Omer (00:11.840)
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.
This week's interview is a story of two university students who wanted to use their knowledge of machine learning to build a startup.
But they had a few major challenges.
They didn't have a business idea, they didn't know how to code, and they didn't have the money to hire a developer.
In this interview, you'll learn how they came up with the right business idea, how they were able to self fund the business, why they walked away from $1.5 million in VC funding, and how they grew their idea into a business with over 100 employees.
All right, today's guest is the co founder and CEO of Optimove, a SaaS product that uses its predictive customer modeling technology to help marketers understand customers and create personalized marketing campaigns.
The company was founded in 2009.
It initially started out as a consulting business and the co founders used the revenue from the consulting side to fund the SaaS business.
In 2012, they were offered $1.5 million in VC funding and decided to turn it down.
And they continued self funding the business until this year when they raised $20 million in their first round.
The company has over 100 employees and is based in Tel Aviv with offices in New York and London.
So today I'd like to welcome Pini Yakwel.
Pini, welcome to the show.
Pini Yakuel (02:02.600)
Thank you for having me, Omer.
It's a pleasure being here.
Omer (02:06.040)
Now, let's start by talking about Optimove.
I kind of explained to the audience a little bit about the product or the business.
But in your own words, what does Optimove do?
For sure.
Pini Yakuel (02:20.760)
So Optimove's mission is essentially to help brands to communicate with their customers in an emotionally intelligent manner.
So we want a company or a brand to talk to its customers and let those customers feel as if they're being seen, as if the brand gets them, understands them.
Kind of like to mimic the same experience you would have when you talk to a very intelligent human.
So essentially that's the overarching concept of what we try to achieve.
Omer (02:52.990)
So let's go back to kind of 2009.
How did you come up with the idea for this business?
Pini Yakuel (03:00.420)
I was working.
I was doing my master's in operations research and I met my partner.
At the time, he was doing his PhD in machine learning and we were like, yeah, you know, there's some problems we could solve together.
We had a good chemistry and we kind of like wanted to take this journey together.
We knew that we want to do tech business and from our department, which was the industrial engineering and management department at the Tel Aviv University, and we knew that the only thing that's computer science related was machine learning and data mining.
So that was the obvious kind of like route we took.
And from that point we kind of like, we knew we don't want to solve problems in the realm of inventory management, supply chain management, because these words are pretty, kind of like they don't have, they're pretty gray in terms of the way they're perceived.
There's some, some interesting problems and difficult problems in these, in these worlds, but they're pretty gray.
And we wanted to have, we wanted to go to a place which is more kind of like sassy and hyping and, you know, that has the most celebration in it.
And I think once we understood that we can do what we do in the world of marketing and customers and customers analytics.
I think this whole customer centricity revolution was also going on at the time.
Kind of like it was already going on.
So this what kind of like geared us to that direction, but we started only with that.
So we only had this kind of like direction we want to be in.
We want to utilize machine learning because this is what we know.
We don't know anything else.
We have some major skills there.
So we want to utilize that in the field of customers and customer analytics and to cater for the customer centricity revolution.
That was the only thing in the beginning.
Omer (04:41.500)
And how long did you guys kind of play around with the ideas before you kind of came up with a solid problem that you were going to go and tackle?
Right?
Pini Yakuel (04:51.180)
So absolutely, I think it was like four to six months.
The beginning.
What we did was we, you know, so, so we, we started working together and we, we started meeting with businesses, we started meeting with companies, we met with the telco company, we met with the big retailers and we're asking them some kind of like which type of, types of problems you guys are having.
How do you use data to solve these problems?
Do you utilize kind of like advanced machine learning and things like that?
And this one cellular company, they said, we have this thing that we call the Churn lab.
So this is kind of like a laboratory in which we analyze data to predict churn.
And so we met with the guys from that lab and they told us what they did and we said, hey, guess what, there's another way to do that.
And we obviously refer to our own technique that we both studied in our thesis.
And by the way, and that was how the original concept for the product, the original concept for the optimove model was born at that point.
And then we went back home, we started to sketch it and we started to kind of like formulate the basic concept.
And this is when the concept was born.
It was perfected reality proven during our work with customers and with actual data.
Omer (06:12.030)
Okay, so the idea basically kind of boiled down to let's use this predictive technology to figure out who is likely to which existing customer is likely to cancel their account or is.
Is about to do that or is not engaged.
And then how can we help to identify those people as early as possible so that the business can do something about it?
Pini Yakuel (06:39.290)
So, so, yeah, so.
So the.
It was born from this notion of.
Because that, that place, it was the Churn lab.
But this technology, and it's called the MDP Markov decision process, this technology is kind of like a meta he that is applied in many, many different fields, but nobody did it in the field of customer marketing or customer analytics.
And this is the innovate.
This is our secret sauce.
This is the innovative thing that we bring to the table.
And it's not only predicting churn, it's essentially predicting everything that happens along the customer life cycle.
So if a customer is just registered, what's the probability of them essentially becoming paying customers?
If customers are active, what's the probability of them churning?
If somebody churned, what's the probability of them coming back?
If somebody is active, what's the probability of them becoming VIPs?
