Designing a Product Your Customer Can’t Live Without | Brex's CEO and Mutiny's CEO

Awesome.

Well, I was actually at a dinner that Loom was hosting last night, and people were like, you and Enrique Mutiny, Brax, that's such an unlikely pairing, but we actually go way back. So Mutiny's first office was Braxton.

Yeah. So we, I think, were your first customer.

You were definitely one of our first customers.

Yeah, yeah, we were one of your first. You were one of our first customers as well. So the relationship goes a long time.

Yeah. And so we were in the Brex office and they had just raised this huge round and had gotten this really big office, and me and my co founder, we were going through yc. So we were sitting in the back of the office and every day they would hire 10 more people. And the line just kept getting closer and closer to us. And we're like, please just don't make us switch offices while we're in yc. But your growth has continued. What funding round are you at now?

We are Series D now. How about you guys?

So we just did our. We just announced our Series A with Sequoia.

Oh, that's amazing. Congratulations. Thank you. Thank you.

Awesome. Well, I know the name of this session changed a couple of times, so I'll start by sharing what we're going to talk about. And hopefully that's interesting to everybody here. Our focus for today is going to be. And let's see where the slides. Perfect. It's going to be how to design a product that your customers love by thinking differently. So as Enrique and I were and our teams were talking about this session, we realized that a lot of conventional wisdom is great, but a lot of the things that had made Brax and Mutiny successful stemmed from decisions that we made very differently than what other people had done. And, you know, that's really where the edge for a disruptive company comes from. And we thought there's not a lot of content on how to lean into your own intuition and diversity. And so what we wanted to do was go through a relatively basic framework of market, product, team, and failures, which are four big themes for every founder and every product manager that's going through that zone zero to one journey and share our anecdotes and stories and decisions that we made differently that ended up being really valuable for us. So let's start with market. Okay, well, Enrique, do you want to. Do you want to kick us off? What were some of the things you guys did at Brax to understand your market that was unique to your approach?

Yeah, for sure. So I think when we. Brexit actually came out of a Pivot. So Pedro, my co founder and I, we got into Y Combinator actually over this virtual reality idea. We had done a fintech startup in Brazil. We had sold it, and we're like, we're done with fintech. We're never gonna do fintech again. All these banks are so complicated. Like, we want to do something the bleeding edge of technology. We just got Silicon Valley, like Bill Gates and Steve Jobs and all these, like, amazing people did. So. So we're gonna do virtual reality. That seems like super at the bleeding edge of technology in 2017. And we had this idea and thank God we got into Y Combinator. But three weeks into yc, we were like, okay, I don't really know what we're doing here. Maybe we should pivot. And we started thinking about ideas and we're like, okay, which market should we go into? And we're like, well, we kind of know a lot about fintech because we've done that startup before. And, you know, one of the advice I got that I thought was super helpful is not only thinking about the product market fit, but what's the founder market fit. Like, why you as a founder are uniquely positioned to do, you know, this startup, right? And we, you know, we were, we were young and we were thinking, okay, like, why are we uniquely positioned? Well, we've done fintech before and we're from Brazil, so maybe that's, you know, maybe that's the edge. So we're, okay, let's go back to fintech. And, you know, and then we eventually landed in corporate cards. And then, you know, but when we started validating the idea, it was, it was kind of, you know, it was not super intuitive how to think about it, because we found a set, a small set of customers that said, like, I would really love this, like, I really need this. Which were startups. When we talked to more traditional businesses, they were like, oh, amex already kind of works. I don't know. But startups are like, yeah, I don't know, I really need this. Like, this would be much better. Like, this really, really is bad today. So we decided to start with credit card for startups. But it wasn't super clear back then that, you know, for us it was super clear. Like, we thought we could expand from startups to something else. But every time we went to talk to investors, they were like, look, Enrique and Pedro, you guys seem great, but, you know, I don't know about the tam of this thing. And I don't know, like, startups, like, are there enough startups to build a big business. You know, I can see why startups would choose you. I can't see why other companies would choose you yet. And you know, honestly we kind of didn't know yet. We just thought we were going to be able to expand to other markets after. We'll figure something out. But right now startups just seem like enough and we did. So we decided to be Brex. How most people knew us at the time is, you know, the corporate card for startups. And it came from really solving problems, you know, problems of even like a small population. But then after you have size and scale and you know you can build so much more, you have so much more capacity to build. Right? Because I think one of the early constraints of product market fit is you can't build things that are too complex because you don't have a lot of resources. So you need to go for things that are like kind of simple, you know, because you only have a couple engineers and you know, you, maybe you and your co founder, but then after you already grew and you have the expanding is much easier because now you can build more complex things because you have a lot more resources, you know, have more teams, you have existing customers. The opportunities for expansion go a lot further than we thought. And you know, I think since then there's other products and companies that position themselves to startups. But I like to think that, you know, we were probably one of the first to, to do it in a pretty scalable way. So that was a little bit of some anecdotes around us thinking about our market. How about you, Jolly? Tell me about how is vermutiny.

