Ilan Twig – Co-Founder and CTO – TripActions – 2 of 4 – Stream to Ocean
14 Minutes of SaaS Transcript
Ilan Twig: We sold StreamOnce, but I didn’t really felt that I filled a desire of building a company in the valley. It’s a nine month journey – and out of this nine months, two months was due diligence. So we knew that we were going to be acquired for more than two months. So really there was nothing. That was that. And we knew that the next thing would have to be, you know, have to be big. And in order for that to be big, the market must be big. You know, there are markets you can have the most amazing idea, but if the market is small and you are the most successful with no competition, it will still be small. So we looked for huge markets. Travel is one of them.
Stephen Cummins: Welcome to 14 minutes of SaaS! The show where you can listen to the stories and opinions of founders of the world’s most remarkable SaaS scale-ups!
In this, episode 108 of 14 Minutes of SaaS, the 2nd in our 4-part series with Ilan Twigg, we listen to his initial journey into entrepreneurship with a cloud and subscription based integration platform. Like some founders he talks about 2010, 2011 and 2012 as the beginning of SaaS – when I hear dates like that, it reminds me of how early I was in that space working in multiple roles with Salesforce from the beginning of 2003. But Ilan’s 2 startup experiences are off the charts for 2 different reasons. This episode is about early success with StreamOnce – early being the operative word.
A star CTO, but you eventually made that change … that move, into StreamOnce – and that was your first move into the life of an entrepreneur. And I have the feeling, although it was the sum of everything, without that, TripActions may never have occurred.
Ilan Twig: Absolutely. I think you’re right.
Stephen Cummins: … because it was very successful in quite a short period of time …
Ilan Twig: Yeah, so I think the sum of everything I that had in life until 2012 led … as well as for Ariel because we spoke about that as well … led us to start StreamOnce. It was…I had this unbelievable desire to have my own company in Silicon Valley.
Stephen Cummins: Okay.
Ilan Twig: I had two companies before that in Isreal, but at that point I’d spent over seven years working for big companies and it didn’t make sense for me. It’s like it does not make sense. You know when something in life does not make sense, you feel it every day. It’s like living in the matrix. Feels weird right? And then you know the time was right. Ariel and I had…Ariel had moved from Isreal as well … to Mountainview… and we were in touch. I had heard a lot of amazing things about him and one thing led to another and we said: “Let’s Do it.” And it was a huge decision. And that’s where, I think personally, I learned what it means to become an entrepreneur …. because for me the transition was resignation. And it was you know “Can I resign?” I was at HP at that point. HP acquired the company that both Ariel and I used to work for. However, at HP my career was like a rocket-ship there. You know life was good. It was terrible, but on paper life was good.
Stephen Cummins: Yeah, Why was it terrible?
Ilan Twig: Why was it terrible? … Because it’s a huge company. At that point, it was 340,000 employees.
Stephen Cummins: Is it like politics and all that?
Ilan Twig: It’s just politics. You do nothing else.
Stephen Cummins: I’m allergic to it as well.
Ilan Twig: That’s exactly how we … both my Co-Founder and I …. we are allergic to that. So yes we ended up … it was the right time I guess. And we had these conversations. He was ready. I was ready We kind of were the same age and we made this decision. And I remember: “Okay now we need to resign.” Otherwise, it never happens, right. It’s very difficult to work full-time and work on a start-up because a start-up is more than full-time. So if you don’t really let it happen, it will not happen.
Stephen Cummins: And you had the strong idea already?
Ilan Twig: We had an idea. We spoke about it. And still … it required a ton of… a ton of energy to resign. I remember this because I was… I had a mortgage. I’d just bought a house … and my wife … my ex-wife was pregnant and it was like “Okay.” But we made a decision. There is always excuses, right? And when I looked in the mirror it was like, “Okay this is an excuse and if you want to have a start-up, if you really want to have a start-up, you need to do it.”
Stephen Cummins: And would you say that at that point in time you had some product-market validation … or you had some real validation in some way before you resigned? Or was that yet to happen?
Ilan Twig: We has some validation. But the thing with these types of validations, when you just start, it could be very unorthodox. It’s not like we conducted a thorough market research. You know …. you do what you can. You apply all of your skills to really convince yourself. But in the end you convince yourself. Which is okay because, you know …
Stephen Cummins: You have to believe.
