Online Marketing for SMBs and Digital Agencies: Serving everyone serves no one (episode #152)

The total addressable market. TAM.

We sometimes think the bigger the better, right? Hey, it means I can go to potential investors with a more impressive number.

But too large a total addressable market can hinder success. As this episode’s guest says, “serving everyone serves no one.”

To hear the story behind that lesson, and many more lesson-filled stories, I talked to Itai Sadan, CEO & co-founder, Duda [https://www.duda.co/]. 

Duda has raised $100 million, including most recently $50 million in Series D growth funding. Sadan manages a team of 180 people at Duda.

Lessons from the things he made

• No one needs to give you a mandate (even in a big company), just find your customer’s problem and solve it for them
• Crank through it
• Evolve your product over time to land on the right idea
• Speed in decision making is very important
• If you are feeling the pressure, it means that you are not applying enough pressure
• Solve the right problems for the right customers…serving everyone serves no one

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Discussed in this episode

Open-Source Start-up Marketing Strategy: Sometimes you need to poke the snake (podcast episode #147) [https://marketingsherpa.com/article/interview/open-source]

Time To Value: 3 speed-to-value marketing case studies featuring A/B testing, value focusing, and niche ad targeting [https://marketingsherpa.com/article/case-study/time-to-value]

Entrepreneurial Resilience: Many of the day-to-day annoyances that inspired him to sell, he actually missed after he sold (podcast episode #78) [https://marketingsherpa.com/article/interview/entrepreneurial]

B2B SaaS Marketing: No progress after Series A without product marketing (podcast episode #148) [https://marketingsherpa.com/article/interview/B2B-SaaS]

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Transcript

Itai Sadan: When you're feeling the pressure, it means you're not asserting enough pressure. So many times as a CEO, you are feeling. You're feeling the pressure of maybe not, a really important exact or employee leaving the company or, and what are you going to do now? Or you're not hitting your quarterly? Never, revenue numbers, or, you know, just different, different problems.

And it accumulates and you feel like people are pushing you almost to this, like people circumstances are pushing you to this edge. And I think the point here is when you're feeling that you're being pushed, it means you're not applying enough pressure backwards.

Intro: Welcome to how I made it in marketing. From marketing Sherpa, we scour pitches from hundreds of creative leaders and uncover specific examples, not just trending ideas or buzzword laden schmaltz. Real world examples to help you transform yourself as a marketer. Now here's your host, the senior Director of Content and Marketing at Marketing Sherpa, Daniel Bernstein, to tell you about today's guest.

Daniel Burstein: The total addressable market. Tam, we sometimes think the bigger the better, right? Hey, it means I can go to potential investors with a more impressive number. But too large of a total addressable market can hinder success. As my next guest says, serving everyone serves no one. Here to share the story behind that lesson and many other lesson filled stories.

Is it? Hey, sedan, CEO and co-founder of Duda. Thanks for joining me. It.

Itai Sadan: Thank you. Great to be on your show. Looking forward to, chatting about a lot of things related to marketing.

Daniel Burstein: Great. Well, let me tell the audience a bit about your background. So I'm listening to you. It has been a senior software engineer at Amdocs and director of service innovation at SAP Americas, and for the past 16 years, he's been at Duda. Duda has raised $100 million, including most recently, $50 million in series D growth funding. And ETR himself manages a team of 180 people across the company.

So give us a sense. What is your day like as CEO and co-founder?

Itai Sadan: Yeah. I first of all, I wake up in the morning. I live in Boulder. One of the things I like to do is, get my cup of coffee, sit on the sofa, watch, the flat irons, which are the big mountains here in in Boulder and, and I kind of calm myself down and look at those mountains and say, you know, they've been here for millions of years.

So whatever is going on in the company right before, as I open my inbox, you know, we all have our problems, our challenges, but it kind of grounds you a little bit to know that, you know, whatever the storm is of today or, it's there's there's always going to be something else the next day. But those mountains are always there.

So it gives you this kind of sense of stability. So I like to do that in the morning and kind of drink my coffee as I, start to go through my slacks and my inbox. At a certain point, depending on my meetings, head into the office and, and then kind of my day is really usually packed, with meetings, either internal meetings with, employees.

Sometimes, you know, a lot of, external meetings with customers, partners, and then, you know, try to head back home, spend time with the family somewhere between kind of 4 to 5. Be there when the kids come back from school, all that. And, yeah, I usually kind of log in a bit later and, get some more, some more stuff done in the evening after, kids are down.

Daniel Burstein: Well, that's a great lesson for all of us. Take a beat in the morning, look at something eternal. And, yeah, it's. Remember, get some perspective. I really like that.

Itai Sadan: Absolutely. All right.

Daniel Burstein: Let's take a look at some of the lessons from some of the things you made. As I mentioned before, I've never worked in any other industry. I've never been a podiatrist or an actuary or something. But I feel like in marketing we get to make things and that's that's what makes it fun. And your first lesson comes from working in a big company.

We'll get to some start up lessons. But this first lesson in a big company, you said no one needs to give you a mandate even in a big company. Just find your customer's problem and solve it for them. So how did you do this? Absolutely.

