When First Failures Breed Second Successes | Pere Codina from Kompyte

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Pere Codina 0:00
We realize that our best customer was struggling with competitors. They were like literally losing money, in advertising and so on, because they couldn’t keep up on everything that was happening out there in the competitive landscape.

Alexander Ferguson 0:12
Pere, I’m excited to continue our conversation. Now hearing more about your story in part one you shared of round your your product company, which is a competitive intelligence automation platform, really helping those who are in product marketing or sales enablement, easily track what their competitors are doing, and automate that analysis. I’m curious though, going back a little bit before maybe in five years, you didn’t start in the US and you share it at the end of our interview that you wish you’d know, you jump into the US, but what’s your story? How did you get to where you are today?

Pere Codina 0:53
Wow. So we started in Spain, you know, we, we started this company, because we had a company before, and that company was more like software development, online business and so on. And like helping businesses sell online, right. And we realized that our best customer was struggling with competitors, they were like, literally losing money, in advertising, and so on, because they couldn’t keep up on everything that was happening out there in the competitive landscape, right? So we look for so we were looking for a solution to help this guy, so I wanted to help him, he’s our customer, and he’s complaining about this and, and see if we can do something. And maybe we can find a software that actually, I mean, every company has competitive there has to be something out there. Right? There was nothing. So they’re just how we said we should build something because it’s not that they’re going to be less companies. And, and we started and we started the software, right, then we started building the software. And you know, initially, there is a playbook, you know, especially when you are, you know, in all their, let’s say startup ecosystems. There is a playbook that, that, that at that time said that you have to write it in your country. And then you can go one more internationalized right. And I believe that this label was copy pasted from the US, it’s like, if you’re in the US, you’re in your country and globally, right. But if you are out of the US, and your account is like, you know, less than a 10th part of the US, your market is not that big. Right? So and you know, all your neighbors are speaking in like 10 different languages. And that’s a match, right? This means 10 languages and cultures. And, and, and, you know, that’s cool. But the moment we there is also another thing that we will learn with the time that software categories start tend to start, you know, in the US, except for some other get from very exceptional cases. But the majority of big support categories have started in the US. And they and they expand to other geographies after that, right. So what we what we did, we found this, honestly, we found this by accident. So we we send some emails to the wrong people. And they replied, and they became our customers. So doubles, then. Yeah. And then what do we did we repeat the process, right? So we send 1000s of emails to US companies, and we started to grow like crazy. And, and after that, you know, at some point, we had like very big laws using the software. And as granted, as you know, being accepted in Python to startups in the accelerators in San Francisco or in Mountain View. So we went to 500 startups, and then even we can like learn all what we’re spending for us to learn more than, like, Hey, this is what the game is about, you know, welcome to welcome to the Silicon Valley. And, and then, you know, we started working in the night, I mean, we already started before, like, you know, bossing us working right? In Spain, we continue to do that we build a team in Spain to that until we, we we would say we were large enough to raise funds and, and move to and move to Austin, we had to pick a place where we wanted to build our teams. And we had like many conversations with people in the US and more and more people was recommending as Austin Texas, and you know, again to the city, I fell in love with the city. And here we are.

Alexander Ferguson 4:12
I love it. And you still have though offices back in Barcelona.

Pere Codina 4:15
Yeah, yeah. So we have like, you know, all engineering themes and so on and product teams, they are in Spain. And then you know, all our go to market games that we did is like sales, marketing and customer success. And you know, the headquarters and the rest isn’t often Yeah, so everything is Gaussian. But

Alexander Ferguson 4:33
I got it I kind of It’s a fascinating story kind of here almost you started and then you go through the the typical set startup journey in San Francisco and yeah,

Pere Codina 4:44
sounds like you know, we we you know, you don’t know what you to know right? Until you until you’ve seen it and then when you say there’s like okay, that’s that that is what it is right? So we have to do it this way.

Alexander Ferguson 4:55
Did you sell fun to begin bootstrapped? You get VC funding equity?

