A Product Market Fit Show | Startup Podcast for Founders
00:27:34 · Pablo Srugo, Ben Rudolph
[00:27:34] S2: What did you learn? Ultimately, what was the go to market that started to actually work for you guys? [00:27:38] S0: Yeah, the go to market that actually started to work for us was one, simplifying down the message we were, what we were trying to sell. I think Peregrine is a complex piece of technology. It could be hard for maybe a person not familiar with technology to explain that value prop. So it was really important for us to make the value prop of Peregrine very clear and have our champions kind of go to bat for us. And the way we got scale is by hiring account executives, you know, across the country and teaching them. And it was card carrying, knocking on doors and doing this at scale and building the pipeline, going through the nine to twelve months sales cycle and doing that enough times over and over and over again. And these things get easier as you do more of it, because as we've generated penetration within certain areas. The next customer is that much easier. That state is more familiar with you, that city is more familiar with you, and so they have a snowball effect, but. [00:28:39] S2: How fast did things ramp? How fast did you get to a million and then $10 million, for example, in ARR? [00:28:43] S0: Yeah, we went basically one, three, ten. [00:28:47] S2: Yeah, I mean that's the kind of classic, used to be the classic, right? Triple, triple, triple, double, double. Now it's one to a hundred in a year. [00:28:53] S0: It took a lot. It took a lot and there was not an easy button question.
00:28:53 · Ben Rudolph, Pablo Srugo
[00:28:53] S0: It took a lot. It took a lot and there was not an easy button question. [00:28:57] S2: Well that was going to be my question, right? It's like, did it ever, easy is the wrong word because nothing's ever easy. You know, even the startups that are high flying, like revenues, it's not easy. I'm sure if you go and talk to somebody at Anthropic, it's not easy. Even though all the revenue is coming in. So easy is the wrong word, but when did it go from a push to a pull? Where did it go from where, at least the growth, the top line, was not the number one, most principal worry? It was other things. And was there ever, like, did that ever kind of start a shift or was it always, okay, how are we going to make it this quarter? How are we going to make it this quarter? Was that just the real life?
00:29:27 · Ben Rudolph
[00:29:27] S0: Look, I think the reality is Peregrine's goals are always very ambitious, and so it's always top of mind. How do we expand? How do we build? And how do we grow? And what we did last year, by definition, we have to do something new and different. And we have to either build the fleet out more, we have to train the regional sales manager, train the account executives underneath it. Now, I will say we're at a point where we have an engine in the state and local space. It can always be better. We always want to grow faster. We're now expanding to different types of verticals. That takes a whole different type of learning. Our whole idea of Peregrine is deeply understand a vertical, so that you can be successful in it and then when we are expanding to emergency operations or expanding to health and human services. We also have to go and do the hard work of learning that vertical, and learning the way we go to market because it's different. It's very difficult to just kind of copy and paste. Of course, you can take some of those learnings, but you got to do the learning.
00:30:22 · Pablo Srugo
[00:30:22] S2: But it's always been, the challenge has always been, like you've never been in a position, just to be clear. Where it's like, wow, we have so much pipeline, whether it's outbound or inbound generated. We have so many contracts closing. How are we even going to deliver on this, right? Which is typically the classic quote unquote product market fit that you read about or whatever. That market trees would talk about. Like was that ever the situation, or was it always okay how, okay we're going to triple again therefore, da, da, da and you do. Like most startups that I see, at least, like they live in that. Frankly, whether they say they have problems or not, they live in that world where it's like, OK, shit, how are we going to make this quarter? How are we going to make next quarter? And like, well, if we do this and we do that, maybe we'll make. We're off by twenty percent and then the one in ten are the ones where it's like, yeah, I'm not worried about making the score. I'm worried about maybe retention. I'm worried maybe about like hiring. I'm worried about, raising money cause whatever. I'm worried about all the other things, but not growth. So I'm curious, obviously at the beginning, it's never like that but did that ever happen?
00:31:15 · Ben Rudolph, Pablo Srugo
[00:31:15] S0: Yes, I specifically remember the next bottleneck for Peregrine was that deployment motion that you talked about, like, how did you scale that? When we started getting, you know, not like single digit customers, but dozens and dozens? And then it was like, oh man, how does this even work at scale? And I think that was a big moment for us. I would say the year of 2023, is. [00:31:15] S2: You're now in the tens of millions, right? At that point, could you point to something? There's probably no good answer to this question. I'll ask it anyways. What took you from more of a push, hey, we're doing numbers, we're doing great, one, three, ten. That's awesome, to like, wow, we're growing so fast. I've got these other problems? And I'm asking it, you know, just for my client. That to me is that, you know, we talked earlier about the product market fit moment. Which is really like a value delivery moment, right? The first time it was an action, you solve the cold case, like, okay, this thing works. That's not necessarily the same as there is so much demand for this. I'm drowning in demand, which is kind of what you're talking about in the 2020s, and I'm curious if that's just a matter of, well, at some point you sell enough. People know you, like you said, commanders, tell the commanders, captains, and word of mouth takes you there, or if something changed, either in a product or the market. That all of a sudden demand just kind of took a step change.
00:32:27 · Ben Rudolph, Pablo Srugo
[00:32:27] S0: That demand, it's a mix of all of those and the moment that I really felt that we needed to teach it is, we were operating off of a spreadsheet for resourcing and how, who goes where. And, we just had this big list of customers and we had this small list of deployment folks. And they were all tied up in current customers. And we feel very strongly that like, as soon as the contract is signed, we got to start work on this. We got to start integrating data, we got to start providing the value and we were taking engineers off the line and doing core product work to be able to do these far deployed motions. And that is when we were really testing the scale of how we could develop that playbook to make it more efficient. How we could hire rapidly to be able to meet the demand. [00:33:10] S2: And is that also when, just looking at your fundraise history. Would you say that that was also when fundraising really took off? Now you're raising massive rounds and I'm sure it's probably not hard for you to raise. I mean, you want to optimize and all these sort of things but I'm sure you've got more demand than supply in terms of fundraising. And obviously it wasn't the case when you're raising a million dollars. Was this around the time when that changed as well? Is that correlated? [00:33:31] S0: Yeah, absolutely. I think whenever you can show that kind of snowball of growth year over year, month over month, quarter over quarter. At a certain point, the business is starting to be judged on its metrics and when you can show those, that's when it becomes.