Howard Lerman On His Last Company Being Valued At $1 Billion And Raising $50 Million To Design The Future Of Work

Howard Lerman has been building and selling companies since he was in college. After taking his last venture through an IPO, he has launched a new startup helping to solve the future of work dilemma that many are debating right now. His startup, Yext, has attracted funding from top-tier investors like Insight Venture Partners, WGI Group, CrunchFund, and Grape Arbo VC.

In this episode, you will learn:

• How the fundraising ecosystem has changed
• When to bring in an outside CEO
• The process of going public
• Why not to self-fund your company alone

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For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.

Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).

Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.

About Howard Lerman:

Howard Lerman is Yext’s Founder. He founded Yext in 2006 on the principle that the ultimate authority on a business should be the business itself.

From 2006 until 2022, Howard developed Yext into an innovative, global brand that can live up to that principle.

With a mission to help businesses and organizations around the world deliver official answers everywhere people search, Yext is delivering the future of search to thousands of brands, businesses, governments, and organizations worldwide.

Howard stepped down as CEO in March 2022, passing the torch to Michael Walrath, Chairman of the Board.

In addition to Yext, Howard co-founded Confide, a leading off-the-record messaging service, and served as its chairman from 2014 to 2020. He is a proud graduate of TJHSST and Duke University.

Connect with Howard Lerman:

• Crunchbase
• LinkedIn
• Bloomberg
• Twitter
• Instagram

Read the Full Transcription of the Interview:

Alejandro Cremades: All righty hello everyone and welcome to the dealmaker show I’m super excited about the guest that we have today you know he’s a serial entrepreneur. He’s built several companies and I think we’re gonna be very inspired with his story so without farther ado let’s welcome our guest today. Hallward Lerman welcome to the show. So originally you were from Virginia so one give us a little if I walk through memory lane. How was life growing up.

Howard Lerman: Thanks for having me.

Howard Lerman: Well, you know I sort of grew up I would suggest a little bit like a stranger things child in the Hawkins Indiana type suburb of Virginia I rode my bike around in the 80 s a lot and um, you know as a kid I think I was ah a. Ah, very mediocre baseball player. But I love to do it. But more importantly I was ah an opera singer as a kid grown up and so you can imagine. How cool it looked when your mom would come to pick you up to take you from baseball practice to opera practice I got really used to being punched around a lot.

Alejandro Cremades: I Hear you I hear you and now I know that you know when you were in school. You know you got into computers like very early on. So um, so how was that you know first encounter you know and and and where you were like my God This is so cool.

Howard Lerman: Yeah.

Howard Lerman: You know I I grew up at the perfect time because I had a childhood in the 80 s where there were no phones and no ipads and no internet and no computer and around 1994 ninety three. That’s when things really started to kind of become real and. You know that was right when I was becoming a teenager you know I was 1314 years old during those years and I just remember the excitement of when I was 13 figuring out how to run what’s was called a bulletin board system and this was predated the internet you would use a phone to call into somebody else’s kind of computer and. You could talk to people and post games and sort of do other things there so I got really kind of acquainted and comfortable with connectivity and doing all that kind of stuff at a really early age that that and then the luckiest thing in my life was getting into ah a. Ah, math and science high school called Thomas Jefferson high school for science and technology. It’s a stem school science technology engineering math where I met other people that were like me.

Alejandro Cremades: So what did you do there when he came to ah grabbing the phone line and and creating the chatting system. What what was that.

Howard Lerman: Yeah, you know they used to have this software called wildcat bbs this was before the internet existed what you would do is you would use the phones to dial your computer and have a phone line dial somebody else’s computer so it was like peer-to-peer. And you could host a few people at the same time if you had multiple phone lines. So yeah, we’re all used to today just connecting a gajillion people to a call. This was one person could call in they needed a dedicated phone line to do it but I would host people I’d host games from my computer. This was all when I was. 1314.

Alejandro Cremades: And that’s you know the type of stuff that other people were were experimenting with like Sean Parker you know as well. That’s amazing.

