Start with a problem, not a product. The most important thing you can do as a founder is find a problem that all your prospective customers or users have and want to solve immediately. You shouldn’t have to convince anyone to try your product. Ideally, you discuss the problem with them, and they should be able to visualize immediately how you can help solve it. Then, you can explore different ways to solve the problem and build products, but everything will be easier from that point on if they share your vision for solving the problem.
As part of my series about the “5 Things You Need To Know To Create a Successful App or SaaS”, I had the pleasure of interviewing Sean Byrnes, CEO of Outlier.ai. In 2005, Sean started a company called Flurry that disrupted the mobile analytics market, creating entirely new advertising business models for web entities. After selling Flurry to Yahoo! in 2014, Sean created a new company: Outlier.ai. Using AI and advanced analytics, Outlier is breaking the mold once again — helping organizations dive into their deep data pools to elevate relevant and actionable data behaviors. In his free time, Sean acts as an advisor to early stage technology companies, helping them navigate the complex world of technology innovation.
Thank you so much for joining us! 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 always loved building things and loved the intersection of technology, people and design. I majored in engineering and computer science in college, then went on to study artificial intelligence in graduate school, and along the way I was an illustrator and a radio DJ. After joining the workforce, I found that I would get bored with jobs that only express one area of my interest. I was eager to start companies to fulfill my wide variety of interests, and I was happy to find that being a founder challenged me in ways that meant I never got bored. I’ve been starting and building companies ever since!
What was the “Aha Moment” that led you to think of the idea for your current company? Can you share that story with us?
My first company, Flurry, was one of the largest analytics companies in the world, and through our customers, I had a front-row seat to how companies were using data to make decisions. I spoke to as many of our customers as I could and, regardless of what industry, size or location, they all asked me the same thing: “Sean, how do I know what to look for in all this data I have?” I got that question so often that I realized we needed a new approach to data that helped find the questions hiding in the data, instead of just providing answers to questions we already knew to ask.
And that’s the concept that started Outlier.ai.
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?
Starting any business is a roller coaster with exhilarating highs and bad lows. When you close your first customer or hire your first employee you are on top of the world. When something bad happens, it can feel hopeless and like a waste of time. Unfortunately, bad things happen all the time to new companies, and I’ve spent a lot of time navigating those lows.
The darkest moment for me at Flurry was when we ran out of money, twice. We were a mobile application company and mobile apps were not considered to be a great business in the pre-iPhone era. What kept me going was having seen how transformational mobile apps had been for the users who had adopted them and knowing that all consumers would eventually want the same thing. Eventually, the iPhone was released, and mobile applications became the center of the technology industry. But until that happened it was the vision of what was possible that kept us going.
So, how are things going today? How did your grit and resilience lead to your eventual success?
I often tell people that Flurry succeeded because we refused to give up. So many mobile companies closed in the pre-iPhone era and missed the gold rush that came later. We just refused to stop and stayed very frugal so we could last as long as possible. We got very lucky that the iPhone and AppStore were released when they were, but we worked very hard to be in business long enough to benefit from that luck when it came.
Those lessons helped me build Outlier. When we first started Outlier, artificial intelligence was still thought of as science fiction and there was a lot of skepticism on whether we could even build the product at all. I had been through so much at Flurry that the skepticism didn’t bother me, and we were lucky that AI became the biggest wave of enterprise software and that we were once again in the right place at the right time.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
One of the first things you do with a new company is choose a name, but it’s surprisingly hard to do! Choosing a name and buying a domain for your website is a struggle because almost every name you can think of is already taken. With Flurry, we loved the name but the person who owned flurry.com did not want to sell. We eventually convinced him to sell it to us, but the sale price was much more money than we had! It was chaos trying to find the money and make sure the deal didn’t fall through. We did make it happen, but it was a crazy time.
For Outlier, I bought the domain outlier.ai before even starting the company. I didn’t want to relive that experience!
What do you think makes your company stand out? Can you share a story?
Outlier is such a different way of thinking about data. So many data tools have convinced people that data must be hard and that they need to invest months of time and effort to set up new tools. With Outlier, the setup process takes only minutes, and you get value almost immediately in the form of insights about your business proactively delivered to you.
So many of our customers start out skeptical that it is possible, but they get so excited when they realize it’s real. It’s really rewarding seeing all of the cynicism about data tools give way to real optimism when they use Outlier. We had one customer tell us “Outlier promised a really fast turnaround time in terms of getting value out of the tool. We were hesitant, but that was one of the most amazing things: It was true.”
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
The best thing a founder can do for themselves is to realize that their physical and mental health are critical for their company’s success. Too many founders will give up exercise, sleep and social events since they feel they need to spend every moment working on their business. Sleeping well, exercising and seeing your friends are all part of your job as a founder.