So there's all these kind of like we call these customer migrations.
And the prediction is around all types of customer migrations under one type of technology.
So that was essentially the overarching concept that we started to toy around with at the beginning.
And this is what the optimal model essentially does today after many years of refinement and kind of like iterating and optimizing and tweaking it.
Omer (07:59.770)
But you guys didn't build the product at that point, did you?
Because you started out by we don't
Pini Yakuel (08:05.610)
know how, we can't code.
That was, you know, when I watched the movie about Facebook, I think it's called the Social Network, right?
Omer (08:14.570)
Yeah.
Pini Yakuel (08:14.930)
So I was like, so envious of kind of like, you know, the actor that played Mark Zuckerberg, but Zuckerberg essentially that he was able to build his own Product.
Maybe it turned out to be good because it built other types of skills that we've acquired as entrepreneurs and that I personally acquired.
So maybe it was even better, I don't know.
But at that point I was very much envious because I needed to have money to, to pay developers to build the product.
So you're right, we had no product at that point.
It was just kind of like equations and formulations and pseudocodes and things like that.
Omer (08:55.280)
And so you decided to start consulting.
Was that just a means of figuring out a way to raise some revenue?
Pini Yakuel (09:02.960)
Yes, absolutely.
So we started to.
So we met a couple of VCs because we weren't.
And we immediately figured out that's kind of like it's not for us, you know, we're not ready yet.
And I mean it's not yet.
And we just, we felt like we had time.
We felt very kind of like freed and we just said hey, you know, and meeting with people, it was got us to the initial idea.
We say, hey, let's meet companies, let's see what's their challenges, let's try to help them.
And then when we would meet companies, we would pitch our model, we would show that very same algorithmic concepts and people would say, you know what, this seems very smart.
I don't know, but I like these guys.
I like the fact that they thought about this very thoroughly.
I'll just give them my data and let's see what they can do with it.
So that was the beginning.
Kind of like got data from companies.
We promised to deliver some results, like show them interesting segments, show them interesting patterns and insights into data.
You know, find those nuggets that could help them take better decisions or even could help them run interesting customer marketing campaigns for their customers.
And that was the beginning.
And then, you know, we started meeting these companies and offering them kind of like to work with us on a retainer basis.
So they would send us their data, we would get the data, we'd get it into our office, we would start crunching it, working on it, meeting them on a weekly or bi weekly basis.
And essentially I think we kind of like became the house data scientists for these companies.
But it was outsourced.
So instead of them having their own data scientists, we would be that we would fill that function.
Omer (10:44.980)
Got it.
Okay, so I'm curious because you said your, your co founder had been learning about machine learning, right.
But was that purely come from an academic perspective?
There was no kind of hands on.
Pini Yakuel (10:58.420)
Yes, yes.
There was something that I discovered pretty quickly.
Omer (11:02.320)
Yes, I was like, oops.
Pini Yakuel (11:04.000)
Yeah, no, I mean, but, but I think, you know, I think that we both had, I walked a little bit, you know, part time in a consulting company, but we both didn't have a lot of experience and essentially we, we had a lot of passion and academic know how and you know, and then we started our journey.
Essentially.
It's a journey.
We started our journey to become what we are today.
Omer (11:31.170)
So how long did it take you to build the product then?
Pini Yakuel (11:36.210)
So what happened was at the beginning we did apply for.
So we never, we never raised money until recently, but we did got a few grants from the chief scientist in Israel and that essentially enabled us to kind of like outsource the first development project.
So we got, I think it was at the beginning something like, wasn't that much like 30,000 doll.
And we use that to pay to this development house to do the first kind of like mock up version.
It's actually the skeleton of the model and what we did, we just showed them the pseudocodes and like this is what we want this thing to do and they build it for us.
So this was the first thing, but it took time.
It took time.
I think after maybe like a year and a half or two years we started having the first versions.
But at the beginning we just kind of like explained or we just kind of like mirrored the model itself and the outputs of the model in this kind of like a website.
It wasn't yet a product.
We were still trying to understand ourselves what are the outputs and the benefits that you can get from this model.
And we used the dev people to help us mirror that out.
That was the beginning.
However, the experience with, so working with all of these businesses and customers and getting the data and seeing the data and applying our model on it also tremendously helped us to forge our identity and understand what we want to do and how we want to do it.
So when we productize our product, it wasn't like we're two coders in a room trying to imagine what people want.
We had real life experience from the consulting arm of the business.
Omer (13:19.240)
Yeah, because basically those people were your potential customers for this, this SaaS product.
When it's going to be ready.
Pini Yakuel (13:27.890)
Yeah, exactly, exactly.
Omer (13:29.850)
Okay, all right, so let's fast forward to the point where you've got the kind of the first version of the product built.
What did you guys do to start selling it?
Right.
Pini Yakuel (13:41.930)
So I think that was around 2012 that we got kind of like that.
I feel that the product was mature and I would say that that's the point where we had product market fit, and that's the point where we started to pivot away from services completely.
So you're asking how did we sell it?
Omer (14:05.090)
Yeah, I mean, did you start going to your consulting clients and get them to start using the SaaS product instead?