Howard Lerman: That’s right? Yeah Sean Parker we used to do stuff with Sean Parker you know the Facebook ah former Facebook president and I I got to know Sean when I was I grew up with you know in the same neighborhood as him. Um, so there was a lot of kind of fun stuff that would that would happen when we were kids. Um, and but you know but the cool thing was it wasn’t mainstream yet and it was ah it was a strange dynamic because we knew something that our parents didn’t it’s an interesting dynamic when you’re an expert at any programming or any sort of technical skill. And really nobody else knows how to do it yet and it was a time in which yeah ninety three 94 95 the internet was growing very fast and was there but it was the kind of thing that people would write about on time magazine. But the mass was not mainstream at all people didn’t know how to use it and and I think. You know when you’re whenever you’re involved in a formulat of your formulat of ages with something. It makes you just kind of gets it to your brain and and and it’s there with your your whole life. It becomes a part of who you are as much as I hate to admit it I think it’s part of who I am the internet.

Alejandro Cremades: Now Obviously as you were saying the internet you know became part of who you are so you had it clear So why did you go to duke to study history out of all things.

Howard Lerman: Well I you know history was a great major and don’t tell the duke professors this but it was the easiest by far I was a terrible student I I pretty much never went to class and I found now you know with chat gp history’s done forever. It’s hard to imagine how people are going to. Not write history papers using Ai um, but at the time I was able to cobble together enough papers to just pass barely while I could pursue other interests.

Alejandro Cremades: So there was say definitely 1 thing there talking about other interests that they involve sending people tips anonymously what was that.

Howard Lerman: You know I started my first company at Duke and it was I was 20 when we started it. This was back in you know, 99 or 2000 it was called just a tip.com it let you send your friends anonymous tips telling them about their annoying problems. It was really funny. It was tongue in Cheek. It was a joke. But you would get an email saying hey you knowlary you have someone is asked just to anonymously inform you that you have bad body odor or someone has asked this to anonymously inform you that your 2 pay is obvious we had all these precanned kind of tips this was ah at a time when you could sort of have a site like that go viral via email. And it did go viral and it ended up reaching millions and millions of people Jon Stewart sent 1 on the daily show which caused it to just absolutely explode and this again was in you know, twenty three years ago but it was for for us. We ended up selling the company. You know in in a matter of a year. It was really a good first taste into the world of business because we had a quick win. Ah.

Alejandro Cremades: and and I guess also a good first day taste that what it looks like you know at um, you know at building scaling and and exiting I mean the full cycle of a business I guess what kind of disability did that gave you.

Howard Lerman: Breath. Well at the time you don’t know you just think you know when you’re 1920 and you sell your company for a few hundred thousand dollars you think you know that’s just how it always is it wasn’t like I was looking at myself from the outside in thinking that wow. You know how lucky am I to be going through this experience right now to have had such a positive experience with selling to a great company meeting some great people that ended up being mentors later on frankly was very lucky and maybe luck is the theme that you’re going to hear from me over and over and over again because I do I do think that. You know I’ve just I’ve had certain lucky things happen which is which has made which has made us go. But you know at the time you didn’t realize how lucky that was and how unusual it was but it did happen and um, the other thing you learn is how little a couple hundred thousand few hundred thousand dollars is after you pay taxes and you’re. You know twenty you feel like you’re rich for a second and then it’s time to do something else.

Alejandro Cremades: And as they say lucky is preparation meets opportunity. So good stuff Now you know your case you know you saw the um, the full cycle of a business but rather than and obviously with that crazy traffic that you guys you know were able to experience with this company. But. You know what you did after this is is Interesting. You know which is you know the next business was really a consulting firm. So a consulting firm. You know is not that repeatable and scalable right? As you know what? you maybe had experience before. So Why? the consulting side of things.

Howard Lerman: Um, yeah.

Howard Lerman: You know what happened and we think about this a lot why we went down this route Nine Eleven happened you you have to think back to that time in the United States and yeah, we just sold. Our first company and when I say we I mean my cofounders Tom Dixon and Sean Mckaiseac who I still work with every day to this very day including through xtin at romem and then you know the twin towers went down and we were on the East Coast we were in you know the Dc area and it just. I don’t know why we did this but we just felt like it was the patriotic thing to do to you know use our consulting our technical abilities to sell consulting services and many of the people that we served were government agencies or you know contractors of government agencies serving ultimately serving. Government is the end and that you know is a twist of fate that I I think about a lot and we ended up having a good outcome there I wonder what would happen if we didn’t do that.

Alejandro Cremades: I mean selling you know a company for 7,000,000 boxes say not battle and outcome. How old were you my god I mean do you remember? what was the first thing that you did with all that money so young.

