had actually scaled up our sales and marketing arm, which meant we were spending a lot of money on salespeople who weren't able to convert.

We'd also brought on third-party sales channels and we're hoping that they could also sell and convert. And we were paying a third-party sales organization to develop leads and prospects for us. So, all of those aspects, they created a lot of noise. Right. And a number of them created a significant level of cash burn as well. So, one of the things I quickly realized is that one, the third-party channels that we'd engaged, they weren't being successful at selling, so they were frustrated. So, what we had to do is terminate those relationships, so we didn't burn them any further. We had to look at. Right. Okay. And my principle is if our own team can't sell, there's no point engaging a channel or a third party or setting up a channel sales team because you obviously have improved product market fit, what your value proposition is and how you can continue to scale therein. And we also have to shut down our third-party call center that we had overseas that we're investing significant money in.

We're also investing money in marketing and PR, but without demonstrating true product market fit and that we could continue to convert customers, we had to put that on hold, stop burning cash. Then we started to have a look at, right, what was happening with our existing customers and the ones that were at POV. If I break it down from a sales process, we probably had an inflated expectation as once you got a customer to proposal stage or statement of work, they were naturally going to sign. That's not the case. That's where a lot of deals fall over a proposal statement of work and RFP stage. So, we had to go back to the drawing board and figure out, right, how are we proving value? And the way I've always looked at it is do we compete on product price or service? Now, price wasn't really the issue right then. We obviously didn't have a product, so we had a couple of customers.

So, how could we wrap our arms around them with a service-based organization, not selling professional services, but just better support them to get the most out of our platform and ecosystem and actually learn to bring that back into our product and mark a product tech function to go. These are the features that we need to develop. So, we went about that stream of work. So, wrapping our arms around our two customers and we were doing one in POV. Now, the issue with the one in POV stage, big global organization, but there were so many detractors in that organization that we were being set up to fail. So, we essentially had to go into hyper keep and wrap our arms around that when we'd meet that customer maybe twice, three times a week to continue to make sure that we were better understanding the value our platform was providing to them.

How do we continue to articulate it back to them to create stakeholders that wanted to continue to invest with us and provide them with the tools and artifacts that they could start messaging more internally around that organization. And in parallel, we have to look at where we're spending our time from a debt point of view, as I mentioned, we're spending 95% of our time putting advice and you can't just shut that tap off because if you shut that tap off, we're going to lose those two customers and the one on the POV, right? Because we're not servicing it.

So, that's a really hard conundrum. So, the first thing I looked at was, right, I need to bring in a CTO who I'd worked with before, a technologist that I could trust, because I could see that having 25,000 loans of code across one product and then another product, and another product was just completely unmanageable. So, I brought in Andrew, a CTO I'd worked with at a company called Sandstone before, and he joined me. And one of the first things we identified together is that actually we need to reengineer our entire data ingestion capability to free up our dev capacity to start looking forward. That process probably took a little bit longer than I would have thought, but at the end of that process, when you do invest in that and you do build from the ground up and do it right, we've got an amazing data ingestion engine now powered by AI and machine learning.

Probably didn't want to build it back then, but it's serving us really well now. We've got the really good foundations to continue to scale and grow. The other aspect I did was because of from a product perspective, I had to bring in someone I trusted from a product perspective who could wrap their arms around what was our product doing back then versus where did it need to get to? So, I brought on a guy I worked with, an Afterpay guy named Alex Wood, and we set about also re-engineering. How do we prioritize features from a product perspective? And how do we rationalize down to that one single code base? That took also a lot longer than I would have thought. I would have thought we could do that in sort of three to six months. To be all honesty, it probably took a year because at the same time, we've got to fund the business and bring on new customers. So, probably within those first six months, we won Lenovo.

