Sagi Rodin On Raising $70 Million To Help Other Businesses Innovate Faster

Sagi Rodin took his passion for technology and value creation to launch his own startup that is growing fast in its mission to enable others to innovate better and faster. The venture, Frontegg, has attracted funding from top-tier investors like Stripes, Insight Partners, Pitango Venture Capital, and Global Founders Capital.

In this episode, you will learn:

• Finding the right investors for your startup
• Raising $70M for your startup
• How being someone who embraces high stress will help you as an entrepreneur

SUBSCRIBE ON:

Also Wingman is sponsoring this podcast. Visit https://www.trywingman.com/dealmakers for more details!

This podcast is sponsored by BetterHelp. Visit betterhelp.com/dealmakers to get 10% off your first month.

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 Sagi Rodin:

Sagi Rodin is the CEO and Co-Founder of Frontegg. Over the last 15 years, Sagi held senior product and software development positions leading engineering and product teams and engaged with ad hoc projects of building customer-facing software applications and transforming concepts into viable products.

Connect with Sagi Rodin:

• Crunchbase
• LinkedIn
• Rocketreach
• Facebook
• Twitter

Read the Full Transcription of the Interview:

Alejandro Cremades: Alrighty hello everyone and welcome to the deal maker show. So today. We have a very exciting guest. You know that is coming with us again coming from startup nation. You know, incredible founders. You know coming from Israel but they were gonna be learning a lot about building scaling financing. You know. You name it all the above all the good stuff that we like to hear so without farther ado let’s welcome our guest today saagy roin welcome to the show. So originally you were born in Russia.

Sagi Rodin: Alejandro great to be here. Thanks for having me.

Alejandro Cremades: But then you know you ended up being raised in Israel so give us a little of a walk through memory lane. How was life growing up.

Sagi Rodin: Um, it was great. So you know, um um I was born in St Petersburg which is ah one of the most beautiful cities in the world I um came to Israel when I was 5 um, and and you know since then I’m ah. I only remember Israel visited Russia a few times but that’s mainly it you know, growing up was great. Israel is a great country to grow in and and grow up in Israel is. Is a great experience. You know the weather is great. The food is great. People are awesome. So all good stuff.

Alejandro Cremades: Now in your case I mean you started programming quite early. So what got you into computers.

Sagi Rodin: Yeah, so you know I think that the kind of the need to provide value and make ah life easier for people. Um I just found that with the programming especially in the web space is kind of Ah, great place to to just make things and make them fast and have people using that so that was always what I liked about you know what? they call today full stack development that you just build something it. It doesn’t just show up on ah on a black and white screen. But you actually can create you know websites out of it. You can create experiences you can create products and immediately kind of launch them and have people using them and providing feedback. So for me, it was always exciting like this value creation abilities. And I guess that I found that in programming.

Alejandro Cremades: Now obviously ah one stop that is necessary for everyone in Israel is the army. So how was the army for you I mean what? what? What? What? What? What were you? What were you able to learn from that experience first.

Sagi Rodin: Yeah, you know I think that I always say that an army a lot of people come to me and say listen if I don’t serve like this ah combat union units then I don’t make real army. But I think that a lot of the army experience and why it’s important in Israel. Is that you realize that you’re going to do something that you’re not going to get paid for or almost don’t get paid for for 3 years you know for men it’s three years two years for women and I think that um you know acknowledging that you’re actually doing this contribution not for yourself. But. Ah, for something that is a greater cause is something that always I I found fascinating and I think this is kind of unique in the israeli landscape and also probably what one of the reasons that makes israeli so successful at the end. So for me, it was a great experience I got to deal with a lot of interesting people. You know an army in Israel is kind of like a melting pot of everybody that no matter where you came from what social economics or you know. Ah, what house you were raised in and I think that this is great to meet a lot of people and work together. Um I also you know was lucky enough to deal with things that I liked. So um I got a chance to mentor people.

Sagi Rodin: Work with stuff that I fell in love with later which is databases. For example, 1 of the most interesting things that I got a chance to deal with so overall a great experience I think experience that definitely kind of builds you up for future endeavors.

