Eric Rea is the co-founder and CEO of Podium, the messaging platform for businesses.
Podium – The ultimate messaging platform.
3 Value Bombs
1) A lot of businesses don’t show up when we search for them online even if they had been in business for decades.
2) Don’t let a couple of opinions weigh you. Back up your own intuition with the data of your business.
3) There’s always people trying to compete with you. If you’re not innovating and not taking your leaps of faith, you’re not going to scale your business.
Podium: A business messaging tool that brings all your messages into one centralized inbox. You need to be texting your customers, and Podium can help! For a limited time, sign up for 20% off your plan at Podium.com/fire!
**Click the time stamp to jump directly to that point in the episode.
Today’s Audio MASTERCLASS: How Solving His Dad’s Online Review Problem Led to Big Business with Eric Rea
[1:04] – Eric shares something interesting about himself that most people don’t know.
- He has 4 kids under 5 years old. He had twins during the pandemic.
[1:48] – Eric shares what Podium is, who uses it, and why.
- Podium is a messaging and payments product built specifically for local businesses.
- It is used by any business with physical presence that does interaction with other customers in person.
[2:24] – A quick example of a company that uses Podium.
- A carpet cleaning business uses Podium to interact with customers all the way from scheduling appointment, to payments, to getting customers, and to having customers come back.
[4:06] – At what point did Eric know he was an entrepreneur?
- He’s been an entrepreneur since he was 10 years old.
- His experience and understanding working at a local business gave him the idea to start Podium.
- Local businesses are not equipped to handle someone finding them online. They started Podium with that in mind.
[8:05] – What was the transition like from creating a simple product and helping your dad out to becoming a high-growth SaaS (Software as a Service) platform.
- Some of their customers are the largest retailers and healthcare providers in the United States.
- It was really empowering to see Y Combinator double-down on Podium and make it their largest investment.
[14:37] – Eric talks about the moment he knew Podium was a business that he would flip someday.
- With your first business, you’re terrified from day 1 that you will screw things up because you won’t know what you’re doing.
- They got through the first three years by meeting as many people as they could, listening to podcasts like Entrepreneurs on Fire, and listening to people who had been successful (and to those who weren’t).
[17:02] – What is the specific pain that local businesses feel, and how does Podium solve that?
- A lot of the businesses they work with don’t show up when you search for them online – even if they have been in business for decades.
- Podium helps businesses get reviews on sites where consumers were looking. It helps businesses get discovered.
- They make it easy for consumers and businesses to connect and go through the commerce experience.
[19:13] – Eric’s advice for those who have a business idea that’s a little less “conventional” than your typical enterprise SaaS.
- They were told by very experienced people that they should change their business model. They were told again and again that it was a bad idea.
- Don’t let a couple of opinions weigh you. Back up your own intuition with the data of your business.
[21:42] – Eric’s key takeaway and call to action.
- Go to your uncomfortable stage, take a leap of faith. Every time you do that, you’ll be rewarded.
- There’s always people trying to compete with you. If you’re not innovating and not taking your leaps of faith, you’re not going to scale your business.
- Podium – The ultimate messaging platform.
- Podium Starter – Free, easy-to-use messaging tools. Start using Podium for FREE today!
Boom, shake the room, fire nation. JLD here with an audio master class on how solving a parent's problem led to big business to drop these value bombs. I have brought to Eric Rea on the mic. He is a co-founder and CEO of podium, the messaging platform for businesses and today for our nation. We're talking about how to find product market fit. We're talking about the experience Eric had at the amazing startup incubator Y Combinator and why he was successful in getting funding with them. And so much more. When we get back from thinking our sponsors, did you know that 97% of text messages get opened and 90% are opened within three minutes.
You need to be texting your customers and podium can help for a limited time sign up for 20% off your plan at podium.com/fire. Eric say what's up to fire nation and share something interesting about yourself that most people don't know
1 (1m 1s):
What's up. Fire nation. One thing that you would not know about me is I have four kids under the age of five years old. I had twins during the pandemic and it's been a wild ride.
0 (1m 15s):
Well, as we shared fire an issue at the beginning, we're talking about how solving a parent's problem led to big business and how Eric is quite the parent himself. I mean four kids under five, God bless you. Fo show. And I fire nation. I'm excited to chat with Eric because he's rocking quite the company these days called podium, which is the messaging platform for businesses. So in plain English, Eric, let's explain to fire nation what podium is, who uses podium and why?
