Focus on products, not services. A service-based company is hard to scale. Build products or products-selling companies. There is a reason that top Fortune 500 companies either make products, make and sell products or just sell products. Services are a great way to build tailored experiences for your customers but what gets you to the top is working and improving your products and the marketing strategy.
Building a great product is really useful only if enough people hear about it. Build a strong marketing and sales operation. You know of the old saying “If a tree falls in a forest and no one is around to hear it, does it make a sound?”. The same thing goes for great products. If no one knows about it — you might as well have never built it.
As part of our series called “5 Things I Wish Someone Told Me Before I Began Leading My Company” I had the pleasure of interviewing Mike Dragan, founder of Oveit, a global company focusing on live experiences technology, both virtual and in-person. Oveit was started in 2016 with the goal of improving how brands deliver live experiences to their customers and now serves over 3000 customers across 4 continents. In 2020 the company launched Streams.live, a live commerce software that is transforming retail. Mike has an experience of over 15 years in building digital products, with a focus on digital shopping. He has worked with some of the largest consumer brands in the world, advising on their digital go to market strategy. Mike Dragan holds two degrees, one in International Economics and one in Computer Science.
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I’ve started in the early 2000’s in the tech industry, at an anti-virus company. The company was later acquired by Microsoft. I worked on building the website, which was the kind of work the older programmers wouldn’t do. I loved working with websites and building web tech so when I applied for the job, I knew I wanted to work there even if that meant working for free. As I never had a job before I actually asked for less than the minimum wage, which was something they couldn’t legally do. I learned so much in such a short time that in just one year I was getting multiple job offers.
I switched jobs to an up-and-coming software company. It was a very diverse and interesting group of people that worked on all sorts of cool tech stuff, outsourced by other companies. I was the only one doing web tech. I worked a lot on user interfaces and because it really caught on, I started building a team around me. It was all organic and if you were good enough at your job, you could choose any title you wanted, and I chose “Creative Director”. I noticed advertising agencies all had this cool, bohemian character working for them. They were getting the best projects and lived a thrilling life. Being in my twenties, I thought — I want to be a Creative Director as well. And very soon I was. The company shifted to a new niche — digital advertising — and soon enough I was a Creative Director in a Digital Agency, doing creative and fun projects on the web.
Soon, I hit an upper ceiling. I am a fast mover and I noticed that in my third year I didn’t grow anymore. It seemed there was no place for me to evolve so I thought — what else can I do? “I guess I’ll start my own agency”.
And that I did. At 24 I started my own company with little to no managerial skills. All tech and user interface design. I knew I wanted to continue building great projects, so I started solo. As more and more projects came in, I hired some of the people I knew were most skilled and wanted to work with a new company. We quickly grew from one to five employees, from five to 25 and so on. We started with one office and grew. By the time I was 28 we were around 45 people, in 4 cities and we won more than 30 awards for creative digital projects. And then the 2008 recession hit.
A lot of our customers were businesses in areas that were heavily impacted by the recession in 2009. We took a hit as well and I thought we would be ok, and I’ll manage to get the company across the recession without having to fire anyone. We actually acquired another competitor, and we were struggling with integrating the team and its technology with the existing one.
It didn’t work out. By 2011 the issues were so hard to fix that I was just putting out fires every day and couldn’t really manage the company. I downsized, closed all offices outsized the core but it was pretty clear that the issue was deeper than the management and financial issues. The whole concept was flawed and by taking agency projects we were actually onboarding unprofitable segments of other businesses.
I decided to close the agency and not look back into building another one. It just wasn’t a good fit for me.
I went back to my roots and start a software product company. I was a bit tired and demoralized by the last years, so I asked a few people to work with me on building an ecommerce business as a cofounder. I actually didn’t use the term cofounder and I didn’t know exactly why anyone would share their company with another person, but I knew I wanted to share the workload and risk with someone else. I knew Andrei, my current co-founder, had an Ivy League financial education background and had managed loads of people. Most important was the fact that I respected him and I felt he was someone I could really trust.
It took us about two years to build and sell an omnichannel retail software company. The product helped merchants that sold both online and in-store have control over their sales across all channels. It was a much better experience than my previous one. So, we thought — that was nice. Let’s do it again.
