In this episode, Zenos Schmickrath (former CTO Hmlet, current director at SEA Founders) talks about:
- Why founders need to build new skillsets as their startups grow to beyond 10 people
- What to look out for as your startup starts to scale
- Why mission and vision statements become even more important in a larger organisation
- Why founders need to find a way to build a support system for themselves
- Why he is juggling 5 different projects right now, and
- Why he is passionate about nurturing the founders community in Southeast Asia
About the guest
Zenos Schmickrath is a serial entrepreneur who has built companies such as Hmlet, Lens Advisor, and Pageworthy. He is currently serving as a director of SEA Founders, helping build a founders community in Southeast Asia, while experimenting with multiple new ideas and ventures.
Find him here:
Books, tools, people, frameworks mentioned in this episode:
- Lens Advizor – https://apps.shopify.com/lensadvizor
- SEA Founders – http://seafounders.org/
- Four Hour Work Week – https://www.amazon.sg/4-Hour-Workweek-Anywhere-Expanded-Cutting-Edge/dp/0307465357
- High Output Management – https://www.amazon.sg/High-Output-Management-Andrew-Grove/dp/0679762884
- Hmlet – https://www.hmlet.com/en
- Gumtree – https://www.gumtree.sg/
- Craigslist – https://www.craigslist.org
- Miro – https://miro.com/
- Click Up – https://clickup.com/
- Y-Combinator Startup School – https://www.startupschool.org/
- Anna Gong – https://sg.linkedin.com/in/annagong
- Perx – https://www.perxtech.com/
Zenos Schmickrath 0:00
When you’re providing a certain service, you need to learn how to scale both that service and the company at the same time. And what I mean there is that, typically the founders, the first couple of people are the ones that are doing that work. Like they’re actually getting out there, getting their hands dirty, getting the work done. But that’s a very different skill set than growing a team to 10, 20, 50 people, and then serving the clients in a different way.
Ricky Willianto 0:28
Taking a company from zero to one is very different from growing a company to 100 people team. As a serial entrepreneur Zenos is familiar with this transition. He realised that the skill sets required in building early day startups are very different from what’s required in a scale up, founders need to pay attention to the shift in their business. And having gone through this process multiple times. Zenos knows exactly what founders need to do when faced with this critical tipping point.
My name is Ricky Willianto, co founder of Ravenry, and the host of the Growth Multiplier podcast. Through this podcast, I hope to uncover the pathways, startups and companies have taken in their journey of growth, share some stories from the trenches, and hopefully identify patterns and hacks that can be replicated by businesses in Asia and the rest of the world. I hope you enjoyed the show.
Hi, Z. Thank you so much for joining us today on Growth Multiplier. Before we begin, can I get you to quickly introduce yourself and tell us a bit about who you are and what you’re currently doing?
Zenos Schmickrath 1:32
Absolutely, thank you so much for having me.
So my name is Zenos. And I am a serial entrepreneur. I’m ex-Microsoft, I worked at Microsoft for about six and a half years before I went on to start my entrepreneurial journey. And through that I founded about seven different companies, some with some spectacular failures, and a few others with very good success. And I think I’ve learned some lessons along the way that will hopefully be relevant to your listeners out there.
Ricky Willianto 2:02
Sounds good. Thanks for that. So tell us a bit about what you’re working on. Right now I know that you’re working on a lot of very interesting projects, some might be stealth, but we’d love to hear some some of the ones that you can share.
Zenos Schmickrath 2:12
Sure, I’m very, very happy to share, I’m working on five separate projects right now. And really, this is all COVID related because I was planning to take a bunch of time off and was going to travel the world. But with COVID in place, I decided to start working on small projects, and those have ballooned into big projects. So these five projects are one is Shopify SAS company. And that’s called LensAdvizor. Another is a construction company in the US. The third is a media company in Singapore. And fourth is I am director of one of the board of directors of SEA Founders an organisation that accelerates the growth of startups, particularly startup founders. And fifth I’m doing a bunch of equity investment strategies are mostly around options.
Ricky Willianto 3:05
Wow, okay, I love how you have a lot of background noise just for the audience out there just for you to know it’s raining really heavily in Singapore, and we can hear it from our apartments or respective apartments. So I literally just saw, like, a bolt of lightning, you know, like reflected on this face just now as is introducing. And so it’s very dramatic introduction.
Zenos Schmickrath 3:25
So you’re going to hear the sound probably about now. It’s going to come over, I can see the lightning like going off in the distance. So it’s definitely going to be in the background.