Itai Sadan: Yeah. So yeah, I was I was working at SAP, as you said, for a while, and I was, I was there in kind of more on the professional services side, working with some really big, customers of SAP. And I noticed we were wasting a lot of our time on setting up hardware and setting up software and configuring the software, and very little time on what we actually wanted to prove to the customer in POCs.

And, and, and so forth. And I said that that doesn't make sense. I kind of got this idea of let's create kind of an sap in the box where we bundle hardware. Like I got some partners, IBM, Fujitsu, and HPE to kind of provide the hardware. I got different teams, to volunteer and install their SAP software on that box.

And surprisingly, we sold these boxes to our customers. So this is a very unique position. Maybe only some of the biggest companies can actually sell, proof of concept boxes. But the reason why customers bought it is because it saved so much time for them. And, they would basically buy by using these boxes, you would kind of pass through them through the installation configuration, and you could kind of focus right away on building a business case and integrating the software with, you know, with whatever the company wanted to do.

And we ended up selling about 3000 of these, boxes, $10,000 each box in, in a matter of like a year or two. So it was a really good success. Salespeople loved it because if put like hardware and software at the fingertips of our customers. But I think the lesson learned here is that you do not need to get a mandate from anyone to build something, even inside the biggest companies you can, you know, identify.

And this is really the entrepreneurial journey. You can identify a problem, a pain point that your customers have and try to solve it and get people inside the company to see the value because you're helping them do their job better. You're helping salespeople put the software at the fingertips. You're helping product people get their software out. So everybody wanted to contribute to that project, even though it wasn't mandated by anyone.

And eventually, for me, I kind of saw how it was. That was like pretty cool to build something like this. It's almost I built a startup inside a bigger company, and eventually I said, why? Why don't I leave, you know, SAP and do my own startup? And so that was kind of, yeah. The lesson learned there.

Daniel Burstein: Well, let me ask you about that first step out of step to build your own startup. And what if people listening right now, if they're working at a big company, what's one of the first 2 or 3 things to get the ball rolling on your on startup? Because when you mention, okay, I'm working at SAP, I could do it myself.

True. But you're working in SAP. You've got so many resources, right? Budget all of these things. And then when you step out on yourself, I mean, for me, when just I worked in starting a small consultancy, it was like, oh, wait, insurance, health insurance and oh, like taxes and accounting and all these things I never thought of before.

So I think when we go from a big company, we want to start a company. Yes, we have that subject matter expertise that we are expert in and that's what we're actually wanting to build a company for. But there's so many of these different factors to actually start a company. So can you give us a sense of first, maybe step or two to actually, yeah, step out of SAP and start a company.

Itai Sadan: Right. So the first step is actually not to step out. I think the first step is actually to come out, come up with ideas, and test those ideas out for as long as you can while you're actually working in a bigger company. Now, I'm not recommending to use, you know, you need to use like your nights, weekends, do it on your own resources.

I'm not recommending, you know, use the time that you're actually supposed to be working for your, for your, main employee. And, you know, me and my co-founder, we did for a while. We build due to for a while on our nights and weekends while we were employed. That and why is that important? Because even before we do that, we probably had hundreds of different ideas because we kind of want you.

We wanted to do something, and it takes time to kind of, you know, make sure that the the idea is worthwhile, because if you leave, I think too early. What will definitely kill your startup is if you're not funded and you know you need to support a family and you're running out of, you're running out of cash, that's definitely going to kill your idea.

So being sure that the idea actually has legs of its own and that it's something that is worthwhile leaving your current employer is is an important one. And I and I remember like we thought, hey, even the even the idea of, dude, you know, we'll start working on nights and weekends and, you know, maybe we'll leave SAP in two months and get some funding.

It actually took a year and a half of like, nights and weekends until it got to a place, where it was big enough and we were sure about it. And we had investors interested in funding it. And we had a big customer, AT&T, which was, the first, customer that was willing to pay for it, which is another topic we can get into, very soon.

I think it's it's a pretty interesting one.

Daniel Burstein: You know, let's talk about how you got to actually getting funding. I mean, the lesson you learned, you said to crank through it, which hearing you talk about the nights and weekends and all that work involved, and, you know, you hear about the entrepreneurial journey makes sense. How did you crank through it and ultimately get to that funding?

Itai Sadan: Yeah. So it was it was really hard. We were it was like 2009 after the 2008 crash. You know, investors were not in in the mode of investing back then. And Amir and I, we were going out and talking to investors. We talked to tens, you know, 20, 30 investors. And we were not getting any, any traction, any anyone who was interested in investing in this idea.

Again, we were still working at SAP. But there was already, you know, a beginning of a product out there. There was definitely a clear idea. And, you know, we had and maybe we had some, a few small customers. And I think the main thing was that there was not enough, what what investors called traction.

They'd like to see the traction. So we all think VCs like to take risk. And they do take risks, but they take a very calculated risk. And usually and I tell that to a lot of startups that I, that I am, that I advise is you you need to be able to show the traction. So if you're going after small businesses, you need to get to a very serious volume of small businesses before a VC actually will fund you.

You need to be able to show that this idea that you have this product that you have has organic, organic adoption and, and be a small amount, a large amount of small customers are are, interested in. Now, if it's intended for big companies, then you have to have that big brand name that's also traction. And for us, although we kind of initially wanted the product, we, we wanted we built the product and we can talk about what the product was for small businesses.

