The following interview is a conversation we had with Andrew Wolfe, Co-Founder and Co-CEO of Bloomfilter, on our podcast Category Visionaries. You can view the full episode here: $7 Million Raised to Power the Future of Process Mining
Andrew Wolfe
Thank you for having me.
Brett
Not a problem. Super excited for our conversation here. To kick things off, can we just start with a quick summary of who you are and a bit more about your background?
Andrew Wolfe
Yeah, absolutely. So obviously my name is Andrew Wolf, Co-CEO and Co-Founder of Bloomfilter. I’m a serial entrepreneur in Cleveland, Ohio. I grew up in central Ohio. I’ve lived on both coasts for a little bit of time. I come from a technical background, so I started coding professionally when I was 13. A lot of listeners may or may not know what Usenet is, but I used to join Usenet forums and would bill myself out building Perl and PHP websites when the Internet was still very young. And I grew that into an entire career. I have a master’s in computer science. I’ve spent my entire career either being a leader or manager or developer in the technical space, just very enthusiastic about finding problems and solving them with code. And so all that’s led me to be an entrepreneur.
Andrew Wolfe
I remember reading the first Paul Graham essays and how transformative and paradigm shifting those were for me. So I just very much love the startup game and technology and the intersection between the two.
Brett
So take us back to when you were 13, living in Ohio there. Where did you get the exposure to tech and this whole world?
Andrew Wolfe
Yeah, I was, we’ll call it a disadvantaged youth and didn’t necessarily have the best upbringing. And so I got to spend a lot of time at the library for various different reasons. Some of them because I was on probation and some of them because I didn’t have Internet at home. And when you’re spending, I don’t know, four to 5 hours day at the library, you find out a lot of books. And the Internet was kind of brand new, and so there were really cool games online. I wanted to build games, and so I would check out a book and started with C and C plus, and from there grew it into Perl and then PHP, which was my first web native language, we’ll call it.
Andrew Wolfe
So it was just a matter of what you do with 5 hours of time and with a curiosity to build things.
Brett
As you started to dive deeper there in the back of your head, did you always have this idea that at some point you would be an entrepreneur and start a company? Or was the initial idea to be just a developer and just build and write code?
Andrew Wolfe
It was really around that. I mean, I didn’t really know entrepreneurship was a thing growing up. I didn’t necessarily have anyone around me that was an entrepreneur. And the Internet was still really fragmented. So finding communities where people were building actual businesses and everything else wasn’t nearly as prevalent as it is today. So I would just join Usenet forums, which were these, like, ICQ is or AOL. They were kind of like that, but they were a little different. And you could join them, and there was a bunch of people chatting and randomly people would post, hey, I need someone to write this website or fix this or do this, and they would pay 20, $30 an hour. When you don’t have any money and you’re a teenager, really good.
Andrew Wolfe
So you start picking up jobs like that and you kind of learn on the job. And really people were patient. I mean, no one was really the web professional that we have today. It was very much the wild west. So if you knew anything about anything, we always joked that if you knew HTML, you could get a job paying six figures in Silicon Valley. But it was mostly true. I mean, no one really understood any of it. So if you understood anything at all, you could make pretty decent money just doing od jobs here or there.
Brett
When it comes to your inspiration, who’s like the most inspirational Founder that comes to mind, I’m going to throw way.
Andrew Wolfe
Back in american history. Rockefeller is my all time inspirational Founder entrepreneur. I mean, when you look at the impact that the man had, right, you can take the legal things out of it. But when Standard Oil is broken up, it created the seven sisters, seven largest oil companies, who today still pretty much dominate the market. He founded University of Chicago, started one of the premier PhD programs for medical science and the medical field in general. And just the breadth and depth that the impact he had on american society and society around the world, really. And on top of that, to be able to do all that while still staying true to his values. And it’s hard to imagine a guy that’s had more impact than he did. Particularly for me. That’s inspirational.
Andrew Wolfe
It’s like what you could achieve by staying laser focused on building and solving a key problem everyone has and then giving back to the world in a very significant and meaningful way.
Brett
Yeah, he’s such a fascinating entrepreneur and just historical figure in general. I am a bit of a nerd there. With Rockefeller. I read Titan, that’s one of my all time favorite biographies. And then I was just listening to a podcast recently that went deep on Standard oil called acquired. Have you ever listened to that?