Pini Yakuel (14:13.890)
Absolutely, that happened.
But that's kind of like a catch 22, because in many ways these clients are already accustomed for you providing consulting and holding their hands.
So they're not going to be your power users of the product.
But it's a very good start.
And we just.
Same way we sold consulting.
I think selling is about engaging with people, listening to them, dazzling them, wowing them with your fresh ideas and concepts and your passion, and you transfer your enthusiasm over to them and hopefully they become your champions and they start to sell it internally.
Essentially, yes.
This is what happened.
And I realized about myself that I'm pretty good at selling.
I think that this is something that's super powerful for a startup.
I think that a lot of the startups that fail, you would find that nobody in the founding team is a strong salesman.
And that's a huge problem because they're going to use hired guns.
And hired guns are not good at the beginning.
They're only good once the company is proven and you have a substantial brand and then they can help you grow your business.
But the builders should be the founders and a big portion of the building is selling.
And if one of the founders cannot sell, it's a big problem.
I see it in many cases.
You see startups with like three founders.
One is techie, the other one's also techie, and guess what, the third one is also techie.
So you got three CTOs sitting, sitting in a room.
One CDO, one CTO can, can, you know, speak a bit better than the two others.
He becomes the, the CEO, and I don't know, but it's, it's, it's a problem.
Omer (16:00.700)
So being effective at sales also means anticipating the kind of objections that your potential customers are going to have about buying your product and, and being able to address those as you went out and you started having these sales conversations with people, and particularly those that weren't already consulting clients.
What were some of the objections that you were getting to them buying your product.
Pini Yakuel (16:34.100)
So you have, I think in any people in sales know this, and you can find it in any book on kind of like sales 101.
And there's a ton of objections.
You know, people would, there's kind of like a few things that happened in order for Sale to be successful.
So I think one of the earliest things that I realized myself and I was self taught in almost everything, so one of the first things you realize is it's a different discussion when the company has decided they want to do something around your field of expertise.
Expertise or when they haven't.
And you get completely different feedbacks when it's, when it's.
Situation A versus situation B, when they have decided they want to do what you do, what you are doing, or something similar to what you are doing, they would be asking very specific questions.
They're going to ask more about the practicality of how things work.
They want to gauge your ability to be their partner and to be a partner in their success.
So the whole philosophy in the way they kind of like feel you out is completely different.
Whereas when you barge in and kind of like knock on their door and you're saying, hey, I do xyz, and they're like, what is xyz?
Then you start the education process from the beginning.
You'd get a whole different set of objections.
Does this make sense?
Omer (17:59.380)
It does, yeah.
So on the one hand, you've got a group of people or prospects who you have to basically convince that they have a problem that this type of technology will solve, whereas the other group are already experiencing the problem.
They've already probably thought about potential solutions and identified what you guys are doing as one possible way to solve that.
So they're already convinced that they need to do something.
Pini Yakuel (18:25.490)
Exactly.
Omer (18:26.210)
Yeah.
Pini Yakuel (18:27.170)
I would call it, let's call it kind of like the education curve of the prospect.
Right.
So you meet many companies and when you meet that company, the company is there at a certain stage of their education curve.
They could be very advanced.
Maybe they're already doing what you do internally with kind of like an internal solution and homegrown solution.
And now they understand that there's a lot of problems with a homegrown solution.
And then you talk to peers, you talk to practitioners like you.
So they would be kind of like either digging what you do, or they would either be saying, hey, that that's not so impressive.
And then that's a whole other problem.
So this would be discussion with practitioners, this kind of like the top level of education, and then maybe you can show them that you are the next kind of like evolutionary step in that field.
That's obviously amazing because you're perceived as even more innovative than what they do today.
And then there's the beginning of the.
When people would say, I'll give You an example.
Why should I do segmentation?
What's the difference?
I just blast one email to all of my customer base that's super efficient.
It doesn't matter.
What you're saying is so expensive.
And it's gonna.
I need to build a whole team and I need to start to create different versions of my content.
And you're still kind of like pitching the story of why CRM works, why being customer centric is important, why personalization works.
If you're still pitching that story, it's a different conversation.
So I think that summarizes that.
But in terms of objections, I would say so.
You know, then there's.
There's the typical objections people sometimes feel of change, fear of technology.
You have objections that has to do with job security.
You have a ton of different objections.
But the way you handle these is I think that you just iterate and get better at every meeting, so you'll get chances.
Because guess what?
People are pretty predictive.
You know, if, if you do, if you talk about the same topic and you do the same conversation with company X, then company Z, then company Y, the same questions would start to pop up.
And then you get to practice, right?
So you, you, you answer once like this, and you see the response, you answer another time you see the response and you see what makes them.
And then you perfect it, right?
So you perfect it.
So you, you know how to handle different types of objections.
Omer (20:56.140)
Were there other competitive products around the.
At that time when you were having these conversations back in, I guess, 2012?
Pini Yakuel (21:05.820)
Yes.
I think that there's always competition.
There's always competitive products.
Sometimes your prospect can proceed.
Also, the perception of who's competitive also has to do with the prospect's education, right?
