How And CEO Leif Abraham grew And to $604.8K revenue and 4.2K customers in 2019.

hello everyone my guest today is life abraham he's the co-founder ceo of a company called and co the number one freelancing software uh tool in the world which was acquired by fiverr back in 2018. he's also a partner at pre-hype adventure development firm in new york an investor in companies like row health he's also co-founded pay with a tweet which was acquired by the german company builder hands adventures back in 2013 served as director of product for west students in san fran where he worked with startups like artio and venmo has also worked as creative director at rga life was named one of the top minds in digital by ada week and earned numerous awards including two cain's uh uh lion grand prix and mtvo music awards he's also an advisor to venture capital firm urban.us and a number of early stage companies life you're ready to take it to the top of course all right man so you have obviously quite a background here so just to be clear today are you inside of fiverr working on an earn out are you doing your own thing again no no still on fiverr still running endco and we're still an independent unit within fiverr as well right so after the acquisition the entire team came over and we're still running encore basically the way we did before but with the you know support and you know infrastructure from five as well cool well okay so so by the way i paid about three invoices this morning from freelancers that i work with and used and they they send their invoices via and co so yeah you have a you have a guy that understands a product and uses the product so so walk me through is this what the product always looked like or was it different pre-fiber um i mean we've definitely done a ton of redesign since we joined fiverr but in general that's like the way you've seen the product now kind of has been also before we got acquired by fiverr so the way we look at the product really is that um is the category of freelancing software the way we define it right so if you're a freelancer you kind of have a very specific workflow of how you work right and that often is you know based off projects and if you work based of a project you for example your proposal first and a freelance contract that kind of then dives into your task management and client management then dives into your invoices and payments and so on and so that is basically that structure is something that we had built out over the span of like two years um and then you know uh yeah and then basically got acquired by fiverr like in year three like roughly within vr3 and so what was the revenue model right was it a pure play sas company or a transaction fee or what yep so the parser was a pure just sas subscription uh software that we had there and since we joined fiverr we made the product entirely free yeah now now it's easy to do that if you had trouble scaling revenue right you're just shutting down a stream that wasn't working anyway it's different if you were doing 20 million bucks in ar and you shut it off so help me understand what you actually shut off uh so obviously i can't share any specific numbers on that but um in general obviously like we were in the market for like a year year and a half with the product from there um and then like as we joined 500 meter product free it was less about hey we're shutting off this like revenue stream and more about a strategic play for fiverr right so and if you look at the market right now it's very much about land grab and so also by making the product free was is also just a strategic decision for us to be able to just grab more from the market right also focus more on the product and you know kind of like make the product even more awesome than it you know was before and um and then i have that focus point right and i think that was like the the main decision there and the other drivers really is that if you look at the freedom's market in general is it like 94 of freelance work still happens outside of online marketplaces and so the fiverr and the upwork and so are really competing within these existing six percent right now and obviously that's growing rapidly but what endcore is serving is basically all the work that you're doing outside of these online marketplaces and that's obviously the interesting thing because we are like the first piece of software that these freelancers use to basically take all that work that they basically have done like offline and through email and so on and moving it into an online system which is then also the first system where then you know transactions might happen online where you have you know your client interaction happen online et cetera et cetera and it's kind of like a first step to basically move that business into an online ecosystem so before you ever touch a market pre let's go back to pre-fiber story for a second again so on average what were freelancers paying you per month to access this suite of tools you'd built for them depending on when you sign up and what kind of plan you had it was between nine and 25 bucks a month okay so very much in kind of like small kind of smb obviously there's no big enterprise deals here right correct correct yeah interesting okay and then timeline wise you said you launched in 2015 or 2016. um we launched more in 2016 um but we launched a company in 2015 but like product-wise we were in market more within 16. okay and where was your head when you launched in 2015 i mean were you just leaving san francisco at this point or like why jump into the tool in the first place yeah so i joined this um venture firm called pre-hype in new york and um the way the partnership model there is also that every partner is technically an entity so you basically get parts of everything you're involved in and therefore technically i turn freelance just from like a legal structure perspective and so what happened there to me was that hey when you turn freelance tomorrow like where do you go right there's not like a place where i go or sign up and be freelance that didn't really exist and so how friends were running their business was basically this like patchwork workflow so i have my dropbox over here my spreadsheet over there i use like my small business accounting software like a fresh books or quickbooks or something and that's kind of how they created their workflow a little bit you know and like kind of using like zapier to stitch everything together in a way and um and that's kind of what like the what was kind of like this this like epiphany moment of you know why is it not this place where i can just sign up and be freelance and also just a tool that's specifically designed for the workflow of freelancers um and it's really just like starting with like solving the issue for for myself or ourselves like i did to take out my co-founder martin like the same issue how many people were on the team when you when you sold uh we were around 10 on the team okay and all remote or all in new york um it's like a close to 50 50. okay we're remote and then split between where um between new york um and then argentina uh portugal australia okay remote it's remote yeah yeah got it and and just and you guys had raised i believe what two million from thrive in 2016. yeah we raised close to five million dollars all together oh you raised okay five all equity or was our venture debt or is something else built in it was all all equity ross um interesting and and was all all the raise was uh the last raise was the last raise the two million from thrive in 2016 or or there was a three million after that uh the last race was from existing investors so there was thrive and uh and the other existing business i guess sorry the actual year that you raised last round was that 2016 or was it later 2017 uh that was that wasn't 17. oh it was in 2017. okay got it interesting okay so the team of 10. so walk me through there's a look there's a lot of founders that are maybe a year two years in their company they raise some capital they have a growth channel but maybe for whatever reason they want to be part of something bigger um how did you communicate the acquisition to your team um obviously i think that's a in general that's that entire process is obviously exhausting number one that's the first one but i think the other i know that i want to sell right and the reasons for you as a founder will always be different than the reason for investors for example and there might be difference for even you know um like how employees think about did all employees have some have some kind of equity do they all have options or no yeah of course of course yeah and so for us it was really the sense of uh like we basically really communicated to the team that it's happening when it was really clear that it's happening they obviously knew that we had talks and whatnot because it's a you know it was a small team at the time and specifically the ones that were in new york we're definitely aware that we have these talks right then we had to float we had to fly the television for a five-hour space and whatnot and so people were aware but i think it's also very important for you as a founder to make sure to not you know make people immediately start thinking of okay you know what would it be if this accident would happen you know what that mean for me et cetera et cetera and some of these questions about this these distractions pop up etc...