Lemlist Reject $30M: Inspirational SaaS Funding Advice – Guillaume Moubeche @ Lemlist

Todd Chambers
Todd Chambers here, hello!

Welcome to another episode of the masters of SaaS podcast, brought to you by Upraw Media, an agency that works exclusively with SaaS companies to help them gain traction and scale. On the podcast we speak with top performers from the SaaS community. And today I have an awesome episode for you!

I speak with Guillaume Moubeche, CEO and co-founder of Lemlist, a sales automation platform that allows b2b companies to automate their sales prospecting. In just three years, they've managed to grow from zero to more than 10,000 customers, and 5 million in annual recurring revenue, taking zero funding and never having to spend on paid advertising. Some of the episode highlights include how Lemlist mastered organic growth, why they turned down a $30 million investment which also included $5 million, personally, to each of the co-founders, the pitfalls of focusing too much on funding, advice for aspiring entrepreneurs, and how he got scammed by the Chinese mafia, but managed to get his money! Guillaume is a super impressive entrepreneur, and he really delivers in our conversation. So please enjoy!

Hey Guillaume, welcome to the show.

Guillaume Moubeche
Thanks a lot for having me, Todd.

Todd Chambers
Yeah, the pleasure is all mine. And we're looking forward to this one. You guys have some really interesting stories to tell, so we're interested to dig in. For the people that don't know you, maybe you can give just a basic introduction to yourself. And then your company Lemlist, who you are what you do.

Guillaume Moubeche
Yeah, sure! So my name is Guillaume Moubeche. I'm the CEO and co-founder of Lemlist. Lemlist is sales automation platform that allows b2b companies to automate their sales prospecting on multichannels. So cold email, social selling, and also calls. In the last three years, we grow from zero to 10,000 plus customers with vast majority of our customers based in the US and all bootstrapped - meaning, with zero dollars in funding.

Todd Chambers
Yeah, congratulations on that! One thing I just picked up on as well there; you changed your elevator pitch or your value prop, you changed it to sales automation. That was not previously there! So maybe you can elaborate briefly on on how that's changed.

Guillaume Moubeche
Yeah, definitely! So we started with being basically the most personalised tool regarding cold email, because prior to Lemlist, I actually had my lead generation agency. So I was helping a lot of companies in their sales prospecting. And when using all the tools on the market, I felt like there was not enough personalization. So you couldn't add photos with dynamic like text, tags, logos, or even like videos to make it like more compelling. And since sales is all about relationships, I was like, we need more personalisation.

So we started like this. And eventually, you know, I was doing also a lot of LinkedIn, a lot of calls, etc. And I was like, "okay, let's get there eventually". And as the project grew, we we started shifting a bit. So I think for us, in terms of our strategy, but we might come back to that later, we have a really powerful warmup system. So something that allows you to get best deliverability, meaning that your emails end up in the inbox and not in the spam. So we have like, really good warmup system, then people upgrade to email outreach, where they can send emails, and when they become like, really want to step up their game, when it comes to outreach, they start scaling up to the to the last one, which is multi channel, basically.

Todd Chambers
Yeah, I'm definitely interested to hear about this multichannel. And it's interesting what you said about the personalisation. I've only ever tried cold email. I tried it one time, I did it at roughly 18 months ago, and I use Mailshake. And at the time, like our brand is quite human, quite personable, you know, we're kind of like, no BS, we don't mind swearing and kind of being ourselves. So that's kind of how I lead in my cold email. I tried to use charm and humour, but I wanted to personalise the email. So we wrote on the board, I think I've seen it in some of your templates as well. We've got like, "how we can potentially help". And then you've got like bullets 1,2,3 to kind of grab people's attention. But I was actually writing the name manually on the board, taking pictures, and then we had to like map it to Mailshake. It was just really time-consuming.

Guillaume Moubeche
You should have talked to Lemlist!

Todd Chambers
Exactly! So, you basically help people personalise at scale, which you've learned basically gets much better response rates, right?

So you have two other co-founders. And it seems like, from my research as well - by the way, I'm really impressed - it seems like you've done everything kind of the right way. It seems like you've built it from basically fulfilling a need and building a great product, getting people into the product as early as you can, getting feedback, building a community and building content. I also noticed you're maybe a bit of the face of the brand as well. But to me, it seems like you've just done everything the right way. And you've just grown it organically, never taking funding. Would that be a fair assessment?

Guillaume Moubeche
Yeah. And on top of it, I would say we never really like... I know you're a PPC expert, so, sorry! We never actually paid any ads. So...

Todd Chambers
Good for you!

Guillaume Moubeche
Actually, eventually that's a channel we might end up using, and we might get in touch. But for now, it's been mainly, like, us using Lemlist to do our sales prospecting and getting clients, or just doing organic with the growth of our community. We built the biggest community around sales automation, then also producing a lot of content - showing, you know, how to use the tool at the same time, as, you know, solving a problem. So, "how can you make your templates super personalised?" And then, you know, we include the tools in the content so people understand like, how to use it, and all these types of things has really generated, like, a very nice circle of growth and flywheel of growth.

Todd Chambers
Yeah, good for you! So I'm just gonna go to my sheet and just look at some numbers, just to give people some context.

