SaaS Founder Interview with Andrew Duffy and Jake Levin, Co-Founders @ SparkPlug

Tony Zayas 0:05
Hey everybody, welcome it’s Tony Zayas here on the SaaS founders show excited to have you guys back for another episode or as have great conversations here with SaaS founders, sharing the ups and downs, the challenges, the hurdles and the excitement of being a SaaS founder. So with that, today we’re talking to SparkPlug’s cofounders, Andrew Duffy and Jake Levin. SparkPlug rewards top performing retail salespeople with cold hard cash. The game of five Commission’s contests and goals are here to tell us all about it and the journey are Jake and Andrew. So hey, guys, thanks so much for joining us here today. How you guys doing?

Andrew Duffy 0:47
Hey there. How’s it going?

Tony Zayas 0:49
Very good.

Jake Levin 0:49
Good morning, Tony.

Tony Zayas 0:50
Good morning. So awesome. So I guess I read the little descriptor. But Andrew, Jake, tell us just a bit about SparkPlug, what it’s all about? And we’d love to hear from your perspective as the co founders.

Andrew Duffy 1:05
Yeah, absolutely, I can take a stab at it. So I think the overarching mission of SparkPlug is to help every employee earn like an owner, there’s a big division in our economic world between people who own assets, the holders of capital, and the people who earn wages by working in particular on an hourly basis. And as we’ve seen recently, there’s been a breakage in that relationship, hourly workers have been resistant to coming back to work. And owners of businesses like retailers, restaurants, warehouses have been unable to convince workers to come back to work after the pandemic. And as a result, it’s causing a ton of economic problems. So sparkplug is, you know, a solution to those types of issues, which allows retail employees restaurant employees to earn more money when they perform more when their businesses do better. So in that sense, they earn instead of just an hourly wage, a percentage of what they sell, or a percentage of what their business sells. And ultimately, we create all of the software systems to track that information, distribute funds, engage employees, and get everyone excited about the potential for that to not only improve how businesses operate, but also just improve employees lives in general.

Tony Zayas 2:21
It’s pretty interesting. Here, as we’ve talked to a number of founders, you know, over the last year and a half or so that the pandemic actually was a big boost to their business based on what they were doing their model. How was it for you guys, because it sounds like this is something incentivizing motivating employees sounds like a good thing for kind of that challenge that employers are facing today? So just tell me a bit about how the pandemic has impacted the business.

Andrew Duffy 2:55
I wouldn’t say it felt like a boost at the outset. You know, in late 2019, early 2020, we were just chugging along as a brick and mortar retail sales software. And we’re in the process of trying to raise our seed round. But as soon as March of 2020 hit pretty much every investor we were talking to stopped responding to our emails and told us that, you know, if they did respond, brick and mortar tools, were not something they were going to invest in, because, you know, they felt we were all going to be living in the metaverse. So they ultimately, were particularly excited about the business, but that we luckily didn’t stop us. And you know, we kept chugging along during the pandemic, and we’re able to work with, you know, retailers that did stay open during that time, or at least reopened relatively quickly. And that, ultimately, is where I’d say we found a product market fit of the tool. And that disruption was ultimately really powerful for our business, because it showed not only employees their value, but also employers the value of their employees. And the challenges that they would face in getting those employees back to work was something that changed the paradigm of how those hourly workers were ultimately treated. So I think it was really important for our business. And we’re glad that we started before the pandemic and had that sort of base of software and strategy and grit that we could use to get through the pandemic. But it definitely, it was definitely a tough time, that’s for sure.

Jake Levin 4:20
Yeah, it’s interesting. I think that it’s venture capitalists, especially early stage investors job to, you know, kind of have a thesis of what the world will look like in 5 or 10 years and to kind of identify early stage companies that you know, that share that vision and are going to push that forward. However, we kind of found at the time and kind of consistently that investors are just sensitive to the news cycle of the day. And of course, it’s really hard not to be when you’re being inundated with news from every angle about how retail is dead and no one’s ever going to set foot into a shop ever again because of the pandemic. Obviously, that has not been the case. But yeah, that kind kind of challenge that we faced in early 2020. It was definitely something we had to overcome. And while we had to adapt our, our narrative and our kind of timeline on that we’re thinking about SparkPlug, sticking to that original vision and kind of having faith and understanding that, maybe not this too shall pass, but the world is certainly changing. But we’re kind of gonna regress to the mean, at some point.

Tony Zayas 5:28
Yeah, that’s fantastic. Speaking of that vision, I would love to hear the origin stories. Where did the concept come from? How did you two did you guys know each other prior? Where did it all begin?

Andrew Duffy 5:45
Yeah, we were undergraduate classmates Actually, we met at at Harvard, where we were both studying different types of behavioral science. I was more behavioral economics, Jake, more government, public policy, social psychology. And we became very fast, very close friends over that time, and had always ideated as undergrads about wanting to start a business wanting to build something from the ground up and solve really hard problems. But we didn’t have that sort of spark of inspiration until we both started out in the finance world. So our first roles after school were in respectively, a hedge fund for myself and a private equity research shop for Jake. And in both of those roles, we really learned what the problem was that we had been circling around discussing and thinking about that we thought we had a great solution to so on my side,

Jake Levin 6:39
Also why we were bad employees.

