A Product Market Fit Show | Startup Podcast for Founders
00:12:07 · Arvind Jain, Pablo Srugo
[00:12:07] S0: That's a great question. Sometimes we talk to our team about it. We didn't do any TAM analysis. How do you do TAM? There's no product in the market. Nobody actually is even solving this problem. You had to really – basically my mindset was that this is fundamental. Initially, when people are – investors ask me, okay, what's the TAM or how big is this opportunity? How would you even figure out how much people would pay for it? What should be the price and what's the ROI? How are you going to prove the ROI? You won't be able to prove the ROI because saving time is so nebulous. My question to them would be always that, okay, think about email. Do you think you need email in your company? Nobody doubts it. I said, what's the ROI of it? Nobody can come up with the ROI either. [00:13:00] S1: Slack was a great one like that. I remember when it came out, we were paying, we were a startup paying for Slack, and our CFO was like, you guys really need to pay for this? I'm like, yes, do not take this out.
00:13:00 · Pablo Srugo, Arvind Jain
[00:13:00] S1: Slack was a great one like that. I remember when it came out, we were paying, we were a startup paying for Slack, and our CFO was like, you guys really need to pay for this? I'm like, yes, do not take this out. [00:13:10] S0: Some things are fundamental and we felt that search is like that. Look, you're trying to find things and to get work done. It's important. Then especially in this new world where knowledge is exploding, every year you double your knowledge inside your company and you spread that knowledge across 30% more systems at 300 different places. Enterprises have thousands of applications and all your knowledge is spread across all those places. How are you going to find anything? Just like on the internet, think about the internet. Are you keeping track of like, hey, if I'm looking for a recipe, I'm going to go to this place. If I want to look for news on certain topic, I'm going to go there. You don't do that. It's not possible anymore because there's so much information. It's across so many different places. [00:13:58] S1: You got now this core group of engineers. You have the funding. You need to build the product. Do you just go heads down and build or do you partner with some design partners to figure out the subtleties of it? How do you make that MVP work out?
00:13:58 · Pablo Srugo, Arvind Jain
[00:13:58] S1: You got now this core group of engineers. You have the funding. You need to build the product. Do you just go heads down and build or do you partner with some design partners to figure out the subtleties of it? How do you make that MVP work out? [00:14:11] S0: You absolutely have to have people. There's no way to build a product, especially like this one, without any design partners. That was the first task. As we started to think about technology, I was, although I'm an engineer, but I had all, any non-engineering task, whether it's ordering coffee for the office or figuring out design partners, those are my tasks. Actually, it's very interesting. I followed a very different process than typical. I didn't actually go and hit my friends and say that, hey, can you actually take this product and give me feedback because I felt they'll all be very nice to me and they will do it. Even if they don't have a need. I actually went on LinkedIn and I would actually do call outreach to people, and I would like, look, I'm building a product this. Do you have this problem? If you have this problem, I would love to talk to you and get your feedback so that I can build my product with direction from you. That was the journey that we went through. Did a lot of – [00:15:13] S1: Do you remember the specifics of that? I'm curious. Did you have to send 100 of these to get 10? Do you remember how high level, how much volume you need to go through?
00:15:13 · Pablo Srugo, Arvind Jain
[00:15:13] S1: Do you remember the specifics of that? I'm curious. Did you have to send 100 of these to get 10? Do you remember how high level, how much volume you need to go through? [00:15:21] S0: Yeah, I had to do a lot. I don't think I was getting one out of ten responses. Maybe I was initially, but then I was the BDR for my company for the first two years. The response rates would be low. I've sent thousands of outreaches. I'm looking for – and I understand everybody's busy, but when you get the response, that's from a person who has that pain because they're responding to somebody who they don't know, right? Somebody who has no brand in terms of nobody knew about our company, but so that means the problem must mean something. The problem is an acute pain for them because that's when they're responding. [00:16:02] S1: To be clear, your message wasn’t, hey, I'm building this thing. Do you want to buy it? It was very much, you might have this problem, let me ask you a few questions. That’s how you framed it in the early days. [00:16:13] S0: Yeah, it was never about selling. Those outreaches were never about selling because in fact, we actually were not selling the product. We had no pricing. We had no plans to make revenue. That was an intentional decision we made that we would actually not even charge for our product for the first two years.
00:16:13 · Arvind Jain, Pablo Srugo
[00:16:13] S0: Yeah, it was never about selling. Those outreaches were never about selling because in fact, we actually were not selling the product. We had no pricing. We had no plans to make revenue. That was an intentional decision we made that we would actually not even charge for our product for the first two years. [00:16:26] S1: I'm curious. In those two years, how did you structure the team? Because you can easily, given the funding you had, I mean, you could build a very big team or you could keep it small, five to ten. I'm just curious how you structured it. [00:16:38] S0: We got the team to about 20 people. That was our goal, which is large. Sometimes for companies you don't start that way, but we knew that this is a difficult problem. Search requires a lot of R&D, lots of technology to be built. We wanted to build a team of about 20 people and divide it into three different areas part of our technology stack. We felt that that was basically a good team to actually make a lot of progress and build a great product. Then we stayed there. It was like I would say we got to about ten people within the first five months. Then gradually we got to 20 over the next five months. By the end of the first year, we were more than 20. Then we stayed out there for some time. There was a sufficient strength that we had in our engineering team to keep making a lot of progress.
00:16:38 · Arvind Jain, Pablo Srugo
[00:16:38] S0: We got the team to about 20 people. That was our goal, which is large. Sometimes for companies you don't start that way, but we knew that this is a difficult problem. Search requires a lot of R&D, lots of technology to be built. We wanted to build a team of about 20 people and divide it into three different areas part of our technology stack. We felt that that was basically a good team to actually make a lot of progress and build a great product. Then we stayed there. It was like I would say we got to about ten people within the first five months. Then gradually we got to 20 over the next five months. By the end of the first year, we were more than 20. Then we stayed out there for some time. There was a sufficient strength that we had in our engineering team to keep making a lot of progress. [00:17:28] S1: You mentioned taking a different approach. I mean, I can see it because if you go for two years building a product without necessarily charging for it, you're certainly not following the Eric Ries Lean Startup, fast iteration, MVP approach. Why not? Why didn't you just build the MVP, the lowest thing that somebody would pay for, put it out and just do what most startups tend to do?