Yeah, and I was going to say I feel like I would have loved to see your first pitch deck where you had to make up the TAM at yc, whatever they would advise you to come up with, do the math. And then at the end it was like, no, no, it needs to be billions though. So do the math again.

We were very generous with our math like that.

Yeah. So a little bit of context about Mutiny. So my co founder and I both worked at Gusto. I led marketing and he was leading one of our engineering teams. And basically at Gusto, through a lot of manual work, a lot of growth engineering, data science, we had figured out how to help convert our top of funnel traffic, so advertising, content marketing, SEO into actual revenue and upsell and referral customers. And we were, we had built a lot of that experimentation framework bespoke. And so the catalyst for starting Mutiny was that we realized that what we had done was something that everybody would eventually need, but wouldn't necessarily have the engineering and the technical capabilities to go build that from scratch. And so we wanted to build a no code platform that any company without, you know, being super technical could use to convert and personalize for their different audiences. And so we had this really big vision. And the convention wisdom I think at the time was, and I'm sure you guys have all heard this, which is startups are inherently very chaotic and you should expect wild iteration and there should be mess all over the walls, otherwise you're not doing your job. And I think while that's true, there is a lot of iteration because we had a clear sense of what we were going to build. We wanted to also create structure and stability within which we could do our iteration. So one of the best things that we did early on was we took a step back and said, for our vision to be true, what are the hypotheses that need to come true? So what are sort of smaller statements that need to be true? And we ended up creating five hypotheses, each one with a metric that if all of those we were right about and we could make them happen, then we could, you know, Mutiny would be this huge success. So, for example, the first hypothesis was around data because, you know, we were building this personalization and conversion engine. And so the first hypothesis was that we had to be able to identify over 50% of the buyers and customers within any channel that we operated in. So if we were helping personalize websites, we had to figure out how to get to above 50% actionable coverage of the visitors that were coming to that website. And if we had that, then we would be able to, you know, apply the subsequent steps. And so, you know, that framework ended up paying off a lot of dividends for us in the early days, because even though we made a lot of changes and we would move really fast between what areas of the business we were investing in, the early team was able to operate in this really holistic way, understand exactly why we were making the changes that we were. And it also helped us a lot in recruiting where people wanted to kind of, you know, the big vision, sometimes it's. It's a little too big, and they don't necessarily understand all the pieces that goes into that. But once we broke it down into the hypothesis and metrics and could explain what were the projects and the roadmap associated with each of those, it made it a lot more tangible for everybody to kind of wrap their head around. So moving on To I keep looking behind me. I'm just trained on stages that are right behind you. So moving on to product, I think this is a big topic for a lot of product managers and founders, right? How do you iterate? Do you listen to your customers? Do you not listen to your customers? What were some of the things that Brexit differently, Enrique, to help iterate your product?

