#3: Tatul Ajamyan - Wakie - Y Combinator Alumni Interviews (YC W16)

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What's up guys and gals welcome to the third episode of entrepreneur gains where i interview YC alumni today i'm interviewing Tatul Ajamyan founder of a social media
app called wakey started off by trying to fix a simple problem of waking up in the morning by creating accountability it is now an app where strangers can talk to strangers about any topic they want to talk about they have raised over seven million dollars and the app is being used by millions of people around the world this is a must listen episode for anyone excited about social media startups and i enjoyed it a lot because me and Tatul share the common connection of starting a social media app slash consumer apps uh i hope you guys like it hey man thanks for coming i appreciate it um let's start with uh i wanna i wanna know more about you like one listeners to know more about you so let's start with like who like uh who are you how did you come up with your uh app which that's soaked well and got into YC and stuff yeah let's talk about that yeah uh who am i is a big question uh you i wonder how far i mean in a spiritual way i mean more than uh an entrepreneurial yeah yeah so uh i'm i'm coming from an entrepreneurial family and i started my first company very early when i was 19
and my with with my brother who you know as well who is the co-founder at reiki and uh he was 16 i was 19 we started the first company uh it was a you know web web development agency you know designing websites and all sorts of videos and all that stuff um and basically you know i understood that the world is moving in digital era it
was a long time ago by the way it was 19 and now 2002. um so uh you know and my my brother was this geeky techie guy and i was this uh you know sales guy so i basically i started by exploiting his his brains and using his brain you know selling his
brains his brain power to the world and it was fun uh at some point uh you know i decided to go into uh my my my educational background is finance so i decided to go and see how is it in finance you know because i tried out entrepreneurial path it's great but i thought maybe my my you know the growth would be limited if i didn't uh educate myself so i went uh uh i worked for PWC Price Water Cooper the um consulting company and then i i worked for an investment bank as an m a uh person mergers and acquisitions um and then i returned to and and my my brother he uh worked for the biggest tech company in russia yandex uh i've yeah so they they they bought the first
social network in russia which was kind of linkedin of russia and my bro was the ceo of that company and uh yeah and he worked for for yandex for a couple years and then we we returned to our uh older company together thinking about what could we build next uh so this 10-year like journey was um uh preparing us you know from all sides uh what's the business how you deal with people how you manage and how they managed you and all that stuff it was very interesting and then at some point now he and me sat down and started thinking about ideas we you know we had and by we i mean him is this he's this fontaine of ideas and uh you know he's he said you know he was working in two places and then he was studying at university and he didn't sleep like he was sleeping and there was no order in his sleep so we could wake up late in the evening and start working then um so he was hard way cover and he had this crazy idea what if when when he was getting a call on his mobile it could be a client basically and this was the situation when he would wake up really efficiently yep and he was making some noises with his throat and then he was he started he he answered the phone and start started speaking like like he is at the office for for a couple of hours already uh pretending you know to be awake and he had this crazy idea what if we would uh call each other and wake each other up like a hotel wake
up call but crowdsource okay and we decided to build that so it was just a funny experiment uh we kind of intuitively felt that we need to build an mvp we never knew
the words the the mvp verb work but we decided to to build it's a simple as a simple thing and uh long story short a few weeks like in three weeks we've launched it and told it on one of the one of the events where there were 20 people next day we had 50 uh wake-up calls next day we had 100 next day we had 200 it was doubling every day
wow working only in one city in Moscow yeah and then at some point when we launched it to be available in in russia it started doubling every four hours wow you can imagine exponential yeah exponential growth uh and then you know we understood that and then it's in one morning we wake up and we see that someone took the idea uh translated it into english and launched it in the u.s and we were scared yeah yeah we were very scared because you know we had something that we invented and someone was launching it in the capital of the world in silicon valley so what we did we we really booked tickets and uh we started translating and then in two weeks we launched it uh in in english and the result was uh different from what we've done with what we've seen in russia because we told it to like 200 people and then the next day we saw three alarm clocks and then the next day one and then the next day zero