Pere Codina 4:59
We get A very early morning, like, you know, friends holds on finally, and so on. I think we were lucky at this point that the fact that we were tracking competitors that sound sexy, right, so, and know that that attracted that guy the interest of like a bunch of like angels and friends foes and finally in, like in Barcelona that kinda like helped us start and we, you know, we we had like good traction when it comes to like, you know being known in the local ecosystem, right? It’s not that much of like an ecosystem, it’s like, it is a great ecosystem, but it’s not that there are like millions of companies or hundreds of 1000s. Right. So everyone knows each other. And, and, you know, we we did some good products there. And the moment we ended in 500 startups in San Francisco and Silicon Valley, that also, you know, help implement this feeling of like, you know, these guys are doing great things. So we weren’t very lucky at the beginning, that we had the support of this initial investors. Yeah.

Alexander Ferguson 6:00
Any thoughts on on what a mistake one could make when you’re seeking funding any tips or thoughts around that, that you could share?

Pere Codina 6:09
seeking funding? Well, guides, that’s never easy, right? It never gets easy. That’s it, it always, it is always more complicated and always more difficult to actually seek funding, I think the one thing that I would recommend is, you know, try to always have a profitability plan in mind. Right? So it is not that complicated. You know, we were very, I would say, in this case, in this sense, we are also lucky that, you know, we have a significant amount of, of the team that is in areas that are not extremely expensive as Google exit San Francisco, right. So that helps keep this companies and that shortens the time or shorter things that are requirements for profitability. So if I had to recommend the founder or something is like raise the minimum you can raise at the beginning. I know they just happen sometimes. Because, you know, it depends on what finally come from or it depends on what have you done before, right. And always had the mind always have always have a plan to be profitable the moment because there are two stages before making money or after making money before making money, who cares? Or just burning money, right? So it like it has to sound sexy, it has to be call and get to the bottom in the morning, that’s the reality, you’re not making any money, right? The problem is, when you start making money, everyone starts measuring. At least that’s how it works in b2b, the moment you cash dollar, the moment you start reporting, MRR Arr, everyone is going to go looking at you. And, and and they will look at this number. And no matter what study you explained, they will look at the number and how this number is taught. And this is the only thing that this nobody’s going everything’s gonna be fine. There’s nobody’s not growing, oh, doesn’t matter how cool what price you have done, it’s not gonna look great, right. And, and, and the reality is that there are ups and downs and all sorts of moments. So get ready for the time when the number is not going up. And you are doing great, because you will be the only one that will believe that. And if you stick with this, you know it, it’s going to get back to growth, it’s going to continue growing, and you’re going to show everyone that you’re doing great progress, right. But that could mean that you have to be profitable. So look for seek for profitability as soon as possible. And this doesn’t mean being profitable. This means being able to be profitable.

Alexander Ferguson 8:52
Now ripple insight right there. You talked about being able to marketing growing, any tips when it comes to scaling, and especially in today’s world where it’s difficult to get attention, everyone’s overloaded with concentrate distractions, how any tips on how to get attention attraction when it comes to b2b

Pere Codina 9:13
people. That’s, that’s how I that’s what we learn, right? So there is also a path in the journey of an intrapreneur that when you start a company, you’ll build a software. You and your co founders, you’ll build the software, you sell the technology, you run the ads. You know, it’s a bunch of people that are actually doing all the work, right. And that works. And then at some point, you realize that you’re no longer calling themselves or you’re not running these ads. You’re not in all these sales calls. You may be in some sales growth, but you’re not doing the sales. Most of them you’re so what what is it about and and how is that the better the company goes, the less things, the less of these things you’re doing right? Like, yeah, there’s a lot of people. So a scaling is, is, once there is a market, the market is spotted, and the vision is clear, it’s all about finding the people that will actually do this right will actually help execute this vision, right. And it’s all about culture, and execution. And having the right people, making sure is the right fit for the culture that actually needs to be set to succeed to succeed in this industry, or in this business. And, and, and the most complicated thing is finding the people and finding the right people and keeping the right people, right. But the moment this happens, it’s magic. Because it’s, it’s, there are people that can do marketing way better than you have never thought there is people that are, you know, people that can do sales better. There are great developers that can develop software way better than you have ever done. Right. And your mission as a founder is fire them. And protect this team and this team that did

Alexander Ferguson 11:11
is there any common mistakes that you have seen are made when it comes to hiring a lot?