Now, Lenovo is a very, very big customer. They had massive amounts of data, you know, stuff that would break us immediately. And in parallel, we had to re-engineer our whole tech staff to cater for their volume while bringing them on board. So, that also derailed some of our plans to merge down to that single code base. But it's really just about going, right? I've got to continue to win customs, improve my product, because we're on a limited funding regime. How do you do that while onboarding customers and setting your product and proposition up for scale? And a lot of that's about how do I manage cash flow, how do I get rockstar talent on board? Like, I'm a big fan of when you're hiring devs, hire the hire one rock star, because one rock star will equal four to six normal devs.

So, if you get the right one, I call them a one-man army, then I'm sure there's a lot of other different terms that many, many SAS founders call them. But if you spend the time recruiting them and it might take you three months to four months to five months to find them and you've got to sift through 400 different applicants, it's worth it in the end. It is really worth it in the end, and they pay dividends later on. Like, I remember looking at how many story points we used to do, a sprint might have been six to eight back then. That was including bugs, which is really low. Right. And now we're up to well over 100 in one particular product area. So, I think keeping a real lens on where you are spending your time and effort from a dev perspective is really important.

OMER
Okay, so I had three issues there. One was around the data ingestion and having a better capability there to onboard and manage this data from all your customers. Number two was trying to get to a single code base as quickly as possible. And the third one was having a scalable product that could handle some of these big customers. Like, signing up a Lenovo is great, but if we can't scale and actually deliver on that, then we're still kind of a little screwed. So, all three are like significant pieces of work, and as you said, they take time to get done. How are you funding all of this investment in in the product engineering? I mean, at 6 million ARR and, you know, 1618 customers, I'm guessing the average contract value annually is probably, you know, multiple six figures per customer. Were you using the revenue from existing customers to fund all of this? How much money had been raised prior to you joining? And then also, did you go out and start to raise more money at that time?

MATHEW
Yeah, really good question. So, pretty much within the first three months of the role, we realized that we had to go out and raise money very quickly. And so that was about there's. Obviously, that's quite a time-consuming process whereby you're getting to understand the business. You're trying to recruit the right people, reduce costs, and then telling the right story to investors to make them feel confident, especially the ones that have already been on the journey. It's important not to you don't want to burn them. They were the early guys who saw the vision, so that was a really hard time for us. A lot of sleepless nights, probably. Probably the hardest time in my whole career, actually, was in that first year going, what have I done? What am I doing? Are we doing the right thing? And I think I'm not technically the entrepreneur of this company, but I feel like I've got that entrepreneurial spirit. And deep down, I knew that I could turn this around. Give it enough time, not only bucket loads of money, just give me the time and I can prove I can make this work, because I'm really good at hunting down to find out where the value is and actually starting to extract value both for the customer and us financially.

So, we managed to do a raise, which got us another year's runway in parallel. Remember, during this whole time our product wasn't up to scratch. Right. There's no way that you can rebuild your product, merge all the code bases, and support the growth of bringing on a Lenovo and scaling with other customers. So, what we did there is we're not competing on product or price at that stage. We wrapped our arm around service. And so, we were fortunate to have a really amazing customer success team with a really deep pedigree at quite a senior level, to be honest. We overinvested in servicing our customers and probably even still do today. And one is that's kept us alive and that's kept our customers very close. We've just got that really intimate dialogue and we're starting to architect their own technology roadmaps and strategies moving forward because we've just got such an intimate understanding of their business.

OMER
Tell me a little bit more about what you mean by service, because I think the situation is still, you're trying to fix this product, you got the plane in the air and you're trying to basically build a new plane while it's still going with customers in it. And at the same time, I guess in an ideal world, you'd want to not bring on new customers until you've resolved all those situations because you know that bringing on customers and you already have a churn problem. And so, what was the churn mainly driven by the product issues that you described? Is that the main reason you saw customers churning?

