How HoneyBook CEO Oz Alon grew to $74.2M revenue and 55K customers in 2024.

foreign welcome back to 33 Founders I'm really excited that you're with us today because I'm here with Oz and shadia two of the co-founders of honeybook thank you guys so much for being with me thank you for inviting us thank you so one of my favorite things about honeybook is that your mission is to create Magic tell me how you're creating magic for users who are coming to plan an event and then for a partner who's coming to list their services on the site oh man you started good uh that's definitely our favorite topic creating Magic uh you want me to start are you gonna take it I think you should take this one you own the magic around here um so it's it's interesting you know we look at the events industry in general and we see how how you know every vendor in this industry if you look at a photographer for example promises his customers his clients that he's gonna you know he's gonna take beautiful pictures of the event he's going to document the event and actually that's very true the photographer in the event is gonna own your memory if you look two years back on your wedding day whatever you you remember is actually these beautiful photos Beautiful Moments so when you think about it this photographer is creating magic he's going to create your memory and then when you look at a florist it's the same thing right the florist will look at the concept of the event and we'll we'll in the end of the day we'll we'll choose like the right flower with the right color in the right like um a smell that that will make the the entrance this event uh an amazing experience so when we see all these vendors promise and and deliver magic to their um customers then we can't not notice the fact that at the very first moment when they meet with these customers uh the interaction and communication between them is far from Magic it's evolves contracts and signing them and sending it you know through email um and then it involves checks and cash printers and taxes and it's like it's exactly the opposite for Magic and this is not a world that we want to live in right and it is not a world that we I used to live in like I don't even know how to write a check um I just don't do it so when we went through this phase of getting married and that was kind of our entrance to the events industry which is you know the wedding is just part of this industry but but what we discovered is that we need to go through all this weird outdated process and when we we sat together and talked about it and we noticed that it's far from from Magic um we decided that we're gonna change this and we're gonna create Magic from every single part of this process from the booking through the planning through the events itself and and this is that's kind of our mission in the end of the day can you give us a couple of the events that you guys have helped your partners host because the pictures are gorgeous on the site yeah so we're um we're not necessarily we're an extension of the vendor right and of that entire process so while we're not on site and we're not necessarily responsible for being there on the day of the event um uh we we do help to enable the entire planning and collaboration and communication communicating process that happens to get to that magical moment right so for example we know that a lot of our customers who are um event professionals you know they're they're planning um you know corporate of uh Galas right they're they're doing um um non-profit fundraisers they're doing weddings they're doing birthday parties so any and anywhere where you have a lot of different um vendors um coming together to create this awesome um experience for the client honeybook is helping those vendors along the way great so what would you guys say are the top three problems that your customers are facing in that light and then how do you help them solve it so when you ask about our customers it's first of all we need to Define who are who is the customer and our customer when we looked at the events industry you know we look at the 300 billion dollar industry one of the biggest industries in the US but what was interesting is the Dynamics of this industry and the Dynamics was that the vendors the sellers in this industry are calling the shots and not the buyers this is very different from every any other industry and the reason is very simple the buyers normally are doing it you know once a year if it's a corporate or once in a lifetime if it's a wedding so when you do something once in a lifetime and you meet a vendor that does it every week you're not going to influence the way that he's doing business therefore we understood from the very beginning that our customer has to be the vendor has to be that person that does it on a weekly basis so when you ask um an example of how we solve our customers needs so that's again that's a very interesting question because we needed to Define what are these needs that are common to all the different vendors and one of the needs that we found out from the very beginning was actually you know managing these these clients the end clients the brides or corporates or Galas that that need attention from the vendor in the booking process so generating proposals signing the contracts getting paid from all these different clients making sure that I have leads that are coming in through my website and that I can track them and and making sure that I you know give the attention to this customer that requested my proposal so these kind of things you know from the get-go were were the pains that we solved at the very beginning and again obviously that's just the beginning because moving forward we're looking at the scope of all of the relationship between the vendors and the clients and even the vendors and the vendors which is another very interesting aspect of what we're doing which is you know tapping on the ecosystems of the vendors and their Networks how did you guys figure that out I love how you put it that from the outside so for me I would perceive that you're that