How Bigpanda CEO Patrick Salyer grew to $80.4M revenue and 20 customers in 2024.

founded back in 2012 in Tel Aviv now with offices in Palo Alto and Tel Aviv 60 folks full-time about half and half between product and engineering and then market and sales they raised thirty five million dollars have you know 20 of the fortune 500 customers but less than 500 total so between 20 and 500 customers average kind of contract value you know really hitting that million dollar mark as they help try and help these IT guys in these war room understand which alerts are important and which ones are simply noise this is episode 708 coming up tomorrow morning you'll learn from blake smith who breaks down how he's got 17,000 people using his app to safely manage their wardrobe but first here's today's episode this is the top where I interview entrepreneurs - our number one our number two in their industry in terms of revenue or customer base you'll learn how much revenue they're making what their marketing funnel looks like and how many customers they have on now it's $40,000 per Tov I haven't experienced kids have bent on global domination we just bloke are a hundred thousand units ol mark and I'm your host Nathan Laska hello everybody my guest today is a soft Resnick he's a founder and CEO of big panda an algorithmic IT operations platform that turns IT alert noise into insight unified fragmented operations enables digital enterprises to attain dramatically higher service levels part of founding the company he was an investor with Sequoia Capital where he focused on early-stage companies across enterprise software SAS and the internet sectors that's off are you ready to take it to the top I am I am thanks for having me Sequoia sounds like a sweet gig why do you jump at it out and launch big panda oh it's a good question sometimes I still ask myself that and the hardest is I ask myself why do they leave this golden cage you know I think the queues at Sequoia and it was an opportunity of a lifetime I had the the privilege to work with you know some incredibly talented entrepreneurs and credibly Talent partners but but I was young and I felt at the time boys started there at age 29 and I learned a ton yeah the one of those kind of pivotal moments in my career that you know a fork in the road and you look back and this was definitely one of those Forks in the road but after a few years a I kinda I got the entrepreneur bug and I'd been around a lot of entrepreneurs and seeing them through the good times the bad times and and I kind of wanted to get a sense for that myself and I also had a sense that having not started a company before I was kind of telling people how to drive a car but I'd never driven a car myself and so I really wanted to kind of eat my own dog food and and and that was a lot of the impetus to leave did you miss out on any deals at Sequoia because the entrepreneur was like listen I got a term sheet from the guy of Bessemer and he's built his own company before so sorry isawful I gotta go with him I heard a partner I was kind of a principal there so helping a lot of deals at the time so I personally didn't have a lot of that and you know Sequoia is a tough place to turn down but it really wasn't from a perspective of winning deals it was more for perspective of personal career growth and how does so just people that aren't familiar with how BC works you have kind of analysts and then principles and then managing directors is that kind of how was it Sequoia every form is different sequoias pretty flat but you know different firms have the kind of regimented you're an analyst and then you're an associate every firm is a little different and so how is Sequoia in pretty flat you know there's a it's a pretty flat organization with the partners do the majority of their own kind of sourcing and deal flow and due diligence and so are you and your other principal would you get piqued interest in a certain sector and go research the heck out of that sector then kind of pick a champion to go after or did you just bet on people you brought people related deals to to the other partners sure I mean I don't want to talk too much about kind of Sequoias way yeah because you know a lot of this is proprietor um it's a combination for me personally the combination of both so you definitely want to be armed with a thesis because theses are not out of the plural of thesis about where you think those opportunities across the market where you think there's vacuums that are that are right to be filled but I've never had you're not the one it's creating our companies you also have to you know it's a combination I have pieces of weathers opportunities in the market coupled with where they're aspiring entrepreneurs that are doing amazing things and do I want to partner with them so it's a little bit of both we're going to jump into big panda here in a second which is your current venture which seems like it's on a tear will dive into it but first last question about Sequoia what you d which dealer entrepreneur where you are most proud of discovering or bringing to Sequoia that's kind of like asking which is your baby love the best yeah I'll pass on that no a lot of a lot of good ones that are very proud to have been part of and some still very very good friends and colleagues sort of any of them are listening he's giving all of you Congrats but just name drawing that was really interesting for you right they just didn't contact it it did well what was there didn't expect that it did well I say probably a one that just comes to mind but I don't know if it's specially the one one of my favorites uh we invested out of Israel and company called snap to which did a very interesting company that did it back in the day when not everyone and their mother had a smartphone particularly in developing nations was able to do a lot of porting of you know mobile applications to what was called feature phones at the time so imagine folks in developing countries that don't necessarily have 4G connections and fancy touchscreen phones and they want to be able to use apps like Facebook and snap to and in Twitter and LinkedIn as well this is just a really really good