Ep. #1029 - Becoming a Top Learning Management System (LMS)
In today’s episode of Startup Hustle, we’re looking into how Ted Blosser leads his business to become the top learning management system. Matt Watson welcomes the CEO and co-founder of WorkRamp into the podcast. So why don’t you jump into their enlightening talk on getting investments and discovering the right market fit? And learn what a learning management system can do for your business too.
Covered In This Episode
Get to know what a learning management system (LMS) is and how WorkRamp works. Learn how to get into the Y Combinator and take notes on how you can grow your startup. Everything you need to know is rolled into this session with Matt and Ted.
In addition to that, they share insights on how you can get investments. There’s also a bit on how you can hire the right people.
Don’t miss this episode of the Startup Hustle. Tune in now.
- Ted’s backstory as an entrepreneur (01:45)
- The inspiration behind building a learning management system (LMS) (03:37)
- On maximizing your resources to gain competitive advantage (07:46)
- How did Ted and his company get into a Y Combinator? (09:38)
- Helpful use cases for the LMS (14:54)
- On empowering users to create content on the LMS (16:41)
- The journey to scaling the business, its challenges, and its growth (19:01)
- How Ted found the niche that enabled business growth (21:41)
- About building your lead list with LinkedIn (23:53)
- The pressures of running a business (27:32)
- On managing a fully remote workforce (31:23)
- Hiring Silicon Valley engineers versus offshore engineers (32:50)
- Advice for entrepreneurs (37:58)
That’s a really cool use case on the customer enablement side where you can enable your customers to be more proficient in your products. And also help save them from things like churn or low engagement.– Ted Blosser
It’s like when you’re trying to sell to everybody, you’re almost selling to nobody. It’s hard to get momentum in any particular area.– Matt Watson
We’re talking about market fit. There’s an employee market fit, right. One big thing we learned in our hiring journey is making sure people opt in. So, actually, we don’t sell people hard. In our recruiting process, we need people who are like, hey, I do not want to go to Google. I want to go to this early-stage startup because that’s where I fit in.– Ted Blosser
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Moreover, take note of the services of our Startup Hustle partners. They may come in handy for your business growth too.
Following is an auto-generated text transcript of this episode. Apologies for any errors!
Matt Watson 00:00
And we’re back with another episode of the Startup Hustle. This is your host today, Matt Watson. Very excited to be joined today by Ted Blosser from WorkRamp. His company has a learning management system. We’re gonna learn all about his business and the trials and tribulations he had. Before the episode, we were talking about some really cool talking points today. So I’m on the edge of my seat to hear what he has to say. Before we get started, I do want to remind everybody that today’s episode of Startup Hustle is powered by FullScale.io. Hiring software developers is difficult. Full Scale can help you build a software team quickly and affordably and has the platform to help you manage that team. Visit FullScale.io to learn more. Ted, welcome to the show, man.
Ted Blosser 00:37
Matt, thanks for having me. Excited to be here.
Matt Watson 00:40
You know, since you’re a, you know, founder of a company that builds a learning management system, I think we’re all gonna learn something today, right? I mean, that has to be.
Ted Blosser 00:49
It’s as advertised. Yes. Hopefully, I could share some great knowledge.
Matt Watson 00:54
If anybody knows how to teach somebody something. It’s got to be used. So to get a start today, why don’t you tell us a little bit about your background? And then how do you, you know, eventually become the start for WorkRamp?
Ted Blosser 01:05
Yeah, for sure. Maybe I’ll start. I won’t go all the way back to my childhood and start my professional career.
Matt Watson 01:12
No brainer, migrate preschool? What, three schools even better? No, I’m just kidding.
Ted Blosser 01:18
I could go all the way back. There might be a three-hour podcast, though. But though, professionally, I started my career out at Cisco making sales and went to St. Clair University. I have a funny story about how I just landed in sales randomly at the career fair. I won’t go too far into that. But I started at Cisco to learn the ropes of selling. Then I actually tried my own first startup and failed miserably. I was what you would call an entrepreneur at that time. Then I said, hey, I need to go learn how to actually build a real startup and learn from the best part of this learning journey. So I joined Box back in 2011 under the leadership of Aaron Levie. If you’ve heard of him, it was just a great experience. I spent five years there, learning the ins and outs of SAS, and met my co-founder there. And when I felt like I was ready, I always knew I wanted to do another startup because I loved the entrepreneurial journey. I jumped ship at the end of 2015 and started WorkRamp, and I am happy to share all the trials and tribulations and wins and losses we’ve gone through over the last seven years on this fun startup journey ever since.