So if they're highly educated, they can understand, understand that, for example, we are not competing with an email company.
But if they're less educated, they would say, hey, I can build some segments with my email tool.
What's the difference?
Right?
So for them, the world is shallow.
It seems kind of like flat.
More flat, right?
So imagine that, you know, if you are somebody with a very sensitive palette and you're a foodie and you can appreciate the finer things in life.
And so I can, I can kind of like take you to this boutique pizza place and I'll tell you that the dough is organic and they've been kind of like fermenting the dough for this, and they use special flour imported from blah, blah, blah.
The tomatoes have been this and that, the cheese is this and that.
And then you're going to eat that pizza and you're like, oh my God, it's crazy.
But somebody else that is, he eats everything and he doesn't care.
He's like, hey man, you know, some tomato sauce and cheese.
What's the big idea?
I mean, I can do it at home with a piece of bread and, you know, tomato sauce from a can and it tastes the same.
And I think that has to do because everything in life could be very similar, but could also be extremely different.
It depends on your perception and mindset and level of education, I would say.
Omer (22:41.470)
I'm curious whether the, the kind of the predictive technology was kind of baked into the product by then and that's what you were using to, to differentiate your product from.
Pini Yakuel (22:54.680)
Absolutely.
Sorry, go ahead.
Omer (22:57.400)
Yeah, so, and, and you.
And, and that was part of the, the $30,000 that you'd invested in, in hiring somebody or outsourcing that development work to do this or did that happen with further development and over kind of subsequent year or two.
Pini Yakuel (23:13.330)
Yeah, yeah.
So by the time we released the first version of the product, I think it was like 2012 and then beginning of 2012 and then by then we've taken the code from this external company and we've hired our VPRND and he had a bunch of coders.
So we were able to get some money from the consulting business and invest it and build a team of like 3, 4 developers worth for like a year to perfect the product and get it to that state.
So that definitely happened.
But you're absolutely right.
I think until today, by the way, the reason optimove part, you know, some of the reasons that we're able to be more successful in other companies is I think that people understand that what we do is more unique and it puts us in more like a blue ocean.
It allows us to get better pricing.
Will not be.
I mean we do have competitors, but will not commodity.
So when somebody, if somebody mentions a competitor, I would say, you know what, it's close, it's in the same field.
But go see their product, see our product, and then you'll tell me what the difference is.
Because then, I mean, the system speaks for itself.
You see the depth of the science and the scientific approach, especially in today's world.
Right.
If you go to websites of companies, it all feels the same.
Everybody's, especially marketing people, they're very quick to adjust their message.
And if they understand the word predictive or the word multi channel or the word, you know, art versus science or combining art and science, the Second that they get it, they're all going to put it on their websites.
But then the question is, what is science?
If I multiply two numbers, one against the other, is that science or is that second grade algebra?
So and you know, marketers can say whatever they want.
They can say it's science, nobody's going to penalize them.
It's not the Supreme Court, it's marketing and it's a capitalistic market.
You can say what you want.
But yes, I think a very co identity around the predictive model.
And later we've added the automation piece that runs marketing communications on top of that, you know, on top of based on the insights that the model generates.
That connection between the predictive model and the marketing automation piece is what made us very, very unique.
And even our approach to running marketing campaigns is highly scientific.
It's very much influenced by the model.
So it all comes together as like a well rounded character of products.
Omer (25:52.960)
And then there were some interesting things that happened.
From what I understand around 2012 you had an offer from a VC for $1.5 million, but you turned that down.
So let's kind of start by there.
I want to kind of understand like how did that come about?
Because I think you still had sort of, you were fairly early stage, you had a minimum viable product at the time.
So how did you get to the point where a VC was interested in investing that kind of money with you?
Pini Yakuel (26:25.610)
Yeah, so listen, generally speaking I don't live in a bubble and despite the fact that we were bootstrapping, we were constantly meeting with VCs from time to time.
Sometimes it's a mutually beneficial way both for VCs to get on top of what's going on in the market.
So they want to meet me as somebody that's kind of like innovating in the space of CRM and marketing automation.
And I want to meet them also to learn about the market trends.
I have to say that because I was very kind of like this is my first job, still is my first job.
So I was fortunate enough to also learn from them.
They would say, hey listen, everybody's doing SaaS now.
That's the trend, this is why.
Or they say something else.
So they'll give you the standard way recipes of how people are building companies.
Now the question is whether these recipes fit you or not.
It's a question for you as an entrepreneur to take.
So I would, I would, I would take the basics sometimes from them.
I think a lot of their recipes are wrong and it's a problem for people to use these recipes because it doesn't work for any company and it's just kind of like a raw average of what companies are doing and that's dangerous to use these recipes as is.
So I've been always meeting with VCs and I saw some value in it.
Omer (27:50.830)
Were you meeting with them to pitch the business for funding or were you meeting with them to get feedback?
Pini Yakuel (27:58.590)
Yeah, so it's a kind of, it's a kind of like, you know, it's a kind of a meeting where, you know, you play kind of like you're, you're being more distant, you're saying, hey, listen guys, I'm, I'm bootstrapping the business.