MATHEW
Yeah, look, the main problem was product issues and we weren't proving value because the product was unable to prove the value. And you're right, it was insanely hard for that first year. And you're right, we would have loved to go on. Right, okay, let's get a ten, $20 million raise away and let's just go to ground and build our platform and product. Right. And the interesting part about that is you still don't understand the market as well. So, building the plane while we're flying it, while we're selling it, was actually probably quite beneficial. And I should talk you through some of the pricing problems I had during that journey, because coming from Afterpay we had such an amazing growth very rapidly, where we priced on the successful outcome of a transaction for our merchant, I thought, right, let's just price solely on the successful outcome of a renewal. What I learned very quickly is some of the projects might take three to six months to get off the ground, where we're getting really good data from our vendors, and we are issuing a renewal 9120 days out from expiry. So, the transaction is 9120 days out anyway, once you're live, the time to cash was too far away. And I sort of said, right, let's live and die by the value our product provides. We'll charge between one to 3% per converted renewal. Sounds great.

And what I realized really quickly is that this wasn't bringing cash in the door and lucky. We brought on a really cool investor called Title Ventures and they said, look, you just need to move to a subscription element of the business. And so pivoted very quickly to using the same rationale, one to 3% per converted renewal. But we just happened to split that between a subscription fee and the success component. So, actually, early on, when the customs be signed, most of that just happens to be a subscription fee until we get a really good understanding of their data quality, their renewals book, and how they're embracing it. But really, that was a bitten by a bit of a learning for me, actually. It's just how critical cash flow is. And noting that was built in Arrears, now we're billing quarterly in advance our subscription fees, which just so helps with cash flow, right? And manageability.

OMER
Let me show I got this right. So, with the initial customers, the revenue you were generating from them was all based on transactions. There was no subscription.

MATHEW
A couple were subscription when I joined, but very small. We're talking five grand a month or even less. Actually, maybe three and a half grand US a month. And there were some overs if they went over that. And we'd hope to get the upside when they bring on additional geographies and additional products. But our product value proposition wasn't up to scratch, so that wasn't happening. So, I thought, let's go back to the drawing board, let's just charge purely on success. And that's what I did for a couple of the new customers. But I learned very quickly you can't sustain a business like that until you've got real proof or unless you have a big funding book like Afterpay did.

OMER
Let's go back to the service piece. You mentioned that while you were trying to fix the product, you overinvested in service to make sure that the customers you were bringing on were happy. Can you give us some examples of what that looked like for a customer? Was this about high touch onboarding? Was this more about once they're up and running, what are you doing service-wise to drive the value up?

MATHEW
A lot of our initial success was with companies that sell through a channel, like companies like VMware. We spent an inordinate amount of time enabling their channel partners, getting them to use our platform, taking feedback from them. We realized very quickly, actually, you know what, we don't want another platform. We don't want to use your platform. So, we had to bring in what I call zero-touch workflow, which is essentially set and forget automation. Add your margin, add your branding, add your bank account details, add those all your discount set at once and forget it. And we have to do a lot of onboarding and selling for our own vendors to help their channel embrace the tool. So, that was one area. So, nothing specifically in our own application, but driving adoption from within our own application.

Another one was, our platform does an amazing job, but how do we take the insights out of that? And it's great to have all these reports produced in Microsoft Bi or whatever sort of technology you're using, but unless they're actual actionable and you review, how am I going to change my behavior next quarter or the following quarter, nothing matters, right? So, our team spent a lot of time developing Piloting unique actionable intelligence report that goes to the vendor that says, hey, in order to reduce customer churn this quarter and grow your renewal rate, which grows ARR and grows your NDR, we are going to run your renewals campaign like this. And the renewals campaign changes depending on what country you're operating in. Like the Netherlands shuts down in July. Spain and Italy shut down in July, August. And how do you manage that, especially when you've got a vendor's quarter to hit? And so, what we would provide them with one actionable insights, how to get the most out of that, and actually, instead of saying, here's a list of all your renewals, we'd send their channel. These are the ones you need to action now to exceed your quarterly renewal rate. And so, we doubled down on that area and making, I guess, creating more visibility around what our platform was doing, but dumbing some of the insights down. So, it was action orientated.