1 (1m 48s):
Yeah, that's great. So podium is a messaging and payments product built specifically for local businesses. And so our customers are any business that has a physical presence that does interactions with their customers in person.
0 (2m 3s):
So if you're a brick and mortar business, your using podium, if you want to maximize the conversations, you're having the message you're having with other businesses with other customers as well. Obviously what's like maybe a quick example of like one of your favorites companies that uses podium
1 (2m 21s):
Is one of our long-time customers. We have a carpet cleaning business. That's in the Western United States. They have dozens of locations and they use podium to interact with their customers. From the time somebody finds them on Google or their website all the way through scheduling an appointment and through paying for that appointment and then following up and then Mo most importantly, getting those customers to come back again and again, and use them and their services.
0 (2m 47s):
I mean, fire nation. This is the thing that a lot of businesses just don't quite grasp is you work so hard. You work your little booties off, getting somebody to visit your site or to read some blog posts you wrote, or to hear you on a podcast. And then they go check you out. And then the conversation ends because you're not following up. You're not messaging them. You're not nurturing them. You're not communicating in any meaningful way. And guess what they slide into your competition's funnel. It happens all the time in the worst part is you don't even know what's happening. You didn't even see it happening podium. And my experience has been that company that keeps you focused, keeps you drilled in and keeps your customers on board with you.
0 (3m 28s):
So when they come, when it comes time for them to make the purchase to go all in, you are top of mind. You're the person that they've built relationships with because you are staying in touch in contact. That's why I wanted to bring Eric on because I just don't know of a company that does it better. And I want to kind of tell fire nation about some of the background research I did about you. I saw that your job before you started podium, Eric was actually working at the UN at the international atomic energy agency. So to say the least a little different from what you're doing right now. So what point did you know that you were an entrepreneur and you made that jump into podium?
1 (4m 7s):
I've always been an entrepreneur. My father is an entrepreneur. He started at a tire shop in some gas stations. So this is a little different than software, but I always knew I was an entrepreneur. Even when I was 10 years old, I used to gather up all the neighborhood kids and give them plastic bags and we'd go gather golf balls at a nearby golf course. And then I would wash them and give them to my dad. So I've been an entrepreneur from this time. I was 10. The reason I started podium and the whole reason podium exists today is when I was in high school. I worked at my dad's tire shop in Canada, and I worked in the front. I fixed tires. I helped customers.
1 (4m 47s):
So by the time I graduated from high school, I had this experience and this, this understanding of what it was like to run a local business. And I didn't think it was helpful at all at the time. But fast forward, I went to school, studied computer science and business. And while I was in college, I, I started an e-commerce business. And so this was in 2012. I started an e-commerce business. I was selling iPad cases online from my dorm room. I thought it was an amazing business at the time. Turns out. I didn't understand gross margins very well at the time, but it blew me away that I was running this business from my dorm room.
1 (5m 31s):
And I had 10 times better technology than my dad's tire shop did to drive commerce. And just for context, I had built that e-commerce business on Shopify, which is a fantastic platform. And I just thought, I didn't know why there wasn't something like Shopify, but built for local local businesses specifically. And so started. I got together with my co-founder Dennis steel, awesome, a classmate of mine. And we started looking around and we just couldn't find anybody building a platform that would help drive commerce for local businesses. Like you had into it doing back office accounting, things and square doing payments, but there was just nobody doing what we thought was this obvious problem, which is these local businesses are just not equipped to handle somebody, finding them online and then taking them through that funnel of consideration negotiation, scheduling payment, you know, actually rendering the service or delivering the good and then getting them back again.
1 (6m 32s):
And again, we just didn't see anybody doing that. And so we started podium with that in mind in 2014, with nothing but a, you know, a couple thousand bucks in a bank account. And, and just this idea that we could build something big and fast forward to today, we have over 60,000 businesses that use our product. And yeah, to say that, to say that we happened upon a massive market, that was being underserved as a understatement.