So I think that the way that we, you know, Brex has an interesting property, which is everyone needs a version of what we're doing, right? So if you're starting a business, you will need a corporate credit card from someone. Might not be from Brex, hopefully it is, but you'll need a corporate card from someone. So the thing that we always thought about is, like, look, how can we be better than the ones that exist, right? Like, how can we build a better value proposition that's like, very obvious and obviously better than the one that already exists? And that's a little bit of a different challenge than other companies which have different advanced pros and cons, but that are trying to sell a product that you don't yet know that you need, or you maybe don't know that you need, and you have to convince the company to adopt this new thing. So for us, it was a little bit of a different game. We, like, kind of like, okay, everyone needs this. We just need to be better than the other guy. And we're like, asking founders and like, hey, if we built a car that gave you a higher limit with no personal guarantee of amazing rewards and super easy to use kind of like technology that seems like every other product you use and not like, bangs, would you use it? A lot of people said yes. I would say. Not everyone said yes. I would say, like, a good amount of people said yes. But then our thing is like, okay, can we actually do that? We didn't know yet if it was possible doing it. Like, in financial services, there's a lot of complications and restrictions and regulatory and financial implications. Like, it's, It's. It's pretty hard to build. But we knew that if we got to the promised land of offering these four things to customers that at least, you know, in the segment that we were looking for, they would sign up. So we kind of like worked backwards from there of like, hey, what would the kind of the value proposition that most people would say yes to? How do we make that economically viable and how do we make that good? I think that's how we started. I think we were lucky that we were also startups and we were serving startups because that just kind of gave us a very good intuition around what the product, you know, the customers wanted and being super transparent as we try to expand outside of startups, you know, we recently have become successful at it, but we struggled for a while because we're like, okay, like we don't know the customer as well as we knew this one before. And we had some, we had trouble like empathizing and we built some wrong stuff and, you know, we iterated. And I think, you know, I probably was not talking enough to customers when we tried to expand outside of startups. But then we kind of got back to, you know, the YC advice of just, you know, talk a lot to your customers, and we kind of got back to it. So I think a lot of times, you know, founders have the early customer you have really good intuition around because that's kind of where you came your idea and you started working. But then when, if you had to expand to larger customers or different segments or whatever the expansion is, you know, it's a little bit harder to do that. So you need to kind of go back to, you know, just talking and listening a lot to customers as well. And I think the other point is that we, we also made a mistake here. You know, sometimes is like, is sometimes talking to customers wanting to validate something that's already in your head because, you know, it's doable. And I think, you know, it's. The ways we were more successful at it is when we were talking to customers without knowing what we were going to build, like when we were pivoting or, you know, when we're. Without having any expectations and then listening really deeply and then figuring out what to do. So. But I'm curious for you, you know, you guys have also iterated and built the product over a few years now. I'm curious, what were the learnings, like mistakes and things that you guys got right around this?

Yeah. So early on we set this value that we were going to make a decision around who our ideal customer profile was going to be. And we knew that there'd be some people out of that that we would eventually remove. But once we qualified somebody and they purchased Mutiny, everything that they did wrong, so every failure was our fault. And ultimately, you know, even though, you know, we started selling to customers after three weeks of building the product. Right. So there was a lot of stuff that wasn't yet built into the product, but we ultimately took it as our responsibility to help them be successful. And so we were really, really hands on with customers. And we would do things like, for instance, we would say we want you to implement this beta feature and we would agree to a timeline and they would go and implement. And if they came back and said, oh, I was planning on giving this back to you on Wednesday, but instead it's going to be next Monday, we would get really curious, like, why did it take you so long? What went wrong? What was harder than you thought? Because we wanted to understand what. What are all of the paper cuts that are happening behind the scene outside of our product, and can we chip away at all of those bottlenecks for the customer eventually with the product? And so one instance for us was that people would come into Mutiny having a sense of, okay, these are 20 different segments that I want to personalize for and increase conversion for. But then they would get stuck and not know, okay, which one do I do first and second and third. And it would take each one, you know, would take them a little bit of effort to launch. And so what we started doing was pulling the data for them manually, right? Not worrying that we were doing the work manually and that it wasn't gonna scale. We would just say, let's help solve this problem for you manually first, and then we'll worry about whether we can automate it. So started pulling data for custom early customers. Pulled a lot of data for. For Brax, because, you guys, we didn't even have. We had. We didn't have a user interface when you started using Mutiny. And then we would put that into Google sheets. We would prioritize the data, ask the customer a lot of questions about, is this the right information? What else would you want to see? What's here that you don't need, that doesn't help you. That's just clutter. And eventually, once we figured out the exact information that they needed with that prioritization decision, we built this really nice data visualization flow inside of our app where as they would select segments, they would see exactly the info that they needed, comparison of that segment to other segments that let them make decisions really quickly inside of the app and essentially turn what was taking them, you know, sometimes up to two weeks and actually for some customers, resulting in them not even moving forward to now a few seconds within the Mutiny app.

