S3 Ep03 Leadership Lessons: Kyle Racki on Managing Growth, Layoffs and Company Culture 

[00:00:30] Trygve Olsen: I'm in my normal spot, but Dave, are you like being held against your will in some wooden cabin in the North woods or, 

[00:00:37] Dave Meyer: I sure am. At our recording. It's the last weekend in September and it's boats out weekend. So I'm up 

at the cabin and it's the saddest weekend of the year.  

[00:00:48] Trygve Olsen: yeah. colors changing? Is everybody getting ready  

[00:00:52] Dave Meyer: a little bit. Although, it's a weird one with all of the weather. And so it's going to be 81 this is very different than normal.  

[00:01:01] Trygve Olsen: we experience, seasons in our business too. And one of the things that we've grown accustomed to is that once the fourth quarter hits, everybody starts to panic and realizes they have to get really good about selling and marketing. 

[00:01:13] Dave Meyer: Absolutely. 

[00:01:14] Trygve Olsen: they have to do it right now. So I'm excited for our guest today. 

But, before we get to that, we do need to, read our sponsorship. Do you have your copy ready? 

[00:01:22] Dave Meyer: I sure do. I think we're ready.  

[00:01:24] Trygve Olsen: All right. listeners, today's episode is brought to you by the Globex Corporation. the company that's always one step ahead of world domination. Oh, I'm sorry. world innovation. 

[00:01:36] Dave Meyer: That's right. And who could forget their charismatic CEO, Hank Scorpio. The man who redefined hostile takeover and made flamethrowers a casual Friday accessory. 

[00:01:46] Trygve Olsen: But it's not all high tech gadgets and secret lairs now, Dave. Globex also cares about comfort. That's why they've developed the hammock district. Yes. You heard that right. An entire district dedicated to the art of relaxation. 

[00:01:59] Dave Meyer: Need a break from plotting your next idea? Just swing by the Hammock District, where you can choose from a variety of hammocks. Whether you prefer the classic rope, the luxurious quilted, or the ultra modern anti gravity hammock. 

[00:02:13] Trygve Olsen: So if you're looking to conquer the world or just take a really great nap, Globex Corporation has got you covered. Visit globexcorp. net slash hammock district and use the promo code Scorpio for 10 percent off your first hammock order. 

[00:02:29] Dave Meyer: Globex Corporation, making the world a better place, one hammock at a time. 

[00:02:35] Trygve Olsen: I'm really excited because you know how much I enjoy a good nap. 

[00:02:38] Dave Meyer: Absolutely, me too. 

[00:02:40] Trygve Olsen: So we over clubbed on guests today. One of the more major tools that we use at BizzyWeb, we actually cajoled the CEO to finally come on the podcast. our guest today is, Kyle Racki from. Proposify. He's the CEO and co founder with a background in design and entrepreneurship. 

He's known for his focus on innovation and strong company culture. Kyle has led his team through key transformations, keeping them ahead in the SaaS industry. Passionate about continuous growth, he shares his insights on leadership and entrepreneurship as a speaker and an author. And sends me cold outreach on LinkedIn when I ask for it. 

[00:03:22] Kyle Racki: Hey, I don't know who wrote that bio, but I, it makes me sound really good. So thank you. Thank you for having me. 

[00:03:27] Trygve Olsen: we have robots for that basically. So, thanks for coming on the show. I think one of the things that, I've been a long time fan of Proposify and it's been a, Game changer for me. But I want to, before we get to that, I want to talk about one of the important things that Proposify I does, which I think is a differentiator. 

So what is the state of proposals  

[00:03:51] Kyle Racki: I, this was, we stole this from now every B2B SaaS company out there, but particularly social media companies that used to do this a lot, where every year they'd publish like their state of social media and they would share all the benchmarks and trends. And, we looked at it and said, Proposals are a black box, right? 

nobody really knows what their competitors are sending. Everybody's using like word and PowerPoint and these types of tools. So it's typically very hard to get access to this type of data. what do people actually include in their proposals? And we thought, why don't we just analyze our own database and share those things with. People, share it as a lead magnet, share it with customers. and this year we did it a little differently. We used to just have a human go and analyze the data. There's only so much that they can manually look at this year. We, built some machine learning models and started to feed the data to, machine learning and be able to analyze text and group related terms together and that kind of thing. 