Ricky Willianto 3:34
Yeah, great. Great. I think that that makes for a very nice intro, you have a really nice backdrop call. So z, you’ve done like an amazing job building a lot of different companies right in the region. And I think what I love to hear today is maybe on like, you know, how you started all these companies? Right? So I think for a lot of founders, the starting point is always been the most difficult. So give us an idea about how first, how did you kind of get inspired to start some of these companies, right? And how was the early days like when you try to turn those ideas into the first executable, like prototype or you know, like a business that actually makes money?
Zenos Schmickrath 4:12
Sure, I’ll say that I was always interested in creating businesses and basically in making money. And some of my first businesses were at school. So in high school, I wanted to get over to Japan and in order to do that I needed to make money. And I ended up starting a candy business at school with the blessing of my you know, school counsellors and teachers and whatnot. And I ended up making like 30 $40 a day off this little candy business, it really wasn’t the right way to make money for where I wanted to go, but it opened up my eyes to what like business could be and kind of just how to hustle and make cash and I kind of took that with me as I went through all of my rest of my life and my journey. So I’ve always started businesses on the side. While working for Microsoft, I started a motorcycle parts business. And then as well, an automotive resale business where we buy cars, fix them, resell them. So always kind of just thinking about how to either make money, provide value to a market, find some arbitrage opportunity, whatever it was, there’s, you know, there’s value to be created and had when people will pay for that. And that was always really interesting to me. And so, as I was working through Microsoft, I kind of realised that corporate life wasn’t for me, I did not want to stay in this race, per se. And I wanted to venture off on my own.
Ricky Willianto 5:39
And what what specifically about being an in an organisation that was an S appealing or wasn’t right for you?
Zenos Schmickrath 5:47
You know, that’s a really good question. I think most likely, it’s the authority, or the like, inability to make your own broad decisions that broadly impact things like you’re able to do your job and to create value within the scope, that scope, but it’s always a limited scope. And I always wanted to expand the scope, but I wasn’t able to do that, within the roles that I could find. And I noticed that if I wanted to have that, that sort of influence on something that I would have had to rise in the ranks up and say to like division head of MSN, or something like that. And I’m like, okay, that’s like a 15 year path.
And right at that time, as well, we’re seeing, you know, tonnes of companies started up and there was a lot of buzz around startup companies the.com, bust had happened, the boom and bust. And so there were still this kind of energy that, you know, you could make it as an entrepreneur, if you decide to build something. And that’s what I decided to want to do.
Ricky Willianto 6:47
Sounds good. So tell us about, like, you know, what, what ideas you had while you were at Microsoft, that, you know, got you started in this? I mean, like you started much earlier than Microsoft, but you know, what are the ideas you get while you’re at Microsoft?
Zenos Schmickrath 6:59
Yeah, so at Microsoft, I wasn’t thinking so much about really the internet business world at all, I was thinking very physical business. So I did a lot of arbitrage opportunities, I would go to auctions, buy the physical goods from these auctions, and resell them on eBay. And I was making pretty good money doing this. And then I realised along the way, in fixing my own motorcycle, that there was a really big opportunity on eBay and used motorcycle parts. And I ended up just scouring Craigslist finding these motorcycles that were for sale that were rundown, weren’t working, and I would go pick them up, take them apart, sell the parts for, you know, maybe 500 – 700% of the cost of acquiring the model. Oh, okay. It’s a nice budget. Yeah. So I was like, I was making about $1,000 a week doing this. And this is just like, off to the side of what what my regular day job was. And because of that, I started to realise that, you know, there, there is something that you can build, and there’s small businesses that you can build, and I, this incepted the idea into my head that I want to be able to build a business that can run itself, you know, you can certainly create value by doing a whole bunch of physical things. And there’s always going to be that opportunity in any industry. But can you grow it big enough that there’s people working for the business, and you as the owner don’t necessarily have to do work every day. And I think this is along the lines of Tim Ferriss four day or four hour workweek and things like this also coming out around that time. And I’m thinking, Okay, like, what do I really want to be doing building? So I decided that, yes, it absolutely had to be a business. And I decided to take these skills that I had, through, you know, years of software development. And could I apply that to accompany, and the easy application was for creating a website that sold goods. And so I started selling auto parts, I went to distributors got got the business up and running and picked up the parts and then sold them online, both through eBay and other channels. And that went to okay, but it was still very manual. And I ended up abandoning that, so that I could move around the world, and so kind of started a new journey of businesses. So a big part of what you’re trying to do is to find a business that, you know, doesn’t require you as much to be hand holding to be manually processing things and operating it is that kind of like the kind of business you were trying to build. Yes. And I figured I could build this in any vertical. Like I, I could grow this motorcycle parts business, you know, hire 10 people, train them on what I was doing, they could do it and then I could step away from it. And it could just, you know, turn out cash, but that never really happened. I never really got it to that level. And so I knew I was missing something. And what I decided to do
Then was to go into building internet businesses instead of the physical goods business. Okay,
Ricky Willianto 10:06
so tell us a bit about some of the internet businesses that you’ve built so far.
