Better Product Weekly: How Early Stage Companies are Handling the Current Climate with Darrian Mikell

Episode Transcription

Anna:

Welcome back to Episode Two of The Better Product Weekly, our miniseries that's just focused on sharing insights from product leaders on the challenges they're facing and what they're trying, how they see the current climate, just affecting their product.

Christian:

So in the last week, we've seen a million other things happen. So you posted an article on Slack earlier today about Notion's raise. That was interesting.

Anna:

Yeah. It was kind of the first hint of, I guess, positive news coming out of the early stage startup world. I mean, we're seeing that they're getting hit pretty hard right now. But what I thought was pretty interesting about Notion's raise, it's a New York Times article and they raised $50 million on 36 hours, which, amazing. And while that's a headline in and of itself, I think one of the couple really interesting facets they call out in the article is that, first of all, Notion was trying to grow with not as much VC funding as many other startups, and that they decided to take this funding in the face of everything that was going on, the fact that they help people collaborate from home. But I think it's really interesting, too, that they were profitable, and I think they call this out in the article, that they're kind of saying, "Are we signaling the end of these grow-at-all-costs unicorn startups?"

Christian:

Yeah, I don't know-

Anna:

I don't know, Christian, what do you think?

Christian:

Well, I don't know. Are unicorns immune to COVID-19? We're about to find out. I like that you brought up investment. I hadn't really thought about that. I mean, we haven't really seen a recession since ... Of this size for a while, so I don't know in detail what happened in the past ones, but to see a company that's already profitable raise just to help them get through this is an interesting take, so I'm guessing we'll see some other big ones do that. But from the early stage standpoint, I think there's a lot of fear, too, about other investments drying up, and so far this week I just happened to talk to a few investors. Some in Series A phase and some in the early stage, so maybe 100K to 500K ARR stage, and what I learned, which is not new, I think this happened last time, there's a lot of products that were trying to go get investment are finding a lot of investors not taking on new investments and they're instead saving their money to help their existing portfolio companies.

Christian:

But on the early stage, the people I've been talking to, angels excluded, I think angels have stopped right now just because they're all worried about their own probably personal finances, but early stage investment, they still are planning to continue investing, but because some of the later stages aren't investing, their portfolio companies that would normally be going to get Series A are also coming back to them asking. So it does impact, it's almost like it goes downstream and even effects because you can't get those, so they're trying to get bridge rounds, and I think they're still happening. But I do think that early stage investors still want to keep their eyes out for new things, especially because I think the other news coming out this week is a lot of people that are losing their jobs and some good talent will be mixed back into the tech pool and will inevitably, hopefully, optimistically be starting new products here towards the end of the year.

Anna:

That's a really good point, and you said something that ... I feel like in the last, gosh, 12 years, a badge of honor that people really wear and that we've heard a lot is when people talk about how they started their startup during the recession. I feel like I hear that a lot, and I think people are reminding us of that right now, but I'm curious with what this will mean for the next ... Are we getting out of that unicorn, grow-at-any-cost? Is that bubble bursting in this recession? And now we're going to start to see more startups come out of this building sustainably because who would have ever thought that we could live in an economy where everything would just fall apart so immediately? I mean, the unemployment numbers are absolutely staggering. They said that they're larger than the first six months of the first recession, so it's interesting to see what innovation this will breed.

Christian:

I mean, it's probably not exciting right now for most people, but if you take the longer view of what's happening, I think what is exciting is to think about what will come out of this, from that perspective. I wish I knew where I read this, but somebody had broken down some of the top startups that came out of each calendar year over the last 10 years and the ones that have been performing best were the ones that came out of the recession. I think Airbnb might have been one of them, although this article was probably before ... It was like three weeks ago, so they're getting slammed right now, too, but one thing about new things is, the last recession was just systemic, it was awful and it wasn't ... It was just like there was nothing inspiring about it, but this one is interesting because of the reason we're in it is because of this virus is causing us to stay home, and what's really, I think, hopefully at some point will be exciting is the things that it's going to be opening up.

Christian:

Obviously, we're on Zoom and we're talking about Slack and all that, but that's just the tip of the iceberg. It'll be really interesting to see what companies do in the space of remote first or even ones that aren't remote that now have to figure out, what does a remote in-person hybrid look like? There's going to be a lot of innovation just because of what the virus has done to all of us in our work days.

Anna:

If you think about it, you talk about the startups that came out successful from the last recession. I mean, it was a lot of those gig economy startups, and I think it's almost like the financial crisis really, really jump-started the gig economy in and of itself, the idea that we've got other assets to sell or giving people the opportunity to kind of make that side income. I think it's taken off in a lot of potentially unproductive and unsustainable ways, however, yeah, I'm curious what will be the output of this one? Is it going to be kind of the telecommuting? Is it working from anywhere? Is it going to really jump-start that nomad lifestyle? I don't know. It'll be really interesting.