0 (6m 57s):
I mean, foundation, I can't tell you the amount of times, I've literally yelled at my computer screen saying, I'm trying to give you money. A company X, Y, Z, like you're making it so hard for me to give you money. Why won't you let me give you my money. Like, it's frustrating. It's just like, I know these brick and mortar businesses, they're trying hard and they want to make the sale. They want to do right by their customers. But they're overwhelmed. They're swamped. They're taking this really difficult, hard road when it doesn't have to be that hard because there's companies like podium that really make these things simple. So if you're listening in your brick and mortar, if you're a regional business, you're look, whatever it is, like, make it easy on your customer. Don't let your customer yell at the screen. Like I yelled at screens and times like, take my money.
0 (7m 39s):
Like you're not letting me do just that one thing that you did that I thought was pretty cool. Eric was you made this jump into this amazing startup incubator that I know a lot of my audience has heard about call to Y Combinator. And they ultimately made you one of their largest investments in your most recent series C. So what was that transition like between creating a simple product, helping your dad out to becoming such a high growth SAS platform now of course, financial SAS being software as a service.
1 (8m 9s):
Yeah. So in the beginning we just were trying to solve the problems that we saw my dad's tire shop had. And we didn't, I mean, we know we knew there was a huge market of local businesses, brick and mortar businesses. And that, that needed something like what my dad was experiencing. But we, at the beginning, we were just thinking if we can solve his problems, then we can probably solve problems for hundreds of other businesses. Little did we know it's actually millions of businesses that need this? And so we started selling the product door to door. We built the product in two weeks. We thought that this, the initial product could be this really simple MVP. We built it. We started selling it door to door and what we realized, and this is through tons and tons of iteration.
1 (8m 55s):
There's I think it's actually part of the formula of success that we've figured out is through, through like months of selling door to door and then getting rapid feedback. We realized that this problem we were solving like 80% of the businesses we'd walk into would want it buy it. And it was, it just seems so it seems so rare that you would walk into a business and 80% of the time they would buy something from you. So we, we knew we were onto something from the beginning. We knew we had some kind of product market fit, even though we didn't really know what we were doing. Cause it was, we were both first time founders of a software business. But, you know, we did that raised a little seed money after we gained some traction.
1 (9m 36s):
And then we, we applied to Y Combinator. This was in 2015 and I actually watched this morning, Dennis and myself, we watched our, our original video that we sent into Y Combinator to apply. And it was actually hilarious just how much we didn't know. But Y Y coder X accepted us into their 2016 winter cohort, which is only four years ago. And they did that because they, they, they, they saw that we had product market fit in this really interesting market, which was a local business. And by the way, I think one thing to add is we started out solving problems for businesses.
1 (10m 20s):
Like my dad's tire shop. What's been really cool for me to see as a founder is we now serve some of the largest businesses in the United States. Like some of our customers now are the largest retailers in the United States or the largest healthcare providers in the U S I think one of our customers is the largest healthcare system in the U S. And so this product has actually grown from this simple thing to help my dad's tire shop to a platform that served not only small local brick and mortar businesses, but also some of the largest businesses in the United States that happened to have these in-person interactions with their customers. And it's just been, and so we went through Y Combinator in 2016, and that was fantastic, that, that took us to our series, a funding, which was led by Excel and Google ventures and a few others.
1 (11m 7s):
And, and then earlier this year during the pandemic, right after I had had these twins and the house was crazy, we're all working from home. We raised $125 million led by Y Combinator again. And it's just been, it was just really, it was really empowering to see that, you know, Y Combinator, which we felt so honored to get into their initial batch in 2016 as a seed company, to see them double down on podium and make it their largest investment at the time is just, it's awesome. And we were, so we feel really grateful for the folks over there.
0 (11m 44s):
Nation. We're going to get some specific direct advice from Eric, for you, entrepreneurs who are listening, who have business ideas that are in the SAS space software as a service and more, when we get back from thanking our sponsors, did you know that 97% of text messages get opened and 90% are opened within three minutes. You need to be texting your customers. If you're spending time on the phone, scheduling appointments are in a tight battle with your competition, or you need to convert more sales from your website. You need podium. Podium is a business messaging tool that brings all your messages into one centralized inbox. Your whole team can access empowering you to save time while responding to your customers. Faster podium is helping all kinds of businesses serve their customers at the highest level, including doctors, mortgage brokers, insurance agents, lawyers, retailers, and more, whatever your business does, podium can help.