Andrew Wolfe
That’s on my list of podcasts. And Titan is one of my favorite books. I really want to listen to it. I’m a huge fan and like thing about the Gilded Age, I’m a huge fan of that period of time because it’s so interesting and how know JP Morgan, all those entrepreneurs did such incredible things. And granted there’s some things in society that didn’t happen the way they should and all that, you can judge it, but just looking at for pure commerce, business, bigger type time period, it’s just so interesting.
Brett
Yeah, totally agree. You’ll like this one fact that I got from acquired. So I was listening to the episode on Standard Oil, I think it was like 4 hours long. So you have to spread it out. But they said that Chevron still has the copyright in California to Standard Oil. And in California there’s like a use it or lose it policy, I guess with copyright. So driving around, if you look at all of the gas stations, they look like the normal mobile sign. But if you look at one in particular in San Francisco, it actually does say Standard Oil on it. So it’s the exact same logo they would normally have for mobile gas stations. But it says Standard Oil and that’s the only one that’s left, I believe, in the country.
Brett
So one little random fact that I thought was really cool, that is really.
Andrew Wolfe
Interesting and kind of hilarious too.
Brett
Yeah, for sure. Now, outside of Titan, what would you say is your favorite book?
Andrew Wolfe
I would go Zen and the art of motorcycle maintenance. To me it’s one of the seminal classics. When you think about just one psychology, but two, I really like the way it’s written. I like the story that gets told then. And I like the concept. It poses of quality being metaphysical. And I think that spins off a lot of different thoughts for me in terms of, well, if that’s metaphysical, what does that actually mean for other things like artistry and engineering? If qualities between the person and the object, then it throws into question a lot of different things. That we do every day, especially when it comes to creative functions. That’s my favorite, I think, thought provoking book and probably my favorite book of all.
Brett
Ooh, that’s a good endorsement. That’s one of those books that I’ve just hear, or I’ve heard from time to time people talk about, but I’ve never actually added it to the Amazon cart, so I’ll do that right after this interview.
Andrew Wolfe
Awesome. You should. It’s a great read.
Brett
Let’s switch gears now and let’s dive a bit deeper into the company. So how we like to begin this portion of the interview is really talking about the problem. So at a very high level, what problem does Bloomfilter solve?
Andrew Wolfe
Yeah, bloomfilter, in one sentence is process mining for the SDLC. What that means is we sit on top of your existing systems, Jira, GitHub, Figma systems that people use every day to build software. We pull the data out, we apply AI and process mining techniques. We stitch the data together, and then we show you where you have issues in your process. And by doing that, we make you more predictable, observable, and efficient. Really, the end of the day, the problem statement is that 78% of software projects are late, over budget, or don’t ship at all. Just to give you a reference, $208,000,000,000 is going to be spent this year on software development. Next year, that number will go up 30% globally. It’s a trillion dollar problem.
Andrew Wolfe
And when you apply, 78% of that is waste starts to really put into perspective just how much of a problem this is. And that’s the problem we’re going after.
Brett
Take us back to October 2021. When you founded the company, what was it about this problem in particular that made you say, yes, that’s it. Let’s go build a company around this.
Andrew Wolfe
Oh, yeah. So this is not the first company I’ve built to try to solve this problem. So I became obsessed with this problem when I was a consultant. Years ago, I had sold my second startup to a massive real estate company. It was an AI company in the real estate space, and I was really trying to figure out what I wanted to do next. And what really got me was this particular problem. I was brought into a local healthcare system here in Cleveland, Ohio. It was a project that needed saving, and I was pretty good at saving projects at that point. So they brought me in, and it was a children’s diabetes monitor. And before you can buy them now, I think they even sell them off the shelf.
Andrew Wolfe
But it was an ultraviolet light thing you’d put on your shoulder, and then you’d have a companion app that would tell you what your a one c levels were and all that. And so I figured what I was joining was the firmware wasn’t working on the device. I’d worked on low level c in my master’s program. I could definitely help them with that, but that wasn’t the problem. The problem was the mobile app. And so joining this project, it was completely sideways. They didn’t have any of the best practices implemented. And this was one of the largest consulting shops in the world. You can throw a dart and pick one of them, and you’d probably be right. But I came in, they put me in charge of the project, and then it was ultimately canceled.
