Deel Speed: From $1M to $100M in Less Than 2 Years - Deel Co-founder, Alex Bouaziz

0:00You just need to have a very high bar in terms of how you're hiring. Whenever you are looking to hire really fast, you tend to lower the bar. Is that person the right person for the business? Maybe not. As long as they can do the job, you know, they will be inclined to hiring them, which is, I think, the downfall of most companies, right? Hello, and welcome to Giant Ideas with me, Cameron McLean, and me, Tommy Stadlen. We're co-founders of Giant Ventures, which builds and backs purpose-driven companies. At Giant, we're lucky to meet extraordinary people with Giant Ideas that are changing the world.

0:28This podcast brings you behind-the-scenes access to those ideas and the inspiring stories of the people behind them. We explore how one giant idea can kickstart a billion-dollar company, shape culture, and transform life as we know it. Today on the podcast, we're joined by Alex Bouaziz, co-founder and CEO of Deal. Deal is widely regarded as the fastest company in history to reach$100 million in recurring revenue, achieving it in just 20 months. He is the master of blitzscaling. So we're going to learn a lot about how to grow startups really, really fast. Alex is a Silicon Valley outsider who's grown his business to a billion dollars in revenue at a$17 billion valuation, backed by some of the top firms in Silicon Valley.

1:10There is so much to learn here in building startups. Alex, welcome to Giant Ideas. Thanks so much for joining us. Well, thank you so much for having me. Excited for this. At the time when you guys started, there were a few people trying this. COVID obviously helped a big driver, I imagine, of everyone's growth in this sector. But you guys specifically won. You are the biggest, the best. What is it that you did differently to others that made you win? I like to think we're the biggest and the best. I think we still have a lot to do to get there. But for context, Dill today serve over 45 ,000 companies across a multitude of HR and global payroll services.

1:52So we've evolved a lot as a company. And I know a lot of people like to paint us as one of the COVID winners. But the truth is we were only one year old when COVID started. We started in 2019, like I just said. And I think COVID started in 2020, March 2020, which correspond with us raising our Series A. So I think the team did a decent job at riding that wave, I think. Not on purpose, to be honest. We were a very small company, 15, 20 people at the time. But the fact that we were enabling a lot of companies to help hire globally really played into the hands of what a lot of people thought COVID was pushing forward.

2:32But, you know, today we've evolved a lot as a business and, you know, very much focused on building infrastructure to help the companies being able to scale. And remote workers are just a part of this. Alex, I was talking to a founder, Elliot O 'Connor, who knows us both in preparing for this. And he told me to ask you about something quite specific, which he thinks was profound, which was when you were starting out, you started by enabling companies to hire contractors rather than employees. employees when everyone else was starting with employees rather than contractors so you kind of when others were zagging is Elliot right was that an important early decision look I think the story of deal where we got really lucky is we followed our customers the initial idea was was very simple was you know a lot of companies are hiring globally and one of the model in which they're hiring globally is through freelance right it was very common for companies to hire people for the freelance model.

3:27And the unique insight I think we had was I know how the French system works, right? I know how the Israeli system works and other companies system work. And I know that you cannot just send money to someone on TransferWise or PayPal. That doesn't work. So there was definitely something there in terms of by design, right? You need to understand local structure in order to engage someone in another place. We were very sure of our stuff, right? We knew that we had to fix that problem. And we launched a freelancer product as our first product. and is still one of the key products of the business today.

3:56And then we very much followed our customers, right? I remember getting on customer calls and them telling me, no, but Alex, I really want to be able to hire employees in different geographies. And I was like, well, we don't do that just yet. And after hanging it once, twice, three times, you're like, well, maybe I should just build it, right? Maybe that's the best way to do it. And the story of Dill is actually built through following our customer base, right? Today, we went from contractors to employees where you don't have infrastructure into employees where you do have infrastructure into having a full employee base on our HCM into having to manage immigration because some of the employees were hiring on your behalf needed a visa.

4:35So might as well figure it out for the whole stack. So I think we're very much the story of if you listen to your customers, post your initial idea and your initial conviction, you can build something really big. And there's a lot of breadth that you could be doing. And in the very early days when you went through the Accelerator Y Combinator, did that involve pretty radical changes to what you were trying to do? Did you essentially pivot a few times early on? Yeah, you know, I think, yeah, I'm quite academic. And so was my co-founder, right? I went all the way to a PhD, which I eventually dropped out of.

