Jul 7, 2017 · 34m · saastr
How to Break Out and Really Scale
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this discussion hosted by Bain Capital Ventures' Ajay Agarwal, Optimizely founder Dan Siroker shares key insights on building a category-defining software company, detailing how product-led innovation, disciplined cultural codification, and outcome-oriented management enabled Optimizely to disrupt legacy incumbents and scale.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
Jason as informed peer 3.6 Guest teaching 5.0 Guest disagreement 0.9 Jason pushing back 0.5
speaking balance: gold is Jason, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 29:58 Dan dismisses the host's congratulatory premise
Dan immediately corrects Ajay's premise that they easily pulled off a second product, detailing the painful internal mistakes made along the way.
Hardest push from Jason ▶ 26:39 Dan enforces boundaries against legacy playbooksDan strongly rejects allowing new enterprise hires to justify practices based on how Salesforce or Siebel operated in the past.
Biggest teaching moment ▶ 11:26 Dan breaks down the mistake of horizontal generalizationDan teaches the audience and host that their horizontal approach was actually an unconscious failure to deeply solve vertical customer problems.
Jason holds their own ▶ 23:17 Ajay highlights rapid go-to-market metrics from Series A diligenceAjay references specific early metrics, noting Optimizely's rapid three-to-four month payback period and non-traditional top performers.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Jason as informed peer | Guest teaching | Guest disagreement | Jason pushing back | Why |
|---|---|---|---|---|---|---|
| Differentiating Against Incumbents and Empowering Marketers | 4 | 5 | 1 | 1 | Ajay sets up questions highlighting how Optimizely competed against giants like Adobe and IBM with non-technical marketers. Dan explains how understanding the practitioner problem enabled them to carve out a product-led wedge against Adobe's complex suite. | |
| Capital Efficiency, Product Evangelism, and the Visual Proxy Editor | 4 | 4 | 0 | 0 | Ajay asks about Optimizely's capital efficiency and early try-before-you-buy proxy engine. Dan details how weak initial content marketing forced product virality and word-of-mouth evangelism through the visual editor. | |
| Series A Inflection and Navigating Horizontal Versus Vertical Strategy | 3 | 6 | 2 | 1 | When Ajay asks whether going horizontal was a conscious choice, Dan candidly reframes it as an unconscious mistake, admitting they should have focused earlier on specific vertical problems. | |
| Managing Growth Paces: Building a Rocket Ship to Go Far, Not Just Fast | 4 | 5 | 1 | 1 | Ajay probes how to manage breakneck growth without crashing. Dan deconstructs the rocket ship metaphor, arguing startups should prioritize going far and building enduring foundations over pure velocity. | |
| Codifying Company Culture: The OPTIFY Values and Jordan's Story | 3 | 5 | 0 | 0 | Ajay asks about the origins of Optimizely's OPTIFY culture framework. Dan delivers a detailed narrative of codifying culture to eliminate vague hiring criteria, illustrating the values through an engineer's public accountability. | |
| Scaling Cultural Behaviors and Reinforcing Values via Storytelling | 3 | 4 | 0 | 0 | Ajay asks how cultural standards scale from 40 to 400 employees. Dan explains the critical distinction between invariant core values and adaptable day-to-day communication behaviors. | |
| Go-to-Market Evolution: Unproven Talent and Analytic Pricing Iteration | 4 | 5 | 1 | 1 | Ajay raises the shift toward enterprise accounts and hiring pedigree. Dan pushes back against copy-pasting legacy enterprise playbooks, advocating for hungry unproven talent and disciplined pricing experiments. | |
| Multi-Product Expansion: Personalization and the Startup Duck Syndrome | 4 | 6 | 2 | 0 | Ajay compliments the company on pulling off a second major product line. Dan pushes back on the celebratory framing, detailing the missteps made in devaluing their core product and over-investing before securing reference customers. |
Statements from this episode (17)
Optimizely became the top website optimization platform globally by 2012
“So in 2012, ah, we became the number one most adopted website optimization platform in the world. We actually had Obama And Romney using us extensively, which is great.”