job of bringing kind of modern mobile connectivity and apps to the developing world we're bought by Facebook and now are really part of the charge of leading what Facebook is doing around bringing that kind of mobile connectivity to the developing world so snaps you there you have it guys let's jump into big panda walk us through what the company does so essentially what we do at a very high level is automate the ability of human beings and IT operations to keep up with a data center that's radically evolved so think of the folks in IT operations so the world spends over a trillion dollars a year in IT operations and in very very broad buckets you can think of that in three very very big buckets folks who build and scale software folks who build and scale infrastructure and then folks in what's called service operations that actually have to of all that software and all that infrastructure running those can be called network operations engineers what's called the NOC they can be called DevOps engineers they can be called site reliability engineers a very very big chunk of all that IT expand is towards engineers that actually have to keep the lights on and if you think of what's been happening in the data center around hey I've got to keep this software and this infrastructure running but that software and that infrastructure has radically transformed over the last 15 years so think of if I'm a large enterprise one of years ago I was buying the majority of my stuff from a handful of large vendor I was buying it from IBM and from Oracle and from BMC and CA and maybe HP and that gave me the lion's share of my systems my monitoring tools up and down by stack and so from a from the perspective the folks actually have to keep the lights on it had just a handful of tools you had data centers that were comprised of you know several hundreds and several thousand servers in your basement and things moved really really slowly and so you know that let me ask this to different can you tell a story about a custom pote obviously I'm sure you have NDA's on some of your customers is there a specific customer you can name and actually tell me how they're using big panda sure let me talk about let me not name a fortune 50 company who's a customer of ours very large networking company came to us and said hey 20 years ago all we sold was networked machines and routers and switches and so forth but today we're services company we've got lots of staffs offering to lots of different companies and we have to make sure that those SAS offerings I give a give the kind of SLA that we've promised to our companies actually guys is a service level agreement so this level agreement so if I promised some large multinational bank that I'm going to have 9th I'm going to be up available 99.999% of the time well I better better do that and to actually keep that stuff running I have to keep track of the same company has to keep track of hundreds of applications that are running on tens of thousands of servers and and VMs virtual machines in 24 different global clouds I've got teams of engineers in the Ukraine and in San Jose California and in India and they're using 15 different monitoring tools to figure out what the heck's going on imagine you're the poor Schmo that's sitting in kind of this war room coming to work with 15 different monitoring tools and you've got 70 thousand different events that you have to keep track of and you have to understand hey within those 70 thousand different data points about the health of every nook and cranny of my IT stack is a potential problem that means my big customer who's got serious s LA's is not getting the quality of service that they expect that's a really big problem and the amount of stuff that those engineers have to look at has become a big data issue stop it are you are you only kind of when incidents start happening and it says note our specific database or certain occurrences you kind of help be folks in the war room quickly figure out if this is something that's correlated like an attack or if it's not related it's just regular kind of system performance is like our is a reactionary or preventative it's both it's very much both so right now the way it is is imagine you're during that war room you've got 70,000 different awards and we know 1% of those awards are really important and the other 99% are just noise go filter that go filter through that at any reasonable time so what we do is we use a lot of machine learning and dynamic clustering to say hey mr. or mrs. IT operations you don't really have 70,000 alerts you have just a handful of core issues with lots of symptoms but you don't have to be a data scientist to figure that out and you may tell me what annoys alert would sound like so what would it actually say it's not important but it still takes up a ninety person's time because it hit their an inbox great question okay so I've got in a word that says that server number one two three has uh has used up the majority of its memory or it's got low disk i/o or something that that's not that's a problem now is that a problem well it's a problem if lots of other servers in that cluster are also experiencing problem and then it's only a problem is that cluster services some kind of critical application and then it's really only a problem if a customer is have it who relies on that application is having a crappy user experience and to piece together all those problems I've got to look at fifteen different monitoring tools and spend an hour or a day connecting the dots just to figure out is this problem with my server something that I should be concerned about or can I move on to something more pressing so I'm over simplifying here drastically but you're basically a very a much sexier version of like kind of if-then statements coming through alerts in other words if there are ten servers in this whatever stack and nine of them are almost full and the tenth is give me alert that is almost full I know if that last one gets filled up it becomes a big issue because it's a critical part of our application and then that part goes down it's kind of if this if this if this and then that's how you decide what alerts