Andrew: Hey there, freedom fighters. My name is Andrew Warner and, um, everything is in chaos here. I rented office space so that I could record today with Ray Hein, um, this interview, and I’ve been schlepping all my equipment back and forth from our Airbnb here in Austin to the office that I’m renting here on this bike that I bought with Penn years.
I never had Penn years. I liked the idea of penny years. Um, I brought everything. Except my iPad with my notes. And I’m so dependent on the iPad. That actually, it’s probably a good thing that I didn’t bring it here because I don’t want to be dependent on any one thing. Be flexible. And so today we’re going to be a little bit flexible and Thanks, to my team.
I can be, they put together a great set of notes. All I lost is my notes, which are still at home. And thanks to them. I could have this conversation here with Ray Hein and I could talk to him about propel and we can understand how propel helps physical product companies go from concept to commercialize.
To delivering their products. Um, I think the best way for me to explain it is the reason I could be here is we use project management software kind of it’s it’s software called pipe drive. Every step of our process is organized. So I knew sitting down here that my iPad may not be here. This office may have all kinds of issues with it.
And it does. I don’t know why people need to use dishes at 10 56 in the morning. Like, what are you doing? Work people, um, But despite all those issues, I know that my team is going to have Ray’s contact information, that his contact, that the link for this meeting will be on his calendar, that the notes will be set up in the proper way, because we use software to manage it.
Now, physical product companies can’t use the same software that we use to manage their, uh, processes. And so that’s where propel Ray’s company comes in. And this was a stodgy old industry and he decided that he was going to jump in and. And I’m surprised that he didn’t start a company before, but I wonder if it’s because he had an issue with another great idea before this one, but he’s got to hit now.
And I invited him here to talk about this, hit with propel and thanks to my sponsor HostGator. We can find out about it. And Ray Hein. Good to have.
Ray: Thanks, Andrew. Yeah. And, uh, I’m really excited to share this story, but I’m going to amplify, this is actually my second time around at starting a company I’ve been involved in. Many S uh, startup companies that have had various levels of success. The two of them went public one didn’t. Um, and then, uh, back in the 2007, 2008 timeframe, I did start a company, uh, called bright minds.
And it was a company that was thinking about how we can increase the pace of innovation by using social networks. So it was kind of like a private, private, LinkedIn back in the day,
Andrew: That’s what I was talking about and it was challenged, but, it was on the right track. What was the idea behind.
Ray: Well, the idea was to try to get like-minded people, um, investors, uh, people that had domain that could come together and solve problems and commercialize patents that were sitting dormant. And, uh, I thought it was a great idea that people were talking about open innovation. Um, and we still have had challenges with commercializing patents, uh, in the country and, and really driving, you know, the pace of innovation to all it could be.
Um, so, you know, I shut the company down pretty quick, cause it was oh 7 0 8. It was the economic downturn and, uh, you know, getting funding at that time. Challenging. Um, but I always knew that I would be an entrepreneur and, and that it would, uh, present itself again at the right time, which happened to be 2015 when we founded propel with some folks that, um, I had worked with in the past.
Andrew: Right. I’m always curious about when an entrepreneur has a setback like that, how they personally react in my mind. What I do is eat either I avoid it, or I get really down on. I’ve interviewed some entrepreneurs who are so oblivious to the setback, to the failure that if I say to them, it was the founder of me.
We, I said your business failed. It didn’t fail. I go, yeah. The previous business failed. You started this social network. It w it went bust because no, it didn’t. I go, why not? He goes, because just the fact that you try means that you’ve succeeded. Most people won’t try. I tried it. It was great. And I believe that he really is on board.
I’m different way. I’m wondering what your, like, when you had bright minds basically shut down. What, how did you feel and how did you bounce back?
Ray: Um, you know, I’m, I’m a big fan of. Uh, of a book that was called the self esteem, prophecy written, you know, I don’t know, 20, 30 years ago by a gentleman named James Redfield. And, um, the, the underlying theme is there are no coincidences. So, you know, I took it and looked at it and say, what did I do? Um, what worked well, what didn’t and what do I need to do differently and take it forward.