Alejandro Cremades: So in your case I mean obviously having started programming at 12 you knew that computer science. You know what say the next stop. You know, being able to study that now once you did you know your degree in computer in computer science. You know, essentially you started you know working you know in different in different companies. Ah and you even you know tried a few endeavors of your own. So what happened there.

Sagi Rodin: Yeah, you know so I studied in ah in technon in technion. Um, you know it’s a very demanding place. It’s like the the mit of Israel a great institute to learn it I studied software engineering there. And um, and at 1 point like I think the third year I started to do some projects of my own and even launched a small company of my own which ah, which was great because there’s a lot of flexibility in you know, studying and and also making some money then after I finished there, you know me and a bunch of friends. Um, did some projects ah together. Um I think that before you kind of work in an environment where you get a lot of um feedbacks a lot of time ah to ah to kind of time to fail time to learn. And um and a chance to work with great people. It’s really hard to go and um and you know start a crazy thing like launching a startup. So. So for me I would always recommend before you going unless you have like this. You know, amazing opportunity or amazing idea or something like that. Um you need to be prepared for something like that because you know it’s serious thing you raise money you have a lot of responsibility you hire people so you need to come prepare, especially if you’re going to be the founder and especially if you’re going to be the Ceo of that.

Sagi Rodin: Um, so I think you know it was um, a lot of things that we learned from but up until the next kind of jobs that I had where I actually had the opportunity to work with people that already launched startups before you know, succeeded failed I wasn’t really ready. For what we’re doing right now. Um at frontex. So definitely. Frontte is the first serious startup that that I launch.

Alejandro Cremades: Now the se way before front front egg was I mean you did your few endeavors you you worked out a startup tool but then checkpoint you know was the most immediate step before front take So Can you walk us through what were the sequence of events that happened. In order for you to really come across the ideal fronted front egg and then for you to be like you know what? I I think this it makes sense to give my notice and go at it with this this with this business.

Sagi Rodin: Yeah, so when my first kid was born in 2015? Um, I said this and I have to go and as I as I mentioned like ah, um, learn a bit right? prepare myself because it was always clear that I’m going to do something on my own. Um, and I think that you know I started 2015 I went to manage a small team. Um in ah checkpoint it was a startup that was acquired by checkpoint. So I kind of started. Um at the time that it was ah already kind of moving to to checkpoint post acquisition. And um, and from there you know I just did my thing so I managed the team after um, a year I think less than a year I kind of moved up to managing a group of people so there was several teams that we in charge of the whole mobile security. um within the checkpoint of the products there um and after that um you know I was kind of seeing that there’s a lot of movement that is happening in the industry in the b two b sas world so more and more products were moving to a saas approach. And when I started to play with those products I saw that you know most of them kind of behave very similarly in the way that the users manage everything within their product. So I did a research and took like um I think.

Sagi Rodin: Ah, 4 5 6 products that checkpoint already had in the in the sas b 2 b space and showed the similarities that they had and we found a lot of common capabilities there and then I went and kind of researched. Okay, how is it being developed. How is the user experience being chosen and and what I saw that each time a product needs to be launched. It’s kind of you know there’s a reinvention of the wheel happening right? because the collaboration doesn’t work so so well and um, and. Basically I said okay, why we’re doing that if we have 6 products right now we’re going to have forty fifty in ah in few years from now. Ah so we’re spending a lot of resources. We’re spending time and we’re also making it hard for our customers to use something that is more unified in the experience. So I went and launched a platform there along with a via today my cofounder ah platform for saas application and it was a big success. Um, and then you know studying this area of of b two b saas applications outside. We saw that basically it’s the same. At the outside world. Um, so you know same challenges different solution but but we wanted to make it easier for companies to launch. You know, high quality high standard ah b two b products.

Sagi Rodin: And and this is where frontte. Um, ah started late 19 both myself and a vyat we Left. We started to research started to talk to potential customers and and you know this is ah it was kind of clear for us that this is what we’re going to do This is our passion. Ah, this is what we’ve been doing for many years creating solutions for B Two B and now you know let’s help others to create ah better Solutions. So That’s ah, that’s how it went.

Alejandro Cremades: So for the people that are listening to get it. What ended up being the business model of front egg. How do you guys make money.