Andrew Duffy 6:41
Yes, exactly. unemployable. We both hated working for other people and found that environment to be just so difficult to get up and go to every single day. So that has also shaped our view of how we want to treat our employees and make people excited to work at SparkPlug. But it, you know, subsequently taught us that, on my side with, you know, the hedge fund world, the economics of labor that I was getting deeper into, were totally broken, that capital and labor were totally imbalanced. And on Jake’s side, he was learning all about tons of different consumer products, and how they actually get out into the market into the people’s hands. And we realized, not instantly, but it’s sort of first inkling that, hey, there’s some dislocation here between the physical store environment and the brands that are trying to sell through that store environment that we can probably fix the problem of, if we apply smart technology solutions to it. And then we said, look, this is enough for us, we’re just going to quit and, you know, move, move out to Colorado and trying to figure out there, you know, in a world where the cost of living was a little bit lower than the East Coast cities that we were living in.

Tony Zayas 7:58
What was that timeline? Like? When did you make that decision that you were able to validate the idea enough that it’s like, let’s, let’s make that leap? Because that’s scary.

Andrew Duffy 8:11
Scary, but we didn’t really validate it at all. To be honest, we just we just said, Look, we think this is a an okay, idea. And ultimately, we’re just gonna figure it out. So I think we always also like didn’t,

Jake Levin 8:22
I think that was also I don’t know, I think that we were kind of that was unique in that it allowed us to be really obsessed with the problem that we were kind of solving, getting into the space and being really interested in the relationships between retailers and brands, and the workforce dynamics and the role of that frontline employee. And we didn’t really have such a crystallized product or vision. And I think some of the early stage founders get so fixated on their solution and what they see to be the answer to the problem. And they’ll build that and you know, fail to do that upfront diligence and bring a product to market. And if it’s not resonating, convince themselves that there’s something wrong with the market and that their product, and there’s more education that needs to be done to customers. And this product is right, and we just need to convince customers have right it is. And that was not the approach that we had. Because we just didn’t have that product or that solution in mind. At the outset, we understood the problem. We wanted to understand the problem space, so much better. And that allowed us to like really quickly iterate on different sorts of solutions and ideas and test different things and be super responsive to what we were hearing, and not just get our kind of ego almost so tied up in the product or solution that we were trying to bring to market and instead just be like super obsessed with with the challenge and really, I think empathetic with our customers and the people that we were talking to every day about, you know, how they were thinking about their employees, their customers, their relationships, and what opportunities that were to use technology to solve those problems.

Tony Zayas 9:56
It’s a great perspective and I love hearing that so it sounds He has identified really the problem first, and then went about how do we solve this? So how did you really get ingrained in understanding kind of what that dynamic looks like in the retail space? And so that you can figure out the solution? Like, what were those steps? What did that look like? How did you gather that info and feedback?

Andrew Duffy 10:21
Yeah, kind of two pathways. So one was that we actually started our own consumer brand. You know, as we were getting out into the hustle and bustle of being entrepreneurs, particularly in Boulder, Colorado, where we were building the company, we were adjacent to the natural foods industry, which is really, really a strong industry in Colorado and in Boulder in particular, and that afforded us the opportunity to build up a organic tea brand, which we started and which actually ended up being a really great learning experience for us to identify, hey, as a small brand owner, what are the challenges of selling a product in retail, particularly a product that is expensive and requires explanation for people to actually understand why they should buy it. So you know, we were selling this in spas and hotels in organic grocery stores. And it was just such a nightmare, getting it off the shelf, because we had to educate all the point of sale employees, and we had to beg these stores to tell us how much they had sold. And we had to consistently follow up with them to figure out you know, when we should be trying to incentivize more sales, or get people to sell more products, with education.

Jake Levin 11:35
We were getting invoices from that, and that was like the most frustrating part, we get an order for $10,000 of tea, and we’d be so excited. And we’d, you know, drop off the product. And of course, they have net 90 terms or something because we were so small, so we were just at their whim completely. And you know, 30 days into the net, 90 After dropping out the product and having no cash in hand for it, we get an invoice from, you know, one of the small grocery chains for, you know, $1,200 in scan backs, because we offered like a $5 promotion. And they did not give us any data on which stores because they had you know, had eight locations, right. And we want to know which stores were doing well, because they also were asking us to come in every Saturday and do samples and do trainings for their employees. So that was just so acutely painful for us to kind of know that something was resonating with the market and that something was working. But we were in some of our marketing activities, whether it was the customer facing, you know, $5 back or, you know, really the pop ups in store or an hour long session with a customer with a with a team of employees about how our product is so much better than everything else on the shelf. We knew that some of the things were working, but we didn’t know what and there was just like no communication from the store, it was really opaque. So so that really kind of crystallized what ultimately came to spark for us.

Andrew Duffy 12:57
And then, as the sort of secondary follow up to that, it was really just talking to every single operator that we possibly could, to the point of being really, really annoying, I think, you know, just constantly trying to talk to retailers and figure out how they think about their employees, how do they compensate their employees talking to their employees and figuring out like, Hey, do you guys get a commission? Do you guys get any type of reward? How do they distribute those rewards? Hey, can we go into the back and see, you know, what’s, you know, what do you guys have up on your whiteboard, just trying to figure out literally everything we could and being as like invasive and annoying as possible. And then similarly, making a few key relationships with brands who we could just through aggressive networking, find the executives of and identify for them, you know, hey, we’ve identified these things in retailers. Do you guys experience these problems on your side? Do you try to get in front of these employees? What does it feel like for you all? What are the big things that you want to you want to see and those really crystallized and I think, solidified our early intuitions. And like Jake mentioned, I think, really helped us to stay on the track of caring about a problem and trying to find the best solution to it rather than having a solution and trying to find problems that it will solve. Because you know, that second direction just doesn’t really work. And it’s ultimately going to restrict your flexibility. Whereas if you’re always starting with like, what’s the relationship I can build with a retailer or a brand who’s going to guide me towards the solution that’s working for them. And combine that with my intuition that that was how we really got to where we did with the product. And we’re still doing that we’re constantly still adding to what the products feature set is obviously, but also in many ways, trying to define the product direction with that combination of intuition and feedback, which is sometimes hard to strike the balance of.

