Laying the foundation for rapid growth with Oyster’s Tony Jamous
Laying the foundation for rapid growth with Oyster’s Tony Jamous
Tony Jamous (00:01):
The company growth is off charts. We have grown more than 20 X last year, went from zero to double-digit ARR in less than 12 months.
Peep Laja (00:16):
I'm Peep Laja. I don't do fluff. I don't do filler. I don't do emojis. What I do is study winners in B2B SaaS because I want to know how much is strategy, how much is luck, how do they win? This week, Tony Jamous, founder and CEO of OysterHR, a platform for hiring and managing a distributed team of remote workers founded just two years ago. Oyster has experienced hyper growth, raising both series A and series B funding in 2021 for a combined total of over $70 million. Oyster now employs over 300 team members in 50 countries, and they continue to expand. In this episode, we discuss how Oyster prepared to scale quickly when met with high demand and why allowing a strong mission oriented narrative to permeate all parts of the company has been key to their success. Let's get into it.
Tony Jamous (01:05):
The opportunity I saw was that hiring somebody in another country was extremely challenging. It was like climbing Mount Everest; was risky, was opaque, had set up entities, high lawyer, accountant, parent providers in all these countries. And after you do so, you fail to deliver on a great employee experience. So the opportunity we saw is applying software to make hiring somebody on the other side of the world, as easy as hiring locally and by doing so, drop the barrier to entry dramatically for global hiring and create a new category of global employment that actually were coining global employment platforms.
Peep Laja (01:53):
When you set out to solve this problem, offer payroll services around the globe. Did you start with select countries or did you start with the whole world in mind from the get go?
Tony Jamous (02:03):
Our customers come to us because they are tapping into the global talent pool. They are here to hire the best talent, no matter where they are. So it didn't make sense for us to start by focusing on a narrow number of countries, because one of the buyer purchasing criteria was, "I want a platform that covers the whole world and not worry about not being able to hire that person". That's why when we started the business, we built what we call hybrid infrastructure, where we had to work with local partners in countries where we didn't have our own infrastructure and gradually evolve and build our own infrastructure over time.
Tony Jamous (02:45):
And we also had to work with partners because when I started the company in January 2020, very quickly the world went into lockdown and you couldn't even talk to governments in many countries. They were just, you know guys, well, you have to wait until we figure out when we're going to reopen. And so we had to really fall back on this partner network that we've created around the world and eventually over time we moved to our own infrastructure.
Peep Laja (03:09):
Yeah. So you started the company in January, a few months later you raised your seed round of about $4 million, was your product already out in the market at that time?
Tony Jamous (03:20):
No, we raised our seed round four weeks after we started the company in February actually and we announced it a bit later. And all we had was an investment memo, an 11 long page document that I spent the last few months of 2019 writing after talking to industry experts, after talking to customers, after talking to competitors and that's all we had. But then when the world went into lockdown, we realized we had to move really, really fast. We started by building this employment infrastructure and 180 countries started quoting. So we started building the minimum viable experience that makes global hiring as easy as local hiring. And we build a fully distributed team, at the end of 2020 we were 20 people, last year we ended up at 350 people. So we moved really, really fast in building the organization. And in just few months after we were in business, we achieved product market fit because the demand for what we're trying to achieve, global hiring, was actually so high that we very quickly were able to find a product market fit.
Peep Laja (04:33):
The fast eat the slow, speed is a competitive advantage. I wasted many huge opportunities by being too slow and hesitant. I wasted some money once by being too hasty. My biggest wins have come from taking swift decisive, even radical action. A faster organization has more people deciding and taking action and fewer people briefing each other, reporting, seeking approvals and sitting in a myriad of unproductive meetings.