Zenos Schmickrath 10:10
Sure. The first one that I built was one called PageWorthy with my brother. And this went pretty well, we ended up being an e commerce shop development dev shop, where we would do custom development for companies and build their websites out our goal, always along that line was to build our own websites, but also generated revenue whenever they were. And we figured that along the way, we would find some opportunities. And we never really did. We’ve been so busy, like building things for other people, that we’ve never really built things for ourselves.
Ricky Willianto 10:45
So this is like a deaf house, essentially.
Zenos Schmickrath 10:47
Yeah, and this is back in 2006 2007. iPhone just got released that day, or that we’re doing this. So there wasn’t this concept of the App Store at this time. It really was like ecommerce, web shops, you know, finally, people were buying things online, willing to swipe their credit card, and we were right in the middle of all of that. So we made really good money, but it was so labour intensive, and we never could grow it big enough to be completely autonomous.
Ricky Willianto 11:13
Okay, what do you think were the things that were holding you back? Was it? Do you think it’s because it’s people related? Or is it because you think the scalability is on the channel or finding clients? What was it that was holding you guys back from growing?
Zenos Schmickrath 11:27
So really good question. I think that when you’re providing a certain service, you need to learn how to scale both that service and the company at the same time. And what I mean there is that, typically, the founders, the first couple of people are the ones that are doing that work, like they physically or either, or programmatically, or however they’re delivering the product. They’re actually getting out there, getting their hands dirty, getting the work done. But that’s a very different skill set than growing a team to 10 2050 people, and then serving the clients in a different way. And I realised at that time, like we just didn’t have that skill set. And it was taken us a long time to learn it. Like how do you delegate, and it was really, really tough skill. And one that I’m still working on to this day, like efficient delegation and proper management of, of your workforce is something that I think is absolutely critical. And as a founder, you almost have to learn how to do this as quickly as possible, while at the same time still fulfilling the needs of your customer. So you have to learn skills in this area that might be very foreign to you, because you’re so used to just delivering the product and getting stuff done. So so I think that was our major impediment that we didn’t know how to hire, we didn’t incorporate new people into the team, and then scale that out for as a as a people business. Because ultimately it would have been, we need some PM, some designers, some dev some product managers, and then taking on new roles this way, or taking on new clients through a kind of systemized process. And we never got to that point, simply because we were so busy building e commerce sites for the clients that were already lined up waiting for us to do it. So we could never focus on the other side of the business.
Ricky Willianto 13:14
I think in the early days, it’s really important to be able to collect, get your hands dirty, making sure that you are interacting with your customers. And also, at the same time figuring out and constantly thinking about ways to scale yourself right at the beginning is just thinking about, how do I replicate me into your means that can do all these things that I’ve been doing, right? How do you evolve that muscle over the years? Because you’ve been able to scale? Like, you know, into teams, 100 200 people, right in some of your ventures,
Zenos Schmickrath 13:43
I still feel like I have so much to learn that. I mean, there’s this book, right? Like, what is the name of it? Let me get the name of it for you. I’m reading it literally right now. So it’s high output management. And I’m sure that you’ve heard about it, and
Ricky Willianto 13:58
this very popular leadership management book.
Zenos Schmickrath 14:00
Yeah. But it’s, this set of skills is something that I never went through. So what I was always very good about good at is getting a startup from zero to one where you have an idea, you need to build something, get your hands dirty, and create it and then scaling it is a whole different thing. So I feel like I’ve gotten better at it. But I still think this is most of where I also like my personal journey is, is how to get very good at scaling teams rather than starting the company itself. So there’s a little bit of both, but over the years, I think I just had to get a little bit better at it, given the number of companies that I started. And then the number of companies that started to succeed and and once you start to succeed and you find some product market fit, you have to do something, you have to hire people, there’s no choice. So you just have to learn how to manage people.
Ricky Willianto 14:51
And which point in time do you think is most critical for people for founders, especially to realise that they need to let go and you know that delegate and also start hiring for growth. Because I think that transition is not always very clear right now that you’ve done like a zero to one, and also a one to Series B, you know, journey, I’m sure you have a lot of insights on that a few,
Zenos Schmickrath 15:15
I would say almost immediately, you need to learn how to replicate yourself in a very narrow vertical. So whether that’s your accounting, or, you know, front end development or design, whatever that is, or the project management, you need to hire for that role. And when you’re a small team, it’s almost like that person can be an extension of yourself. And that’s relatively easy to manage. And you can still get your hands dirty, and get in there and get work done. And I would say, somewhere around the 10% mark, things start to get quite difficult depends on who your co founders are, and kind of your team dynamic. But at that point, if you start having to silo the responsibilities, and each of the people that are working with you are also starting to need to hire people to take on their own work. And around that point is when I think it’s really critical for a founder to step back and think, where is my time best utilised? Like, is it actually and tweaking the code and making these changes? Or is it in in giving responsibility to, you know, my new CTO in order to be able to do that on their own? And then me worried about like, the finances, the fundraising the all the other things that a company needs to go through? And yeah, I for me, in the companies I’ve started, this is about the 10% mark, that you really have to start thinking about, how am I going to grow this business from 10 people to 100? To 1000?
