The SaaS Podcast

How a SaaS Startup Used Engineering As Marketing to Drive Growth – with Randy Rayess [155]

SaaS Engineering as Marketing - Randy Rayess of Outgrow

How a SaaS Startup Used Engineering As Marketing to Drive Growth

Randy Rayess is the co-founder of Outgrow, a platform that lets marketers build and launch interactive calculators and viral quizzes that help engage your website visitors and generate more leads.

Outgrow was founded in May 2016 and is based in New York. The company has over 3000 paying customers and has been bootstrapped from day one.

Previously, Randy worked in venture capital, private equity and at startups in financial services, transaction processing and machine learning.


How do you market and sell a product that your prospective customers don't even know they need?

These customers aren't searching for your product or any product like it. But if they knew that your product existed, they'd buy it.

This week's episode is a story about two guys who were in that situation. They were running a services business and helping their clients with software projects.

And they kept hearing the same question from their prospective customers i.e. “how much does it cost to build an app?”  It was taking their sales team a lot of time to answer this question. So they built an interactive tool and put it on their website.

Then they started customizing the tool, so their clients could use it on their websites. And that's how a new SaaS business was born.

But marketing the SaaS product beyond their clients proved to be challenging. No one was looking for a solution like this.  So they had to figure out how to reach new customers and help them understand that they needed this product.

There are some great lessons here on customer development. And we explore how to market a product that no one is looking for.

Read Full Transcript

[00:11] Welcome to another episode of The SaaS Podcast.

[00:16] I'm your host Omer Khan and this is the show where I interview proven founders and industry experts who share their strategies and insights to help you build launch and grow your SaaS business. How do you market and sell a SaaS product that your prospective customers don't even know they need? These customers aren't searching for your product or any product like it. But if they knew that your product existed. They'd probably buy it.

[00:43] This week's episode is a story about two guys who were in just that situation. They were running a services business and helping their clients with software projects. And they kept hearing the same question from their prospective customers over and over again. How much does it cost to build an app. It was taking their sales team a lot of time to answer this question. So they built an interactive tool and put it on their website. Then they started customizing the tools so their clients could use it on their websites. And that's how a new SaaS product and business was born. But marketing the SaaS product beyond their clients proved to be challenging.

01:23 No one was looking for a solution like this. So they had to figure out how to reach new customers and help them understand that they needed this product. There are some great lessons here on customer development and we explore how to market a product that no one is looking for. So I hope you enjoy it. Before we get started if you need help building, launching or growing your software business then check out SaaS Club. It's a premium membership that I launched to help you get the insites, motivation and support you need to succeed. Registration for new members is closed right now but you can join the waitlist and I'll let you know when I start accepting new members again. Just go to saasclub.co to learn more and join the waitlist. Also if you haven't already grabbed a copy of my free productivity toolkit you can do so by going to theSaaSpodcast.com.

[02:21] It will teach you the habits hacks and tools used by successful founders and entrepreneurs. OK enough chitchat. Let's get on with the interview.

[02:31] Today's guest is the co-founder of Outgrow a platform that lets marketers build and launch interactive calculators and viral quizzes that help engage our website visitors and generate more leads. Outgrow was founded in May 2016 and is based in New York. The company has been bootstrapped from day one previously to launching Outgrow my guest with Venture Capital, Private Equity and startups in financial services, transaction processing and machine learning. So today I'd like to welcome Randy Rayess. Randy welcome to the show.

[03:09] Thanks for having me Omer.

[03:11] Now let's talk about you. What gets you out of bed every day. It's my icebreaker. So what is it for you. What drives and motivates you to work on your business every day.

[03:25] Sure! That's a great question. I think it's. It changes as you develop as an entrepreneur. And I think right now like at this point it's obviously being able to train and train and support your employees help them grow and to help facilitate your customers. Those are like the kind of the day to day grind stuff you know you're helping your customers grow you're hoping employees grow and then so that would be like my short term. The way I look at it and then from the bigger picture the way I like to look at it is that you know we're helping marketers really adapt to this transition that's happened over the last five, seven years in the way we market their customers and we're kind of really helping them change from this kind of you know purely advertising based mentality to a more, to more helpful and value added approach to marketing.

[04:21] So like will help you acquire your lead information. We're going to help you through the process and I think that's going to be a great way for marketers to look at their kind of role and the fact that we're facilitating that and make it easier for them to do it without the technical skills they have anything that's going to make the bigger picture which we like and think is going to make a fundamental shift.

[04:43] So people who aren't familiar with Outgrow can you explain to them a little bit more about the product. What are these interactive calculators and what are they designed to do.

[04:56] Sure! So you know the quick kind of way to think about is that instead of focusing mainly on selling to your customers and just advertising it right you can augment your marketing by trying to create an experience that helps the most common questions your customers have. So if you're selling app development services you can tell them how much does it cost to build a mobile app that's going to help them a lot. So you can build this calculator which assumes that it questions and provide them with an estimate. That's not only useful to them but now you have a lot of information in them which were qualified leads. And so what our tool does outgrow is it makes it easy for a marketer who is non-technical who is not a professional designer to create this experience and launch it without any need for external help. And so that's kind of what the platform does in a nutshell.

[05:45] And where did the idea come from for Outgrow.