So this year it's a little bit different, where we go to, we're able to go that one layer deeper in terms of analyzing, proposal content. 

[00:04:58] Trygve Olsen: What were some of the results of the, that, you found that were interesting?  

[00:05:03] Kyle Racki: there's, a few things. I think just in terms of. Being able to group related industries together and being able to slice the data in terms of, okay, these companies are really similar to each other. view by deal size, by industry, by location. so really being able to profile the types of companies and the types of content that they're creating was. was helpful. So if you look at if you go to state of proposals, you can just access it for free. You don't need to sign up to anything. You can see like how, does close rate breakdown by certain segments, for example, or by deal size. One of the interesting things was like, even just being able to see who's actually including videos in their proposals. 

We found that it was only like 20 percent across the board of companies that actually use videos in their proposals. And you would think marketing would be number one. it was actually towards the end. It was one of the, the lowest, amounts of companies are using videos in their proposals. 

So  

[00:06:06] Trygve Olsen: Wow. 'cause that's something that I do on a regular basis just to, 

[00:06:10] Dave Meyer: All the time. 

[00:06:11] Trygve Olsen: ' cause the tool is so dynamic. So let's back up a step. For those of you who aren't, massive fanboy like I am. What, is Proposify and what does it do for people?  

[00:06:21] Kyle Racki: Proposify is a software platform that essentially helps, teams be able to send out professional on brand proposals more quickly and easily and gather metrics and information on how their buyers are interacting with their, documents. And in particular, we really focus on helping growing teams that need to get more control and consistency with their documents. 

Cause we see a lot of. A lot of times when a business is scaling, sales reps are just winging it and putting out whatever's out there, copying and pasting from old emails. So a lot of leaders need to get more control and visibility into what's actually going out in front of buyers. 

[00:06:56] Dave Meyer: I think one of the things that we love most about Proposify is the fact that it integrates seamlessly with our CRM of Choice, HubSpot. And so you can set up specific what do we call 'em, hooks for, lack of a better term, Where it, it pulls in the. Data from your contact records. So you can actually spin up a proposal, put it in the right template, and it'll fill out all of the details. 

If you've done a good job as a salesperson and put it all into a recognizable doc. And the other thing that Proposify does that is super important is the ability to collect signatures that are legally binding. So how did, all of that stuff work together? Or how did you come up with the idea to really build this? 

Because it's, it seems obvious now, but I think back when Proposify was started, it was not necessarily a no brainer to set it up the way you  

[00:07:52] Kyle Racki: I think maybe we all get one idea in our life that we go, wow, why doesn't this exist? Why is nobody doing that? so I've used up my idea for my whole life now. And it was,  

22. I think I was a young designer working in an agency and they had me putting out proposals. Or one in particular for this big contract we were going after. 

And so they wanted me to pretty up the, proposal. I think I either did it in QuarkXPress or InDesign, but I was just getting fed all these word documents from account managers and having to go, we didn't have Dropbox at the time. That's, I think we might all be in the same age group. There was no Dropbox back then. I was going to, find CDs on, and like a wall where we saved all of our case study files. So I was just thinking, man, this is really stupid. Like, why don't we have a tool to make this easier? And I think a Basecamp had just come out around that time. So basically it was just like, there should be Basecamp for proposals. 

And that was just a thought that I just sat on for a little while. And then one day I was just like wireframing it up in my basement and thought yeah, that'd be a cool little SaaS app, like a, like an InDesign meets whatever CRM. But then I just sat on it for years. I started my first business, which was an agency business, and it really wasn't until, 2014 that we actually got going and found product market fit and all that kind of stuff. So now we just celebrated our 10 year, anniversary this summer. we've been in business for 10 years and yeah, like I said, this is, this is the once in a lifetime idea that you just go wow, this, thing needs to exist.  

[00:09:29] Trygve Olsen: think one of the things that I really like about Proposify is really not anything to do with the software. the software is great and there's a lot of identifying features that I think make it better than the competition. But, people, if you're interested, you talk to me about that offline. But one of the things that. As I got used to and becoming proficient in using it, one of the things that I found is the people who were helping me get up and running were, oddly, really nice and frank in talking with me. And they would say they wouldn't give me the standard customer service answers where they would repeat my question. 

And then, no, they'd say, they would very kindly explain to me what I did wrong. And then how I would do it better. And I found that extremely helpful. And I got really good at the software as a result of that. Cause people would actually just say, here's what you did wrong. 