And really Andrew, at that time, you know, it was, I was bootstrapping it with my own, you know, the hind family trust, um, you know, put almost a, uh, almost a million dollars of my own money into the business, um, to grow it. And, um, so yeah, that was the biggest disappointment that it didn’t. Get legs, but I learned a tremendous amount through that process of what worked well and what didn’t.
And, um, the big takeaway was the team I pulled together. We were all at different personal life cycles. Some of the team had young kids. I had kids that were in, in high school or going into college. Um, the market wasn’t there. I didn’t do enough market validation and we were early. It was a great idea, but we were early, we were probably five, six years early into it.
So, you know, I, I really dug in and took the learnings out of it and said, you know, there aren’t any coincidences. This thing is not going to. But how can I learn? And then, uh, what do I need to add to my skillset? So when the next idea comes to mind, um, how can I take advantage of that and seize that opportunity?
So I didn’t dig in, yeah. I beat myself up for a couple of weeks, but it’s like, nah, you take away the learnings and,
Andrew: Just a couple of weeks.
Ray: for it.
Andrew: Just a couple of weeks, literally. and, then it was, what can I take away from this? And there are no coincidences. This is not just some random thing that happened to me. This is meant to take me to something. I don’t know what yet, but I’m going to add to my knowledge and go where I’m going to go with this.
That’s it.
Ray: I did I did. And then I got, I got pulled into a couple of different companies that were out of my domain and I grown up building a company called agile software, where we took it from, you know, a small team to taking it public to then ultimately selling it to Oracle in 2006. I started bright minds just after that.
But, um, I decided, boy, you know, I need some other broad experience outside of PLM. And I went into different software categories that PLM, uh, sorry about that. Yeah. Three letter acronyms that, that our audience isn’t gonna know. Um, it’s called product life cycle management. It’s the fourth largest largest software category besides enterprise resource planning, customer relationship managers.
And human capital management. It’s an enterprise business category. That really takes all of the information about how products get defined and designed, and then ultimately launched into the market. So it’s a collaborative, collaborative software category, that’s enterprise business, but it’s been around for 20 plus years.
And so, you know, my, my. My learnings were that I needed to try something different and, and head down a different path. So back at that time, you know, it was the early roots of analytics and, and software as a service or SAS platforms. So I honed my skills and spent some time in those categories. And then ultimately, you know, back in 2015, decided that I was going to start my new company pre.
Uh, based on, you know, some of the learnings that I had recently.
Andrew: I see, uh, I looked at your LinkedIn profile and I saw every couple of years or so you moved positions and this is partly what you’re talking about. You wanted to learn about, I guess you were doing. It wasn’t desktop software, but it was, it wasn’t cloud-based software that you were doing before. And you said, I want to see what SAS is like.
I want to see what this other industry and what did you learn from all that from the roughly 10 years of, of moving around.
Ray: Yeah. So I think there’s two answers there, Andrew. I mean, I learned there’s a technology answer of learning that, you know, the, the market was shifting from, as you pointed out, um, On-premise servers, big, large rooms of computer servers and relational databases to cloud-based software. So there’s the technical leg of boy.
It’s not going to be the same of selling software that way. It’s not just the subscription model and the pricing, but how we deliver in can. Faster by using the cloud. That was one path, but also, um, I kind of remade myself along the way. So I had been, so there’s the, that my career in the technology side.
So the second leg was, I knew that if I was going to start a company and be a CEO, I needed to not only understand the product side, which I had built my whole career on, but I got involved in one company, um, that, uh, put me in as a head of marketing, um, and had a product strategy. And I didn’t have traditional marketing skills.
I mean, I, I knew market messaging and positioning and some basic things along the way, but I honed my skills on understanding markets and how to launch products into a market by working for two plus years at that particular company. Um, I went to another company and they put me in charge of not only, um, the product teams and product strategy, but product marketing.
And then we had problems. In our products that I’m in the SAS world use customer success. Management CSMs to work in retain customers. And so I got involved where I had to deal with all of our customers after they had been sold, not just designing and launching it, but boy, the problems that they had with the product and how do we resolve them.