I'm your customer because I'm coming to plan my event via honeybook to get connected to all these vendors but you guys learned early on that you really needed to Target the vendors what was that learning process like um well actually so for the the learning process was very personal but first I just I just want to clarify that as let's say you as the client you don't come to honeybook to plan your wedding right um right now there's there's not a way for you to do that what it is is that is that where we work with the vendor we then the vendor uses honeybook we enable the vendor to now communicate with you as your client right so if you're lucky your vendors will be on honeybook and and it's actually our job and our duty to make sure that all of the very best vendors are using honeybook so that so that next you know next year or two years from now when it's time for you to plan your next event you are going to ask these vendors are you on honeybook and that's actually going to mean something to you right it's going to be a stop of approval but let me go back to your question about how we were inspired so it was it was very personal right we um like how did we realize that actually that the consumer doesn't have a lot of power in this play well because I was married um to my husband and then Oz was married to his wife Nama who's also our co-founder um and and we we you know we sat down around coffee one day and we realized that the pain points of planning our own weddings were so similar mind you they got married in Israel I got married in the U.S we both plan our own weddings and we found the pain points were exactly the same and we thought how could it be and and we weren't the only ones right our friends anyone you go and ask they will moan about the fact that it's such a complicated outdated Antiquated process to just work with the vendors right The Wedding Date is beautiful but what about like the 9 to 12 months of schlepping through papers and emails and phone calls and faxes and so on so we thought gee if if all of these millions of consumers each year are moaning about this why why are things the way that they are what happened to the events industry that I got stuck in the 80s so that's when we started to examine the Dynamics here right we realized the vendors are at the core of the industry this is their livelihood they're doing this day in and day out and we went to the vendors and we asked them you know why don't you accept online you know I want to pay you uh with uh with I want to pay you by credit card and we've seen that vendors are reacting back and saying oh I don't do that and again you know it's just it's not that they that that the events and weddings Etc it's like it's on a different planet it's at the same day exactly that you would never think about paying something with cash like something else at the same day exactly you you or with a check you meet a vendor and suddenly you pay with a check and it's and so that's so that's how we came to a realization that probably the vendors are the ones that that kind of uh influencing this great so I want to shift gears for just a couple of minutes and talk about your journey to get where you guys are today so you started from Israel and you decided to come to Silicon Valley I'm sure that was a hard decision why did you decide that you needed to come and you needed to be here in this ecosystem um so in Israel you know we got married and and after the wedding we start thinking about these things and and thinking about you know Israel is a very small uh Market uh it's only seven million people it's in this it's the size of New Jersey so if you want to really build something big and influence you know people around the world you can't like we we believe that we have to understand that it's not only our pains you know it's it's it's other people in the world are having the same pain it's not just an Israeli thing and we met someone in Tel Aviv that had this program in Palo Alto and he said look if you want um by the way his name is gilberti and the program was up West lab and and Gil said look if you really want um to see how it works in the rest of the world and obviously you're going to Target the uh you know the American industry you should ASAP you know hop on a plane and be in Palo Alto and you know and meet your Market there and when we moved to Palo Alto uh which was a week later uh you know uh we met charya that like the following months and we sat together and we talked about our experiences and and it's we met through a mutual friend uh that connected between us which by the way is something that happens a lot you know in in Silicon Valley and this ecosystem of paid forward and connect people and we were sitting in I think it was Venetia yeah Palo Alto very famous um on the second floor and we were talking about our experiences and Shadow just got married and and we just noticed immediately that you know I think a few things just popped out one was we both had Excel sheets you know and we were very um uh proud of our Excel sheets uh very comprehensive and then we both had all these contracts and we both paid with cash and checks and that was our aha moment you know it's the whole world is like that it's not an Israeli thing and and and we just decided okay let's combine forces and let's start and this is kind of where you know at this stage we went we raised our our Angel Money uh the seed round and and we kind of started out and started experimenting on the industry on the market and trying to understand okay so where do we start and this is how we got to the realization of what we talked before about the fact that the vendors are ones calling the shots what was it like your fundraising experience because that was pretty soon after you arrived in Palo Alto right yes um so uh it was it was a very interesting experience lots of tough moments where we felt that it would never happen and you know mind you uh we didn't like I didn't I didn't come from this from this ecosystem of startups I didn't know that I want to build a startup I thought that I'm gonna that