so it's you know i i uh i heard that launching a product in a different country is like launching a new company yeah but we experienced that in on our own so that's how it started it took us a while to figure out how to make it more interesting for you know different cultures and stuff but eventually uh some you know in some ways we succeed i remember when i checked when i met you and this is about four years ago you had you guys had some of the craziest numbers i've ever heard i remember that where like the amount of calls that were happening every day i remember because i remember we were starting out and you guys were like we were chatting about it and it was insane how many calls were you you were having on like a uh like as a startup and like someone young like you know doing their first or like you know their first startup and like meeting some great people and i was like holy shit what's going on here how many what at the peak of your like you know of uh when like you guys were blowing up what was the number of calls you were having every minute uh oh i i don't know uh actually but there there was this problem uh you know right now wiki is uh uh as a social app for phone calls where you set any topic you want to talk about right and in a few seconds get to have a phone call with an interested person it's it's not about wake-up calls anymore right right yeah but back in the day when it was about wake up calls we had this peak hours you know 7 00 a.m 8 00 a.m like this round hour 7 30 and and those hours we were having huge uh huge number of calls but i i don't remember exactly i think when you were lying yc you guys were already you guys are already like
pivoted or shifted to the model uh we were experimenting yes you were experimenting
so first time we applied when we when we applied first time uh we were a wake-up call and then uh you know we got rejected and uh by the time but by the next time we we were already very cool uh did the pivot come because of the rejection or you guys were already just growing in general like was just natural i i can't say like it's not just you know it's not the reason for the pivot but i think it just you know adds up uh this just adds up in the bucket and then you you understand that there's too many arguments to pubert and got it uh was it difficult for you to get into yc considering you guys were
from uh like based out of moscow russia you know we understood at some point we understood that we want to be in the us because you know we understood that if you want to build a scalable global relay company and and we had something that was unique you know no one ever has built it before so we thought there is no better place than silicon valley for that i mean at that point like now maybe there could be some alternatives which i i don't think they are equal but anyways you could at least say you know there is paris there is china there is i don't know dubai maybe berlin but uh london new york but uh silicon valley was the only choice so we went there and we started you know we we we we moved there and we started working there before we see so oh wow okay we kind of were yeah yeah we started raising there and stayed stayed in silicon valley so it was kind of uh a mix was it hard um you know when when something is done it feels like it wasn't hard but i think if you asked me back back then i would say oh it's impossible how would we get there and so on but when you do that then you think yes i also didn't know that you guys were already in states at that point i thought you guys like you know like applied from russia you came all the way from for the interview from russia which is like you know for us like because we came from canada and it was just like uh you know a few hours flight and we were like so like scared because like flying all the way from for eight hours for a 10-minute interview and you know but you guys if you're coming from russia you guys coming all the way for like you know on a 20 plus hour flight for just like a 10 minute interview it's like it's so scary but i i but but i love the fact that actually actually it is so so i was in in the us and and my brother was not was in moscow right now right and so he had to fly okay
yeah but the fact that you moved from russia to us with without like you know without
just like because you wanted to be in the startup community that's amazing man that's hard and that takes a lot of courage to do that uh like you know hats off to you and
like how you guys have built an amazing company it's just because of that kind of you know i want to be with the best people within the best environment to be able to grow yeah yeah i mean listen if you have a chance if you have a chance to uh taste what silicon valley is it's it's you should do that because in our world in technological entrepreneurship uh there's no bigger concentration of great minds who are so open to talk to you it's amazing because you know not in all cultures people are open to talk to you to uh advise to help you know and silicon valley is this this amazing uh you know uh a place where so many smart and open-minded people uh around you you're just constantly learning that's that's amazing would you say that was one of the reasons you guys did so well was the move to the valley uh well we've we've learned a lot i
think uh i think uh what you learn is the quality things so launching a product and being viral or uh all that is possible from elsewhere no problem you can you can hit the nerve
of the consumer and then you're having this growth but uh retaining users uh building a company hiring the best people learning what metrics really matter what what you know doesn't matter um raising quality you know raising money from quality investors who can help you along along the way so this these all things like to be a sustainable company to build a sustainable company it was more important for that more than just launching or having this initial success very cool cool um and so how was the uic experience for you like uh like the entire the four months yeah it's it's it's a life-changing experience um so first of all we were a bit uh we were thinking are we overqualified because we already had users we had this and that and we you know we thought maybe we're overqualified um you know the valuation was lower than we were it's funny you guys say you were thinking you were overqualified we were thinking are we under like uh are we like are they did they make a mistake for letting us in what's going on here kind of you know what i mean like yeah listen so uh then then i heard michael
