SaaS Interviews with CEOs, Startups, Founders
3 Phases: Get People, Product, and Profit Right at Each Growth Stage
11 May 2023
Chapter 1: What is the main topic discussed in this episode?
I'm very excited to share this recording with you guys, which happened at our conference, sasopen.com, with over 100 speakers, all founders of B2B SaaS companies. We have a very high bar for what speakers share on stage, so you're going to enjoy this episode where we dive deep into revenue graphs, real tactics, and real growth metrics.
You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom. If you'd like to subscribe, go to getlatka.com.
We've published thousands of these interviews, and if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to getlatka.com and use our filtering tool. It's like a big Excel sheet for all of these podcast interviews. Check it out right now at getlatka.com.
Chapter 2: What are the three main phases of startup growth?
Hello, everyone. I'm Larry Talley and I am the founder of Everywhere. Everywhere is located in Austin, Texas. So we just spent a good past week with South by going on and excited to leave that and come straight here. I'm here to talk to you today about really the three main phases that we go through as we build a startup. And how many founders do we have left in this room?
I know this room is thinning out. Good chunk of us, right? And I would say out of that, how many are in the early stage? All right. How about the seed stage? And I'll go with the final one, the growth. All right. Still a few of us left here. And really how we apply people, product, and profit. And as a founder, I'll probably add one more P to that, which is passion.
I'm gonna go ahead and get this clicker. A little bit about myself and the company. Everywhere was really formed back in 2018.
Chapter 3: How did the founder transition from early stage to seed stage?
Prior to that, I was the owner and operator of another company that had about 15 years that built enterprise software for hotels. Hotels, and if you ever stayed at a Hilton and you get a text message, I invented that over 15 years ago, mainly to drive upsells and show that I can use real phone numbers and a bot to replace humans, and it worked. and became highly successful.
And during that time, I felt like, man, we solved all these problems around customer service and around payment transactions. Well, to me, this looked like, well, what if Stripe and Twilio had a baby? I like to think that everywhere is born based on the mindset of applying a text message conversation to a payment transaction to ultimately help companies collect faster.
And throughout COVID, the company really accelerated. In the early stage, when you really, I would say, have the mindset of hiring folks, it's about being in the right place at the right time. So back then, I actually moved the company to Austin, Texas from Florida. And the big reason that I moved the company is really because perception.
When you're building a company, you want to have the best perception as possible. So if you're in Boca Raton, Florida, right away, when you're trying to raise money, it was about, old people or people that were traveling there or not enough talent. And that would be about zero seconds going through a VC's head or somebody's head that really didn't know much about Florida.
They were in San Francisco, perhaps even in New York. But putting yourself in the right place where opportunity exists and that perception is perceived differently.
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Chapter 4: What challenges arise during the seed stage of a startup?
To me, that was Austin, Texas. So I moved my family there. And ever since then, everything really started clicking and it really accelerated. And you can really see that because back in 2018, we barely broke a million. But after moving the company to Austin, we accelerated very quickly over to almost really over three and a half million. So today the company is very profitable.
We are on track right now to exceed over probably about 25 million in revenue this year. And a really a lot of. Thank you. Because it's a grind. And bootstrapping it in the beginning and in the early days is definitely tough. So to get into that 10 million ARR really involved a lot of hard work and dedication from our team and our people.
During that time at the seed stage level and putting myself in the opportunity, I had one desk in Austin and I really didn't have any employees. I was really myself. I was a software engineer and really just trying to build things out. And at the time I hired another software engineer because that's typically what we do. And really I hired this person to be my replacement.
Chapter 5: How important is location for startup perception and growth?
And I felt the first thing I had to do was replace myself as an engineer and really put myself more or less in the front lines to work in other departments, whether it was accounting,
department to build that out but it was ultimately the HR department where I spent my time and I really leveraged you know my network and I used my network to really make my first hires and you know at that time it's just about it's not like you just want to take just about anyone but I just really needed bodies at the time and hiring my friends what I thought was the right move or potentially would
lead to a disaster really turned out to be in my in my world a really a great thing because these people were really loyal and they spent time with me over the years so it actually worked out well I know it doesn't work out well for everyone else but um you know I really surrounded myself by what I could think about is like family people I want to hang out with drink a beer with and spend time with
But ultimately, it was to really fine tune our product, right? So hiring more engineers, more product design folks, and really focusing now on really getting our product right. Because at the end of the day, as a software engineer, I was building too much. Because ultimately, when I went and put this in front of VCs, I had an app, I had a text messaging system, I had a payments company.
And what I was being told was, You have too much. These are great ideas. And I thought probably one of the sexiest apps out there, but it was too much for people's brains to absorb. But as an engineer, you tend to build a lot of things. But ultimately, I built an amazing application. But the VCs and where the investment went, it went into the payments. That was really the engine and the driver.
So I had to put all my other ideas and products on the sidelines and really focus it on what we like to think of as our MVP, right? The one that we're all going to rally behind and the one that's going to make us the most amount of money.
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Chapter 6: What strategies did the founder use to hire effectively?