Andrew Wolfe
But during the four or five months I was working on this project, I got to see the impact that this would have had. You start interfacing with the kids during test days, and they’re so excited because they don’t have to prick their fingers every morning or every time they test their blood. As small as it might be, the small little traumas in life start to add up. And this was something that could have solved the problem. And to me, the device seemed like the hard part, right? Like, you got this cool medical device that seems really hard to build, and we can’t write a mobile app. Like, the software, it’s just a mobile app, like something everyone does every day. Hotel chains do it, fast food companies have mobile apps, but we can’t write a mobile app to solve this problem.
Andrew Wolfe
And so it just drove me nuts that we couldn’t get this to ship. So I started a company called Skip list six months after that, which was a consulting company to basically fix this. In my mind, it was a concept around thoughtful software. And I thought, this world’s failing because software has eaten the world, and we’re being thoughtless. We’re supposed to be the smartest industry in the world, and yet we have spyware installed as social media networks and all this other stuff. And we’re just thoughtless in how we ship software. And we scaled that to about eight figures. But what really still bothered me was weren’t really getting to the scale where I felt like we could fix this problem.
Andrew Wolfe
In fact, by the time I had left skipless as CEO and Founder, the problem had gone from 68% of software projects are late over budget or don’t shift to 78%. A new study was published, and the problem was getting worse. And I was like, but someone has to build something that’s scalable and can actually solve this problem, because if not, then this is a little arrogant, but if not me, then who? And other people had been trying, but they kept missing the mark, in my opinion. We can talk about that later. But I was like, I have to do something in the space and I have to be more scalable if I’m going to solve this problem for an entire industry. And so that’s where Bloomfilter really came out of.
Andrew Wolfe
It came out of one our own lessons I had learned being a software consultant and all the ways projects can fail at hundreds of different companies and the processes they have and the problems they bring to us. But on top of that, a deep burning passion to actually fix this problem, help drive this industry towards professionalism and being able to actually ship on time and on budget.
Brett
Was that hard to leave behind that consultancy then? Because doing eight figures, that’s a pretty good sized business. Was that hard to leave it behind to do a startup.
Andrew Wolfe
Making a lot less money? Now some days I look at my paycheck and think, oh, you’d be nice, but I’m a very mission driven person. And at the end of the day, the mission was always more important to me than the money were making. And so in a way, yes, it was difficult to say, hey, we’re going to take, me and my wife, we’re going to take far less money and we’re going to do this, but this is important. But on the other hand, I was not miserable, but unhappy because I wasn’t chasing the problem I set out to fix. And it wasn’t fixing it in the way I wanted to. And in a way that would be scalable, that would put the industry right.
Andrew Wolfe
And so in another way, it was kind of easy because there’s only so many days you can wake up and go to work on something that you start to believe a little less in because you know it’s not solving the problem you want to solve.
Brett
Makes perfect sense, and that’s awesome to hear. What about the first paying customers? How’d you manage to land those? That’s something that I know all startup founders struggle with in the early days.
Andrew Wolfe
Yeah, were fortunate during my time as a consultant in a previous founding, and my other Co-founders are also skill entrepreneurs. We’ve built a pretty sizable network of people that trust what we do and trust our word. And I don’t ever put that easily because it’s so important that these people trust us. So we just called up the people that I knew had this problem at Skip list and my Co-founders also called their people up that knew that they were running development shops that probably had this problem. Again, when 78% of projects are, quote, failures, everyone tends to have the problem. So it was easy for us to call them and say, hey, I’m building this new platform that’s going to solve your software process issues to help you ship on time.
Andrew Wolfe
It was a no brainer for them to say, yeah, I seen a demo and through that maybe made 1520 calls and twelve of them converted to our first design partners, and they’re still customers today.
Brett Stapper
When you’re looking at a market that’s so big and the problem is so big, I’m sure it can be hard to figure out what that ICP is. What’s that journey been like for you in really uncovering who that ICP is and who you want to focus on? Because I’m sure everyone’s experiencing it sounds like, but who can you focus on and who are you really targeting to?