We had noticed just how popular festivals were becoming and at the same time just how low-tech events were, compared to the retail world. We set out to bring a better experience for people planning large events and managing large venues. To make this happen, our team invented a system that allowed anyone to manage cashless payments, with very large numbers of people in the same spot, even when the internet was down. We called it Oveit Pay. Oveit as in Love it. That looked a bit like magic so it was a global hit. We now have more than 3000 customers from all over the world. To make up for changes in our market, in 2020 we launched a digital version of it that combines shopping and entertainment into a thing called live stream shopping.
What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?
We’ve actually launched our company already in the event management space. We built an awesome tool to sell tickets and accept visitors at your event. It had all the great features that we noticed meant the world for online retailers.
It’s just that it didn’t work. The market was crowded and there were literally hundreds of other solutions that were doing something similar. We had some initial growth, but we understood we would be no leaders in the field. So, we were looking for a “killer app”.
We’ve been experimenting for sometimes with using RFID in venues. This was in 2016. We knew just how useful RFID was in retail, managing movement of goods so we thought we could use the system to allow visitors to skip the queues.
But in 2017 we received a call from someone doing a festival on an island. About 3000 people, 5 days, EDM, camping, drinking and lots of fun. They wanted a way to allow people to pay without using cash. A deserted island and cash were not a good combination for a festival. People quickly spent their money and then had to travel by boat, drive an hour, get money from an ATM and come back if they ran out of money. So, it had to be cashless. Cool, we said, we have this project that we can use to store value on RFID wristbands.
There was only one thing — the island had no internet, no electricity and no mobile phone connectivity. Nothing. There was no way for us to use our servers. And there were three more months left until 3000 people would arrive on the island in search of fun.
We tested all sorts of combinations of technology that might work. We knew we could only build one fully. There was not enough time for failed tests, so we went with something that sounded really cryptic — a sort of blockchain that ran locally, on mini-PC’s, through the wireless network, disconnected from the internet. The payments were processed on mobile devices.
It was really scrapy, but it worked. We were on the island, no technology outside our own. No internet, no mobile signal. But people paid using cashless wristbands. It almost seemed magic. And we saw just how impressed they were when they tapped their wristbands, a small chip holding funds. Just how much more careless they were that they could enjoy themselves without any fear of losing their money. We loved the combination of technology fully embedded in an environment where culture and nature came first. It was magic.
That was the a-ha moment. We knew this was our spot in the world. We knew we wanted to bring technology that combines entertainment and shopping and do it at scale.
Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?
Yes, we did consider giving up. In the early days we’ve spent a lot of work on some product features we discovered were useless and the market had no need for it. We already had spent most of our cash on those product features and couldn’t really raise more if we didn’t show product market fit.
So, we had to work with what we had. We discovered there was a small piece that we’ve been working on that had some potential. The RFID cashless payments part. So, we decided to go with that and hope it will all work out.
The second time when we considered closing shop was when the pandemic hit. The stark contrast between what we’ve planned and what was actually happening due to this unforeseen event was what made everything worse. We’ve planned global rollout of our new products and now the whole industry using our products came to an abrupt halt. We actually asked ourselves — will live, in-person events actually come back? Like — ever?
We could have waited to see, close the company and return the remaining funds to our investors or we could, again, run with what we had and do what we could in a reality that was shifting daily.
So, we decided to reinvent ourselves while keeping our core values intact.
I think people often think of the backstory and give themselves more credit than they should. The truth is that in both cases we didn’t have another choice. We needed to find a way out. We’ve already burned all our bridges behind so there was no way out but forward. We had no savings, no side-projects. If we couldn’t reinvent ourselves the future didn’t look too good.
One thing that I did notice is that in every seeming failure there is always, always a way out. A way to create something amazing when all seems lost. You just need to trust you are capable of finding it and put all your energy in transforming that little glimpse of light into a bright star. I think that’s the most amazing thing about us humans. We can literally wish reality into existence, if we concentrate our efforts.
So, how are things going today? How did your grit and resilience lead to your eventual success?
We went from a small EU company to a global company worth north of 10 million dollars in just two years with our cashless payment solution. We went from 30 to 3000 customers in that same timeframe.
When the storm hit again, we used the same technology to transform ourselves into a leader of live stream shopping software and now are onboarding hundreds of corporate customers and helping thousands of retail workers find meaning in their work again.
Most important — we survived. Our whole team survived. We haven’t fired anyone and hopefully we’re helping create new, more fulfilling jobs at a time when this is very much needed.
We expect 2021 to be our best year yet financially. What matters more — we feel we have become a company that really serves society when this is surely needed.
What do you think makes your company stand out? Can you share a story?
