Navigating the Challenges of Bootstrapping: Insights from Harry Rao on Customer Acquisition and Team Building

Intro: Broadcasting live from the Business RadioX studio in Atlanta, Georgia. It’s time for Atlanta Business Radio. Brought to you by Kennesaw State University’s Executive MBA program, the accelerated degree program for working professionals looking to advance their career and enhance their leadership skills. And now, here’s your host.

Lee Kantor: Lee Kantor here, another episode of Atlanta Business Radio. And this is going to be a good one. But before we get started, it’s important to recognize our sponsor, CSU’s executive MBA program. Without them, we couldn’t be sharing these important stories. Today on the show we have Harry Rao. He is the CEO and founder of TestGrid. Welcome.

Harry Rao: Thank you Lee.

Lee Kantor: So excited to learn what you’re up to. Tell us about test grade. How are you serving folks?

Harry Rao: So Test Grid is a test platform, for example, if you’re building mobile applications or web browser applications. We provide like test infrastructure and AI on top to speed up the process of software delivery.

Lee Kantor: So if someone’s not using test grid, how are they going about it?

Harry Rao: Manual process. Like completely. They’re like imagine you’re just if you’re releasing your Facebook application right. You have to go manually test Facebook on like different versions of iOS or Android or Web and all that. So if they’re using something like Test Grid, it’s all automated.

Lee Kantor: So what was the genesis of the idea? When did you know that you had to work on something like this to solve this problem?

Harry Rao: Yeah, it goes back to ten years li when you know more than that. Actually, when iPhone came out and things of that sort as the adoption of mobile smart mobile operating system. Started building it at scale that we need. And the speed at which we need was what was important for us. So as I was working other jobs. Or as a consultant, I figured out that, uh, you know, something of this sort at a cost efficient way. So that you could reduce the cost of, uh, utilization or creation of software and increase the speed. So that’s how we started using more of these auto delivery agents.

Lee Kantor: Now, when it was in this idea stage, how did you kind of launch it? Was this something you bootstrapped or were you able to get funding?

Harry Rao: Uh, I tried to get funding, but unfortunately the concept was too good to be true at that point in time. Right. So I ended up bootstrapping it. So today we are absolutely bootstrapped and that’s been the greatest decision of my life.

Lee Kantor: So any advice for other kind of developers out there that are working on, you know, the next big idea, you know, kind of maybe the pros and cons of bootstrapping or some of the learnings you had from bootstrapping to the scale that you have today.

Harry Rao: Absolutely. Uh, I mean, like everything, bootstrapping has its advantages as well as disadvantages, but I’m going to focus on the advantages, right. When you’re bootstrapping, you are you have to be really, really frugal in where you spend your money. Right. So with that comes focus, right? You have to make sure what you’re choosing has to work. So you cannot go around and start making wrong decisions. Right. So but also that brings about, like I said, the focus and the grit to success increases with that kind of a decision. That’s my personal experience. But, you know, of course having a VC or external funding does give you certain flexibility. But when you are in like, uh, you know, sort of you’re in a longer time journey, you have to choose it, uh, wisely and spend the dollars wisely. You will have the flexibility of moving around and navigating the waters as you want, rather than when you take, uh, rather than when you take the external funding. So those are the advantages of bootstrapping, and you’re answerable to yourself and your true to yourself and your team. Right. So you can go to sleep happily in my opinion.

Lee Kantor: So now when you were launching though, how did you kind of get the software in the hands of, you know, your potential customers without, you know, kind of having the track record of something? And like you said, it was too good to be true in some manners. How do you. So how do you get those first customers to even try it?

Harry Rao: You need to knock on the doors. Make sure they believe you have to be persistent in chasing some of these decision makers. Like you said, if you’re nobody, they’re not gonna even listen to you. But eventually, if you’re persistent, people will start listening. You might lose first few of your prospects or customers leave. But if the story is good and it’s authentic, people are, you know, people are ready to partner with you. You know, it’s been my story. So, yeah, uh, just be persistent and have the grit and be authentic with your story. You’ll definitely, you know, you don’t have to have a story behind you.

Lee Kantor: So how do you create those first initial deals that get you the escape velocity you need to get to the new level? Like how do you negotiate those first deals with the, you know, the guinea pigs.

Harry Rao: Absolutely. I wouldn’t call them guinea pigs, because if my people are listening, they’ll be sad about it. But I would call them your friendlies in my, in the, in what we call them. They are sort of friendlies, right? Like, you know, these people from past, you know, their pain, you know, they have traveled with you. Right. So when you’re doing that, these these guys will give you their uh, uh, time and, uh, they will give you a chance, but make sure you don’t blow it up. Right. Usually you should chase like choose 4 or 5 niche down to one particular problem. Don’t try to solve everything right. And again, I’m guilty. I’m guilty of that mistake. Uh, first couple of years, I try to be everything for everybody never works. Then I said, like, okay, I’m only going to be focused on this particular problem. I’m going to go deeper. I’m going to solve that. And that pans out really, really well. And when you are talking to these friendlies, who gave you that opportunity? They will make sure you go to, uh, you know, you can, uh, you know, uh, go to the next step, so-called procurement, like you’re talking now. Pricing is still up in the air. If it’s your first time in the product, look what outside people are doing, right? Like, they’re probably competition. You’re never alone in the space. Especially in the enterprise software testing space, right? Look what others are doing. How can you bring more efficiency? Talk to your prospects. How can you solve their problem? Uh, you know, they all want to. Rather than giving them a tool and what is the price they’re willing to pay?