Andrew Wolfe
That was, it’s actually been the hardest part of this journey. As you said, everyone has this problem, so we had to really figure out who did we want to sell to, well, and not who we wanted to sell too, because just because everyone has the problem doesn’t mean they all feel it viscerally. Software companies, for example, they feel this problem a little less viscerally because they’re going to spend the money either way. So they’re kind of willing to take the bets a little more than, say, a countertop company who’s another one of our customers. So when were first starting out, we actually thought we’d be a PLG type company and it’d be land and expand, and we would try to sell it through product managers and project managers who want these metrics. And as we started talking to people, they were very excited.
Andrew Wolfe
And then I think slowly they realized the level of accountability that would come from the kind of transparency and observability we give into people’s process that doesn’t exist today. And what we found is that people don’t really sign up for more scrutiny. And when that happened, we’re like, well, there’s no way we could sell bottoms up. So we started to sell top down. And that was fortunate, because that’s where my network, I have a network of CIOs and CTOs I’ve worked with for years. That was fortunate. And as we started working with them, we noticed something else, that some organizations were a little too big for our initial platform to support. Not that we couldn’t support a Fortune 500 company ever. It’s just at the time that were working with them, we didn’t have things that could support a matrix organization. Right.
Andrew Wolfe
So you have a vertical reporting structure of vps, a VP of engineering, a VP of design, VP of product, and then horizontally, development teams are structured as multifunctional teams where you have a product manager, designer engineers, and all that. They’re all different managers, and so provides a unique challenge in how you have to architect your product. We just weren’t ready for that level of complexity. So as we found out, were able to whittle it down to about 30 to 300 engineers. When you have that number of people, you tend not to be quite matrix yet, tend to report up through a CTL. And then the people we tend to do best with are agile development or trying to be agile. And they’re using mainly cloud systems. So they’re using systems like Jira and Figma, but they’re using them all cloud based.
Andrew Wolfe
And so that sounds hyper specific, but it took a lot of iterations and a lot of running our heads on the wall of, well, who do we talk to? Well, okay, this customer works. There’s 30 to 300 engineers, but they’re running on premise. Jira. Okay, well, we don’t really want to support on premise products because that has its own problems that comes with product architecture and all that. Ultimately, that’s how we landed on that just really aggressive iteration and talking. We probably talked to 150 different people throughout the process of getting your ICP, and a lot of the people are still. Some of the people are still our pipeline, but we probably got rid of 75 of them.
Andrew Wolfe
I mean, we’ll come back and talk to them again, but it’s a long journey sometimes to find the right ICP, especially when the market’s really big and there’s a lot of different opportunities you can take.
Brett
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Andrew Wolfe
Yeah, well, when we first started, were actually talking about, well, we’re just going to tell you whether your project is doing great or not and show you where you probably have issues with different things. Your team is doing different behaviors. And so we’re very behavior driven and we’re trying to coach people think like almost a career coach or an executive coach, but for your software process that I think worked, but really it didn’t solve the problem that were going after. So then went after just, well, we’ll be basically your operating system for software development. So you put your data in and we kind of show you where everything is. That was great, but it didn’t quite explore the right areas in people’s minds of how problems that they were facing. It was actually through happenstance that we landed on process mining.
Andrew Wolfe
One of our Co-founders, Eric, was a huge fan of Solonis, and he’d worked with Solonis in a previous gig. And they’re a huge process mining in the accounting space out of Europe. He was, you know, this really doesn’t sound like any of those things you’re saying. It sounds like process mining. I’m like, never heard of it. It’s not term that’s really big here in America yet. And so did some research. That’s exactly what we’re trying to do. That’s exactly what we’re doing. And it makes sense the market that no one’s really doing anything in. And so it really helped us move our positioning from this operating system for software development or this process coach to really being, hey, we’re going to help you unofftuscate your process.
Brett
How do you think about your market category then? Is it process mining for software development or something else? What is that market category?
Andrew Wolfe
Yeah, it’s process mining for software development. So we talk to analysts, which we’re in the early days of doing. That’s how we like to talk about our product now people will put us in the value stream space. So there’s this whole category for Gartner and Forrester and all those around value stream, and there’s some products in there that are seen as competitive at the moment. We don’t think we belong in that space. Obviously, there’s one thing for the market to say no, you do, and they still buy your products. So great. Maybe we do. But I feel like those products are going after a different category than we are. I think they’re going after really more engineering productivity and more how are things specifically code and how developers are shipping and efficiency and effectiveness is simply the developers.
Andrew Wolfe
We don’t believe that’s where the value is. We believe that software is a whole process and it has upstream problems and downstream problems. Engineering certainly can be a problem, but tends not to be the biggest problem that most organizations.