[05:48] Sure. We have a second business called VenturePact and it's basically a marketplace for software services. And you know in you find just a bit over five years ago they were very very few companies that had mobile apps and it was like a new platform. And we basically saw that and we ventured out to the marketplace to connect people with development teams and help them build mobile apps at the beginning and then other things as well. And so what we saw was that so many people had this question, how much does it cost to build a mobile app? How much does it cost to build a web application? You know depending on if your using Android or iOS and web kind of all these different questions that people would come to us with. So when we launched this experience we launched this and just help our salespeople were just repeatedly saying it depends.

[06:32] Of course it depends here we would send them something automatically. They can do it on their own and get a pretty good estimate. And it became such a big lead source for us that we thought other companies should do it and that was kind of like a marketing strategy right. Eventhough it was something we built with the team. It was a marketing strategy and so that was the that was kind of how we came up with the idea and then when it works really well and the time was right we were sufficiently far along into the business where we thought we could kind of launch a separate product to make it easier to do it. That's when we did it. That's when we started out. So that's how it's developed.

[07:08] So when did you realize that there was another business opportunity here.

[07:14] So I would say between two and a half to three years ago so about three years ago we were kind of starting to see that this is something that's interesting. We just wanted to wait for a few things. One was it was working really well for us. You know what does it work on other verticals. The second is let's see kind of this is going to be how people how receptive it is for other people.

[07:34] And the third is do we. Are we ready to kind of you know, is VenturePact in late stage enough where we can kind of we have two products at the same time because you can't you can't start two products at the same time it's very difficult to do that so it is very very tough and the process that we could do that so those are the things we want to look at, to reap patience at the beginning, and then we started testing it with our with our VenturePact customers who were building custom software. We started it with the marketers on that platform trying to help, get their feedback and have them try it. And when they they had that kind of a demand for they liked the concept that's when we started to see that you know it can go beyond you know consulting or services-based applications that you can build the recommendation tool you can build or like calculators or even build an estimate or you can build an outcome quiz or an assessment because so many different things you could build with these types of experiences that can go beyond just that. The example that works well for us.

[08:35] Did you charge these customers initially or your VenturePact customers for the product.

[08:41] Yes. Yes. So the reason that we were the reason we could charge them was I mean there are they are two options right. They could either build this thing custom and they were already paying a lot for other custom software projects with us right.

[08:53] Or they could use Outgrow and pay you know most of them are paying around anywhere from $45 a month up to a few hundred dollars a month. So they could be like a much more a you know favorable fee than dishing out a bunch of cash on our customers projects so we could charge them and we had that preexisting relationship it was a bit easier for us, given that we had an existing network to acquire our first customers.

[09:24] So it was really a no brainer for these guys I guess.

[09:29] Yes. With people right. If someone's willing to do this custom right then their ability their willingness to do this as a product is kind of a no brainer right. Because you're you're you're just there's a there's a couple of orders of magnitude cheaper in terms of cost right if you want instead of a thousand or maybe maybe an order of inserting a thousand dollars you'd take at least 10,000 for or around 10,000 for maybe one involved experience you know. So it's a pretty big difference. And with that 1000 You can build multiple. And you don't have the back and forth willingly though there is a lot of benefits. So we thought it definitely no brainer. But you have to also think about the types of companies that we were talking to we're talking to innovators were talking to people who are ahead of the curve who are thinking at that level.

[10:14] So as we at the time you know as you go to other people who aren't as aren't as experimental or as comfortable kind of going ahead of you know being kind ahead of the crowd and then then they're not as receptive. They're like oh let's let's wait until all are like a good percentage of our competitors are like successful with it and then we'll kind of jump on board. So there is that second component as well.

[10:40] So I'm curious in the first year of trying to build and growOoutgrow what did you get any pushback or objections. Like like how you just mentioned from people. And did you have any surprises once you know real customers started using the product.

[11:07] Yes to both. So the the first part which is pushback. So we have a lot of objections that were companies will come back. Right. So marketers can inject it so early on we didn't have many templates so that design templates. And the reason it's so easy to use is because we have preexisting design control. So some companies will push back and be like no I want like more design templates right. So that was like things that related to product and we basically said okay we're going to build more. Obviously this is going to like a work in progress we we're going to meet the designers on that. But then there were more fundamental question people had was like oh like okay we're going to launch this kind of calculator, creator what should we what should we do with it. We put it as a social post should we put it on our blog is it or is it like a content marketing strategy or advertising strategy or a landing page.

[11:54] Is it is it what happens if our blog doesn't have any of that much traffic so there's all these questions around positioning that we havent't really figured out. So we didn't really know. For us you know the fundamental calculators and quizzes which are really court your sales the sales process you know we make them separate experiences and those are clear. And then for things that were more content based that would be just like a blog post or a fun assessment. The promotion strategy of like over this type of business that we've experienced lately is entertainment experience that should be done on social and this is kind of how it should be done for this business for this type of consumer.

[12:34] Those types of things we didn't really have a lot of data to optimize for so we couldn't tell them. Oh these types of people targeting consumers and these type of areas saw a lot of success by doing this right like creating a fun quiz with this that outcome page and promoting it in this way and using this template. The odd type of data we didn't really know exactly. So we we had to tell them like hey like we have some data but we don't have a lot of data on this so it's going to be within an experimentation process and we're happy to kind of work with you on it. But we don't know the exact answers to these things so those are things that we had to we have to handle early on. And so you need people with an appetite for risk for those things.