That's awesome.

Yeah. Okay, team, this one. I feel like you're going to be amazing at this. Enrique is the best recruiter I've ever met. He just always, for every role, you know who the best people are in the valley and. And you somehow find Your way to them. What are you doing differently to help recruit talent?

So first, I am not the world's best recruiter because I had a big failure because before Jolly started Mutiny, I tried to convince her to join Brex, but her mind was set in starting a company which now has been very successful. So I had a big failure early on, but happy, happy the way things turn out. So I think we were like, really aggressive with recruiting, I would say, in the sense of we made a lot of decisions around, like, how can we get the best talent. I think, you know, I think a lot of founders, they started like, hey, this is the way I want the company to build. This is exactly what I believe in. This is, you know, a bunch of like, things that are fixed and then, you know, they try to recruit and there's like some differences and, you know, people stick to it. And I think there's like, there's a, there's a, there's a bullish case for that. There's a little bit of a. Not a bullish case for that. I think for us especially early on, we're like, look, there's so many smart people in the valley, especially, like executives. We want our culture to be helped being shaped by them. Like, so we hired our, I would say our cfo, for example, in their general counsel early on. And we actually wanted them to help build our culture. And we wanted the company, not just me about what Pedro and I wanted, but them having also a say on how we're building things around. And I think that was super positive. I think we came out a much stronger culture than if we had not done that. And I think that we just found a way. So like, you know, again, we gave a lot of equity for early hires, plus we were generous of cash, plus, you know, we gave titles. Like we, you know, all these things. Like people give you the advice of like, hey, constrained and restricted. And we're like, I get it why that would be true in the ideal world, but all in together. I just want the best people, you know, like, because that can make such a massive difference. Like, I came from Brazil and, you know, we built a company there. There wasn't like really good executives in Brazil at the time because there wasn't like a startup ecosystem, right, that people had gone through these growth stage companies and we just had to do everything and learn everything ourselves. And then we got here and we had, you know, for example, our cfo and like, we just didn't have to worry about finance. Everything was like, done. And it's perfect. It was like much better than we would do. And we're like, oh my God, this is amazing. Like, how much time can this save me to go like, do other things, you know, and like make us world class and this thing that's super important for us to be a world. So we're super grateful for our early hires and early executives that joined Brex. And you know, till this day we have this culture of like, let's get the best people in the world, like how do we do that? Like let's, you know, let's change and let's adapt so we can keep attracting the best people in the world. And then the other thing I'd say is historically, especially for early stage companies, hiring people who have been through other startups before helps a lot of, you know, I think people who've been in big companies, there's a lot of very smart people, but the life of a startup is just like so much different that a lot of the experience is like not super relevant. So it's almost like starting from scratch again. So if you can get someone that has gone through like startups before, you know, especially growth stage startups, that is like really a big indicator of the person is going to work or not work. And at least that has been like our experience, especially in the executive level. Now that we're bigger, we need people who've seen bigger companies. But early on that was probably one of our main heuristics is like, hey, if you've been the number two at a successful startup that I kind of grew and you saw that whole growth and maybe I want to be the number one somewhere else, that's a really good profile. So that's what we learned. But how about you?

I think also the reason people give that advice of don't give out a lot of cash and titles is because people are worried about retention of are they going to stay or are they joining you for the wrong reasons? But you've had really great retention especially for a lot of those, you know, early critical hires.

Yeah, I, I don't really buy, you know, just, I don't really buy the argument of like people joining for, for, for, for a lot of wrong reasons. I think like, especially in the early stages, if you're, you know, if the company has a chance of not working and you're devoting your life to this thing, like that's the right reason. You know, like it's, you have so many opportunities, if you're good, you have so many opportunities and you're choosing to join these early stage startup by two random Brazilian dudes, you know, that's like the. There couldn't be a better reason than that. So. And if you need a little bit more cash because you have like a high mortgage or something, or you know, you want to get a lot of equity because, you know, you really want to get a lot of equity, like, I don't know, I feel that just when you're bigger, it's different because then people would have different reasons. But when you're early, there's so much risk involved that I don't really see a lot of really good people joining for wrong reasons.