So I kept adding these other skills. For other roles that you need in a company. And it gave me, you know, the insights of how these other job functions relate. So that as I became a CEO, that I felt I had the skillset to know what those, what, what, what good meanings, so that when I hire people to fill those roles now in my company, I have an affinity to what they have to do, and I understand their roles really well.
They’re professionals. They do their jobs way better than I could ever do. But understanding how all that functions in a company come together, or some of the skills I was able to attain, you know, after that, that failure of bright minds, I learned a lot by playing different roles to know that I could become a CEO in an entree.
Andrew: I’d have a hard time bouncing from role to role because yes, I would learn a lot, but I would always be new. I would never Excel and be better than anyone else there. And I’d feel like I wasn’t contributing enough. Wasn’t earning enough. Wasn’t doing enough. How did you get, did you feel any of that? And now, as I say that out loud, That’s a feeling I should just put aside.
If what I’m trying to do is learn different aspects of the business. Did you feel any of that? I’m not at where my strength is. You did.
Ray: no, that’s a good, good question. Um, yeah, I mean, people, people call it the imposter syndrome, you know, you’re, you’re going into a role that, you know, it’s not natural or feels good to you. Um, And no, you know, I always took it and said, what, what do I need to do? I’m very analytical. So I, I really decompose things into what are the big blocks that need to be focused on and work on those things and become as good as I could in those, but know that I couldn’t be as good as somebody, that, that was their professional role.
And they, you know, might’ve had academic training or had had 10, 20, 30 years of experience. So, um, You know, I’m, I’ve always been somebody that has been naturally curious. And, um, you know, when we look at the, kind of the core tenants of what we built the company on propel, um, it is about curiosity and courage.
And I really, one of the companies that agile software back in the day, and in the mid nineties, the CEO founder there, he had always said, two years go into a role, take it be the best you can for two years. And then change it up. And he’s a venture capitalist now, very successful person. You know, our company was very successful then.
Um, but it was one of the things I took away and learn for him again, not a coincidence as we talked about, you know, there are no coincidences, we encourage the same thing. Um, you know, here at propel that. Do a job, do it really well for two years and then stretch yourself and force yourself to continuously learn, uh, on that side.
So don’t try to stay in the same career for 10, 12, 20 years and go deep. I think today, you know, in fast paced society. Natural curiosity. People want to change. They want to be challenged. And so I accepted and embraced it. And I think certainly it helped me become an entrepreneur and a CEO at the end of the day.
And we’re doing the same thing with our, our company today.
Andrew: Where’d the idea for propel come from.
Ray: You know, um, good question. I, the category itself of, of product lifecycle management PLM as, uh, been, uh, an on-premise category and in the 2005, six and seven timeframe, there was a lot of acquisitions that had gone on, and then those companies just got stuck. And, you know, here it’s a category that should be driving innovation and helping companies create amazing new products, but the category of software got kind of stodgy
Andrew: What was wrong with it? When you say stodgy, what, what was it looking like compared to what the rest of.
the world had?
Ray: Um, it, it had not modernized, uh, the user experience. It was largely built as a technology platform to like custom code, how you would launch products. So it was very expensive and inflexible to change. Um, and so companies didn’t do it. It’s like the old, the old accounting systems that, you know, green screen, old school.
So. The workforce is shifting and people are looking for more modern experiences and they want things to happen faster and have things that work their way in, in more collaborative ways. And so the idea came out of boy, it needs to be modernized for the new work experience. And I looked at, you know, the, the analysts that follow the big analysts, gardeners and foresters, and the big software analysts and started chatting with them and saying, I think the category is going to go through a massive shift, but it hasn’t happened yet.
And they said, we think you’re right, but it’s going to be like 20, 22 to 2025.
Andrew: Why what’s the holdup. So when I, when I leave this world that I’m in right now where the, the, the app that I’m using now to record with you is so good. It told me what device you are using to record on. And.
we knew instantly just looking at this screen, that your mic from the computer was being used instead of the Mike, from the headset it’s built for podcasters everyday, it’s improving the.
The CRM I’m using keeps updating and my assistant will just drag and drop whatever she wants. And then I go into the healthcare industry. Like I had some genetic testing, turns out everything is fine, but I couldn’t understand that everything was fine because I couldn’t log in. They made it so excessively difficult.