Here's what you need to do better. Was that a, cultural choice to treat customers that way? Cause I think that's a massive difference that I really don't see in any other company that I work  

[00:10:36] Kyle Racki: I would say it was a really early choice to Over index on customer service. So I remember when we were just like, we had a product, but it was very early stage and we didn't have a lot of customers. Like I would be up till midnight and helping customers jumping on calls and that kind of thing. it was really just coming from a place of insecurity. 

I thought there's no way this business is ever going to work. So I need to really just, try extra hard to make sure people are successful. So I always really just wanted to. offer the best support, the kind of support I would want. And then once we were able to hire reps, like I was able to just they were able to see what I was doing, where I was like using animated GIFs to joke around with customers and that kind of thing. 

I, we weren't using a lot of pre canned replies and I was just lucky enough that we hired good people in the early days. Mel Gunn was, I think, number three, support person who we hired and she now is our director of customer success. getting those people early who are like, yeah, this is the kind of support I want to offer too. And then they just took it and 10 X it. Like I haven't really done support for years, almost a decade at this point, but that whole department just runs on its own without me. So I would say that they've taken the, early stuff that I started and just made it a lot better.  

[00:11:59] Trygve Olsen: That's amazing. One of the things that I'm always constantly and in awe of is anybody who runs a company like yours or any software platform, I think there's a tendency to be constantly inundated with customers who have a bad case of the Abbott's. this is great. Yeah. But yeah.  

Or, the can't ya just  

[00:12:25] Kyle Racki: way, that was a really smart reference to the, Hank Scorpio episode that you referenced earlier.  

[00:12:31] Trygve Olsen: thank you. Thank you. I appreciate that. not everybody gets my deep Albert Brooks, 35 year animated humors. That's what I, when you and I are buddies, I have a whole mess of questions, but that's the top of mind. That's one of the things that I always struggle with. How do you, guys work with that as you're continually trying to improve your  

[00:12:53] Kyle Racki: I have to be really frank and honest here and say that I think while we were an early innovator with our product, we, really lagged behind the competition in a lot of ways when it came to evolving the product. The last five, six years, some of that was just internal. company BS, if you will. but I think we're, in a place now where we're starting to hit our stride. So I would say that probably what really helped for a long time has been the quality of the customer support. That's one of those areas where I'm able to look at our competition and say yeah, no, I don't think anybody can offer the same level of support that we do. But that can be a little bit of a crutch sometimes too, right? Where they're going like. We know the product hasn't changed. It hasn't really, we haven't added a lot of new stuff. We haven't fixed certain longstanding issues. So the support team got really good at, bubble gum and duct tape to make things work. and that's something that I've been a lot closer to the product in the last couple of years. And we we're starting to make real headway with it where we're now able to actually capture customer feedback and do something about it. share in a little bit what that new big feature that we're launching is, but I think being able to listen to customers and be able to do something about it is, a really, it's, a key part of it. 

We weren't able to do that for a long time. We could listen and empathize and come up with a hacky workaround, but now we're able to actually make moves with the product. 

[00:14:26] Trygve Olsen: Got it. So what, is the big, then the next  

[00:14:30] Kyle Racki: At the time of this recording, so it might be out by the time this airs, but this would be the first podcast that I've, announced this on, we're launching a new features called Proposify automations and essentially what it is, everybody has a different way that they want their workflow to be set up within Proposify. 

So they might say Hey, when this thing happens over here, I want to notify these people in slack and update this part of my CRM and do all this kind of stuff. Essentially it's if you've used tools like Zapier to create, if this, then that type of automations. You can do it all in Proposify now without Zapier. So you can create automations within Proposify and you can also create automations that speak to third party applications. There's a library of, I think, a hundred plus different connectors. So tools that we didn't integrate with before, stuff like Microsoft Dynamics, Slack, Teams, Dropbox, all of these tools are now able to build custom connectors with 

[00:15:27] Trygve Olsen: Holy crap.  

[00:15:28] Dave Meyer: Yeah, I love it. And I would imagine that's not just a slice in time kind of addition. That's UI that has to be built and an entire integration or interaction set so that people can build those automations. How do you go about setting a, setting up a massive, addition like this to a company like you have tens of thousands of customers. 

how do you roll that out without crashing everything? 