I'm profitable, I don't need the money right now, but I'm happy to explore opportunities.
So that's kind of like the way you start.
That's how I.
Because it was true.
It was also true.
I wasn't, I wasn't, I never met the vcs.
When I'm like, oh guys, I'm dying, there's six months left, my burn rates, please save me.
I mean, it was never the case like that.
So, so I was always ahead.
I had the, you know, the privilege of meeting them and, you know, talking as a grown up from a point of strength.
And they would be asking some questions like, how would you know that people would give you their data?
Right, because you take so much data and it's sensitive data and you want to put it in the cloud.
How do we have certainty in the fact that people are going to give you the data?
And I was like, I don't know, I mean, I mean the cloud revolution, I guess everybody's doing that, it's gonna go there.
And it did go there, but, but they didn't have, you know, when they're not excited enough, they will come up with the, you know, the, the analytic side of their brain would start to, to walk over time and they're gonna, they're gonna make all these questions and, and, but when they're excited about the story, the analytic part of the brain shuts down and they're just excited and they, they explain to themselves why it's a amazing.
So I think, and some people get it wrong and they think that they would be very analytical all the way through.
And I don't think that's always the case.
But.
So this was the situation we always met with VCs, and I think the more mature you get and I was never kind of like, because I never needed the money.
Before I was.
So if they said, hey, we're not sure this and that will happen, I was like, okay, it's all good.
You know, I'm just here for a meeting.
No need, everything's great.
But when we got more and more mature and they're like, how would we know?
And I said, because I have 10 clients doing that.
How would we know that people are going to buy from you remotely, right.
Without over the phone, over the web?
Because I have a few people doing that here.
It's proven.
Talk to them.
So once, once you, you kind of like overcome all these hurdles and it's slow, it's no longer a hypothetical question.
It's a place proven thing.
You get all of these hurdles and then, and then they get, they get more and more excited.
And of course there's a lot of people selling dreams and that's fine.
And it's a part of the VC job to buy a dream and to invest in something that could be great, but it's not proven yet.
And that's.
I was never in that situation because I was never.
Also I wasn't sure I wanted it.
So I was kind of like being standoffish in these types of conversations.
Omer (30:51.290)
So that was a great place to be because not only did it probably put you in a better mindset to have those conversations with those people, but if potentially you did want to start negotiating, it put you in a, in a, in a stronger position to, to negotiate with them.
Pini Yakuel (31:10.890)
Absolutely.
I mean, and even, and even when I, when I closed like the last round, I was always in a strong position.
I was always be.
I was always, I was always fortunate enough to say, listen, guys, if it doesn't work, we don't have to do this.
And I did it from, from a place of strength.
And so, yeah, I think that's, that's.
Listen, not every business can do it right.
If you're in, you know, if you need to build a new storage device and you need to buy equipment and you know, or if you're developing a drug or a revolutionary medicine, you're not able to do it without funding because you have to get it from day one.
You're not able to sell services.
But since our business, eventually SaaS business, you need laptops and people to pay them salaries, and that's it.
It's more nimble in that sense.
And you can generate revenue and progress like that.
Omer (32:04.040)
So why did you turn down the $1.5 million offer?
Pini Yakuel (32:09.400)
So I've always been kind of like going through this love, hate relationship with VCs.
Okay, on one side, the Planet tells you that this is what you need to do because the minute you start doing well, every week you get two or three emails from this junior analyst VCs.
They start the email by saying, hey, I'm Chris from this and that fund.
And we are a 7.5 billion fund.
We na na, na, na na.
We're super excited about your story.
We're impressed by your growth.
Let's talk.
And you get these emails every week and you read stories because the media loves it, right?
The media loves to cover stories about funding and money because you can say, this company just raised this and that, so it's always more yellow in a sense, and it's easier to report about.
However, I think this is kind of like the pressure, like the Planet tells you that this is how we should build a company.
And you're being pressured by everybody around you to get funding.
And you're also being pressured by yourself.
Because at the end of the day, running a business is a very lonely exercise.
You're there on your own.
And not only that, you're there on your own.
You're not sure if that thing is even real, right?
So you have a real kind of like identity crisis and issues because you know, you have some customers, but you might not be profitable or you may be working with a sub segment of customers and maybe that's not going to work with other people.
And you're always kind of like feeling on the edge and you're aching for validation.
You're aching for somebody to tell you the way to get validation.
Obviously, you can wait a few years and mature and fold your identity and become some successful company and say, that's it.
We are the thing.
We are for real.
It's a real business.
We're no longer a startup.
It's an actual business that generates money and it's profitable and, and you.
But that's a very agonizing journey.
And I think most entrepreneurs, especially younger ones, you just want the VC to save you.
You want to, hey, can somebody please give me some money and tell me that I'm real?
Or at least that they think that I might be real.
And I can show my mother and my grandmother and I can send the article of the press release of me raising money and they can say, hey, you're a good boy.
I always knew something's going to turn out of you.
So I think that is so true.
And this is essentially the innate fear of every Entrepreneur and the VCs, they can cater for that because they give you validation and legitimacy, they pat your shoulder and they say, listen, you're not hallucinating what you're doing could be good and you would love to get it.