5:10And I think Y Combinator in many ways feels like school a little bit, right? Like they usually take three young people, put them in the room and kind of put them in that like time bubble. I don't know if you ever watched like Dragon Ball Z, right? But you're like in that time chamber where you just focused on delivering to your customers and growing and telling your story and working through that. And it was very interesting because they really put us in a place where, you know, based on The way they function is you have group office hours every other week, and you need to show progress and to show growth and you need to show that you've talked to customers and built a building a good business.

5:45And what that really allowed us is like being in a quote unquote time chamber that really got us to focus on the metrics that were super important, including talking to our customers. And through that very intense three months, you kind of have to be very honest with yourself, right? Is what I'm building the right thing? Am I talking to the right people? am I trying to convince myself that I'm building something great or not? And that experience was super valuable for us because I think throughout this whole time, as a team, we pivoted actually back and forth between ideas almost like three times.

6:17And I remember our YC partner was one of the best partners, I think, once he ever had Aaron Harris, joking around like a week before demo day when we had our first presentation ever saying, oh guys, they pivoted on Friday, which was eventually what the idea of deal was. So I think that time chamber is very well served for founders in order to really get to the right market and to the right product. So you guys are famous for being the fastest from zero to 100 million of recurring revenue. I think you did it in 20 months. We were, but you know, AI and Wiz have changed the game a little bit there.

6:49Yeah, but still not bad. And you're now up to a billion, I believe, and more. But let's talk about not the sort of 10 to 100 million. Let's talk about the one to 10 million that really early journey how did you very tactically go about doing that yeah so the interesting part is like that time chamber i talked to you about is something we carried on till today even right like very much looking at month on month growth how are we evolving how are we changing even sometime week on week growth still um so we kind of kept that same mindset right like the thing after those type of accelerators is after you quote unquote like graduate post-time funding you, you're kind of alone.

7:26And one thing we're able to really tackle is carry this forward. So we kept doing the same thing. Every month, are we growing? Are we going forward? Are we in the right directions? Are we onboarding enough customers? Are we talking to enough customers? And that really helped us carry the momentum where the combination of this. And similarly, if you translate the concept of office hours, doing monthly investor updates, where you tell your investors, hey, this is where we are at. this is what we're doing, kind of keeping yourself accountable more than anything else, really, is what carried us to eventually, you know, raising our Series A and the momentum that we built up there.

8:02So, you know, it was a mix of just a lot of grit, a lot of cold calling and cold emailing and trying to bring as many customers on the platform and just iterating really quickly. And funnily enough, with the scale that hasn't really changed, it's just a lot more people, I guess, doing it at the company. You guys are probably the best example of a startup sort of doing speed of execution, essentially. And VCs and founders love talking about speed of execution. I'd love to demystify that a little bit with you, Alex, and just talk in reality about what that has been like. What does speed of execution mean to you?

8:36What are the tactics you did deploy and still deploy? What's the culture you need to build in order to move fast? And why does speed matter so much? Yeah, I think it's obviously a very loaded question. and my effort is always the same. It's what I find is as a company gets bigger, right? Like the beauty of a small startup is everybody's in the room. So everybody is moving fast because you're holding each other accountable all the time and you're in constant momentum to get stuff going. And the thing is the more people you bring into the company, the more the company scales, the more it becomes normalized to get something done later on.

9:13Again, today, you know, maybe I'll get mad at someone after this call. You know, they need to get something and in their email, they said, oh, I'll get back to you on Thursday. And I'm like, dude, you're on Tuesday. Why don't you get back to the person at the end of the day, right? And I think that's the type of momentum that you need within a company for it not to become stale. Because that applies to everything. It's not just to customers, although it is the most important, but it's also in how fast you launch product, how fast you iterate, how fast you try new things, how fast you hire, how fast you fire, right?

9:42And that momentum is something that was very important for all of us and something that's very important for me as a person. I want things to be always moving. I want things to be always trending into the right direction with our customers. And I think generally, you kind of have to be the statu quo where as your company is going to scale, everyone is like, oh, you slow things down. You need to go a little slower and things like that. We're always very against it. And one of the most fascinating thing actually happening at the moment is with the whole AI bubble-ish, depending on how you think about it, but I actually think very pragmatically with this whole new technology, it's actually become great again for founders to be able to go into the details and move really fast.