[13:14] Your second question around the first one was that the people push back and the second one was…

[13:23] You had a certain set of assumptions when you went out there with this product but inevitably when when real people start using it they often come back with feedback that you didn't expect. And so that's what I'm trying to get to is it did you did you get those kinds of surprises in terms of feedback that that challenge or your assumptions or made you think differently or made you kind of changed the course direction that you were taking with the product.

[13:56] Yes we got a lot of interesting feedback.

[13:59] We had a you know a customer come to us and say they want to include in their VR experience. Right. They want to have kind of VR experience and part of the VR experience to be have some sort of interactive content and we haven't done any 3D visualization or any kind of work in that space before. We had customers come to us and say like hey I don't just want this for myself but I want this for my sponsors like sports brand. They want it for their sponsors and their sponsors. Concrete co-branded experiences. Right. So it's not just me you know actually the sports team it's actually the sports team and the sponsor creating this kind of interactive piece of content so how can we how can we track an advertisement within the experience so I might have you know seven questions. I want to put an ad between two and three and an ad between you know the last question of the results.

[14:49] How do I track it how I charge for all these questions that we were like oh like it's not even like we were thinking more of like oh you're qualifying your lead through the questions and you acquire the lead data through the leadgen  form. That was the way we thought about it right. And as easily as people type of thinking about this thing and meeting these very different perspectives and you have to decide these are all amazing ideas. But you know we're trying to figure out where to focus our energy. And so we could you know early on we started off as a calculator right tool and there were a lot of feedback. They want a more advanced recommendation type functionality to recommend what church you should wear and things like that. We got feedback to add more like outcome quizzes, assessments graded tests, all these things.

[15:33] But we took them in a strategic way we didn't just like say oh we're going to build everything mediately. And we took them one by one. And as the feedback came on we expanded and so now you'll see all the different functionality but we didn't roll out like that. So that was based on the feedback we got. We chose ideas there's a lot of feedback we've done that we haven't taken or we haven't got to yet. So it was actually very surprising because it was just an overwhelming amount an overwhelming amount of feedback on what we can do and what we should add to that.

[16:01] So as we said you guys launched in May of last year.

[16:08] Yeah like a more publicly was when we were more more public.

[16:11] And so how long were you working on the product before then.

[16:16] So that was one of your name of course and just about you know I would say six months to a year before that was when we were doing or more like internally within VenturePact type of testing. So we were just it wasn't like public no like no non VenturePact customer it was kind of like using us or working with us. So it was mainly just the VenturePact tech people from our from our other business.

[16:35] Got it. So let's call it like you know two years that you've been kind of working on this as I mentioned earlier the business has been bootstrapped from from day one and you now have about 3000 paid customers.

[16:56] And these are people your plans on your website range from $25 for a freelancer through to $600 a month for larger companies. So presumably you've got a mix of those people there and the team you've grown to 40 people now. So you know for a bootstrap business that's pretty rapid growth.

[17:24] Now I want to talk a little bit about what has driven that growth so you obviously had the existing customers with clients from VenturePact to help you get some initial traction the feedback and so on. But beyond that what what were the strategies that really worked in helping you find new customers and grow the business faster.

[17:56] That's a great question. So you're right definitely having the advantage of seeding our early customers was it was a huge advantage because now we could say like oh we have some customers we have some case studies. We have some reviews. And so that was very helpful and sort of kind of going out cold and saying like hey we have zero customers,  zero reviews can use our platform. So that was kind of, definitely, very helpful.

[18:17] The second thing was we had a lot of experience in events so we had done events in the VenturePact business.

[18:25] We had seen how events what types of events work best for us. And so when we went to do events for Outgrow we were we were able to get an ROI much faster so it took us about two years to really figure out what we're doing with events and then right from that first first event we were, we were kind of seeing it work closing deals from that. So our event strategy was just much faster in terms of executing on events. And so that was a good challenge for us. So we were basically saying hey this is something you're not searching for you're probably not looking for. But this is why you should try it. And most  of you know marketers who come to events that are about you know digital marketing or events that are about more about kind of innovation and how you can improve the way you market it didn't have an appetite for trying these things.

[19:12] So that was a good strategy for us. The second thing we did was so we obviously are promoting this concept of kind of building interactive tools to help the customer and  help with the marketing team as well by leadgen. So we want to we want a lot of experiments we see a lot of like you know basically every week we're running different types of experiments will run different types of calculators or quizzes and we'll try to see what works best with a customer. How should we launch it. How should we promote it. So we use a lot of that you know our own products to market ourselves and to help us acquire leads. And then when we send it to our salespeople, right. We have an integration and then it's a much kind of easier thing for them to do because now we can our lead scoring is a lot better than just you know give a name and an email.

[19:59] You have the answers to a certain set of questions usually between four or eight questions. In addition to name email so suddenly your just your ability to segment and lead score and prioritize is going to be much better. And so that's been helpful for us as well in terms of me able to prioritize your energy and the salespeople prioritizing their energy. So those are a few things that really kind of helped us early on kind of in our growth case.