The first big customer that came knocking on our door and, heard about it, was actually AT&T and subdivision of AT&T, which was called AT&T interactive. And they found a lot of value in it. And they wanted, they wanted to resell it. And I think the moment that we were able to get AT&T that, that that really triggered everything, that was the moment that investors suddenly, were interested.

We got term sheets. This is when we decided to leave. And gave our notice to SAP. So, you know, that that was kind of the, the, the moment for us. And the interesting story about, AT&T is that we were in negotiations with them for a while. And remember, I was this was still kind of during my kind of off time from SAP.

And at a certain point, we were actually negotiating a contract with them and someone from vendor management at AT&T contacted the product manager at AT&T and said, hey, I went into Ty's LinkedIn and you don't believe what I saw. He's actually working for SAP. Do you know who you're doing a deal with? So the product manager there, which I give him a lot of credit until today, said, well, if he tie in a mere build, such an amazing product while working at SAP, I'm definitely doing a deal with him.

So that's how I want to start.

Daniel Burstein: Now. That's awesome. We'll take us through to okay, so SAP, one of the biggest tech companies in the world right now. You're working at a startup essentially on the side too. Is there anything you did differently with your strategy at a startup than working at a giant like SAP? Because, for example, when I interviewed Margaret Dawson, the CMO of Cronus, for one of her lessons was, sometimes you need to poke the snake.

And she talked about when she was working at the smaller companies, right. She would have to kind of poke the bigger companies. And for example, Cisco, I think was one of her competitions. They were advertising Intelligent Network. So her startups campaign was keep the networks dumb, right. Poke in the snake. So for you, if you're working at SAP during the day, you know, it was it sounds great.

Giant budgets, giant brand, giant connections. Right. And then at night in the weekends, you've got this, you know, small startup people haven't heard of. Is there anything you had to do differently with your strategy, or is it just all the same serving customers?

Itai Sadan: No, it was totally different. And I think after a couple of years in SAP, working with some of the largest brands and seeing a little bit of the dysfunction where, yeah, you know, right hand doesn't necessarily know what the left hand is doing. You're talking, you know, things move extremely slowly. This is this is where I got a little bit of that, you know, passion to work with the small business.

You know, the small mom and pop shop, the lawyer, the accountant, the owner of the pizzeria. You know, you know that you're getting the closest to the person who's actually going to use your software. The person who owns the person who's going to actually pay for it if they see value, you're going to see a much quicker decision making.

And I love that because I felt like working with large enterprises. You were not, you know, you didn't get access to that level of people. And, you know, the pace was just a different pace, which I was really looking forward to working with.

Daniel Burstein: And you really impact people's lives, right? I mean, obviously, if you help us see them on a big company, that's great. But I mean, like you said, if you help that couple that owns the pizza shop, open two more pizza shops, that's transformative.

Itai Sadan: Absolutely. Yeah, that that's amazing. And I think it's a really important also another advice there for, you know, maybe people I was thinking about starting out. You need to know that, you know I've been building Duda for 16 years now. You need to know that you need to have passion for your customers. I've seen I've seen entrepreneurs build, start to build a business in an area where they just thought, oh, there's a huge financial opportunity, big time.

We're going to make a lot of money, but there's going to be a lot of grinding there. There's going to be tough times. There's you need to love the customer. You need to be passionate about working with these customers. So don't go into a space just because there's a financial potential there. You know, you need to be spending a lot of time with these customers, you know, learning, very deeply what you know, their pain points are what, you know, having hanging out in their conferences, writing about it.

So you you really have to have that passion for the space.

Daniel Burstein: Yeah. So let's get into what you actually serve the customers with and how you adapted that, the product itself, you said that you learned to evolve the product over time to land on the right idea. How did you do that?

Itai Sadan: Yeah. So it's you know, it's been a extremely interesting journey. Whatever you think you start a company around and the. And the problem, you're out there to solve evolves over time. Market dynamics change when we launched the product, it was really around idea A. Today the product has shifted a and it's a completely different product than what it was in the beginning, still in a very similar space.

So when we launched the product, it was really, you know, it was around 2010 iPhone came out in 2007, Android came out, 2008. Small businesses were struggling, to engage with, traffic users who came to their desktop sites from these months, from these newer smartphones back then. And we saw how companies like, you know, Amazon created, dedicated mobile site for their mobile users.

EBay created one, and it was very clear to us that, you know, small businesses didn't have the budget, the knowhow or the skill set, you know, to to build something like that. So that's what we initially set out to solve. We wanted to build take their desktop sites and transform them into mobile sites. And we created a super simple experience.

It was just give us the URL of your desktop website, click Submit all the magic happens behind the scenes and you get a mobile site that you can, you know, take it and publish it or, continue to customize. And that, I think, struck, a real pain that, small businesses had. And we grew that into, you know, a million sites in mobile sites in a matter of 2 or 3 years with partnerships with companies, like I mentioned, AT&T and Google and Yahoo back then and OpenTable.

So we had a lot of early success. But then about, you know, for five years in, the proliferation of devices happened. And there was people had, not just mobile, they had tablets and they had desktops, and they had a browser in their car and a browser on their watch. And it was clear that people didn't want to build, a dedicated website for every single device, more or less at the same time, a paradigm called responsive design that all of us marketers know very well started rising.