Siroker: Optimizely operated without multivariate testing for a year and a half
“We didn't have features that people assumed were, ah, must haves, things like multivariate testing. We didn't have that for a year and a half.”
Siroker calls Adobe's marketing cloud a poorly integrated 'Franken-suite'
“Adobe you know, has a product that, you know, has been evolved through acquisitions, which turns what they're offering into what our customers tend to describe as a Franken-sweet. It's a bunch of products that don't really integrate well with one another.”
Siroker: IBM has hundreds of non-developers running daily tests on Optimizely
“They've seen 70% of the decision gets made before sales person is involved. So they use Optimizely. They've got a team of hundreds of people doing A-B testing, optimization every single day that don't require developers to be involved in the process.”
Optimizely hit a $10M run rate before raising a Series A
“Dan raised a series A when I think you were already ten million dollar run rate. He went from a million to ten million on almost no capital.”
Siroker: Optimizely proxied websites to let non-technical users test changes
“If you haven't implemented Optimizely, we would actually proxy your website and inject Optimizely into it, so that you get that sort of visceral magical feeling of making a change to your website without requiring a developer.”
Siroker: Optimizely would have benefited early on from vertical focus
“If I had to give myself advice to a past version of myself, I think a lot about that, and I think about optimization. I think that it would have actually served us better to be more narrowly focused on a set of customers and deeply empathize with their biggest…”
Siroker: Founders should pace growth for longevity, not headline speed
“Make it a conscious commitment, not an unconscious commitment, to grow at a pace that enables you, ah, to build an enduring company, not just, you know, one of the top fastest growing companies of the year.”
Siroker personally interviewed Optimizely's first 100 hires
“I interviewed the first hundred people at Optimizely, and that means I also interviewed probably the other, you know 209 hundred, whatever people that we didn't hire.”
Siroker: Codifying company culture early creates hiring consistency on 'culture fit'
“Why did we start so early codifying our culture? It started really with this pragmatic need to be consistent. We would interview a bunch of people, ah, on a day, and at the end of the day, the interviewers would get together and do a sync meeting. And soon I'd…”
Siroker: Job candidates heavily focused on titles are a massive red flag
“We try to seek missionaries, not mercenaries. So people who are really focused on title as part of that process, ah, to me is a red flag. It means that they're about trying to make their LinkedIn profile look good, not how to make our customers wildly successf…”
Siroker: Company cultural behaviors break as headcount scales from 40 to 400
“Now, the values are different from the behaviors. The values of transparency, for example, I think are pretty, ah, universal. Behaviors within the organization, such as an early one that we had, which was that every time we'd have a meeting of two more people …”
Optimizely boasted a three- to four-month payback period at Series A
“I think when we invested at the A, your payback period was three or four months.”
Siroker: Hiring hungry, unproven talent beats hiring for resume pedigree
“I'd rather somebody With a chip on their shoulder, who wants to have an opportunity in our company to prove that they can do great things, ah, than somebody who has the pedigree or resume that says they've done it before.”
Siroker: Optimizely remains heavily underpriced relative to customer ROI
“I think early on, ah, and still, even to this day, ah, we're very underpriced. People look at our product and, you know, when they're thinking about renewing, they're looking at the millions of dollars of Lyft they're getting, ah, and maybe the hundreds of tho…”
Agarwal: Most SaaS companies fail to build a meaningful second product
“If you look at the history of enterprise software and SaaS companies, you know, most companies rarely build a second product, you know, second product that's kind of as meaningful and as big and has as much potential as the first product.”
Secure six paying reference customers before scaling a second product's go-to-market
“Looking back, what I would, wish I had done differently is, is have a small team of folks working on getting six reference customers who are using the product, paying for the product, and are willing to be public spokespeople for the product as a way, ah, to r…”