E46: $5M to $55M: Craig Harris’ ScaleUp Journey at Deputy

number one, I'd probably start with getting clear around what's going to complement you as a founder. Like, what kind of skills do you feel like you're lacking, if you're really honest, and, and where, you know, you're least developed? And being really self-aware and understanding that. And then, so once you're clear around, well, what are the types of competencies you're looking for, then from that you've got a degree of clarity around what are the types of roles that make sense. Like, what are the first roles you should hire to complement you, right? So that You know, you've got the opportunity to support whatever it is your growth strategy entails. And so part 2 of what I'd say would be learning to let go of those things where, you know, as much as you got the deepest expertise on the business as a founder, but where you don't have that key competency, being able to let go and establishing kind of, I guess, clarity around, okay, what's the expectation? What's got to be delivered by those key folks you're bringing in, agreeing on those outcomes. And then letting them go do it, assuming that they've got the proof points in their track record and they've done it before, allowing them to do it in the way that they see fit is often hard for a founder to let go. And so all they can do is measure on the basis of are they achieving outcomes that have been agreed, right? So number 3, I think it's building an organization where these sorts of folks can thrive. Like, so if you're gonna bring in someone who's, you know, more experienced exec or a senior leader, Ensuring that they've got a remit that allows them to thrive and so that they can, you know, not only complement you as the founder, but they can actually have one of the greatest experiences in their career in working in your organization.

Craig, thank you so much for joining me on the conversation today.

Hey, you're very welcome, Fred. It's always good to have a chat with you, my friend.

Thank you. So for those who don't know Craig, Craig has been the COO at Deputy, the Aussie unicorn that scaled from $5 to $55 million during his time just in 4 years. He has also been the COO at Lumary and more recently the CEO at Plexus, all amazing startup companies, and he has got some great stories for us. So Craig, before we jump into the specific story, tell me what attracted you into this crazy high-octane world of SaaS startups.

Yeah, well, it's, it's been a long time in the making, Priya. I've been doing it for just short of 25 years, been in leadership roles across different technology businesses. And you could say I've become a bit of an addict. A lot of people talk about VUCA, high VUCA, so volatility, uncertainty, complexity, and ambiguity. And I've become somewhat addicted to that because I find if I end up anywhere that doesn't have that, I get a bit bored. And so, but really what it's about is building. I love helping founders and companies build. And usually where I come in is at the scale-up phase, like when a business has kind of established product-market fit and looking to to accelerate that level of growth. And it's an exciting and very rewarding one.

So, Craig, tell me more about the journey that you had with Deputy. $5 million to $55 million in 4 years is amazing. What were some of the foundations that you put in place to make something like that happen?

Yeah, look, I should probably start giving you a little bit of context. I mean, the business had already established a pretty good product offering and had been proven somewhat, you know, to get into $5 million, which is pretty impressive. And really what they were looking for is to accelerate growth at it on an international level and to find a way to build what I call sustainable growth. It had been very sort of, I guess, inconsistent the way the business had grown. And so they asked me to come in and help. So Ashik and Steve, the 2 founders, and I followed what I call the 3 A's of accelerated growth. And so it starts with assessment followed by architecting and followed by accelerating, right? So really the first couple of months was all about assessing exactly where the businesses are at, what were the growth limiters, what was the issues both in terms of the buying journey, like what did the business have in terms of its level of capability around people, its processes, really understanding like what it would really take to grow at the level that they looked to move to, which was kind of more 100% year-on-year growth, pretty aggressive level growth. So I found all sorts of opportunities, great team of people, really young folks who were very keen, very committed. But, you know, there were some gaps, right? So from there, architecting the solution as I call it, very much centered around the product, getting the product experience, particularly the buying experience. And we'll kind of COVID a little bit on that later if you like, getting the go-to-market model to really match that level of product experience, having an org structure and makeup that actually was going to, you know, to result and the level of growth being desired. And then finally, an execution rhythm. I call it operating rhythm of the business, coming up with an approach to ensure that the business could execute in a way to realize the goals that it set. And the acceleration phase of the establishment of foundations was very much hiring the right people, building out the team globally, getting them really enabled effectively through systems, having that kind of operating rhythm through OKRs and other means of getting getting the business focused and really disciplined around how it could execute in achieving that growth and getting everyone bought in and, you know, on board. That was my job to complement Ashik, who was the founder and the architect of the product, doing everything I could to complement him and to get him to be successful.