the surface is that accurate is somewhat accurate the the only thing I would add to that is the if-then statements themselves are dynamic gotten can't come in there and say hey if I had unlimited human resources they could come in and write 30,000 if-then statements and would that be the same thing no because those set of if-then statements look very different on a Tuesday that they would on a Wednesday yep these IT environments are changing so quickly yeah we're all over head well you're you're educating me here and I'm very curious no not just as we're running out of time let me ask them grant a rapid-fire business-related questions here sugar what year did you launch in we launched in 2012 okay what's your model like how do you make money that pay-as-you-go with its ass what so we're SAS offering so we charge by an annual subscription fee depending on how many virtual machines or containers you're using so basically a but how big is the company how big is their your footprint yeah and are we I mean are we talking I'm making ISM are we talking ten grand per month or a member or ten grand per year or a million per year give me some kind of range no we're talking much more towards the ladder no towards the latter end we come in we cater to very large enterprises we often time can save them millions of dollars both in terms of headcount efficiencies via automation and in terms of improved performance of their offering got it so high high six figures I imagine you have some contract to probably break a million bucks easily if your statement someone ten twenty million bucks right all right okay and and these folks what's your team size currently right now I think we're about sixty people and how much have you raised woo we have raised to date oh but almost thirty five million dollars explain to me the strategy behind doing kind of initial large close on a Series B and then almost a year later adding five million on top of that strategically why do you do that assuming my research is correct and that's what you did sure oh it's very tactical uh you know we originally done a series B oh gosh when was it I guess it was back in mid 2015 I want to say and at the time you know we were fortunate enough to have multiple term sheets and we ended up taking a serious B with with you know a great partner you know our partners today include Sequoia and Mayfield and battery and we were fortunate enough to have multiple term sheets so at the time you know one of the investors came into the hey can we add a little bit more money and at the time you know we didn't really need more money I didn't really want the dilution the Sun was shining in the VC environment and then towards the end of 2015 you know people started downgrading the value of snapchat and all these other unicorn and and people were thinking that winter was you know rain clouds were forming and people were thinking that winter is coming again in the VC environment and you know turns out later that after a year looks like the rain clouds that disappeared by the time we didn't know so we had an opportunity to bulk up the balance sheet by another five million dollars and when I saw rain clouds form I think I said hey no maybe it makes sense to get a winter coat from a capital perspective just have a you know a healthier balance sheet it was a you know very uh pragmatic move sometimes when you see this kind of pattern in terms of capital raising it's either what you just described or others sometimes they'll go try and raise their next round right at sea round and it won't get evaluation they like so they'll say you know let's get a quick bridge here right to keep growing the company grow evaluation and try fair Series C later with that line of thinking at all included in getting that five million dollar winter coat no because this was very much you know it was just a few months after we had already done the series B so we had plenty of pipeline though my research is wrong there I thought that was over I thought it was over a year later though Oh got it okay good so it was like you had the round open with it on the same terms you just had an open basically an open round and they just maximum closed the other others pile on very quick awesome very good okay let me see here you guys are all location wise or y'all based in San Francisco no so half the company's based in Palo Alto and then half the companies based in Tel Aviv so we started a company in Tel Aviv and all of engineering's still out there so I was living in Israel at the time this is just a very very strong pool of Engineers out in Israel and it's not the kind of feeding frenzy of a hiring market that you have here in the United in the Silicon Valley so we started there built just a very strong team of engineers and when it came time that I felt that hey it's time to start engaging the market I moved out to Silicon Valley to start the headquarters and so at this point we have sales and marketing and products out in the valley and engineering and back out and out in Israel and then give assistance obviously the company I mean you're progressing nicely launched many years ago over 35 million bucks raise team about sixty is that breakdown sixty what percentage of those folks are engineering versus kind of inside sales and marketing is probably about half half I say probably half of the people are engineering and product and the other half or more go to market oriented so you do have a playbook you're actively executing around selling to these IT departments really inside sales people on a comm structure I mean right is that accurate or no you have to have a playbook in order to scale absolutely some people that do well I will tell you I've talked to a few people that have pretty significant kind of stats business that sell into IT and they really actually don't have a playbook because it's all utility driven when they add X amount of nodes they know the product is going to drive extra usage and the upsells actually very natural some people have inside sales people calling in to drive expansion ARPU so I was curious what your model was no no we're very disciplined about it especially since our sales model is not hey let's