[20:20] Okay. So let's talk about the events. Can you give me an example of an event or type of event that you have tapped into and what you did there too to acquire customers.

[20:37] Sure. So we we as citizens that we like to do our events that aren't massive.

[20:45] So we we the masses of answer are just kind of super overwhelming and they focus a lot on kind of the standard the standard trends right. And so like Facebook marketing and social media advertising and things like that and it eats up a lot of the content and there are some events that are mainly content-based events where you just have a sponsor put their logo. So those ones who might do some of those but those ones are the ones where we kind of will do many. But the types of things that work well for us and at times events where there is a lot of time to meet the actual people or the event and where we're able to either give a speech or comment or meet with them one on one. So that those both do well for us. The mid-market marketers do well that's going to make an area that resonates all of them in terms of speed at which we can close them.

[21:34] Their interest their ability to pay and things like that. So those kind of tend to be a good area for us. And so we'd like to do those types of events again and we will do some larger enterprise type events but those are just going to be a longer payback period. So you're not going to close a deal with the large enterprise usually in first few months and you know maybe for the first six months it takes a lot of time to kind of get those closed. You got to have to you have to have good expectations going to an event thinking okay this is when I'm going to be able to get paid back. So I would say the things that worked well with us in summer would be mid-market digital marketing.

[22:08] Digital innovation you know digital marketing innovation digital marketing software. You know technical marketing or you know the marketing technologies those types of titles which are a lot of there's a lot of new titles like chief digital officer that are coming up.

[22:25] Those are the types of events for those kind of people are good for us and those are the ones we do well.

[22:30] Number one I guess is like you know picking the right type of event and through trial and error. Presumably you've got a lot more focused on what type of events work exactly the kind of person you are looking for. And so you mentioned presentations. I know you are typically looking for an opportunity to go in there and do a presentation and presumably talk about marketing and some sort of link to outgrow in terms of how they can acquire new leads. Or is it just the opportunity of being somewhere where you can network with people and have that one on one conversation to sort of effectively to you know tell them about your product.

[23:14] Yeah. So the reason I think the thing I want to qualify about this specific answer that I'm going to give it the the answer will vary by business. Right. So for us specifically Outgrow is a company that is a type of product or type of streams that many marketers aren't actively searching. Right. So we have to first educate them in the concept in the category right. And then explain to them why they should use Outgrow specifically. So first get them excited interest in the topic and then say this is why you should use Outgrow versus you know building a custom or or we're not doing it at all. Those are kind of the three things that we sort of think of. OK. First the main thing that people are doing is not doing it at all. Right. And then only by doing it cost them and then you make sure you get a product that is cheaper faster better.

[24:03] So those are kind of that's kind of the top process we have so the good thing about the talks while they're very expensive. When we're able to go there and kind of educate them on the concept and on the category then we at least establish some interest in the in the category where they're interested in learning more. And so that part's important. So then they're more excited to come to meet with us and to talk to us afterwards and even during the networking parts or during the booth part or whatever whatever kind of whatever structure that the event has. So I think those are the that's why for us when it was me you know I know some people who don't do any speeches and they've done well at events but I think the main reason is that they're not in that category has a bit more is a bit more mature and is a bit more education and knowledge going around how it works.

[24:53] Right. So if somebody was looking for you know if you're in a CRM business you don't need to spend a lot of time educating people on what a CRM is and why they should use it. Right. Whereas with you it's almost like a new category or a very unique category.

[25:11] And even though people might they have the problem in terms of you know they want to figure out how to generate more leads to something like Outgrow is not something that would automatically be top of mind when they're trying to figure out a solution. Exactly. And that's a perfect way to put it. Ok cool.

[25:27] And so let's talk about the other piece you talked about you know leveraging your own product as a way to grow and I guess there's like probably two parts to that like one would be like using Outgrow and building your own you know calculators or whatever as a way to engage people and generate leads. And then I guess the other one is the built in virality that comes with using a product so every time somebody is using your product there's an opportunity to.

[26:09] I don't know if you actually do this I didn't notice this but I presume you are doing something like you know powered by Outgrow or something like that somewhere as a way to kind of spread the word as well.

[26:20] Yes that's true as well. So I would say they're kind of the main is the main question around kind of how we execute on it and what was what's worked on our AB testing process because they're going there's going to two parts. The AB testing process how we learn what works and then the that what has worked is like what we have what we found to be more successful.

[26:41] Yeah I would say let's start with like first of all like give me an example of you know maybe the interactive calculator quiz or something that you guys are using yourself to generate leads or sort of specifically things apart of ike the powered by Outgrow. Are there other things within the product that you're using as a way to get the word out so that I think will help us understand the baseline and then beyond that I think you know I'd love to talk about the AB testing after that.

[27:12] Perfect. So the types of things I mean so the standard thing that you'd start with is like what is the ROI of using Outgrow software. Right. So that's what the necessary thing would do in a B2B setting, usually you start with an ROI calculator. The second thing you'd look at is kind of how should you invest your digital marketing spend. Or how should you invest your content marketing spend so lot of things we do experiments with. We'll see. OK how much are you spending on static content like your blog. How is that performing in terms of in terms of the number of leads generated and so most people seem like the blog doesn't generate that many leads but it might get some good visits and for a CEO. Okay and then you look at e-books. So how e-books doing in terms of leads and engagement.