And I feel like I’m going back in time. I understand why with them, they’re trying to be protective of my information. I’m not the customer. It’s some doctor who’s not even my doctor is a customer. It’s someone who she worked for. What’s the problem here with this software that who’s holding it up. That’s that’s keeping it so old.
Ray: That’s a great question. As I mentioned, those, those companies that were, um, you know, back in the. Oh, 6 0 7 timeframe, those larger companies, it was on-premise software. And they spent millions of dollars, hundreds of thousands, if not millions of dollars to implement it and to change, it was, was very, very expensive.
And so it was just easier to let it. And not invest, but the problem is that, you know, the workforce has changed the way products are, are launched. And the fact that we’ve got this compressed innovation, I, I always use this term that, you know, products are coming out faster, quicker. We’ve got more global competition in products.
And that to launch successful products, you need to be nimble and flexible and adaptable. And I use this, this model of like the slinky, you know, you stretch the slinky and we’re seeing this compression of time to market, um, trying to drive products into many new ways of selling. I mean, e-commerce exploded over the last two years.
Because of COVID and living at home. So how we design, manufacture, commercialize, or launch new products and sell them, and then service them has radically changed in the last 20 years. But
Andrew: But the reason that they didn’t update is because they, that most of the clients in this space invested a lot in the old system and they weren’t going to throw it out for something newer and. Okay. So you said you talked to the analysts at Gardner and other companies. They said, yes, it should be updated.
It will be updated, but it’s going to happen years in the future. You said, I think I can move this faster. And what’s the first step you took to do this? Did you raise money first? Did you start developing some of the software.
first find partners?
Ray: No a great question. Um, two things I did, one was I did the market about, as I said, the first failure of bright minds was not doing the market validation. So I spent time really making sure that if I was going to spend the next 10 years of my life building a great company, there was really going to be a market there.
Then I looked at it and I prototyped a few things on, we are built on top of Salesforce’s underlying platform technology. Um, you don’t need to use Salesforce to run propel, but I prototype some things myself. And then I went and talked to a couple of investors and venture capital folks. Um, in particular, a gentleman named Matt Holleran.
Cloud apps, capital, who I knew for many years, he was an early person in the days of Salesforce and in their partnering area. And he had invested in some successful companies that had also built businesses on top of Salesforce companies like ServiceMax and Viva that have just been wildly successful.
And he said, Ray, you’re on this. It was literally Andrew, uh, a coffee meeting with my little prototype, some chicken scratched, um, drawings and slides, some notes I’d taken from the, the analyst side. And he said, Crispen that up, put it into, you know, 10, 12 slides. Let me share it with a couple of my, my colleagues and the investment side.
He goes, but I think we should go for it. And he said, there’s this guy, I know Ron Hess. He’s an amazing Salesforce architect. Um, you should talk to him and if he says you can build. I’ll find it. And it was literally two coffee meetings, Andrew, that we had. And, um, I, I, I often, you know, when I tell this story to people like you, or even employees, when they go, how do we start the company?
That’s like, it was three months of research, two weeks of a prototype. Then it was two weeks with Matt hollering and back and forth two weeks with Ron Hess, doing some validation. Matt then said, yes, I believe in this. I’m going to write the check. Ron quit his job. Two weeks later, we started the company. I had another co-founder as well.
And we had these two week increments of these mini milestones. People talk about agile sprints and doing things in two weeks. Well, we built our business in two week increments. So Matt said, I’m going to fund you. Two weeks later. Run was an employee. We were two weeks later sitting in attorneys’ offices.
Uh, incorporating the company. Two weeks later, we had a term sheet two weeks later, we had three employees. Um, uh, we were coming on knowing we were actually getting funded. Two weeks later, we had our first $2 million in the bank and we had six people going yes from, from cloud ops capital.
Andrew: I’ve noticed that we haven’t mentioned them. How did you talk to customers?
Ray: We did. Um, we did talk to customers along the way. I did that market validation to make sure that if I built something new, that it was going to be, um, of interest. And in fact, the day, the day we, uh, uh, actually signed our legal agreements to get that $2 million. Um, my two co-founders and I went down to Southern California and we’re showing our little prototype to three perspective customers in Camry and Ventura and so forth.