So this was actually from a pitch that you put on YouTube, you actually pitched to investors and you recorded it, you should definitely check that in YouTube. It is in French, the actual video, but you put subtitles on that, so I took it from there. So 2020, last year, at the end of Q1, you're at $1.2 million ARR, the end of Q2, you are $1.9 million, Q3 $2.9 million, and, by the end of 2020, $4.4 million ARR. So that's quite some impressive growth, considering you don't do paid, you've never taken funding... So I think that definitely sets the stage.

So let's talk about this really interesting project that you've had with regards to funding. And this is the main thing I want to discuss with you. So you actually went about getting 20 million in funding, maybe you can tell the whole story of why you did this thing and kind of how it's all turned out?

Guillaume Moubeche
Yeah, definitely. So actually, like, I can give you the secret of how everything started, or at least like where the idea came to my mind.

So, I was chatting with Nathan Latka. It was during a live and and eventually, you know, he was saying, like, "you guys have a bootstrap company, you're growing super fast, your numbers are sexy', like, 'there is no need, you know, for you to raise funds'. And then I told him, like, 'the only reason I would like to raise fund is to get an article in TechCrunch'. You know, like, for the fame, but I was saying, you know, like kidding, and then he told me "yeah, I mean, you know, you just have to pay a VC 5000 bucks, ask him to send a term sheet, and then you get in touch with a reporter and say, "I have a term sheet from this VC who will probably say no, do you want to write an article about it". Then it made me laugh. And then I started thinking about it.

And I'm like, I mean, when you look at fundraising, overall, it's very opaque. Like, you don't have any information, you don't know how it goes. And since I started, you know, documenting a lot on my YouTube channel, and I was posting like tons of tips and tricks on you know, how to be more productive, how to network, how to do like, all these things that an entrepreneur should know how to do. I was like, okay, I've been interviewing, like, top founders about fundraising, also top VCs. And then I was like, "let's challenge ourselves to raise $20 million in two weeks. And, on top of it, I was like, we know that we're going to say no, and the reason we will say no is to show the word that you don't need to actually raise money to be a successful company, and you don't need to raise money to be in hyper growth.

Because what I'm kind of sick of in the media is just, you know, like all the same articles about who has the biggest fundraising or like run the fundings and and it's all about these numbers, but, you know, in the end, they never talk about the real statistic - which is that 9 out of 10 companies which raise funds actually fail. So, you know, eventually I wanted to go and start a debate about that, start talking about profitability, on employee happiness and all these type of things, which for me, matter, like, ten times more than the rest.

So we started this and we recorded an entire pitch, so it was quite stressful. It was a lot of questions...

Todd Chambers
Yeah, you seemed stressed.

Guillaume Moubeche
Yeah, you know, it's like, I had my end goal in mind. The end goal was receiving a term sheet so we can say "no", and, you know, once your pitch, obviously it will basically decide for you, you know, if you're going to get that term sheet or not. But once we received the $20 million term sheet, I was really amazed, because I announced on Twitter that I was raising like $20 million in public, and then I posted on LinkedIn and then things got really crazy. Like, tons of investors reached out, I had LinkedIn messages, Messenger on Facebook, Whatsapp, text messages... I was like, what the fuck?

And then, like, once we announced like this offer it was crazy, because people starting like getting to me straight away, and I we knew that we wouldn't take the offer. So I didn't want, you know, to waste time from investors. So I was sending them canned replies, very polite, saying "I really value your time right now is not the perfect timing for us. But I'll reach out whenever I think the time is right and see if it's a good fit". And then some of them were really aggressive, like , "yeah, but you know, like, how would you know it's a good fit or not if we don't meet? Let's meet next week"! And then they were like giving me, like, Friday 10am, or 2pm, or anytime you want, and I'm free in the evening also, and I was like, oh my God, this is getting really crazy!

Actually, this is when I discovered a new type of fundings. So, essentially, VCs, so venture capitals, the goal is for them is to invest in the company. So the entire money they give is usually almost 100% in the company. And if you start doing cash out, meaning taking money for yourself, it's usually a red flag for them. So in the U.S., for example, they will say like on the first round, if the founder is taking more than $200,000, it would be a red flag for that, because they want you to have skin in the game, which can make sense. But also, you know, it's very VC minded because it's like, "yeah, we were investing in pretty much every company, but we want you to just be like, super focused on yours". Well, actually, we're making tons of investment, we can put that in perspective also. And eventually, the offer we got was actually from a private equity fund. For me, from my understanding before this fundraising, publicly private equity was really like, at a higher level, you know, they start putting tickets at like, 100 or $200 million, and not like that small, but they offered us like $30 million. And what was crazy with that offer is that it was $15 million for the company, and $15 million for us. So it's just the three co founders in the company. So the 5 million each. Yeah, 5 million each. And when you see that, you're like, Oh, fuck! I had my message. I had my mission, I had everything, but you're "hey, here's $5 million in my pocket".

Like, to be honest, where I come from, like, my parents didn't do any... Like, they didn't study, they grew up in a farm. And you know, it's $5 million. It's like life-changing. So, the first time we received the offer, I was like, at first, I didn't sleep. And I was like, "okay, fuck", and then I was like "okay, we need to chat with my co-founders, but also the team".

After I slept on it, I was like, for me, my mission, I think is more important, because I help a lot of entrepreneurs, and I'm really sick of having them coming to me, you know, and... They haven't launched their product, they haven't talked to their customer, but they're like, "hey Guillaume, I spent like three weeks working on my business plan, can you have a look at it", or "I've been reaching investors for months, every time I send them this Excel spreadsheet with my business plan and how I want to grow, they always have the same answer, that I need to wait, etc. Like, can you help me out? Or can you put me in touch with investors"? Like, fuck, you're wasting such an amount of time on fundraising, when you should actually, like, go out there, meet your clients, bring value, find a real solution to a problem, talk to them, really be, you know, in the trenches?