So however, however, I think if your company is not born with VCs, and this was my case because I was bootstrapping from day one, at a certain point you have a real thing.
And let's say we talked about the company kind of like forging its identity and growing up to just like a teenager, let's say at certain point your company is like a 10 year old child.
It has a personality, it has its characteristics, it talks, it's funny, it's cute.
Well, maybe it's going to be the President of the United States and maybe it's going to be, you know, a nice plumber.
Right?
But you don't know at that point.
And sure, at this point you're already emotionally attached to your company.
You're already kind of like the company is your baby.
Just like a lot of people say, right, it's my baby.
That's very much true.
Emotionally speaking, that's the way you feel.
And you're the parent of that company and you know that if you, if, if you're gonna vcs, they, they don't care.
They, they see it as a very cold, calculated business.
What they want to do is to take this 10 year old child and inject money, or let's say steroids into that child.
And they want to see muscle tone being built up and they want to see it quite quickly.
If that doesn't work and it dies off, they don't care, they move on to the next one.
That's, that's the way the, the mechanics of their business work.
Omer (36:25.050)
I mean, they expect most of their investments to fail anyway.
Pini Yakuel (36:27.850)
Right?
And they say, exactly.
We'll infuse steroids into like a bunch of tiny old kids and one of them would have the DNA to, to become a giant.
And that's amazing.
And then we're going to talk about this giant all over the press and everybody's happy because, because that's the model.
Whereas for the entrepreneurs of the other nine companies where their baby has just been killed, it's a problem.
You know, you feel maybe it's too early, maybe it's not the right time.
And I always felt that I would be in a situation of constant conflict in terms of velocity.
They would kind of like pressure me to do things sooner, to do pre hires, to do pre things.
I was very much scared about what's going to happen to the culture of the company, what it's going to do to me.
Maybe I was not ready as an entrepreneur.
I was not savvy enough, I was not skillful enough.
Today, you know, I'm battle trained.
I mean, I know the market better than my vc.
I know the, I mean, I've been there, done that.
I've seen a lot of things.
I'm older now, so I can.
And the company is older now, the company is mature, all the pieces are in the right places.
We've proven a lot of things.
And now.
And you know what?
We're not working with a VC now.
We're working with a growth fund.
So we have kind of like skipped the VC stage and now we walk with a growth fund.
You know, in a growth fund, they're looking for a real business.
They're looking for good multipliers, but they're not looking for the company is real.
They're not investing in crazy dreams.
They're investing in real businesses that have a strong growth potential, which is something that I think we have.
And all of a sudden I found myself aligned with these growth partners, you know, and they have the same philosophy.
And I said, yeah, you know, this is something that I could do.
The company is ready, now is the good time.
But it's only seven years after the.
Almost eight years after we started.
Omer (38:26.790)
It's funny you say only seven or eight years after.
I think for a lot of people they'd be feeling like, you know, why didn't I do that in year one?
And if I didn't achieve that in the first year, I must be doing something wrong, right?
Pini Yakuel (38:41.910)
Achieve what?
Omer (38:42.950)
I mean, in terms of raising, raising money or getting to the point where you can have those types of conversations.
And you talked a little bit more about that earlier when you, when you talked about the velocity of the business that you guys, you know, I think you'd spend probably, what, two or three years from the point where you decided you wanted to build something until you actually had a right, a working product that you could go out and sell to customers.
So you kind of never struck me as the kind of guys that were kind of like, we're going to build this product, we're going to go in IPO and we're going to kind of sell and become kind of successful in the next 18 months.
You seem to always be thinking about the long, the long term view of this.
Yeah, yeah.
Pini Yakuel (39:31.130)
Statistically speaking, that would be a foolish notion, right?
It happens to some companies.
Listen, if you're in A position that I think.
I think entrepreneurs that, you know, happen to stumble upon something very big or aim to go something very big, and it does work.
They feel it, and then it's.
It makes perfect sense for them to accelerate and to press the gas pedal as hard as they can.
However, I just, you know, I just think that every company has its own story, and you need to adapt your parenting or your leadership of that company accordingly.
And yes, I do think that, you know, patience is the name of the game, right?
It's not just a cliche, it's true.
I mean, even, you know, hunters in nature.
I'm a big nature buff, by the way.
So, you know, a lion, you know, she would get.
She would get a hit one in every five tries.
So it's 20%.
And this is one of the best hunters in nature.
So.
So, you know, 80% of the time, she fails.
And sometimes she sits and waits for four hours, you know, in the bushes or something.
So.
So, you know, patience, stamina.
However, I would say that what I did take from the VCs and from the discussions with them, I did grew as hard as I could organically.
So I'll give you an example.
I never took out dividends.
I always underpaid myself, and I've always invested a ton of money back into the business, and I did that ferociously and as fast as I could.
So the minute I sniffed that there was a place that we are ready, like, if I thought that our marketing team is ready for something, then I did it super fast.
Then I did it like crazy aggressively.
So we were able to grow like 100% a year over year, most of our time as a business, because we grew organically.
But when we felt something is right, we were very much aggressive on it.
So I think if the audience shouldn't be.