Ilan Twig: A) You have to believe and when you talk to investors, they need to see you are genuinely convinced! So you have to convince yourself. Otherwise, you kill the start-up before it started. So we were convinced! …I’m talking now in hindsight. I’m telling you that, you know, it wasn’t that deep. I mean it was the deepest possible back then. But the same thing, by the way, applies to TripAction. We can talk about it later.
Stephen Cummins: Absolutely.
Ilan Twig: So, yeah and in the end, we decided to do it. We realised … I said it five times, but we realised entrepreneurship starts with resignation and we both resigned. Now we’re naked! Now we do it. And we were so, so serious. We were not funded at that point. It was okay … now we work toward funding ourselves. It took us three months. We did not know it was going to take three months, right. Then you get funded
Stephen Cummins: Yeah.
Ilan Twig: But we didn’t know. So it’s three months. It was the longest time of my life. It was fun, super stressful, and this uncertainty of what’s going to happen tomorrow? The clock was ticking and I gave it a budget from my savings. It was a third of my savings. And I gave it up to six months because I limited the time as well … because I was thinking about myself and my relevancy to the workplace. So that was the same week. We agreed on the same timeline Ariel and I. And in three months we ended up raising money. And my Dad, who still lives in Israel, he could not comprehend and contain the resignation.
Stephen Cummins: Wow.
Ilan Twig: He could not. And he seriously told me “You know you should maybe talk to someone…like a professional”
Stephen Cummins: But that’s in your Dad’s nature, because when you came in and started automating all the switches in your house he said: “Don’t get electrocuted.”
Ilan Twig: Yes
Stephen Cummins: So your Dad’s a worrier by nature. Are you a bit like that? Are you a bit of a worrier by nature? Did you…those 3 months, just describing it, it feels like you hadn’t quite left the fear behind. You still had that with you. You were driven, but you still had some fear.
Ilan Twig: Yeah, that’s why getting into this journey I had my rules. I kind of contained it. And I said up to one third of my savings, up to six months. And this was set in stone. Non-negotiable.
Stephen Cummins: Of course.
Ilan Twig: That’s where I was, you know, responsible.
Stephen Cummins: So you could accept that.
Ilan Twig: Yes.
Stephen Cummins: “Now I can leave the fear behind, and now I go forward.” Yeah, yeah, yeah.
Ilan Twig: But then once I knew that, you know, I had my guardrails, we focused on trying to get funded. It was very difficult to get funded. The first time is very difficult. Unless…you know, there are some exceptions, but otherwise it’s…at least that’s my experience. It was very difficult. You go and you try to convince strangers to write you a fat check based on some beliefs that you have, you know. It’s very …
Stephen Cummins: It’s much harder to get funding for StreamOnce than it would have been for TripActions, right?
Ilan Twig: Yes.
Stephen Cummins: It was a much bigger jump to do that.
Ilan Twig: StreamOnce was … it’s so complicated to explain what it does, so maybe it would be a waste of time to do it here …
Stephen Cummins: Just at a very high level. What value does it bring to the world..
Ilan Twig: It’s an integration middleware in the cloud. That was the idea. It was like a platform. And the reasoning behind it was … we used to be in the world where it was everything Microsoft, right? So you have the email, and the documents, and the file storage and everything was Microsoft. And communication. And then you know in 2010, 2011, 2012, 2013 it was the boom for the SaaS companies.
Stephen Cummins: Yes.
Ilan Twig: So you had Evernote for note taking, and it was specialized on that. And then you had, you know, Atlassian came with JIRA – and now everyone uses JIRA for that. And this whole, you know, shadow IT and, you know … so IT started to lose control and employees started to introduce all those SaaS systems. It’s so easy to involve yourself, you know, two clicks and you have a system.
Stephen Cummins: So seed and grow starts.