And then I was like, okay, I think it's a good time for us to just explain everything, explain why we did it. And at the same time, say, you know, like, we're not against fundraising, because for some companies, it makes sense to fundraise. And it can be, but we just didn't want it, and we were a bit sick to have all of these people telling us that when you bootstrap it's like, "mom-and-pop" business. You know, it's like, small businesses and then the big boys.

Todd Chambers
Yeah, "come join the big boys and have funding". It's like, yeah.

Guillaume Moubeche
Exactly, exactly. It's like bootstrap is baby league, it's like, you know, you're not there yet. And, for me, it's crazy. Because even in France, we have all these awards and everything that are actually given based on the fundraising and not on your profits, not on your revenue. Like "you need to raise at least x million dollars". And I'm like...

Todd Chambers
Can I ask you a question? I mean, i'd love to dig into that as well, and some of the problems with funding, the pros and cons of each... But when you approached this funding exercise, did you actually know from the outset that you were going to say no, and were you going to use it a PR piece?

Guillaume Moubeche
Was that the plan? Yeah, that was the goal. Because for me, it was, you know, like, it simple. I thought about it, because I write a lot. I write a lot about our story, I write about, like, our mistakes and failures, and also the things that we do right. But you know, if I had written an article saying, like, "why you shouldn't fundraise", or "why fundraising is not equal to success". Yeah, it would have been on our blog, people following me would have liked it. But it doesn't make an impact. It doesn't change pretty much anything. And I was like, "okay, if you want to get noticed, you need to do things differently. You need to do things that you shouldn't do in the first place, like, according to everyone else". And in the end, that's what entrepreneurs do. You know, like, they do things differently. And for me, it was great to show that you can be different, you can inspire more people, and we can start to debate.

Todd Chambers
Yeah. 100%. And I mean, like, you're kind of leading by example. It's like you said, you could write a blog about it, you can give your opinion, but you were just offered $5 million each plus $15 million into the company for 20%, wasn't it?

Guillaume Moubeche
No, it was a bit more, they were taking 30%.

Todd Chambers
Okay, yeah, but then you didn't accept the offer!

Guillaume Moubeche
Yes, yeah.

Todd Chambers
But at the end of the day realistically, for you guys, I mean, you don't have to share the profitability, but I think you guys are, I heard, you know, in the hundreds of thousands of net profit per month, so it's not like you necessarily need the money to accelerate growth.

Guillaume Moubeche
Yeah, absolutely. So our gross margin now, I think, in dollars, is above $200,000 per month. And our goal is actually to give a big chunk of the gross margin to our employees. So the idea is, by the end of the year, every single person working at Lemlist will end up with at the top of their salary, with a bonus between like 15 to 25k.

And for me, it's important you know, it's entrepreneurship. It's like, it's an adventure building a start-up, it's an adventure. It's super important for me to give back, and I know this ammount can be life changing also, because it allows you to, you know, start an investment for a flat, buy a car or do big things. And you know, when you have VCs at your board, the things they will tell you is like, yeah, like, it's not shares, but similar like, to shares, to your employees. And basically, that's it, you know, and you can't have dividends at the end of the year, and they really want everything to be invested in the business growth, which sometimes don't make sense. Because if you have enough money to have the peace of mind, you know, "I've got my flat, I can pay for the rent, I know that I've got some savings, and I can like sleep comfortably", etc, then, you know, all the decision you make are ten times more impactful. And it's not, you know, laziness or whatever to you know...

Like, if you start being an entrepreneur for money, stop. I mean, you're like, I don't know, go to finance or do something else. But for me it's definitely not about that, you know, like, I started to help people. And I haven't changed, you know, like, same $5 shirt, I don't care about like fancy stuff. So, yeah.

Todd Chambers
So Storm Ventures were the venture capital firm that you have posted on YouTube. By the way, sorry, I've forgotten that woman's name, the one you spoke to.

Guillaume Moubeche
Yes, Pascale.

Todd Chambers
She seemed great, by the way!

Guillaume Moubeche
Yeah, she's super nice.

Todd Chambers
Extremely incredible, very, very switched on. So kudos to her for letting you post on YouTube. My question was around, kind of, how do you feel that could potentially kind of negatively impact that relationship? Because I mean, you know, you've kind of wasted her time. And how is that conversation with her?

Guillaume Moubeche
That's a really interesting question. Like, I have this question quite a lot. And quite often, so it's, it's funny, but actually, we're really like, in good terms.

Pascale's vision of entrepreneurship is much more, like, we're super aligned. So it's like helping more and more entrepreneurs to raise in good conditions to do all these things. And you know, like, actually, after we published the video, she had, like, tons of really, really amazing feedback from other VC friends, other people that were like, yeah, it's for them, it's like, it will become the same as the AirBnB Pitch Deck that everyone shared. It's like, you have all the questions that are going to be asked, you know, when you have a SaaS company, during your pitch, and what are the metrics you should know, how investors work, what are the things they're looking for, etc. And for her, it was actually like... She was really thanking me, you know, for the visibility and everything.