10:28So that, you know, that part of the job that I really love and where people will be pushing back on me internally, you're like, everybody's like, well, no, please lean in. Let's try to change as fast as we can, right? Which is very, very amazing to see. But yeah, if you were to narrow down deal speed, you know, for me, it's always going to be about how do you create constant momentum? How do you make sure everything is always moving forward and there's things happening inside of the organization across the whole department and no one rests on their laurels right um whether you read a book like amp it up who i think you know it's a great representation of that or you should always be uncomfortable right if the organization feels comfortable if one part of the organization feels comfortable it's because they're just not challenging themselves to do better and this is what still speed has always really been about that speed obviously compounds doesn't it you know the over many, many decisions, many people as the company grows, that speed compounds.

11:16As the company grows, what do you look for in people? What are the characteristics of the employees you're trying to get to make sure that as you grow across thousands of people, you're still quick? Yeah, I don't think growing across thousands of people is the thing you should be doing as a company. I think there's different scenarios in which companies should, right? In our case, we have infrastructure. we had to deploy it across 150 plus countries and having the local understanding and the scale and building payroll engines locally. It's very complicated, right? But I think you should always optimize for having as many A players in a very high talent dancing team that are your company.

11:54And if you can't, because of the virtue of how the business is set up, then you just need to have a very high bar in terms of how you're hiring things. And one of the traps, you know, I've seen a lot of companies fall through and fall in is whenever you are looking to hire really fast, you tend to lower the bar, right? In terms of who you're hiring. Because even your internal team, right? Like they just need someone to do the job. Is that person the right person for the business? Maybe not. As long as they can do the job, you know, they will be inclined to hire them, which is I think the downfall of most companies, right?

12:25Like when you start having that mentality, which is like, look, I don't really care. I just want, I just need help. That's when the company's culture and the company's talent density really start to fall apart, which has... in my opinion, huge repercussion, right? It has a huge impact in terms of your best talent, right? If I'm an A player and I'm carrying the team on my back, there's a point where I'm like, you know, screw it. I'm just going to go somewhere else where they value A players better, right? So that has always been super important to us. And we've always spent a lot of time forwardly thinking about who we're bringing to the company and what culture, what part of the culture do we want them to embody?

12:58We also fire quite fast, right? Like what's important for me is I want the A players to be able to be empowered to do their best work. And a big part of that is make sure they're surrounded by other A players that want to be here. So, you know, we have a pretty strong culture of making sure that the talent density stay high. So you obviously hired brilliant people, but one way you've supplemented hiring employees is you've bought companies. You've bought an unusually large number of companies. I think it's 13 companies in six years you bought. Is that partly to get entrepreneurial talent into deal alongside yourself and your co-founder?

13:32Or is it as much about getting that founder DNA and leadership positions as it is getting the product that they've built? Yeah, it's a mix of both. And I think this is something that's quite misunderstood about deal strategy, which has actually paid such significant dividends for us. The first one is, you know, the way you go about going multi-product as a business is typically two paths, right? Like the first one is the founder spends a lot of time thinking about the problem set, like I did for payroll or for HR. And the first products that we ever built are freelancers. And then, you know, there's just so much you can do, right?

14:06Like there's so much personally, for example, I can do and I can go deep on. So then comes the second wave of product that you're building. And the two paths is either you hire PMs from companies that have built similar products and you're like, hey, here's more budget or go and build it within our ecosystem, which to me, you know, I love my product team, but I do think there's something special behind someone deeply caring about some subject and building a company and spending years going deep and talking to thousands of customers. I think that's the best way to build companies. So that's the other part, right?

14:37The other way is going and acquiring companies with amazing founders that have actually really built a great business, right? And really kind of piggybacking on all of their learnings and years of spending time with customers and rebuilding that inside of the application. And then what you do there is you give them the resources and say, okay, we love your product. Typically, you do this with a company that's at series A, maybe there's be at max and you just give them the infrastructure to be able to rebuild their full suite of product inside of deal with the knowledge they have with the experience they have you know when when you're a founder and you're building the worst product market fit you tend to build so many features but if you were telling me for example a deal like i could tell you the features i build that bring zero value to the company so you actually the even the higher impact that you have is you get them to build what actually matters and not all of the things around that didn't really drive sales or didn't drive customer experience.