Brett
Have you ever been tempted or has it been hard to not just go with what the analysts are saying and take maybe the easy route to be like, okay, we’re going to be in this category that’s established. There’s buyers, there’s a line item. And the reason I ask that is because a lot of founders that I’ve spoken to, that’s what they deal with. They feel like they’re creating a new category, and then they go to the analyst and Gardner will, no, you’re not creating a new category. You need to conform and be part of this existing category. Has that been something that you’ve experienced?
Andrew Wolfe
Yeah. No. The temptations there every day, it can be painful. Run your head against the wall and say, no, we’re different. Here’s why. And spending the time to do that, because you’re trying to sell your product and it’d be much easier if you got judged against products that would be in a category that’s attractive for where people are spending money. But the downside of that is if you’re not in that category and we don’t feel like we are, then you’re competing in a category where you don’t have all the features and functionality that the other people do.
Brett
Right.
Andrew Wolfe
Why would you. Because, yeah, you might have some overlap. The ven diagram might exist, but you don’t have a lot of overlap. And so they’re competing in a feature set. That’s what everything’s being compared to. And you have a small percentage of that. So you look like a laggard. You look like you’re not innovating. In reality, you are innovating, but you’re in a space that they’re not really categorizing yet. And so you have to continue to fight that tide and show why you’re different. And you have to do that every day and say, hey, are they talking about this way? Are they talking about these type of features? Are they talking about these types of solutions? And over time, people say, this is how they talk and this is how you talk.
Andrew Wolfe
Maybe you are different and it does take time and it is very frustrating and it is very time consuming, but you don’t want to compete in a space where, again, you’re never going to win because you’re never going to have the features set the other people have because you are truly different. And so obviously reckon with reality too, if you are in that space. Just because you want to be different doesn’t mean you have to be different. There’s a lot of great businesses in the CRM market. Yeah, Salesforce is number one and they’re like $40 billion in revenue or whatever this year. But HubSpot is doing pretty good. No one’s complaining about HubSpot. And so don’t necessarily compete. Try to create a new category if you don’t have to because then you’re building a new product or new company that’s difficult enough.
Andrew Wolfe
Plus a new category. It’s a lot to take on at one time.
Brett
Just from this conversation it’s very clear you know what you’re talking about with marketing, with positioning. What I’ve found in other conversations with technical founders is for a lot of them, that’s not the case. They’re software developers, that’s their expertise. And when it comes to marketing, when it comes to positioning, they’re lost. Their message is essentially, hey, we’re really good, or hey, we’re the best, or we have these features, different things like that. So how did you go from being a technical developer to being someone who’s so intelligent when it comes to marketing and positioning?
Andrew Wolfe
There’s a couple of things there. My Co-Founder is really good at it and so I’ve got to listen to him and learn from him every day. And you work with that person like that for enough years, you end up just learning a lot. And that’s helpful because I was so weak in the sales and marketing area and I knew that going into it. I studied and I just read a lot of books in the area and absorbed it and then tested out thesis too. Like, hey, maybe I’m going into this pitch, I’m going to try to position this way, right? If I’m raising a series a, I’m going to talk seed route or any route, I’m going to talk to hundreds of investors probably. I have an opportunity now to test a lot of different things. Well, maybe I’ll position it this way.
Andrew Wolfe
Maybe I’ll position it this way. Eventually you come around with like, why does that work? When doesn’t you start to ad test these kind of things? Think about it from a development perspective, right? You don’t know how the code is going to work when you go, you don’t necessarily know to solve the problem right away. What you do know is you can go about it this way and try that. Well, that didn’t work. Okay, come back, try it this way. That sort of works. And you can start to iterate towards learning all of this pretty quickly. And then on top of that, you can also observe, how do other companies talk about their stuff? How do they position themselves? Why do they position themselves? Why does no software work?
Andrew Wolfe
And you can start to research these different techniques and you really start to become illuminating over time, and you start to see the same patterns you see in engineering. I was an engineer for 20 years, so when I see some problems, like, oh, it’s just another one of those types of problems. If you’re familiar with the term from principles by Ray Dalio. Right, it’s just another one of those. And you just pick up a lot of that on marketing and sales, like, oh, it’s just another one of those. And you start to say, oh, well, the enterprise customer is saying these words. That means that they actually are trying to purchase and solve this type of problem. And then you can delve in, ask the right questions, and kind of re engineer some of these first principles in sales and marketing.