And I also told her like, a bit in advance, like, "okay, Pascale, like, our goal is not to raise funds, we will say, no", etc. She convinced, tried to convince us; "we will send something you will see", etc. And I tell told her, like, "we do everything publicly". So you know, I didn't want to put her in a bad spot. And so that's also why, you know, I didn't also mentioned the exact name of the private equity fund, because since I never met them, I didn't want to showcase their name, etc. With Pascale, I knew for her, you know, I think she has a bit more the American mindset, it's like, you win some, you lose some. And in the end, you know, it's it's never an issue, you know, as long as you're transparent, and you've done the right thing, you know, it's okay.

And to be entirely honest, once we received the the offer, with $15 million in cash out, I think I spent two hours on the phone with her to ask for advice, because I was like, "this is huge". And then she was very thoughtful, asking me about my mission. She told me like, "okay, at the end of the year, you cross the $10 million ARR". And she told me, like, "you don't need to hire a massive team to grow at the same speed, you have a very scalable business". She was like, "okay, let me take off my investor hat and tell you "okay, don't take it, keep growing, focus on your mission, you've been doing that for three years". And she was like, super thankful, and super, super kind.

Todd Chambers
She seemed great! And your presentation as well was super impressive. I mean, I listened to it in French, so I listened to the subtitles, but I felt like it's not just an example of the types of questions that you need to be prepared for, I would also say it's a very good example of how to answer them. You were very clear and concise, to the point, you like answered your question, like pretty much perfectly in my opinion, every time you had all the numbers there in tableau, I think like all ready... So yeah, it was super impressive.

So one thing I heard you say in another podcast, I think it was on the Nathan Latka Show you mentioned, and I think this was not so long ago. I think it was in maybe Q3 of last year. And he was asking you if you'd sell the company? And you said no, you said I wouldn't sell the company. And he asked you the question, "what would you value the company"? And you said, at the time, I think you were at $2 million ARR? And you said, "well, if I'm being fair, it's like roughly five times", I think you came up with a number of like, 8, 7-8 million, is what you said, and this is like, not long time ago. And you now got a term sheet for like $100 million valuation. So how do you reconcile that like... Wow!

Guillaume Moubeche
Yeah, actually, it's a super point that you're mentioning, because I think, like, what's really important for companies to understand, and also how valuation works, because on the side of Lemlist, we also built another tool like Lempod, that, after 18 months, we actually exited and the company got acquired. So I really got into, you know, like, how businesses are valued when they're actually acquired versus when they raise funds, and the difference is basically huge.

Because once, essentially, a VC gives you a valuation of your company, they value the company in the future. So, for example, when you get like 30 million investment at, I don't know, $100 million valuation, it doesn't mean that your company is valued at $100 million, it means that after you take the money, and after you spend that money and grow, etc. we think that your company will be valued at potentially, like 100 million or more. And that's, that's basically the entire game with VC. Whereas when you try to sell your company, and usually you sell it to either entrepreneurs, or like, private equity firms, or sometimes like, yeah. Is it like other companies? It's very, like, straightforward, and much more financial. So, it's like, what type of assets do you have? They try to never value brands, because for them, you know, it's difficult, so they like to stick to numbers. And then, after that, you know, it's like... In the end, again, the value of a company is the price that someone is willing to pay. But until you know, I think you should always keep in mind that for SaaS, depending on where you stand in ARR, but it's always a multiple of the ARR.

Todd Chambers
Understood. Okay, well, maybe we can talk about some of those things you were mentioning, in terms of what you see is the problems with funding.

So, speaking from my own personal experience, right, we work specifically with SaaS companies, and many of those SaaS companies come to us because they want to scale up using paid media. You guys have had the luxury where you haven't had to do paid media, which is actually quite a rare case. And in a lot of examples I've seen, I've seen this multiple times, they'll say, "okay, we're at series A, we want to get to Series B, we're trying to get the next funding round, it's coming", you know, you have to prepare six months in advance. And for this, we need to show growth, we need to hit these targets, we have the investors leaning in our shoulders to hit these targets so we can get to the next train. And they'll literally have come to us and said like, "hey, we just need to like really throw some fuel on the fire. And don't worry so much about profitability. We're happy to even maybe lose money, as long as we can show the growth". And it's like, it's this game, right, that people play. It's just about getting to the next round inflating numbers using revenue.

So, like, what are your thoughts on what's broken with funding and SaaS companies?

Guillaume Moubeche
I think you you showed the first issue, you know, it's people don't talk about profitability. And the issue is that if you're not profitable, for example, on your ads, how are you thinking that when you scale, it will become profitable, you know, like, it doesn't really make sense, because you have lots of, you know, like barriers and, and audience saturation, and so many more things on top of it.

I think the more money you have, the more decisions you have to make, you know. It's like, when you don't have money, you need to focus on the channels that don't require you to spend money. And those channels are essentially you talking to customers that cost your time, but it doesn't cost money, you reaching out to people like it's very, like cheap, or to do this on LinkedIn. It's basically only time, and I feel like, again, for me, raising money is a huge defocus from the founders. You mentioned it and it's 100% true, you have to spend like four to six months, and this is when things go quite fast. You know, I'm talking like, series A, when the company is not with sexy numbers, when you have, like, really sexy numbers, it can be like much faster. And I think we were lucky with that. But if you don't, it will take a lot of time, it's a lot of hassle. And you lose, you know, the key objective or company, which is really providing value to your customers.