Yeah. Wow. That's amazing. So you've given us a really nice framework around assess, architect, and accelerate. Let's jump right into the assess phase. And that I, you know, I can see how valuable that would be because, you know, anything that is led by consultation is going to be far better informed. Because I also know of situations where people bring a playbook that worked somewhere else, and then they try and inject that playbook, the team rejects that. And it's just, you know, it's not a good situation. So what would be some core principles that we can take away from your journey from the assess phase?

Yeah, I think like, you know, really go deep and understand, you know, I mentioned before, what are the growth limiters, getting to kind of root cause on that and following a pretty thorough process and doing that with the key stakeholders in the business, not doing it independent, working with the team to really get to that level of understanding to identify what are the greatest opportunities for growth, what are the greatest limiters. And so the journey I went in with the deputy team was very much I guess, understand where in the buying journey in particular there was drop-off and where they were losing potential customers. And then when it came to the actual team and how they operated, getting really clear from their perspective, you know, where they were not able to succeed and where they weren't able to deliver for the business and where it, you know, where it wanted to go. And then really testing almost sort of prototyping systems to get them operational and I guess working in what is this high VUCA environment I mentioned earlier. trying to do everything possible to limit the impact of that high-vircus situation so they could operate, you know, at breakneck speed.

Yeah, that sounds fantastic. And I think that simple filters around what you've just discovered, you know, you've talked about around constraints and what are the limiting factors and identifying those early would be so critical to gain that awareness that you drive into the next phase and start architecting. So let's talk about a few things, you know, some of the core areas. Tell me more about product design and then we'll talk about go-to-market because I would assume there would be critical elements there.

Deputy had this amazing product that already, and this is, don't forget, this is back in 2016, 2017 when, you know, product-led growth as a go-to-market model was quite early, you know, in its infancy. And so Ashik had built this solution that actually did allow someone to self-purchase, you know, and self-onboard. It's just that, you know, there'd been not a lot of investment and focus in really iterating and improving upon that to get to a level of conversion from somebody who's coming, you know, onto the website right through to becoming a paid customer. And having that as a focus in the business was what was ultimately missing. Like it was just an assumption that, oh, we've built it, people should be able to come in and work it out for themselves. And so you had that product side and, you know, thinking about what it takes to actually get to value as a prospective customer, understanding, you know, what it really takes to have themselves on board, how do you need to incentivize them to get there. So the product experience is, you know, again, I could talk to all the experimentation that happened on that side of the fence, but then in partnership with our go-to-market organizations, we built an inside sales team to truly complement that. So, So that every single experience that those prospective customers were having, we could complement that through the sales process. We could, you know, reach out to them, we could send them materials to help support where they're at in their journey. And so every, like every month, month on month for many, many years, we were iterating, improving upon that. So we went from a conversion rate of, I think it was about 6% when I started of those folks who signed up for a trial through to closing and becoming a paid customer, we went from 6% to, I think we ended up at around 15%. Now that took, you know, probably a couple of years, but it was relentless focus and discipline to get us there.

That's amazing. So, you know, part of that phase in terms of the architecture, what would be Let's say we parachuted you into a new startup environment, you've done the assess, what are the top 3 to 5 areas any startup founder who's listening to this, maybe at an earlier stage, or is thinking about architecting, what are 3 to 5 areas that you would be at the top of your list in terms of architecting or re-architecting?