I think what makes us stand out is our ability to make seemingly impossible things happen. The first time I noticed that was on that deserted island, in the middle of the Danube river. No technology in sight, no internet, no electricity but people were tapping small chips and payments were made. At a very small scale we created a sustainable economy operated solely on a local system. That was 4 years ago, and it still sounds like magic. People were using our tech without noticing it. They were living an amazing experience in a wonderful community that was exchanging value in a way that was not possible before.
The second time I noticed that was at the end of 2020. We were in a large, now empty, showroom of the Renault Group. Their sales have dropped even though people wanted to buy cars. They couldn’t. Dealerships were closed and no one dared open them in fear of infecting customers or staff.
No car was sold live before. We didn’t know if it was possible. We tested our live shopping product with smaller items in the fashion and beauty space. But cars? That was nuts.
As per our usual or mission was seemingly impossible and on tight timeframe. We had 2 weeks to prepare for a live session of car selling. Ideally, some cars would be purchased in the three days the session was running. We got to work and set up a studio in place. Actors were hired and trained on how to present the cars. The first day came.
In the first 10 minutes of the live session, we knew we had a winner. Every minute we were adding server after server to keep up with the demand. Tens of thousands of visitors joined the session. Asking questions, they got to know the cars better. They clicked and purchased. Cars were sold in matters of seconds. I’ve worked in digital retail for more than 15 years and that was like nothing I’ve witnessed before. We then knew the world was changing and we were a part of this change.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
It’s 2008, I think. We just did a bunch of creative digital campaigns for mid-sized brands. One of them involved cats. There was this craze back then with using cats in digital media that worked really well when communicating to end consumers. It worked really well in a fun game we did for an audio ecommerce store. It was basically Street Fighter with cats, on an audio store. It generated buzz and people flocked to the site and subsequently purchased audio gear. I know — quite a stretch but the team was young, creative and basically did everything because it was fun.
We had a good run with this and other projects. So good that we were invited to one of the largest pitches for digital advertising. The customer was a big telco company. Given the fact that the project was so important we had our presentation with members of their board. All seasoned executives, trying to understand and adapt to this “ecommerce thing”.
We brought in the big guns. Cats. Our whole presentation was illustrated with cats and our previous successes. We really wanted to stand out. I read somewhere that that’s what advertising creatives were doing. Exploring the limits of interaction, standing out, being different.
The presentation starts with a cat message. Another one. And another one. By the middle of our presentation, we knew we lost them. Eventually, one of the executives stops us. Basically, they wanted to know whether this was a prank or something. They were expecting strategy for their ecommerce store and we were showing them cats. What’s happening?
We didn’t get the contract.
What I’ve learned from this was there is no one size fits all and you should adapt your communication style to the audience. Quite an important lesson if you’re working in digital advertising.
Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?
Don’t raise, grow organically. Bootstrap. This might work for other industries, but in a very fast paced, innovative industry such as software tech, bootstrapping basically shortens your vision.
We’ve started as a bootstrapped startup, funded by me and my cofounder. We worked in the event management space for some time, doing ticketing software, slowly growing, until we raised our first (small) seed round. That moment gave us some months of runway. You would think that made us slack off a bit but no, it gave us perspective and made it easier to understand what we should (and most importantly what we shouldn’t) do.
In less than 1 year our whole company trajectory was transformed. We got larger customers and made our existing customers lives even better, we scaled throughout the world and this made it easier for us to start global partnerships.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
Let’s first define success. If we were to compare ourselves to the likes of Elon Musk or Jeff Bezos, we might seem like not much of success. I think much of what we call success in our current society has to do with two things: wealth and fame. Basically if you have those, you are successful. The scales might differ and they constantly adapt to the new reality. If you’re worth 10 million dollars you might see success as having 100 million dollars in your bank account. If you’ve been on national television, you might think success is having global coverage and so on.
The way I think of success is being able to build useful things for as much of our fellow humans as possible, adding value to the world instead of extracting it and generally being better today than you were yesterday.
When the pandemic hit, we knew that this would affect a lot of the world in many, many ways. We had a tool that was used in live environments and events and we knew that many of the people involved in these industries would be affected. We’ve asked ourselves — what would it take for us to build something that would help our customers thrive in these complicated times.