I am gonna build a company like a business now that I'm gonna uh build a product and we're gonna sell it and and I never and someone sat down with me and said you know what Oz you need to raise money and I said what do you mean I need to raise money and that person said well you go to an investor an angel investor that was the first time I heard the term angel investor an angel and this investor will give you a hundred thousand dollars and I was amazed I was I was looking at him and and first of all I thought he was mad but secondly I'm like okay why would someone give me a hundred thousand dollars and he said well because you're gonna give him part of your company that's it okay so what which part exactly and he said you need to give them like 30 of your company and I thought like holy crap like the company is worth like 300 000 this is crazy little did I know you know a few months later we raised uh one point I think one or two million dollars and and that's um and today I look back and I laugh at that but the but going into the phase of raising the money um that was an experience of learning that it's not about going to investors and explaining to them that I have a great opportunity but it's about getting to know the investors and building your relationships with them and finding the right people that one connect to the vision like they don't connect to the fact that it's a great opportunity they connect to the vision they want to be part of this Vision they believe that the world should look the way that you want it to look you know and they are and they're willing to give their time you know more than their money it's their time to to kind of work together and do that and get there and secondly that you have this personal you know Chemistry Between you that you want to spend time together one of my of our investors and the one who led the uh this feed round uh was Bobby land and Boris plutonic which their Partners uh in the Usman and Boris and I meet once every two weeks for lunch you know ever since two years ago um and and that kind of relationship you know you want to make sure that it's an investor that you want to spend that time with at the same round exactly we had James Courier who's an amazing advisor and investors an investor of us of ours and um and we spend a lot of time together you know strategizing is that a word absolutely um it sounds like what you're saying is that you're going to marriage with these people exactly let's hope that you like them yeah enough to see them every day uh but I think that again and and if the audience to this are um entrepreneurs I would say that you know the first shift um is to understand that we're not raising money you know going to investors Angel Investors and telling them look you know I have this great opportunity for you you're gonna you're gonna invest a million dollars in one day you're gonna have a hundred million dollars they couldn't care about this um most of them have enough money you know to the extent where it's not going to change anything in their life you know they're gonna they're gonna have the same life and most of them are actually modest people that you know um just have a very casual Life Style so it has to be about something else and what we found out it was about the chemistry and and you know sharing Vision Etc and this is something that I would say that every entrepreneur needs to understand like the sooner you understand this um the better and you know and the chances are higher that you will successfully raise money once you have that chemistry with someone what are the next steps so the next steps are that uh the chemistry you know you have the chemistry when you see that that person wants to join you that that person says hey look you know um I really enjoy working together with you I feel that you know I love where this company is going I love the team um I want to work with shaded you and I have I have all these ideas I can't sleep at night you know I really want to be part of this and when you hear that from an investor you understand that's true serious and you know and he wants to be part of this and then and the next steps are to say okay well you know we are raising this amount of money um uh for this evaluation and by the way you know we all know that the valuations it's just it's a fiction right in the end of the day um it's we're raising this amount of money and probably you're gonna take 20 of the business so if you raise a million dollars you know your valuation is four million dollar pre-money um so it's not it doesn't really matter the valuation of what does matter is that this is what the company needs and and if they come in this is what they're gonna get they want to own a large you know um uh share of the company um to be a large stakeholder so the next steps will be the the investor will say okay this is what I want to invest um maybe I want to take the whole you know the million dollars and then the entrepreneur will say okay so what let's look at this and you can bring this and that to the table however you know we would need a lot of help with you know with the network um maybe we'll need PR maybe we'll need Partnerships and the investor will say well I can help a lot with these these Partnerships but with PR in the network I'm not sure that I can help with I can't help um recruiting for example so then um a smart entrepreneur will say okay and a smart investor of course will say well let's you know let's not invest the whole Million by one investor that's like that's that's invest eight hundred thousand dollars and leave two hundred thousand dollars for other investors that can come in and help and that will be a very smart move of an investor and an entrepreneur where they say okay you know we're gonna do this round it's gonna happen and we're going to live leave this amount we're going to take out time to look for the right partners that can really help the company so then when you moved on to your series a and your series B did you have not necessarily individuals as a person but individuals with a certain skill set