[27:56] So how many download it, how many of those e-books are sticking around and purchasing and clipboards that. How does that cycle look like. And so then when we look at Outgrow ok you haven't done anything in terms of interactive tools or tools that actually help the customer or more personalized tools. And then what number do you have for that, most people say no they have not. So there will be like. So right now you're investing in kind of these main categories and so how would that look if you were to invest in these categories as well. So how and how much should you start with. Right. And so we are able to dominate probably should start with maybe you know basic investment if you're still early or if you're later on in terms of your content marketing strategies you can probably start with this type of investment and at least try try this try again.

[28:37] And so that would be type of topic that when we look at you know you specifically look at content marketing and then we'll have things that are like knowledge tests. So way we like to look at it is a funnel. So we see people on top of the fund and we'll ask them like how much do you know about lead generation, how much do you know about your email open score.

[28:58] Right. And so and then we'd ask questions about email open score how does email open vary based on the subject line and how the quiz based open emails and subject lines very improves your open rate or your click rate if you have a fun quiz on an e-mail.

[29:13] Have a bunch of these simple things that are more top of the funnel right there just kind of getting people in thinking about this category and then middle on the bottom of the funnel things will ask things a bit more a bit more specific. Right.

[29:26] So that would be ROI, that would be savings that would be advertising, investing across different categories, landing page performance. How do you run AB testing across your landing pages, you know social posts, engagement on social posts specifically and how you can improve react to those types of characters with quizzes would be more middle bottom of the funnel stuff that we would use. And then to the second part which is AB testing the way we think about that is we say we're going to run a bunch of these right and so will also it will change you know how do you calculate the gain on increasing your blogging frequency. Right. And then I get on increasing your e-book. So then we would try different phrasing. Also within blog with ebook We try different ways of saying it. So I think I'd play games you would say like I can calculate boost, I can calculate lift, right you know or and may have it as a question. Right. You know are you doing everything you can in terms of your blog optimization and then we'd recommend like hey this is how you can improve that.

[30:28] And so we would take a category come up with a list of ideas run experiments and we would try to send them to relevant people. So if someone did a top of the phone experience and we saw them talk a lot about content marketing is a key driver for them and then we'd send them a lot of content marketing stuffs. And then if its social and we try to send in more social type stuff.

[30:48] So we we the the key is that we look for an AB testing is the click through rate on the email the the open rates the click through rates we look at the where they drop off within the questions and that kind of quiz you know is there any data on the accuracy of information or providing an email verification so we can tell. Like do they first get a false e-mail and then because it was embarkation to they undermine email. They give them the real e-mail beginning and then they click the CTA on the results page.

[31:17] So we look at all these things. And so obviously if people do the whole thing. But they're really you know I think the CTA and they engage a lot.

[31:24] Can you give us an example of a customer who has used Outgrow and maybe describe like what kind of calculator they built and sort of what sort of results they got from that.

[31:39] And if you can't talk about company names or something like that that's no problem. But I want to try and get a sense of sharing with people saying like you know a good example the case a sort of a mini case study of what somebody built and how it improved their ability to generate more leads.

[31:59] Yeah that's a really good question. So again you know two or three quick examples. So we hire basically a company that was like an online book retailer. They sell books online. Right. So they're like the equivalent of Amazon and they're not like they may do something similar to Amazon, they much more than Amazon. So they basically sell books online. And so they had the idea of like oh let's kind of come up with different ways to recommend which book you should read next. And they created this and they promoted them on social. One of them and email lists and they were able to generate within four or five months over 90,000 leads. And so it was a very successful process. Now the reason that worked really well was a few things just a lot of people thought like it was just copy that they put a lot of thought into how the major puzzle is going to work and what question they want to ask.

[32:47] So the first thing they did. Well the second thing they did the well was how they handled the leadgen form and the sharing. So they really wanted to promote people to show that people share the experience when they were done, right and not just going to see the calculator and click on the link to go buy that book sorry. Click on that click at the end under the results page. Now don't just buy the book but also share it. And so they kind of came in with that strategy and getting there getting that getting people to share it and having fun results page with with a good recommendation is how have we got free free extra visits which got extra leads right because otherwise you have to pay a lot to get that much traffic to get that many leads.

[33:32] And so you know there is a luck component to it you can't like guarantee that many people are going to like share it when you you don't know that going into it you can't like oh I'm going to build an automatic virality. You try to incentivize virality you try to encourage it. But you're never sure that one it worked really well and it done very well obviously in terms of they've been very successful it's kind of surprising for us to see it grow that much so that one was a great example. There's there's a lot of like fun examples that do really well so like the one did really well was there's like two famous Cricketers one is Collie and one is Tendulkar and it was are you a Collie or a Tendulkar.