Get a notion, an erroneous.
Erroneous notion that.
That says that.
Yeah, just take it step by step, slowly, you know, you'll get there.
No, you should be competitive.
You should be aggressive.
You should be, you know, tactful.
And if you.
If you.
If something.
If you.
If you feel that something is right, you know, execute on it, you know, with the highest quality and the highest speed you can, because speed does count.
However, don't be in a situation that you.
That you're doing things that you're taking a lot of bets, like, hey, I don't know what's going on, but I have a lot of money.
I just try to hire this guy, this guy, that guy, and see what works.
This I don't like, but, but I think something that I did learn from the VCs is this notion that essentially growth is king.
So to get it, to get a successful company and to get traction from the market, to get traction from your employees, from your customers, that everybody is kind of like, you know, bowing down to this old God of growth.
This is the God of the capitalist world.
Right.
You can make a lot more revenue as a company, but if you don't grow fast, the market's gonna penalize you.
Right.
The market's not gonna give you a high valuation if you look at the stock market.
So I got it, I got it from the early beginnings, but I just invested the money in a smart manner organically where I thought was the best places in the bottlenecks of the company to unlock growth.
So we did it in a more, in a more kind of like paceful manner.
It was paced steadily and surely, but it was still pretty aggressive.
So with what we could do.
Right.
So I just wanted to clarify that.
Omer (43:20.820)
Yeah, thanks for that.
I'm curious about one thing.
You studied industrial engineering at university.
You're in a company which is very data driven in what it does.
Yet from when I looked at kind of how you made the decision about whether you were going to take the $1.5 million in VC funding or the 20 million that you just raised from the growth fund, while we talk about it, you're able to kind of explain the thinking process and it sounds very logical and rational in terms of, you know, kind of the why you made that decision.
But from what I understand at the time those decisions were made from the gut, there was a lot of this doesn't feel right.
This gives me a sinking feeling.
This doesn't give me a sinking.
This makes me feel good.
And a lot of times, you know, listening to the gut and, or your intuition is sometimes considered very, kind of like, you know, is like some new age stuff.
Right.
Or, or especially if you're in a, in an environment which is sort of very data driven.
So is, is that a kind of a good reflection of, of just generally how you make decisions?
Pini Yakuel (44:40.140)
Absolutely, absolutely.
I think that, I mean you're, you're hitting the nail right on the head in terms of like, I think it's a true, you know, modern life dilemma because today we do have a lot of data.
And then people would get, you know, they would try to make more and more of their decisions to be data driven.
I think that you should, people should be very much data informed and data driven in Terms of like there's many things like you can't manage what you can't measure.
And I'm a big believer in that.
I think that if you reflect the true situation of a business with data, that's also great because what data allows a big company to do is you get rid of the myths and the drama.
I'll give an example.
Somebody goes into your room, an employee, and he's like, you know what happened last night?
We had this issue in the support team and there was this failure and the guy's super dramatic and he's talking about for an hour and he's going across the company and telling this story.
And this story happened once in three years.
It doesn't reflect anything and it's not a real problem.
It's just something that happened, you know, it was a fluke or misfortune event.
And so.
But if you, but if you show the data and you say yes, but our Service level is 99.9% and it still is and the trend is not changing, then everybody shuts up, you know, everybody shuts down because there's no room for drama anymore.
The numbers and the data gives us a way to see reality as it truly is.
However, so this is, I think, the way you should use data.
What you should not do is look for every type of answer in data.
Because still most of our lives and our realities, both as, both as managers and as people, is not digitalized.
And we do suffer from, from a tremendous deficiency of data.
Because of this deficiency, the our human brain and our ability to perceive multi data from multiple dimensions.
If you talk to somebody and you just hear their intuition in the way they speak, if you, if you have a true sense of your identity and your story as a company, you know not to do something and I don't care if somebody shows me a research that, you know, Harvard Business School is saying that the next big thing is this and that if it's not in my company's identity or what we.
So we should not pursue it because it's not in our DNA.
And even if we try to, we're probably going to fail because we don't have the passion or the talent in house to do that.
So I think that what makes us amazing at deciphering different situations as human beings, and you can call it intuition, gut, whatever you want, want, but it's also a data driven process just run by your brain and it's based on different types of dimensions in the data.
Some of it will be qualitative, some of it would be quantitative.
Sometimes you're gonna rely on gossip.
You're going to rely on something that a person you trust told you you're going to rely on.
On a study you read.
You're going.
So we accumulate tons of bits and bytes of information.
We have our own experience and things that we saw happen and work and don't work in the past.
And based on that we have this, this, this feeling that something would work or would not work.
Something suits us or doesn't suit us.
Something is, is.
And, and I think this is the best way to, to grow a business even, even in, in modern reality where we do have so much data around us.
Omer (48:24.150)
That's a really interesting way to think about it.
I never even thought of it that way.
Pini Yakuel (48:28.790)
That
Omer (48:30.950)
you know, as you said a lot of the times, your brain already has a lot of this data.
And when you're in those situations where you need to make a decision, maybe your brain is kind of making these calculations at light speed and the output of that is a feeling.
Right.
This feels good, this feels bad.