I think the best money you can get, and the best fundraising, is actually from your customers. So having customers paying monthly is the best fundraise you can do, because, you know, if you're providing value, you know, you're on the right track. And basically, then everything can be about recommendation, word of mouth, and growing like this. Growing organically doesn't mean growing slowly. And I think like lots of people think that organic is slow. But that's not the case, you know.

Todd Chambers
No. The other thing is you said, you said something before as well... And this is my two cents on it as well, when you don't have funding. You mentioned skin in the game. Like, when you do things and it's all your money, it's you and two co-founders, like you said, you have to hustle super hard, you have skin in the game. So, if you have, like, you've made some money, you have to be extremely careful about where you reinvest that money. Whereas if you've got tons of money in the bank, and it isn't even your money - I've never had that luxury - but I can imagine that you would just be a lot more, kind of, shoot from the hip. You know, like a little bit more in the wild west of making decisions. Whereas if you don't have resources, you're basically forced to be super resourceful. I think that's a strength.

Guillaume Moubeche
Yeah, absolutely. And I think it's I think it's the essence, you know, of entrepreneurship. You start with very few things and then trying to make great things. All entrepreneurs should do that and should work on that. I think like, you know, in some cases, fundings is necessary. If you think about companies like Clubhouse - without funding, they wouldn't exist. If you think about, like, MedTech or BioTech, they need huge investment in R&D from the start. They need that money. But, for example, for SaaS company, we're in digital, like, you can reach out to people. You can, build like landing pages for nothing, get your first customers without having a product... Like, it's doable.

And I see too many people, you know, just because they have a track record, just say "yeah, you know, I'm gonna raise like $1 million, have a team and start doing things" and... From what I see from the outside, it's like, the founders who have raised money when they start, essentially, they have to focus on the next round, and when they are focused on this, they often lose sight of what really matters for their customers. They don't spend enough time with them. And they have to rely on their team, which is great, because, you know, you need to rely on your team. But I don't think it's how you build a sustainable business. Because for me, what was like really helpful is that, for almost two years, I did everything, like, support, marketing, sales... So when I hire someone, they're not gonna fuck with me, you know? Like, I know what you have to do. I know how to write like good articles, I know how to close deals, I know how to do sales, prospecting, I can reach out to X people and get X meeting, like, I know how things work. So if you know the ins-and-outs of your business, then, you know, it's much smoother, and then you can train your team, then, you can help them grow. And then, you can really share the vision and have people do the thing.

Todd Chambers
Yeah, I think Jason Fried from Basecamp, he also talks about the same thing, like, do the job yourself first, and then you can hire someone to do it because you know exactly how.

What strikes me as well is, I mean, let's be real - you're an outlier. So you've done things incredibly well. And you've had a really, really great success. You're definitely an outlier. So entrepreneurship kind of gets put on a pedestal a little bit, I think, you know, these younger guys that kind of want to be an entrepreneur... Where did that come from? For you? You mentioned that your parents, you said, had to farm? Like, I just wondered where you picked up, you seem to have this entrepreneurial ability, like where do you think that came from?

Guillaume Moubeche
Well, that's actually a really, really good question! I don't know where it came from. But I always loved, you know, like, when I was really a kid, to trade things and try to like, bring more value in the things I was trading. So start with, like, magic cards, and then eventually get a Gameboy or something like that.

And yeah, but for my parents, actually, business has never been a job. Or going to business school, it didn't make sense for them. It's like, no, like, study science. You know, like, for them, it was old school mindset, you know? They didn't go to uni or whatever. So it's like, "if you study science, you'll get technical knowledge, and you can do whatever you want". So I had to do like, actually, I'm a chemical engineer, I even did advanced medicinal chemistry in Glasgow. So I spent a bit of time in Scotland, drinking a lot of beer!

And eventually, like, after that, I had like, my Master's and everything. And I told my parents, "okay, like, I want to go to business school. Now that I have my engineering background, don't worry!" So business school in France are extremely expensive. Like, I think it's the same all over the world.

So I went to HTC, which is, like, the best business school in France. And when I was there, because it was really expensive, I also wanted, you know, to start, like building a business on the side. So I started the business with my dad. For him at that time, you know, I became like, the I was a businessman, you know, because I was in the best business school in France. So it was like, "my son is going to help me get a lot of money, build like a profitable company", because he is a designer. And we started working together. And I was like, really, really naive when I started. So I was putting a lot of pressure on him. So we had like, a lot of stock because I was like, "once we go live and start selling t-shirts, the website, we need to be sure that it holds the loads, because they're going to have massive, people trying to buy everything", etc. So I was building a community around Paris, so we can use this community to like, start, you know, like selling t-shirts and everything. Once we launched the website, we had like, zero orders. And I was like, "holy fuck", you know, I felt so bad. And the more we were growing, and we started adding a bit of sales, but very few, like 5 to 10, etc. And I was putting like, a lot of pressure on my dad, like, I kind of ruined the relationship we had, because we used to exchange a lot of ideas, but I was kind of making him pay for my mistakes. And I felt really, really bad.

Then one guy from my high school actually was starting his own company, which was a lead generation agency, and he was alone. And he was telling me - I didn't know anything about b2b - but he told me like, "let's start this together". Like, "you're a grinder", like "I know a lot about b2b, let's grow together". And we started this together. And since then I really made a promise to myself, you know, to never really let down the people who I care about. And since then, I think it was kind of my drive to really like, work on customer acquisition, understand the ins and outs of marketing, sales, growth, growth, hacking, and all these type of things. And later on, we started building Lemlists, but it it was, I think it kind of started there.