Christian:

Nomads. Wow. That would be really dramatic. That would be like a full post-apocalyptic-

Anna:

Yeah.

Christian:

Hey, we're in our house, and then once we come out we all are just nomads just roaming the earth.

Anna:

Yeah. I love it.

Christian:

Following the seasons and where the virus hot spots are. That's the perfect ending to this.

Anna:

Yeah, we would just become hunters and gatherers, but for tech jobs.

Christian:

Yeah. Well, it's an interesting topic, this remote world, because we talked about other industries, I think the easy ones people were saying were like, "Well, food delivery," and, "delivery all this." And I'm not as ... I don't know, I don't think I'm as bullish on things like that. I know people who own restaurants. They don't want to be a take-out restaurant, they're just doing it to stay afloat. It's not their new business model. It's not like this was just like, "Oh, wait. I can just run a restaurant through delivery. This is great." It's sort of like, "This is the only thing I can do to sustain." But I think it's actually a good segue to who we're going to have on today, Darian Mikell, who's working on an interviewing solution that's remote, and it had nothing to do with where we're at today, but I think it greatly ... It changes the trajectory of what he's trying to do to have that value prop there.

Christian:

And I think that interviewing, for example, is one of these things that ... I think everybody would rather do a job interview in-person, so I don't think anybody would say, "Oh no, we would rather not do it in person. Let's do it remotely." They would say that now, but I think going forward, I think what's going to happen is you're going to have to have a way to do it, whether it's a remote job, you're working remotely, or if there's something like this that happens again, you need to have that option, be flexible.

Anna:

So this week we have Darian Mikell with us, CEO and Founder at Qualify. So Darian, thanks for joining us today.

Darrian Mikell:

Yeah, thanks for having me, guys.

Anna:

So just to kind of start us off, could you give us a quick overview of what Qualify does?

Darrian Mikell:

Yeah. So Qualify is an early stage company. We offer a software that helps recruiters and talent acquisition professionals to streamline their recruiting, specifically on the phone interviewing side. So it allows them to pre-record phone interviews and conduct those with their candidates at scale, helps them be more efficient, and adds convenience to the candidates' side as well.

Anna:

I'm curious, what's been the most challenging part in the last two to three weeks for you and your company?

Darrian Mikell:

So for us, not a ton has changed. In the day to day, we're already pretty remote, but for our clients and potential clients, obviously the landscape has shifted quite a bit, and it varies really from company to company. Some companies have frozen or slowed down hiring, and so our product is less useful in those specific circumstances, and then other companies, other industries are ramping up hiring, so it's more about reaching out to those folks. And so we're navigating this to figure out who those industries, who those companies are and kind of doubling down our efforts on those specific niches right now. So some of the aspect is just, it's always been getting in the door, but especially with everything going on right now, there's obviously priorities that other companies have, and so it's just, one, finding a good way of going about it, trying to be helpful, but also trying to insert ourselves and be helpful to them specifically with what we offer.

Christian:

So when you were really starting this, I know you're still early stage, trying to find traction and early adopters, but when you were first thinking about going to market with Qualify, were you focused on any particular industry to start or was it really just driven by behaviors, like recruiters that had to interview a lot of people?

Darrian Mikell:

The original problem came from my experience in the tech companies. We were small but quickly growing at my previous company, so I used that as kind of the model for what I thought would be the problem that other people in similar industries might face. Over time, I was learning that although some of those smaller fast growing tech companies may face some other problems, it might not be to the same degree that are the people we go after now feel, so we focus more so on high volume hiring. There are specific industries that tend to limit themselves to more high volume hiring, so we go after those.

Christian:

Have you found in the last, I guess maybe three or four weeks, have you found that you've had to change the way that you're talking? [inaudible 00:10:35] Do you change the way that you talk about, that you connect Qualify to their pains, to their feeling? I mean, how do you handle that side of it?

Darrian Mikell:

Well, yeah. In terms of messaging for us, and I think there's two different things that we're looking at, both short term messaging and long term, so to give you guys a quick synopsis, to this point, before coronavirus, we had been messaging around low unemployment and the need for speed to be crucial in your recruiting practices, so that's where we fit in. That's where we tend to fit in really well, that we can help recruiters scale, help them to reach out to their candidates a lot faster and get that information from them a lot faster. But now, as things are starting to shift, when we think about long term and the effects that this is going to have in terms of higher unemployment, our messaging is definitely going to have to change. We do feel like we fit well to scenarios, but we definitely have to message around that.

Darrian Mikell:

And in the short term, we're definitely experimenting with different messages that are going out the door, both in terms of, one, just us wanting to be good Samaritans and be helpful to these companies that we're reaching out to and offer our services in different ways that we haven't before, as well as just trying to understand the specific needs that a company might be facing right now, depending on where they're at in their [inaudible 00:11:53].

