“5 Lessons I Learned When I Created My SAAS”, with Manny Medina CEO of Outreach, & Mitch Russo

Do you know your business could be much bigger than it currently is, but aren’t sure how to get there? I can help!

Always hire for energy. It’s hard to drive a team with low energy. Everyone brings a different type of energy — you need to be able to identify what people are bringing to the table.

I had the pleasure of interviewing Manny Medina, CEO of Outreach. Manny co-founded Outreach in 2014 and now serves as CEO. Prior to Outreach, Manny was employee number three on Amazon’s AWS team, and led the Microsoft mobile division from launch to $50M in annual revenue. He holds an MBA from Harvard and a Masters in Computer Science from the University of Pennsylvania. Manny is a model of vulnerable and transparent leadership to his employees, from his heartfelt weekly email to his employees, to the traditional Friday get-together where the whole company shares their highs and lows of the week. He is a proponent of saving the planet by consuming less and purchasing second-hand whenever possible (he might be the only CEO to take the stage at industry events in shirts purchased from Goodwill). Manny grew up in Ecuador and now lives with his wife and three children in Seattle.

Thank you for joining us! Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

I grew up in Ecuador and came to the U.S. in my early 20’s to go to school. It wasn’t my intention to stay here in the U.S., but it has worked out that way. I’ve been in the SaaS space for a long time — I was one of the first employees to work on AWS when it was first getting off the ground. After spending some time at Amazon, I moved over to Microsoft where I led the mobile division. After spending so much time at these large companies, I wanted to take some time and build a company from the ground up. I got into the Techstars program here in Seattle with one of Outreach’s other co-founders, Andrew Kinzer. In Techstars, we meet the guys that would become our two co-founders, Wes Hather and Gordon Hempton. We started working on a startup called Group Talent, which was initially a recruiting tech tool. Eventually, we’d pivot to what has become Outreach.

What was the “Aha Moment” that led you to think of the idea for your current company? Can you share that story with us?

The first startup we worked on, Group Talent, was a very small team and we needed a sales solution that helped our team of two sell like a team of 20. We built a platform that could do personalize customer communications at scale and we were booking all kinds of meetings. What ended up happening was customers weren’t as interested in our recruiting software as they were with our ability to get their attention. That’s the solution they wanted.

Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?

Right before we made the pivot, things were not going well for Group Talent. We had maybe a month of runway left, and the team was ready to give up. I was meeting with an investor down the bay and I started to talk to him about the potential of pivoting into the engagement platform that would eventually become Outreach. But the team back in Seattle was busy inventorying all our tech assets to put them up on eBay. So when I called them, we had to have a deep conversation about if we were really going to make this pivot. Luckily for all of us, the entire team agreed.

So, how are things going today? How did your grit and resilience lead to your eventual success?

Things are going really well — In just five years, we got a billion-dollar valuation and became a unicorn. We’ve doubled our revenue, every year, for the past four years. We have more than 3,300 customers, support more than 60,000 reps, and a team of more than 350 people. Grit is actually one of our core values. Those were some very tough years in the beginning and our ability to grit it and get through a really hard period is what lead us to our success today. I want our employees to have that ability to not give up and get to the other side of things.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?

I learned a very important lesson early on — that it’s not the idea that counts but the execution. We working late one night in the early days of Outreach when one of our co-founders came across a post on Hacker News from another startup that had the same value proposition as us. We were at a critical point in development — no one had really developed a workflow automation for email. Most companies were offering template management and detecting opens. We were focusing on detecting a reply. We were on this third try when this other startup announced they were entering the space.

It definitely caused a moment of concern. We discussed it and then the realization hit us that they were a startup too — they hadn’t even launched. We made the decision then to “out hustle” them. Assuming just because someone has the same idea doesn’t mean they’ll be successful. In the end, one of the founders approached us for a job down the road.

What do you think makes your company stand out? Can you share a story?

Our culture is the thing that makes Outreach standout the most. We work very hard, and we’re very upfront about that. We’re building a category that requires a lot of dedication. The people we attract are very gritty — meaning they aren’t afraid of the amount of work ahead of them. We also have a very open and honest culture and that really supports our core value of having each other’s backs.

Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?

First and most importantly, you have to love what you do — every aspect of it. I have a bottomless curiosity of human beings and that’s what really drives me to understand how we communicate. You’re going to do have work on the problem you’re trying to solve when you’re tired/sick. That’s why loving it is so important.

Always hire for energy. It’s hard to drive a team with low energy. Everyone brings a different type of energy — you need to be able to identify what people are bringing to the table.

Second, constantly work yourself out of jobs. Hire people that you trust and can do better work than you can. Then your role can transition into one focusing on helping and coaching. When you hire someone who’s better than you, then the question becomes what can you coach them on.

Third, hire people that have strong self-awareness and don’t need to report to you for their own self-worth. If you hire for work, output, and energy, it won’t matter to the person where he/she is working. It helps lay the groundwork for a dynamic and open organization.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?

My family — especially my wife — who understands that this is a calling for me, that this is what I need to do with my life.

Also our early investors — they invested in the character/concept. When they invested, it was very early when it wasn’t clear what exactly Outreach was going to be or how it would end up. People invested in our team — as people. Same with our early customers.

We got a hard time early on for having four co-founders. We evenly split the company amongst the team. Starting a company is hard — with four people it’s a lot more bearable. We wouldn’t be here without our co founders.

Approximately how many users or subscribers does your app or software currently have?

3,300 customers supporting 66,000 reps.

Can you share with our readers three of the main steps you’ve taken to build such a large community?

1. We’ve proven that having a sales engagement strategy leads to better customer experience, and in turn, more predictable revenue.

2. We created the modern rep workflow with features like automated playbooks, triggers, among others.

3. We are leveraging machine learning and artificial intelligence to help reps make smarter decisions based on real-time insights.

What is your monetization model? How do you monetize your community of users? Have you considered other monetization options?

We are subscription-based.

Based on your experience and success, what are the five most important things one should know before one wants to start an app or a SAAS? Please share a story or an example for each.

1. You need to love what you do — every single aspect. There was a point in time where we were unsure of what was next for the company — we were close to running out of funding and had to make a major business pivot. Luckily the pivot worked.

2. Don’t be afraid if there is someone else in the space, but you do have to commit to working harder and smarter.

If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger.

Creating universal healthcare. Right around when we were making the pivot, I had a dental issue that I didn’t address and I ended up in the hospital. I didn’t have insurance and didn’t want to incur the cost of going to the dentist because I was putting all my resources into getting Outreach up and going. People shouldn’t have to balance getting the healthcare they need with having to maintain their business or take care of their family. If potential entrepreneurs had access to reliable healthcare, I imagine more people would take the leap and start developing their ideas if they knew they had more security around their health. We’d have a more innovative environment.

Thank you for all of these great insights!

“5 Lessons I Learned When I Created My SAAS”, with Manny Medina CEO of Outreach, & Mitch Russo was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.

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