And we understood that we need to jump on that bandwagon, because what responsive design basically gave was the ability to build it once, and it runs on all these different screens. You don't have to build for a different screen. So we were racing to kind of take our product that was mobile. The company was mobile DNA, mobile first, mobile only at that point and kind of add these additional screens, through this paradigm of responsive web design, a lot of other bigger companies in our bigger CMS in our space, which were desktop first, were racing the other direction to add mobile.

Obviously, we met somewhere there in the middle, and suddenly five years into the company, we're like, we're with a product out there competing with, you know, public companies like Wix and Squarespace and WordPress. And for the first time, the the word differentiation came into our lingo. And the question of, you know, how are we different? Because before that we were just that mobile player.

So we were we were definitely different. And we and when you know what, when you're the leader and you ask me like, who's your customer? Right? The very basic question that a lot of a lot of entrepreneurs, have a hard time to answer the most simple question, who's your customer? It's actually a very difficult question to answer because it's never just one type of customer.

But we were looking, you know, back then when we when you're number one, you would ask me who our customer was. Probably the answer would be anybody who wants to use the software that that was the that was that's when you're the leader. You don't carry and you're going gangbusters. And you know, it's. But suddenly when there's fierce competition, then like the question of how am I different?

Why are people going to use me and not the competitors came, came into mind and as we're looking at our user base, we were seeing about 50% were these SMEs that we really built the software for, or that was our initial intention. And the other 50%, were web professionals, marketers like like you and I, you know, web designers, digital marketers, graphic designers, web developers.

And we were looking at the data and they're actually growing faster than, than, the SMEs for us because they were building multiple sites. And, you know, so the I think it's the DNA of a company, all our engineering is in Israel. We like to build sophisticated stuff because we were kind of being torn apart by these two types of customers where SMEs really wanted.

Give me the simplest way to publish something online. I want to just click a a few things, and I'm live with a website while web professionals want give me sophistication, give me powerful tools, give me flexibility. So it's it's it really tore the company into two parts addressing these two customers. And and we basically made that decision five years in that we are going to be a pro focused company.

So we actually we didn't fire the 50 other 50%, but gradually we changed our messaging to be much more, you know, agency web, pro focused, R&D, new started prioritizing features that web pros wanted. Sales people knew who they need to speak to. So it really morphed and took the company and propelled it forward, to where it is today, where we have, you know, more than a million websites and 22,000 digital marketing agencies using the software.

And I think if we wouldn't have done, I call it it's kind of a pivot, but it's it's more of a narrowing of your customer base to really hone in on the exact ICP. Right. Your ideal customer profile. I don't think we would be around being kind of this generic company that is trying to address everyone and do everything at the same time.

Daniel Burstein: Will take us through. So it sounds everything you said sounds good in theory, sounds good plan. Now how do you make it happen? So take us through as CEO, was there a specific step or 2 or 3 that you took the company through to pivot the value proposition? Because, for example, I mean, when marketers hear this, yes, they've got ideas for new messaging for finding that exclusivity, find the right customers.

But there's so many different elements involved. There's getting sometimes a board of directors involved, all the C-suite, as you mentioned, getting actually the people building the product on board, building the right thing, partners, vendors, all of these different elements that are involved when we do want to make that pivot in our value proposition. So as CEO, can you give us a sense of, you know, the value proposition workshops or there's all these different steps you could possibly take, what was a key step?

Or to actually get that whole company on board and align on pivoting the value proposition from what it was before to what you did after? Yeah.

Itai Sadan: Well, I can tell you it's definitely wasn't easy. Let's just start with the name of the company was due to mobile and that and me and my co-founder were coming in and telling the company, we're no longer doing just mobile. We're going to first of all, we're going to go fully responsive, and compete with some of these bigger website builders.

So that kind of was the first transition from being mobile to being, you know, a fully responsive website builder. And then after that, I, you know, we came and said, hey, it's you know, it's that's not enough. We really need to hone down on our ideal customer profile, which is this web professional. I think these changes, you know, it doesn't happen overnight.

It, you know, and you can't do it overnight, you know, especially when you're, you know, there's real revenue. Could be, you know, we were already making millions of dollars servicing small businesses and, and, and web professionals. So, you know, there's no way in the world where you can just, you know, cut, you know, 50% of your revenue.

So you have to transition over time. You also want to get some confidence around this decision. So it's it's a gradual change. I think, you know, initially when we came in, probably talked to the management team and persuaded them it was not an easy conversation. But it's really I think it's it's gradual. You talk to your management, you get them behind it.

You talk to your board, you prepare, you think about the communication. You, discuss it with the rest of the team, and eventually you get everybody on board, especially if it makes sense. And usually there are some or any challenges looming that people are seeing, right. Where, you know, we we started seeing at that time, you know, when we moved from mobile into full responsive, we started that we started people, seeing people and customers and partners asking about responsive web design.

So you can't put your head in the sand and say, you know, this change is not happening. You can't say AI is not happening. And I'm going to be just doing what I've been doing. I think this is a key, you know, a really important point here that this is first and foremost, this is the job of the founders.

You're you know, you're steering the ship, ensuring, you know, that product market fit, that the product that you're building fits with what the market is asking for is the job of the founders and and it and it constantly changes. So the fact that, you know, we had product market fit early on, we lost it along the way because market dynamics things change.