Matt Watson 02:27
If I remember right, one of the founders of Box is actually from Kansas City.
Ted Blosser 02:32
Oh, yeah. Which one? Do you know the name?
Matt Watson 02:36
I don’t remember? I should know this.
Ted Blosser 02:37
But I got it.
Matt Watson 02:38
Yeah, there. I think there’s a Kansas City twist there for Kansas fans. But tell us what, what led you to start WorkRamp? Like why build a learning management system? What was the genesis of that? For sure. And actually, maybe we should start with what the hell is a learning management system.
Ted Blosser 02:57
I’ll start there first. And then, I’ll go into how we stumbled into this category. So a learning management system is almost exactly what it sounds like. It’s one of the core infrastructure categories and software, and it’s been around for 2030 years. And essentially, it helps manage learning within an organization. So a company learns in many different ways. It might range from things like security training to compliance training, all the way to sales training, all the way to helping your customers and partners learn. And we’re the underlying infrastructure to actually run all those programs. And that’s the learning management system category. And this category has been around on-premise all the way until now. It’s obviously predominantly cloud. And I would say we’re one of the leading providers of LMS software for that mid-market and SMB category. So that’s, that’s kind of where we sit.
Matt Watson 03:49
Well, there’s, so I’ve actually known a few companies that are kind of in that space. And so for example, just so people understand other use cases, this one of them is a local company here in Kansas City that does training for nurses, like and the nurses have to go through this training and do testing and all this stuff. And they have a proprietary learning management system or whatever. And, when I think about learning management systems, I also think of, like, I signed up for some dude’s courses on how to trade crypto, which I failed miserably at. But, like, you know, I use some kind of learning management system to go through all of the training or whatever, right? Like there are a lot of different use cases for this kind of product. It’s kind of the point.
Ted Blosser 04:30
Yep, that’s exactly right. And that’s more on the consumer or prosumer lens. And we focus on b2b, But you’re totally right. It’s the same concept. Hopefully, you didn’t deposit into FTX there. Maybe stayed in finance, but we definitely do a similar thing, but at the corporate level. Yeah. So what was your buy my a lot easier to do?
Matt Watson 04:52
Yeah. Oh, yeah, for sure. So what was the genesis of building an LMS? Like, there were none that existed. You know, how did you do your niche shares? There were 600 competitors.
Ted Blosser 05:04
And so it’s crazy to think about it when you’re doing market analysis, but I would say our story’s a little bit more like when I heard the story of Jeff Lawson at Twilio. And Jeff Lawson was looking for a startup to start. And that was similar to us, where we had two criteria in mind, my co-founder and I are small. And we said, look, we want a very large category that was undisrupted, that we can make a difference in. And our other criteria for starting a startup is we want to build a great company that really reflects the culture we want to have. And so for that first one, we looked at the Learning Management System category against 600 competitors, but they were all pretty bad. And the category is almost infinite, from the standpoint of, hey, anyone who is working needs to learn and train for their job, right? And so we said, hey, that fits our criteria, crappy competitors. It’s a huge market, and we can make a difference in it. And then the second criterion was that, hey, let’s be thoughtful about what’s the company we’d like to build. Because when we came from our previous company box, the one thing we learned there was that people enjoyed working there not because they had a love for file sharing, right? They loved it because there’s just a great company and culture to show up at every day. And so we thought that was a big part of, hey, we want to go do this for the next couple of decades in our life. Let’s start a great company around that at that first point, which is the category of the problem we want to solve.
Matt Watson 06:33
So when you were looking at the category, you mentioned there are potentially 600 competitors, or whatever it is, like, I think that’s a good point for people to understand. Because usually in most markets, there are two or three, right? You have Slack or teams, you have Coke or Pepsi or whatever, right, like in a lot of different verticals. And if it’s highly fragmented, where nobody has more than 1% of the market share or 5% of the market share, there is a potential for somebody to come in and maybe do it better than everybody else. And that was the opportunity that you were keen on.