Howard Lerman: 24

Howard Lerman: I think I bought a security called auction rate securities which ended up being a illiquid cash substitute that thank goodness Citibank made us whole on. Ah.

Alejandro Cremades: Wow, that’s amazing. So so here you go now you know from ah the consulting side of things to you know now getting back on track with it building something that is repeatable and scalable now in this case, you know 1 thing led to the next you know you got started with.

Howard Lerman: You know I was pretty determined to keep going pretty much.

Howard Lerman: Yeah.

Alejandro Cremades: Gym ticket and ultimately gym ticket you know was like the immediate you know, ah kind of like a sequence of a venture or perhaps what led to creating what ended up being yes with a massive success. So Why so walk us Through. What was that journey like from starting with this company and and how do you all of a sudden you know like see yourself you know with? ye.

Howard Lerman: I think it’s important to think of yex kind of in two phases. The first phase was our media model phase the second phase was our saas model phase in the first phase which started with gymticket.com I had this idea to make a hotels dot com for health clubs. Yeah, and didn’t exist. This was 2006 so you know and what would be the business model for that. Well you know hotel sells the booking. Maybe we can sell leads to the gyms that was the idea I called the head of the the trade organization for gyms. This guy Rick Carro this place was called ursa. He partnered up with us. He was probably in his early sixty s I was you know 25 26 we just got going and he would help us find get access to the gyms and we would essentially find leads on the internet and then send them to the gyms and. Got to about 2000 gyms and we realized that you know when we got to a couple million of revenue that it didn’t scale. It didn’t scale to like you know much more and so we were faced with the choice. Do you go vertically or horizontally could you go deeper selling more to gyms or do you try to do the same thing you know more peanut butter to different. Verticals and it turned out that we we chose the the horizontal approach so we started doing the same thing we built a site called local vets.com and repeated that playbook and then did the same thing for chiropractors and then we did this over and over and over again and got to about 20 different verticals.

Howard Lerman: And about $20,000,000 of recurring not sorry, non-recurring media revenue because we were paid for performance by small businesses and we had a whole team of you know college kids right out of college cold calling small businesses selling leads. This was you know right? when the internet was. Really becoming mainstream and s and bs were stopped stopping. You know getting leads from the yellow pages because nobody was looking at print yellow pages. They were all looking on Google and Google Maps and so on and so we were able to offer really compelling value prop. But then that business hit a wall and so then what we did. Was we this is the crazy thing we did we sold that business the original business to iac interactivecorp and we incubated an entirely new company in the same cap table and a little complicated but we we actually did it in reverse order we we started this new company and then spun the old company out original company out sold it to iac. Use that capital to incubate power listings and here’s how power listings worked. You know it. It became obvious that the unit of local advertising and location-based stuff was going to be listings. Ah, you know that is a listing and it used to be in the yellow pages and now your digital listing is in Google it’s in. Apple it’s in Siri. It’s all these different places and so we built this cloud listing idea where you could upload. You know a company could upload its information into yext and we’d sync it across 100 different places that people looked to find a small business and that works so well.

Howard Lerman: It turned out that big companies started signing up for it and companies like you know all the way up to fortune 50 banks and fortune ah, you know fortune wall street banks and fortune 50 companies. Morgan Stanley Farmer’s insurance and they all wanted the same service that yaxt offered but for their. Many thousands of branch locations where Mcdonald’s has 12000 store locations and you can imagine the utility for them at scale of being able to upload all their location data and have it sync across every mapping service on the planet from one spot and that ended up just being a smash an absolute smash hit. And that and that business is what yex does today and is the leading provider of location data and listings to the biggest and most important mapping services in the world. So that you find the right mcdonald’s address or hours of operation when you go to look it up online.

Alejandro Cremades: And I mean obviously incredible success. But I guess say you know for for yet. What were the early days like you know what was that process of really putting that the team of of a players.

Howard Lerman: Very early days of Yaxt were characterized by just bloop Force I would suggest I mean literally we would you know I would bowl over marketing managers at Health clubs around the country. And get them to sign up for gym ticket. Ah you know I would we were just like heat seeking missiles that were hustling like crazy. Um, we had way more of a sales approach than we had a good product I will say that we had a great value prop pay only per leads. But we didn’t really make we didn’t invest in R and D to make something super defensible and super Awesome. We just were essentially arbitraging media and then building this network of Gems. Um.

Alejandro Cremades: So in that in that case too I mean you know for for this company. It was like your real experience at the super hyper growth like really raisingcing money to how did you guys go about raising money. How much capital did you raise prior to the ipo.