OMER
Okay. One component of service was, we're going to provide high touch, we're going to make these people, these customers feel special. And then the second part of this was we're going to basically supplement the lackings in our products, in our product as it is today, or a product that is becoming one product by getting people to work with customers and help them better understand insights and opportunities and how to derive value while the product was kind of evolving and getting better. Is that a good way to summarize what you just said?

MATHEW
Yeah, absolutely. Essentially, we just had to over-invest in helping the customer get the most of our product, and we were using humans to do that and over-investing in customer success until that product caught up. And I must admit we're still doing that today. But what that allows us to do is test and pilot certain innovations before we actually invest in product to see if they're going to work.

OMER
Yeah, that's a really smart way to do that. I want to talk about growth and how you've been able to bring on more customers grow, closing in, what, 6 million ARR the first six years that this business was around? Before you joined, as you said, they only had two customers signed up, maybe a few in the pipeline. What was the problem? Why? You also said that the business had overinvested in sales and yet they weren't able to close these deals. What did you do to diagnose that situation? What conclusions did you reach about the sales problem. And then how did you go about figuring out how to solve it?

MATHEW
Essentially, if I dumb it down and said if I couldn't sell the product myself, nobody else should be able to. And so until I could sell a deal, we weren't going to hire any more salespeople, we weren't going to do too much more investing, et cetera, et cetera. So, doubled down in that area there about doing a lot of the cold calling the outbound myself and starting to uncover the market pain and creating those opportunities both with our customer success team and myself. And we had one salesperson at the time just spending an ordinary amount inordinate amount of time in that area. Probably 60% of my time outside capital raising was probably spent in that area there. Right?

And I think there's a lot of aspect around timing as well. I think the early founders probably just maybe just missed out on timing slightly, ramped up slightly too quickly, and it all compounded. So, the other part we were really fortunate is when I came on board is to one of our maybe the second customer I won, we won together was Lenovo. It's like, holy heck, you sit here in your wildest dreams and go, how do I win a Lenovo? We never would have thought I'd win them in the first two or three years. So, there's definitely a market problem and a need out there. We just have to step up to a different level to close those type of opportunities. And I, and I do come from an enterprise sales background, and I understand that discipline. I think it was timing, luck and just perseverance. And when I mentioned what motivates me is the selling only stops when the customer says no. Right? That's when you double down.

OMER
Tell us what you mean by that, because most people will be like, no customer says no, I'm done.

MATHEW
Yeah, look, I think it means that you don't really understand what their problem is. You need a specific reason, why am I done? Why not now? Have I uncovered the pain? What's the real pain? And how do I create a compelling event around that? And I guess probably early on we even myself was probably guilty about trying to sell a big global deal originally. And what that means is you're trying to embrace a big global program at the same time and you're setting yourself up to fail. I think some of the other coaching we got from Title and early investor was just narrow the guide rails, keep the scopes, narrow the scope, try and prove value quickly. So, instead of doing global deals we looked at, right, okay, let's pick a geography, let's pick a product, let's prove it. Once we've proven it, then we'll expand geographies and products.

OMER
Yeah, that's a really good point. The thing about you going and closing the Lenovo deal, I kind of like picture your dev team going, great job, Matt, but did you have to get such a big customer that's really going to push this thing to the limits? It's like, couldn't you have gone for like a slightly smaller deal or something like that?

MATHEW
One of my colleagues, Randy, our sales guy, he had a relationship with the Lenovo team, which really helped. So, it was co-created by Randy and myself. But also, going into a deal like that, there's a whole lot of unknowns in that and they create a lot of complexities around scale in different countries, different jurisdictions, which brought a whole lot more complexities to the table.

OMER
You focus purely on outbound cold outreach, right? That's been your primary main channel for acquiring customers, right?