Ted Blosser 07:06
Yeah, that’s totally right. And we actually wanted to use the resources we had to our competitive advantage. If you the Tristan Walker, who I forgot the company name he did, he did. The consumer product is coming as a sole to P&G., But he gave this really good example of, like, hey, when you start a startup, do things that you have a competitive advantage on. And what we had a competitive advantage on is we thought, hey, we could raise venture capital. Most of the 600 competitors did not raise venture capital. And we could, at that time, hire really good Silicon Valley talent. And then lastly, Arshad, I knew of SAS really well because we just came from a box, right? And so we said, You know what, looking at the 600 competitors, most of them were kind of mom, I would call a mom and pop SAS companies, Legacy providers doing it as a lifestyle business. Very few of them had actually raised venture capital and said, hey, I can go build a high-growth company around this. And very few of them were actually based in Silicon Valley. And so we said, hey, let’s take those competitive differentiators. Package them up and let that be a differentiator in launching the market. And it took some time. But once we did that, and we got a bunch of more key customers on board, then it started to snowball into a successful company.
Matt Watson 08:27
So why did you think early on that you’d be able to raise VC money where most of your competition hadn’t? Like, what gave you that?
Ted Blosser 08:35
Yeah, it’s funny. There’s a nice nuance that even though I did say, Hey, I thought we could raise it. So we were overconfident. We could raise it heading into starting the company, we’re like, oh, yeah, we’re in Silicon Valley. We came from a box we think we’re awesome, right? And what was really funny is that we were so very experienced when we actually went on the fundraising trail. To start, we got so many noes, like we got dozens and dozens of noes out of the gate, and we literally stopped fundraising because I was like, I don’t think I could get this done. And so, actually, our initial hypothesis was wrong. But we then luckily got into Y Combinator, you know the Harvard of startup accelerators, and no joke once we, once people heard we got in, like the day after we got in, all those investors that were saying no came back kind of banging at the door say hey, how can we invest is kind of funny. How much air to cover a program like that?
Matt Watson 09:33
Yeah, now that the herd feels like it’s safe, all of a sudden, you know that you didn’t have to finish Y Combinator, so just as soon as you know, like artists literally got in, we got a cold call that we had a really well-known investor.
Ted Blosser 09:41
Symbol Shaw from Haystack just cold-called R, and he’s known for just kind of finding startups almost out of thin air, and he has a great track record. He did Figma as an example. Recently, he did a hop and a few others. But he basically cold-called us on our support line, like, hey, I heard you got into YC. Tell me more about this. And he’s one of our earliest investors.
Matt Watson 10:12
So before he joined YC, did you guys already have the product in the market and had customers and all that kind of stuff? Or like, Where were you on the stage?
Ted Blosser 10:21
Yeah, for sure. I’ll rewind back a little bit. So we started WorkRamp in late 2015. As I remember the day, September 22, when we incorporated, and we essentially spent a good six months getting our first few reference clients, I would call about five to 10 customers using the platform while I talked about not being able to raise that was about three months in, we had a couple clients, about three months in, I was like, Hey, I think I could go raise on this, I think we were about 50k AR at the time. And that’s why I went to pound the pavement and just had no luck. And then, we apply to YC. That spring, and ended up getting into YC. That spring. And then the class started, I think, at the beginning of June. And once we got in, we were roughly I think about seven, and the ADK ARR grew a little bit. And then we’re kind of off to the races in terms of fundraising going through YC, and really getting into the harder part of our startup journey, startup journey. But we were able to take that momentum with YC and use it to raise our first seed round of about $2.2 million.
Matt Watson 11:31
So how hard was it to get into YC? Because I would think for the same reason that all the investors said no YC would potentially say No, on even letting you in. Right. So how was the journey of actually getting into Y Combinator?
Ted Blosser 11:43
Oh, man, that’s such a great story. So we were kind of stubborn about why Sia, you know, I was a little bit older at the time I was 31. Now I’m in my late 30s. And I told my co-founder ours, I was like, I just feel like we’re too old. I have a kid like these who are all young 20 somethings like it’s probably not for us. And he’s like, You know what, Ted, let’s just apply. So like the night before the applications were due. And I’ve been rejected from YC, maybe two or three times earlier in my life, I can’t even keep count. And so I just like asked, just not even worth it. So he talked me into submitting an application. He’s like, I’ll write it. So he writes himself. Probably a pro tip to have the CTO write it? Because the CEO adds too much fluff. Yeah, so he writes the application. And the funny part of the story was, we record the video, the mandatory video, you have to record some one minute YouTube video, you have to record. And when we’re recording, we’re like, Ah, it just doesn’t seem like cool enough, or enough hype and LMS sounds really boring. And so like, you know what, let’s just say we have AI in the platform. So now, we know nothing about AI. We’re like, you know, let’s just toss in AI. And so we were like, Hey, we’re the first AI based LMS on the market. So we make it all up, we get the interview. And so my co founders freaking I was like, Oh, crap, they’re gonna ask me about AI. So he spends like, two weeks building a prototype, night and day, and he actually has a working prototype that feels like AI. And he gets it working. And we got into the actual interview, they didn’t ask us anything about AI. They didn’t ask us to demo it. So my co-founder was tired and like, like, could barely stay awake. But we ended up nailing the interview and getting in. So that was a fun story that was totally unexpected.