[34:14] Right. And that was like an engagement strategy for like universities to engage with high school students and their kids during testing students. And so they they posted that and it went you know it did like six, seven x better organically than they are in their tade posts. Right. In terms of. So they were basically focused on engagement and their usual their usual click through rates and the usual engagements they have on a post. They would probably get you know around 30,000 kind of click throughs and with Outgrow they got you know over 200,000 right click throughs and the engagement. So it was like a significant significant improvement in terms of engagement. So those are kind of two fun B2B, B2C examples. And then I'll give you a couple kind of good B2B. So we had we we have kind of this kind of company in the base of launching they were launching this kind of new product and they wanted to educate people in terms of why they would need that new product. And so they created a equivalent to credit score for your data quality. So they are indeed a quality product that they were launching and they wanted to say we we're going to create a vertical it's good for you to call them and we're going to ask these questions like a very sophisticated attack a lot of math behind it but so it took a lot of time to really kind of hone in on how the math is going to work and how we're going to do the numbers. And sometimes it's not like a trivial thing to do but because they did it really well.

[35:51] It ended up doing it ended up getting not only good good start rates but on the results they got a lot of kind of requests for more information. And so you want to look at not just how many we're starting it but what people finish is they are the interesting kind of thing. Oh look it's actually something that I I should work on. Right so you get your score and you'll see like where you lie and then when you can do to. And that what you can do to improve doing that well which is using our conditional messaging feature is really important because that's where you know as the as the business taking the experience you're not telling me what that I'm like a B minus in you know approximately what they're saying. These are the things you can do to improve. And if you think those make sense then your trust factor for that business is going to go up even though you've only spent like you know maybe three minutes with then you were ready.

[36:48] You already have an additional trust and that's going to pretty cool in terms of the speed at which you can build that.

[36:53] Because many of them know that you actually know what you're doing and you have a lot of experience in space now for somebody who let's say you know is a founder of a SaaS business and is listening to this and thinking you know that you know it sounds interesting but I'm not sure if that would work for me.

[37:15] No they don't really have an idea of the type of calculator interactive calculator they would build. Can you offer just some some general tips or ideas that might sort of help them think through how to come up with a compelling idea.?

[37:36] Sure. So there's kind of two things we always see. One is you have to experiment to see what resonates best with your audience. But when you're starting you usually have a very good sense just by asking your sales team for their most common questions and asking your customer success and customer support. What are the most common questions they have. Those two lists of questions are going to be really useful.

[37:57] And you know so you'll see that because that means they're getting a lot of question around quotations. They're getting a lot of questions around our why in value. They're getting a lot of questions about when they're using the product they're getting a lot of questions around you know which features should they focus on based on their business.

[38:16] And so you can have an experience like assess assess how well you're you know you're doing in terms of usage or in terms of how you're promoting. So for us it would be like we will tell people assess how well you're promoting your experiences your active content evolve and outgrow and we can then tell them hey you're only getting you know you're only 60% really there. These are what this is what you should do. So that's kind of a hopeful experience that usually our customers support because most of us has again work with them on manually. Now we can send that to them. So those are things that are there that are great and you'll be able to just take the top 5 sales and the top 5 customer support and success and that should generate around 10, 10 ideas that you can. So you know I want to start with these three but you'll have 10 that are great candidates. That's the most common way people start. They ask the salespeople for those questions and they ask for customer success.

[39:09] We talked about sort of where you are in terms of you know 3000 paid customers, 40 people in your team and you and I have been talking for a while now and it seems like every time we talk the numbers get bigger. Right. So say you guys are obviously doing something right and it's helping you to grow the business. But I also want to try to figure out what have been some of the hard things what have been some of the challenges that kind of result in you guys losing focus along the way or just have it's experiencing some some pain. And so I know that hiring has been one challenging area for you in the past. So can you can tell us about that what what has happened with you.

[39:56] Sure. I think I think sometimes the way you like to think about it depends on the person but like my. So my co-founder Pratham and I are both both kind of thought at the beginning but you really want to focus on intelligence and when hiring people.

[40:13] And so it was very very focused on kind of what we want to hire really smart people. And I think the. Thing that people who are more math oriented they think of management and culture as less important especially early on. And we we we definitely we definitely kind of made that mistake. And so when we were hiring people like importing people so early employees or leadership people people who are in leadership positions we didn't we didn't look at cultural fit as much as we should have early on and we didn't we didn't check enough references so we just looked like a couple of references that we the people they told us to check. Right.

[40:52] And we are taking a lead someone is going to be a leader right. He's obviously going to be able to at least generate one or two people who he's worked with or he knows well who's going to say something positive about him or her. But you want to do a thorough review of the references and you want to really think through a cultural effect.

[41:11] And so what matters to you in terms of the attitudes of the person right in terms of their personality in terms of their leadership style. You know have they led before or are they just super smart and you think oh they've done well in in a year also. Let me just put them in a manager role because they're really smart.

[41:30] But that doesn't always translate well. And when you make that mistake the reason why it's so costly is because it takes when you identify the issue you want to try to make it work in the beginning because you like thinking and you will you want to get the person at least a couple of chances so you're fair to them. And you also want to make it work because you know you know that you replace that person is going to take a lot of time and you already have so many things going on. So you're good going it. So then you know it makes it much harder for you to slow down you have more anxiety and more stress, the team everyone under done who you've spent so much time building up and training is now not happy and they're frustrated and you might lose people.

[42:08] So there is a lot of consequences from this one bad decision is you've got to be very careful. So this kind of consent that we were we had was like oh we can hire people fast and then with we identify it's a mistake we can work or that or department or separate ways quickly. That's that doesn't work as well for leadership positions where they are influencing so many people below them.