Yeah, like, I think user experience, if you, what are you trying to achieve for that prospective customer? Ultimately, you know, SaaS models differ based on what they're, what's the problem you're trying to solve. So getting really deep and orientated to the pain that they're experiencing because that's what you're gonna ultimately be selling, like, is, you know, how are you gonna solve their pain? So architecting or designing the user experience so that it does that seamlessly is the number one by far and away. And that's both in terms of the day-to-day operation of the product, but probably just as importantly, demonstrating that through the buying journey, right? So if you're in a trial environment, you're getting to experience exactly how the product solves that pain point. By far and away, to me, that's the most important thing. The other themes I'd suggest are what are you doing to reduce the time to value as it's called? So demonstrating that capability and problem solving for them, doing that in the shortest amount of time possible because you see serious drop-off from the moment somebody lands into a trial environment. You'll see the biggest drop-off in the first, like, probably 24 hours following that. And so you've got to do enough to, I don't want to say wow them, but you've got to do enough to impress upon them that, hey, we've got a solution that actually is gonna solve your need. And so that time to value is another theme. But probably over and above that, my tip would be probably thinking about incentivizing those users to follow the steps that, you know, that they can see that value. So providing incentives through the buying experience, like to get them. So we did all sorts of experimentation around giving additional free days, free trial days if they went and fulfilled certain onboarding tasks that were critical for that value to be demonstrated.

Very nice. So if we had a startup founder that's listening to this and they're trying to figure out what's that stage to take go-to-market and product, 2 critical elements and go from Founder-led to, you know, they might have a CTO which is a co-founder, that's a different situation. But what's the time to start bringing experts like yourself into the process?

Yeah, I think like usually it's, you know, what's the definition of product market fit? You know, how to really demonstrate that that's occurred and that's through a combination of, you know, you're seeing a consistent buying approach from potential customers. You're seeing evidence through obviously consistent results. thoughts around sales and your ability to convert them and it not requiring the founder to do an amazing show to convince because usually founders are selling with vision, like a very visionary approach to how they position the company and what it's gonna go and do. But really trying to get to a place where, hey, is the product able to sell itself with someone who's a capable salesperson, not necessarily a superstar? So if you've got to that point, right, like then it makes sense. Hey, we bring in, you know, bring in the cavalry, bring in a sales team leadership because scaling, right, is all about getting super clear around who you're targeting. Like, so who is your, you know, what's the ICP look like? What is gonna be the go-to-market model that you think is absolutely optimal and relevant to that potential buying audience? And starting there, not trying to do everything, not trying to be everything to everyone and not trying to, attack different means. So every company I've joined, it's been get really focused around what's the optimal buying journey, what's the optimal go-to-market model to complement that and then, you know, execute until you get to a point where you've mastered that and then you can go and find other streams. So other go-to-market models or channels that can give you additional growth. So in the case of Deputy, we largely focused on that SMB to low-end mid-market. So that would go on that journey I mentioned. Over time, we kind of expanded, we went upmarket to mid-market and that's a totally different sales approach or different go-to-market model as you know. And so I think, you know, my advice to a founder is start where, you know, the product is proven, where it's adding tremendous value, where you got hopefully raving advocates as customers that you can leverage as both case studies and reference customers. And just start in a really simple fashion and build from there.

Yeah. Yeah. Moving to accelerate, I want to get some insights into that. So, you know, you've done your assessment, you've got your architecture in place in terms of how do you now start moving down the runway heading towards takeoff?