Pere Codina 11:16
A lot, you know, we, we didn’t actually have an actual culture code until maybe like two years ago, and, and that, that is something that we some time regretted. So that I think, you know, we again, because you’re doing all the work, and you’re, you know, used to do all this work. We, we all know that it’s people that will love having the same and that is people that they are great people, but they’re not a fit. And it’s not their problem, it’s our problem, we failed, because we didn’t identify that some people could not be a good fit in the company. And the moment you’re hiring someone that is not a good fit. It’s not their fault. It’s your fault, right? And if you don’t know what the fit is answer for. And, and that’s very important. So then we we, we kind of like roll back here and say like, Let’s build a culture called, let’s say, what are the things we’re gonna be looked for? And let’s just stick with this. And this means discarding a lot of candidates, kind of like an almost scientific manner. Like, it’s like, we’re looking for this, and this is not here.

Alexander Ferguson 12:34
Beyond the resume, what methods do you use to assess the potential of a candidate,

Pere Codina 12:38
I’m one of the methods that worked really well for us kinda like we’re not applying it 100%, but I’m trying to remember the name of that that book, actually was helping, as I says that it was like a an HR book that was helping us identify what are the skills that we want that I’m happy to share it with you after I’ve done I’d like, we can post the links, but that we, we, you know, we use a methodology that actually says, you know, we have like a scoring of like, soft skills. And then we we assess these soft skills during the interview, and we get more than one person to validate them. And, and let’s say, you know, we need someone to be at a certain point, or, you know, let’s say, We need someone to be better with a negotiation, or we need someone to be very good at the stress management or something like this, then we we’re not hiring everyone to squeal Right? And, and, and these are the main I’m sometimes I’m looking for the thing is that I am not. Right. And, and it is, yeah, that’s, that’s what it is. Because this person is not going to be the CEO, this person is going to be another thing in the company, which is probably going to be even more valuable. And, and, and we need this skill, and we’re looking for those with soft skills are very important. You know, we tend not to, you know, we look at the resume, what has this person done before, and it is not always a guarantee that it’s going to work. So we assess this, and we might speculate the main values of our culture code, right. And, you know, in our culture code, being a team player is the top one thing. And and we have to describe right, well, you know, we’re talking about transparency, honesty, about commitment. We’re at some point that that that this is not going on, we move forward.

Alexander Ferguson 14:31
Having that team excellent team allows you to do so much more. So when you coming back to the conversation around expanding, especially expanding into new markets or new countries going from Spain to the US, is there any anything you think that people should consider or need to consider when Yeah, when expanding?

Pere Codina 14:51
Especially when you’re hiding, right? So so when you’re explaining to us, I mean, first thing for, you know, for European founders The US is not about speaking English, it’s about a different culture. It’s, it’s not only about the beginning, there is a complete different culture here. And even if, you know, we’re all in the Western world, and kinda like, we share a lot of things, there are a lot of differences a lot. And, and this man, this is exciting.

Alexander Ferguson 15:21
I’m curious, like, what would it be like top three things like that, you know,

Pere Codina 15:26
I don’t know. And that is, there is there is a list of things we could spend, like, I don’t want to find, like top three things, because we’re gonna find the topics now. And this is not, this is not what I wanted to do. But you know, even like, the words that we use, even in Europe, depending on whether you’re in Europe from that completely changes, so a Spanish person with a German person or a completely different, right. And, and you can not even compare that and then and then you add an America and it’s like, okay, this is an activity, right. But still, the main thing here is not not only is it Listen, there’s going to be like, like how one of our friends, one of my friends described that, I listened to the distance here, that is the physical distance, which means different working hours. So that, that that is the the cultural distance, and that is the language distance, right. And, and these three things are existent. So when you’re, when you wake up in the morning, in the US guys in Europe have already been working for like four or five hours, right. And if you email a guy, a guy in Europe in the afternoon, this guy is already living. And, and you know, it also works vice versa, right. So the energy is of the team are different. And you need to balance this, you can leverage this in a lot of ways to live in today. So you can have your engineers to the price of water, while people in the US is living, or just like most of our customers living, and they are not doing the non hostile work in any special working hours, because it’s working. So a lot of upsides that are different cultures, this means that they see things differently, the concept of what’s right, and what’s wrong is different. It is slightly different. And what is accepted and what is not accepted? And how would you say how would you start the conversation, or how would you write an email, it’s completely different. So you got to train these teams on this, these things have to know what to expect, and what is normal. And the fact that someone is not talking to you as you are used to being taught to doesn’t mean that it means me but maybe they don’t speak your language that well. And it also means that, you know, they, the way they are doing it this way they would speak to their, to their family, the people they love. So it’s not bad, right, but you need to know that because you may fly this road or this is implied or this is you know, whatever, right? And these things happen, and you know, you have the demon days, but the good thing is like, then you have multiple points of view. And when you have multiple points of view, you are also in a better position to empathize with like any sort of customer or any sort of people out there. So if you leverage this, you can explore this. So there are, you know, a lot of stuff to, to, to, you know, to, to consider when doing this. But the main thing is like there are going to be different cultures, there’s going to like different cultures and different mentalities and and the difference in the time in the in the working hours and the time zones is important to keep in mind,