Todd Chambers
A few things to unpack there. But maybe one question is what like, I was asking where your entrepreneurship came from, and putting entrepreneurship on a pedestal to all these maybe younger guys that finished their masters, you know, like you, and they wanted to start a business.

So basically, your message is; you don't necessarily have to go and get funding, there are options to build communities, to build MVPs to fulfil a real need... But like, that aside, would you agree that entrepreneurship also takes a certain type of person? Entrepreneurship is definitely not for everybody, it can be super lonely, you know, building a business, I mean, especially if you're on your own. So what do you think are those, like 1, 2, 3 traits that you need to have to going in, like, before you start a business?

Guillaume Moubeche
I think determination is the number one. If you don't have like, the ambition, and the grit and the grind that you are going to put in the business, then, you know, don't do it. Because, as you said, entrepreneurship, in the end, you know, especially if you're like, the CEO, and you're handling the most important decisions - you're going to be lonely. When you win, you always win as a team, but when you lose, you lose on your own. And even me, you know, I have like two co-founders. But I know that during our losses, because we had, like, some losses, and we did like some shit, you know, in the early days, you know, it was on me, you know, it's, it's on my shoulders. And so you need to be prepared for that.

I think Carol Dweck, she was like, a professor at Stanford, and she talks about like, fixed mindset and growth mindset. So fixed mindset, you know, are people who would think, for example, that you have brains that are good in math, and that are logical, and you have other brains that are artistic or whatever... It's not true! Like, we know that is not true. But a lot of people have this mindset, it can be based, you know, on your parents, or your education, or the society, which tends to force to say you have good students, bad student, etc. But actually, when you learn about how the brain works, we have actually all the ability to become growth mindset, meaning that you understand that sometime, when you face a problem, the more you work on it, the more your brain will create new connections, and the easier it will get. So for me, if you start off with a growth mindset, it's much easier to start a business. I think it was Einstein, you know, who said, "I'm not smarter than other people, I just spend like, a much longer amount of time on problems to solve them". And and I think this is true. If you can spend time, you know, on issues and you just go for it, have the grind, then everything becomes much easier. 100%.

Todd Chambers
I always think the best place to start is, like, "I'm probably wrong about everything". It's just like, "how wrong am I"? To have that mindset going in. Like, "I'm going to be wrong? Yeah, I'm gonna try, I'm gonna try some shit. I'm gonna get punched in the face. I'm just gonna keep learning". And I totally agree.

I think the number one thing I mean, for me, personally, is just that you have to be able to, especially in the beginning... Because you have like, in the beginning, in the first year, or the first six months, it's like, you're in the honeymoon period, right? It's new, it's fresh, you're going to take over the world. And then, like, for most people, what happens is you get like a year in and you're like 20% of your way through your target. And you're like, "holy shit. Actually, this is gonna be like a seven year thing not a two year thing"! So totally agree, determination is the way to go.

You also touch there on burning, not burning your relationship with your father, but what what was that like? Yeah, like, falling out with your dad and like, you've taken those lessons on now. And it seems like you want to have a bit more of a kinder type of approach to business. Has that lesson really stuck with you? And how have you carried that forward into what you do every day?

Guillaume Moubeche
Yeah, definitely. So, I grew up in an environment where... I did like a lot of basketball in competition etc. Like in, I would say, the dodgiest neighbourhood in Paris. I grew up there, you know, with people like motivating me by telling me that I was like a little shit, that I was doing like fucking shit... So with a lot of insults, nothing really like talking about your feelings and all these type of things. So it was basically tough love, but I grew up with this. And I took my motivation from there, you know. And I guess in the first business I did with my dad, it was super tough to talk about the things that were stressful, and I was putting a lot of things on him and eventually, you know, like, our relationship started, like being, you know, not as good as it used to be. And then we kind of stopped talking. And eventually, like, right now, we are like good pals again. So that's nice.

Todd Chambers
That's nice!

Guillaume Moubeche
But in my business with Jean and François, we're like the devs. We also have like, very different mindsets, different backgrounds. And at first, you know, we were clashing a lot. They didn't want to say things. I was more into, like, "what's the fucking problem", you know, and like, "let's talk about it. Let's fucking solve this". But they were not like this.

And I think what was super helpful was to start something called nonviolent communication. So start talking about your emotions, about how you feel when someone is doing something. Super concrete example for them; at some point, they stopped answering my messages, because we were remote and they stopped answering my messages. And I thought - this was like a year and a half after starting Lemlist - I thought, like, "okay, we have no more company", I thought it was over, because they were not answering, they were pissed. And I was like, "what the fuck", you know? And then they were telling me "yeah, like, you're putting too much pressure, we stopped working, etc." And I was like, "oh, my God"... Actually, they didn't stop working at that time. But they were like, telling me this just to piss me off. So I was like, "okay, okay".

And one week later, when we actually started talking again, you know, it was really tough. And we started talking about really deep things which are linked to our feeling. I was telling them, you know, like, "I'm the face of the business, I talk everyday to customers. So, you know, when people keep asking me, when will this change, etc., and I asked you this question, and I don't have an answer? For me, I feel like you don't care about the business. And then on their end, it was like, "yeah, but you when you ask us, like 10 times the same question, it feels like you're putting too much pressure on us, that's complicated". Sometimes it's impossible to give like clear deadlines, etc.

