Andrew Alex's entrepreneurial journey, including his pivot from a recruitment agency to product launch, his decision to bootstrap.
Andrew Alex's entrepreneurial journey, including his pivot from a recruitment agency to product launch, his decision to bootstrap instead of seeking VC funding, and his strategies for product love marketing and value-based pricing to achieve over $40M in revenue.
not waste the time on non-important things. Not pursuing those ideas who were not like worth it. Go for like a really like big market and big ideas. >> All righty, hello everyone and welcome to the Deal Maker Show. So, today we have a We have an awesome founder. You know, we have an awesome founder that you know, has done it all. But, today you know, ultimately the beauty is that he's more of the bootstrapping side of things. You know, more than the founders that we've had that are like, you know, raising crazy amounts of money and things like that. He took another route and I think it's quite inspiring and we're going to be talking about all the stuff that they're rolling out, how they're like turning angry customers into buy more products. like like things like that. I mean, you It's unbelievable. So, quite the story. So, brace yourself for an inspiring conversation ahead of us.
So, without further ado, let's welcome our guest today, Andrew Alex. Welcome to the show. >> Thanks, Alejandro, for having me. >> So, born you in Ukraine and in a small city near Kiev. Give us a walk through memory lane, Andrew. How was life growing up for you? >> Oh, like my my early life wasn't so fun. I would say like, you know, like when you were like raised in the middle of like third world country. Um I love the the my my country, etc. But, you know, like the the the childhood wasn't so fun. You know, like living in like small city, there's like nothing to do. Um So, so yeah, like the the the most fun thing was like in in in the bigger city when I moved to the capital of of Kiev. Like the the life there is much more fun. >> I mean, you were there for about 10 years. Um and but one you were having quite the fun because you even decided to dropped out of
university. So So why did you drop out of university? What was happening? >> Well, like I I I made like my way like at my second grade. I was working at the postal officer packing packages for people and delivering like the parcels door to door. It was fun thing like I I love to like put my hand headsets on like listening to music just like when I was like biking through the city. But at the same time, you know, like it's it's not something that you would do. And I ended up like building my career in marketing first. So I I found it more interesting to work for like a marketing agency than just like listen to 60-years-old guys in the university. Unfortunately, the the education in Ukraine is like you have probably like two, three great universities and then the rest it's just like post-Soviet Union stuff. Maybe some good mass basics and some other, but majority of the education in
like non-tech field sucks. >> Well, product and marketing ended up being the focus as part of your career before you got started with with building your own stuff. So talk to us out of all things, what caught your attention, you know, when it came to product marketing? How do you think it has really served you well, you know, later on? >> Yeah, I started my career in advertisement agency. We were like doing ads for like big brands like MasterCard, um MasterCard and others. Um but, you know, I needed some more impact on the product itself. It's cool to make a marketing, but if you're like doing marketing for the product that people don't want, you cannot sell it. Yeah, like you you you can sell to some percentage of that, but I saw that much better to make the product that people will love, and then you don't need to really like do marketing. You just like need to tell them
about the product, and then naturally will they will buy it. And that's like the idea that I'm still um having in my mind and I'm I'm I'm I'm still building all of the new products without the need to really sell them, just like tell people about that, tell about the value prop, and then they will naturally buy it. >> So, here you are, you know, you are in in the corporate world, you know, you are uh making a living product marketing, as you were saying. How does all of that transition towards you becoming an entrepreneur? >> I was working for a company um like I was doing the the marketing stuff, then I got bored, and I transitioned to the um company called Conductor. We were like doing um a lot of a platform for search engine optimization for enterprises. It was a lot of fun, you know, like it was my first time when I traveled to New York uh US, you know, I was like 21-year
year-old kill kid dreaming about the US. The the first time I visited New York, it uh all of those skyscrapers, like the this period of entrepreneurship, all of those startups, uh founders inspired me. So, I ended up being uh switched to to to B2C experience a little bit. So, I was running like the uh the after the the the VPN apps, and for more than like 80 million users, so we were like doing a lot of like mobile apps. That was totally different experience from B2B, where in B2B you do like the check sizes of like 100k, 500k, and the deals moving slowly, like the product is developing slowly, but on their B2C side, the it's totally different. Things that when you can run a lot of tests, uh see the metrics, make a decision based on the data, so the dis- the experience is is totally like vice versa. So, I had like the the best of two worlds, like working is like big customers and working
with like SMBs and just like consumers. Um and it helped me to build like the company in into the uh future. Um in 2020, it was a wild run of 0% interest rate, as you can uh remember, everybody's was raising at the huge valuations, uh crazy multipliers of like 100x, 150x. Uh so, the money was not a thing at this time. Uh and that resulted in the the booming of hiring, etc., and I ended up with like starting the recruitment agency. Everybody was wanted to hire talents, so essentially when everybody's digging for for gold, you need to sell show- showers. Um and uh yeah, and that was like fun for some period, uh but then I got a little bit bored and wanted to launch products. Uh and we ended up making a uh tool for subscription management for companies. That was like the uh the the the thing that frustrated me in the previous work, you know, like we had a lot of people leaving the companies
and we still were like paying for tools that they were like having for like years, you know, like literally like not months, but years. Um so yeah, we made like the tool. Uh It was quite successful. Like we we tested it out with a small group of customers. Um Everybody was like raising at this point. And I don't know. I didn't feel comfortable to really raise some money for that in terms of and I want this product to be successful and to be responsible for myself firstly and prove that I can do something. Um so I was just like financing everything out of my pocket, essentially from the previous business. So previous business was refinancing that for like two for the first like two years, I think. Um and I was gradually wind winding down like the previous business because I didn't have time for that. Um if I had time, it would be growing, but still, you know, like right now like AI is
replacing like most of the employees and recruitment is not the best business to be right now. Maybe only recruitment of the executive staff. I think that in executive staff, you can make good money, like huge commissions, etc. Um but so so it was like a good decision back then. Um so yeah, like for the first 2 years it was financed from the previous business. And then we started ending up that like listening to customers, solving their problems, and we um, we heard that a lot of our customers, they are like overpaying for not only subscription, but only like for cloud, and we ended up like making a FinOps platform for um, customers to save money on the cloud, on major hyperscalers, like GCP, AWS, Azure, and all other clouds, as well as like Alibaba Cloud, uh, Huawei, um, different, uh, local storages, etc. >> So, then obviously, Spendbase, you know, it's what the it ended up
really being a quite the hit, you know, for you as as a founder. I guess for the people that are listening, you know, to to really get it, what ended up being Spendbase, you know, what's the business model? How do you guys make money? >> Oh, that's that's that's a great question. Um, so, I was thinking like what I'm you know, like there's like a famous quote of like tell me one thing that everybody is wrong and you are right, and then I saw that everybody's was having this like SaaS pricing uh, in their products, like delivering like zero value, like you just like signing up for the product that is not delivering you any kind of value for the year. Um, nobody from like your customer success team like reaching out to customers, but at at some point, you know, like they they're forgetting about their subscription, and for some reason they renew, etc., and that's how majority of the
companies…