Alexander Ferguson 18:33
I can imagine your your cultural awareness and intelligence has definitely increased to be able to have to look at multiple angles. That initial outreach, I imagine there’s a lot of entrepreneurs and companies that are wanting to either get into the US or those who in us are looking to get out those initial emails to get you said you send started to send a bunch any tactics or thoughts you can share that made it work well. And any lessons learned when it comes to that?

Pere Codina 19:01
Well, we broke all the playbooks right. And and that’s it so you know, normally you don’t you don’t have to do outbound normally you don’t have to do outbound until you have a very clear target that it’s going to grant do an exceptional reply rate which I don’t know what exceptional replied right stands for anymore. But you definitely was like, you know, you it is, let’s say after all this journey, when you should start doing outbound and gotta go like Target by target and making sure that we use outbound to find the market. So the way we do it is we swipe the markets we send the same amount of emails to every different industry and company sizes so we broke the entire market in like a matrix of industries company size. And we send the same amount of emails like you know, 1000s of emails to every one of them using multiple domains and you know, I’ll tactics that you can use I guess we’re glad we didn’t hide the fact nor so sorry about that. We had any dollar. And, and we had to do something, right. And we’ve had the clue that there was a market out there. So we strike the market. And then we find some spots where we had higher reply rates. And we saw these companies, and this is how we got the initial production. This is there is one thing, there’s like, if you tried to sell everybody you make sell to a lot of people, that doesn’t mean they’re going to be your customers or your best customers today. So that is a consequence of this, would you like any of them turn. But then we’ll learn another thing, which is like one of the guys and then turn. Now, it is very hard to explain everyone out there, you are churning customers. At the beginning, when you have no money, and you’re running out of money, and all this stuff, it is very hard to explain this. Because even if it works, it is very hard to explain it like so you’re telling me because remember, even if you have $2,000 of MRR, they’re gonna look at the MRI, anything else? Right?

Alexander Ferguson 21:02
And you’re like, No, no, this this is this is part of the process. When you

Pere Codina 21:05
are like 2000 4000 6000 $8,000, selling is more subscriptions is still at that time. You know, having a bunch of customers and these guys charging like crazy, but some of them not charging, and you’re looking at who’s not charging to double down. No one is gonna trust in you. Right? And then suddenly, you’re cutting the losers. And you stick with the winners. And you started going like this. And I just went, Oh, okay, that was working. But in between, no one will trust you. And, and but the way we did it was like this. It was like we use outbound to have to find a market to kind of like barter with a market. We just like what you shouldn’t do at home. Anytime.

Alexander Ferguson 21:47
That’s really insightful trajectory, and also knowing that if people are, they’re looking at Mr. They’re gonna say what’s going on? This is bad news. But you as the leader have to keep that long term vision say no, no, this is part I have to double down on those who aren’t turning and keep pushing forward.

Pere Codina 22:04
Yeah. And no matter how you explain it, someone will not understand it.

Alexander Ferguson 22:09
Internally and externally. Yeah. Wow. Looking forward, going into 2021. What do you see challenges that you’re going to need to overcome in today’s environment? I don’t know if COVID really affecting you at all? It probably isn’t. But what’s not.