15:29So bringing that was super valuable for us. There's another reason we do M &A as well, which is less reflected in this and maybe less reflected into our product. It's generally a bit more revenue driven. We are, as you said by now, the largest company in our market. And payroll is a very, very sticky product. Typically, you don't change payroll provider unless you have a very bad reason to. So being able to go out into the marketplace and buy companies in our space and buy amazing logos into our space and move them into our infrastructure so that we can show them how much better we are but also show them all of the other products we could be consolidating for them is is very helpful um so yeah i mean you know i think mna is probably one of the most uh underappreciated strategy to grow business and uh it's really helped us develop ourselves a lot faster than most companies would alex i saw one of my startups to microsoft and And it was pretty simple.

16:22It was amazing, but ultimately pretty transactional. And you stay for the earn out. And then by the end, you're like itching to leave the big company. And you want to go start something else again. And you get out and you move on. And there are not that many examples of acquired founders and CEOs sticking around at the acquirer longer than they have to. I think you've done something different. How have you incentivized founders that you acquire to stick around and be truly motivated to build great businesses? Like the Hoffie founders that we know, for example, you acquired. It seems like they are truly on a mission to build Hoffie inside deal to be enormous.

16:56I sure hope so. You know, if I stand by the first part of what I told you, right, like you don't really want to lose out on this talent a year after. Right. So, you know, there's a couple of things. Obviously, there's financial incentives. And whenever you structure an M &A deals, you know, one of the things I've learned is you want to build a deal where both sides of the transaction come out happy. right like i want to be able to look at sami and michael right who are the founder of hoffy which you mentioned in five years from now and i want them to see just to think at least like the acquisition was the best path forward for them and if you get there then that's already a huge win and the second part is you know what most founders want is the flexibility to be able to operate um the the last thing you want is to become a cog in the system where you don't really have impact anymore and you cannot really drive your business and there's multiple ways to solve for The first one is typically what I do is I put the founders straight into me for the first year of them being into the business.

17:51So I can empower them, enable them and make sure that they are well served into building whatever they're meant to be building inside of the business. The second part is most of them are usually, like you said, on a mission. The reason they started five, three, depends on the company years ago, is usually because they deeply cared about a problem or they wouldn't have survived anyway. So they typically deeply cared about a problem. So giving them one, the resources to hire more people, hire smarter people and more expensive people to build with them on a problem they cared about, combined with the distribution that they can bring today to a business, right?

18:29Like 45 ,000 plus customers. that's a huge strength, right? And even if you talk to me today, like what drives me to build product is typically getting it in the hands of users and having them experience the product, give me feedback and seeing them happy to use a product. And I think that doesn't change for most product-based founders, right? People that actually love the sentiment of building. So the ability to suddenly have access to a huge user base where you can show them what you're building and see them adopt the product is a huge drive for an end of driver in general for a lot of founders.

19:04Alex, we've talked a little bit about the journey from, you know, one to 10 million of ARR, and then you got to a hundred million now over a billion dollars. I'm just wondering about the next phase of growth. And to me, it seems like the next... It's two. It's two. I'm sorry. Okay, two. No, no, no. The next step after one is two, right? That's what it really is. Okay. I thought maybe you'd grown from one to two in the time that it took me to prepare for this. Almost, almost. That's how fast you guys... Give me a little more time. But the path from one to two and then two to 10 and then two to 100, it strikes me that you might be even faster because of AI and specifically this concept of agentic software buying.

19:43So rather than at the moment, deal salespeople are going out and selling to customers like me, we use deal at Giant and saying, you know, it's an awesome product. And maybe if you're a really big customer of deal, you get taken to a football match. And it's kind of like it's very subjective. Whereas an agent from your customers buying deal, you know, based on like, is the documentation better than the competitors? Is it a better product? And is the pricing fair? Strikes me that we're going to have sort of this hyper concentration of category winners just getting bigger and bigger and bigger exponentially.