Yeah, that's really good advice, I think, especially in this recruiting market.

Exactly. Yeah.

So on our end, the thing that we did differently early on was for a few really critical roles that were very unique to Mutiny. We built the function based on our needs and not what was considered world class for that function. And this was very different than the best practices that I had learned when I was at Gusto. If we were hiring for a new role, the first thing that we would do is if we were hiring a product manager, go talk to five of the best product managers, learn the interview process, and then figure out how to find somebody like that. But for us, for example, our customer success function was very unique in that we needed to be both analytical but also creative. And this was really evident from the early days of even when I was helping customers one on one. And so when I was building out the function and hiring our first person, I didn't talk to anybody from customer success departments. I just wrote out the things that were really important and I started filtering for those things on LinkedIn. So our first hire, Molly, she was a math major who was doing personalization and was a consultant. So she had the customer experience, but she was also in writing competitions and she just was a beautiful writer. And it was very clear that she has kind of the, you know, left brain, right brain combo. And then she did such a great job, she now leads that department. And her first hire was a film major who became, you know, a. Who moved into marketing analytics. And it set this very unique DNA of people that are good with customers but have this very unique mix of art and science that's very important for us. And now I would say, like, when I talk to other companies within our space, they're always trying to figure out like, wow, how did you guys build your CS department? And it's like, well, we didn't really build a traditional CS department. I do think following Conventional wisdom on a lot of the roles where you don't need to be different is good. Like, you can very quickly get yourself to best practices and make fewer hiring mistakes. But definitely listen to your instincts if there are areas that you think you need to operate very differently than how other companies are doing it. And maybe we'll move on to failures. This is a favorite topic for going from 0 to 1. Any failures for you, Enrique, that helped you think differently about how you were building the business?

I think that, you know, one. Thing that happened to us, and I kind of alluded this for a little bit, is when there was this some point in Brex in which, like, we, you know, we became really obsessed with, like, strategy. And, you know, we just. We were reading all these strategy books and, like, we got, like, super obsessed about building the best strategy, and we started building all these things would be, like, strategically amazing for us, but we just kind of, like, forgot to talk if the customers wanted it. And I think that was, like, a pretty big failure in process, in my view of, like, how do you combine kind of doing things that are good for the company and strategic for you to do? And, you know, and I really love this. Then I was getting advice from our advisors and like, yeah, man, there's this concept called strategy tax. It's like, what's a strategy tax? The strategy tax is when you do something that's good, would be amazing for the company, but you just forget to see if your customers actually want it. I think we probably had one or two of those that I think were really good lessons, because now we're like, the process of building products. We're just so obsessed of just building things we know and we're pretty sure customers will want instead of things that will be strategic for us to have. I think that's my anecdote there. How about you?

So in the early days, we set revenue as a goal. So three weeks into writing our first line of code, we had revenue goals. And we set those goals by looking at companies in our space that were. Or like in analytics, for example, that were a few years ahead of us and looking back at what was their revenue trajectory. And we set those goals. And part of the reason we did that was I remember when we were going through yc, one of the partners, the guy from Initialize, he gave a talk that really resonated with me, which is, when you're starting something, you really want it to work, and you're not always going to see reality as it is because you just so desperately want to be right about the quality of what you're building. And so you should always be clear about what are the most important metrics and whatever metric or graph you don't want to show to your board and is what you should be showing to everybody, because that's the thing that you need to fix immediately. And so we decided to set revenue goals very early on because for us, revenue, everything ultimately showed up in revenue, and it made it very difficult to hide from problems, right? We could see low conversion, we could see churn, we could see lack of upsell. All of that would ultimately show up in the revenue goals. And so that worked really well for us, especially since our market moves really, really quickly. But thank you so much. I know a lot of you had a big night last night, so thank you for coming to this early morning session. You know, I think this is a really exciting time in the Valley where we talk a lot about diversity. And I can't imagine anything, you know, more than where diversity matters more than it does in, in startups, because it's really about leaning into what makes you different, what makes you choose different paths, and ultimately that should lead to building a really awesome, disruptive company. So thanks for coming.

Thank you so much, everyone.