[00:16:01] Kyle Racki: What we didn't roll it out yet. So we still have plenty of opportunity to crash it to the ground, but I don't think we will. I think part of it comes down to choosing the right. Technology partners. So we're actually using behind the scenes, an iPASS solution. So for, I don't, know how technical we want to go in this discussion, but essentially an integration platform as a service is helping power this behind the scenes. So the nice thing there is that we needed to develop our own robust API and all the endpoints that we feed in through this iPass. And then the iPASS solution is the thing that powers all of these integrations with. The hundreds of third party partners.  

[00:16:40] Trygve Olsen: So for people who aren't technical, really what Kyle's talking about is he's talking about a universal translator is he's plugging into the universal translator and then the universal translator's job, it is to figure out how to plug into everything else. So then that way, Proposify as a company doesn't have to create one to one integration with everybody else. 

They just have to connect 

into the one thing.  

[00:17:03] Kyle Racki: And so the workflow builders where you get the, we put the power in the user's hands to set up things how they want it to. They don't just have to rely on how our integration works with HubSpot, for example. So like Scott, my sales leader just, had a call with him and showed it to him. 

And he was like, I would love it if we could. set a timer that basically says, Hey, if somebody hasn't viewed my proposal in seven days, send me a Slack notification. I was like, yeah, you could do that with the automation builder. 

[00:17:31] Trygve Olsen: Wow. That 

is one of the features for those people who are, trying to get better at selling and marketing. One of the neat things about having a tool like this is it can actually tell you what people have looked at, if they've looked at it, how long they've looked at it. And whether or not they've kept it open. 

And one of the things that I learned was interesting is 85 percent of the time people skip over all the finely crafted messaging that you were days on and just get to the price because you can actually see that. But then the neat thing is that actually helps you with your selling because if you understand that they're buying just on one thing, then okay, then that's what you end up talking about. Also, it's good to know that if they've looked at it for three days, it's because they left it open and went home for the weekend. It's not, because you're, really pithy and you're writing or anything like  

[00:18:27] Kyle Racki: We're, fixing that in our version three product. We're actually working on the metrics for Proposify three right now. And that is one of the problems we're looking to fix is like knowing if the user's not active or they've like just left their computer open, don't count that as an actual problem. 

[00:18:42] Trygve Olsen: Can you talk a little bit more about that? Cause with all of the different privacy standards internationally, we're in the United States, you're in Canada, what we found is. It's something simple and basic as to be able to understand what is like a site visit. That's an interpretive statistic. 

And because a whole lot of different companies will give you a whole lot of different answers for that. So did you, have conversations in your next iteration of Proposify on how do we make this, how do we have this clarity around these, KPIs that we're offering?  

[00:19:18] Kyle Racki: there's a lot of improvements we want to make with our V3 product around, number of things, hence why we're making a new version of it, but one of them is with analytics and views and that kind of thing. And I think the approach we're going to take is basically just getting viewers to opt in and identify who they are so that it's a permission based choice on the viewer of the proposal. a lot of tools like, I don't know, like deal hub or doc send. I've been sent doc send, documents before where they basically say Tryg's sending me the document. Hey, he wants to know who you are. and you just put in your name or email address. And if we can do it that way, then we're basically getting people to like,  

Offer permission to say okay, yeah, you can identify who I am. The great thing about that approach that we're looking at is that you can then get individual analytics. So you can actually, all three of you here in the room, I can see like how you've interacted with the document differently from each other, as opposed to just saying the client viewed it, the client looked at it 10 times. 

It's. Nicole looked at it on Tuesday for 10 minutes, and then, Dave looked at it a different time. And then that way, if you forward the document to someone else, and they identify themselves, now I can get people who weren't even stakeholders, who might have buying authority or some kind of an influence in your deal, to be able to know that they're looking at your proposal. 

[00:20:39] Dave Meyer: That would save so much time and frustration. Oh, I can't wait.  

[00:20:44] Trygve Olsen: So we're a little fangirling out on the details, I think. Let's maybe roll out to, you talked a little bit earlier, Kyle, about, hey, we were stagnant. how did you identify that, hey, we needed to make changes? And then how did you start, talk to us about the process of self identifying, hey, we 

can do better.  