Matt Watson 13:35
So does the product have any kind of AI in it today? Like leftovers from that?
Ted Blosser 13:40
You know, it’s funny now chat, GBT, we might need to put that in there. But I’ve had a few vendors actually pitch us on putting in chat GPT into it. But um, we don’t have any official AI, but I do see it. I mean, to be honest, I do see it coming down the pike in two to three years actually into the product. I think there’s a lot of cool use cases, mostly because our platform is a heavy content creation platform too. So there’s some really neat stuff you can do. But at that time in 2016 Open AI was not really I don’t even know if they’re around at that time itself.
Matt Watson 14:14
So you mentioned the use cases. So we’ve we’ve talked you know about the learning management system and stuff like that, but I think it’d be great to hear a little more detail on you know, a case study of like one of your customers that uses the product and how they use it, how it benefits them just so people have a better idea of you know, who your target customer is and stuff.
Ted Blosser 14:33
Yeah, for sure. So, I’ll talk through a couple of case studies. One, let’s talk on the customer education side. So on the customer education side, this is like a SaaS company, training their own customers, we have a customer called Quantum metric quantum metric has the ability to in their product. If you look at a lot of those dropdowns you would have a Help site, you would have your air Feel free to submit support tickets, and then you have an academy or a university. When you click into that the user expects to learn more about quantum metric. When they click into that they actually get landed onto a hosted page based on white label page on quantum metric University. And they could do deep dive tutorial certifications, when they get certified, they can publish it to LinkedIn. And they can basically build this viral loop around education around their product. And so that’s a really cool use case on the customer enablement side, where you can actually just enable your customers to be more proficient in your products, and then also help save them from things like churn or low engagement as well.
Matt Watson 15:47
But the key to that is quantum metrics had to create all that content, they had to create that certification program, they still had to create all that, right, like you’re just providing the technology to enable the delivery of the content, you guys don’t create the content, right?
Ted Blosser 16:00
Actually, we actually have the secret sauce of our platform. And this is when you talk about that startup journey in the differentiators with the 600 competitors is most of them, you would think are like that. It’s like, Hey, you just import the content, like a video you made or, or what we call a SCORM. File. And the education industry is a prepackaged kind of learning artifact. Okay, we did something different if we actually allowed customers to create content on our platform. So think of a Google Docs of training content, so our customers can really easily spin up learning content. So we have the video editing capabilities, we have the ability to have open tax, you can have flip cards, test questions. So we have a whole WYSIWYG editor. So as someone who has no idea how to create training content can actually come into the platform, never be classically trained, and go knock out a course for a customer or internal stakeholder.
Matt Watson 16:55
So a lot of the competitive products aren’t, are not really document editors as well, they’re, you know, they’re not really designed for content creation. They’re just meant to host the content.
Ted Blosser 17:04
Yeah, not as much. And so we can do both, we can host content. Yeah. But our secret sauce is also creating content. And like a pro tip. And this is kind of like when you do your pitches with venture capitalists. What’s great is it creates great lock in in exchange for the value you give, right? And so and so venture capitalists will always ask, Hey, what why would a customer not jump from your platform to another? It will, because they create a lot of native content on the platform. And that’s the give and take, it’s like, hey, they can quickly create content. But yes, it’s gonna be native on the platform itself, which also helps reduce things like switching costs.
Matt Watson 17:42
Yeah. Well, I want to talk more about your journey after Y Combinator. But before we do that, I do want to remind everybody that finding expert software developers doesn’t have to be difficult, especially when you visit FullScale.io, where you can build a software team quickly and affordably. Use the Full Scale platform to define your technical needs, and then see what developers are available to join your team. Visit FullScale.io to learn more. So after Y Combinator, I’m gonna guess you guys were able to raise some money. But were you able to really ramp up sales? Or did you guys hit, you know, hit a wall there somewhere that was, you know, tough to figure out from a growth stress growth perspective.