Yeah. I mean, I touched on it a little bit, probably I went ahead to accelerate when we spoke about that kind of ongoing optimization or iteration of the buying experience. So that was one element, went from architecting. So architecting in the case was a cross-functional team across product through to engineering, marketing, and sales, and having a group that would be just entirely focused on optimizing. And so obviously hiring the right people to go do that, we built a really good team to both lead and to actually execute on that approach. Then looking at the wider business. So, you know, yes, I mentioned before in the architecture stage, you're getting, I guess, pretty well thought out on what's the org structure need to look like. So in our case at Deputy, we moved to a decentralized model when we expanded into the US and UK. We knew we needed kind of pretty strong leadership locally in each of those markets because we were investing some serious money there. And we also needed to understand locally what were the differences and what we had to get right. both in terms of the product experience and the go-to-market model in each of those territories. And so getting that right and then going and hiring the right people to complement that is what I would consider to be, you know, the acceleration phase. I mentioned before, you know, getting into that operating rhythm, like, so establishing OKRs as a means of getting really, really disciplined and structured of how you execute and then how you stay focused on the right things because like these businesses, there's lots of opportunity you can go chasing, you know, all sorts of growth from, from numerous sources. And, and if I'm honest, we probably made some mistakes along the way. We, we probably did chase some, um, some deals we shouldn't have, right? And you learn, as long as you learn from the mistakes you make and then get far more focused and disciplined, um, then you, you know, what you find is you've, you've got the opportunity to grow at that sort of, you know, that, that high level like what we did, which was 100% year on year. Wow.

Well, you were talking about learning, and I think that the more I work with a whole range of startups, scale-up, you know, and some very large iconic SaaS companies, you know, everyone's got plenty of things that they've tried and they haven't worked out. But most importantly, you know, my takeaway is that failure is feedback and feedback is knowledge. And knowledge is power. So as long as you are taking the feedback, you're gonna get stronger and stronger and make fewer mistakes.

So. Totally. Well, I think, I think that's dead right, Priya. I mean, the other thing I'd say to complement that is like, if you're gonna try things like, you know, through an experimentation lens, do it in a way where you can be really clear around what you, you know, what are you trying to prove out and ensure that you can, you know, you can pivot away if needed because you do fail a lot, right? And so long as you're not betting the farm on any particular approach. You're proving yourself in what's happening across the business in all these pockets, but doing it in very, very considered bets, I guess I'd call it, like really controlled experimentation. So, you know, I mentioned the OKR lens, like actually having specific initiatives that have been undertaken, but ensuring that they're priced at an appropriate level of, you know, the investment's not too significant and feeling like you've got enough proof points to then go invest at a far larger level.

Nice. One more question. Tell me, in terms of if we have a founder listening, you know, early stage, what are 3 things that you'd give them in terms of advice on how to work with their leadership team that they're trying to now go from everything being founder-based to, you know, whether it's, you know, COO or head of sales? How does that What advice would you give a founder? Top 3 things. Yeah.

Okay. So I think, look, number one, I'd probably start with getting clear around what's gonna complement you as a founder. Like what kind of skills do you feel like you're lacking if you're really honest and where, you know, you're least developed and being really self-aware and understanding that. And then so once you're clear around, well, what are the types of competencies you're looking for, then Then from that, you've got a degree of clarity around what are the types of roles that make sense, like what are the first roles you should hire to complement you, right? So that, you know, you've got the opportunity to support whatever it is your growth strategy entails. Because usually a founder-led company, the founder's doing it all. They're, I guess, on the hook for figuring out. And usually founders who are successful are damn good at it, like they're really good at it. And so Part 2 of what I'd say would be learning to let go of those things where, you know, as much as you've got the deepest expertise on the business as a founder, but where you don't have that kind of key competency, being able to let go and establishing kind of, I guess, clarity around, okay, what's the expectation? What's got to be delivered by those key folks you're bringing in? Agreeing on those outcomes. and then letting them go do it, assuming that they've got, you know, the proof points in their track record and they've done it before, allowing them to do it in the way that they see fit is often hard for a founder to let go. And so all they can do is measure on the basis of are they achieving the outcomes that have been agreed, right? So that's number 2. Number 3, I think it's probably building an organization where these sorts of folks can thrive. Like, so if you're gonna bring in someone who's, you know, more experienced exec or a senior leader, ensuring that they've got a remit that allows them to thrive and so that they can, you know, not only complement you as the founder, but they can actually have one of the greatest experiences in their career in working in your organization. So thinking about that, you know, proactively is probably the third thing I'd say is just as important.