sell you five thousand dollars and then let's grow every month we come in and say hey let's do a 100 to 1 billion dollar land one hundred thousand to 110 million dollar land and then a multi-year contract and those are much more deliberate deals yeah and then before we wrap up here give me a sense of kind of company size we obviously have number employees but how many businesses would you say are paying you today and give a range if you're not comfortable with a specific number yeah I'd rather not talk about sales and kind of customer the number of customers but you know we cater to the largest fortune 500 companies in the world so we have you know probably at least 20 companies today in the fortune 500 and then you know a large number of kind of medium-sized enterprises as well I mean you don't need this is not a low our business you don't need thousands of customers to really build something special here so I mean I'll put a huge range its birthday of less than 500 customers yes okay perfect great yes 500 customers if you have 500 customers you million-dollar receiving is right and I think you're picking up to a steak dinner not that happening right all right guys I talked about this earlier but I scheduled like so many meetings of a below your mind I mean all my blood gets interviews right one hundreds of munch bars I talked to monthly I scheduled and you know what I do it so efficiently I get them all to agree to my calendar so all the calls are back to back to back that means I'm not switching in between tasks all day long I get them some batch so I can be very efficient it's so critical to use a tool called acuity scheduling to do this at Nathan Walker calm /schedule it eliminates back and forth between me and people I'm trying to meet with and makes it very simple and most importantly they helped me keep my no-show rate very low because it's enough reminders helps you look very professional so go to Nathan Baca comm /yeah you'll just sign up and you get a great deal you know you guys know that I hit people hard if I make great deals and gather the CEO has given us a great deal if you sign up like normal people okay on their website you only get a 14-day free trial to use my link makes monkey dogs onboard flash scheduled to get 45 days free ok it's the best it's free but an ape like a.com for class schedule right now to sign up and I'll see you there alright a lot with wrongful favor the famous five number one what is your favorite business book oh wow okay I wasn't prepared ah the gold it's about feeling of constraints just a really really wonderful book about nothing to do with high tech but really around how to create kind of efficient processes by always focusing on the primary bottleneck we could spray at any one time number two go is their CEO you're following or studying currently no does not okay number three what's your favorite online tool like acuity scheduling my favorite online tool interesting [Music] probably quick this was recently bought by Salesforce number four how many hours of sleep do you get every night you know it's like that famous saying for entrepreneurs I slept what I sleep like a baby at night I wake up every two hours and cry on average witty yet um probably around five our fourth and what's your situation married single TF kid I have I married with three children oh my lord how old are they five three and five months oh my gosh you know entrepreneur no entrepreneur I don't good night well listen hopefully like 5-10 years they move from a liability into an asset because you can employ them for very cheap and they help build your business right that's alright five month old is already coding consider me take a good coders here that's amazing alright and how old are you oh me I'm old I'm 41 okay last question take it back 21 years what he was your 20 year old self new Wow this peeps on top of the questions what do I wish um you know I really have no regrets I took you know out of college I worked but I took a year off of wide traveled in Central America and in India for for a year or not it's like you regret though just wisdom you gained is there nugget you would give back to your 20 year old self to speed up that learning curve you know not off the top of my head maybe they're kids what do you tell your older your eldest kid when it comes to just life in general don't eat so much dessert and brush your teeth he's five years old yeah I don't know it's a good question probably in retrospect I say maybe [Applause] you know I'll say this I think in my 30s I was had a I was an employee throughout my 30 and only later into life as I joined Sequoia and started my own company that I really started thinking as an entrepreneur and one of the things that being an entrepreneur forces you to do is take off the blinders because the end of the day everything comes down to your judgment call and you have to be able to make judgments very quickly with imperfect information and that's a muscle memory that you have to be able to learn and we as an employee oftentimes you're not forced to make those very quick judgement calls around a broad number of things and a broad number of our range of different kinds of people I would say probably starter companies there you guys have it from the founder of big pants off he would have he would have started thinking earlier as an entrepreneur started a company earlier again the company doing well founded back in 2012 in tel-aviv now with offices in Palo Alto and Tel Aviv 60 folks full-time about half and half between product and engineering and then market and sales they raise thirty five million dollars have you know 20 of the fortune 500 customers but less than five hundred total so between 20 and 500 customers average kind of contract value you know really hitting that million dollar mark as they help try and help you I see guys in these war rooms understand which alerts are important and which ones are simply noise that's not thank you for taking us to the top all right thank you if you enjoyed us out today go back to listen to yesterday's episode with Manny the government has given empower to let non-accredited investors invest if the first time this happened