Ted Blosser 18:21
Yeah, we totally hit that wall. Paul Graham talks about that. I think he originated the concept, the startup trough of disillusionment. And if you visualize a graph, imagine exponential growth when you start in excitement when you start your startup. And then right after you launch, or get that TechCrunch article, you kind of fall off a cliff, and then you linearly grow your startup after the fact. And that’s exactly what happened to us. We graduated YC, I think we were we were listed as like a top 10 company to watch on TechCrunch had a nice launch raise that 2.2 I talked about earlier from some world renowned investors like Alexis Ohanian, Joe Montana, Gary tan, and a few others, and Susa ventures as an example. And then, and then what happened was, we just like lost the momentum, we hit every challenge you could think of, we weren’t growing fast enough. We didn’t really have to go to market fit, which we could talk about in a little bit. We had great team members, but also we had made some hiring decisions and people joined us who probably weren’t ready for the startup journey yet. So we had those challenges. We didn’t really have a culture defined. So just pretty much every mistake you could hit in the book, which I call it the wandering the desert years back half of 2016. All of 2017 first half of 2018 very challenging times turn through, employees turn through customers. It was a tough time, and that was really mentally taxing. Hang on, we probably could have almost killed the company if we hadn’t persevered mentally during that time.
Matt Watson 20:07
And so you don’t think any of that had to do with the product? It was more your go to market strategy.
Ted Blosser 20:13
I think it was the combination of the two, I think one kind of begets the other, it’s like we just weren’t growing, I think that’s the ultimate thing it was like, we just weren’t growing at the expectations of a venture backed company. Yeah. Right. And so then that causes a lot of discontent with the team, with how you operate together, how you even decide on building things. And so ultimately stem from low growth, like it was just like, hey, if the growth is not there, on the startup journey, that’s almost the number one thing in the early days, right? If the growth isn’t there, it will pretty much squash anything else you’re doing. Like, you have a great team, but the growth isn’t there. It’s gonna make everything really hard. And that’s essentially that, that trough of disillusionment, just the growth wasn’t there.
Matt Watson 20:57
So what did you guys do to get that growth going? What was the thing you had to figure out?
Ted Blosser 21:01
Yeah, that was really what I call the journey to go to market fit. And what was interesting was, we were in an existing space. So we didn’t do anything like category creation, our space was well defined in the LMS category, you could literally sign up to a competitor product and know exactly what you need to build and how to improve on it. So that was never the issue. We were building the product in the right way. But we didn’t know who to sell to like on one given day. I was selling to a trucking company in Chicago, I was then selling to a nursing company in New Hampshire, I was then selling to a biking company in Ecuador. And then on the same day I was doing on site at Square to sell to their sales team, right. And so it was just this hodgepodge of customers and personas and use cases. And it made it really difficult for us to hone our pitch, or even know what features to specifically focus on over time. And so it took us that time to 26 and mid 2016 in mid 2018, to really figure out what’s the persona we should sell to and we looked at the data, we looked at the anecdotal conversations we were having. And we said, You know what, the way to do this is we sell to a specific target under 250 or 300 employees. And let’s sell to sales teams. And let’s sell to tech based in SF. So we had a really specific, and there was a way that we could actually land into accounts, and then grow our brand over time. And that was the secret sauce was getting to actual a specific niche of customers to then get momentum to then expand to our long term platform vision.
Matt Watson 22:39
Well, and so this is a common problem. A lot of startup startups in one of my previous companies have the same problem. It’s like when you’re trying to sell to everybody, you’re almost selling to nobody, right? It’s hard to get momentum in any particular area. And so for you guys, was an outbound sales that you were trying to do and trying to really focus the outbound sales on that criteria. Where before you were doing outbound sales, but kind of just all over the place, or, or were you guys doing more inbound sales? Like what was your like, actual, like, sales process look like?