[00:21:07] Kyle Racki: in the early days of a, startup of a software company, you can move really quickly. And I think your, size and your speed, and even just the urgency of going wow, we've got, six months of runway before we're dead. So we need to move quickly as soon as possible. As time goes on and as we've raised outside capital and scaled up the team, there's a few things at play. 

So I think one is technical debt. The moving fast in the early days you build up a big backlog of technical debt which for anyone listening who's not, a developer Is a lot like bank debt, credit card debt, you if you don't pay it off. It builds up and up and it becomes unmanageable and it can be really hard to move quickly when you've got this huge, years history of technical debt that hasn't been repaid. and I think that was one big factor that we, hadn't paid that back and we had built up a lot of it. The other one I think is a little bit more cultural, which is, You raise money, you, go great. Okay. We can grow the team. We can do so much more things with more people. and I think what ends up happening or what ended up happening in my case, but I know I'm not alone is. You start to remove as the CEO yourself from the day to day, you start to have more layers of people beneath you who are doing the work and you don't have as much input into that work. And if you're not really good at, aligning people around a vision and like pushing on urgency, people just tend to move in different directions, row in different directions, and sometimes just work on things that aren't that important. Plus with the engineering team, having had that, all that legacy we were dealing with. We were more just like keeping the lights on than actually pushing things forward. So it took a couple of years. And in, in our case, we ended up in 2022 laying off, a pretty big portion of the team and especially where we've had this like pseudo downturn in the economy, everything got harder. 

Growth got harder. you access to capital got harder. So we really had to go back to basics and say Let's run this like a scrappy bootstrap business again. And I got way closer to the details and started working more closely with the team on product and marketing in particular. And I think it's starting to pay off. It's starting to show. But it definitely was a years long process of getting there. 

[00:23:35] Trygve Olsen: I want to talk about the layoff because I think, that, especially with you personally, makes you a unicorn because I saw what you did, and I saw how you dealt with it, and I haven't seen anybody else do it the same way you did. you unfortunately had to lay off a bunch of people. And then what did you do in response?  

[00:23:59] Kyle Racki: I posted about it on LinkedIn and, I just explained it, I didn't think that was me being a unicorn. I just thought that, the news gets out anyway. if you, and I don't even want to say control the narrative, I just want to say, I want to be the one to put it out there and to say, look, we laid off a quarter of our team. 

Here's why I F'ed up, for these reasons. We're losing some great people. We want to try to help them find a soft landing. And that's it. I didn't think that was me being a unicorn, I have seen one of our competitors who I won't name. I landed on one of their glass door reviews and they've got all these reviews of people saying like they're doing quiet layoffs. They're just like pushing people out the door quietly so they don't have to deal with the bad PR that comes from a layoff. And I was like, man. I'm glad we didn't do that. 

[00:24:54] Trygve Olsen: it does make you a unicorn because you did take ownership of where the company was, which is never happens in business.  

[00:25:06] Dave Meyer: I think the empathy part there 

too is huge in that, you announced and it wasn't to control a narrative. It was to tell the story and what was happening. And then the biggest part of that was teeing it up and saying, Hey, these are great people. We can't have them with us at least now. But. Here's we'd love to help them land and,  

[00:25:30] Trygve Olsen: yeah,  

you were actively trying to find people you just laid off. You were actively trying to help them find  

[00:25:36] Kyle Racki: Yeah. There was some great people that we let go and I was actually really lucky just recently, Steve, one of our designers, she was part of that layoffs, came back as a, contractor because he's building up his own freelance practice now. So just getting to like work with him again has been, great. 

But yeah. Yeah. It was, hard at that time, especially because it was still like January, 2022 was before, like there was this big downturn in SaaS. And I think a year later it would have just been like, yeah, obviously everybody's laying at people off. But at the time it was like, man, you guys must really suck. 

That was at least my perception of it was like, everybody was still, living, large off 2021 and all the VC money that got thrown around. So there really wasn't at the time, any layoffs happening in SaaS.  

[00:26:20] Trygve Olsen: Yeah. And that's just when people tell me again, I hate to beat a dead horse, but when people talk to me about, why do I use that as opposed to anything else? It's because the people are genuinely better. It's things like that, that I notice and I'm an evangelist of the product. 

It's because of the people and the choices that they make. Yeah, the software is cool, but you can get the, you can get similar software, other places. I arguably yours is better, but so anyway, back to the point, you're coming out with version three, soon, which is really exciting. are you making innovation now more part of the company culture? 