Peep Laja (05:06):
Ways to make your organization faster: one, reduce the need for meetings. This is not the same as no meetings, set clear rules and guidelines for how decision making should happen. Two, one way to cut meetings is not to have meetings for updates and information sharing, that can happen asynchronously. Three, fewer decision makers in each meeting. When David Sacks was at PayPal, he enforced an anti-meeting culture where any meeting that included more than three four people was deemed suspect and subject to immediate adjournment. Four, make information accessible. Anyone should have access to any information and stats in real time. Any question that needs to be answered to make a decision, anyone should be able to just look it up. Five, stop making your top people bottlenecks. Top leaders should focus on fewer, more mission critical decisions, all other decisions should be delegated. Six, drive closed loop accountability. Everyone on a team must be clear about what needs to be done by whom, when, why. Disciplined follow-up is needed to review actions and results.
Peep Laja (06:14):
Speed of execution can continue to give you an edge over competitors long into your company's lifetime. Here's Johnny Boufarhat, founder and CEO of Hopin, with some insights he has gained from their three years of lighting fast growth.
Johnny Boufarhat (06:27):
I think anyone who says that funding just makes you a success, I would say it adds a lot of pressure and it makes you have to move faster, which adds to your success. I think speed is the number one important thing as a company, and speed of execution and quality of execution is the most important thing. And so money allows you to do that with fundraising. So our product features, instead of implementing them in three months, our goals were to implement them in one month because we had enough to hire good people and start spreading out. But then it brings organizational structures that need to change, cause as you know, you can't throw 500 people to fix one light bulb, it won't change the speed of the light bulb, it's about setting up those organizations. We need people to be proactive, when you're moving this fast, there's a lot of holes in the process and you need someone who's proactive.
Peep Laja (07:12):
Usually in the early days companies in the product market fit, finding the marketing and sales aspect is the hardest part. So for you guys, it was like, suddenly everybody wanted what you had to offer. Is that how it was, more or less?
Tony Jamous (07:28):
It was exactly that. And then that opened up a whole new problem that typical company don't go through, which is operational scalability. How can you, every week, every month, double your ability to employ people in more and more new countries. I mean the level of complexities, I mean, if you thought global payment was complex, think about global employment. Global employment is... it has payment in it because you have to pay people, but it has also payroll, you have to pay them accurately. But it has global compliance. You have to find the right level of contracts, employment contracts that is fair, that is safe for these employees. And there's all the benefits. And every country is different. You know, in France, you got to give them a restaurant ticket. Where in UK, you better give them a dental insurance and so on and so forth. So the complexity that we're solving with software is very, very high. And one of the reason why this category, global implement platform is so valuable.
Peep Laja (08:24):
Tell me more about that, internally those recruitment processes that you had to quickly set up. So hiring, finding talent, the whole vetting process is a pain for a lot of companies. So how did you guys solve it? What did you do to hire so many people so fast?
Tony Jamous (08:41):
Yeah. So Oyster is a hiring machine. I'm probably one of the only CEOs in technology that I'm telling my team to hire more slowly. We are getting, we are receiving over 10,000 application a month. For a company that is two years old, that's unprecedented. So we've built this amazing employee brand that is directly connected to our identity as mission driven, human centric, diverse and globally distributed organization. But we've also made it known in the market. We through social media, we very often share how is it like to work here. And we publicly open our approach to work. If you go to our website, you see how we work together, document how we adopt is asynchronous way of collaboration and communication. How do we care about people's wellbeing? How do we create an environment that people feel comfortable and safe to do an amazing work? That's what people want. That's the new way of working. We are building more than a company. We're building a movement around advancing what work should be. And that's why we have such an amazing employer brand.
Peep Laja (10:07):
The bigger an organization gets, the more important culture becomes. Culture is easy when it's just a founder senior circle. Once you get bigger, it gets so much harder yet culture is the effectiveness multiplier for all strategy and execution. Perks are not culture, perks are nice, but no replacement for what kind of behavior and output is being tolerated, set standards for kindness and human interaction in general and level of work that is accepted. Minimum acceptable standard for work is the most important part of workplace culture. Culture can also affect the way your business is represented. If your employees are proud of their company and feel purposeful in their work, they'll say so loudly. That becomes part of your brand's reputation, as Alfred Lin partner at Sequoia Capital and former CEO of Zappos explains.