And now let's flip that question. What advice would you have to a leader who's looking at, you know, I'd love to work with an Aussie startup, you know, and work with the founder, really get experience in that early stage phase? What are 3 things you'd give them in terms of advice on, I guess, what, how to choose and how to make it work?

Yeah, I think it starts with, you know, if you are interviewing for a job with a, you know, a scale-up or a startup, being really clear around what, you know, what type of company you're looking for, what type of founder you think you can complement. So, you know, start there. Let's make sure that you're actually hunting in the right areas for an opportunity. And then once you're kind of in that phase of you're actually interviewing, you're meeting founders, really getting an understanding of, A, do you complement them in terms of your skill set? But just as importantly, B, do you feel like you gel with them, right? Because everyone's got a different style. And as much as you might have complementary skills, if there's not really a connection, like you've got to have a connection, like you're in the weeds working with these people day in, day out, it's pretty full on. And so you've got to feel like, oh, I really like and I could see myself enjoying working with this person. And so that complementary I guess, cultural and philosophical approach to growing businesses is probably the second part. The third part, I'd say that, you know, I'll flip what I said before around the founder. For the person coming in, it's important for them to get clear and get agreement around expectations of what's got to be delivered. Like, you don't want that to be, you know, gray. You want that to be uncertain. It's got to be clear. This is, you know, this is what we're doing. And so that those folks, you know, your founder and your executives are 100% aligned and understood exactly what needs to happen and what needs to be prioritized, you know, because often, you know, founders, they're very entrepreneurial, like amazing people, right? Like they can do things that I wouldn't even dream of being able to do. But, you know, they often have this creative spark and they've got opportunities springing up left, right and center that they can conjure up and that they can, you know, have the business follow. But the business can only do so many things at once. And so striking that balance between So, you know, really enabling that spark and really supporting it and harnessing it, not killing it off by saying, no, we're not doing that. Saying, okay, we can do that, but let's take stock here. Will this be better than what we're already doing? Like, let's be really clear around the trade-off. And that's what I've found in my career is that conversation, getting really clear around how you get to agreement with your founder around what you're doing and why is the key to success.

Right. Yeah, this is going to be so helpful, so helpful to people who are in both sides, you know, of that seat. Last question. We talked about VUCA, and we know that, you know, as you sailed into COVID, we all had a once in a Well, at least so far, a once-in-a-lifetime event. What— how did you navigate that? Because I know that, that, that, you know, was very, uh, impacting. So tell me a little bit more about that season.