Are you going to continually try and evolve?  

[00:27:01] Kyle Racki: mean, short answer. Yes. I, the hard part of any kind of software rewrite is that you're basically starting over from scratch again. And we began that process two years ago. We basically said, okay, there's so much technical debt built up. We're using like old JavaScript libraries and just built in this huge monolithic architecture that. you can't do anything with it. You've got to start over. I was very lucky to get a great VP engineering. Who's now our CTO, Mark Lacombe about a year ago, and he was able to take what we were doing and make it in, take it to a whole other level, in terms of both just like speed of delivery and making really good architectural choices that will help it scale in the longterm. we're still in a bit of a limbo because we've got a very basic V3 product that. Does simple things, but doesn't do a lot. So getting to feature parody is the number one priority right now is we need to at least offer the features we have today in version two, and they have to be better than what we've got, but the basics have to be there in order to get people to use it and adopt it. And at the same time, we need to be thinking. Years ahead and going what are new features? What are new products? How do we leverage AI in a really smart way? That isn't just a check the box AI feature. we've got to be thinking about that stuff now so that we can get there when we've got enough feature parity for people to really use V3 and get value out of it. 

[00:28:36] Dave Meyer: you brought up the magic word that everybody seems to be talking about AI, as you're looking at, even just the future of proposals and how propose if I works, do you see a year down the road that things would be. Significantly different. some of, the AI tools are like, obviously you can do a grammar checker against everything that you put together might be able to use, for coding, for sure. 

You can build a lot of things using AI. Are there levels of interaction or connection that you think the upcoming AI advancements might help do, or yeah, what, might that crystal ball a year and a  

[00:29:19] Kyle Racki: So , AI is a very big part of our product vision and I think of it in three stages. When I said check the box AI feature, there's always that temptation that I think everybody had a year ago or especially two years ago when chat GPT was just coming out was like, we need a, AI button in our app that just writes the proposal for you. I resisted that a, because it wasn't our top priority. We had to fix like usability  

issues within our product before we could worry about throwing AI buttons in there. but the other piece is it really doesn't fit our value prop because. The reason people use Proposify and tools like ours is to actually get control and consistency in their proposals. As soon as you've got AI in there creating things, you lose the control that you wanted to have with your standardized templates and content library and all that kind of stuff. So the three stages that I think of AI and how it's going to make our users more successful and become real value ads instead of, box checking features is first of all onboarding. 

So the most difficult part of using Proposify or really any proposal software is you just got to get all your content into the system. And that's what takes the most  

time building out your template when we've solved that. And others have solved it with like template gallery, where you can, edit, pick something that looks good and edit it to your own brand. But I think that AI will be very useful when it comes to saying here's my website.  

[00:30:50] Trygve Olsen: hold on, I'm going to interject there because, and I'll say the thing that you won't, which is you had that and then other people copied it.  

[00:30:59] Kyle Racki: Yeah,  

that was actually our, the template gallery was our, it was the catalyst for us finding product market fit because until then people would look at it and go, yeah, this looks great, but man, I'm not rebuilding my whole, proposal in your system. And so as soon as we offered a template gallery that had nice looking templates that were already baked, that were industry specific, that people could just like use and customize, that was like. Overnight, pretty much we were starting to really grow. so that's table stakes now, but we still get a lot of, there's still a lot of friction with that, right? Cause people need to learn a new tool. They need to learn an editor. And this is where I think AI can really be a value add is if you can just point your website or your PDF of what you're doing today and say, Here's what I've got, can you just make it better? And then it just builds the whole template for you and you have to do minimal customization. Then more people are going to stick around and get the other benefits that you get on the other side of it with like e signatures and metrics and that kind of thing. 

[00:32:02] Trygve Olsen: One of the things that we learned is as just as a, as giggles on the podcast, when chat GPT came out, we actually had the chat GPT robot on as a guest. And we asked somebody, we asked it all sorts of questions. And then we had somebody who has a deep baritone voice who, we had a Darth Vader off with Dave and his, with his deep baritone voice. 

And what we learned is that it. the content creation. And I still would argue that it's not as good as something that somebody with empathy and thought can really provide. So just having that habit doesn't make you more effective. And that's where the things like the state of the proposals come in is the, people who are really winning are trying to tailor the proposals based on the individual need and not just spraying and praying for a sale.  