Lee Kantor: So how do you kind of negotiate those beginning prices? How do you kind of what’s the back and forth that happens so that you know that you’re getting some revenue if possible, and you’re also getting some sort of a, And a recommendation if possible, so that if they are getting a good price that they are at least recommending you to others. Like how do you structure those beginning deals? Because those can make or break your, your, um, service.

Harry Rao: Absolutely, absolutely. Those those are very interesting. Uh, I mean, especially let me talk on the B2B space. Uh, the, uh, the beginning deals are pretty much like, uh, you know, in my case, I’ll just talk about my case. Right? Uh, we had some competition in space. In our space when we had that, let’s say they were at, uh, lack of a better example, let’s say they were at a million bucks, right? We were like, okay, uh, how much can I get? Again, we were newbies in the space, right? It’s not raised to the bottom, but it’s always, can I get you ten x returns on if you switch to me? Right. So from what you’re doing today, it’s techniques, efficiency. There’s a very good book, uh, uh, from Amazon’s, uh, you know, uh, leadership called Working Backwards. Uh, and one of their leadership principles is, are taking new product to the market is if I don’t bring ten x returns to my customer, I am not in business because they’re not going to switch to you, not going to adapt, you know, because there’s cost of switching a software or anything. Right. So ten x means ten x efficiency and ten x price. So if at million bucks you should at least bring them that ten x cost of like $100,000. Or in that ballpark you’re saving uh huge. And also giving them more. So that’s when. So this is the thing you do with the, uh, technical leadership or all. And then once you go into the procurement, they’re going to still, uh, you know, compare, do benchmarking with the people around in the industry is like, you stand here, we stand here, you know, then also a little bit of, uh, negotiating around, but, uh, it’s usually those kind of scenarios.

Lee Kantor: So now when you were growing, how did you go about building your team? Because that’s also one of those points of inflection that you got to get. Right?

Harry Rao: Absolutely. So that’s the other thing, right. In bootstrapping, you are playing it by month to month to quarter to quarter in the early days. So building your team is also it’s one important thing is you need to have your core team for the long run, right. So whoever you choose, they should be here with you, not for the next year, but for the next decade. Right? If you’re building something that long term and a good vision that those are the kind of people, uh, you need to have so that trust. Uh, you know, before you tell them, them figuring out, uh, as well as, uh, going back to, uh, building the team is like, those are kind of, uh, uh, you know, questions you as a entrepreneur need to ask and have a, uh, you know, and, uh, put the expectations out there with your team as well as, again, you hire them, uh, like they say, there’s a common saying, which I’m not a fan of, but, you know, hire or slow fire fast. I don’t believe in firing fast, but I’m definite believer in hiring slowly. Right. Because it’s day before you get married. Sort of, uh, especially when you’re bringing somebody to the core team. So those kind of principles are, uh, what I follow. And going back to the numbers again, make sure you, uh, do your math quarter to quarter, because you should pay your team before you get paid. So that is another important thing in bootstrapping principles. Right? So those kind of things like.

Lee Kantor: Now when you’re working with a team and I’m sure your team is all over the place. How do you kind of keep the engagement strong when there are a lot of remote workers in a variety of time zones?

Harry Rao: Oh, God. Um, yep. Uh, we have teams all across the globe today. How do I keep them all in? Uh. Uh, you know, good communication would be. How would I say it? Thanks to technology, Lee. Like. Right. So we are all always on chat. We are on, like, you know, phone groups like WhatsApp or, uh, you know, uh, uh, zoom calls, teams, groups. There are multiple ways. But, uh, usually there is a process I set for myself and my leadership. Uh, and again, they manage their remote teams, if there are any under. But most of my dev is centrally located. So I believe, like, you know, dev has to happen centrally. My marketing is, uh, remote distributed, but daily stand ups, consistent communication. And here is a very simple principle I live by. Don’t text call. If you have some problem or something that you need, if that person is on other call, he’ll hang up. Then leave him a message but lead with a call. So that’s one of the major, major principles I live by and I make sure my team goes by. That is like call even I. I make sure my leadership calls me if I’m busy. I say, okay, leave me a message. But lead with the call.

Lee Kantor: Now let’s get into your product for a second. Um, talk about I obviously that’s, uh, it’s everywhere nowadays, but how how is that impacting what you’re doing? And is that making it more efficient and faster for your customers now with I’m sure you’re kind of leaning into AI, but maybe you’re helping in ways that they’re not anticipating.