Yeah, so, so, you know, we spoke before around the, the, the wonderful growth story, uh, that, that, uh, we, we got to experience at Deputy. And that might mean my first 3 years there, we did on average 100% year-on-year growth. It pretty crazy, but, you know, amazing and very rewarding. But then, yes, when COVID hit in early 2020, we were a business that was, you know, predominantly serving SMBs in the hospitality and retail sector, right? Which were very, very exposed and were deeply impacted by the pandemic. And so I should mention that those businesses were on month-to-month arrangement around their subscription. So they could cancel at any time. And so as a business, we built this, you know, very, very successful, lucrative. And, you know, by that stage we were pretty much north of $50 million in revenue. And so when suddenly COVID hits and you're really having to make some pretty tough decisions. And I guess, you know, when you talk about managing a crisis, I like to kind of use what I call the 3 C's of managing and surviving a crisis. And the 3 C's are confront, control, and commit. And for us, when we went through this at Deputy, confronting the facts, you know, which is pretty tough when you're facing the first time in all of our lifetimes a pandemic and what is it really going to mean. And confronting the facts and understanding, well, what really is likely to happen now based on what we knew was to kind of make decisions and not hesitate and having to say, well, based on what we know today, we're going to have to make some tough decisions for, you know, not only the survival of the company, but what's going to actually ensure long-term success beyond this period of crisis. And so confronting the facts, number one. Number 2, controlling was, in our case, controlling the cash burn because we were, you know, we're a business that that was built for growth. So we'd invest a lot of money to support that level of growth all over the world, as I mentioned. And so getting really clear around, okay, what do we need to get that burn rate down to? What are we gonna assume around our revenue drop that was quite substantial at the time, temporarily, thankfully? But doing enough to preserve that core capability of the business, doing enough to protect the customer relationships. So what do we do? We didn't say, yeah, go ahead and cancel and lose everything that they'd had set up in the environment. We actually came up with a whole scheme to allow them to pause their account with us so that as soon as the pandemic kind of ended or when the periods of trading were able to happen again, they were to simply unpause and resume business and we would only start charging them upon that occurring. So controlling all these elements of the business was kind of the second phase of this crisis management approach. And then finally, the commitment. And the commitment really was not only to follow through and make these tough decisions, we had to make just short of a third of the workforce redundant over that period, which is pretty tough, but doing enough to ensure the business understood why and understood that, hey, if we do this, we're still gonna have long-term success. So, and doing everything possible to ensure that we position ourselves to rebound when, you know, when that pandemic ended and having the team really understood and bought into that was kind critical for us to maintain that level of belief and commitment from our team. And so committing, you know, us committing to a recovery ultimately was the third component to surviving the crisis. And look, we're very lucky that, you know, by doing that, you know, yes, it was an awful year, you know, for many, many reasons that we all know, but we did rebound the following year and we pretty much got back to our revenue position. I'd say it would've been Early 2021 when things were starting to restore and businesses were coming back online. And so we kind of, you know, managed to recover what was a pretty critical phase. So as much as we like to think these businesses are up and to the right and we're absolutely flying and there's no issues, but when you have things like that happen, it's whatever you can do to manage not only the depth of how far things drop, but how quickly you can rebound and get back to your you know, your level of growth you were searching to achieve prior to.

Fantastic. Well, I think you've given, you know, another great framework today here around crisis because scaling and crisis, I think, go hand in hand regardless. You know, we just— COVID was the context, but really the confronting, controlling, and committing. I can just see these 2 frameworks being invaluable and pretty much what, you know, most of these companies are going through in trying to go from where they are to where they want to go.

Yeah. I mean, I should mention, Priya, that, you know, upon reflection, you know, these principles, you know, come out. And so you get there and these are things that I've managed to leverage, you know, subsequent roles. But if I'm honest, you know, we made lots of mistakes along the way. I don't want the impression to be that, It was perfect sailing all the way. Like we learned some, in some cases, you know, the hard way on what those principles needed to be and to stick with it. And so it, you know, it was a very rewarding journey which I'll, you know, forever be thankful for. But, you know, probably the learning you get out of these situations is probably the greatest benefit for me personally.

Yeah. And I think that the reality of what you've talked about today, you know, is really the what's happening beneath the surface. Because, you know, we can read that next book on, you know, how to scale something quickly or how to, you know, but I think reality is what are the blocks that actually need to go in. I think you've got stories for days from the trenches. And I would encourage anyone who's listening to this, you know, to reach out to you and find out more, you know, about how you could, you know, help them or You know, your experience can be beneficial to them. So, Craig, thank you so much.

Always happy to help, right? Like, have a look at my LinkedIn profile. You can reach out and contact me there, book in a meeting. I love doing this. This is what I, you know, this is what I'm passionate about and hopefully I'll get to do it for more businesses, you know, Aussie headquartered SaaS businesses that will continue to see our economy grow.

Fantastic. Thank you so much.

Thanks for having me, Priyank.