[00:32:52] Kyle Racki: Absolutely. 

Yeah. 

[00:32:55] Dave Meyer: Had you had three stages of A.I. So the first one 

we  

[00:32:59] Kyle Racki: that's where I think generative is just, it makes the, it will make the most different. But the other ones that I think are a little bit more maybe advanced and down the road are What I'm calling preventative AI. That's not a real term. That's just a term I made up, but essentially if people want, so people put things in, place right now, like especially bigger companies with like approval workflows. So they'll say I don't trust my reps to send the right thing. So I want to make sure there's barriers in place to make sure that we get notified and somebody in management gets to look at a proposal before it goes out the door, and I think that's a great use case for AI, if you can train the AI model and say, these are the things to look for. This is how to make sure that it's on brand, that they're not stretching the logo, that they're not using the wrong font, that the case studies are up to date, whatever it happens to be. There's no typos, it's not using the wrong client name. If you can train the AI and basically say let that give a first pass and even allow it to auto correct things. Then you can save managers a whole lot of time and free reps from being able to put all these hurdles in place for them to be able to send out contracts. And I think the third area that it gets really interesting is around predictive AI. So that would be like, if. If our system is housing all this data, especially around views and clicks and that kind of thing, what are the things that AI can generate that can actually help you identify risks to your deal closing and look at what other companies in your space are doing in real time to ensure that those deals close. That is a lot more fuzzier and far out and I don't know exactly what those things are, but I think if you can, Leverage the data to be able to create predictive insights, that can be a value add for customers. 

[00:34:41] Trygve Olsen: Now that you're on the cusp of coming out with. With, version three of Proposify, you've gone through layoffs, you're still standing. what do you wish you didn't know now that you didn't know 

[00:34:56] Kyle Racki: What do I wish I didn't know where I did?  

[00:34:59] Trygve Olsen: You didn't know, which, what do you, wish you didn't know now that you didn't know then? So what lessons are you taking from your 

[00:35:07] Kyle Racki: I think so.  

[00:35:09] Trygve Olsen: It's a Bob Seger quote. You gotta, I'm trying to, I'm trying to be,  

[00:35:14] Kyle Racki: to make sure that I wasn't, it wasn't a double negative or something like that. everybody's talking, I say everybody in the small bubble of tech startup ecosystem, for the last few weeks has been talking about founder mode. I don't know if you guys have heard of this, Ben Chesky from Airbnb, the CEO of Airbnb, was on a podcast, I think about a year ago, and he spoke about how when COVID hit, and obviously it changed everything as far as rentals, how he was, he had to jump back Into the weeds, so to speak. 

And he found that his company wasn't going the direction he wanted it to. And he, there's this great podcast. People should check out of him talking about this process and Paul Graham, who's like one of the OG venture capitalists wrote about this in a essay called, and he called it founder mode. 

So he talked about like manager mode versus founder mode. And I don't know if it's anything brand new, but I do think that there's this, mentality. That I spoke about where, you've, you get advice around the way you should run a company, which is like the CEO shouldn't be involved too much. And they should just have this executive team that they delegate everything to. And that mentality I see is shifting a lot now. And especially with that, Being labeled founder mode and having Ben Chesky talking about it. I think it's giving founders a lot of permission, if you will, to go back to running the details and being involved in product development and in marketing. And we're moving away from this mode of feeling like everything happens, needs to happen through layers of people. And you just hire smart people and you let them figure it out. And that I have seen firsthand doesn't work. You can hire smart people. But there's something missing. If the, DNA of the company is based on what the founder did in the early days and you remove that, the company does not go in the right direction.  

[00:37:08] Dave Meyer: I feel that there's a lot of stuff that happens, especially over the past five years, right? So over, over COVID and all the things that have happened that, a lot of businesses, especially in the founder space seem to be succumbing to professional management. And that loses a lot of the culture and a lot of the reason that many of the best people that those companies have joined in the first place. So injecting culture, I think everyone that we've ever talked to at Proposify, it's clear that the culture is strong and that, everybody wants to help the client succeed. And that's like the biggest, standard bear for the company. As you're looking back and. Making new decisions based on what, back to the Bob Seeger quote that trig we just brought up. 

yeah, as we're going against the wind, what do we need to do to keep that compass for your company then  

[00:38:17] Trygve Olsen: I see what you did there with Bob Seeger. And I appreciate that.  