So you constantly need to make sure that, you know, the ship is aiming at the right, at the right destination and with the right coordinates. And, and then, you know, I remember, you know, until today, the, the arguing within the marketing team when you're introducing and it doesn't have to be a complete pivot. It could be introducing a new a new product.

Nobody wants to give it real estate on the home on the homepage. Right. Everybody's incentivized to drive revenue from the existing product. So you start with giving it a little bit of space and you start to see some traction. And over time, you know this. The second product takes 50% of the real estate. And when it's very, you know, by that point when it's 50% of the revenue, it's very clear and kind of you know, the initial product becomes legacy and the new product takes over.

But it's definitely, you know, a shift. And, it takes time. It takes persuading people, but you need you eventually you need to prove it with, with traction again, with showing customers are adopting it and growing and you know, the the were tough from a revenue perspective. There were tough times where, you know, about two years.

And I think that was more or less between 2014 and 2016 where, you know, our revenue grew like this for product A and it started kind of flattening and the topline revenue of the company was not growing for about two years. And we had this newer product, right. The responsive design that was growing. But it was still small.

Right. But still small. And it took almost two years where we got to that 5050 point in terms of revenue. And it was for, you know, for anybody internal who saw how the new product was growing at the pace. It was clear that this is going to be the future of the company. But it was not you know, it took time like we couldn't get in those two years.

We couldn't go out and raise more money from investors because, you know, overall top line was still flat. And so it was a lot of belief from the people inside the company. And that we're definitely in the right direction. We need to yeah. Put our heads down. Execute make sure the the newer product is the majority of the revenue.

And and then we continued, you know, raising more money but that at that point it was already clearly around this newer product that was the future.

Daniel Burstein: All right. Well, in the first half of how I made it in marketing, we talked about lessons from the things that we make like it. They talk about making a new product, making a new value proposition. But in the second half of the episode, we talk about lessons from the people we made them with because that's what we get to do.

We make things. We make them with other people. But before we get there, I should mention that the how I made it in Marketing podcast is brought to you by Mic labs, a I the parent company of marketing, Sherpa marketing Sherpa has teamed up with Mac Labs AI to produce a research study. And we are granting AI engineering vouchers to eligible companies.

Could be yours. Learn more at MC labs Aecom five K voucher. That's Mech labs.com, the number five, the letter K and the word voucher. Okay, let's talk about some of the people you collaborated with to build these things. You mentioned Oren Zev, the, one of your first seed investors and the founder of ventures. And you mentioned from Oren, you learn that speed in decision making is very important.

So how did you learn this from Oren?

Itai Sadan: Yeah. Already, I think from the first day that I met Oren, so this was, very early on, as I mentioned, just at that point when we were, very close to closing that deal with AT&T, it was pretty clear that that was, going to happen. And we already got a term sheet from another set of investors.

And then someone introduced me to Oren and, or, and wanted to invest. And I said, you know what? And I think, you know, we already have a term sheet, you know, I'm glad to meet you for coffee, but, you know, we're probably going to sign this term sheet that we got. So let's meet for coffee and see where it goes.

And over that coffee meeting, it was very clear to me that the value that Oren, is going to provide to the company is leaps and bounds more than the other investors who we had a term sheet with. And he basically said, if I can turn a term sheet and wire the money to you in 24 hours, which was unheard of because I conversations with other VCs took weeks and months and due diligence.

And, and this guy was willing to, you know, after a coffee meeting, was willing to wire money in 24 hours. And again, we we clicked we bonded, in that meeting. And I said, you know, I said, yeah, we'll we'll go with you. And, exactly as he said, 24 hours later, we had money wired into our account.

We signed contracts and it was done. And until today, this was 15 years ago. Oren is, a very close advisor and mentor to myself and to the company. He's on the board. I, I, I still stay in touch with him. We talk every probably every three weeks or so. So just showed me, like, back to your original question.

Like that, moving fast, especially when it's not common in this specific industry to move fast in the VC industry, people take their time, they do their due diligence. It's it could be a very significant advantage. And I've seen the opposite. Moving away to other examples of how moving slow kills deals. We, we we probably a lot of us know that.

But we've had deals that we worked on with customers, partners for, for months. And, you know, they took longer for different reasons. And as they take longer, executives and champions leave the company and suddenly strategies change and Covid happens and, you know, and financial markets change. So a lot of things that are maybe not directly related, but indirectly related to, to a deal, to a partnership could happen when it takes just too long.

So overall, the, you know, the recommendation is, you know, try to get things to happen as, as quickly as you can to so those unpredicted variables don't come into the picture and, sway everything, in another direction.

Daniel Burstein: So I want to ask about that speed loss in just a moment. I think we can learn a lot for our customers. But first, let me just unpack this. The story blows my mind. Okay. You had a cup of coffee and 24 hours had funding. I've never heard of this. How did boards and lawyers and other investors. How did.

Nothing to slow you down. The lawyers? How did they not slow you down for getting this funding in 24 hours? I don't understand.

Itai Sadan: Yeah. Term sheets are a it's a it's a very basic template. There's open source templates for term sheets. There's no need to negotiate. Yeah. At least series seed type of term sheets. We just he said find any find any term sheet that you have on, you know, like, let's just take something open source that a lot of smart people worked on, and we'll use that.