michael cyble saying there is no you know there is no overqualified under qualified uh you know they they they want to take every like they want everyone to international local you know whatever ngo whatever so uh then we you know uh so so why is the experience why is the experience was uh life changing for us because uh i don't see any other scenario when i would believe in things that i believed in when uh we were YC the the mantra of weiss is make something people want yeah and you do that by talking to your customers and when we heard that when i heard that for the first time i thought i thought okay that applies to b2b startups that applies where you don't have too many customers that applies to startups maybe like us but in the beginning when you have a thousand customers maybe or a hundred customers but when you have
a hundred thousand customers it doesn't apply to you how can you talk to a hundred thousand yeah if you don't know the story when uh pg uh program asked what airbnb is doing uh in his office when they have to be in new york where they had like 30 30 clients um his reasoning was was amazing you know this is the only point in time when you can talk to all 30 of your customers uh if you want to build a scalable business you start doing uh unscaled non-scalable uh things yeah so i thought yeah yeah thank you it's an interesting idea for the next startup but you know i cannot talk to a hundred thousand people but when we kept hearing it from the smartest people we met in our lives again and again and again at some point hirachika and i decided to uh switch fully like full time 10-12 hours a day talking to customers and one thing that helped was that way key is a talking platform so we could talk and test on your own app yeah exactly but then we integrated intercom and we started talking to them uh through intercom because it gave us additional information about them and stuff but in a month in 30 day period we've spoken to 5 000 people which was wow amazing yeah yeah we were
only talking to customers you know in hours at our scale the only thing we could do to cover a large portion of of customers was by by uh just doing that so the founders
rachik and i were just talking to customers for a month and uh and we understood something and this something was that okay we've built we've built a wake up call thing when this then we started pivoting and so on but the value people are really getting
is not that the value they were getting was the conversation itself with the person where you can freely express yourself to express your emotions and the other person would feel your emotions would you know your sense of humor would kick in and you would build this trust uh based on this first just 10 15 seconds talking to person you already see if you can trust this person if you like the person or not and that was that and this uh this uh sincere conversation uh led to building sincere friendships on our platform but wiki was not built for friendships you know and we understood that you know we have to redesign and uh we understood much more than uh well you know yeah that's when you guys were redesigning i remember now when we had you guys were redesigning the app that's what this one just happened yeah oh wow interesting you know what's you know what's interesting though uh it's funny and i don't know if i told you a story or not um but you know remember in our batch pg came for one day for like one hour do you remember that yeah yeah um i was probably the only person who met and talked to him i don't remember that or not yeah i just ran up to him yeah yeah uh so i ran up to him and he gave us a probably the best advice somebody could ever give and it's funny like how you you know like you heard it from different people i had like pg talking to me directly right yeah yeah yeah yeah so the advice was basically go back what the hell are you doing here go back to alberta go back to your
uh which is our province where we're from go back to your he basically asked us what's our biggest school and then he was like go back to your school you're from and until you have you know eighty percent of the school using your app don't scale yeah because we were talking about going to a different part of the country and scaling and all that stuff right yeah and and we were like yeah yeah you're right but you know it doesn't apply to our situation because of x y and z like we came up with reasons in our own head right and it's funny like how you said that because like it says humans be biased be like yeah he's right i get it but it doesn't apply to us and we yeah and i've seen that i've done it 100 times i've seen other people do that all the time with their startups or in general but they're like they agree to the information they're like yeah what he's saying is right but they don't like but they don't like for some reason it doesn't apply to them which i think is fascinating human experience absolutely i think i think uh most of the great great uh lessons learned in startup life uh you can't you can understand them you can't even agree with them but you never you know it's very hard to to believe in them as as a as a case for you for your company and even harder to implement them so i think this is the biggest resource that we got in nyc uh you know uh they just were so we respected them so much that we really believed in what they're saying and really implemented the uh this mantra of talking to customers i think this is the biggest learning and the biggest change for us and it's easy to say is it to learn but it's not easy to to implement and uh you know i'm grateful to i see by the way you're mentioning pg so pj came uh for dinner and we are in in in line next to him and then he says what do you guys build and my bro pitches wakey yeah and for for maybe a half a minute or a minute and then pj makes this face and then says why did we even invest in you [Laughter] i was scared to death you know that's so classic i love it that's amazing um i got a question for you because this always comes up with like you know like the biggest uh reason startups break up is because of co-founder disputes right and like you starting a business with your brother did that how first of all how was it like and secondly did that ever um like you know obviously it's ups and downs a lot of them