Howard Lerman: Yeah. Well look I mean I like to joke now I’ve been on all sides of this coin here and I’ve gone back to the first stage of the journey but look I’ve raised seed I’ve raised an a a b a c a d a growth an ipo a secondary a follow on. Ventured I mean you name it I’ve been there and at yext I think we if you were to total it up. We probably did 3 in the a and then this was back before you know an a round was now now an a round is 20000000 but back then an a round was 3000000 so we did you know 3000000 between a and b and then we did a. A $25000000 c a $50000000 d and then another 25 before we went public and then when you go public you put about 125000000 on the balance sheet we did. We did a follow on offering to add another 125 or so so yeah, we raised probably 20250 Somewhere in that range to 25.

Alejandro Cremades: 250,000,000 and when it came to really picking the right investors you know for the right reasons you know how was that process like I mean obviously at this point you know you were quite a seasun guy you know, even though very young. You know you had ah a few exits already you know under your belt.

Howard Lerman: Yeah, yeah.

Alejandro Cremades: So what was that process of making sure that you had the right people for the right reasons. So.

Howard Lerman: You know I think first off I mean everything has changed so much like if you look at the ecosystem today and 2023 versus what it was yeah the venture ecosystem was like back when I first got to know it in 2007 2008 2009. It’s totally different now you have all these. Solo capitalists that are out there that can throw half million million Two million dollar checks back you know and again I sound like I’m like a really old person here but back when I was doing this the for the first time twenty years ago it would there were really like I don’t know. 20 firms kind of that would do these and they were all they all kind of knew each other and they were all part of the same thing on sandhillroad in Silicon Valley 3000 sandho road specifically is where Sequoia is and ivp is Sutter Hill is on page mail road. Great I mean you have these. Benchmark and excel I mean there just wasn’t too many of them and you would hit them all and ah and you know for us the process. The process was actually and maybe we’re just again lucky here to use that word but we never really had to chase the money the money kind of always we did pretty. We would prefer to put up the results. Ajandro and and then have people come to us as opposed to like talk a big game and then you know, raise the money and then have to deliver I’ve I’ve always which by the way I think a lot of companies today are in trouble for having done that um you know for having raised money at super sky high valuations that are.

Howard Lerman: Fundamentally unsustainable and by the way the vcs are equally as guilty in making that happen because if you’re a first -time entrepreneur and someone shows up and you have 3000000 of Arr and they’re willing to invest in your company at 300000000 and put in 50000000 with no terms. You’d be an idiot to say no so ah, ah, there’s there are 2 parts of that problem that have happened there. Um, but the the game is completely different today than it was back back in 2000 and you know 2007 2008 just a completely different ballgame. You have all these different capital ah sources different types of funds classes of funds. And just an entire. They all have a totally different strategy than they did before too.

Alejandro Cremades: And I guess say for you guys, you know what? Ah what? an absolutely amazing experience with yxt I mean at what point do you realize that you know it’s time to to go public because I mean it’s a whole different ballgame where you are operating privately and you can move much faster. You don’t have the disclosure the reporting.

Howard Lerman: Yeah, yeah, yeah, well you know what we did was we brought in our cfo Steve Cakebred who is the cfo of Salesforce and was.

Alejandro Cremades: You know type of stuff you know at what point do you realize? hey maybe maybe we gotta we gotta go public here.

Howard Lerman: Cfo Pandora so he had taken 2 companies before yaxs public super experienced new wall street knew how to handle the banks knew how to handle investor relations do all the forecasting put in you know, real processes to become a real company I mean going public forces you to grow up. You. You have to have you know super. Concentrated ah you know, ah financials you you really good at forecasting. Um, you know it it forces you to behave in ah in a much more disciplined way than when you’re private now that comes with bad and good sides right? and the good side you become more predictable and you’re better and the bad side. You. You might be more focused on quarterly earnings instead of long-term success. Ah, if you’re not if you’re not careful that bad and people can get mad at r and d which doesn’t have a very you know short-term payoff. So um. Yeah, I’d say in 2014 when we hired Steve that was kind of the catalyst for getting getting out and going public which we did in 2017 it takes takes a couple years to get ready. You have to yeah yeah.

Alejandro Cremades: How Nerf How how nerve rocking was saying you know going on the Jet you know with the investment bankers. You know pitching people doing the whole pony show I mean how how was that experience too.