in mind for what you needed for honeybook um out of the investors in series and series B yeah when you were going to raise your series a in series B did you know that you were going to need some investors who had specific expertise so I think the series B is a very good example um where we knew that honeybook is going to be very like it's going to invest heavily on the transactions and financing side of the events industry and when we look around one of the most successful IPOs of 2014 if not the most successful was Lending Club and it's a company that does peer-to-peer lending with a lot of transaction volume and financing going on and when we looked at this company that I knew for the last year or two and I was even kind of obsessed about this company which I really like um we looked at who invested in this company at the early stage and one of the investors who was very dominant in this company was Jeff Crow from no West Venture partners so for us to partner or to be able to partner with someone like Jeff Crowe was a huge thing so these these were the kind of investors that we looked at we wanted Partners like Jeff to join our board and because we knew that he would understand so many of the challenges that that we have and we were very lucky to to end up with getting Jeff to join the company um but that goes back to the to what we talked before about the chemistry and working together uh I have to say that and and sharing the vision together so when you look at at the investors that joined us in series day it was Michael Eisenberg from LF um and Michael is helping the company a lot just just I think two hours ago shot asked uh you asked if uh if Michael can help us recruit this specific role that the child wants to recruit for and my response was wait but we can do it too why do we need Michael but Sharia and I are so used already to all this help that Michael is giving us that we're like okay let's use Michael for that too he's so successful with finding us people um but what's interesting thing about Michael and then Jeff is that when Michael invested his theories a he was going through planning his daughter's wedding when Jeff invested in series B you know surprisingly he was going through planning his daughter's wedding so when you look at sharing the vid like understanding the vision and wanting to be part of something you see that in both cases these these investors um understood they understood the vision they want to be part of this but then when you look at the chemistry both investors spent a lot of time with us I can easily say that with Jeff in the series B we probably spent at least 30 hours together wow um wow talking a lot you know Jeff came to to our office at least six times if not more uh he spent time with the leadership leadership of this company he spent a lot of time together with me we went for dinner a few times and for drinks and and with that that chemistry that being built and the fact that he understood the vision he connected the division we felt very comfortable working with Jeff we wanted him on our board um the these this is what you know in the end of the day notches the the round to a series B okay that is the best description of fundraising I've heard I feel like I just went to fundraising 101. thank you I think that's another way of saying you talk a lot yeah I do okay it's a good way of saying you rock I really appreciate it so the next part you mentioned one of the things of fundraising is making sure that you guys have the chemistry and that the investor shares your vision so obviously sharing of the vision is the same thing that's going to translate when you're bringing on new team members what's your experience been like hiring and how do you know when someone really shares your vision because you guys are such a tight-knit group of Founders how do you know that someone's going to share that passion well we have invested a lot of time and we are becoming much much better at interviewing so I'm just going to be really practical about this about this answer and say that we've learned a ton and our learning curve has been like this and being able to to Really zero in really quickly and the more and more interviews that we are the more and more candidates that we interview you understand um how it is that they operate but I think they think that having um uh well thought out interviews um is it is really revealing um I also think that the the other thing that helps us to um guide our decisions in hiring people is that we have five core values and they're really obvious to everyone right it's people come first we are fearless we go the extra mile we love what we do and we are family and and if and if any one of these like any one of these core values typically resonates a ton with any given candidate right like any candidate comes in when they hear the five they say you know what I absolutely love the fact that you say that you put people first right and then we start to tell me about that and that and then that's that's when you get to know immediately whether a person is is not a is a good fit not just skills based right are they competent are they going to be awesome at this job but can they actually connect to something that's so intrinsic um in in the culture and in the DNA of honeybook so we we use the five core values a lot to um have conversations with candidates when it comes to the core values and so let's say you're interviewing me and I really identify with one of the values but I don't have exactly the skill set that you're looking for will you take a risk on someone or is it better for Founders to find someone who has like equal skill and equal passion um so it's so it really depends on the face of the company and where we are at exactly um I like to say that every month I feel like I work for a totally different company and it's really true so at the beginning we optimized on journalists or um generalists generally journalists um who you know can do many different things and we didn't really care about the specific experience of something because we knew that we don't know