We don't need it. Yeah. Obviously, you need to just negotiate. Agree on the price, but.

Daniel Burstein: But I sent you the money within 24 hours. Well, that's the one.

Itai Sadan: That's crazy. This is this is one of his key. Key advantages. And he he just he's a one person venture capitalist, and that's what he likes. You know, he worked and he worked previously in other, firms where you need to drive consensus. You need to persuade other people. Right. It's not your decision. There's a deal. Team. He works alone.

He doesn't even have, assistant to to schedule meetings for him. He just does everything alone and that, and that allows him to operate really quickly.

Daniel Burstein: That is fantastic. But let me ask. Okay. The bigger lesson here. Now, how do we apply this to our customer? So I wonder if you take that same speed approach when it comes to customer onboarding. Because for example, when I wrote a case study about Talkspace, they tested an app activation flow to speed up things like videos or even something as simple as a loading bar animation.

And those tweaks led to a 60% increase in conversion. So I always like to look at these things that we experience in our personal life, like this speed to market with the super fast investor, to see how can we use this then with our customer. So is there any, any lesson you learned in terms of speed when it comes to onboarding?

Itai Sadan: Yeah, yeah. We we actually have, an objective that is, a company OKR, for our account managers. And, their goal is within every deal that gets signed, during the onboarding, they need to get the customer to build ten sites within three months. So we learned that, you know, and many times this onboarding requires integration.

So there's there's a bit of work that needs to be done, before you can actually go live. And what we learned is that customers who get to that number, to the ten site threshold are probably going to stay with you for the long term. Now, if you let the time lapse and you let you know, you let them move in the, you know, you just signed the deal and you let them do the integration on their own time.

And you don't put any pressure on that. Again, champions change, strategies change, they move and focus on other things. And and many of these deals eventually churn. But when you can get to that threshold that we've found is important for our company, and every company should find what it is for them. You have a much higher chance, of retention and success with that customer.

Daniel Burstein: Let's talk about life as a CEO. There is a lot on your back. I love how you mentioned just drinking a cup of coffee, looking at the timeless mountains, and in the morning to kind of relieve some of that pressure. But you said, here's one lesson that you learn and live by. If you are feeling the pressure, it means that you are not applying enough pressure.

You mentioned you learned this from Ben Horowitz of Andreasen Horowitz. How did you learn this lesson from Ben and how do you live it?

Itai Sadan: Yeah, yeah. So I did get to meet Ben, once, during one of our, series. I think it was a series B funding. They didn't end up investing, but I did have a really interesting conversation with him and it. And this specific, point around, it's that he made it. He actually wrote that in a, in his book, The Hard Things About Hard Things.

And it, and it's a point that really resonated with me. When you're feeling the pressure, it means you're not asserting enough pressure. So many times as a CEO, you are feeling you're feeling the pressure of maybe not, a really important exec or employee leaving the company or, and what are you going to do now? Or you're not hitting your quarterly?

Never, revenue numbers, or, you know, just different, different problems. And it accumulates and you feel like people are pushing you almost to this, like people circumstances are pushing you to this edge. And I think the point here is when you're feeling that you're being pushed, it means you're not applying enough pressure backwards. And, and many times I feel that that is the case.

So if I am being pushed by. Yeah, even a board member about, hey, like, you know, you guys are not doing this, you're not hitting your numbers, you know, it's it's it's okay to like to be really. Yes, obviously. Stand your ground. Explain what are the things that you are doing to to change the circumstances where what is the strategy going forward, how you will get the company out of the situation, where it is right now?

Yeah. That's just one example. I know this is something that works for me, that sometimes I feel like if I'm under a lot of pressure, it's because, you know, I'm letting the circumstances influence me and I'm not doing enough to impact the circumstances around the.

Daniel Burstein: Day when I like hearing that lesson. Because to me, when you really, if you break down a CEO's job, is one of the core function. Things must be setting the vision and navigation, making sure you're heading in that direction. And so if you do your point, you're feeling so much pressure. Maybe you know you're not setting the offense and saying the direction, saying we're here.

You get all these other voices in.

Itai Sadan: Exactly. I think that this is exactly the point. You're like too much on defense and not enough on the offense. I think that's a good way to put it.

Daniel Burstein: Yeah. But that also brings up part of the pressure is. So again the CEO sets that direction. Then it's got to get set, especially in a smaller company. I think part of the pressure comes to the workload too. So I wonder how you decide when and how to delegate. So for example, when I interviewed Rich Davis, the founder and chief creative officer of Think Spark, one of his lessons was don't look at delegating as a task, look at it as a skill.

And he told the story that he realized you really didn't have that skill. Very good. So that's what he focused on was improving that skill, getting coaching. And that was a real big focus for him. So he could actually get good at delegating because that was, you know, other than setting the vision, delegating is really a key thing for a CEO and a startup.

Sometimes you just try to wear all the hats and do it all. So as the you know, we talked about your at CPA, SAP or just doing it on the side of your co-founder, I'm sure you're doing almost everything yourself as you're growing the company. How did you decide when and how to delegate and how did you get good at it?

Itai Sadan: Yeah. Yeah. I think that's, you know, I like delegating. It is, I think where I feel like I am when you have strong people underneath you. The they do the job better than you. You do. And hopefully you're hiring the right people who are going to do a better job. And, you know, initially, as a CEO, you're doing a lot, especially in early stage company.