Howard Lerman: Well, you know the ipo roadshow is really ah, a unique thing. The banks. Their product is they put you on a private jet for two weeks and in return you get the privilege of flying around from city to city in the United States where each. Each day you do and I kid you not It’s starting at 8 am there’s a breakfast and there’s you know there’s a meeting every hour until lunch and then you do a lunch meeting and then there’s a meeting every hour until dinner and you do a dinner meeting and then you get in the plane and fly to the next city and so you end up doing probably ten pitches a day. Ah, with the bank that accompanies you over a two-week period. So you meet I’m guessing maybe between ninety you know, 80 to 100 investors over that time period and you just say the same thing over and over again you you have your your sort of dog and pony show in your pitch and by the end of the show you sort of get good at it. And you’ve been I guess rehearsing with your comrades in my case I had Steve with me and Jim Steele who was our president and head of sales and we were completing each other sentences. It was a trip to say the least and it culminates in a. And a crazy special day when you when you when you wake up and it’s time to ipo that day.

Alejandro Cremades: And now that you’re public you know is ah different ballgame I guess say for you as the experience. What was what what? what difference you know, did you encounter from you know, operating yta privately to then all of a sudden you know you’re the Ceo of a public company.

Howard Lerman: Yeah, well there, there’s a lot of differences but the first difference and I think this is the most important one is that when you meet with investor you have a new set of investors when you’re private your investors are all on your team. They are venture investors that. They’re going for depending on when they came in and valuation between a 3 and hundred x outcome and when you’re public the people that are buying that you’re meeting with. They may not be on your team because they’re allowed to short you so you don’t know if you’re. Talking to someone who is betting for you or betting against you and that is a really fundamental shift. That’s the first thing second thing is when you have venture investors they’re in it for at least 3 4 10 years in years when you’re public people can be in and out within a day. So you could be talking to traders not investors and you just have to learn to pretty much cut through the the noise to provide a signal that that these folks can use to do it. The other thing is that everything you do is is scrutinized. You know you’re talking to analysts that. Are modeling your business and have to give them clues and you have to be very accurate and very careful with what you say you can’t say anything that’s not correct.

Alejandro Cremades: So in your case I mean you’ve also had the opportunity of um of investing in other in other companies too As an investor you know, especially after you know yet, you know obviously you had daily liquidity. So I guess say in terms of investing in other companies.

Howard Lerman: Yeah, yeah.

Howard Lerman: Oh yeah, yeah.

Alejandro Cremades: What do you typically have experience as patterns between the people that succeed from the people that fail.

Howard Lerman: Well first off I need to just start this off by saying I am a terrible investor I am you know you you are much better in your audience. So don’t take anything I say as investing advice not for a legal reason. But for actual practical reason which is that I’m just not very good at it because I am a operator Alejandro I love to just get my hands on things and design things and go from 0 to 1 as opposed to you know, helping someone you know letting someone else do it so I actually have.

Alejandro Cremades: Right? right.

Howard Lerman: Learned this about myself so much so that I try to not invest in a lot of things because I just would be annoying to the founder and I don’t I don’t want to be too annoying because I you know I see things that they can do um and I and I don’t like it if investors that are in. You know my companies are telling me what to do? Yeah that’s just annoying so I’m not I’m not very good at this but it really I think comes down to the intersection of two things which would be the how good the founder is and how good the product or market fit is that’s it’s really that simple and I guess the third. Thing is ah is it is a lens on that which is the valuation. Are you gonna make money or not um and you know in the first thing I’m pretty good at judging the first thing and the second thing the third thing there’s professionals that are way smarter at me that that can judge that.

Alejandro Cremades: So in your case I mean what a run 15 years you know really pushing yet. You know that’s I mean 15 years in the startup world I mean in dark years I mean that’s like crazy crazy amount of time crazy amount of battles you know ups and downs. You know after you know like.

Howard Lerman: Yeah.

Alejandro Cremades: Bring the company to such heights. What really you know, brought you to the decision of you know, Maybe there’s something else that I should be doing here.