Brett
Makes a lot of sense. What about the co CEO structure that you have? We recently had Henrique on from Brex that they’re, I think, a very famous startup that has co ceos. I think Oracle at one point had co ceos, but from the conversation with Enrique at Brex, he was telling me that it’s different for every company. There’s no clear playbook for what it looks like to have the co CEO structure. So how have you guys structured it?
Andrew Wolfe
Yeah, so I hit up the technical side of the house. So I have engineering, product and customer success, and he has sales, marketing, and we split fundraising, although he’s the primary fundraiser. And so the way we like to think about it is I’m the technical one, so I can go in and happy to build a roadmap and do engineering. And I open customer success too, because we’re early enough that it’s really a product function at this point. A lot of times iterating to make your customer successful is building features and listening to what they have to say. Eventually he’ll own it because it’ll turn into a revenue function over time. And then because he’s good at sales and marketing, it has this really beautiful way of working because he’s not untechnical either.
Andrew Wolfe
So he’ll come and help me on product side and I’m one of our better closers at the company, so I can come and help him on the sales side from a tactical standpoint, so we can shift aisles when we need to and if he needs a couple of days off, I can help him run sales marketing, as you mentioned. And if I need to take a couple of days off, he can come to stand up and help provide some product guidance and all of that during my time off. So it’s really been beneficial. I’ve been the guy before where you’re just the CEO and there’s a lot of long nights when you do that. Many more than I have. I have long nights now startup, but when you’re just that person, there’s so many things that have to happen.
Andrew Wolfe
You have accounting, you have to balance your books every week. You have to make sure that you’re top of. If you’re doing all those functions yourself, it can get really exhausting. So I’m very glad that I get to share responsibility and we both get to work in the areas that we’re super strong in while being able to shift into the lanes where we can help and provide unique skill sets. Know, serial entrepreneurs and CEOs tend to build up over time.
Brett
Now, we talked about it earlier that you’re based there in Ohio. Have you ever thought about moving to Silicon Valley and weighed the pros and cons of being established here? Not established here, but really just being based here from a sales, marketing and recruiting and fundraising perspective, has that been something that you’ve battled with?
Andrew Wolfe
It has been a few times in my career. I thought about moving there. In fact, I did live in Seattle for a while. I moved out there because I wanted to live on the coast, but I was really a coin flip between Valley and San Francisco Seattle, and I ultimately ended up in Seattle again. I was an early engineer at Tableau, so that was a great opportunity, and I got to ride that wave for a little while. I would say pre pandemic. It was really pushing me that way. I probably would have done it had the pandemic not happened. It was just really hard to raise money. No one was really writing checks outside of the valley. I mean, there’s some bcs here in the midwest and there’s certainly some really nice ones now, but those were just getting started. Pre pandemic 2018 2019.
Andrew Wolfe
And so it was hard to raise money. It was hard to get the conversations, but now people pretty much are all geographically agnostic in their check writing, so it’s not as important. And talent as well has kind of dispersed a little bit. Not as much. I think if you’re looking, if you’re building an AI company, I think Silicon Valley is one of the greatest, and I’m certainly not a doomer, as some people put it. For the Silicon Valley, I think that it’s a great place. I have a lot of friends out there’s a lot of talent, but it’s less important than it was before.
Andrew Wolfe
And I still think in general, you can build a great team in the midwest, and you can also bring in the Silicon Valley talent and the talent of the coast to the company and start to build some of that. Given how everyone likes to work remote, we’re co hq, too. Eric, my Co-Founder and co CEO, lives up in Chicago, and I live here in Cleveland, so we have access to. Cleveland’s not a huge city, but has some great tech schools near here, and he’s obviously in Chicago, and that has a huge depth of talent itself. So we haven’t run into anything from a talent perspective that we need to do.
Andrew Wolfe
But if I was a net new Founder and I needed to be able to raise money and build a network and be surrounded by people that could help me, I think it’d be a no brainer to move to a place like Silicon Valley where you could build that network, get access to the venture capitalists and all that. But being established as well has helped because I had this opportunity to network over a long career and meet a lot of these people and build good relationships with them.