Jake Levin 14:53
Yeah and I think in that endeavor is so important. I think our academic backgrounds really served us well because it allowed us to be He’s smarter than our last meeting, which is a piece of advice that one of our early investors told us. And that really just means that you have to take every conversation with a grain of salt, otherwise, you’re just gonna be like whiplash, you’re gonna hear one thing from one person, and you’re gonna have another conversation, they’re gonna say, the complete opposite, and you’re never really gonna get anywhere. So in those kind of like early conversations, and that upfront product, discovery and diligence, it’s so important to be super organized in the data that you’re collecting and buffeting and the feedback that you’re getting into, you know, one of the common threads between this customer that said this, and another customer that said something similar, versus another potential customer that, you know, had the complete opposite opinion, and was looking for something completely different. Because if you’re not kind of grouping those appropriately, and understanding what types of people are and what type of businesses are looking for what types of solutions, then you’re just going to be kind of like ping pong, back and forth between different ideas and different feedback.

Tony Zayas 16:03
So just a quick question on the T brand. Did you guys have the idea was SparkPlug in mind like that entire time when you launched that?

Andrew Duffy 16:14
Yes and no.

Jake Levin 16:16
We like to looking back, you connect the dots like that. But at the time, I don’t think that that necessarily was the ultimate goal. I think we kind of definitely thought of it as a trot like a discovery business. And I think that while

Andrew Duffy 16:31
He started on, but it started.

Jake Levin 16:34
Well, Andrew and I were also always, you know, interested in technology and software, I don’t, you know, neither of us are engineers by training or you know, product designers, even by training. So, you know, when we first kind of thought about starting a business software platform was not something that was immediately accessible for us, you know, something that would require additional talent and resources in order to get off the ground. Whereas something like a tea company, would between the two of us, we could kind of like piece together what we needed. And, you know, ultimately, that wound up being the proving ground for what SparkPlug became.

Andrew Duffy 17:09
Yeah. And I think a lot of that experience was also, like, very practical. In retrospect, every founder story is so it’s such a, an epic narrative of this led me to this led me that it’s led me to this, and this was all part of my master plan. And in reality, moving in the forward direction, it’s often Okay, well, you know, I got to Colorado, we didn’t have any way to earn money, we had to start something neither of us could code. So we thought, let’s start a tea business. That got us a little bit of the way. And then we figured out during this that there was this problem, and then that helped us to understand this, but we still kind of ran them in parallel, weren’t really sure which one was going to be the one and then figured out that technology, one was really the best one. And then, you know, charged ahead with that. So I think that as much as I think SaaS founders in particular, want to create, like an exciting narrative around the businesses, in retrospect, it can be distracting from the reality, which is that like, it all is very stochastic, and sometimes very random as to what opportunities you find, because there are several occasions for both businesses, over the course of which, if we had not just happened to be in the right room with the right person at the right time, not even in a professional context, just like some friend who we happen to be at dinner with introduced us to someone who worked at this company. And that then led to a big partnership that was huge for us. If none of that had ever happened, then we never would have gotten to the next stage. So I think that that is you have to take it with a grain of salt. You just got to show up and you got to you got to be you got to ultimately be fortunate. But you got to put yourself in a position to be fortunate.

Jake Levin 18:51
Yeah, like when we first moved to Colorado, we were just we had nothing better to do than to show up to every single startup and random industry meetup. We could find those back when meetup was still kind of a big thing. And there were always different coffee shops hosting different cool meetups, and we were just every single night for months on end, would just kind of show up and talk to people and that’s where we first met our herbalist to you know, it was kind of ideating around different blends of a tea companies you want to start and that’s what led us to start scaling why the tea company? So yeah, I’m a big believer that 90% of success is just showing up and saying yes.

Tony Zayas 19:28
That’s fantastic. Tell me a little bit about what the MVP looked like. And being non technical founders. You know, how how did you guys start to build out SparkPlug?

Jake Levin 19:45
Yeah, that’s such a good question. And something I think the MVP is such a challenge for so many early stage founders, especially those who are not really in a position to execute against the codebase on their own. Version one of Spark Plug was actually a tool that we licensed from a European startup company as well, they were kind of set, obviously much more mature than we were. But they had a kind of a white labeled solution. That was a it standard use case kind of a an employee engagement employee communications platform. And they offered a white labeled version of the tool that was designed for big enterprises, like McDonald’s or something to have a McDonald’s employee communication app. And they white labeled it and you could download it to iOS, Android. And it was the McDonald’s app. And we worked with them. And we kind of branded it as our own tool. And, you know, they worked with us closely. And they kind of understand that we’re a startup. And that allowed us to, you know, over the course of six weeks, launch it on iOS, Android, and with like a web application, a very full featured employee communication tool, that we were kind of able to adapt some of the feature sets to serve our use case and kind of silo our customers into different buckets within it. That required no coding on our end, that kind of just worked with their team to figure it out. And Andrew and I talk about this all the time, because, you know, after about a year, we had that product in the market for about a year before, it just didn’t work for us anymore, it was just too much of a handcuff. For us, because we couldn’t change anything about it. It wasn’t our products, we were, you know, in six weeks, we kind of launched this tool, and we were having the market getting people to use it. And it was people were so impressed with it because it was really mature, and cool. And it worked. And then we started getting feedback about how great it would be to be able to do this one thing. And it just really inhibited us from being responsive to our customers and evolving the product. And like pivoting the use case and serving the needs of the the kind of more specific niche of the customers that we were really trying to serve. So it was incredible in the sense that it allowed us to really quickly validate that there was something to what we were trying to do in this space. But ultimately, really was a challenge for us. And it was really a painful bandaid to rip off on that day that we decided that we could no longer use this tool anymore. Because we had just kind of pushed it to the limit of how flexible it could be and how it worked for our customers. And it was time to you know, at that point, we kind of had the resources both from early stage investors, and then from the customers that we we kind of got onto that platform to rip the band aid and break ground on our own, you know, 100% homegrown solution, SparkPlug.