And that ultimately was a pay by mobile solution. And the pay by mobile solution was really that solution that basically assigned a merchant account a mobile number. And what was really unique about the mobile number and how we did it
is that we used again like my hotel background real phone numbers 10 digit numbers and local area codes and we used a bot and an always personal license so everything was like hi john this is mary or hi john this is ivy we gave the bot a personality but ultimately a real human can jump in at any time and it was all about figuring out why somebody couldn't pay a bill or get them to pay fast
And if you think about industries like health care, nobody wants to call into a 1-800 number. They just be put on hold or you don't want to get a statement in the mail just to put it on a desk for somebody to get to in 30 days from now. Right.
So being able to send that text message out, the collective money or figure out why somebody couldn't pay a bill was extremely important and it became super relevant. where I felt it was convenience that they were after, but it became contactless. We struck a deal with Visa throughout the pandemic, and it quickly accelerated to a lot of their customers, mainly in healthcare.
Not only did you not want to ship out and send out statements any longer, But ultimately there was a shortage in paper, right? There was a lot of things that were happening back then and they really could not generate enough paper. So we stepped in and worked with some of the largest paper statement companies to start delivering this through text messaging. And guess what?
They're still doing it now today. In fact, there's more text messages going out with a lot of these companies than there are pieces of paper. So I like to think that we're actually doing a good thing based on a number of trees that we're hopefully saving. But it really proved that customers and our patients at this in health care, it wasn't about not paying a bill.
It was about like they had a question and it could be a simple question. Just give them the ability to text it in, get a response back. And the great thing about it, it just didn't have to be a live chat, right? Or it didn't happen over a phone call.
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Chapter 7: How did the company pivot during the pandemic?
Everyone can do and operate on their own time. And that really was the beauty about the text message. It showed that you can communicate to someone and nobody's going to get pissed off to you if they didn't respond to you in zero seconds, right? Because you're not stuck on hold. They're not stuck on a phone. So ultimately...
That idea and that product quickly accelerated and became very widely used. And even companies like T-Mobile and other large enterprise companies really started adopting this as a payment method. And then we had to take it one step further and really simplify it and make it so that you didn't even have to click on a link anymore.
So we partnered up again with Visa and we came out with network tokenization. Network tokenization, if you use Google Pay or Apple Pay, You're leveraging a network token. Everywhere certified your phone number directly with the banks and the card networks. And we're able to use a network token that's shareable across merchants and across acquirers.
And what that does, it actually lowers the cost of the fee and it makes it more of a safer transaction. We proved that it's actually much safer to do a transaction through us with a phone number than it is with a piece of plastic. And it sounds odd, but in the sense that, you know, the plastic came out, they added a chip to it. Everyone thought, okay, we can stop using driver's license.
We can just now rely on this chip. We'll show that you can have tons, a lot more fraud happening out there, especially online.
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Chapter 8: What role does company culture play in scaling a startup?
But the phone number was really two factor authentication. It was very secure. In fact, Our system showed that if you give me your phone number, I can actually repeat back to your social security number. And if I don't know your social security number, you're high risk. And it probably sounds a little scary about how much information is out there.
But if you really think about it, your phone number is tied to just about everything you've done over probably over a decade. And for me, I have had the same phone number for over 20 years. I know most of you in the room probably had your cell phone number for over 10 years. You'd be pretty surprised how much data, including your Social Security number, your family tree is tied to it.
And what we ultimately do now is we build a trust score. So we have identified, we have identity and payment in one, and we're able to not only collect money fast, but make sure that we're actually collecting money or getting paid from someone that actually is the correct person. Our portfolio quickly grew and accelerated. Again, we leveraged the accelerator being the pandemic.
Money movement was quickly shifting. Banks were quickly changing. So there was a gap in the market. We seized the opportunity. We partnered up with all the major banks. So if we use Bank of America, KeyBank, Wells Fargo, all those banks today are our customers and leverage this platform. The car networks, Visa and Discover leverage our platform.
And ultimately, it's that pay by mobile rail solution is what they're really after. So our portfolio has grown well over 10,000 customers today and over 18,000 users log on to our system. So very fast growing and it quickly expand hopefully within the next, I would say, 12 months globally where we start using our technology in other countries.
Ultimately, it's about building brand awareness to getting the name out there, even a name like everywhere. It's spelled a little differently. It's spelled like software. So ultimately, that has to resonate. And that was probably the biggest challenge. But our brand today in fintech has become more or less of a household name within that network, simply because
A lot of times you see our technology or feel our technology, and you don't even know it's us. And that's because a lot of the larger customers, like the BOAs and the Wells Fargos of the world, white label our solution. We allow our solution to be white labeled. And again, as you're a young company growing, as much as I would love to get my brand and have the Everywhere logo on top of it,
everything that we do, ultimately we're spreading like wildfire by leveraging merchants that have thousands of merchants underneath them. And I would say that's probably one of the biggest things that when I was coming up building out this product, it was do I want to knock on a thousand doors or knock on one door that has a thousand customers already? Right. And
I find that it's really about the same amount of time. So we target larger software companies, larger enterprise companies that have the businesses to really go after. And I think that's important at each one of your stages is to leverage that. As we got into, like, I would say into, and everywhere is really in between stages right now.
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