Ted Blosser 23:13
Yeah, for sure. And I was doing a mix of both. But what was interesting was that the outbound was really where the global market fake did come from. So okay, what was happening those early days, we would do a mix of outbound hard, it was just it was just me, really. And I would go on LinkedIn, I call them LinkedIn days, I would just scour LinkedIn, in my network. And what was great about our category, your head is one intro away from the buyer, as usually a mid level to lower level buyer. So it’s not a big ask, you could go ask a friend who works with you who you work with before like, Hey, can you introduce me to your sales enablement, leader? And they’re like, Yeah, sure. That’s an easy and easy intro. So that was a lot of our outbound motion, I would say the majority of our initial customers were from there. But when we talk about some of the inbound, we invest a lot, and what I call empty calories. We were spending money on paid acquisition, like Capterra. If you’ve heard of that, yeah, I’m a little bit of SEM, as well. And we were getting some of this inbound, like I talked about, like that nursing home, that trucking company, those are all inbound off of these empty calories. And these empty calories would really spin your wheels or get you confused about your go to market fit because they were coming inbound. But in reality, you were basically hacking the system and hijacking their cliques. And they’re kind of landing at the wrong spot, ultimately, right? Although you don’t want to admit it. And so over time, we basically shed those empty calories. That is a heavy focus on outbound for that first, let’s call it 30 to 50 customers. And then once we got that rolling, then we came back and started investing in more inbound motions, but we built the back of the company off of outbound, and then eventually we built the back of the company off a really Great outbound team BDRs.
Matt Watson 25:03
Okay, very cool. So I think you mentioned before we started recording that, you know, the kind of zero to one was kind of a slow process. And then the one pass that kind of took off a rocket, you want to tell us one more about that?
Ted Blosser 25:20
Yeah, for sure. And they always tell us entrepreneurs like, Hey, don’t give up too early, right, because you might be right on the cusp. And, again, it took us about three years to get to that first million of ARR, three hard years that I just described, but only a couple quarters to get our next million. And then I think it is about a year and a half or two years after that to get to 10 million, right. So it’s a really fast uptick to go from one to 10. And the big difference was, hey, once we hit that go to market fit, everything starts to click right. Once it starts clicking, then the investors notice. And then for example, when we got 2 million Arr, we were then able to raise a round from our series, a round of 8 million from Bo capital. Then we took that and parlayed that into the business and hired our executive team, and started to invest more in the product. And that led to our B round, which allowed us to raise 70 million from overseas ventures. And so it’s a nice flywheel effect, once you start getting that momentum, right. And so I could talk more about the specific tactics of that momentum from one to 10. I think the big part is to notice that that journey is a lot like companies like UI path, or bill.com. Those early years can be hard doesn’t mean like, hey, like it’s it’s all doom and gloom, it might just be it’s a slow burn, to actually get to good product market fit or good market fit. And don’t give up before that, and then you can actually take off to the races afterwards.
Matt Watson 26:52
Well, I suddenly want to ask you about, as you talked about, in the early days, you struggled with, you know, getting to that first million and that first three years were kind of stressful, because growth wasn’t hitting the expectations that everybody kind of had, right? But do you feel like those expectations were a lot higher than they should have been? Or would it have been different? If you had been to a bootstrap company? Like you guys were bootstrap everyone perfectly happy? And that extra stress just wouldn’t have been there? Or do you? Do you feel like the team would have still been, like, highly disappointed by the growth?
Ted Blosser 27:27
That’s a great question. Actually, I haven’t been asked that maybe ever or in a long time.
Matt Watson 27:33
I mean, basically, it’s like the, the VC part of it adds so much extra pressure, that if you hadn’t raised the VC, like, maybe you guys would have been super happy with the growth that you had and the success that you had, but it’s like, the VC part of it kind of just really, you know, added the multiple layers of stress on top.
Ted Blosser 27:51
Yeah. You know, I think there’s two ways to answer that question. The first as a founder, I was just talking to his founder yesterday. It’s really good advice as picking his brain on his new company. And he said, he said, Ted, you need to know in your heart of hearts, like, what do you want out of the company you’re building. And it depends on every person, right? And also stage of life, like, hey, if I said, Hey, I want to build a company that generates a lot of cash and have that and actually grow my wealth through the through the salary I take from the company, that’s a much different version to a person who says, hey, I want to go ring the bell, right now stack. And this has to be a venture backed company. Right? And, and so when we started the company, and even to this day, my motivation is really, if I had to sum it up to be a successful entrepreneur. And when I say, in those terms, for me, it means Hey, ringing the bell. For Warcraft, right is Hey, taking this IPO. And so again, it’s a lofty goal, but it’s the goal that I’ve set. And so with that, that then forces you or to your audience, this forces you to think through, Hey, what are those pressure points and be very honest with yourself about how you want to build a business. And so what was really good is those outside factors, adding stress actually forced us to work harder, work smarter, hire the right people to raise venture capital, which was really stressful in most of those scenarios. And so what I what I like to say is that, hey, if you choose how you want to run your startup and to use those pressures to accelerate your momentum, Ford, right, and even even to this day, it’s like, Hey, we’ve now raised Series C, investors expect you to go public at some point or at least have a big enough outcome. And so that adds pressure on how you run the company, you will run it in a different way, compared to let’s call it a bootstrap startup right now, too. So, yeah, it’s a great question, though.