Andrew Duffy 22:41
And I think that experience is another example of sort of the like retroactive story versus the practical, you know, forward looking piece. And we go back and forth over whether it was the right decision to use that. Because at the time, we were really, really focused on speed, we wanted to really, really rapidly get something out there and not have to go through that classic like MVP iteration process, since particularly, we didn’t have those engineering capabilities, and instead, go straight to an SRP a sales ready product and just be able to get into those conversations. And given where we are now, I think that that was definitely the right decision. Because if we had started by trying to build something from the ground up or work with an agency to build out an MVP, which were all things that we were considering, that would never have gotten us to the point of insight that actually drove us towards what spark plugs is today. And that was because when we got this tool out there, it had plenty of different features, all of which we could practice selling towards and see what people actually cared about and what they’re interested in. And then when we were able to land some pretty big clients with that original iteration of the tool, then we were able to be essentially a part of their organization and worked really closely with them to figure out what the problems were in their retail environment and identify, literally in the store, like have an excuse to walk into the store and say, Hey, I’m here to onboard everyone to the tool, walk around, look at their whiteboards and see, hey, that’s interesting on this whiteboard in the back at all of these five stores that I’ve driven to today, they have a leaderboard of all of the employees. Well, what if we just build out a leaderboard that’s already integrated into their point of sale system in this tool, display it to them, and then they can just see what it looks like. And that’s actually where we started what I would call like the MVP process, because within our existing SRP frame, you know, Jake, and our CTO at the time drove in this integration snapshot where it just showed them, okay, here’s this leaderboard of all the different employees and how they’re selling. And then that started to get a lot of traffic and a lot of interest from people and started to boost sales and of itself. And that really gave us the first flicker of insight into how powerful that piece which we had always believed in but had never had the opportunity to test was going to be and that’s what drove us towards building out SparkPlug, which is you know, in essence, the most powerful well built out engine for grading, leaderboards, competitions, Commission’s goals, anything that’s going to reward people based on their performance.

Tony Zayas 25:09
So is that leaderboard was that like kind of that initial like sticky feature that got some traction and got people interested in?

Jake Levin 25:19
The thing I think that was the most unique thing, I think that the the tool that I was kind of describing before was a, like an employee’s internet, internal communications for updates and reminders and scheduling and you know, did a punch a bunch of stuff, but it was not really differentiated in any way, as we were kind of trying to sell that product into into stores, we just get met with well, you know, we’re gonna use Slack, or we just text each other, we just email each other. And it really wasn’t that kind of, like compelling used case. And, you know, having those conversations and seeing those whiteboards really was what kind of presented that unlock to Andrew and myself that there was nothing besides the whiteboard in the back where managers were posting a leaderboard of the highest order average. And, you know, we were lucky enough to get some stores to consolidate that updates from the whiteboard onto the tool where they can post their team, you know, via like a timeline message in that MVP app, the order average update, but that still require the manager to run the export, pull the numbers, and, you know, and post that to the team. And that was that kind of insight of the next evolution have really specialized use case of saving that manager a half hour every day of running that pivot table in Excel based on the point of sale exports, and instead integrate with the point of sale and calculate that leaderboard and post it in real time. So yeah, absolutely. I think that the kind of landscape today of no code and low code tools is so remarkable and can really allow you to do so much and to like, get that attention and kind of like wedge yourself into customers or users are so easily where you can then start to get the real learnings and the real insights on how your product can be more different or better. Before ever lighting and writing a line of code. You know, that’s different from anything else.

Tony Zayas 27:16
Yeah, it’s really cool. So how did you guys go about getting those, you know, first few customers?

Andrew Duffy 27:24
Literally, every which way we possibly could, we tried absolutely everything. And simultaneously, nothing worked. And everything worked. Like, you know, we got some customers by just walking in the door of the store and bothering them until they would get the manager to talk to us, we got our protect our biggest customer that you know, was that one that we sort of gleaned the insight of the leaderboards from by going to a networking event that they were the CEO is speaking on a panel for and I sat in the front row, and just like made eye contact with him the whole time. And it was asked me a bunch of questions. And then immediately after it ended, just Beeline walked right up to him was like, Hey, we got to talk, bang and bang just pitched him super hard on it. And that turned into, you know, having a meeting with their head of it, and then having a pitch to their top 20 you know, division heads, and then finally getting them to onboard the tool.

Jake Levin 28:21
So we’re saying no, that was kind of the philosophy that we always, like, we either get a yes or no and nothing else is acceptable. And we’re going to email and call and follow up with people until they were like, No, leave us alone, in which cases we drop it and forget it. Or they say

Andrew Duffy 28:39
Or we say well, come on.