Sagi Rodin: Yeah, so we are Sas as well, right? So it’s kind of like a Sas for us. Ah product. Um our customers would typically be ah b two b companies we have customers varying from small startups. 2 fortune 100 companies. Um, so you know they all basically struggle with the same from the same struggles and challenges and and we charge by the amount of activity that you have within your product so you incorporate us. Be a part of your product and that’s basically the value that we’re providing is your users um using our capabilities within your product. So as you will grow with the amount of usage the amount of customers that you have the amount of users you have. Ah, you will pay us. Basically upon that.

Alejandro Cremades: Now what were the early days like you know when when when you made that switch from checkpoint. What what were the early days like with the company. So.

Sagi Rodin: Yeah, so you know we started kind of late 2019 then the covid hit so I will say that you know it’s definitely kind of unique time to to start a company. Um I would say that the challenges and the biggest challenge I think that you have to overcome. Ah, is hiring the first employees right? So I think that the first 3 4 employees would be kind of the founding team and it’s very crucial first to hire like amazing people there they have to be amazing from the technical point of view right? professionally. But also they have to feed. Ah culture certain culture that you want to build for your organization. Ah that along with the fact that you know when somebody comes to an office and nobody’s sitting there only 2 founders with a crazy idea makes it ah a big challenge to you know to bring good people on board. And I would say that this is you know, definitely been challenge number one even before you know raising money. Ah bringing first customers. Um, this is the first challenge at hand.

Alejandro Cremades: Now in your guys’s case I mean how did you guys go about you know, really choosing you know for innovation instead of like just being one more you know 1 one 1 more of the of the same. No, what’s going on. So.

Sagi Rodin: Yeah, yeah, you know when we went to investors at the beginning and said is ah, want to make like this Sas capabilities shop basically where you will just get a lot of Sas capabilities that will help you? um. Make a better product. They were all saying listen it’s it’s ah everybody likes best of breeds and you cannot be really a platform from the beginning and some of them said listen we are not going to invest money in that right? we want like this specific small value that you’re providing and that’s it. Show us what’s that value and we were going from investor to investor and saying but this is what we do. We’re going to be a platform um, and and I understand if it doesn’t fit your thesis. that’s that’s okay so so yeah I would definitely say that in our case, bringing. Ah, kind of the the platform idea and innovating in this b two b space where there has not been almost any innovation in the last ten years everybody were about like creating these very generic infrastructures without taking actually a stand. Um, an opinionated stand on how things should look for the end user. So even today if you try to count the amount of products that are actually incorporated within other products on the user experience part of their user experience.

Sagi Rodin: Ah, you wouldn’t find a lot of them right? So you would find stripe and and maybe some more but not a lot of them and I think that you know looking forward. This is what will happen because you know if a certain part of your product is already solved then you don’t need to figure Out. What’s the best you either.? How to scale it how to create an infrastructure. Um, others have already done. It. So you know, just customize it and integrate it within obviously that needs to come with a lot of flexibility. A lot of freedom for the designers and developers to still express themselves. Um, and I think that this is kind of always the balance that we’re trying to provide provide something that is already kind of figured out and it’s plug and play but still very flexible and allows our customers to customize everything and you know configure everything. That’s what we do.

Alejandro Cremades: So so let’s double click on that How much capital have you guys raised to date. So.

Sagi Rodin: Yeah, so we raised $70,000,000 ah, the last round was 40000000 which was raised. Um in june this year um and before that we raised the serious a round. Of twenty five million and five million dollars sid round

Alejandro Cremades: And how have you seen the expectations shift from investors from 1 financing cycle to the next.

Sagi Rodin: Yeah I think that you know we chose our investors in a way that they understand the importance of making great products. So I think that both um you know pitango and starting from I 3 which is a small fund. Ah, that were the first to fund us global funders capital and now insight partners and stripes. Ah definitely um, understand the importance of great products and and you know they when they spoke to our customers. They just sold the love that our customers have. For our products and I think that this is the most important thing you know, understand that there is a market to understand that the market is going to love your product. Ah so that’s ah, that’s has been like the focus I will say that you know we definitely see scale up happening since ah, the less. Ah. Um, investment or a bit before that. Um I wouldn’t tie it like completely to raising the seriesb. Um, obviously it helps it also helps to have a new Vc like stripes along with us in this journey. But but yeah now. We’re moving more to the us. So I actually moved the family here a month ago. Ah to build a go-to-market motion. So we’re building the sales and marketing team here developer advocacy you know. So now we’re at the bay area as well.