20:16Because if deal is the best product at the best price with the best documentation, software agents, AI agents will just buy that every single time. Do you feel like you're going to be a real beneficiary of that? We have UJI Talwinds in general, right? Whether it's through the operational efficiency that we're getting at the company. I don't know if you saw recently you launched a product called Akai, which is doing amazing. And it's basically our infrastructure that has helped us automate in like two months, almost 140 ,000 hours. Generally in a very complex system like ours, like AI just does wonders because you can bring context.

20:49Plus, you know, agents can actually do the work that a lot of people are doing manually today, which really changes the game. When it comes to the concept you just mentioned, I do agree with you as well, right? Like this is how you reinforce the category winners. And I think we've kind of gotten to a stage where people do perceive us as one of the category winners. So hopefully agents will too, based on one of the different parameters that you've given us as well. I'm genuinely more excited about the customer experience, right? Like I think as we've kind of grown as a company into this series of products, this full stack solution and really being the only provider, in my opinion, that can do global payroll at scale.

21:29The idea of being that you can just thousand X the experience of your customers through building a lot faster and closing the gaps that you have from an automation standpoint, that scale is just crazy to me, right? And I've always thought that we were pretty excellent when it comes to operations. This has just given us superpowers truly. So I'm very excited about this. And you can see it compounding our growth as well, right? Like if you combine this with the amount of new products that we've built and the speed at which we're able to build them today, we're seeing that compound in the revenue and we're very thrilled.

22:01That way of growing the business using AI and these advanced techniques is the future. But it strikes me that you're also deploying a tried and tested, very old school way of now getting really, really big, which is brand marketing. You sponsor Arsenal Football Club. You're using tactics and strategies which have been serving big, big companies for a long time. Tell us a little bit about why a company like Deal, who ultimately sells into businesses, small and big businesses, why you want to build a big consumer level brand awareness by doing an Arsenal Football Club sponsorship, for example, to take that example.

22:38Yeah, well, you know, I'm pretty lucky because London's been red for the last couple of weeks, which is great. But look, I think there's different parts to where the business is and where we want to go. I think we've gotten to the point where for various factors, there's a lot of value into building up our brand on the consumer side of things. I don't know if you've seen, for example, we've launched our new crypto product last week where you can earn crypto and you can basically transact in a way that you really couldn't transact on before on deal. So this shows you, we've always been very consumer oriented as a business, but that really shows you that we're building for our end users as well.

23:20And I may be biased, but I feel like in our market, companies have always missed that. I've never seen someone tell me, wow, I'm so excited that I'm getting paid on X. But when you think about it deeply, there's no reason for you not to. right because it's usually a system where you get your contract your mortgage letter your pay slips your paychecks and potentially like a myriad of features that make your life better like you know we released something called um early payday right like where you can basically anytime pay where you can basically get your your paycheck earlier for free right like all of those suites of products are very important to me because it kind of changes the statu quo of like as an hr company as a payroll company we actually care about our end users and not only about our clients So that part is very important to us.

24:10I think something that most people don't realize is, you know, the deal has scaled into enterprise over the last year plus, right? And I think a significant part of our revenue today is actually driven by mean market and enterprise. And, you know, hospitality is something that, like you said, traditional brands have understood that a long time ago. And I think tech companies are starting to follow the trend, right? Like you've seen us, you've seen Revolut with Audi, right? like at some companies are starting to follow is just that as you scale towards enterprise, it just brings a lot of value from a hospitality standpoint of being able to take customers into great, amazing experiences.

24:48And scaling experiences is something that we're going to be doing pretty heavily over the next few years. Yeah. You know, all you know, I think we, we love the partnership we have with Arsenal, you know, it's beyond a doubt the best club in the Premier League by, by far. And it's been a wonderful, you know, experience for me. I'll tell you when you're walking at the final of the champions league or in the streets of london and you see people wearing your logo on their jersey it's pretty insane i won't lie and it's probably one of the few moments at deal where i was like holy shit that's pretty crazy but the impact it's had on the brand so far is tremendous and if you can afford it uh which you know thankfully i deal with being a profitable company for over three years now then brand marketing is such an amazing thing to do and i i strongly advise funders at our stage to be able to actually invest in that I'd love to challenge you on Arsenal being the best club in the Premier League as a United fan, but you just won the league, so there's nothing I can say.