Jake Levin 28:40
Yeah, or they’d say yes. And I think that kind of selling to no philosophy is just like so important, because people are gonna let you sit in their inbox. And you really do have to be aggressive in getting that attention. And then ultimately, your if your product kind of speaks for itself, then you’re gonna get that yes, that you’re looking for. And I think alternatively, we also, you know, when you think about sales and leads, you can take the quantity approach or quality approach, you know, a volume game of the emailing 10,000 people knowing that you’re gonna probably get a 5% conversion, and can finally get 5% to say yes. And you’re just gonna like pull from whatever online resource or list you can find to get those emails versus quality. And I think that’s for SparkPlug we have, you know, what we started with quantity of just like, getting into as many inboxes as we can, the kind of marketplace aspect of our product where we allow the CPG companies to offer incentives to store employees kind of lends itself to identifying the really high quality leads and the good fit customers so that we could get introductions and kind of approach a customer knowing that SparkPlug is such a great fit for their business because so many businesses that look just like them and sell products, just like theirs are already using SparkPlug and we can approach them with the case studies and the roof, on why they are such a quality fit for our tool. So I think that’s early, early stage quantity is your friend. And then as you kind of find that product market fit and can kind of like distill the perfect customer, then kind of shift to a quality approach.

Andrew Duffy 30:18
Yeah. And that shift can be hard to track when you’re doing that. And it’s, it can be hard to determine when your business is at the phase where you can afford to turn down a bad fit customer, or fire a bad fit customer. You know, I feel like we’re only just getting to the phase where we can identify, hey, this just isn’t that good of a customer. They’re not paying us as much as we want. And they are an outsized amount of our customer success. And they just, yeah, their opinion. Yeah, so just make us stressed out, because we have such a extreme dedication to customer success and customer service and making sure that people are really, really succeeding on the tool, that when people aren’t succeeding on the tool, it’s extremely stressful to us, like, we just feel like we really want to get them to succeed. And sometimes they’re just not the right fit to succeed on a tool. So identifying who those people are at the outset is really hard to do and is critical, though. And I think, even as it pertains to what Jake was saying about quantity, early days, I agree with that. But I do think that there’s a degree to which you can’t replace the relationship building aspect, like those early customers are going to be the ones who you have to be able to go back and forth with and say, Hey, sorry, this thing’s actually broken. And oh, actually, this thing’s not gonna be ready until this time. And hey, can you actually help me? Can you like, download this thing? And tell me if it looks right? Or can you send me a screenshot of this thing and tell me if it looks right on your screen, like you have, you’re going to have to do all that stuff with your early customers. So you can’t just like email out 10,000 people and tell them you have something that you don’t have, you have to get them interested, and then be very clear with them about the fact that this is a tool that we’re going to have to like iterate on together, let’s build a relationship around this. So the relationship building aspect of it, once you’ve gotten them from that maybe first set of conversions is a really crucial part. And in that sense, you kind of turned the quantity relationships into quality relationships by really being vulnerable and honest with them about like, Hey, we’re starting this out, I need your help. We know this would be so helpful to you. And if you’re really bought in on how helpful this could be, like help us build it together.

Tony Zayas 32:26
Yeah, that’s really interesting. The approach to you know, quality versus quantity and kind of, you know, making the transition from one to the other. I do consulting with SaaS founders, and that is, you know, I think quantity. It’s more accessible, it sounds easier, it sounds, you know, faster, less expensive. How do you make the case? And how did you guys come to was it by design and intentional that you said, Hey, we’re gonna get we’re just need to take activity, you know, and get out there. But was it intentional, that you would shift and become more targeted and put the emphasis?

Jake Levin 33:13
Yes, I think it was, I think that in the quantity side of things, it’s really hard to discern the strength of their intent. I think that you can, again, email 10,000 people and, you know, 100 might respond with like, yeah, that sounds cool. But of that 100, you probably are only gonna get maybe five to click the Buy button. And finding out how many people have that 10,000 are going to click Buy, I think is like the real challenge. I actually have a friend who is in the middle of starting a business right now. And she, it’s a it’s like a hair tight. It’s a hair product that’s like super unique for like a hair mask. And she doesn’t have it at all yet. And she’s really trying to like test how receptive the market would be to this sort of product. And everyone she asked says yes, and people are really inclined to say yes to things, especially when they are, you know, talking to a founder, and they want to be encouraging and they’re like, I could use this. But how many of those people are really ready to click Buy It is a whole different story. So what she did was design a website where people could click Buy and could put in their credit card details. And as soon as they did that, she doesn’t have the product. So she was just immediately responding them and following up and saying, oh, sorry, we’re out of stock. We’ll follow up and we’re back in stock. But that to me is, you know, kind of like dubious, ethical standing perhaps, but is a like unbelievably effective way to really flesh out the purchase intent of, you know, the audience that she’s trying to target. So I’ve always thought that that was a really impressive approach and it’s something that is just a really challenging thing to do when you are in that volume game. Everybody thank you.