Ricky Willianto 16:50
What was what was the most important thing to kind of like, immediately do so I’m in a bit of that situation as well. Right? We are about like, 1112 people now. And we are in the process of building processes, very fun in in a startup, you know, but I think for us that realisation was I feel like it came a bit too late for us, we I could have like, you know, built a lot of these things much earlier to help me, you know, scale and also to reduce some of the issues we have. But I think for you, what are some of the most important things to do immediately, once you hit that point of? Oh, no, I need to hire a lot more people like what are the some of the key steps that you know, you would recommend people take?
Zenos Schmickrath 17:30
Really good question. I think first of all, make sure that your mission is incredibly clear, and make sure you have your values down. Because pretty much nothing else matters in a way like everything flows from that mission, like what what is this company really trying to accomplish? Or what is the purpose? What are they trying to do, and it could be something really simple like, if you’re a vending machine company, your your purpose is to put as many vending machines out there and to satisfy customers when they’re thirsty, like, Okay, let’s do the best job of making sure that happens. But other companies, of course, have different missions. And if you have that clearly defined, then everybody you hire will be able to get behind that mission. So that’s number one. And it can be a little bit murky when you’re at a small startup size, because you’re not quite sure what you do. Like, and maybe you need to pivot. But pivoting early is easy. When it’s like three, four people, you get everybody in a room and you say, Hey, I think we should all work towards this direction. And when you get 10 people and suddenly you can’t get them all in a room at the same time, and three people don’t have the new mission statement, and they’re working for the old one, that becomes really, really difficult. And then scale that up to 100, you know, where half of your organisation or even sometimes three quarters of your organisation isn’t working towards the core mission of the company, as you’ve defined it, because they didn’t get the memo. So number one, define a clear mission. And then number two, you as a founder, learn how to delegate. And I think this is it’s one of the most difficult things for me to do. I’m, I’m an engineer, I like to get in there and just like make things happen. I like to tweak settings and you know, deliver things to the customer. But once you have that mission defined, once you have the traction, you need to let other people get in there and fulfil that mission. And your goal. And your responsibility is the growth of the company and to make sure that this company can live and survive and thrive and provide for all the people, both the customers and the your own team. So I felt like at this point, it’s all about giving responsibility to people, holding them accountable and making sure you can also do on that scale. So yeah, I feel like that was a big learning for me. Yeah. transition.
Ricky Willianto 19:46
How big was a like, how big is the biggest team you’ve ever kind of like, you know, manage or built, you know, in your startups?
Zenos Schmickrath 19:56
Really good question. So it all depends. I would say in my last company, which was Hamlet, we had teams that were like 3040 people that, like operations team could have been more. But it was, it all depends on what the team needs to do and how much manpower you need to do it. But that. So, typically, I think that small teams are much more effective at getting things done. But it all is like, what is the purpose of that team? And what are they trying to do? So and so But back to your question of like, team size that you’re managing? I also don’t know if that’s a really good metric, you should look at how many people Am I directly managing? And then how can I impact their work in a good way? And how can I get them the right direction, because you can manage a team of 1000 people through your direct reports, right. And that should only be probably six or seven people that are directly reporting into you. And you’re guiding each of those things. And so that at each stage of the game, you need to get just like, step up into kind of a new overview level and say, I’m giving responsibility of this entire division to this person or this entire problem set or whatever it is, and in trust that that person can do the work in the right way. And that’s really tough for me. Yeah. Why
Ricky Willianto 21:13
was it tough? Why was it tough to kind of like climb up that layer and be like, instead of a doer, now you can like a manager and overseer, right? So what was the toughest thing for you, when you had to call it take on that role?
Zenos Schmickrath 21:26
I think it’s holding people accountable for me. So I’m trying to set goals and set the KPIs, and I kind of just trust that people will do. And, and then a month later, I’m like, hey, it’s done. Right? And it’s like, oh, no, we got busy doing something else. And I’m like, Oh, no, you know, like,
Ricky Willianto 21:46
that happens all the time. Right?
