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. Hey, everyone. So my name is Derek Steer.
I was the founder and CEO of Mode.
Chapter 2: How did the guest's background influence their approach to business?
I'm going to be talking about really one thing, which is the thing I think you need to focus on above all of the problems that you may see out there in your businesses. But, you know, I had the Beatty title, so you're all here. My background really fast. So I started my career in economic consulting. I studied economics in school.
I went on to work in tech at Facebook first and then at Yammer, both before and after the acquisition. And in those jobs, I was doing analytical jobs at those companies. And I noticed something, which is that both of them were building internal tools.
They kind of were fed up with the stuff that was available out on the mass market, wanted to work in a different way, and so they built stuff on their own. And if you looked around at all the other companies, Google, LinkedIn, the ones that were really good in the way that they work with data, they were doing the same thing.
Chapter 3: What are the common problems that SaaS founders face?
They were building their own tools. And so my co-founders and I, after having built these tools at Yammer, kind of scratched our heads and thought, OK, that's weird. Maybe we should just go start something where we build these exact tools. Because we think everyone's going to want to work like Facebook. So let's go build those tools and give them out to our audience.
Let's be the people that enable the rest of the world to be as analytically competent as the best companies. So in 2013, we started Mode to do that. I did it with two other guys. One of them is sitting in this room somewhere. He just gave a talk on another stage, on the CTO stage, like 40 minutes ago.
Chapter 4: What lessons did the guest learn from their experience at Mode?
So if you were lucky enough to have been in that room, you're getting a lot of Mode content today. And then another one was an engineer. So Ben is my co-founder, my fellow economist. Neither one of us know how to code. And then we had one guy who did, which is going to be kind of a theme of this conversation.
So about four years ago, oh, the last thing I should probably mention is the reason I'm a former CEO is I left Mode fairly recently. So I did a nine-year run as a CEO, got the company to mid-eight figures in revenue, and then stepped down to head off and work on a new thing. But I want to talk about mode because it's where I learned a lot.
And about four years ago, I started keeping this doc for myself. And this is a screenshot of the actual doc.
Chapter 5: How can companies identify what they are doing right?
This is the actual title, Lessons Learned the Hard Way. Kind of tells you a little bit about the place I was in when I made this document, or at least when I started. And I don't know if you can make any sense out of these notes. That's not really what I want to talk about today. I really just wanted to bring this up to say, There's a lot of stuff that came to my mind.
Once I started thinking about all the different times where I had some problem that felt existential that I really needed to go solve, I would go write it down or refer to something on this list and use it as my mental check of, OK, am I thinking about this the right way? And so as I was thinking about putting together this talk for today, it occurred to me I could talk about all of these things.
You know, like, and these things, probably many of them seem obvious, like solve a real problem. Yeah, okay, of course, right?
Chapter 6: What impact does company culture have on performance?
Solve a real problem. Yeah, we got to solve real problems, right? Vitamins, painkillers, all that stuff. You want to be solving something that actually matters to people. Okay, great, we know that. You're always selling. Good culture versus winning culture. I actually think the previous talk about remote, not remote, to me, it really is about what is the flavor of culture that you are creating?
Remote, not remote. Is it good?
Chapter 7: Why is focusing on community important for SaaS companies?
Is it winning? Is it both? Those are different things in my mind. There's all these sorts of things to keep track of. And I got to feeling like being a CEO was this really difficult balancing act where I was trying to keep... 25 plates spinning. There's about 25 items in this document now, lessons that I learned the hard way. In reality, there are more lessons than that.
But I wanted to keep this list for myself partially so that I could go reference it just to make sure I wasn't missing a plate that had to be spinning. And the more I thought about it, the more I thought, that doesn't matter.
Chapter 8: What mistakes should leaders avoid when scaling their business?
This is actually an impossible task. You can't keep all of these things in your head all the time. You're destined to fail.
and instead there is one thing right i thought about all these things it's like okay if i keep all these plates spinning what's the impact that that has and for me as as an analyst by trade my job for a long time was solving problems you know it like and and my boss you know the ceo previous companies they would put me on the hard problems and i got to go crank on them and that was what i got really into and so that's where i naturally gravitate but it turns out
that this is actually what I should have been doing as CEO. You can screw up a lot of things as long as you figure out what you're doing right and do more of it. And if you take one thing away from my talk today, this should be it. So the rest of my talk, what I'm going to do is I'm going to tell you an example of how I got this stuff wrong.
And hopefully through that, some of you will be able to identify, oh, I'm making some of those mistakes. I should probably refocus my efforts on what's going right and go do more of that.
And then before I get into this example, just as sort of like an internal test, I want you all to think about big successful companies you've worked at or your friends who've worked at some of these hyper growth companies and what you hear from them about what it's like internally.
Because in the companies I've been in where I look around and two thirds of the people arrived at the company in the last year, It's an operational horror show. It always is. The fastest growing companies seem to always be in the news. Now there's a WeWork show and there's an Uber show. These companies were such horrific disasters internally that they had TV shows. It's that good.
And yet they're so successful. Really successful. These are the most successful companies. Why? Well, it's that they found something that was really, really, really valuable, and they just kept doing that thing at the expense of a lot of other things. The example I want to talk about today is blogging.
And actually, I'm going to talk about my co-founder, Ben, who is in this room, just coincidentally. These are two blog posts that he wrote. One on the left is the first post on the Mode blog ever. And you can see it was in September 2013, which is just after we started the company. So the founding date of the company was March.
August 23, 2013, and then within a couple of weeks, Ben was cranking out blog posts. And this had to do a lot with the roles of the founding crew. We didn't really understand how valuable this would be, but we had this hunch. Since Josh was building the product, Ben and I were trying to find ways into the market.
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