Andrew Duffy 35:07
Yeah, I mean, I, my, I think Jake has a more scientific approach to it than I do and is better read on the overarching, like strategy of converting huge funnels of leads into individual buyers. But I just from a qualitative like empathetic standpoint, I’ve never clicked on an ad to buy something online, I’ve almost never maybe once responded to a cold email to buy software ever in my life as a business owner or as an individual consumer. And I have just never felt strongly that that is a sales strategy of like crazy high quantity, crazy low quality touchpoints that would would serve a business well or would serve a business efficiently. And I think that that intuition plus the reality of when we did do that, there just weren’t that many people who would move all the way through and get to that click by point, I think pushed us towards the direction of like, look, we want to build a tool that sells itself not in like the classic salesy way, but literally in that using the tool creates a network that brings other people in to the network, inherently that classic product lead growth strategy, which for us means CPG brands want to bring their retailers onto the tool and leverage the relationships they already have, which are strong, which are meaningful, which are tested, instead of relationships that we’re just trying to build out of nowhere with a cold email. And vice versa. When the retailer’s want to bring their brand partners on board so that they can receive more incentives for their employees, you know, we can leverage those relationships. And that always struck us as the thing to invest in, and the way to actually do quality at quantity, because we can leverage the relationships of our network rather than trying to create our own relationships at scale. So I think we, we simultaneously had some intuition around it. And then we had some experiences around it that drove us to where we are today. And I think, as it pertains also to that, sort of like click Buy behavior, while it may be discouraging, it actually is intelligent to bring the harder part of the sales process forward in the sales process. Because if you have people opening an email, scheduling a meeting, maybe taking a look at this or that thing, those are all points where you will build up your hope about what will get them to then buy and then they actually don’t. So if you try and get them to execute on some effort early on, and indicate that, hey, they do have some buy in about this thing, they actually want to try to get it and you don’t actually make it so so so easy for them. And so, so, so attractive for them to click into the next step that can actually help save you a lot of time and a lot of heartache by just saying, like, look, I only want to get people who actually care about this thing, you’re gonna move through the process for it.

Jake Levin 37:56
Pricing, I think otherwise, it’s like a disservice to always be you can use this for free as long as you want, it just means that you’re going to spend a lot of time with them, you’re going to customize your product to fit their needs. And then when you ask them to pay 20 bucks a month, they’re going to stop responding to your emails. So getting that buy in upfront, is the hardest part, you know exactly kind of what we’re talking about here. And what it sounds like, you know, I think is so relevant to so much of your audience, right of those first 10 customers, because once you have 10 paying customers, building the look alike audience and leveraging them for referrals, even, it’s so much easier and so much more accessible. But getting that first 10 is the most challenging part absolutely.

Andrew Duffy 38:41
And there’s also such a massive, internal emotional difference between selling a product that you are totally unsure of, versus a product that you’re confident in the process of going out and trying to sell someone on something that literally no one has ever used is like dancing on a high wire, it feels so stressful and so full of pitfalls. And that really activates imposter syndrome and makes you feel like what am I doing? I’m such a joker, why am I doing this at all? And then once you have those early customers that have actually used it and have actually seen positive results, it’s a total game changer. And you’ll always struggle with the question of, you know, how effectively can I sell something that I don’t have confidence in, so you need to build confidence in it. And the more and more customers who have who have great results in it, the more you’ll be able to go out there and say honestly and in a way that actually builds conviction for your customers because they can detect it, whether it’s subconscious or conscious that you really believe in this thing. You know, that’ll just extend your lifetime as a founder trying to hustle your first 100 customers now after your first 10 customers. So thinking about it in that iterative emotional way is also super important.

Tony Zayas 40:01
Hearing about and talking about that emotional side of things. And kind of as you go through this journey as a founder and the challenges and things that you’re taking on, and like the point of imposter syndrome that comes up a lot, how did you guys deal with that? And what’s the point I wanted to get into was the dynamic and how you guys work together? But how do you guys, you know, what did that journey look like early stage when it’s rocky and tough? You know, to gaining some momentum? How did you deal with, you know, that roller coaster that you’re going through?

Jake Levin 40:37
So your question, I think, Andrew, and, and my strengths have always been something that I think would be hard, maybe for other kind of early stage founders to replicate in that we are best friends. And I get along pretty well, and that we have always been 50-50 on everything, it has never been a question whether either of us have been, you know, bought in or one of us is working harder than the other. And that has been because we have always been 50-50 on our ventures. And I think that not there are plenty, and plenty of businesses and startups that have succeeded with different sort of organization or ownership dynamics, where there’s a CEO with the idea who brings on another founder, you know, who’s like 70-30. I think, personally, that those sorts of arrangements are a step towards failure at the outset and a step towards disagreements and frustration and, you know, just doubt in one another’s buy in or impact or commitment to the product or the success of the business. So I think that wherever possible finding, of course, a cofounder, I can’t imagine doing it alone, I think that would be totally impossible. So I think, oh, having a cofounder is important, or multiple cofounders. And if you can’t achieve that kind of perfect split of the kind of mutual trust and by him then being super transparent about ownership compensation, responsibilities, is the only way that you can expect to succeed, because otherwise, you’re just kind of setting yourself up for failure, I think.