Sagi Rodin: Um, having a very strong foundation of product and engineering in in Israel um, you know that’s the foundation to build a great company I think that everybody are kind of leaned on that.

Alejandro Cremades: So tell us about the you know the the really coming I mean why Israel why leaving Israel and coming to the us I mean what was the ah the intention there and and what was that experience like so.

Sagi Rodin: Yeah, you know? So first of all, it’s very new so that’s actually the first podcast I’ve been doing from here. Ah so you know so I always always remember it. Um, but but you know it’s still happening so we moved like ah three weeks ago um and um and it was obvious that it’s going to be a challenge at least you know from the family side but also on the company level right? So it’s a new reality for everybody. A new reality for the management and for the employees to have ah the ceo moving. Um, so far away with a huge time zone difference. Um I think that ah the reasons. So I always say that there are 2 main reasons I think that um, we’re building products for developers and I think that you know this is the place to be um. You know, building products for developers. So the ecosystem is here. Um, the customers are here and the the second reason also tied to that is that um I think that that there is a great talent in Israel. But I think that when you’re selling to developers and selling. And most of your market is the us and you’re sending to them. It’s important you know to also bring talent that has experience in that and I think that most of these go-to-market talent is located here at the us the combination of having very strong people close to the product people in Israel.

Sagi Rodin: And having strong engineers there laying the foundation for the product and having a very strong go to Market Leadership Strategic leadership here I think that’s the key to to success especially in our use case.

Alejandro Cremades: And in your guys’ case I mean also for you as the Ceo and founder I mean you guys got started here with the business before like craziness you know pandemic now economic stuff happening. How has it been for you too to adjust to the. To the realities to the factors that are outside of your ah control like covid or now you know like the the macro economic environment I mean how has it been that adjustment for you too.

Sagi Rodin: Yeah I think that one thing that I find in many founder colleagues and definitely find on my about myself is that we always keep o ourselves like at a very high stress level right? So we’re never like calm. We’re never sitting and saying. All things are great. Let’s chill so I would definitely say that if there is no covid and no like shift in the market. We’re still kind of you know, very anxious about the business about everything that’s just you know? Yeah I think that that what makes ah founders. Ah, good. You know, being able to deal with ah with all this uncertainty and with all the craziness. So I think that when something like that happens. Ah, definitely that would help us deal with it. Um in um, in a better way. Ah, not to be stressed out by that right? So so it’s always keeping like a high stress level probably and b and just being able to to deal with it. So I would say that. Definitely you know we started the company and then covid heat. Ah, we moved to a new office I remember when we just ah launched the company in nineteen and two weeks later so it was a wework office two weeks later um they would just close down the office and we signed the list and we were like oh wow we have a list now and what are we going to do.

Sagi Rodin: And then there was ah you know quarantine in Israel so we couldn’t even meet for ah for a few months and then the challenge of hiring first people like ah when you cannot meet them. Um, and now obviously things are ah shifting as well. So. Um, a lot of things happen in the world especially in the tech saas world. So I will definitely say that we just need to deal with it and we need to make the right decision all the time and even today luckily for us, you know we have a very strong foundation. We build a team that is capable. Of dealing with hard things is capable of hearing hard news and dealing with it and and I always say that when you hire your management you need to open everything right? So at frontend. It’s complete everything is completely transparent you have access to all of the data. Right? As long as it’s not violating any privacy. So and you just need to be able to deal with it. Even if it’s bad. Um, so I would definitely say that you know if you hire people and they are only going to be good if everything is good. Those probably are not the the right people for a startup. Um, and that’s what we feel today.

Alejandro Cremades: So to get an idea on the scope and size you know for the folks that are right now tuning in what I mean anything that you feel comfortable sharing like number of employees or anything else.