Pere Codina 22:24
So we had some, I mean, I think everyone was somehow affected by COVID Except zoom. Some other guys, but someone was like, somehow affected? It’s not. I mean, we’re working with companies like instead of different industries. So some of these entities were affected. And we have been extremely empathic, empathetic with them. It’s obvious that this guy’s there’s no way, you know, they can go through this without help. So we, we are here to help them. And, and, you know, that this means that, you know, many initiatives we had planned and so on, couldn’t move forward at that time. And, but it’s okay. I think that the biggest challenges in 2021, you know, for us, it’s, it’s all about, you know, finding the right people and continue to do the things that we are doing now. And, and, you know, probably at the end of this period, we’ll have to raise funds again, and when that happens, you know, be you know, be ready for that, right. So it is this this good all with, and I think the biggest challenge here is like, what I said before, like finding the making sure that you have the right people in your team, right the money, if they have the right people, they know how to do it and know how to play. That’s it, and they have done it before. And this is also something that startups tend to fail on that they try to, at some point, hire cheap. And just because you don’t have the money, which makes a lot of sense, but it kinda like works the other way, you have less time and money. So when you have to hire people, you have less time in the morning, because you probably have to raise funds, but you have a limit on the time where you have to prove, you know, results. So I think the challenge is always in the, it’s always in the people side here. Technology is working, right? The actual doing, how they’re doing great. The market is out there, it’s ready. And it’s growing. So I think looks cool. So it’s all about execution, and you know, growing this team and keep executing and keep these values and this culture the way it is I think this is the biggest challenge you know, I believe

Alexander Ferguson 24:42
growing as a leader and growing the business what books audio books, podcasts, have you read the past would recommend or currently reading or listening to?

Pere Codina 24:52
Yeah, I mean, there is there are few works here. You know, I try to read everything that I can. If there are books I really like it is this book like Blade bigger? Talking about how to create categories and how to create your own category and differentiate? It’s, it’s not the very tactical book not for today today. But it kind of like helps understand what what is this about? Right? And, and a book that I enjoyed recently was the hard thing about how things went harder, which I think every CEO at some point should read the book. Kinda like what is happening to you? It’s normal, don’t worry. I think it was like a very, very interesting book. And I mean, obviously, if you want to go down to tactics, and predictable revenue, it’s a great book, even if it’s, you know, it’s been like, we’ve built a lot on top of it right. Then I also follow the guys at winning by design Jacko, has done a great job, showing entrepreneurs how to organize. And I like the formula, because it’s like, all in between all this craziness, it is a lot of insight. And that is something that I really like a lot. And it’s like, you can always go back and say, Yeah, I know what he’s explaining me. But there’s always something in there. Like, yeah, that is what I forgot about. Now, I can go back and say, Hey, we forgot about this. We have to rethink this. You remember that? Oh, yeah. Because we also tend to forget things, right? We tend to forget things that we learned before, just because, you know, we’ll learn but then, you know, you always have to revisit those things. So yeah, I like I like this, like this, this down. That’s a pretty good one. And faster, obviously, it’s faster. It’s like that top one for SaaS companies and SAS founders, like, the content is really valuable.

Alexander Ferguson 26:42
Last question for you. What kind of technology innovations do you predict we’ll see in the near term next year, so and long term, 510 years from now.

Pere Codina 26:53
I don’t like this, I hope we get to Mars soon. That’s, that’s what I would like to see, I would like to see us get into Mars, I think you’re just gonna, it’s gonna make a big change, it’s gonna change everyone’s life more than the virus on anything else, right? I think we face what we are facing with a virus because we don’t have enough artificial intelligence yet. And if we had the systems in place, and already developed, we could use that power to actually identify or actually be able to control this pandemic even better. So I think that’s gonna make a big difference. We don’t even imagine how powerful can these additional planes be? And even if they are completely different, and they are totally complimentary to humans, right? I think we’re gonna say this. And I believe in electric cars, and electric, I believe that we’re not gonna own gardens anymore. The moment we can get closer to each other again, because it’s not going to be necessary when they are self driven. We just have to say, Well, I believe that we’re not going to own cars. We may have a special rights on a car, but we’re not going to own the car. And, and yeah, and I think it’s going to be like the software revolution is just starting and the way that software can change our lives, you can imagine it.

Alexander Ferguson 28:20
Thank you so much for sharing your insights, both of the journey that you’ve been on and what you are building. I’m very excited to see where you go next. All right. Again, thank you, everyone, for checkout kompyte That’s with a Kompyte.com. And you can see more about their product and sign up. Thanks, everyone for joining us again, our sponsor for today’s episode is TeraLeap. So if your company wants to learn how to better leverage the power of video, increase your sales and marketing head over to TeraLeap.io. I’ll see you guys next time. That concludes the audio version of this episode. To see the original and more visit our UpTech Report YouTube channel. If you know a tech company, we should interview you can nominate them at UpTech report.com. Or if you just prefer to listen, make sure you’re subscribed to this series on Apple podcasts, Spotify or your favorite podcasting app.