Andrew Duffy 42:25
Yeah, I think, to reiterate, that point, we had a lot of people give us the advice of you guys should split 51-49. And this guy decide who is like the decision maker. And I think that the ideas are free, they are cheap, everyone has a great idea, every great idea has probably been thought of already. And whenever people say to us, oh, wow, SparkPlug’s such a great idea. It’s like, no, it’s an idea. Just like any idea, execution is the only thing that matters. If you’re not in there grinding and making it happen, then it’s it’s never going to happen. And so if you can’t come to your co founder with whom you have a 50-50, split and an even decision making architecture and say, look, we got to figure this out, let’s be totally transparent and honest about why we want to decide this or why we want to decide that. And if you can’t come to an agreement, then that’s a bigger issue than just that individual decision. And you have to hash that out first. So I think that having a relationship with your co founder, that is, in many ways more like a marriage than it is like a professional partnership is is super important. Like early in when we were working together, and we were facing some of the harder times of the business, we went to a cofounder counselor who was just an after hours marriage counselor, she was a marriage counselor during the day and did co founder counseling at night. And that was really, really valuable because it gave us really good tools for managing our personal and professional relationship and thinking about different frameworks for how we could express ourselves and communicate effectively. So I think investing really heavily in the working relationship you have with your co founder is probably the most valuable non cash or cash investment you can make. Because that ultimately is going to drive the quality of life that you have, like if you enjoy actually working every day and doing, you know, the extra hours on the weekend or the really difficult, you know, sessions late at night when you’re trying to figure things out together, then it again extends the lifetime of what you can do as a co founding team. And then from like a more practical perspective, I think it’s a question also of everybody doing everything until that no longer makes sense. So you know, there was a time early on in the business where Jake and I were just super fluidly swapped roles and just, you know, he would start doing investor communications and I would start doing, you know, designs for a website. And then over time, we just identified that we had different skill sets that could be siloed into particular parts of the business, even though we had kind of generally overlapping skill sets at the outset, which we at first thought was a big problem. But it later on ultimately became a way for us to be able to actually silo and get better and better. And now Jake, you know, is the the operations and product guy who is a genius at designing great systems and designing great tools, and I, you know, more and working on the sales side and the investor and governance side, and, you know, building relationships externally and trying to leverage those on behalf of the business. But Jake is, you know, just as naturally skilled at building relationships as I am, so he can contribute whenever I’m having a challenge, or whenever we’re making a decision together. And I won’t say I’m as naturally skilled at product as Jake is, but I can understand those things. And I can think through those things and help him, you know, to identify, you know, maybe what the right path is based on his intuition. So I think being able to contribute in the ways that other people are working is super helpful as well for co founders. So don’t like at the outset, just say, Hey, you just do this stuff, I just do this stuff, because then you don’t really have a decision making partner and you don’t have someone who you can bounce ideas off of. And you suddenly become just two totally separate siloed people who don’t have the ability to lean on each other as as thought partners.

Tony Zayas 46:17
So I would love to hear a little bit about how you guys do, you know, strategic planning and staying, you know, keeping the vision as something that’s mutual between the two of you, because it sounds like you guys had a great working relationship. And I love how you mentioned that, you know, relationship counselor, we had a founder on about a month ago who literally said it was his, he had a marriage counselor he was working with that he would go to and start to talk about business. And they actually him and his wife had to go and find another marriage because that became his, you know, his business coach or counselor, right? So makes a ton of sense. But how do you guys manage kind of the strategic planning, big picture, vision, all that kind of stuff?

Andrew Duffy 47:06
I honestly don’t I mean, maybe Jake has a better answer for this. But it is sort of just like a mind meld thing. Which, that’s more the thing that we have to actively manage, because we are constantly talking about and thinking about the business and constantly iterating in our own heads, and bouncing back and forth our ideas such that we are very naturally on the same page, and are consistently thinking the same things, because we are having a lot a lot, a lot of discourse about it. So in terms of the vision, and in terms of the strategic direction of the company, those things were never particularly far apart on them. But I think the real challenge for us, if you have a really tight working relationship with your co founder is helping other people be a part of that and letting other people in on that process. So that now that we’ve built a team, and we have, you know, 15 full time employees, it is I can imagine it’s hard for them. And sometimes they’ve expressed that it’s hard for them, when Jake and I will be hashing things out over the weekend. We’ll come back on Monday. And it seems like we kind of have a totally different strategy around how we’re doing this thing, or how we’re doing that thing. And obviously, now that the business is more mature, it doesn’t like 180 degree shift over put something completely different. But there can be these kind of minor iterations that feel like, Hey, I thought our sales strategy was going to be like this this quarter. And you guys seem like you’re directed more towards this. And I think that that’s where trying to scale that communication and scale, that sort of vision setting with the team is a really critical part of growing a team and managing a team effectively. And making sure that the magic of the co founder relationship and the vision setting there isn’t lost when you are becoming a bigger organization. So we’ve tried to adapt that with like, we did our first big team off site, because we’re a fully remote team. But we did a big off site altogether earlier this year. And we had that very collaborative collective sort of group like vision and mission setting that was, you know, an update on our existing vision and mission that had been set just by me and Jake. And it was great to be able to loop everybody in on that and really, you know, think as a team on it and sort of set that framework for us to continue doing that in the future. So yeah, that that’s more or we’ve experienced challenges less us to stay on the same page.

Jake Levin 49:30
Yeah, I think it’s all about organizational and institutional memory and documentation. I am a big believer in that. And that’s something we’re always trying to improve on. I read years ago, a kind of summary of how wordpress.org operates. They’ve been a fully remote team since WordPress was first founded and they have a company wiki essentially, which is split up into a bunch of different pages and subpages acrossevery kind of business vertical and topic and it is a living documents that is filled with hundreds and hundreds of posts of discourse and contributions to the conversation and is essentially like a living WordPress of how decisions were made. And you know, you know, kind of directions were decided on. And that is aspirational for sure. For us, I think that you know, that everything is, is still mostly on meetings and kind of captured in different ways. But I think having that sort of like company wiki where new hires can go back as far back as they want to understand, you know, how we got to this place, is really valuable from like, a culture and buying and transparency standpoint, which we are big believers in, but also in that, you know, kind of initiative of engaging everyone in these sorts of processes and kind of strategic decision making things. So yeah, I think like capturing everything written down somewhere, it’s so important, and something that will really kind of pay dividends in the long term, if only for the kind of emotional and business a time capsule that I can provide.

Tony Zayas 51:15
Yeah, I think that’s a very smart move there, that the finding process for scalability is so important. So yeah, that’s, that’s a great early observation that you guys are, you know, following. So that’s fantastic. Before I ask my last question, this has been a great conversation, I would just love to hear a little bit about, you know, what does the next year to three years look like for you guys in the business? Where are you heading?