did that ever lead to like a lot of arguments or fights or anything or like how i know you guys are really close and everything but like i'm saying that did that ever you know started like making the relationship a little worse because of the because you being co-founders in a high growth startup yeah no absolutely i mean um there's pros and cons we were raised in a family and in a culture where family matters and uh you know i don't know maybe maybe the closest from american perspective is italian uh okay you know lifestyle yeah so the family matters the most it's the most important thing in life and so on so so the pros are that we always knew that the brotherhood is bigger than any business issues right we would never we would never uh you know we would fight and we would try to convince each other we would disagree a lot a lot but uh we would always know that the brotherhood is is the most important thing so it would you know we would never separate because of the business uh so that's that's a good sign another good sign is that i i and tragic we always know that whatever the person is doing even if it sounds crazy even if it sounds irrational illogical uh the the your partner your co-founder uh doesn't want to hurt you right it's not uh it's not because of bad intention or because of ambition or because of something else you know you could just be suspicious about other people but not your your your own brother so we always knew when we are hurting each other it's not because we wanted to hurt each other it's just because we didn't understand something we disagreed and we we were stupid or something yeah so these are the pros the cons of course when you have uh 13 15 hours of business going you forget about the brotherhood about the relationship and all you do is work and at some point you understand that for the last year or something you nev you've never spoken as brothers you're always discussing business whenever you have a chance you only speak about business and that's not good for for for a family like us where herachik and i spend a lot of time talking just about life about the universe about you know whatever uh and we would discover ourselves that for a year we never spoke about anything than business and it's not great of course so it has some downsides as well um we disagree a lot now that we've been doing this you know for many years long of course it's easier uh and also we've understood who is responsible for what part and we have some rules between us like we have this this concept of strong opinion so if there is something where there is no right answer and you have a strong opinion and i have a an opinion but it's not a strong opinion then we go with your opinion for example just one of the things that we've developed to to make
better easier decisions basically awesome i love it man uh we're running short on time but i do want to ask you this question because uh i like i feel i get this asked a lot and i want to get your thoughts on this because you were we were the only social media app in our batch at least um uh first of all how much did you guys end up raising uh uh more than six million okay and then for you guys for us like because in social media you don't make money right so at least we're gonna start uh was it an issue for you guys because the runway like you know always shortens and starting not making money like was it a big challenge for you guys it was a big challenge it was a big challenge because uh in the beginning this all was built you know voice over ap was not that developed back then we had to build all this over gsm over real calls and it costs us fortune so we were spending a lot on that and at some point we've switched and and internet developed and 3g developed and all that stuff but initially we were spending a lot of money on telecom for example so burning money was was an issue and also at some point um pre-yc we've scaled the team too early we hired too many people and that was uh that was a bad decision so we you know we didn't we didn't know we didn't know the this user retention as a word you know we didn't know uh about that concept we thought when people sign up that's great but uh looks like for for social uh for social startups like us uh you know that's not the most important thing so would you what would you recommend someone because i get this asked a lot like hey you know and it's unfortunate because so naive and you look at it you're like you don't even know the half of it but i get asked this all the time hey i want to build an app similar to you know like like a social media app similar to facebook or similar to this and twitch or whatever i'll say uh twitter or whatever and i'm like man don't get into social unless you are super super confident so like what would your advice be to someone who's starting a social media app uh i'm not sure i'm the best advisor but i think general advice is optimizing optimizing uh the right metrics you know optimizing for the right metrics i mean for example stickiness what we call dau divided by mau daily users by monthly users right this thing should be high if this thing is high if you've built this for a hundred people and they keep using it in couple of months like 50 of them keep using it in a couple of months every day you got it right find people like this 50 lose the under 50 find people like this 50 and just uh show your app to those 50 because they have they are getting value and they will be talking about your app to people like them so i think that's that's you know very hard to do uh and it rarely happens but uh that's what you