what we're going to do tomorrow morning no it's gonna it's gonna shift It's Gonna Change um but what we're finding out is to today when we have you know a sales team and a sales development team and and customer experience success support Community um suddenly we really need these skill sets that we don't have you know um for the same reason I didn't even know that I should raise his money there's so many other things we don't know and I think the most important thing more than anything else is what China defined as the learning curve that we have with every single thing so again as you look at the skill sets we put a lot of a lot of a lot of emphasized on the culture fit and this is something that is extremely important for us but at the same time today we're in a in a point of time of time that we just we can't compromise on the skill set totally and as the company matures it becomes more and more important that we are able to narrow in on what that specific need is and have extremely high standards for somebody uh to come in and be able to totally deliver on day one great on the note of not knowing what's going to happen and feeling like you're working for a different company every month shradia you've shared before that every day is different for you as one of the co-founders of honeybook and I'm sure the same goes for you Oz how do you deal with that just personally because I'm trying to deal with that and it's not that fun there's some parts that I don't like well I'll tell you what I just spent two hours on the phone with Oz yesterday on a Sunday and we were just like just shooting the and kind of bitching and whining a little bit and so one of the things that you do is you you kind of lean on your co-founders right because you're all you're all going through really similar things of course as the company grows like our and our teams get bigger like we you know we we end up owning more and more we we know more of what's going on our teams and it's harder to look sideways to see what's happening with with the with the other leaders in the company so for me having lots of conversations uh keeping that communication open with my co-founders and with just any uh just other people in the company is um is awesome because you actually know that other people are going through similar emotions and that actually just feel really good like I feel good to just get things off of my chest and be like okay it's gonna be fine um yeah I agree by the way uh follow up on that call um John Johnny's I was CEO so he called me an hour later after we had a phone call and I said to John hey look uh and I are depressed here and talking about stuff do you want to join and John yeah and John said well I don't know about you I'm not depressed at all I think things are going very well and I'm extremely excited about what's going to happen next week and I'm like okay so you're not part of our group um anyways so uh so yeah definitely I think that I I definitely enjoy the everyday is a different day um and more than that I enjoy the fact that we are so lucky that the Universe gave us this opportunity to do whatever we want and to play in this in this in this game you know because I don't believe that no one will someone who's saying has a sanity um will give me the opportunity to do what I'm doing but as entrepreneurs we're like okay you are gonna be this and you're gonna take this title and I'm gonna play this title and this is what we're gonna do all day long and this is this is cool yeah and I have to say I we start off on a little optimistic people we're generally really happy um kind of probably a little bit to an annoying extent I think some might say but it works it's just it's a honeybook language and I also have to make up I have to put a plug in for my husband because he is also the person that I cry on his shoulder and he would be so mad if you saw this interview Consolidated no you have everyone in there and I love that so you guys have that tight-knit group as co-founders and then you extend it to your team what do you want it to mean culturally when somebody says I work at honeybook huh that's that's a good question um I want first of all I wanted to say I'm a honeybooker I like and then what does that mean okay so you're a honeybooker and and it means that first of all you do put put people first you know it's not a it's not just something that we say um uh we uh when we see like you know uh an email that we are very embarrassed by that came out of of our of our team um you know we take these these things to Heart so in a way what we want is that a honeybooker is someone who has the same values um who who feel that he wants to create Magic you know and then creating magic is in our core values it's going the extra mile um and we see that that you know people in our team are overkilling on something going the extra mile like oh he's a honeybooker and this is how you do that um and we want to see that person Fearless um we want to see that you take risk and that you're very proud about what you're doing you love what you do and that you're part of our family and then again I'm obviously repeating our cool values but this is what we want to see in every honeybooker very nice we expect the same thing from our customers and from our investors their honeybookers too I love that you emphasize going the extra mile because I know that you guys have an obsession with your customers and that's so important I just had a poor customer experience that I've been trying to just get a part replaced on a kitchen appliance and it's been over three months and now they don't want to send it to me so why do you think that that obsession with your customer and the commitment to go the extra mile from everyone on your team not just the four Founders is so vital to where you are today I mean we so the industry that we work in it's it's a customer-centric industry right our event our customers are constantly giving great service to their customers so we're just trying to speak the same language that they speak right and this is so as much as we can we always we...