We built the live shopping tool based on what we saw at live events. Our live shopping tool was used in festivals and large venues to connect customers to local vendors. We wanted to move this to digital and help as many vendors recover from the pandemic. When we saw this was working and people were connecting with one another and exchanging value, while having fun, we knew this was something that made us even more useful than prior to the pandemic. Now this is our main goal — making sure people connect and exchange value and experiences, even if they can’t connect in physically.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
Sleep. Eat healthy. Walk or work out. Enjoy time with family and friends. These are the best things that help me stay sane and productive. I think it’s really important for people to realize we are not very much different from one another. You cannot lead others if you cannot lead yourself to get 8 hours of sleep a day. How can you build a healthy organization if you are not keeping your most prized possession (your body) healthy and productive?
Our technology has evolved dramatically in the past hundred years or so but our bodies and brains are still in the same place they were tens of thousands of years ago.
What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?
They don’t talk to their customers. Maybe it’s just a fear of being proven wrong but discussing your ideas with others is not a top priority for many starting founders and CEOs but it’s present in almost all successful founders. Maybe the tools to understand the market change at scale but they all connect to their audience.
The way to avoid this mistake is to just go out and discuss with your customers, prospects and basically anyone that would listen to your pitch. You will start to see the patterns. Set a goal of discussing with at least 6 customers per week. That’s one more than the workdays you might have.
This experience will be great afterwards as your marketing messages will mirror exactly what you heard were the problems and the solutions.
In your experience, which aspect of running a company tends to be most underestimated? Can you explain or give an example?
I would say that the most underestimated aspect is managing people. It’s so hard and so delicate. Most business courses of books simplify human beings to simple automatons. We are not machines, we are the apex of billions of years of evolution. Each and every one of us is a complex system of biochemical reactions that results, amazingly, in intelligence.
For all we know we might be the only planet that holds sentient, intelligent beings. We still claim that an MBA or a prestigious university or some fancy course will teach you everything there is to know about helping other fellow humans to achieve their full potential.
Managing is hard. If done right.
Ok super. Here is the main question of our interview. What are your “5 Things I Wish Someone Told Me Before I Began Leading My Company”? Please share a story or an example for each.
1. Raise funds. Capital works: I used to think we could bootstrap our way to a million dollars in ARR. It’s very, very hard to pull off something like that and very taxing on your mental and physical health. There are many VC funds out there and raising funds is part of building a business. Of course — you will get a lot of no’s — and we did get plenty but the good thing about people telling you no is it doesn’t cost a thing. Once you understand it’s just a numbers game — you’ll be fine. The more no’s you get, the closer you are to a yes. Obviously — you shouldn’t just hunt for people that say “no — we will not fund you”. Try to understand why they won’t fund you. Be flexible, adapt and in the end, you will reach your goal.
2. Focus on the right metrics. This usually means financials and product usage. I am a very technical person. I like coding and designing apps. I like bits and servers and databases. But a business is a very complicated system to pull off and its essential metrics lie in the financials. Revenue, profit margins, annual and monthly recurring revenue, forecasting, cost of goods sold and all these financial indicators — they are really, really important. Ignore them and you are basically flying blind.
3. Don’t trust your guts. Trust data. I’ve heard somewhere that 95% of our brains don’t understand written language. That part of our brain acts like we’re living 20.000 years ago. It helps if you’re chased by a tiger but not really helpful in the age of electric cars and AI. This means we are not evolved enough to just trust our guts. Get data, understand it and act on it. I now understand that yes, Jeff Bezos might trust his guts, Elon Musk might as well but their intuition is much better than mine. I need data.
4. Focus on products, not services. A service-based company is hard to scale. Build products or products-selling companies. There is a reason that top Fortune 500 companies either make products, make and sell products or just sell products. Services are a great way to build tailored experiences for your customers but what gets you to the top is working and improving your products and the marketing strategy.
5. Building a great product is really useful only if enough people hear about it. Build a strong marketing and sales operation. You know of the old saying “If a tree falls in a forest and no one is around to hear it, does it make a sound?”. The same thing goes for great products. If no one knows about it — you might as well have never built it.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
I think brain cancer can be cured. It’s an awful disease and it comes in many forms. It can affect anyone of us from the youngest to the oldest. I am planning on starting some efforts in raising funds for research nonprofits that work on brain cancer research.
I think that combining our recent advancements in biology/immunotherapy and data science we can actually create cures for all sorts of diseases. My focus in terms of philanthropy is on helping find a cure for most if not all forms of brain cancer.
How can our readers further follow you online?
This was very inspiring. Thank you so much for the time you spent with this!
It was a pleasure sharing my thoughts. Thank you for the invitation!