Howard Lerman: Ed yext over my time as as our founder or Ceo I always had to figure out how to grow and the way that you run a. 5 person company is totally different than a 20 person company and that’s totally different than a 50 person company and so on and so forth and you have to keep making adjustments to play a different game at each stage and do a different job and yes. Got under my leadership to about 15 about 1500 people somewhere in that range I at some point stopped being the best person to figure out how to lead a global company at scale and over by the way as. We grew in our first stages I was not shy or hesitant to replace people that were not growing correctly, you have to do it. It’s part of the journey when someone hits a wall or you know, kind of gets to their point of competence but the company needs more. You have no choice. But to replace them. It is the moral thing to do for both the company and for them and that person at some point about two years ago became me and so it became time to replace myself and so we did.

Alejandro Cremades: So. So What happened next.

Howard Lerman: Well I you know it was a discussion with the board and you know I think we were struggling in certain ways and I was trying and you know I was swinging everything I could possibly swing in every possible direction and it just became. Time for there to be a new person for me to pass the torch to and fortunately on our board. We had someone that was awesome and willing I don’t think we would have you know I think we sort of again luck is a recurring theme here and ah I think we kind of lucked out with with having Michael both. Present up to date and available so that you know when we started to make this discussion. We we decided that he would be the right guy and and we did it and I don’t look back at all and think that it was a mistake or. I don’t miss it at all I I feel like I fully gave and lived every possible moment that I could have and did everything I could to make the company great and part of that final thing was finding my successor every company has to outgrow its founder.

Alejandro Cremades: Yeah, now now in your case you know I mean 15 years is a long time. So what was that discovery process for you to really understand what will be the next chapter in your journey.

Howard Lerman: Well, you know I was like everybody else we went to zoom in slack during the pandemic and I was setting up a Zoom call one day and you know when you’re running a big company I was doing it with about 100 people and I forgot to add someone to the calendar invite and so at that moment. Was like shit if you forget to add someone to a counter invite a distributed company. They don’t exist. They’re a non personson so I had this flash ofs insight let’s make a bird’s eye view of all the people in the company you know meeting you can see everyone. It’s kind of like if you know Harry Potter like a marauders map for the company and that. Spark of insight gave me the idea for Rome which I am now leading today.

Alejandro Cremades: So at what point do you? Obviously you got the idea there. But at what point obviously you know I’m sure that you looked into this and you had that process for really figuring out whether is it was gonna be worthwhile or not so at all point there you like okay I’m gonna go for this one.

Howard Lerman: You know everyone’s advice after a fifteen and a half year journey where you know we we’ve achieved immodest financial success ah was don’t jump into anything take your time. Take some time off take it six months off a year off go on a journey of self-discovery enjoy this break and like a total knucklehead I completely ignored that advice and literally started Rome the next day.

Alejandro Cremades: Wow! So I guess say for the people that are listening. You know to really get it. What ended up being Rome and how do you guys make money.

Howard Lerman: Rome is a cloud headquarters for distributed teams and just to take a step back. You know I was telling you about the Zoom call where you know the person got lost in the ether we made this sort of bird’s eye view or had this idea for a bird’s eye view and. You know, right now in the world. There’s all this debate about the future of work and whether the future of work is going to be in the office or hybrid or remote or something else or some combination and frankly we at rome think it’s entirely the wrong question. Um, because. Ah, hundred percent of companies that are successful become distributed I’ll give you an example yes had offices from Berlin to Beijing. The best salespeople are always with customers. The best product managers are always with customers and engineers and the best engineers get to work and can work productively from wherever they want. And so you know during the pandemic companies really adopted Zoom to help them stay connected and Zoom in teams Microsoft teams and Zoom did a great job. They were the first company to really solve the video conferencing technology problem remember video conferencing before Zoom was off. And Zoom really helped us stay connected but it didn’t bring people together in the same way as if they were in the same real office and furthermore we’ve all kind of adapted our workflow around so now and so if you look at you know a calendar. It’s all full of meetings people have.

Howard Lerman: You know these long big boring meetings all day with too many people back-to- back. The meetings are too long things that used to take 2 people 5 minutes are being scheduled for Zoom calls next week with 8 people. There’s people that go to an office that drive to an office every day and they they sit on back-to- back-to-back Zoom calls. After they’ve driven to the office and so you know what separates I think what’s clear is that video conferencing technology is not a replacement for an office and bureaucracy has ah you know grown to the point where productivity is stalling in these distributed teams and so you know what makes. Video conferencing different than ah you know in this new distributed work world from a real office is a concept I call synchronous presence in real office. You can walk in and you get a feeling for who’s there and you can see who’s present and you can. Ah. You know taps them on the shoulder of inspiration strikes to have a quick conversation and and that in a in a remote or distributed world is all lost it’s lost in a world it’s all missing in a world from videoconferencing. Um, and so what we need to get back to is a world in which. The workflow is one where distributed companies can be distributed but still work together as if they were in 1 headquarters and that’s our mission at Rome to bring a whole company together in the cloud headquarters from anywhere as if people were working together.