Matt Watson 30:12
Well, so I, when we started the conversation, you said that one of your advantages that you guys thought you had was that you were in Silicon Valley. So fast forward several years now. Curious, what do you think about that now? Is being in Bali still an advantage? Or? I mean, it looks like you’re recording the podcast and nobody can see it. But I can see it maybe from your house? How many of you guys went remote? Like it’s a company now remote? And not really in Silicon Valley anymore? Or just kind of curious?
Ted Blosser 30:43
That’s exactly right. So I’m personally in Silicon Valley, still, I’m in Redwood City. And we did move 100% remote, actually, recently, and during COVID, we were technically hybrid remotes and still had our office and a great office in SFO, we just got rid of it. And we’re officially 100% remote now. And now I almost frame it as, as I’ve changed my mindset of, of, hey, you can, you can hire from anywhere now. And you can run remotely, and our company is fully remote, but mostly in the US, I would call it and I think it’s 95% in the US and Canada. And the difference though, is we still have a Silicon Valley ethos and mindset to growth and building the company. And so not to say, hey, everyone we’re hiring is around in California, it’s because we have people everywhere. But it’s more around, hey, we are using the best practices from Silicon Valley venture companies and applying them into the company itself and how we operate. But the people can be from anywhere, right? We have, we’ve done a great job hiring across the country, as an example. Talk to your engineering talent. I think you hire talent from all over the world. And we’ll probably do that eventually. But right now, we’ve just done a really good job hiring from anywhere. But then having that ethos from our original Silicon Valley roots.
Matt Watson 32:10
Well, as a follow on question that you mentioned, like being able to hire Silicon Valley engineers. And as a software developer, myself from Kansas City, I would never in a million years want to hear from a software developer from Silicon Valley, because they want to get paid twice as much money, which to me, I can’t fathom. So I’m curious if your opinion of that part of this change has changed over the years.
Ted Blosser 32:34
Yeah, that’s actually interesting. And I think the world will change even more before eyes with obviously the economic downturn. I would say our PE philosophy has been, let’s be in the 75 percentile of tech companies and keep an eye on that. And it doesn’t really matter the location. So we actually, for example, have equal pay regardless of location right now. Okay, we just want to be in that 75th percentile of comparable, let’s call a Serie C companies. And we also try to compensate well on equity too. So you bring up a good point, but that might evolve in the future, right? That’s historically what we were doing over the last two to three years. So we can hire someone in Kansas City at Silicon Valley rates, right. But we did find a lot of the value in those hires. But I could see in the future where even companies like us get more creative, maybe supplement with an offshore team, or maybe hire more internationally at a reduced rate. I think everything’s on the table. Now, as all these tech companies, including us, are reevaluating their expenses, their cost structure, their r&d structure. I think it’s all on the table. But historically, that was really our philosophy.
Matt Watson 33:56
What I’ve, I’ve just always found to be an interesting conversation is, you know, a CTO and a business owner. And because I always felt like I was hiring developers and Silicon Valley, of course, they’re like, 40 to 50%. Moreover, they’re not twice as much 30, 40 to 50% more, but also felt like, at best, I’m hiring the people that are the leftovers from like Google and Facebook and Apple and all these places. And, you know, it’s hard to be the cool company to work for. They’re like, you know, you’re not the cool company where if you come to Kansas City, you can be the cool company, like work RAM could be the cool company. And you can stand out from the crowd, right? Yes. Versus in Silicon Valley. That’s probably impossible, right? You’re never going to be the cool company, because there’s always going to be Twitter and Facebook and Apple and Uber and all these different people.