Alfred Lin (10:56):
Culture and brand, they are two sides of the same coin. So culture, like the principles and the beliefs that you have inside the company that you want people to be aligned with long term. And whatever happens inside the company eventually comes out, you can't hold it in. And brand is really the promise outside the company that everyone identifies with. And so I think having a clear mission and making sure that you know that mission, and making sure that mission comes through the company is probably the most important thing you can do for both culture and values. And then the second thing you need to know is that your brand, the way people think about you as a company is often decided by your... I mean your brand evangelists are your employees. See why we have culture? We often think that companies that hire employees or people that are deeply passionate create companies that customers are really, really passionate about. And those are the companies that have strong brands.
Peep Laja (11:51):
When I look at your marketing narrative, the stories that you guys put out, using your social media and other channels, which is of course all about the world going remote, the top 1% talent is not in the city where you happen to be, but that narrative is not too different from the story your competitors are telling. Is the market growing so much faster than the business that you can still push the category as opposed to pushing your business? Or how do you reconcile those two things?
Tony Jamous (12:22):
Our mission to make the world a more equal place is not... it's not our mission, it's the world mission. So we're very happy when other competitors in our space adopt a similar narrative to Oyster. We believe this is a mission win from a B2B marketing standpoint and B2B SaaS standpoint. Obviously there is a more specific reason why a customer would pick a vendor A versus a vendor B, but overall from a category narrative standpoint, everybody is welcome to share our mission.
Peep Laja (12:55):
So if I'm a B2B SaaS CEO and I'm looking for a solution like Oyster, and so I'm looking at Oyster, I'm looking at Deel and maybe Remote.com and other players. How are you trying to win the business over? Are you actively positioning yourself differently from the other players in the market?
Tony Jamous (13:13):
If you think about it, what are our customer wants and we provide them that is very unique to Oyster is a combination of two things. One, is the scale for the HR team sitting in headquarters and hiring in five, 10 different countries. And that obviously we use software to do so, you can achieve that with few clicks on our website. Actually last year, we were able to break the record of less than six hours from the moment the HR person submitted the hire to the moment the employee is ready to work, and we expect this to go down to one hour this year. The second dimension of value is the personalization of the employment experience to the local employee in that market. We are obsessed by being the best legal employer and we are obsessed by enabling our customers to be the best functional employer, and essentially increasing their retention and their acquisition rates of employees. And that's how we think about it. We think about it as this is not a compliance and a payroll only solution. This is an employee retention platform.
Peep Laja (14:25):
Typically, what happens in emerging categories is that typically who gets the biggest first remains the category king for a long time, maybe decades. Is that race to become as big as possible, as fast as possible, something you guys actively think about?
Tony Jamous (14:44):
Yeah, absolutely. I mean, we want to be a market share leader, now what does it mean? How do we measure our progress toward that? We measure our progress toward that if through our win rates, are we winning more than our share of the market on competitive deals? And we also measure that on our awareness, is our awareness increasing in line with the expectation? And so these are the kind of two variables, essentially one variable is conversion. So one is volume and one is essentially conversion rate. So how do you maximize both of these variables?
Peep Laja (15:26):
And so what are the strategic plays, like what are you betting on, to win that competition here?
Tony Jamous (15:32):
The biggest bet we're making is actually, is to win the customer hearts and minds. So in a category that is so nascent, it is less about feature by feature differentiation because with enough money and enough capital, anybody can and build any feature, right? But it's really about telling a story that connects deeply with the heart and mind of our buyer persona and it's definitely backed by the best features and the most relevant features without the platform. But as the first and foremost is understanding why we're here and how do we help these customers. And we are a mission driven company before being a software company, right? We're the only B Corp benefit corporation on the pack, it goes a long way in enabling us to infuse our mission into how we run our business and how we create value for our customer and their employees.