Harry Rao: Absolutely. I mean, I is is, uh, is amazing, right in my, uh, you know, as far as I’ve. Uh, I truly believe in it. And we are leading with it. It’s, uh, going to bring, uh, huge efficiency. And for us, we are already leading it with it to in testing spatially. Uh, we have a product called Code tester. So it’s like your, uh, eye testing agent that sits with you, that learns with you, like, excuse me? Like a real tester. Right? And it writes your automation test cases, gives you the results that you want. It’s just increasing the velocity of, uh, you know, entire AI space. If I have to talk about. It’s just increasing the velocity of the amount of, uh, products we can, uh, uh, create and we are all after. You know, the bigger problems we always wanted to solve. So that’s my take on I li. And, you know, we are leading with it with core tester.

Lee Kantor: Now, in your company today, are your clients, uh, the same as they were when you started or now you penetrating kind of the fortune 500. The fortune 100?

Harry Rao: Absolutely. So, uh, my clientele is, uh. Okay, to answer your question, I always targeted the fortune 100 to 500 to begin with. Uh, but it’s hard. It’s like you were talking in the beginning of this call, right? Like the procurement. Like, how do they believe you? You are, you know, you don’t have the backing. No. You know, you just bootstrap these kind of problems. Right? But fast forward today, you know, we have, uh, at least 20 of the fortune 100 as my customers, uh, and my clientele is only, you know, fortune 500 to fortune to 14,000. That’s how deep, you know, they need our kind of, uh, product and services, right? So, uh, how was, uh, it changed from where we were? But the adoption has accelerated. Uh, we led with it. Uh, we didn’t we never. I wouldn’t say we never. We tried to target the SMB space and all, but again, it’s, uh, we wanted to satisfy a fewer customers and keep them happy and solve their problem. Perfect. So we had to pivot towards this. And rather than going into the SMB space early. So.

Lee Kantor: So what what what have you learned? What advice can you give, uh, to folks out there listening when it comes to penetrating the fortune 100 of the world? You know, what do they demand from their tech partners that you learned?

Harry Rao: Absolutely. So what I learned is if you’re switching from an SMB assembly space or all. We call it that, uh, dopamine effect. Right? Like, you know, once you close a deal, you get that rush. That’s very, very slow. In enterprise, the sales cycle is like 6 to 9 months. On a bad day. On a good day. Sorry. Right. On a bad day, it can be a couple of years. So you’re consistently. Working with them, working their procurement cycle. You have to be very patient very thorough because you’re going into fortune 100 company. Your security has to be top notch. You have your entire team has to be like, you know, it has to be run tight, right? So, uh, no stone unturned. That’s how it works with the enterprise. So patients solve deeper technical problems that they want. Price is never the issue, but always keep it efficient so that they get their ten extra turns. These are sort of principles. Uh, I live by especially, and I would advise any future entrepreneurs when they are chasing, uh, a fortune 100 and don’t give up. They always are very welcoming. As long as you solve their problem, stay at it, solve the problem, but make sure it’s it’s the best, uh, product out there.

Lee Kantor: So what’s next? Anything, uh, that you can share on the roadmap, any events or any products or services that are new or that we should know about?

Harry Rao: Absolutely. Going back to our discussion on AI, right. Uh, we are launching something called as our next version, the 2.0 version of Code Texture, uh, where we learned a lot of stuff, uh, from our existing enterprise customers. And again, it’s more towards the enterprise. Uh, so we are launching that it’s enterprises again to the future entrepreneurs. Right? Uh, they don’t like transformation. Right. They like incremental releases. And that’s what we were trying to do, is like, they have their legacy scripts, you know, uh, going back to the world of when, you know, uh, the, uh, going back to the before SAS came in. Right. There was, uh, there were windows desktop applications or thick clients. Sas came in. Sas was like, it’s a migration cost. There is so much to it. Now comes I, you know I platform as a service is a whole different beast. But enterprises have legacy. They have to move slow. There needs to be more support. And if we need to make their life easier to adopt, uh, or adapt, uh, the AI side of things. Right? So, uh, for that is what we try to create this protestor todo Which will help them move away from the legacy, but in an incremental fashion and future proof them. So that’s what’s coming, and we’re very excited about that.

Lee Kantor: So if somebody wants to learn more, have a more substantive conversation with somebody on the team, what is the website? What’s the best way to connect?

Harry Rao: Uh, test grid.io. Uh, simple. Just, uh, follow us on LinkedIn. That’s the best way. My team is always there. Or just drop an email at info at IO.

Lee Kantor: Well, Harry, thank you so much for sharing your story today. You’re doing such important work and we appreciate you.

Harry Rao: Absolutely. It’s great having, um, um, thank you for having me on the show. And, uh, I’m very excited.

Lee Kantor: All right, this is Lee Kantor. We’ll see you all next time on Atlanta Business Radio.