[42:29] So definitely recommend taking them very seriously and and being a bit more patient thinking about what other things we should really look for and what are the things that matter to us so that we don't hire people who are just smart but they have no know called the cultural fit is just you know what do you do now to assess if somebody is is a cultural fit for you. Just so that's a that's a really big challenge right because if you ask someone are you positive. We want to hire positive people who are hard to take on the most dangerous in the world. So you can't you can't. There's a lot of things that are not easily identifiable. Right so we just say like we try to just put them in situations and say we asked them about like we were. Tell me about situations you've been in where you've had to meet someone you know what are the issues that have come up and how you handled them and they just talk about the way they think about things.

[43:24] Talk about the way they perceive things and you'll be able to say that they might be doing things in a right way. Right. Or án in a way that makes a lot of sense but that's not relevant not monster not relevant but not a good fix for the way you would want someone to handle in your company. And so we try to put them in situations we take references a lot more seriously. And so it's not like oh we're going to call the one or two people who told us to call and we're going to ask them why. Oh you know like so how was that guy. It's pretty good. That's not useful. Everyone's going to say pretty good that that has no information to you but you've got to ask smart questions when you do reference starts right.

[44:00] So so that you want to see that you can really dive deep into what are the issues because especially the first couple of reference test that you're going to talked to. They're going to say mainly positive things. You need to dig a bit deeper to see like no one is perfect and that's fine. We're not saying we want to hire perfect people, we want to understand where were thei weaknesses and are they these things that are you know inconsequential or not significant to the way we want to run or are they like super significant. And so that's where you want to get a few extra inspects if you want to be the more startup.

[44:33] So those are a few things we do with them and then of course not just interact with them in purely an interview setting trying to interact in other settings as well like over a lunch or with having them interact with other people in the team informally.

[44:48] And so that you can just get a sense of them when they're not under the kind of we're both sitting in front of each other and this is like a you know as you know organized formal interview. So there then you get to see them in different scenarios and you get to see how the how they approach that different settings.

[45:05] Now another area that you know we talked about was a lack of focus in the past and how that's been a challenge for you guys. Can you talk a little bit about that.

[45:18] Sure. So this was definitely relevant for our VenturePact business and even relevant for the Outgrow business.

[45:25] We we are very passionate you know me myself, Pratham and our especially our early hires we were just sort of a mix who were passionate people and we had this kind of mentality that when you have to be like a bit overconfident right as an entrepreneur otherwise you you'll get you'll just gets to hang up on things and you'll quit early. So you got to be a bit overconfident but I think our the level of our confidence we had was too high and we thought we could do anything, we thought we could and take on every customer, we can get to start.

[46:02] You know we should go after enterprises enlargement markets and market in small business and even like freelance and young mom and pop shops and we can kind of work with everyone. And that kind of mentality is actually very difficult. Right. So a crazy entrepreneur might be able to convince themselves that they could probably do it especially if you like you can learn a lot and you can learn about different industries and you can learn about the names of companies and their processes. But you have to understand that when you as you grow the business you're actually going to hire salespeople and you're able to get a sales person like hey I need you to learn everything about financial services, health care, insurance, e-commerce, sports, etcetera, automobiles, logistics and you're going to have to handle all these companies also by the way you're going to have to understand how to sell to these different roles because in a bigger company you're going to have to go like to the top and come down or go into the middle and come up.

[46:53] And there's going to be different processes. So by the way we have to learn all of them and that's not possible. And so you realize you realize the limitation that you have. And then when you start hiring marketers like wait, who am I messaging like what's who am I targeting you like everyone. All right. Or you know every marketer every every CIO every CTO every chief product every chief digital and that's also a challenge. So those are all things that are real issues that that I think are are things that you've got to understand that focus just gives you so much more clarity in terms of what you should do in product what you should do with marketing how you should hire and train salespeople. It just so much easier.

[47:34] So and it seems counter-intuitive you like I'm limiting myself. There were entrepreneurs like what we can really bootstrapped entrepeneurs you want to like take everything you can get. So it's a hard thing to train. I think people have told us this before but I think was only after we went through it and actually witnessed it and kind of fully understood it and we realized why they said that.

[47:57] And so I'm I'm because when I look at your pricing plan I see sort of it starting out at you know free on supply and then it goes to central business and then there's even an option for an enterprise plan. So that on its own seems pretty diverse having to accompany it as a freelancer versus enterprise. How do you rationalize that.

[48:22] Yeah that's a great question. So the the way the freelancer Tyne-Wear has been added I think in the last maybe 8 months like this year sometime this year I think it was added. So we always have a freelancer point. It was just for small business and the freelancer client is not something we do. So you have to look at the way I think a lot about like our outbound strategy versus inbound. So inbound freelancer people can come on they can use the products and it's you know it's just part of Outgrow and they're helping us market our product. And it's mainly self-service. And so that doesn't require salespeople that doesn't require one is to say OK they want to use they can. And so really what we've been through what we started focusing on is really the mid-market right to the business plan and out was that was what we would do for outbound and inbound and we'd focus on that for inbound.