Peep Laja (16:35):
Having a clear mission for your business can be a powerful rallying call to your audiences. It can allow subsequent decisions and actions to be judged against the overall strategic intention. It can communicate to your team why you really exist and what business you're in. Purpose in workplace matters for talent attraction, productivity, and retention. Your mission can also inform your strategic narrative, your strategic choices. I think of the mission as the infinite game. Sure, sometimes mission statements can feel lame, but lame mission statements come from actually being a lame company or low ambition or not thinking about it seriously. Take some time to write a paragraph about your mission. Don't worry about elegance, focus on substance. Your mission is worth thinking about both internally and publicly.
Peep Laja (17:21):
One company whose mission permeates every decision they make is outdoor clothing retailer, Patagonia. Mission is so important to their identity as a company that they even have a dedicated director of philosophy, Vincent Stanley. Here he is explaining his firsthand experience of the impact of Patagonia's mission statements.
Vincent Stanley (17:39):
At the end of 2018, we simplified our mission statement to say, we're in business to save our home planet, okay. And this drove me up the wall when we changed that, I thought, oh my gosh, it took 27 years for the company. And the first mission statement, build the best product cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis. I was against that when we adopted it 27 years ago, cause I thought, oh mission statements are such bullshit. Most mission statements use words like strive or foster. And so they give you an out, you say, oh, we're going to try to do this. And if we don't, well we'll keep trying. But the original mission statement became something that we really inhabited it, became less aspirational.
Vincent Stanley (18:26):
So when Yvon started to talk about we're in business to save the home planet, I said, no, we're not. But what happened is everybody has taken this very seriously and they start to look at their activities, what they do, and this is within the company, they look at their jobs and say, how does this fit into the mission? So we've had this experience repeatedly where aspirational language becomes directional for folks.
Peep Laja (18:55):
What are you guys doing in terms of marketing and brand building specifically to win the market?
Tony Jamous (19:04):
Yeah. First we have to be credible to talk to HR innovators, to talk to future of work innovators. So, and secondly, we have to amplify our credibility, right? But first we have to be credible, which mean that we need ourself to be the gold standard of distributed work. And we are becoming just to give you some data, we got, we are getting 10,000 applications a month terms of our employee brand. Our... we have 60% women in the company. I have gender equality on my leadership team. We have 95% engagement rate in the company.
Tony Jamous (19:43):
So all these data that our buyer persona cares deeply about, we are off chart. Our goal here is to prove to them that being distributed is not only better for business, but it's also better for people and better for the planet. And we take that, not only we take that narrative to the market, obviously we don't take it in a kind of direct way, it's more subtle. We essentially provide a lot of tools and content and events that enable us to help to create a better future of work that we believe is distributed future of work.
Peep Laja (20:23):
So are you guys throwing a bunch of events or what are the specific outlets of this?
Tony Jamous (20:29):
Yeah, so definitely we have, we had a number of events last year and we're going to do more this year around the future of work and around the recruitment and emerging economies. These are the two events we've done last year. We're going to have a big present at the HR transform event, where HR innovators go and also through tons of thought leadership that is targeted towards helping these HR executives become better at being distributed. Actually we have our Oyster academy program, teaching HR professionals to deploy their remote work policies in their training, in-house. But also we train the people as we train employees on becoming better remote workers. That's an open source, free content and training resource that we provide for our customers.
Peep Laja (21:25):
You guys raised around 50 million in series B only four months after raising your series A and meanwhile, your company value grew six times. What happened in that short time period to drive such fast growth?
Tony Jamous (21:42):
The company growth is off chart. I mean, we have grown more than 20 X last year, went from zero to double-digit ARR in less than 12 months. I know one company did that, which is Google, they went from one million to a double-digit ARR in their second year of operation. So we're definitely off charts for many, many VCs. And obviously you can understand why the demand in this market is...the world need this, right? So we're fortunate to be in a position where the demand has been expanded massively in the last two years. I mean, this category in general has been very attractive for investors because if you're a VC, everyone of your portfolio company is today struggling with hiring and/or struggling with their remote work practices. One of the reason why this category is exciting for investors is that you're going to have a number of very large companies that's going to coexist in that market because of the vast market size and the various way you can slice and dice that market.
