#52: $540M Founder Shares His Repeatable Software Playbook
Aug 14, 2024
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Stan Garber, co-founder of ScoutRFP and Levelpath, shares his journey from creating a restaurant tech platform to selling ScoutRFP for $540M. He emphasizes the importance of long-term partnerships, especially with co-founder Alex, and explores strategies for scaling software companies. Listeners will learn about maximizing client relationships for growth and the need for centralized systems in procurement. Stan also discusses trust-building in business and the significance of product-market fit for budding entrepreneurs.
Stan Garber emphasizes the significance of user-focused product development, which follows thorough understanding of customer pain points to drive innovation.
The podcast highlights the role of strong long-term partnerships, exemplified by Garber’s collaboration with co-founder Alex, in entrepreneurial success.
Deep dives
Journey of Entrepreneurship
The guest shares his entrepreneurial journey, starting from his high school friendship with co-founder Alex Yakubovich, which laid the groundwork for their business ventures together. After launching three companies while still in school, they shifted focus to an online ordering platform for restaurants called Onesis. Despite only raising half a million dollars, by 2012 they were generating over half a billion in sales, providing online ordering solutions to major restaurant chains without being widely recognized. Their emphasis on profitability from year two showcased a sustainable business model before it became prevalent in the SaaS industry.
Identifying Market Pain Points
The transition from Onesis to their next venture, Scout RFP, was driven by a shared frustration with the complex Request for Proposal (RFP) process. After recognizing common inefficiencies faced by procurement teams, they conducted extensive interviews with 300 industry practitioners to understand their pain points. This approach highlighted that many existing procurement solutions were underutilized and that there was a significant opportunity to improve the RFP process. Their focus on understanding user needs allowed them to develop a product that addressed real issues in a previously overlooked market.
Scaling for Success
The guest discusses the importance of growth metrics and the gradual scaling of their companies, noting a shift from initial small contracts to much larger deals as product-market fit improved. With Scout RFP, they moved from average sales prices of $6,000 to $150,000, reflecting the value they brought to customers as their product matured. The acquisition by Workday provided an opportunity to further scale, leveraging Workday's extensive customer base to enhance distribution. This experience underscored the necessity of having referenceable customers and drives home the point that scaling requires both grit and strategy.
Embracing New Opportunities
Following their acquisition, the founders identified yet another market gap in procurement, leading them to their current venture, LevelPath. They recognized that supplier information was often fragmented across companies, making it challenging for employees to easily access purchasing data. By unifying supplier profiles, they aim to create a more seamless procurement experience and position themselves as a key player in the evolving landscape driven by artificial intelligence. The founders' dedication to addressing identifiable pain points, backed by their previous successes, positions them well in a competitive market.
In this episode of Our Future Podcast, hosts Simran Sandhu and Michael Sikands interview special guest Stan Garber, the co-founder of ScoutRFP (Acquired by Workday) and Levelpath. Stan shares insights into his entrepreneurial journey, highlighting his past successes like selling ScoutRFP for $540M and building a stealthy but huge restaurant tech business, as well as his current AI + procurement venture, LevelPath. Stan emphasizes the importance of long-term partnerships in business, referencing his enduring collaboration with his high school friend and co-founder, Alex. Join the conversation to learn from Stan's experiences and gain valuable advice for aspiring young entrepreneurs.
01:23 Early ventures.
04:54] Scaling a Successful SaaS Company.
08:15] Painless RFPs.
10:15] Evolution of business scalability.
15:06] Building a sustainable company.
19:29] Scaling a successful business.
21:40] Maximizing existing customer value.
25:29] Fragmented supplier record data.
27:36] Delightful procurement vision.
31:12] Building expertise in different industries.