MATHEW
Yeah. So, LinkedIn emails, I guess we started to use referrals and found referrals were working quite well. We did invest in one conference, which is the Technology Industry Services Association conference, but when I joined the company, the whole world had just shut down by Covid, so everything was still done remotely. So, there was no face-to-face networking. But you're just hard graft trying to figure out what is, what's the message, what's the call to action to get one of these executives at one of these big tech companies or these tech companies to talk to us.

OMER
You talked about kind of putting on the guardrails, narrowing your focus on the customers. You were going to go out and try to win. And I've seen this over and over again, when somebody has a product that can potentially help all sizes of customers in numerous verticals across multiple geographies, and they're trying to reach out and close deals across the board and the message just isn't resonating and there's no focus. And being able to limit the scope and get hyper-focused on the type of customer you're going to go after obviously has its benefits, but it's really hard to figure out who to focus on, which vertical, which geography, which type of business. Right. So, how did you figure that out? And hopefully, there's going to be some nuggets in there that maybe somebody who's struggling with that similar type of issue today can think about, you know, how they can get a little bit more focused with their outreach.

MATHEW
It's really interesting. Like, if you look at the tech market, the one that we focus on, maybe 40% to 50% of their business is a lot of the time based, you know, American based, might be 40%, is EMEA based. In the other APJ, what we found was actually there was a real problem in EMEA across, you know, we're talking 45, 50 countries. But what that also brought was a certain level of complexity around those 40-odd different languages. We've got to deal with the 40-odd different currencies and the 40-odd different tax jurisdictions and then the 40-odd different ways that they run their calendar year compared to North America. And APJ which were kind of foreign to me and foreign to an Australian-based company.

So, we found a strong appetite for these tech companies. Go, let's go and do an EMEA first. But that's also the complicated market and our preference to go, can we not just go for North America first? It's English. English speaking, US dollars. Okay, the tax is a little bit complex, but it's not too complicated. So, you actually got to quantify the problem. So, then we would get down to going, okay, let's go through each geography and see where your book is as a vendor, where your pain is and right, how many renewals do you have across here? What does your renewal rate look like? Who are the best channel partners? And where do we think we can add the best bang for our buck? What we quickly looked at was, okay, maybe the areas where there was the worst renewal rate, we could actually affect that quite positively quite quickly. If we've only got a 50% renewal rate, there's an hypothesis that we might be able to prove that 10% to 15%, rather than another country where the renewal rate is already 85 or 90 over and above that, we probably have only just really uncovered this complexity is a lot of vendors only quote a like for like opportunity, but like for like is like for like. It's like most salespeople don't get rewarded on keeping my $100 I had last year.

This year, they've got to make that $120. So, we want to quote every single variation to the customer digitally, and that means every upsell cross sell, different term, different support level, plus maybe a transition to SAS. And that gets really insanely complicated. And a lot of the time, the vendor doesn't have those product rules in a central location. They're in different silos. So, we even have to build that product and pricing engine in our own system. So, we could do that on behalf of the big guys at scale, because not even the CPQ systems do that. And so taking that on board, and we've had to sort of temper that enthusiasm sometimes, because we suck up the creation of all of those rules, and there's a lot of extraction and understanding. How should we pitch this particular product or service anyway?

Cut a long story short, the answer is always in the data. Go for the biggest market, the biggest opportunity, where you believe you can affect the biggest value quickly or you can prove value quickly and then maybe expand to another market with VMware. Our first foray with them was into France and Turkey. Now, we didn't know anything about France and Turkey, the way they spoke and their language or their currency. And we went live with US Dollars and English. Right? And that very quickly puts our French and Turkish friends off quite quickly, right? So, we learned very quickly how to take that feedback, and iterate quickly to sort of turn that around. And what we found is once we'd embraced that, we proved value quickly, and then we expanded into the UK island and into the Nordics, et cetera, et cetera.