0 (12m 33s):
And podium customers have seen fantastic results. One plumbing company converted 60% of their web traffic into leads in a national retailer collected over 18,000 reviews across this locations. And for a limited time, you can sign up for 20% off your plan. They're so confident that if podium doesn't make your business better within 90 days, they will send you a $150 Amazon gift card by your nation. Visit podium.com/fire to get started. That's 20% off. If you visit podium.com/fire businesses have to be flexible this year from working remotely to pivoting their business models for long-term survival and growth. Just look at all the restaurants that have moved their dining outdoors, or added take out to their offerings or the major retailers who are now designing and selling a face masks.
0 (13m 14s):
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0 (14m 3s):
So Eric we're back. And I really want you to take us to the moment. I mean, I feel like you've had a few over the years, but what was the moment you started believing that, Hey, podium is more than just a little business that you might flip someday, to be
1 (14m 17s):
Honest, when you are in the early stages, especially when this is your, when it's your first business, which this pretty much was for me and Dennis, my co-founder, you're pretty terrified from day one, that you're going to screw it up. Like once we knew in the year, like within the first couple months we knew we had something really interesting and really valuable to our customers. And then for a really long time, I think for like three years, you're terrified of screwing it up, but you can't let that fear of screwing things up because you don't know what you're doing. It like, that's just the plain truth is we didn't know what we know. The reason we were able to even get through all those first three years is we just met as many people as we could listen to podcasts like entrepreneurs on fire.
1 (15m 1s):
And actually like, just listen to people that were, that had been successful in things that were really similar to what we were doing, but also like learn from people that had not had a lot of success. And so it went from something that we felt like we should try and get grow as quickly as possible and sell for the first three years. And I think the point in which we realized it was something much bigger than something that you'd flip is I really believe it was meeting some of these really world famous founders, CEOs, like one of the founders of Airbnb and like the founder, former CEO of Groupon, and started meeting all these people.
1 (15m 41s):
And you start to realize that, yeah, there's, they're really smart. And they're really, really lucky too. And we're not that much different than them. As long as we have the market opportunity, we should continue to go after this. So I think the, the, the thing that switched it in my mind, I think my co-founder Dennis, his mind is we realized that we could do this. I think that's the most, it's one of the things that keeps people from building big businesses is like just the belief that you actually can do it.
0 (16m 16s):
I believe fire nation. You've got at your core deep down believe that you are providing a real valuable solution to an actual problem in the marketplace. And speaking of that, Eric, it's one of the most interesting parts of your business. Like you work locally with brick and mortar businesses, which is different than most companies you find on the quote unquote cloud 100. So what specific pain are these businesses feeling that you at podium solve?
1 (16m 42s):
The most important thing is a lot of these businesses that we work with when you look up. So say it's a plumber. If you, if you need a plumber, you look up plumbers near me on Google or Facebook or Yelp or whatever you look them up. A lot of these businesses don't even show up, even though they've been around for 20, 30 years, they're probably the, one of the most trusted businesses in their area. They don't even show up. And so we have this product that we think is really important. It's a reviews product that helps these businesses get reviews on sites, where consumers are looking like Google and Facebook and others, and we help them get discovered. And that's the most important thing. If you don't get discovered, you don't even have the chance of converting a customer. So we do that. And then the other, just, this is the, this is the core problem that we solve is from the time that somebody a consumer says, Hey, you look like somebody, or you look like a business I want to work with, or I might want to work with, we make it so easy for both the consumer and the business to make that connection.
1 (17m 41s):
And whether that's on text message, Facebook messenger, email, Apple, business chat, whatever it is, it doesn't matter. We just make it as easy as possible for both parties to go through the commerce experience, go through the experience of, Hey, I have a few questions. Hey, do you have appointments? Hey, can I schedule, okay, Hey, here's a reminder. We're coming to your house. And, and then here's the way to pay really easily. And we do that in a way that is so much more modern than the current status quo of these businesses, which is really like a landline telephone sending letters in the mail, walking, having to drive down to a business and walk into it, which, you know, in a, in today's COVID environment, that just seems crazy. But even pre COVID, that just doesn't make a lot of sense.
1 (18m 22s):
When you can go on Amazon or a Shopify power business today and click a button and something shows up to your house in 24 hours. So we just are what I feel we're doing across the board with payments and messaging is we're elevating these local businesses and we're modernizing the way they do business to match the expectations that we as consumers have.