[49:12] So we would try to generate those inbound. We might get people other people but at the beginning it wasn't really a shift. This is for Outgrow specifically for VenturePact, we went after everyone a lot. But yes we had removed we we said that we wanted to remove kind of those that like any attention to that category because and only have kind of look like a higher price. So that was where we where we focused mainly on the business plans and then we added We out of the essentials like soon after so that we could kind of give people something where they could go ramp up the business so people who weren't who might have been a bit smaller and they said they want to start with something small like experiment and then look to business is less that's only we added essentials which was probably like a few months down the line from business and so but I would say the the way we've handled it internally is we said our outbound strategy when we go outbound or when we do events is we're mainly on midmarket and we're mainly focusing and then in terms of verticals are our sales people are focused on certain areas we have like a salesperson's focuses on financial services insurance right. And these people will do financial services insurance midmarket. And so that's kind of a much easier focus.

[50:25] They're not trying to run after everything and in the same for the same for healthcare, the same for e-commerce, things like that. So we have to have focus on be on the hiring part. And then it's mainly mid-market that the that they do. And only recently have we started to say oh we're going to hire we're going to like really start to think a lot about agencies and enterprise and so that wasn't something where we like we're aggressively doing. We might have done an event as an education. We do like advanced education. We'll do like Enterprise events to learn more about the vertical maybe get a couple but that's mainly handled by me or in sales which I'm in was for a while and who can handle that. So we can and are very thoughtful about who we're handling and why we're doing it and things like that. Now that we have different verticals in there mainly saying okay this is for inbounds or for outbound and for inbound. This is where sales are going to focus on sort of marketings going to focus.

[51:25] Right. So I think the biggest takeaway for anyone listening to you describing your experiences don't try to do it all at once. Right. Yes you can. You know you can try to do all of it over time but you've got to sort of you know break it off an indigestible chunks that you know you and your team can handle at whatever stage of the business you're at.

[51:50] Sure. I think you always want to think about three things. One is which industries you're focusing on industry and territory. Two is the size of business. Three is what are the axes of growth you want to have for your customers and so are financial, essential business enterprises or just like and these are axes in which businesses can grow as they grow into our business and those are really two things I want to think about. And the timing of which you do is very important so like when do you really want to build out like these axes where you have people grow into different business plan. Some people don't have plan different plans they just have the same plan but it's like per lead.

[52:26] You know you just pay a per lead price and so as you get more leads you pay more and then you want to kind of think about those things diligently before you jump.

[52:35] It's time for our Lightning Round. I'm going to ask you seven questions. Just try to answer them as quickly as you can. All right what's the best piece of business advice that you've ever received?

[52:47] So it would be hiring would be focus on hiring great leaders in the firm and that can promote your brand and that's all.

[52:56] What book would you recommend to our audience and why?

[53:05] Like Andy Grove books High Output Management, Only the Paranoids Survive. I mean like I like Dan Pink. Right.

[53:09] What's one attribute or characteristic in your mind of a successful entrepreneur?

[53:09] Persistence.

[53:16] What's your favorite personal productivity tool or habit?

[53:21] I like kickboxing. I go into the gym. Those things are as important and help me unwind.

[53:27] What's new a crazy business idea you'd love to pursue if you had the extra time?

[53:32] Well now everyone's talking about the blockchain but I do think the blockchain is actually very powerful. And so really cool to try to build something on that. That's it's powerful.

[53:46] What's interesting or fun fact about you that most people don't know?

[53:53] I love dancing. I've been dancing for a very long time and I enjoy it.

[53:56] And finally what is one of your most important passions outside of your work?

[54:00] Well I do like. I love playing basketball so I play a lot of basketball outside of work. And then dance, as I said before I like dancing doesn't be the main things.

[54:14] Cool, so thanks for making the time to join me today for people who don't know the backstory on this. The reason you and I have been talking for a while we've tried to schedule this interview a number of times and for various reasons we have been able to pull that off so I'm really glad that we were able to finally do this. If folks want to check out Outgrow and maybe try the product themselves they can go to outgrow.co and if they want to get in touch with you what's the best way for them to do that.

54:59 So LinkedIn is great. So my LinkedIn is just LinkedIn.com/in/RandyRayess that's R-A-Y-E-S-S. They can also email me my email is [email protected]

[55:05] Awesome. Thanks man. I am really glad we did this and I wish you and them all the best with Outgrow and I'll be following. You know what you guys are doing over the next year or two.

[55:19] Thank you. Thank you thanks for having me. It was awesome. Cheers.

55:24 All right I hope you enjoy this interview with Randy Reyes of Outgrow. You can get to the show notes for this episode by going to theSaaSpodcast.com if you need help building launching and growing your SaaS business go check out SaaS Club at saasclub.co. Registration for new members isn't open right now but you can join the wait list and I'll let you know when registration opens up again. And if you want to show your support for this show then consider leaving a review on iTunes. I love to read those reviews and it really does make a difference both in terms of the show getting discovered by more people and inspiring me to keep creating this free content for you. If you're not already in iTunes just go to thesaaspodcast.com and click the iTunes button and that will get you directly to the podcast in iTunes where you can leave a rating and review.

[56:19] So thanks for that. So next time take care.

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Omer Khan

Omer Khan is the founder of SaaS Club and the host of The SaaS Podcast. He helps entrepreneurs and companies to build, launch and grow great SaaS products & businesses. Learn more