Ilan Twig: And then you…
Stephen Cummins: Instead of IT going right; “Let’s get an all you can eat deal and share that out to our reluctant departments in the company”
Ilan Twig: Exactly. Exactly that. So it was a big shift in the industry. And we recognized the shift and we said “Okay, we have an assumption. The assumption is that there is no way back from this shift. So it will just get more and more like that.” And if that’s the reality, if this is the case … then the reality would be, that there is for every area … for every service … you have a different vendor. And they are completely disconnected. And then we said there would still be a need to connect all these systems. And so we built StreamOnce where the integration needed to be right in the cloud. And we said if we could come up with a way that will allow any employee to connect between Evernote and Salesforce and your email and the file system … that you could choose to connect them together in a really meaningful way … that would be valuable. So we created StreamOnce. Allows you to connect all these systems. It was pretty successful in the beginning because after nine months we got acquired.
Stephen Cummins: That’s amazing.
Ilan Twig: So we raised less than … almost 1.5 million dollars. And nine months later we were acquired for almost twenty million dollars.
Stephen Cummins: That’s a fantastic result.
Ilan Twig: And we had a few OEMs of …. I don’t remember the actual …
Stephen Cummins: You probably sold it for a song because you were first time entrepreneurs. I bet It was worth a whole lot more than that. Am I right?
Ilan Twig: Yes it was for sure. Yes. But yes, that was the story of StreamOnce.
Stephen Cummins: But it was still, looking back …. much better to sell early. Because, if you hadn’t, the timing is so huge … the next rocket-ship that you’ve built …. And just before I get into this just for the listeners I mean, it’s a four year old company [TripActions] in November. 2 years… exactly 2 years from today ago … there were only 71 people. And today there are 964, I believe, which off the top of my head maths is north of 1300% growth.
Ilan Twig: YeahStephen Cummins: Which is phenomenal! Phenomenal! So let’s jump into that. What was the thing that made you think we need to create something in the travel industry? What was the thing that happened? What was the pain you felt?
Ilan Twig: So it’s a multi-layer answer. So we sold StreamOnce, but I didn’t really felt that I filled a desire of building a company in the valley. It’s a nine month journey – and out of this nine months, two months was due diligence. So we knew that we were going to be acquired for more than two months. So really there was nothing. Same for Ariel. He really wanted to be a CEO of a company, you know. So there was still this strong desire to fulfil that need. So that was that. And we knew that the next thing would have to be, you know, have to be big. And in order for that to be big, the market must be big. You know, there are markets you can have the most amazing idea in … but if the market is small and you are the most successful with no competition, it will still be small. And we did not want to limit the size of the company from the get go. So we looked for huge markets. Travel is one of them. It definitely checks …
And travel is what? … 11 or 12% of GDP of the globe … the last time I looked at it.Ilan Twig: It’s huge! Companies around the world spend, just on corporate travel, spend 1.3 to 1.5 Trillion dollars. And just in America half a trillion. So it’s a huge market. Definitely checks all the boxes. Then you know, we were travellers. So StreamOnce was a very technical company. We got acquired and then we travelled a lot. We travelled a lot because every prospect, every meeting with a potential customer, I had to be there. Ariel had to be there because there were a lot of details on how it works.
Stephen Cummins: So StreamOnce was an enterprise play then. High touch …
Ilan Twig: Yes. So. We were travelling a lot and they we got exposed to how problematic this market is. How archaic it is … starting with the tools … and then the companies that support you and the tools that they have. It was just so, so behind. And it just begged for some change. And we think about “Hey let’s disrupt this market ..”. It was like suffering while travelling .. you know … you get stuck and you really need help and you beg. And there’s no one there to help you. And you wait on the line for someone to talk to a stranger and explain who you are for the 1st 15 minutes. At some point we realised “Hey… there is so much potential here.” Like everything that we touch is broken when it comes to corporate travel. Everything!
Stephen Cummins: In episode 109 of 14 Minutes of SaaS, the 3rd in our 4 part series with Ilan, he chats about about the fantastic voyage he has taken with Arial – turning TripActions into, at the time this was recorded a few months ago, the fastest growing software company of all time.
Stephen Cummins: You’ve been listening to 14 minutes of SaaS. Thanks to Mike Quill for his creativity and problem solving skills, and to Ketsu for the music. Thanks also to Anders Getz for the transcript. This episode was brought to you by me, Stephen Cummins. If you enjoyed the podcast, please don’t forget to share it with your network, subscribe to the series, and give the show a rating.