Anna:

How do you balance those two things? How do you reach out to a company to be helpful but also because you have a product that can really help them?

Darrian Mikell:

It's just tough because you don't want to be viewed as the people that are just trying to take advantage of people in pretty terrible circumstances, but at the same time, if you truly ... And this goes in all scenarios, if you truly believe that you have something of value to offer somebody, then it's almost your duty to reach out to them and let them know that you're available. So I think it's just being cognizant of that, that they might have different priorities and different things that are top of mind for them right now, while still just letting them know that the solution is out there, is available.

Darrian Mikell:

For us, the type of product, the type of solution is relatively new to them. Beyond Qualify, the type of technology that we offer is pretty rare in the market from what we've seen, and so one is just getting them to be aware of it and then trying to do it in a tasteful way, especially right now.

Christian:

Yeah, seems to me like you had something unique where you're doing audio recording answers to questions of interviewers. It seems like that's always been a hurdle for you to explain how that's different. But since things have changed over the last month, do you find it easier to connect why that's valuable to people even though it is a new thing? Is it easier for them to sort of see why they would even need something different like that to begin with?

Darrian Mikell:

Yeah, I think so. It's gotten easier and easier for us to tell our story, and I think part of that has to do with our target markets. As we've gotten closer to finding the right targets, the objections seem less and less, and the understanding of what we're offering from a high level is a lot clearer, and we just have to do less explaining around how this could be valuable. They usually see the immediate ... They see the value pretty immediately.

Christian:

What about the product itself? Has there been any impact on what you're building or planning from the product perspective to handle any of the changes in the market?

Darrian Mikell:

We haven't gone forward with building anything specifically, but it has made us really start to brainstorm around ideas. We had a product roadmap just in the wheelhouse of phone interviewing, there was just features that we wanted to continue to build out, but in light of current circumstances, the market is definitely changing, the unemployment is definitely changing. I know a lot of people are either laying off people or furloughing people, and so those people are going to have to work again and be hired somewhere again or maybe even at the same places that they were working previously, so we're just thinking about what that means in terms of hiring hopefully in the next few months, in trying to maybe think about different solutions all together that could help those teams do that much faster, do it more efficiently and just do more with less. So nothing concrete at this point, but we've thought about completely new products, completely new solutions that we could think about building out here soon.

Anna:

It sounds like you're seeing definitely some opportunities for where your product can pivot to really support kind of the next phase of what's happening. Are you kind of pausing and waiting or what's that process look like?

Darrian Mikell:

It's really fun for me because I like new ideas, and so I was just talking with my brother, who is my co-founder, about some of the new ideas that, a lot of them have come from him and some of the research that we've done prior, and for me personally, it's just I have to kind of temper my excitement and not get too excited about these brand new ideas. So we're kind of going about it the way that you would go about building a new product. Right now, it's just kind of conceptualizing and then we'll probably reach out to some of our friends, customers in the recruiting industry and just get their feedback on some sketches and concepts and see if there's some value there that we could start to do a quick sprint around and get something out to the market fast.

Darrian Mikell:

In terms of what we're thinking about building, it would be potentially yeah, like pivot our repurposing of different aspects of our existing products that we could get it out into the market much faster than a completely new build out.

Christian:

This has been really great to hear your perspective on this, Darian, and I don't know that it's quite the time for us to sit here and be like, "What's everybody excited about?" Because it's very challenging, but I guess I am a little bit ... As you've had some time to reflect on the last month and then think about what's coming next for Qualify, what are you excited about or what new opportunities are emerging that you're interested to explore over the next three months?

Darrian Mikell:

What I've been telling ... Right now, we're in a very interesting stage because we're trying to do a lot with a little. We're trying to raise money, we're trying to increase sales. We're trying to do a lot with a small team, so I think what I'm most excited about is the potential opportunity that's [inaudible 00:16:58]. We don't necessarily solve all problems for all employers, but I definitely think we could be a unique solution for some teams, and during this time, people are going to be looking for digital ways to do, or more ways to do their work digitally, and like I said, what we do doesn't necessarily solve every single aspect of hiring, but it can be an opportunity for us to, at the very least, get more eyeballs and get more interest into what we offer as people are searching for these types of solutions.

Christian:

Well, we definitely wish you luck in that and I think it's a good perspective, and I hope for the next few episodes we do this, we end ... As we get ... People start to emerge with a more optimistic mindset about what they're doing, but it sounds like you've got some interesting opportunities and definitely appreciate you coming on and sharing what you're doing right now and sort of where your head's at because I think a lot of early stage startups are wondering what other people are doing, and I think you gave us some good nuggets of wisdom there. So thanks a lot for taking time away to talk with us, Darian.