OMER
Good advice. Yeah, it's a fascinating turnaround story with Renewtrak. And as we were talking earlier, you were at Afterpay Renewtrak founded both companies founded at the same time. 2014, you get to 2021, one is being sold for 29 billion, and the second one is basically still at startup stage. And you're coming in almost as a founder trying to get this business off the ground. It just goes to show you, you never really know, right, when you're looking at the business, when it's starting out, where it's going to be. And I think most people would have probably looked at Renew Track and said, look, this thing hasn't been able to get off the ground for five, six years. There's nothing here. But you still saw something. You were willing to make a bet and come on board. You had people on the team who were willing to stick around and continue. You were able to recruit people who bought into the vision, and now the results of that are paying off. So, props to you for that. And it would be great to see what continues to happen over the next few years with this business. We should wrap up, though. Let's get on to the lightning round. I've got seven quick-fire questions for you, so just try and answer them as quickly as you can. Are you ready?

MATHEW
Yes. Go.

OMER
What's one of the best pieces of business advice you've ever received?

MATHEW
As I mentioned earlier on, the selling only really starts when the customer says no.

OMER
What book would you recommend to our audience and why?

MATHEW
Look, to be honest, I don't read any books, and I guess that's bad. But unless I'm on holiday, I listen to a lot of podcasts. Obviously, yours. And my other favorite one is All-in with Chamath, Jason Sachs and Fryburg. I love listening to podcast. Love it.

OMER
We will accept that as an alternative to a book recommendation. What's one attribute or characteristic in your mind of a successful founder?

MATHEW
Look, it's hustle. Hustle. Hustle. Get things done now. Get it done today. And my other favorite motto is time kills all deals. Whether it's recruiting staff, whether it's winning a deal, whether it's launching a feature, whether it's talking to an invest, it doesn't matter. Time kills all deals.

OMER
What's your favorite personal productivity tool or habit?

MATHEW
My peloton bike, I think. I'm an absolute EDM junkie and I love the indoor for rush first thing in the morning. I just love it. Love it.

OMER
What's your crazy business idea you'd love to pursue if you had the extra time?

MATHEW
Look, it's interesting. I really love building something, and I think I'm a glutton for punishment coming from Afterpay to here. I'm a glutton for building something from nearly scratch and being really proud of that. And I'd honestly love to be a home builder because you get to interpret the architect's plans but build the couple's dream home. And I would love to do that when I get time later on.

OMER
I would love to do something like that too. It's something I think about a lot. It's probably harder than building software, I think. What's an interesting or fun fact about you that most people don't know?

MATHEW
I love volunteering at our local beach as a lifeguard and saved a couple of people from Rips in my time. And I must have been I've also had to be saved myself a couple of times as well.

OMER
And finally, what's one of your most important passions outside of your work?

MATHEW
Look, as I mentioned, I think it's in no particular order, so my wife and kids won't thrash me here, but exercise, love my exercise family and I'm also a self-proclaimed master chef.

OMER
Wow, you're a man of many talents.

MATHEW
Maybe.

OMER
Awesome. Well, thank you so much for joining me, Mat, and sharing your story. I think it's really fascinating, as I said, for a business that really seemed to be going nowhere for five, six years and what you've been able to do and to try and turn that business around and we're seeing the results of all that hard work now. If people want to check out Renewtrak for themselves, they can go to Renewtrak.com that's Trak with a T-R-A-K, not CK. And if folks want to get in touch with you, what's the best way for them to do that?

MATHEW
Probably just via LinkedIn, Omer. Just LinkedIn. Mathew Cagney with one T, Mathew Cagney.

OMER
We will include a link in the show notes for that. Awesome. Mat, thank you so much. It's been a pleasure and wish you and the team the best of success and would love to catch up and see what the business is doing in a couple of years’ time.

MATHEW
Likewise, mate and love your podcast. Thank you. And as I was saying, I have to stop and call all my colleagues every day when I was listening to your podcast and say, we've got to get this done right now.

OMER
Love it. Thanks, man, I really appreciate that. Cheers.

MATHEW
Thank you.