should optimize for love it i also like one thing where i think at least personally and this was also the mistake we made uh which led to venture to our failure as well i think that a lot of people try to clone and already build system and they're like you know trying to make it a little bit better and i think i remember i don't know who said this i think it was dave mcclure or someone or oh i see i don't know maybe it was you said that but someone who said that it was like i think it was pop pg you said that was like basically your new pro the new product should be 10 times better yeah the old solution right 10x cheaper 10x better or whatever yeah yeah and i feel like whenever people are trying to make social media apps whichever that might be they're like i'm trying to make a new new facebook or whatever and it's just like a little bit better it's not like you know in the new linkedin in the ideal world this is how it will be and you're like well it's hard because you're trying to fight against this whole everyone's on one place you're trying to get people moving from right it's it's a it's a difficult and so that's what i think it's a crazy one we made the same mistake because we were so close to yiki we're not 10x better um which i think yeah but at the same time at the same time you can talk you can't tell the same about the products that really worked for example facebook facebook was you know pre-facebook we had friendster myspace you know whatever a classmates uh linkedin uh and uh you know you you couldn't say at that point that
facebook is 10x better right now it is but i wouldn't yes i mean i would hate being a vc for example i i never trust myself in terms of oh yeah this this company will be great or this will this product will will work and this will not i never know but i think the secret is is spending as little time and money as possible to build an mvp and show it to the right audience and see if they get the value if you can do that experiment with it so spend three weeks spent four weeks design the thing just code it yourself with your friend with
your body and show it to 100 people that's doable without any any money if if this works for these hundred people then you you know you know you have you have a future you just go to vc and you say here is hundred people who tried this there is 50 people who use it in two months here is what we we've spoken to them they say this and this this is the value they're getting uh so you know we want to scale this and
then you can raise then you can build whatever you can you can find great uh teammates and all that stuff so i wouldn't say don't do it just don't spend too much resource on that because the rate of failure especially in social is super big so you will fail most likely don't spend too much resource you know fail quick and if you don't failed lucky you go and raise and do do all the yeah and even like even like the company like that got out by facebook i think they work on i remember the name now but this company they did like uh uh like they did like for high school students that did these polls or like uh they were kind of like yeah it's rated version of yik yak and us as
well and they did it for seven years they built a consumer app app after app kept on failing and they kept doing for seven years and they got acquired for uh over a a hundred million dollars and then they got shut down in like in like uh in like two months or three months after facebook bought them so it's like you know it happens it's just like easy right like it's a small percentage of when and even after you kept on doing it and eventually ended up making something cool which blew up still might fail which is crazy um yeah awesome and i want to do last uh segment here quick four quick fire questions only one to two sentences each yep uh let's do it so one hack you guys did to grow your business that nobody knows about uh that's a really hard one you know it's a really hard one but i think i think the biggest thing that we've really done is this talking to customers spending time spending quality time long conversations with customers to understand what they really want and what they really get from your product and optimizing to provide this value to this kind of people i think that that helps us helped us to uh you know to get to the next level love it okay uh advice for someone applying to yc well there is so much material online uh you should read there's a lot uh you should talk to other yc founders and you should get recommendations that helps at least to get interviewed uh and you know also don't get frustrated when you are not invited or when you reject it for the first time that's totally fine uh it's it's a process you should you should do it several times love it advice for someone starting their first startup oh uh if i if i didn't have my my co-founder my brother i wouldn't survive this long that's for sure so having having a good trustworthy co-founder is the basis um and then the rest you know constantly be learning be learning every day new stuff uh either from people or online there is so much stuff to learn now you just have to be you know pick the right things but i think uh having a great partner and learning every day is is important love it and last question what is the one thing you can teach me i don't know bro uh i i think i think uh i think uh with you know i think failing is a great great uh learning so we failed a lot and uh and i think that's you know if you fail and you keep fighting uh i don't know what to teach you really if you fail and you don't you don't find maybe i would say you know don't get frustrated but you do fight and i think that there's you know i i i don't have uh lessons i don't consider myself a teacher in this case that's right awesome and thanks so much for coming on i really appreciate your time yeah me too bro it was great to talk to you great to see you again and uh hopefully we will see each other in person 100% we'll talk soon