[00:38:20] Kyle Racki: it's not to say that you don't need a team. And I think there's, a real balance that's needed here because I think a lot of first time founders or less, less experienced entrepreneurs. Find that they become the bottleneck in their business because they don't know how to grow through people. And a lot of it is that they are, they need to make every decision. Everything has to go through them. they don't know how to actually hire really good people and train them and empower them and coach them. They just like they hire a lot of doers who just bubble everything up through the CEO and that doesn't scale, right? 

You're never going to grow up. Business beyond maybe a million or two operating that way. But then I think the pendulum went too far in the other direction where it was like the CEO should be completely removed and have EAs manage it all. And the executive team does it all. And I think I'm starting to find the right balance. In a way that's actually working and it keeps me really motivated and engaged because I certainly have a team. I don't do everything, but I'm a lot closer to the details and I'm involved a lot in the execution of what's going on. And I think that once you get over that initial shock and hurdle that people have, if you join a company as an employee and you're used to the CEO, just being this kind of name over here that everybody. 

Knows of, but they never really get involved in the details. You're Oh, why are they getting, why are they DMing me about stuff and why do they want to hop on a meeting and talk about things? There's that initial fear that people have, but then once they get used to it, they're like you're just part of the team again. And yeah, you always have a certain amount of more like clout and more, they're more willing to defer. But I think if you can get the culture right where people feel free to disagree and share their point of view, even if you're the CEO, But they're also open and to feedback and ideas from the CEO and everything is in view it is like, Oh, I'm being micromanaged. that's how I think the balance gets there. And that's where I think we're at now. 

[00:40:19] Dave Meyer: Excellent. It feels like maybe you're the coach and not the athlete. Anymore. So you're telling people, okay, here's where we need to go. Or I see this and this doesn't match our company values or our culture. So you're providing the guardrails. You're providing the advice instead of literally doing it for people or micromanaging saying, you, there was a typo on page 32 of this proposal.  

[00:40:49] Kyle Racki: I think to take that analogy, I would probably put myself on the football team because I have my own deliverables and I'm at certain points required to run the ball up the field. but I'm doing it with the team and I've got a great fullback and a great kicker and a great, the rest of the people need to be in place and the other thing too is that founders need to stick to doing what they really do well. And that takes self awareness to know what you're good at and what you're not. Some of course some CEOs might say I'm a great at marketing and they're terrible at marketing, but I think if you really know yourself you can go, okay, I'm actually really good at these things. I'm terrible at finance. I don't know. 

I don't know how to code. So I'm not a good head of engineering. I don't, I'm terrible head of customer support. Cause Mel gun will tell me, apparently I used to be rude to customers or that kind of thing. So like I've got us, I've got a sales leader, I've got a CS leader. So you've got people who can compliment you. 

And then on the teams that I'm running, I've got people who are experts in paid media or experts in design. And so it's just, everybody needs to be good at what they do. Bring a lot to the table, make it really collaborative, but I'm playing the role of, Hey, we're on the team. We're doing this together. And, I literally just had this morning, a product manager go Hey, can you, I'm really busy right now. 

Can you just make me a Google form for like customer feedback? And I was like, sure, here you go. So we're actually doing this stuff together now.  

[00:42:17] Trygve Olsen: that's  

amazing. And that speaks to you as a CEO and as a person that they're comfortable enough to ask you that kind of thing. 

[00:42:27] Kyle Racki: I hope so. I like to  

[00:42:28] Trygve Olsen: That's very cool. we're going to have the link to the state of proposals and our show notes. But, Kyle, if people want to learn more about Proposify and get a demo, where do they go and how do  

[00:42:44] Kyle Racki: Sure. Proposify. com is the website. If you want to sign up for a trial or a request to demo, you can do that there. and if you want to follow me on LinkedIn, I'm probably most active there. So you just look up Kyle Racki, that's, my weird name and you can, follow me there.  

[00:43:01] Trygve Olsen: Thanks for joining us today. it's always a joy to talk to you and it's always a joy to see what's, coming next. 

[00:43:08] Kyle Racki: Thanks, for having me. It's my pleasure. 

[00:43:11] Trygve Olsen: Dial it in is produced by Nicole Fairclough and Andy Wojtowski. I'm Trygve. That was Dave. Thank you for joining us and we will try and do better the next time.