Zenos Schmickrath 21:47
Yes. Yeah. And so this was tough. For me, it’s like, how do you not micromanage and yet lead people in, in a good way, give them responsibilities, so that they feel like they’re valuable to the organisation beyond being a cog in the wheel. And yet, still make sure the organisation is on track and, and hold people accountable for what they say they’re going to get done. That is,
Ricky Willianto 22:08
that is a really hard balance to do, though, because I think like, for me, I care a lot about like, making people feel like they are able to contribute, and, you know, give them a bit more leeway to do things that they believe is a priority. But at the same time, there are certain things I want to get done, you know, as like, as a as a founder, right? So how do you feel that balance that sense of autonomy for your team, but at the same time still, like rein them in a little bit when they go all over the place and try to do things?
Zenos Schmickrath 22:40
I think the most important thing is to get people to commit to what they’re going to do. And a lot of times this comes back to setting your objective, setting the KPIs, like if you’re using okrs, or KPIs, or whatever metric you’re using, if, if you hold someone, if you get someone to give you what they’re promising to do, it’s much harder to back down from that, like, so if I say, I promise, I will get 20 new signups this week, like and I’m going to make 20 sales, and you make three. Well, what happened? I mean, if you make 17, you can be like, okay, we didn’t quite reach it, how do we improve, and you can work on an improvement basis. But if it’s that it almost didn’t happen at all, then you need to take a closer look. Right? And certainly, there is some micromanaging. And and sometimes that’s important to do, because it’s a learning process, right? You want to be able to impart your knowledge, your strategy, the way of doing things. And that can be the early stage and typically should be where you’re spending a lot of time with this person in parking into them, this knowledge of how the organisation is run and how to get things done. And then if they still can’t meet those objectives that they’ve been committed to, then it’s an easier conversation to have, which is, instead of this amorphous, like, Hey, I don’t think you’re a good fit, or something like that. It’s more like, Hey, you, you committed to these things, and you did. So I always found it was, for me most important to get commitments from the person that was doing the work. And then I clearly understand what’s going to be done, they clearly understand their responsibilities. And within that sphere of responsibility, they can they can do it however they want.
Ricky Willianto 24:25
I want to hear a little bit about you know, your experience as well, like growing the business, not just you know, the team, right? You’ve done a lot of zero to one businesses. So tell us a little bit about the early days and how you’ve been able to get your first few customers and how is that like for you as a founder, who’s also building a business and a product?
Zenos Schmickrath 24:45
Sure. So specifically, I’ll like narrow down a little bit on Hmlet in this scenario. So this this was a much more physical business than the internet businesses that I was trying to get. Going to share a little bit. What Hmlet is in case people don’t know? Sure. So Hmlet is a co living company. So it’s residential real estate. And what it does is that allows people to easily move into a accommodation in a new city that they’re at and has a plug and play environment. So very flexible, and very convenient. And typically, you would be living with other flatmates that you’re matching, and the company grew to be quite a big company, both in Singapore, Hong Kong, Tokyo and Sydney. And we had about Well, before the pandemic, it was about 100, and, you know, maybe 170 180 employees, I’d have to look, look that up. And we went through our, our Series B earlier that year, as well and raised about 40 million. And so it was, and still is a company that has a lot of value in the market. So growing that company and the early stage, it was really just fundamentally serving a customer’s needs, like first recognising that it was there, and then how to solve it. And I think that this is so incredibly important that and a lot of founders kind of skip over this stage, which is, how do I take this idea and turn it into a company? And the fact is, like, most ideas are just kind of crap. They’re not very good. And so how do you validate that idea and whatnot, in this case, it was like Hmlet was a very easy idea to validate because people needed places to live, and people were doing it in the market already. So it was simply how do we make this a little bit more convenient for people to move into a home once they arrived in the city? And sure enough, as soon as we started some properties, quite a few people were taking us up on that offer. And we were just another solution in the marketplace at that time. And so as we started to have more customers, we got to know a little bit more about them. Like what was it that was driving them? Who were the people that they wanted to live with? Why were they choosing to live with others? Was it because of the price point? Was it because they needed something flexible and convenient? Was it that they wanted the community
Ricky Willianto 27:18
and what was it that was most important to them,
Zenos Schmickrath 27:20
that made them choose Hmlet over the other options, a few different things first was like the reputation or the that you were dealing with a company, not an individual, there’s some horror stories out there of people renting a place and then never getting their deposit back. Or they absolutely like hate the people that they move in with after a while, and but they can’t do anything about it. Because they you know, signed a contract that was too long. So typically, it was one that they had a lot of assurance, working with someone that had multiple locations. And you know that that should any problem arise, they had someone to go back to and talk to, rather than maybe the person that they were already living with. And maybe the problem was with that person, right. So we provided this like layer of safety, and kind of that would back someone up if they needed help. And then the second part was that we were more flexible in general than most of the other offerings in the market. So we did a bunch of research to understand like, what the number of months, like most people were willing to sign a contract for. And, you know, most people wanted the flexibility, even if they never exercise it. So that they they wanted to three month contract, even if they were going to live there for two years, so that they can move out anytime. But just that knowledge, you know, gives you a whole bunch of comfort. So so we dove in, and we figured these out over time. But I’d say at the very, very beginning, it was simply that it was flexible, easy, and you’re dealing with a company rather than a person.