Brett
That makes a lot of sense, because I feel like that’s the main reason to be in Silicon Valley, right? Is to have those relationships or establish those relationships. So if you already have them, there’s not that much benefit being here. And the cost of living is also insane, I’m guessing, compared to Cleveland.
Andrew Wolfe
Oh, yeah. Yes. I couldn’t imagine the house of living would have cost any of the cities in Silicon Valley. I mean, it’d be at least five x crazy.
Brett
Now, let’s talk a little bit about fundraising. I know you mentioned there that your Co-Founder leads a lot of those efforts, but from the 7 million you’ve raised so far, what have you learned about fundraising that you could share?
Andrew Wolfe
Yeah. However long you think it’s going to take, just double it, especially in this climate. We were lucky. We raised them from pretty big names like Sequoia and all that, but that was also, we’ve had a lot of excess under our belt as a team, so were pretty seasoned people. We struggled with it. So I’d say double the amount of time you think it took. We thought it’d take us about three months. It ended up taking us, I think, six, maybe a little under six. And we knew 65 to 70 vcs that were on first name basis with. So we reached out to all them, some of which thesis we didn’t fit, but were able to test our pitch with them and get feedback.
Andrew Wolfe
So I would say if you think for every million you’re going to raise, you’re probably going to talk to ten to 20 vcs. And I think the last thing I’d say, people, we had actually three lead term sheets and we had turned down people from that because were being really selective to who we wanted to lead. We’re very excited with our lead investor. And the reason for that is you can run into some really jerky people in that space, right? And I’m not saying they’re all jerks because I’m not going to make something a monolith that isn’t. But in general, I think I’ve met more asshole vcs than I have in any other field. And so you really want to be selective because these people, it is almost like a marriage.
Andrew Wolfe
If you’re successful, that seed investor is going to be on your board for probably at least three to four years. And so you’re going to be working with this person for three or four years. And then after that, as long as you don’t have an exit, you’re talking about a seven year relationship with these people. And if you start another company, if you return money, which hopefully you do, then that person is probably going to call you up and want to be the first check. Because why wouldn’t you want to write someone that made you money? Of course you want to get into that person’s new company. So I would say, really, don’t just take the first money, take the best money.
Andrew Wolfe
I would rather raise 500,000 to a million less, had less Runway, but had the right people around me because they really are force multipliers, right? With the right network and the right people that can put you in touch with the right customers and everything else. The million in capital that you didn’t raise could be a million in sales, which is way better, way less diluted, and ultimately it’s going to help you build a way better business.
Brett
Let’s imagine you were starting the company again today from scratch. What would be the number one piece of advice you’d give yourself?
Andrew Wolfe
I would say trust my gut. I think we are playing in this space where we knew we should have been a top down company to begin with, but then we played around with the product led growth motion and we spent three to four months doing that. But we kind of knew deep down that were going to be this transparency tool and this accountability tool, and we knew that. And yet we ignored our gut there. And I think that happened three or four times where if we had just did what we thought we should do to begin with, we probably two to three months ahead of that. I think the other piece of advice I’d give is actually ship sooner. We spent a lot of time with design partners trying to build the perfect product and we had done this before.
Andrew Wolfe
It’s one thing to say, hey, ship fast, you should be shipping. If you’re not embarrassed by your first product, you’re shipping too slow. And then to do this journey for the third time and still make that mistake. We shipped a product I think was really good for v one and I certainly am proud of what we shipped. But we could have released from our design partner program much quicker and gone to a much broader audience and honestly started getting punched in the face by the market much quicker, which would have, I think, increased our iteration speed and probably reduced our burn quite a bit to get to the state of the product we’re in now, which feels pretty close to product market fit. But we won’t know that until we see our sales numbers for next quarter.
Andrew Wolfe
But it feels like we’re getting there with the kind of response we’re getting in the market.
Brett
I love that line. Getting punched in the face by the market sooner.
Andrew Wolfe
Yeah, I mean, that’s what it is. You’re going to get told no a whole bunch, right? By VC, by customers, by people you like, by people you don’t like. And it’s just, how many times can you get told no and stand back up and get back in the game, get back in the arena and keep fighting? I mean, that is a story. Because for every no you get down the road, that’s a yes, right? And only through the no’s do you learn where you’re not doing well. Well, I’m not buying that. Why aren’t you buying that? Well, you don’t have this feature. Okay, what if I can get you that feature in a month and I’m still not buying it?