Pini Yakuel (48:50.310)
Feels.
Omer (48:51.050)
And exactly.
Pini Yakuel (48:51.810)
You're exactly right.
And there's, by the way, there's a lot of studies about that.
There are things that happen in, in kind of like your cortex and your conscience, but there's a lot of things happening in your, I think it was the cerebral brain, but essentially, yes, let's not forget our brain is, is probably the most advanced computer ever kind of like seen in, on this planet.
And, and yes, it's absolutely happening like that.
And we remember things and we have emotional, emotional memory.
And sometimes it could also lead us to bad places.
Right.
Sometimes it could take you to.
You know, this is why some people do it better than others.
Omer (49:27.310)
Yeah.
Yeah.
I think it's that, it's the, it's a skill in terms of learning those feelings, the gut, in the gut kind of feelings that you get and knowing when you're getting a good signal that kind of is going to help you make the right decision versus when you need to still kind of go and maybe back that up or get additional data or whatever it is you need to make that decision.
It's a fascinating topic and I'm sure it's something we could talk about for hours, for sure.
I want to get onto our lightning round, so I'm going to ask you a series of questions.
Just try and answer them as quickly as you can.
You ready?
Pini Yakuel (50:08.220)
Beautiful.
Yes.
Omer (50:09.700)
What's the best piece of business advice that you've ever received?
Pini Yakuel (50:13.830)
So in one of the books I had in my first degree, the title was learn by Doing.
So I think that that's.
That's the best.
This is something that I've been following and learned by doing some just, you know, if you want to get something done, roll up your sleeves, start to kind of like get real feedback from real customers, real people, you know, fall down, get up, iterate, improve, constant improvement, Kaizen, all of those things.
I think, I think life would give you always a ton of, kind of like a ton of opportunities to change and improve.
You just need to see that and do it.
Omer (50:49.440)
What's one attribute or characteristic in your mind of a successful entrepreneur not having a plan B?
I think I heard Will Smith talk about that once.
That's a good one.
What's your favorite personal productivity tool or habit?
Pini Yakuel (51:08.530)
So one habit I have is if something takes.
I think it's from one of the books, Getting Things Done.
So if something takes less than two minutes, I do it now, even if it intercepts me in the middle of something else.
And another thing I do is I try to combine many tasks together, the ones that are related, and treat them as a kit.
So if you need to do something that's comprised of three things, do them.
Don't break them down.
So if you do one, then let the other two wait for the next day or the next day.
It's a big problem.
I just try to everything.
So I have one email, another email telling this guy, another email, another.
So I'll do four or five tasks together, all related to one kind of like meta task.
That makes sense.
Omer (51:45.230)
Yeah, totally.
What's a new or crazy business idea you'd love to pursue if you had the extra time?
Pini Yakuel (51:52.310)
So there's a lot of things I want to do in still in Octiw.
But a crazy idea is kind of like opening up a restaurant that serves very simple food.
Like, you know, a bowl of cereal with milk, a simple, you know, toast with cheese, and like, like food you do for kids.
Super, super simple and just a fun place with no fancy herbs and.
And Brussels sprouts with.
With the.
God knows.
Omer (52:20.320)
Yeah.
You know, seriously, I would, I would pay to go to a place like that every week.
Pini Yakuel (52:26.240)
I just want to sit there and say, hey, there's a.
A simple pastrami sandwich with just bread and mayonnaise.
Omer (52:31.740)
There you go.
Yeah, that's all you need.
What's an interesting or fun fact about you that most people don't know?
Pini Yakuel (52:39.620)
So I'm married to an actress and I have a lot of kind of like artist friends
Omer (52:45.860)
and finally, what is one of your most important passions outside of your work?
Pini Yakuel (52:50.420)
So I'm a big nature buff.
I like to watch, you know, a lot of types of National Geographic, and I learned a lot from that, you know, in terms of strategy and life and just, you know, internal wisdom.
Omer (53:07.380)
I love that too.
I've been watching a lot of those, the BBC Planet Earth shows lately.
Pini Yakuel (53:13.260)
Amazing.
Omer (53:13.780)
Love that stuff.
Pini Yakuel (53:14.540)
Yeah, yeah, amazing.
Omer (53:16.020)
Cool.
Minnie, thank you for joining me.
It's been a pleasure.
I really enjoyed having this conversation with you.
If folks want to find out more about Optimove, they can go to Optimove.com and if they want to get in touch with you, what's the best way for them to do that?
Pini Yakuel (53:32.460)
So just like, you know, go to my LinkedIn page, you know, ask me to be your friend, I approve everybody.
And then you have my email and you can contact me.
Omer (53:42.460)
Sweet.
Pini Yakuel (53:43.580)
Beautiful.
Omer (53:44.220)
Awesome.
Listen, it's been a pleasure.
I appreciate the time you made and for sharing your.
Your experiences and insights.
And I wish you all the best with optimove.
And to your next big milestone, whatever that is.
Pini Yakuel (53:57.980)
Thank you so much.
We're gonna need it.
Omer (54:00.780)
Cheers.
Pini Yakuel (54:01.500)
Cheers, mate.
Bye bye.