Ricky Willianto 28:54
And how do you grow it initially, because the real estate market, especially in Singapore is quite a competitive market. There’s a lot of real estate agents out there trying to like find tenants for landlords, and it’s very relationship based. It’s very in person. How did you as a company, you know, managed to, you know, out shine a lot of this individuals trying to snag up tenants from the market,
Zenos Schmickrath 29:17
I would say blood sweat and tears, but lots of relationship building as well, on our part, convincing landlords was particularly hard that, hey, we’re going to give you this rent, but we’re going to rent it out to other people, and we’re going to make more money than you could have done it by yourself. Right? That that was a pretty hard sell in the beginning. Because who were we just like, you know, a couple guys that were, you know, talking to this person. And then a whole bunch of trust also has to come on board like, Are we really not going to put in 12 people into this apartment, like are we really who we say we are. So that reputation was a big factor for us in the beginning and building trust in the market. And so we had a whole bunch of rejection at first were we weren’t able to find the properties. And then on the client side, we also just had to make it happen. You know, it’s the design, finding the furniture, finding what customers wanted, making sure that they we were signing leases with them that they wanted. And so in the beginning, it was all about flexibility on our part, like doing whatever it took to get someone to be in that room and renting from us.
Ricky Willianto 30:24
Do you do that a lot of those sales in person, do you actually kind of like do you list your property on like the marketplaces like, how do you do it? And in the very beginning, in the beginning, very scrappy.
Zenos Schmickrath 30:36
Yes, like, we did a whole bunch of word of mouth. So we’re telling all of our friends what we’re doing. Anybody want to move in, make sure they come to us first. And then we advertised where we could for free. So on, say, Facebook, Gumtree, Craigslist, wherever it was, and yeah, finding finding members wherever we could, that was, that was what I actually was doing in the very beginning as well. So I did all of the initial sales. So until until we had like, 100 members on board, you know, I knew every single one of them, because I, I rented by members, you mean the person? tenants? Yeah, the tenants renting? Yes. Correct?
Ricky Willianto 31:14
And how do you can like scale that then, after the initial days of like, you know, doing it scrappily, you know, in person through friends through word of mouth, you have to find a way to collect scalably. Finally, build a sustainable pipeline, right? How do you do that?
Zenos Schmickrath 31:28
Yeah, actually, this was a really big problem for us. It was like if we, if we bring another 30 or 100 rooms, on in this month, how do we even find people to rent these rooms? And how do you build that pipeline? And I’d say we just did it over time, it was that we finally hired more people into the organisation, and kind of imparted into them the knowledge of how to be a good salesperson and a good community manager and how to handle all of the new tenants themselves. And that was all about building an organisation that can handle the amount of rooms that we end, at 100 rooms, you can have this be one to two people. And then as you scale up, it’s almost linear, unless you can figure out good processes. And so your goal at that point is to figure out better processes. So you don’t need to hire linearly. And you can start getting you can start leveraging scale. And that was a really difficult problem for us. At the very beginning, we did end up, you know, buying Facebook ads or, or other sort of advertising so that we were able to get a good pipeline at first. And then over time, I would say reputation grew and more people became knowledgeable about what coliving was,
Ricky Willianto 32:41
you’re helping a lot of founders as well through this organisation called SEA Founders to do the same thing, essentially, what are some of the things that you see as challenging for founders, specifically in ASEAN, and maybe before you go into that, introduce what co founder is, as well, just so that we all know, you know what you’re talking about? Sure.
Zenos Schmickrath 32:58
So SEA Founders is a community of of tech, mostly tech founders, where we are all series A plus, or have gone through this, like series A plus. And the the whole rationale behind this is that once you hit series A, or have raised about a million dollars, you start having some really difficult scaling problems. And going from a, you know, making $10,000 a month in revenue to making $100,000 a month and making a million a month, you start hitting some very difficult problems. Typically, these problems are solvable, if you have the knowledge about how to solve them. The really big issue is that most of the founders that get to the stage are doing it for the first time. And if you’re this first time founder, how do you solve some of these difficult problems, and a lot of times founders, either they just like muck their way through it, they get some help from their investors, or, or they get some help from friends. And what we saw was that systematising, this a little bit would really, really help founders, like I myself after I joined, I was like, I wish I get 1000 times, but I would have had this right at my series A be like and to be part of this community, because it would have helped me get through so many of the challenges that happened after I raised that first million dollars.