And then, in the end, we just realise that it's not a matter of having clear deadlines, if you tell me between like three days to a week, at least I can say something. And for them, it's much less pressure because and then I tell them, like, even if you think it's a week, I can send 10 days. it's just a matter of communication, you know, and then we started solving each problem step by step by talking about our feelings about like, how people react and, and all these type of things. And this was really, really helpful. And I also use it actually, you know, like managing the team when you need to give feedback. Because sometimes, you know, like, you're doing tons of things you ask people like "write an article", and you have like, a clear deadline, etc. And they miss the deadline. So you're like, "you put me in a bad spot, because etc, etc." And instead of just saying, "Why the fuck haven't you met the deadline? You shouldn't be doing that, do you want to get fired"? Don't say these type of things and rely a bit more on the positive feedback and communication.

Todd Chambers
Yeah, nonviolent communication is an interesting one. I think I heard Tim Ferriss talking about this. And he had like, a particular phrase for it. It was, like, if you have conflict with someone, it's kind of like when you say this, "it makes me feel like this".

Guillaume Moubeche
Exactly.

Todd Chambers
So you're of saying, like, you're kind of putting the blame on you. Like, "it makes me feel like this". And then they can see it from your point of view. It sounds like you guys have navigated that quite well.

Guillaume Moubeche
Yeah. And I think it's really, really nice, as you said, because whenever you're doing this with this phrasing, you're actually having the person feel the empathy. People have empathy and they would understand your feelings, and it will not be an attack or a direct attack to them.

Todd Chambers
Yeah, for sure. Just to take a right turn for a second... You got scammed by the Chinese mafia?! I really, really want to know what the hell happened here! But there's a twist to this story as well. So do you want to... Tell the story?

Guillaume Moubeche
Yeah, definitely! Wow! Damn, I was not expecting that.

So essentially, like, between my engineering degree my business degree, I spent a year travelling. And because I didn't have any money, I travelled the world for a year using only social network to stay at locals for free. We used Facebook, couchsurfing and even Tinder sometimes... And it was like, it was a really exciting experience.

Once we arrived in China, I was with my best friend, we were in Shanghai and then at some point, there are like three girls coming in and saying like, "hey, guys, can you take photos of us? And can we take photos together"? You know, when you're European, they love to take photos of you, like, in the metro. Everyone takes photos. So I was like "okay!" You feel like a star!

Finally a country where somebody wants to take a picture!

Exactly! and then, you know, like, we took pictures and then they were like, "hey, we're going to go to that show, which is like, kung fu. And then I'm like, my friend loves kung fu and martial arts. He's been doing martial arts since he was five. So it's like, "hell yeah, let's go, let's fucking go!", you know, and they start walking. And we do a lot of circles and finally we arrive to a tiny place. And I'm like, "okay, this looks a bit weird".

We enter the room, and then we enter another room and it's very small and tiny. And my friend is like, "how the hell are they gonna make kung fu"? You know, in such a little room, and then we start asking the girls. You know, and they're like, "no, no, it's not kung fu, it's..." and you're like, "fuck", you know, like, a Chinese word you don't understand. And you're like, "okay, I mean, you know you're not fluent in Chinese, it makes sense".

And then we start seeing the menu and the price are reasonable. So the price on the menu is basically like price per tea pots. And we're like, I think in total, we're like five or six. And we're like, "okay, fine. It's it looks like expensive tea. But let's let's do a degustation. It's like five different teapots. And in total, it would be maybe like 5 to 10 euros per person". So we have everything, and then it gets like super warm, and I don't know, I have a weird feeling like, I don't know. And eventually, like, when they bring back the menu to add more expensive stuff, we see the price - and the price has totally changed! It's not price per teapot. First, they've doubled the price. And then, it's like, price per person per teapot. So they double everything. And then the girls who are there are telling us "no, no, it was the right price. Like we had the same menu from the start". So you're like, "shit did i did i miss something"? Yeah, you know you blame yourself and you're like, "fuck", you know, and we didn't have money. So yeah, in total, it was almost 100 bucks! And I was like, "holy shit"!

And my friend didn't have money, because he didn't bring a lot. So I was like, "okay, let's see". And in the end we spent like, 80 bucks. And I'm like, "okay, let's walk away from there". And then the girls are like, "yeah, like we're gonna go to another place or whatever". And then, you know, like, my friend opens a tourist guidebook and then he sees: "three Chinese girls come to see you and ask to take a photo, then they ask you to walk to see a kung fu show? Don't go. It's a scam". And then I was like, "are you fucking serious"?

And then I was like, "oh my God". So there, they explain you know, in the guide, that they usually go in rounds, just so you're totally lost and you can't find the place. So we went back to the main square where we met them and they were still there. So we went and confronted them, asking them, like, "what the fuck, you stole our money". And then they were like, "we don't speak English, we don't understand"! Pretending that they don't know us... So we came back home.

Anyways, during the night, I couldn't sleep! You know, when we talk about determination. This is like, in my like, I fucking hate being scammed, I was like, "I'm gonna take my revenge. So I woke up at 2am I was going on the internet, like, "what can we find".