And they said, yeah, you’re really onto something. So we were already pre-selling the notion off of a prototype, right when we were getting funding. And, um, we had milestones that we were going to take about nine months to a year before we would really bring product to them. And we came out with our R one Datto version of our product and had, uh, our first three customers within nine months.
Andrew: Why, why were they willing to scrap the old software that they had it considering that this was an issue for competitor?
Ray: Well, they were paying, um, software maintenance dollars on a product that hadn’t had any innovation in seven or eight or nine years. And we came out and solved problems. When you come up with a new company, it’s a software. You have to think about, you know, what pain are you solving and what use case are you solving?
Like you said, you’re using this software because it’s super easy to use. Everything’s right there. The user interface is great. And so they were having issues where paying money, not getting any new innovations and they were having challenges with their own employees. Um, it was taking longer, the old. Uh, to do their jobs then.
And the fact that, you know, the way they were working was different than when they bought the software 10 or 12 years ago, people were going outside the system and using, um, spreadsheets and communicating over email and they were losing.
Andrew: Oh,
Ray: that was a much faster, much faster way of getting their job done.
And so there’s a notion, Andrew people talk about shadow it, that if. Business systems don’t work. People go outside. Cause he goes, I still have to get my job done. If the, it doesn’t work for me, I’ll find a way.
Andrew: You know, so what you’re saying is that people at these companies, instead of using the software that the company had paid for and was paying maintenance for, they were using spreadsheets, email, and all the other stuff that we know to mean T to project manage. Got it. And that’s that that’s a pain that would drive them to you.
They signed up with you. How basic was the first version? I mean, it took a year, so you obviously had more than just a simple MBP, but how detailed was it? How much, what could it do?
Ray: You know, we, we did about 70%, uh, of what, 70% of what their older systems did on our very first iteration. And it was because we built on this new cloud technology that what. Taken me three or four years to build in the past. Um, only took us a year to get done to about that 70% for those initial customers.
And it solved enough of the problems that they were having, that they were willing to say, you got, seeing how fast we could develop. They bet on the come saying we can start deploying it. And then what’s next and next. And we laid out a very clear path to that would match what they needed for those first 10 to 20 customers.
And you know, now we’re, we’re north of about 150 customers that have been using propel for the last six years. And we’ve got. Amazing small to medium companies and very large, uh, logo companies as well. Um, we just, we just held a customer event where we had folks from HP and shell and Roku and K licks and Vizio and desktop metal that makes a cool 3d metal printer.
Um, you know, all touting how we’re helping them increase the pace of innovation, um, and getting them. More adoption from their, um, from their, uh, from their, uh, customer, uh, from their, uh,
Andrew: from their team. And so, uh, so a team like rope CU might create a new Roku stick and everything from where their idea lives, when it’s in the original ideation stage to how they’re communicating with the manufacturer, to what feedback they’re getting from customers and other pieces all happens in pre.
Ray: Exactly and that’s, and that’s the difference is that, you know, by doing this the way we’ve architected our software, it brings everybody in the company that touches the product through all of those phases and those life cycles together on one common platform. So they really have a, this product 360 view, um, and they can collaborate, you know, much, much more readily and easily in the past.
That information was siloed and all these other business systems. And, and, you know, I talk about that slinky effect. If you have to hop from business system to business system, you’ve got inherent latency and lag.
Andrew: me from software to software there’s so, so rate, you’re putting an idea in my head as we’re doing this. Yeah. Before we got, started, we were talking about a sauna, obviously general purpose project management. You’re focused on physical products. Do you think that project management software for specific industries is a category that’s worth looking into like, are there other, other podcasters, obviously podcasting being a smaller industry, but podcasters who are booking guests who needs, uh, who need project management software that’s specific to them.
We’re using sales software. W should it be something that’s more specific to us? Do you think that in the book industry, that somebody who’s taking a book from a Google doc to Amazon needs their own project management software, do you think that this is a type of category that’s worth pursuing? I see you smiling.
Tell me what you think.