Howard Lerman: In real life and we just started it like I said we started building it a little while ago and we only made it in our private beta two months ago and it has exploded um and we’re just really trying to hang on to support the customers we have while we implement the features that they demand. Um.

Alejandro Cremades: That’s amazing I mean absolutely you know very much needed and it sounds like you guys have hit a nerve there now in your case you know Obviously you know this point you had done very well for yourself, you know, especially you know, given the prior ventures. Why did you take money from outside investors here.

Howard Lerman: Well, you know I thought a lot about that I talked to Mark Benioff’s people about that for a while I I did by the way this wasn’t publicly reported. But I also did put in 12,000,000 of my own money into the company and I thought about. Funding the whole thing and the reason I didn’t was because there’s a chinese proverb old chinese proverb if you want to go fast. Go alone if you want to go fargo together and one of the things that was fortunate is that given that I’ve been on the other side here and I’m coming back around. I kind of got to pick the people I wanted to go on with and so in our cap table. We’ve got juules from ivp who you know I worked with a y for 12 years and fifty five Five Five incredible entrepreneurs that have been my friends for. Ah, decade and so to be able to call on guys like that when you need them and be able to get introductions or help or product feedback. You know when you need it, you know as opposed to just keeping it all for myself. I’m not trying to make something that I just you know that’s like Howard’s fun house that I own. You know, just for the sake of having a fun house I’m trying to make we’re trying to make it. You know a company and a company has multiple stakeholders and multiple people and lots of people involved and so it just you you want to go you want to go far here and you want to do it with other people.

Alejandro Cremades: I love that now as you’re thinking about going far and also what the future holds here for Roman and for the team you know if you could go to sleep tonight and you wake up in a world where the vision of rome is fully realized what does that world look like.

Howard Lerman: Yeah.

Howard Lerman: Um, we want to build the default h queue for every company on the planet big and small and we want everyone to log everyone when they when they’re ready to go to work whether they’re in the office or they’re remote or they’re somewhere else they log on and they’re in Rome. And they see a visual representation of a company’s headquarters and they can see from a glance who’s there they can ad hoc tap people if they want to talk to them when inspiration strikes and if they want to. Leave their company building. They can jump and visit another company and see that company’s Hq we have this big vision for building a way for every company to have an Hq and today we have. You know, certain types of rooms but we we intend to add you know all kinds of new rooms to to Rome.

Alejandro Cremades: That’s incredible now we’re talking here about the future. So let’s take a look at the past and be able to reflect on it. You know, let’s say I was to put you into a time machine and I’m able to bring you back in time back in time to that moment that you know you were still you know at Duke you know.

Howard Lerman: Yeah.

Alejandro Cremades: Doing your first gig you know, figuring things out you know building your first business imagine if you had the opportunity of having a chat with that younger Howard and being able to give that younger Howard 1 piece of advice before launching that first business. What would that be on why giving what you know now. Yeah.

Howard Lerman: I would say focus make sure you focus on your existing customers more than new customer acquisition I know that’s I know that’s um that’s not like insightful and Buddha and you know Mr Miyagi or whatever.

Alejandro Cremades: Can you expand a little bit on that.

Howard Lerman: Yoda I I really just was always in such a rush to grow the top line as fast as possible when I was you know, starting early days of x and everything else and you want to make sure you have the product right before you sell something people don’t need. And net retention is the most important metric in any business.

Alejandro Cremades: Yeah, 1000% well Whoward this was this has been I mean imagine imagine that’ll be absolutely unbelievable now for the people that are listening homeward that will love to reach out and say hi. What is the best way for them to do so.

Howard Lerman: I hope I hope I can get a thousand percent never retention.

Howard Lerman: Well, you can do you can find me on Twitter at Howard I’m on og Twitter handle. Ah you can find me by the way. Rome is at Rome if you want to check out Rome and you can always email me H At R O Dot a m.

Alejandro Cremades: Amazing. Well hey Howard thank you so much for being on the deal maker show. It has been an honor to have you with us today.

Howard Lerman: Um, thank you.

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