If you are healthy, you will make better decisions and that is the most important thing you can do for your company.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
What amazes me about company building is that the most important people are often strangers whom you never meet. I believe all companies exist because of the altruism of their first customers, who take a bet on a risky new product. When we first started Outlier, before we even had a product, we started a newsletter called the Data Driven Daily to help educate potential customers on how to use data to make better decisions. We wanted to start learning from the community, but an amazing thing happened in that people became evangelists of the newsletter and it started growing really fast on its own. We then had many newsletter subscribers who wanted to use our product, even though they had no idea what it was yet, based solely on their love of the newsletter.
Those early evangelists made the company possible, and I will never meet most of them in person.
Ok thank you for all that. Now let’s shift to the main focus of this interview. Approximately how many users or subscribers does your app or software currently have? Can you share with our readers three of the main steps you’ve taken to build such a large community?
Outlier customers are global brands across multiple industries, including leaders in retail, financial services, consumer packaged goods, life sciences and travel. Outlier has focused on solving the unique challenges of each of these industries, while streamlining the integration of the primary data types and systems that they use every day. Our customers experience fast time-to-value and Outlier immediately becomes part of their team’s daily workflow. The flexibility of our solution, combined with the expertise and partnership of our awesome customer success team, has ensured rapid and sustained business impact and enthusiasm among all our customers.
What is your monetization model? How do you monetize your community of users? Have you considered other monetization options? Why did you not use those?
Outlier is an annual subscription, like most enterprise software products. We offer a unique pricing model based on the number of systems you connect to Outlier to analyze your data. The more systems Outlier analyzes, the more the subscription costs. It’s unique in that most enterprise software is consumption based and the price goes up as more people use the product, or more data is analyzed. Our model gives the customer complete control over price with no surprises.
The mistake many companies make in pricing is that they make it a tax on success. Customers don’t want to feel like they must pay more for your product just because they are successful, with more customers or more employees. Our model aligns with the interests of the customer since we want to offer a great experience, so the customer wants to add more integrations.
Based on your experience and success, what are the five most important things one should know in order to create a very successful app or a SaaS? Please share a story or an example for each.
It’s hard to pick just five, but here are my choices:
1. Start with a problem, not a product. The most important thing you can do as a founder is find a problem that all your prospective customers or users have and want to solve immediately. You shouldn’t have to convince anyone to try your product. Ideally, you discuss the problem with them, and they should be able to visualize immediately how you can help solve it. Then, you can explore different ways to solve the problem and build products, but everything will be easier from that point on if they share your vision for solving the problem.
2. Obsess over the “day zero” experience. So many companies spend all their time working on the product experience for expert users and ignore the process of getting started in the first place. The initial experience forms the customer’s impression of your product, and the easier it is the more magical their impression will be. You cannot create evangelists if you don’t harness that magic, so you need to hold onto it.
3. Distribution is all that matters. Many founders love building products, but the best products rarely win in any market. What wins is the best distribution, since the faster and cheaper you reach customers the faster you can grow. The founders that focus on distribution, marketing, partnerships or whatever works in your industry, are the ones that succeed.
4. Hiring is a skill, so work to improve it. Any business is a result of the people who are building it. If you want to recruit the best people, you need to be the best at hiring. So many companies have horrible recruiting processes, and the employees who work there take those horrible processes and bring them to their startups. The best thing you can do is really study recruiting and build a better process so that you stand out.
5. Focus. The best companies are chaos on the inside, even if everything looks great on the outside. What makes them the best companies is that they do one thing better than anyone else. They do that one thing so well, it makes up for all their problems, mistakes and chaos. You should figure out what the one thing is that your company will be the best at and focus all your energy on that, instead of trying to be perfect at everything.
There are thousands of more lessons, but those five are a good start!
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. 🙂
The technology industry has a very serious discrimination problem, specifically racism and sexism. So many technology startups have founders who have no prior work experience, so even if they have good intentions the company culture becomes toxic and enables discrimination to take root. Companies also inherit bad habits from other companies through the employees they hire, and the problem becomes systemic. These problems then manifest in the products these companies create, and technology products are part of the lives of almost every person on the planet today.
I would love for technology companies to be held accountable for the quality of their culture so that there is an incentive for them to address these problems. Prospective employees of every race, gender and ethnicity should demand transparency from companies who want to hire them. What actions do they take to combat racism and sexism internally? What is this company doing to eliminate racism and sexism in their industry? Once there is an economic incentive to run a technology company well, we might finally see real change.
How can our readers follow you on social media?
Absolutely, you can find me on Twitter as @sbyrnes.
This was very inspiring. Thank you so much for joining us!