Sagi Rodin: Yeah, so frante ah today employs ah about 50 people. Um and a bit more than 50 people. Um, and that’s both in Israel so most of the engineering team in Israel we have engineers in europe as well. Um, and now building marketing and sales leadership at the us and yeah, we’re serving about more than 200 companies today. Everything varying from small startups to.

Sagi Rodin: Ah, fortune 100 companies. Um and and you know we service their critical infrastructure. It’s no no joke right? So if a product like ours is down. There’s no product for our customers. So that’s a lot of responsibility and you need to build a very strong foundation. Ah, to be able to to deal with it. Um, and and that’s ah that I will say a bit about us as you said we raised around $70000000 in total and growing fast.

Alejandro Cremades: So now imagine you were to go to sleep tonight and you wake up in a world where the vision of front egg is fully realized what does that world look like.

Sagi Rodin: Yeah I think that in a world where it’s realized you would get to like any product. Um that that you want to launch especially in the b two b space but not only. And you don’t have to worry about the like encore foundation of the product. So if you want to innovate you can innovate purely with the new exciting things and with the core value that you bring to customers I think that today you still need to deal with a lot of. Oncore stuff the table stakes capabilities. They take a lot of your focus from actually achieving um your goals and achieving kind of the you know the real value of why customers pay the money for your product and for us. That’s always been the vision to help others innovate in a faster better way.

Alejandro Cremades: Now if I was to put you into a time machine. So again I bring you back in time to ah, let’s say you know like maybe that moment where you were coming out of University after having studied computer science and. You know when you were like doing your your little projects here and there and and you had the opportunity of having a chat with your younger self and giving your younger self one piece of advice for launching a business. What would that be and why given what you know now.

Sagi Rodin: I would definitely say go as early as you can to work with strong people that have already achieved kind of what you’re up for right because I think that there’s no value bigger than you know working with those people. Together and learning from them. Um, and I would never like say to this ah you know 23 year old go and launch a startup immediately. No because you know that 23 year old. He wasn’t ready for that but to be there not spend time and work in places that would really. Help you to get there when you are ready I think that’s the most important thing so I would definitely tell people you know, think of what your it is like that you’re trying to achieve like in 10 years from now and now you have to do the things that will help you get there. Um, don’t don’t spend time like on on anything other than that.

Alejandro Cremades: And just had a career city like how do you know? let’s say like you go and you work with people that that could help you or maybe like a started that will give you the chops at what point do you realize that you know now that you are able to look back. You know in time to maybe that you realize that you’re ready. Because you’ve you’ve been alluding to that to certain degree. Yeah at what point do you know you’re ready to to start something.

Sagi Rodin: That’s a great question. Um I think that you never really know. Ah, but um, that’s a matter of kind of risk management right? That’s something that we as founders always do ah you need to feel ready enough I guess right? So You will never be like 100% ready, But not doing anything and expecting that you know you’ll just be able to solve everything I see too many people that are going in those directions like not for the right reasons when they are not ready and usually the results are not good, right.

Alejandro Cremades: Nap.

Saji Rodin: Um, so definitely like learn from the experience of others that would be my ah my advice and when you feel ready enough. Um, that’s you know that’s the the time Obviously for me I’m um, I’m a person that always like to do things in parallel. So for example. Um, you know, starting out a family for me. It gives a lot of confidence in my life to also do and achieve more things new exciting things. So for me, it’s kind of the foundation for everything and this is also was part of the cues for me of ah when is the time.

Alejandro Cremades: Love it now for the people that are listening. What is the best way for them to reach out and say hi.

Sagi Rodin: Yeah, so just write me at say at fronte.com and you know I’m always glad to chat.

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

Sagi Rodin: Thank you Alejandro honor to be here.

* * *
If you like the show, make sure that you hit that subscribe button. If you can leave a review as well, that would be fantastic. And if you got any value either from this episode or from the show itself, share it with a friend. Perhaps they will also appreciate it. Also, remember, if you need any help, whether it is with your fundraising efforts or with selling your business, you can reach me at al*******@pa**************.com

 

Podcast: Play in new window | Download

Subscribe: Apple Podcasts | Spotify | TuneIn | RSS | More