Peep Laja (23:01):
Go where the money is. There are SaaS companies with mediocre marketing, completely undifferentiated me too products, yet have managed to get to a significant size, making a ton of money. Without fail, they're all in large markets with huge demand like marketing automation. Why fight an uphill battle when we know preexisting demand is the biggest growth driver. If your product or service does not cater to existing demand, you just need to work so much harder.
Peep Laja (23:32):
Your timing obviously was impeccable and still there were others who did not succeed as well when you did. So looking back, what are the things that you think you did really well as a company? Where you out executed other players?
Tony Jamous (23:52):
Number one is the best team. We built a series F team for a series B company. Everybody on my exec team has been hired through a thoughtful executive search process that took me more than six months to a year. We needed people that are mission aligned, that have experienced hyper growth, that are fit for purpose. I have my head of product, was a lawyer before and she worked at Cardata replacing lawyers with software. I have my general counsel, she worked at TriNet taking employment compliance into and through software. We have head of marketing, from Buffer who created its iconic remote work brand. I have Ellen our president, she spent 10 years at Facebook scaling their operation team to 10,000 people. I have Mark our chief workplace officer or chief people officer, he was the Envision's chief people officer, which was remote company before remote were a thing. So everybody is like really hand picked for the specific role they do.
Tony Jamous (24:49):
Secondly, is the best culture as we discussed earlier. Our numbers of culture are off chart in terms of our employee brand, in terms of our diversity data or engagement data, and why are we doing that? Because we want to be credible setting into HR innovators and they care about these things. This is like Salesforce.com strategy. They had to be the best in B2B sales in order to be credible, to sell you the best CRM software. This is the same as HubSpot. You had to be the best at inbound marketing in order to sell you the best inbound marketing platform. While Oyster is the best at being human centric, mission driven, diverse, and we're selling you a global employment platform. So best team and best culture.
Tony Jamous (25:31):
Secondly, is best software because in my previous business, my previous company, we built a global communication platform that did exactly the same for the telecom market, where we put an API in front of a globally fragmented and highly regulated market and we grew that business from digital 100 million in the first five years to the public mid 2016, it got acquired last year by Ericson for $6.5 billion.
Tony Jamous (25:57):
So we know how to build software that can deliver hyper scale. And last but not least, is the best operation because what we, I mean, what we do is complex, right? We're taking 180 countries and that requires an elegant orchestration between an employment infrastructure in 180 countries, a scalable software, but also a knowledge, and employment and compliance knowledge that has to integrate into a software. So best software, a best operation, best team, best culture is what you've done and continue to do.
Peep Laja (26:34):
So what are three key strategies that have proven successful for Oyster? One, they saw an opening in the market and executed very fast on the opportunity.
Tony Jamous (26:43):
The world went into lockdown. We realized we had to move really, really fast. So we start building the minimum viable experience that makes global hiring as easy as local hiring and we built a fully distributed team. At the end of 2020, we were 20 people. Last year, we ended up at 350 people so we're moving fast in building the organization.
Peep Laja (27:07):
Two, they practice what they preach, reinforcing the narrative they sell by focusing on their team and company culture.
Tony Jamous (27:14):
But it's really about telling a story that connects deeply with the heart and mind of our buyer persona. First, we have to be credible to talk to HR innovators, to talk to future of work innovators. We need ourself to be the gold standard of distributed work.
Peep Laja (27:34):
Three. They focused on hiring an all-star team.
Tony Jamous (27:37):
We built a series F team for a series B company. Everybody on my exec team has been hired through a thoughtful executive search process that took me more than six months to a year.
Peep Laja (27:49):
One last takeaway from Tony.
Tony Jamous (27:51):
Our goal here is to prove to them that being distributed is not only better for business, but it's also better for people and better for the planet.
Peep Laja (28:00):
And that's how you win. I'm Peep Laja. For more tips on how to win, follow me on LinkedIn or Twitter. Thanks for listening.