Andrew Duffy 51:45
Yeah, so we have experienced honestly, over the last two quarters, the most significant period of growth in the history of the company and are dancing around that feeling of, quote, unquote, hyper growth that we hear a lot of people use, which I think is simultaneously overwhelming, but extremely exciting. So I think how we think about the next three years in the business is, first of all, you know, we’re raising our Series A right now. And we’re leveraging that to expand not only, you know, the team, but also the quality of our systems, and you know, the quality of our product as efficiently and as effectively as possible. But we have a slightly different mindset, I’d say around growing a business than the sort of classic like venture backed ecosystem plays that we’ve, we’ve seen in the past, like, a lot of these businesses are built with monopoly in mind. And the idea that by becoming a monopoly, your business model will suddenly validate it, because then you can just jack up prices as much as you want. Whereas we’re very focused on having a profitable business model that we can scale profitably and efficiently. And I think that’s kind of the new wave of how startups are going to have to work particularly, you know, b2b SaaS startups, because the days when people will just give you 10s of millions of dollars to totally unprofitably and recklessly grow something and then hope that it becomes profitable, you know, after it IPOs, I guess, those those just aren’t really there anymore. So, in that sense, really, we’re looking to grow as aggressively as possible across as many retail verticals as we can, while still maintaining that degree of efficiency and profitability. And, you know, expanding across as many geographies as we can as well, you know, right now, we’re a US based and we’re pretty focused in the US, but we have a lot of opportunities outside of the US as well. The way we see it is that the more we can seed, more retail verticals, with our first opportunities, the more we can start spinning our flywheel of network effects that allows us to grow passively and really efficiently. Rather than having to have you know, a huge team of SDRs and BDR, smiling and dialing people, you know, the more we can get our product into the hands of some really important flagship customers who we very efficiently target, the more we can then, you know, grow at a rate that is unprecedented for a tool of our efficiency. So that’s our big focus.

Tony Zayas 54:19
That’s fantastic. And were for those, you know, for the people who are tuned in, you know, interested in the story, and following you guys, where’s the best place to follow the business as well as you guys personally?

Jake Levin 54:35
Yeah, we’re on LinkedIn. It’s actually something Andrew and I are always trying to be better about documenting the journey. And, you know, kind of sharing the wins and the Ls with the world. So LinkedIn, our SparkPlug page is probably the best place for that. You can find us both there as well. We’re not on Twitter, or anything like that. Really. We have a journal that we keep on our website, SparkPlug dot app, which I would love for you to check out lots of kind of great thoughts there on workforce dynamics and the product in kind of the post COVID labor crisis and opportunities before us. Anywhere else, Andrew?

Andrew Duffy 55:19
that’s about it. I’ve been told we need personal websites. So we’ll spin those up soon enough.

Jake Levin 55:25
Put it on the to do list.

Andrew Duffy 55:26
Yeah.

Tony Zayas 55:26
You go. Sure if nothing else on that list? Well, very cool. So the last question that we always like to wrap up with, you know, if you can both go back in time, and sit down and have a cup of coffee with your former self, before you delve into the business, what’s the one piece of advice that you’d give to yourself? Volunteers to go first.

Jake Levin 55:57
Trying to think.

Andrew Duffy 55:57
I think I can go first. I think that the a piece of advice that I was recently given by a mentor was to enjoy the process of earning the seat. And what that means, ultimately, is everybody particularly people who are starting out on an entrepreneurial journey want to be in Jeff Bezos seat or want to be an Elon Musk’s seat, and they want to have that impact, they want to have that visibility, they want to have that financial outcome. But it takes a long time. And it takes a lot of experiences to actually earn that seat. And if a lot of people if they were thrust into Jeff Bezos issues today, or were thrust into Elon Musk’s shoes today, would not be able to do the things that those people can do, and will not be able to make the decisions that those people make effectively. So the process of earning the seat is, every time you get punched in the gut, and you have a bad experience with a customer with an investor with an employee, or every time you are faced with a challenge where you have to learn something really fast to be able to, you know, swim instead of sink. Those are processes that you can experience as suffering in the moment, or you can think of as just more opportunities to earn the seat into the future. So that’s something that I think if I embodied earlier on, I would have not necessarily made different decisions or pointed myself in a different direction, but I just would have enjoyed it more. And I think I would have felt a lot less strain and a lot less stress. Because in reality, I don’t think I would change anything in my past. From a decision making perspective, I’m so happy about where we are today and what we’ve accomplished. So I think I would just want to maybe experience it with a little less of a tight grip.

Jake Levin 57:52
Yeah, I definitely agree with that sentiment, I think that I’m a big believer that greatness is in the agency of others. And I think that historically, Andrew and I have been slow to really trust people that we bring onto the team and empower them with responsibility. And, you know, decision making authority. And I think that that has been a decision to service to us, perhaps in the past, and you know, only in this most recent stage where we have really kind of achieved the growth that we’ve always been targeting. That’s been the result of, you know, having incredible team having an incredible team and incredible individuals who have, you know, complete domain and authority over their respective verticals. And, you know, I think that giving over that trust is something that I endeavor to do sooner and with more people across more verticals of the business as we go forward.

Tony Zayas 58:55
That’s awesome. Well, Jake, Andrew, this has been a fantastic conversation. I want to say thank you to both of you for spending your time here with us. Separatists tuned in we’re gonna see this otherwise. Yeah, check them out. I think you guys are doing some really interesting stuff. We will be back next week with another interview. But thanks again today, gentlemen. Good luck with everything and we will see everybody next week show.

Jake Levin 59:23
Awesome. Thanks, Tony.

Tony Zayas 59:25
Take care. Take care.

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