NZ Business Podcast - Paul Spain
00:21:31 · Jamie Beaton
[00:21:31] S0: So I guess the good thing is we've always had a pretty meritocratic culture in the sense that we really focus on performance, delivering results, etcetera. So when I was going through this process, a key thing was discovering that the outcomes were not were not there. Once we discovered those outcomes, you know, it was pretty easy relatively to have, you know, transparent conversations with those leaders, and then, you know, mutually agree it wasn't working, and then, you know, evolve and fix the teams. But as far as figuring out the outcomes weren't working, you know, in digital marketing, it's really interesting. So it sounds like an easy problem to solve. You know, if you spend money on Facebook or Instagram, etcetera, how do you track end to end whether that is actually converting? And it sounds pretty simple, and everyone's pumping money into these different online platforms. But, actually, the complexity of tracking things across, you know, Eventbrite, different landing pages, you know, websites with, you know, various tracking codes, you know, it's it's pretty complicated. And so for a while, you may... You can't attribute necessarily your marketing spend to what's happening on the revenue side. Right? Once you have more visibility into that, you can make much more sound decisions, and you can set, you know, ROAS or return on advertising spend targets, things like this for various teams. And so I guess we had a bit of first principles intuition for, okay, if we're putting this much money into this, these are the kind of outcomes we should be seeing. We weren't seeing some of them. Yeah. And then secondly, we put in place better and better tracking, which would... You know, which kind of ultimately shows what's happening and kind of, you know, if things aren't really working in the engine room, it becomes very clear when you have all the metrics. So I think that would be kind of how we help find those problems. You know, Fungus background is advanced, computing, minds, applied math, lots of our team are pretty quantitative. So if there are no metrics in a unit, you know, we quickly put in place metrics and then sort of find the truth, I guess. And I think that metric driven culture has been quite useful as we've continued to scale and scale and scale.
00:23:07 · Jamie Beaton, Paul Spain
Particularly going from one fifty to 400, that's been a much more smooth, I think, ramp up because we now have those, KPIs in place and, you know, infrastructure, which we keep improving. But I would say it's pretty robust. And we've got a really good chief operating officer, called David Fried. He was a really high achieving student from Harvard, top in economics there, went to Goldman Sachs, really strong data scientist. And then he's been hitting up our charge on the service delivery team, putting in place these metrics. And, you know, that plus Penny, for example, building a pretty good infrastructure. So I really recommend founders that are trying to go fast, raise a lot of venture capital they need to they need to go. That's their mandate to make sure they have they have those metrics so that if you do take bets and stuff, you at least can, you know, measure the outputs and then evolve and iterate and learn. [00:23:46] S1: And when you've when you've gone for funding, how how ambitious have you been in terms of what you've what you've put on the table? Because you've raised... How much money have you raised so so far? Share on that front.
00:23:46 · Paul Spain, Jamie Beaton
[00:23:46] S1: And when you've when you've gone for funding, how how ambitious have you been in terms of what you've what you've put on the table? Because you've raised... How much money have you raised so so far? Share on that front. [00:23:58] S0: Yeah. We... We've raised ballpark about 60 mil USD, so that gives you a sense of how much capital we've raised, which sounds like a lot in New Zealand. I don't think it's that much compared to Silicon Valley companies we benchmark ourselves to. And broadly speaking, I mean, we are ambitious. So with both our college admissions offering, you know, we see a massive market all around the world. Lots of very, you know, ambitious families that wanna make sure their children are equipped to succeed in a very competitive environment. That's a very big market, and so... And it's also across many geographies. So we needed to raise capital to dominate that niche across across the world. My strategy was very intentional. I didn't wanna go into America or particularly China that much in the early days. I wanted to focus on geographies that were quite uncontested, so I went into places like Russia, like Korea, like Brazil, and, you know, built up our operations there. Largely, that kind
00:23:58 · Jamie Beaton, Paul Spain
[00:23:58] S0: Yeah. We... We've raised ballpark about 60 mil USD, so that gives you a sense of how much capital we've raised, which sounds like a lot in New Zealand. I don't think it's that much compared to Silicon Valley companies we benchmark ourselves to. And broadly speaking, I mean, we are ambitious. So with both our college admissions offering, you know, we see a massive market all around the world. Lots of very, you know, ambitious families that wanna make sure their children are equipped to succeed in a very competitive environment. That's a very big market, and so... And it's also across many geographies. So we needed to raise capital to dominate that niche across across the world. My strategy was very intentional. I didn't wanna go into America or particularly China that much in the early days. I wanted to focus on geographies that were quite uncontested, so I went into places like Russia, like Korea, like Brazil, and, you know, built up our operations there. Largely, that kind [00:24:45] S1: of foreign push has been pretty instrumental to our success. So, yeah, just sort of stopping there for a minute, how do you actually do that as a business that's operating in New Zealand? Things are a little bit different now in terms of terms of travel, but when you when you started doing that, what did it actually, you know, what did it actually look like? What were the steps? Yeah. And what was the, you know, what was the hardest thing, particularly if you're you're in a country where, you know, English isn't the first [00:25:12] S0: First thing.
00:25:12 · Jamie Beaton, Paul Spain
[00:25:12] S0: First thing. [00:25:12] S1: First language.
00:25:13 · Jamie Beaton
[00:25:13] S0: The the key thing to be is pretty opportunistic, right, about opportunities as they come up, I guess. So let me give you a funny story. So I went to Thailand for this competition called the Global Student Entrepreneurship Awards, which is like a student challenge thing that we were competing in. I was on a boat, and I sat... And I was next to this lady. I thought she was actually about my age, you know, which is kind of funny. And I got talking to her, and turns out she was about 35. She went to Harvard, did applied math and economics, same program as me. And she had recently been working in private equity, but it had some young kids and was looking for a bit of a transition. And, you know, she spoke Thai. This was in Thailand, by the way. And, immediately, I leapt on that and said, hey. Do want to expand Crimson? It's going really well in Thailand. And she became our managing director of Thailand and did an incredible job of getting that, you know, off to market. I went to Singapore to visit my Singaporean team, and I was in the cafeteria of Yale NUS, which is a Singaporean university that are partnered with Yale. I was talking to this shop New Zealander called Andy Chen, and he told me, hey. Look over there. That kid over there, he's known as a really entrepreneurial guy on campus, does a lot of the startup competitions, is really good at computer science. You might wanna chat to him. So I got speaking to him, and turns out he he was speaking fluent English, but turns out he spoke Russian. I said, oh, how do you speak Russian? He said, I'm I'm half Russian, half American. And I said, what do you feel like about launching Crimson in Russia? And then within a couple of weeks, he he had confirmed his gap year, and he had landed in Russia and was expanding us over there. So for The UK, you know, my early director, Janine Manning, one of our first investors, she was moving to The UK, and so naturally, you know, she had the mandate to start us over there. And so it's about getting the tent poles out of people that know the local markets pretty well, figuring out what's happening. And in many cases, these early entrepreneurial people figured it out pretty well, figured out playbooks that we learned from and worked with them to succeed in. And then we kind of continued to optimize and optimize this...