Ray: Well, you mentioned a book project. One of our customers happens to be Cengage, which, um, they use propel to actually, um, go through that creative process for college textbooks and, um, So, you know, the way textbooks have changed from written paper form to ebook or online, um, you know, you might have, uh, maybe a book on entrepreneurship and you want a chapter written by Reid Hoffman and mark Benioff and, and, you know, bill gates, each one of those are like individual little mini projects.
That have to come together that get assembled into this ultimate book that gets launched. But you know, that also has to go through change and edit and evolve. You know, if you’re telling the story of, of mark Benioff and Salesforce 15 years ago, he would want to tell that story differently today and what he’s learned.
So yes, that project manager, you know, it’s, it’s more than project management. So. It’s all the other information that goes along with it. And then the unstructured collaboration, like what you and I might do using slack to chat with each
Andrew: Right.
Ray: but bringing that in context. So those processes, so the unstructured conversations that you and I have, and then the structured process of the product itself, all getting melded together.
And we going back to our. Point on if you don’t do it that way, people have to work in unstructured ad hoc. You and I just met each other for the first time before this, but we shared some notes. We collaborated. You know, if we had this journey in six months, we’d talked different, you know, talking a different way.
We would structure our context in our relationship through this, this whole life cycle of, of Andrew and Ray on telling the story different. And so we carry that thread, you know, for the whole product and the whole product life cycle so that you never lose the context.
Andrew: you’re saying all this happens in propel. It’s not just someone who makes a new phone or a new Roku’s like stick. It’s also for publishers who need to collaborate and get that, get something going, going from a Google doc to physical product, which is. All right. Fair enough. I do think that there’s something here that goes, that I could take away from the propel story and bring to other businesses.
But may I see a couple of things? Number one, Ray is all these, all these old software businesses at, I see them the way the gardeners, uh, saw your business, which is some point someone’s going to change it. Maybe it doesn’t have to happen at some point in the future. Maybe we need more disruptors like you for, for these older businesses that are less sexy, that we’re not paying as much attention to number one.
And number two, maybe there is more room for these specialty apps. All right. I should talk about my sponsor. Yeah. Jump in.
Ray: let me, let me add one or two more things here. Um, you know, you talk about industry verticals or books or other things. So we have really taken a focus on medical device, consumer packaged goods, you know, companies like swell, water bottles, Vizio TVs, Roku sticks, those kinds of things. Um, and, uh, so.
Medical device and CPG and you know, the, the super cool thing. Just one quick example, like a medical device, when you change the way you’re doing things, you can get everybody in the company to use the system, including the CEO. So, one very quick example. Andrew is I got to speak with a small company down in Southern California.
Um, they are making a home dialysis machine. That will be launched next year. And so it’s a medical device has to go through design concept, has to go through the manufacturing. They’ve got to get the supply chain going. They have to go through the FDA certification and bring that product to market. Well, there are about 50, 75 people.
Everybody in the company uses propel every day, including the CEO. And there they’re telling me that we’re helping them take money. Out of their development cycle and getting that product to market. And so when you look at it and it’s a machine that looks like a smaller than a, a tiny home fridge, But they’re going to put a home dialysis machine next to a patient’s beds to be able to do dialysis seven days a week, like a C-PAP monitor while you’re sleeping versus the one or two days that somebody would go in to a dialysis clinic to, you know, flush their kidneys.
So, yeah. About a third of our customers are medical device companies. So we know that we’re helping them propel their innovation in and bring products out to market faster. So, um, that’s probably the, one of the most cool things for me as a CEO, knowing from a mission purpose side that we’re helping, you know, get better patient outcomes, uh, and increase the, you know, what medical devices and the advances there are, are bringing them.
Andrew: All right. I want to ask you about your revenue. I want to ask you about the flag behind you, but first, um, I usually do an ad here for HostGator, but I should say I just talked right to. To my new contacted HostGator, uh, just got back from maternity leave. I said, so how we doing where the numbers, she goes, actually, Andrew, you’re doing really well.
You had an especially strong August. August is when I started talking to my guests about ideas they’d have for what they would publish on HostGator. So that, that took off. They said, overall, you’re doing really well. So, you know, instead of doing an ad for HostGator, I’m just going to say thank you to everyone.