Brett
Right?
Andrew Wolfe
All those no’s are how you iterate. I mean, yes is cool and it does make you feel good, but the yeses are the things that don’t really help you get better. The no’s why are being told no by BCS? Why are we being told by the customers? That’s where you start building a real company. And the more no’s you can get and the sooner you can get them, the better off you are because you’re accelerating to a yes.
Brett
Final question before we wrap here. Let’s zoom out three to five years into the future. What’s the big picture vision that you’re building here?
Andrew Wolfe
Yeah, in three to five years we really want to have good pre establishment that we call it. Right. We joke around internally that we’re fighting the agile industrial complex. And in our mind we have a lot of people talking about how we need to double down on what we’re doing today. We’re not doing enough of it. And I know we’re winning. When people can start to say and look at data and say, hey, what we’re doing isn’t working and we can start to see the initial market reaction to say, hey, wait a minute, we don’t need more agile. We need to be doing things differently. We need to be interrogating our process with the data. We need to be doing that. And when the market starts talking about that’s one indication I know we’re winning again.
Andrew Wolfe
That’s towards our mission in terms of what we want to achieve. Obviously we want to have raised probably three or five years from now, would you say five? Probably a pretty decent series b. We want to be a publicly traded company. A lot of people say that because that’s the right thing to tell VCs Pro tip to every farmer listening, when they ask you what’s your exit plan? Just say IPO. It does not matter if you want to or not. There’s one right answer. Just say that’s your pro tip. But we really mean it when we say it. We all have had a nice aqua hire. Never say no because you never know what’s going to happen in three to five years. And certainly in the world situation we’re in now, we don’t know what’s going to happen in three to five weeks.
Andrew Wolfe
And so that kind of stuff can happen. But assuming everything goes the way to plan, we want to take this company public. So three to five years, we want to be eyeing probably within a couple of year forecast to saying, yeah, we’re going to take the company public and knowing what we have to do to get there. If we have those two, one from an economic one, from a mission standpoint, I know we’ve done our job and hopefully that 78% number is starting to come down. Right. Mackenzie and Harvard are talking about how software is getting better instead of getting worse and how people are starting to figure out how to become better at building software. I mean, it’s such an existential problem.
Andrew Wolfe
Every company on the planet is a technology company, and yet 70% of them, the projects that they’re going to invest in, are not going to work. And it’s just an insane, baffling statistic to me. I mean, imagine if 78% of planes crashed. You get on a plane like, no, 78% of surgeries killed you. No one would get surgery. And yet every year we know this statistic going in. Talk to any CIO, they’re actually joke and say it’s that low, and yet they’ll go and spend 30% more next year, and they’ll not only accept it, they’ll spend more in it. It’s crazy. And so we want to bring that number down. And ultimately, in three to five years, we started bringing that down, providing an example of how the industry can think, can act differently.
Brett
Amazing. I love the vision. And you’re going to have to give us the first interview there on IPo day. You have to keep us in mind.
Andrew Wolfe
Absolutely. I always keep the people in mind that we’re there and supporting the vision and the mission the entire way. Those are the fun people, the people that join after the bandwagon, like, all right, that’s fine. You’re welcome. You know that you’re late.
Brett
I love it. Andrew, if there’s any founders listening and that just want to follow along with your company building journey, where should they go?
Andrew Wolfe
So I have a Twitter. It’s Andrew W. Wolf. That’s my Twitter handle. I don’t really tweet. I’m not a really social media guy. And then we’re Bloomfilter on Twitter or Bloomfilter on LinkedIn. We use LinkedIn, admittedly more since we’re a B2B SaaS company. But if you want to follow along, those are the best ways to do it.
Brett
Amazing. Andrew, thanks so much for taking the time. I really enjoyed this conversation. I know it’s going to be a hit with our audience as well.
Andrew Wolfe
Yeah, thank you. I appreciate it.
Brett Stapper
Keeping duds this episode of Category Visionaries is brought to you by Front Lines Media, Silicon Valley’s leading podcast production studio. If you’re a B2B Founder looking for help launching and growing your own podcast, visit frontlines.io podcast. And for the latest episode, search for Category Visionaries on your podcast platform of choice. Thanks for listening, and we’ll catch you on the next episode.
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