The day after that, we go back we find the place and we saw the girls in the same place. So we decided to go to see the police. One guy like, decided to come with us. And from what I read, it was basically possible when the police was there to get your money back, or at least a bit of your money. So when we entered - because I knew the guy was going to try to negotiate and everything - I used everything that you know, Chinese people are afraid of, which is like, losing the face, talking about their country, etc. So as like, you know, "I came to China with the impression that it was a country with respectful people and people that were kind, and here, I'm getting scammed on my fifth day, do you think it's normal? It's not about the money, it's about respect"... The cop was fucking mad! And then, in the end, the guy was like, okay, like, can they share the invoice, you know, with everything, and I'm like, "we got scammed. Do you really think that we had an invoice"?

Actually, we had one, but I didn't want to show it... So the guy was like, "okay, how much was it in total"? And then I said, "yeah, we paid like 200 bucks". And then he's like, "okay, so, if I give you like, 160, would that be okay"? And then I was like, "yeah, it's okay". So we took 160 and then my friend was like, "did we just make 80 bucks"? and I was like, "yeah"! And then we went to a restaurant, and had a massive like, feast! It was a good time. And it's a good way, you know, to start a trip that's gonna last for a year - Don't be scammed. Or know that if you get scammed, you know, they're not gonna fuck with you for a long time!

Todd Chambers
And that's a perfect example of like, the inherent determination in you, that you woke at 2 in the morning. You're like, "Chinese mafia scam?

How about going back to Lemlist just to close up? So we spoke at the very beginning about, you know, moving towards sales automation and also multichannel. Do you want to speak about that, and like, future plans for Lemlist?

Guillaume Moubeche
Yeah, definitely. So our mission, you know, in the years to come, is to help 1 million entrepreneurs launch profitable businesses. And from my experience in these three years, you know, like, in the space is that sales prospecting always works. But what doesn't work is when people have the wrong expectations, or at least when they think that you can automate everything, it's going to be autopilot and you can be just be like, chilling, and getting things on autopilot. You need really to spend a bit of time and learn how to do it.

So, since I always love to teach new things, and I try to be very clear in the way I explain things, I launched the course last year in France, and it's working really, really well and sometimes I do one hour into schools, digital marketing, and so on, to explain. I realised when you teach people and they see the benefits, then, you know, everything's become much smoother. So we decided to launch a few courses in the coming months, we also want to launch like, a bit more things. One of the keys, you know, to our growth, was really about all the things that we've learned, whether it's a tool we use, or the guides we read, or pretty much all the inspirational stories. So my team and I put a few people from my team based on all the steps that I've put in motion during the years. I've asked them to really do for six months, going into all the communities doing curation of the best tool, the best guides that you can filter based on the AARRR funnel. And basically we're going to launch a free site marketing project, where people probably will leave us their email to get access to these types of resources, where they can really learn, one place, you know, where they have all the resources that gets updated on a regular basis...

So we have a lot of new challenges, and we really want to grow the community, help more people, like, be successful in their businesses. And yes, build the right content for it.

Todd Chambers
Yeah, you guys have done incredibly well! I mean, is there any closing thoughts you want to pass on to any young entrepreneurs that are thinking about starting their own SaaS company, or that maybe are debating whether they should have funding or not?

Guillaume Moubeche
First, if you're debating whether or not you should raise funds, I think like, a good things to understand is that getting someone in your company is like a marriage. So having a VC is like having a new co-founder - you need to know about this.

And if you decide to raise funds, which in some cases can really work well, make sure that you really do your due diligence on the investors. Ask them to make an intro to a CEO of their portfolio where things are going extremely well, and ask them also to make you an intro to a company or a CEO in their portfolio where things are going like terribly bad. Like, for example, the company failed, the company shut down, or these type of things, but get in touch with the people when it didn't work. So you understand the best case scenario. And the worst case scenario, once you have the full picture, it's much easier to decide.

And if you're just an aspiring entrepreneur, you're wondering what to do or what not to do just go to Nike and read their tagline, which is "just do it". I think, to be honest, it's difficult to do something better than that. Just fucking do it! Yeah, seriously, because in the end, it's all about execution. It's about grind. It's about like you showing up every day, taking that call, sending that email, writing that article, writing that post and trying to be consistent about it. Because in the long term, consistency beats everything.

Todd Chambers
100%. Just to add on that as well, what you said about "just do it". Have you read "Shoe Dog"?

Guillaume Moubeche
It's on my to-read list! I've started and then like I went to another book...

Todd Chambers
It's so, so good! It's amazing. I mean, like, again, just to echo the sentiment of our whole conversation, if anyone's thinking about starting a business, read that book, because that that book just shows you the years, the decades, of just pure grind. Definitely a book I would recommend.

Well, listen, thank you so much for doing this! It's been really nice meeting you. And thank you so much for sharing your insights on funding, really intrigued to see how it's gonna go, taking your own kind of trajectory. It's super cool. And where can people get in touch with you, kind of, where are you most active? I think LinkedIn is a good place.

Guillaume Moubeche
So you can easily type like "G.", or CEO of Lemlist and you will find me or https://www.guillaumemoubeche.com/. But I guess my French name is impossible to to spell! So LinkedIn is the easiest way to get in touch.

Todd Chambers
Thank you so much for being on the show and speak soon.

Guillaume Moubeche
Thanks a lot for having me, Todd. Take care!

Todd Chambers
Thanks for listening to the podcast, guys. For links to any of the resources, head over to uprawmedia.com/blog. And super important, please let us know how we're doing! Check the links in the description where you can leave some feedback, or you can just email me at todd@uprawmedia.com. 'Till next time, adios!

Transcribed by https://otter.ai