Who’s been listening. Who’s used my URL to go set up a new website on HostGator. Thank you. Those of you who are interested. It’s hostgator.com/mixergy. When use that URL, I get credit. So Kim’s very happy with the work that we’re doing here. And also you get the lowest price that they have, and frankly, the prices are already low their services.
Great. So, uh, I’m happy that you’re using it. And let me know if you are or not. I always want to hear feedback. Um, andrew@mixergy.com. That’s my personal email. And thank You for using hostgator.com/mixergy. Right? What is the revenue? How, how far down.
Ray: You know, we just closed our series C financing of $20 million. Um, on top of that, we’ve raised 48 million to date. Um, so we don’t publicly disclose our, our revenue. Uh, I’ll say that, you know, in our category we grew even, you know, with a tough COVID year. We grew close to 70% year over year, last year
Andrew: Eight figures like over 10 million though, right?
Ray: oh yeah.
Andrew: Can we say that? Okay.
Ray: absolutely. And, and we, in our category, you know, our competitors are growing at about 15%. So we’re growing, you know, at five to six X faster than our competition right now. Um, and, uh, as far as, uh, as far as what we see for continued growth, we see that as, as long-term sustained.
Andrew: Why did COVID change your business at all? I know you told our producer that that was a change. I don’t, I don’t see.
Ray: Well, it was, it was a tale of two tails. Um, you know, on that side, uh, it was for three to four months, you know, in, in the early side, say from March to July, August timeframe, everybody was scrambling to just go, what happened? What do we need to do?
Andrew: March, 2020, because just to put it in perspective, you get into a new office, 90 people, Santa Clara, 90 people in the office in January, and then March we in the bay area had shut down. So you close your office And then.
that’s what you’re talking about. Like where are we going? What’s going on here in the world.
What’s going on with our clients, revenue went down, customers, everything.
Ray: Actually revenue. We had very little, um, revenue impact, very low churn in, in SAS, but our, it was really the new buying customers that tap the brakes for about four months. And then at the tail end of the year, we started, started to see an acceleration and we still are seeing that tailwind behind us now, um, with probably more and more companies going.
Boy, we need to need to think differently because we are working remote. They need this new cloud-based system and solution.
Andrew: on premises was literally on-premise. You couldn’t use the software from home.
Ray: Right? A lot
Andrew: That’s true.
Ray: That’s absolutely true.
Andrew: So if you had an, if you had a new office in a new city, you’d have to go and set up a server. And new desktop software there. Oh, wow. I see. So that’s why COVID impacted you. And also you mentioned that there’s more e-commerce being done.
Does that impact your business? I wouldn’t think it would. It does.
Ray: Well more and more people are, are now launching products faster and they’re trying to fill, they know they can increase their portfolio of skews. So they’re looking for ways in software to get everybody to work together, to put more product out faster. In these e-commerce sites that they can sell. What
Andrew: Ah, because people are now shopping differently. They’re open to different ideas of What
to buy. And so okay. So there’s more room for more creativity.
Ray: So manufacturers are launching more products or even variants of existing products that it, it may look like a brand new product that’s just slightly tweaked, but it’s allowing them that the barrier of entry for them to launch more products has dropped because of the increase in e-commerce.
And so we’re helping fuel that engine from that concept, the customer to push more product through e-commerce channels.
Andrew: All right. The flag behind you.
Ray: Yeah. Yeah. The American flag behind me. Um, both my, my father and my uncle were, um, uh, uh, both in the air force during the Korean war. And so, um, both. Uh, both were honored along the way. My dad, uh, got a bronze star, so, uh, uh, for, for what they did during the Korean war. And, um, so when they both passed, uh, you know, the air force honored them.
And so that’s, that’s, uh, you know, a memory of, of both my, my uncle and my father for their service. Back at that time,
Andrew: What is a bronze star
Ray: a bronze star is a bronze stars. Uh, it is a medal of honor in his particular case, he was a. I in a, in an island, north of North Korea, and he was listening to, um, Chinese pilots that were fighting for the north Koreans. And he had learned Mandarin and Cantonese Chinese at Yale, both, both, both my uncle and he, and they were able to understand.