Darrian Mikell:

Yeah. No problem. I appreciate you guys and appreciate you reaching out to me and having me on.

Christian:

So that was Darian Mikell, the CEO and Co-Founder of Qualify. Like we said, he's in very early stage, still getting traction in the market, so I think this happened at a tough spot for an early stage, but he's also working on something that lends itself to sort of the remote life that we have right now, which is helping recruiters handle some part of the interview process remotely. So I think it was interesting to get his perspective with that in mind, but even being set up to solve these unique problems, it's still really hard for him to strike that balance for how to talk about it, how to capitalize on it, and those sorts of things, so I think it's still a challenging problem that he's facing.

Anna:

Oh yeah, for sure. I think he's in a good place. He's probably in better place than I think a lot of other founders right now. But it's interesting to hear that he is, I think he sees a place for Qualify and I think he's energized by his opportunities, and I think it's a really interesting perspective to have in a time like this, where it's like we have so many great ideas [inaudible 00:19:16] kind of just going to start testing things out.

Christian:

One topic that he touched on that I think is really useful for people listening to this is his, kind of the way he positioned the messaging that he had for his product before this and what it is after, and he didn't say that he's got all the messaging figured out for this new world, but I think the fact that he's even acknowledged that ... I think he even said something like, "It's easier to tell a story now, but it's different and what people are valuing is different." He talked about, "Now it's about unemployment, it's not about ... Before it was scaling your recruiting team and moving faster. Well, now that's not quite the same." So he's had to acknowledge that the before and after affects the story that you're telling as a product and you need to acknowledge that. And even though he doesn't have the right answers right now, he's understanding that he's got to go out and experience with new messaging to figure out what's going to resonate in this post-coronavirus world.

Anna:

Yeah. Darian, I love hearing him talk about his messaging because I feel like talking with him in the past he says it every time I've heard him talk, that he's always consistently experimenting with his messaging, he always has been, and that's kind of part of him building Qualify. But I think it's like those agile scrappy lessons are now serving him really well again as he moves into this new phase where he's always trying out different ways of talking to people.

Christian:

Yeah. And that's really the point of the show is that we're not going to get people on here that are going to be like, "Oh, I tried this thing and it worked. I can prove it." It's too early. We don't know, but that's why I think it's worth calling out what he's doing, so I hope that people listening can understand that even just pausing and saying, "What was true before that isn't true now? What's true today that wasn't true before?" And then figuring out that. And if you're in a position like he was, I think he also said something like, "It's your duty to let people know that you have something that can help them, but you have to handle that delicately."

Anna:

Well, I love that because I think he said that so well and he tied it ... I would tie that back to Amy Brown last week saying, "We are helping people tune their ear to what their customers are saying." And it's that same thing, it's like, if you have something that can help people, you have a duty to let them know that you have this thing. It's not predatory. It's not opportunistic. It's just like, I can help you because I have this thing I've already been working on. I just love that [inaudible 00:21:38].

Christian:

Yeah. It's great. And it's a good segue to ending this show because before we end it, it is our duty to let you know that we are going to be hosting our first panel. This one is great because we're going to get ... Amy Brown's going to be back on.

Anna:

That's right.

Christian:

We've got Miles Grody, who was on the podcast, season one I believe, from Upperhand, talking about what he's doing, and we've also got Andrew Carp, whose head of product at Emplify. So pretty good line-up of people to kind of talk about all the different things that they're challenged with and things that they're trying. It'll be our first digital panel that we've conducted, but it's a way for us to gather these product leaders and talk about the challenges that we're having now. Anna, you're going to moderate, and if people listening to this want to sign up to go if you haven't already seen it, you can go to BetterProduct.community/events, and that will just redirect you right to the Event Brite page, and it's free, so we highly recommend you join. And if you can't make it, don't worry, we will record it and it will be the next episode of Better Product Weekly.

Christian:

I hope this conversation produced you with a fresh perspective to tackle the week ahead, and if you're looking for more resources this week on how to adapt your product to handle incertainty, we're hosting a virtual Better Product panel on the subject. I don't like that. Actually, I feel like what we led up with was good. We covered it.

Anna:

Yeah, just say the last part.

Christian:

I think I'll just ... I'm going to do ... Okay.

Christian:

So if you're interested in joining us for the panel, visit the Event Brite link that is in the episode details that you are listening to right now. So you can register there, it's free, and if you can't make it, don't worry, we will be recording it and it will be on the next episode. But we would love to have you there. We will make time for a Q&A from the audience, and of course, Anna will be the one taking your questions, so please join us on April 9th.

Anna:

Well, thanks for listening to this episode.

Christian:

I'm Christian.

Anna:

And I'm Anna, and you've been listening to Better Product.

Christian:

[crosstalk 00:23:32] Better Product Weekly.