0 (18m 41s):
Okay. Let's get specific here. What specific advice would you give to fire nation? Our listeners who have business ideas that are a little less quote, unquote, conventional than your typical enterprise SAS plays, like what would you want fire nation to know as they start their journey in 2021 and beyond?
1 (18m 60s):
Yeah. So I said earlier that we met with a ton, as many people as we could, and we learned as much as we could about the road ahead. The one thing I would say the caveat to that is we were also told by very experienced people that we should change our business model or the SMB wasn't worth trying to sell into. And we were told again and again, that it was possibly a bad idea because it wasn't the conventional enterprise software as a service play or the consumer play or whatever. And it always affected us. Whenever I remember there's a specific experience where we went to this meetup or this, this person was speaking at a, at a little event in Utah, we went and we, we really respected this person.
1 (19m 44s):
They spoke afterwards. We met up with them and they said, Hey, I'm really nervous about your business model to Dennis. And I were, we said, Oh my really? And they said, yeah, like you're selling to the wrong market. It's going to be too hard to penetrate the SMBs. And you may want to either go up market or just change your whole business model altogether. And we re, we went, we, I remember driving home with, with my co-founder Dennis that night and thinking, maybe we should like, maybe this person actually understands this more than we do, but we kept going back. And this is the lesson is we kept going back to this truth that we had, which was our customers were paying for our product. They were getting value. They weren't canceling and more and more were signing up.
1 (20m 26s):
And, and the fundamentals of business were making sense. And so we, I guess the main lesson is don't let a couple of opinions sway you. And, but also backup your own intuition with the data of your business, which is like, if it's, if it's succeeding and the numbers make sense, and your customers like your product, they're not counseling. Then you probably have something good.
0 (20m 49s):
Our nation, there are always going to be doubters. Doubters are going to be everywhere. That's why you have to, again, going back to your core, your gut, your intuition, do you believe that your solving a real problem for a real audience in that the answer is yes. Drive forward with all of your heart and soul. Now, Eric, what do you want fire nation to take away from our entire conversation today? Give us that one takeaway
1 (21m 17s):
Biggest takeaway for myself over the last six years is we started out my co-founder Dennis and I, we started out with no experience, building a software company, very little money. We had no outside capital in the early days, we were selling the product door to door and it was extremely uncomfortable. We didn't know what we were doing. And we figured it out. We pushed forward. And over the past six years, one thing you might think is, Oh, they nailed it early. And they've just scaled that. And that's been the growth of the business. That's not true. We have returned to that uncomfortable state where we decided to do something new and bigger several times, every six months, it feels like we're going into this new unknown in our business and taking a leap of faith and getting back into that uncomfortable stage.
1 (22m 9s):
And every time we've done that, this is based on the research of our customers, our intuition, our instincts of the data. But every time we've done that we've been rewarded again and again. And so my biggest advice, it's great to develop product market fit in the early days. And that is a key to success early on. But once you get there, you can't rest on your laurels. There will always be other people trying to compete with you. And basically if you're not innovating and not taking new leaps of faith, it's not going to, you're not going to be able to scale the business
0 (22m 41s):
Fire nation. As you may have heard during our sponsorship breaks, podium is a presenting sponsor for us. And for a very limited time, you can sign up for 20% off your plan over at podium.com/fire. So if you know somebody who could use this service or you yourself want to try the service podium.com/fire fire nation, you're the average of the five people you spend the most time with. And you've been hanging out with ER and JLD today. So keep up the heat and you head over to eofire.com and type Eric in the search bar. The notes page will pop up with everything that we've been talking about today. Best show notes in the biz links, all of our things that we chatted about.
0 (23m 21s):
And Eric, I want to say thank you for sharing your truth, your knowledge, you are value with fire nation today. For that we salute you and we'll catch you on the flip side. Thanks John. Hey, fire nation today's value bomb concept was brought to you by Eric ans. If you've had your big idea, you would be ready to ignite. And my free training will get you to your big idea in less than an hour fire nation. Visit your big idea.io today, and we'll catch you there, or I'll catch you on the flip
2 (23m 51s):
0 (23m 53s):
You know that 97% of text messages get opened in 90% are opened within three minutes. You need to be texting your customers and podium can help for a limited time sign up for 20% off your plan at podium.com/fire.
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