Ricky Willianto 34:17
So what are the one or two challenges that are most prominent among this series? A founders? Good question.
Zenos Schmickrath 34:23
So that like number one is, like you say, once you’re going through growth, like how do you maintain that growth? I mean, every investor wants you to be on a hockey stick graph. And is that even possible? And how do you scale the company up that way? So some of them some of the problems can simply be like, how do I grow a sales organisation? Or how do I grow my marketing funnels in a in a really great way. But there’s a lot of other problems that might happen along the way that are less often but can be very, very distracting in terms of time, energy and your ability to manage the company and this could come In the form of like an acquisition offer. So you’re doing super well, your series A, you’re, you’re like rocking it. And out of the blue, your biggest competitor or huge conglomerate comes over and says, Hey, we’ll we’ll give you $100 million for your company. And you’re like, oh, man, what do I do? You know, like, do I take the money? Is that the right time? I’m growing so fast? My one of my investors says, No, the other investor says yes, like so and, and that ends up sucking up a whole bunch of your time. And all that time that you’re not spent working on growing the business and doing the things that you’re supposed to be doing to make your company successful. And so these things can kind of come out of, like, left what feels like left field, but it’s actually just par for the course in business as you start to grow. But because it’s your first time, you don’t know how to navigate your acquisition offer and how to tell them no, or come back later. And, and that’s just one of the things right? Or another could be like, how do I go about negotiating with banks to get paid millions of dollars in in debt? for my company, like, I just two years ago, was the first time I was like begging for the million dollars from the VC. And now I have a whole bunch of VCs coming at me. But how can I make sure that I don’t dilute my, you know, equity in my company? And how can I take that in a good way, where I don’t put my company in danger, like, these are like typical problems that you come across, but because you’re always dealing with it for the first time. And it tends to distract from the core business proposition and the growth of business. And so we want to make sure that founders can get ready answers or or a community around the founder that has gone through those same types of issues in the past, and are able to help a founder make those decisions very quickly. And also the kind of a framework about how to think through these types of problems.
Ricky Willianto 36:57
And so I think that to two different things you mentioned, one is more universal, which is how do you continue growing as a company, once you hit like a series A, which, at which point, you’re probably really growing really fast, and you need to maintain if not growing even faster? The second is more of like a secondary ad hoc kind of issues that crop up, for example, acquisition, you know, like, you know, financing. So maybe let’s talk about the more universal core issues, right that all founders face, how do you can I help these founders to come like healthily and sustainably grow their business.
Zenos Schmickrath 37:31
What we try to do is organise everybody into small pods of founders. And these are five to 10 founders that meet every single month, and are really each other’s support network on a broader scale. We are doing master classes every three months, every quarter, where we bring outside help, or outside founders that have already scaled even beyond the series, B, C, D stage, and they have a entirely different learning. So it’s like, what is the next step in your journey? And what are the things to look out for, because we may not have all of that collective understanding within our group yet, because we’re all still like series A B founders, I think, is really the community, the camaraderie between people that is extremely helpful. And because of that, we’re able to have really honest, open sharing about things that you may not be able to talk about. And there’s also that understanding that everything is private, confidential, and that we’ll we’ll be able to talk through difficult problems without worrying about, you know, what is said. And then you can have these open honest conversations and really great feedback come back that helps you make the decision.
Ricky Willianto 38:40
I think this light by founder founder communities, great because I think a lot of the experiences founders face are quite unique. And it’s hard for other people to empathise, and even like, think of a good solution, or the right things to say sometimes even to get your view on this. Right. So how do you see like, you know, Southeast Asia, growing in the tech ecosystem, in providing founders, the right support system to be an entrepreneur, why would you go for resources if you’re a founder or CEO? And yeah, like, what’s your thought overall about like, you know, the the support system for founders here.
Zenos Schmickrath 39:15
I think right now, that support system is still very immature, I think almost anything that we can do to help that ecosystem and to help other founders to grow and to also be a support brothers, and encourage them to be a support brothers in Southeast Asia is really critical, because it is it’s often something that we discount as not that important as founders were like, Hey, no one understands my problems. I just got to get my business done. Like, I can’t really talk to anybody about it, but I’ll just figure it out. And you you kind of and in some cases, this is very useful as a founder, because you have this irrational belief that the company that you’re going to build is going to be successful against all the odds that might be against them. And so you tend not to rely And other people or to get, you know, you kind of discount the judgement a little bit. But it is really, really useful to have people that have been there done that, to talk to and to work through some of these difficult problems, because it really does inform you and into making better decisions. So I hope that, that new founders in Southeast Asia start to realise that having this kind of support network around them can be incredibly useful. And that they also then give back to that as they find success in their companies.