Was being spoken and help our, you know, the south Koreans and the Americans understand just what these, what these Chinese pilots were going to do and where their targets were. So they, um, by doing their work there, you know, they saved, you know, tens of thousands of lives over about a two year period by being in this tiny little remote island, just north of North Korea.
And there’s, there’s been some videos, things about what they did. It was, it was classified for many years, but. They received, he received the bronze star for saving, you know, tens of thousands of lives by the, by being up in that little.
Andrew: He seems like an extraordinary man
Ray: He was,
Andrew: like with you?
Ray: um, you know, he was an inspiration of, uh, of innovation as well. So, uh, he was, he had learned early radar and radio equipment. And so he tried a lot of different companies while I was growing up, um, as well. And, uh, along the way, I think. That probably put the point in, in, in my life where I was able to, um, not have a fear of risk and being a risk taker.
So from that perspective, um, you know, he, uh, he enabled me to be an honorable.
Andrew: He was an entrepreneur with him. From what I understand, the two of you started a business when you were an early teenager, like 14.
Ray: Yeah. Um, I had, uh, uh, one of my other uncles had, uh, you know, show me about stamp collecting. And, um, so we created a company that basically made plaques of stamps that were, um, commemorating different events. And we would take them to stamp and coin shows and sell them and so forth. So learn a little bit about how to manufacture things and how to sell things and,
Andrew: Oh, you had the manufactured, you weren’t just buying plaques and.
attaching the stamps.
Ray: No, we had to make the copy of the, of the plaque itself and then the wood that it was on. And, and so we had woodworkers and, and people that we had supplier suppliers that we had to buy things from. So, you know, learn about the manufacturing process through that.
Andrew: And standing up in front of a room full of strangers, telling them about your products selling, how was that.
Ray: You know, it was, it was great. I mean, I was young, I was 14 and 15, so, you know, it was the older adults were like, well, kids entrepreneurial. So, uh, it helped, it helped shape me, build me and, and take me through my, my schooling side that I was always, you know, one of the leaders in everything I did built, they’ll just tremendous confidence.
I think at the end of.
Andrew: well, you’ve done great with propel. Where’s it going? What’s next for it?
Ray: You know, we’re, we’re taking this, uh, this money, this series C round of financing and expanding our sales and marketing team, you know, to match the growth of what we’re seeing in the market so that we can become the dominant global player. Um, there’s a lot of big companies that, you know, we’re competing with, but we’re
Andrew: the biggest.
Ray: Uh, Siemens SAP, Oracle Deso PTC. There are five very large companies that, you know, have in this category. But our, um, our space that we’re taking on, um, we feel like we’ve got a good shot at becoming a, uh, a unicorn type company over the next three to five years based on what we see in our growth. Um, and then we’re focusing heavily on, on some new innovation and, um, continuing to make it more simple for the modern workforce and driving more and more adoption.
So as I was saying, You know, everybody in the company is active with the product from concept to customer. So us being that system that they always trust count on about the product and then how are they going to do, um, do work through analytics and, um, uh, and then analyze their product success. Those are some of the things that you’re going to see us coming out within the next 6, 12, 18 months to.
Andrew: All right. The website is propel. PLM PLM stands for,
Ray: Product lifecycle management.
Andrew: um, it’s agile. Still agile is still in the business, right
Ray: Agile was acquired by Oracle
Andrew: Yeah. For half a billion dollars, roughly a little under that.
Ray: Exactly. And so that product old legacy product is, uh, still being charged for maintenance, but not being innovated on. So again, that’s one of the other reasons we, you know, built propel and, um, you know, they’re, they’re in the category, but it’s, they’re solving very different problems than what we did, you know, uh, back in the day.
So, um, it was great, you know, to build that company. And, uh, it was a springboard for what we’re doing today.
Andrew: Yeah, it looks like the propel is going to be. Well, congratulations. Uh, thanks for being on here and telling your story and look at this without the iPad. I did. Well, maybe I don’t need that now. I love the iPad. That’s a love affair.
Ray: agreed. Agreed. Can’t can’t can’t leave. Can’t leave home without it. Except you did.
Andrew: I did. And I survived.
Ray: Right.
Andrew: Thanks. Ray. Thanks everyone.