So you might be the salesperson, the marketer, even the QA person, or the engineer. And you need to give those hats away as the company grows. So you feel when you feel that there's enough happening where you're not doing a good job in any one of these fields. It is, I think it's very natural to hire someone and give one of these hats away to someone who would do a better job than you do, and over time, you're hiring enough people where you know you're left more with the strategy hat and the vision hat, and you have a strong CMll underneath you as strong chief revenue officer, a CTO who are taking care

of their things. I think what I feel is when I am getting sometimes too deep in a certain area, it is it is because the person who is in charge of that area is not doing a good enough job. So I think, again, my modus operandi is definitely delegate wherever I can. And if I feel like I'm spending too much time in an area, it's usually not because I don't want to delegate.

It's because the person who's role is it to do that job is not doing a good enough job.

Daniel Burstein: If that person is playing offense right, that we all, and it's not just the CEO, we all need to play offense in a sense, right? Or real feel the pressure.

Itai Sadan: But, you know, I think it's it could be for different reasons. Sometimes, you know, as company grows, people who are good in, in a certain stage, like bringing the company to 10 million, are not the right people to bring the company to 50 and 100 million, especially when their staff grows and they've haven't done that before.

So at any point, you have to assess the team that you have around you and see, you know, are they are they carrying their weight?

Daniel Burstein: Well, let's talk about well, all of us in here, you kind of mentioned it briefly before, but solve the right problems for the right customers. Serving everyone serves no one. You said you learned this from your co-founder, Amir Glock, who's also the CTO of Duda. I wonder if you could take us into your instance briefly before about how did you work with your co-founder to, I mean, make this a monumental decision, walking away from a customer base specifically to, as you just mentioned, as a company grows, you've got to get different skill sets to get to the next level.

You two started working very early in the process. So take us through kind of that co-founder relationship and how you two work together on such a momentous decision.

Itai Sadan: Right? Yeah. So, the interesting thing is that I know Amir, my co-founder, since high school, we went to.

Daniel Burstein: Yeah, working together as well. Or you were talking about that's.

Itai Sadan: Yeah. That's for us. Okay. So we we were started. We were we were at the same high school. We weren't friends back then, but we knew each other. And it so happened that both of us started learning computer science and mathematics in the same university in the same year. So that's kind of when we became, much better friends and, and eventually roommates, college roommates.

And after after college, he went and worked for a few startups. I went and worked for some other companies. Eventually he joined SAP, brought me into SAP to interview for a role he thought I would be a really good fit. I relocated from Israel to the Bay area, with SAP. I then brought him into my team, so we were kind of playing catch there, and eventually both of us were here at, in the Bay area working for SAP.

And, you know, that's the story we talked about before and, you know, left to start due to. So we know each other for a very long time. And, and I think that is the basis and the foundation, for, for for the company and the trust between us. I know that his decisions, he's the CTO, and runs the entire engineering product team I trust 100% his decision.

He trusts my decisions on the business side. We don't have to talk. Every day there. There could be a full week where we don't talk. We're very aligned, and I think we have very similar values, and we, you know, I don't I don't remember in 15 years of us ever having, you know, a significant argument, so, so, so we are really kind of two minds think alike.

He's really strong on the engineering side. I kind of shifted over time. You know, when we started the company. More from the engineering into kind of the business side. So we very, very much complement each other. And then I think we every once in a while, we, you know, we talk about strategy, we talk about the direction of the company.

We consult each other a lot, about different things. And I think things, you know, as I talked about before that, you know, product market fit, future strategy, product roadmap. These are, you know, I don't get into the weeds in the product roadmap. For example, I trust him, but we said we set the course, we set the coordinates together.

We'd say this is where we want to go. This is, you know, the future products that we want to build. Here's the opportunities we persuade each other that this is the right direction to take, that this could be ongoing conversations. And eventually, when we decide that this is what we're going to do, you know, we go and persuade the management team and then it cascades down and this and at the execution part of actually building the product, this is where I'm much less involved.

I'm kind of more involved in the decision making and the strategy we are going to build, you know, X and then I kind of leave it to him and his team to, to make that happen.

Daniel Burstein: Well the we are going to build X specifically. Also getting to how you switched who you're building that X4. We talked about changing that ideal customer. I wonder how do you get to actually really learn about know the ideal customer, how you can best serve them right. Because for example, when I interviewed Asaf Ra, VP of marketing in Agora, one of his lessons was, one of the most important things about a marketing executive is to know your market really well, knowing the actual people.

And one way he did that is you learn. He launched a podcast with his ideal customer, and he would be interviewing them to get them to know know them on a personal level. So you talked about this very big strategic shift from one customer to another. You also talked about, okay, you understood, obviously at the 30,000ft level, seeing the whole market dynamics and markets moving and all that.

But earlier you kind of briefly mentioned something I'm interested in. You said really care about me, passion about your customers and go to conferences and all these sorts of things. So I wonder if you can give us specifics about how you specifically or if it's you in a mirror, you and the whole team, how do you actually what things do you do to get to know that customer on a personal level, especially when you're going through this shift from, hey, it's going to be from one customer set to another, we're going to bet the whole company on this.