Ricky Willianto 40:33
Yeah, for founders who are looking for support, you know, whether the early stage or like series eight onwards, where would you recommend them to go to find these resources to find these communities in Asia?
Zenos Schmickrath 40:47
If you reach out to any founder, that, you know, almost everybody will give you the time of day and, and give us some help. I think one thing that I myself and a lot of other founders are bad about doing is actually reaching out and talking with other people. Because if you ask for it, typically, you know, other founders will be very generous with their time. And I’ve noticed this too, both with current founders, and then the retired founders that that if you reach out and ask and say, Hey, I’m doing this thing, and do you have 30 minutes or an hour to help me think through it? I have yet to see someone that’s like, yeah, no way. I don’t have time. So So I think it’s, it’s there. It’s just not so prevalent. And it takes a lot of initiative on the on a founders side to get it done. And to realise that they can accelerate their startup faster if if they reach out and get some of their network engaged in helping them succeed.
Ricky Willianto 41:45
Sounds good. So you know, before we end, every single one of our podcasts episode, we usually go through a quick fire round. It’s a really short questions. So are you ready for it?
Zenos Schmickrath 41:55
No. But yes, let’s do okay.
Ricky Willianto 41:57
So first question is, what is the one metric that you should care most about as a founder in your earliest age? And for founders in the latest stage of the business? Really good question.
Zenos Schmickrath 42:08
Let’s start with later stage. It’s, it will always be profitability these days. So think about Yeah, even if you’re not going to get there soon, you need to know your path to profitability in the early stage, I would say the absolute requirement is customer delight. Like, how do you serve a customer and the best?
Ricky Willianto 42:31
Sounds good. Next is what’s your favourite software to help you or your company grow?
Zenos Schmickrath 42:39
There’s quite a few out there. One of the ones I enjoy recently is Miro, in my art. Oh, that’s a collaborative whiteboard. It’s been incredibly helpful. Project Management Software. There’s lots of them. I like ClickUp. But you can use tonnes of them out there. And the one that I think almost all startups use is just Google Drive, and the whole whole G Suite. Yep.
Ricky Willianto 43:01
Sounds good. What is your favourite growth strategy that you’ve used to grow your startups?
Zenos Schmickrath 43:10
At the very beginning, it is to get honest feedback from your customers. Getting honest customer reviews and feedback at the very beginning will completely change the way that you think about the product that you’re building. That’s great. And also very true.
Ricky Willianto 43:25
What’s your favourite go to resources for growth? This can be a book newsletter,
Unknown Speaker 43:29
Ricky Willianto 43:29
Zenos Schmickrath 43:31
So I like Y Combinator, particularly the Startup School series, it has always been helpful to me, like I always find nuggets of truth and wisdom in that. Okay.
Ricky Willianto 43:42
And who has some of your growth role models, ideally in Asia?
Zenos Schmickrath 43:47
I’d say right now it is the founders Chairwoman, which is Anna Gong. And she she has just taken Perx and is growing like crazy. And every time I see your and look at what she’s doing, I am really astounded.
Ricky Willianto 44:01
That’s amazing. And finally, what is the best way for people to reach out to you and what kind of people do you want reaching out to you
Zenos Schmickrath 44:08
best way to reach out to me either on lol tiktoks great. What is your Hello zenosjake. But you can also reach out to me on LinkedIn. And it’s probably a good place. However I I’m not the best at replying to LinkedIn. So you can also get my email if you want to reach out to me directly, which is a first and last email@example.com obviously just picked up
Ricky Willianto 44:36
a comment on a lot of these tik tok videos. And yeah, get his attention there. Sounds good. Hey, so thanks so much for the time z. It’s been a nice chat with you. And I’m sure to learn more and hear more from you. Thank you so much for listening to this podcast. Check out other episodes to hear more growth stories and hacks from experts who have been there and that you can find our show. on iTunes, Spotify or via our website www.theravenry.com/growthmultiplier.
See you next time
About Growth Multiplier
The pursuit of growth is never-ending for any business – from a small startup all the way to a large global corporation. The Growth Multiplier podcast examines pathways, strategies, and hacks companies have explored and tested in their efforts to scale up their businesses.
In each episode, host Ricky Willianto – co-founder of Ravenry – speaks with CEO’s, growth hackers, product managers, and marketers all around Asia to find nuggets of wisdom and insights from their journey multiplying growth.
Ricky and his guests discuss viral marketing, community building, pricing strategies, channel development, and also company culture and people. Growth Multiplier explores not only replicable successes, but also phenomenal failures that we all can learn from.
Growth Multiplier is produced by the team behind Ravenry.