Ted Blosser 34:42
Yeah, and this is one thing I learned early on when I talked about how we rotated through people in the early days, and it’s not to their fault at all. It’s actually more around. We’re talking about market fit. There’s an employee market fit right and one big thing we learned in our hiring Journey is to make sure people opt in. So actually, we don’t sell people hard. In our recruiting process, we need people who are like, Hey, I do not want to go to Google, I want to go to this early stage startup, because that’s where I fit in. That’s what I want to try. And that was a big learning as hey, you’re probably not chasing after the thing leftovers. You’re chasing after people who maybe just were the top engineers at another YC company that flatlined, and now they need another great YC company to join. That’s a perfect engineer, one of our top engineers is like that. Where we were one of those engineers from another YC company, who we say, hey, let’s get you a new home.
Matt Watson 35:42
And he’s been amazing here at workarounds. I actually kind of find it funny to look at the resumes of developers that worked at the fang companies, which is like Facebook, Apple, Amazon, Netflix, Google, or whatever it is what that stands for, people don’t know, I didn’t even know what that stood for, until a few months ago. But it’s funny to look at them like they did at Google. And they’ll be like, I made this one thing. 10% faster. And I added this one button at Facebook news feed or some crap like that.
Ted Blosser 36:12
And it’s like, that’s all they did in like, one year was like, totally, but they probably got paid half a million. Oh, yeah.
Matt Watson 36:17
But yeah, but and to that point, though, like, I would much rather actually go work at WorkRamp and like, build something like actually create something, not add the like one little feature to the Facebook newsfeed or whatever.
Ted Blosser 36:26
Yeah. So yeah, and that’s the value prop in our stage. Yeah, absolutely.
Matt Watson 36:31
I’d much rather work for you guys, you guys would be way cooler in my book. But there’s a lot of developers that do get attracted to the fang thing. Well, if you do need to hire software, engineers, testers, leaders Full Scale can help we have the people in the platform to help you build and manage a team of experts. When you visit FullScale.io. All you need to do is answer a few questions and let our platform match you with our fully vetted, highly experienced developers that Full Scale, we specialize in building long term, long term teams work only for you to learn more at FullScale.io. Well, this has been a great conversation. And, you know, it’s always cool to talk to people who have been through Y Combinator and the whole VC gamut Silicon Valley gamut, like it’s definitely different, totally different than the, you know, the Kansas City vibe.
Ted Blosser 37:15
Totally, for better or for worse.
Matt Watson 37:18
It’s just different. You know, like, my first company, I bootstrapped the entire way to doing 35 million a year in revenue as a SaaS company. Wow, amazing. I’ve never raised a single dollar of an investor or of institutional funding, you know, we financed it with Visa and MasterCard, you know, that is also, you know, there are different paths, right. But that’s what Silicon Valley is famous for, as you said, the ethos of that path. And so as, as we round up the show today, I’m curious if you have any, you know, final thoughts, tips, you know, words of wisdom for other entrepreneurs out there.
Ted Blosser 37:56
Yeah, to your last comment, just close with what you just said is given we care so much or care so much about learning. We always learn from others about the different types of Journeys you can take as an entrepreneur. So like, even yesterday, I just reached out to that random founder who actually took a slightly different journey. He was on this kind of fast VC path and then went bootstrap, and he’s now back on the VC path, is learn from others what they’ve done and trying to get a myriad of experiences from people who are like yourself who have bootstrapped all the way to people who are running unicorns all the way to the public, right? Founder, public co-founders, right? And get all those perspectives because you don’t know where life’s gonna take you and use that to basically influence the decisions you make. And so I think all the journeys are great, and they’re all different. And the key is, don’t keep the blinders on. Always ask and learn from others through this journey because you will pick up tidbits that you can apply and actually know that, hey, I could fall back on this route. Or maybe I should push harder and go for this other route. Great, great way to continue to improve as an entrepreneur.
Matt Watson 39:04
That’s a great tip. And so many entrepreneurs, we don’t know. I mean, to me, that’s the bottom line. We just don’t even know what we don’t know. And having mentors and advisors is so valuable. So hold it. Well, once again, this was Ted Blosser from WorkRamp. Their website is WorkRamp.com. For those who are listening, please, also you can join our Facebook group on Startup Hustle chat. You can find us on Facebook. It’s a great group. You can also find me on TikTok and Instagram and all these places. It’s Matt Watson KC or on LinkedIn. So, Ted, thank you so much for being on the show today.
Ted Blosser 39:43
Matt, thanks for having me. I’m excited that we could finally do this.
Matt Watson 40:04
All right. Thank you, sir.