Itai Sadan: Right? Yeah. So I think there's, a lot of ways where you get, this deep and profound understanding of who your customer is and what they want. Starting from, you know, talking to your customers, I definitely have, you know, close the closer customers. Closer partners that I, you know, their, text message a way, a telephone, a way that I can reach out to them and we talk and, I, you know, I sometimes send them.

Hey, take a look at this product, this other company. What do you think? Is this interesting? Is this an area where, dude, I should get into, try it out and they might try it out and give me feedback in a couple of days. So definitely have some very close conversations with some of our closer partners. We have, this other thing, which is an idea board, where customers can come in, suggest ideas, features that they would want to see in the platform.

And, and, and then other, other customers can vote on it. And that's a very important, you know, source of information for our product managers. And I look at that as well. And, and this is how you stay attuned to what your customers are asking for, for. Right. Because if they come sometimes there's some good ideas and we'll talk about that can come from you internally, but your customers know best what they need.

And if they come up with the idea and then you say, hey, there's 700 votes because we have 22,000 customers for this feature, we should probably build that because all these people are, you know, voting, voting for it. And we actually also have an objective, around, taking like the product team has an objective around taking ideas from the idea board.

They need to reach a certain score. So for example, in a year, they need to maybe reach a score of 1000. And each vote is is considered one. So we are addressing the direct requests coming from, customers via this idea of board customers. And it's also nice customers feel like they have the opportunity like to influence.

And you can see customers telling other customers, hey, I just put up this idea if you care about it, there's all kinds of forums and stuff where they're trying to get others to to vote for those ideas. We do conferences where we get, we, we run our own conferences, one in the US, one in, one in the EMEA.

The next one is going to be in September in Amsterdam, where we're very close with our existing. We we bring our existing customers partners to these conferences and we get and we spend real time with them. We get feedback from our support team that is dealing with, you know, tickets and, and so there's so I think there's just a, there's a lot of sources of feedback that you can take, into the company to make decisions about what you're going to build.

But I, I want to put that aside because I think that's really important. And we do a lot of that. There's the things that your customers will come back to you and tell you this. This is a good idea. But my experience is that, you know, if if you have a horse, they will tell you that they want a faster horse, they won't tell you, oh, go build.

You know, a car. So the things where it's kind of a leap in innovation to take you from one place to another, that does it. That won't come from your customers because they won't necessarily expect that, to expect you to deliver that type of functionality for them. It might be a completely different product. And I think this is where it needs more to come from internally, from within the company.

Identifying opportunities where where you can take the company to like maybe an additional product. And so these are kind of the the leapfrog type of ideas. And we do those as well, like, and this is where we really try to kind of surprise our customers and, and be very innovative. We've done a lot of that, you know, in the last year or so, year or two around AI.

Right? There's, there's a lot of, new functionality that we came out that, I don't think our customers expected and kind of blew their minds away. And it really positioned us as kind of a cutting edge innovator in the area. I and and, and, and a true AI partner and advisor to our customers where they know, oh, Duda has our back in terms of AI because they're like leaps and bounds ahead of the curve there.

So we know we have, you know, whenever one of our like a CEO in one of at one of our companies asks like they're, you know, the person who works, directly with Duda, our champion, like, hey, what are we doing with AI? We I want them to be in this position to say, oh, we've partnered with Duda and they are taking care of it.

So many times. Our customers are looking at us to, you know, to to make sure that they're they themselves stay innovative through this partnership.

Daniel Burstein: Yeah. I mean, that's a really good point when it comes to incremental change, customers telling us is probably a good, venue for it. But when it comes to truly transformational changes, understand those customer pain points and being close enough to understand them, but then guiding them. And and that's what they're really looking for. Hey, let's take you to the next place.

Exactly. Well, we talked about so many lessons and stories from your career each day. If you had to break it down, what are the key qualities of an effective marketer?

Itai Sadan: You know, I think the best marketers that I've seen have a combination of two things. One, they have a very deep understanding of the product, and the second is there they have a very deep understanding of the customer and the pain points, and being able and being able to tie both of these things, of how this product that was built by the company is, solving these pain points.

Is providing value. You really have to really understand both of these worlds in a very deep way. Now, I've seen marketers that are strong in one, you know, maybe they have a strong understanding of the market, of the industry, but they don't understand. They haven't spent enough time really using the product. And, and I've seen the other where, you know, people who are more on the technical side but have a hard time, translating it into business value.

Again, the strongest marketer is really has deep and profound understanding of both worlds and is able to bridge that in order to, show real ROI, real value to the customer.

Daniel Burstein: Well, thanks for sharing all the lessons and story from all the different worlds you lived in in your career. I learned a lot in tech.

Itai Sadan: Yeah, now this is fun. You should definitely do that. Again, thanks for inviting me for your show.

Daniel Burstein: I'm sorry. Going.

Itai Sadan: I just said thanks for inviting me to your show.

Daniel Burstein: Absolutely. Thanks for being here. And thanks to everyone for listening.

Outro: Thank you for joining us, for how I made it and marketing with Daniel Burstein. Now that you've got an inspiration for transforming yourself as a marketer, get some ideas for your next marketing campaign. From Marketing Sherpas extensive library of free case studies at Marketing sherpa.com. That's marketing rpa.com.

Itai Sadan: And.