Riding the Roller Coaster of Entrepreneurship: Q&A With Ben Jabbawy of Privy

First of all, how is business these days?

Things are truly incredible. We ended 2015 with a total of over 10,000 businesses using our software, an incredible milestone for any startup targeting small businesses. This is a major jump when compared with the 50 businesses using Privy at the start of 2015. To say the least, this is been one of those "rocket ship" years.

What led you to start your own business?

Having grown up in a family of entrepreneurs, you might say it was just "what I knew." My father always encouraged us to take risks and be leaders. On top of that, I always considered myself to be both technical and a people person. I found that I wasn't that excited by the typical on-campus recruiting opportunities, and after taking an "Entrepreneurship for Engineers" class at Cornell, I realized I wanted to pursue a unique path that enabled me to combine my technical, creative, and personal skills. Working so closely with founders in my first experience gave me the confidence I needed to take the leap and start Privy.

What sources did you use for startup capital?

To start, I was working off the little bit of savings I had and moved home to live with my parents. After a little bit of traction, I raised some angel money from friends and family to get us to the next phase. Since then we have raised a total of $2 million from angels including Mike Volpe from Hubspot, Accomplice, 500 Startups, and more.

What do you think is your biggest business strength?

Balance. As the leader of the company, it's crucial that you can remain steady throughout the roller coaster ride. How you manage the team when you're at the peak—and how you manage the team when you're at the bottom—distinguishes both yourself and your company. Celebrating wins is important, but you need to understand that anything can (and will) happen. The same goes for those awful, gut-wrenching moments: reacting in a smart, rational way can make or break your company.

Having found myself persevere through many of these peaks and troughs, I'd like to think I've gotten much better at remaining balanced along the way.

What do you enjoy most about owning your own business?

There's nothing more fun than working directly with our customers and hearing how much they love and value our product. It was the reason I started the business, and the reason I wake up excited to go to work every day.

What’s your least favorite part of running a business?

My least favorite part of running a business is that no matter how many great team members or advisors you have, you're forced to make big decisions quickly, usually with very little information. I've always been a big believer in trusting your gut, but you always feel a bit uneasy when forced to make tough decisions on the fly.

What do you think are important entrepreneurial skills to have?

Endless optimism, creativity, and a true passion for helping your target customer. Without these it would be so easy to simply give up when you face hard times.

What are some challenges you’ve faced in business and how did you overcome them?

About a year ago, we signed a term sheet with a large company that wanted to acquire Privy. Naturally this was a very exciting time for us—you work hard to get to moments like that, and you expect that after a term sheet for the deal is signed, the deal will close. However, for a number of different reasons which were never fully communicated to us, our buyer pulled out of the deal on the day we were supposed to officially close.

It left us in an incredibly tough spot, without much money in the bank: $1,000 to be exact. The deal process was incredibly distracting to the team and took up all of my time for three months. Needless to say, this all but put us out of business.

I had to react fast. I called as many of our clients as we could and asked them what they love about the Privy product, why they pay us, and why they continue to pay us. It was incredibly inspiring. I then asked all of our customers if they would be willing to pay us up front for an entire year of service, in exchange for a small discount. Many of our largest customers happily obliged, and just like that, we were back in business.

What do you wish you’d known before you started out?

Being an entrepreneur can be an incredibly lonely venture. Even when surrounding yourself with a great team and support system, there are many decisions and moments that fall entirely on you. I was a bit naive coming into this experience, but wouldn't change a thing at the end of the day.

What is the smartest move you have made with your business so far?

For a while we were afraid to simplify our messaging and distill it into something that everyone could understand. We spent a ton of time and resources trying to educate people on why what we were doing was different, trying to avoid using words like "email collection," "coupons," and others. As soon as we shifted our story and simplified our messaging, everything changed.

How do you find new customers? What do you do to make sure they become return customers?

We use a freemium model so that a small business can take advantage of a free, limited version of our product. In exchange for using the free version, we brand their campaigns with the Privy logo and a link back to our site. We now see 20 percent of our new customers coming from this "Powered by Privy" strategy.

On top of that, we work really closely with our integrated product partners like Shopify, Weebly, Mailchimp, and other small business tools to offer the Privy product to those existing user bases of small businesses.

What’s your management style with employees?

I like to hire people who roll up their sleeves, value autonomy, and employ a "figure it out" mentality. When you can find people like that, even if they don't necessarily have a "press release-worthy" resume, they're more effective and easier to manage. Recruiting these team players makes my job easier as a manager. There's no B.S., no unnecessary meetings, and no management overhead. This also allows me to focus on exposing colleagues to challenges and opportunities that match their career and personal growth goals, all while I lead in a very hands-off manner.

What are some other companies or entrepreneurs you admire, and why?

As a founder serving over 10,000 other small business owners, I have an incredible amount of respect and admiration for every single person who decides to take the risk and open their own business. It's easy to look at Mark Zuckerberg, Sergei Brin, and others like that with awe—and I definitely do—but it's just as daunting and challenging to build a profitable dry cleaning business as it is a tech unicorn.

Do you have a favorite inspirational quote?

When our acquisition deal fell through, a fellow entrepreneur turned to me and quoted Winston Churchill: "When you're going through hell, keep going." I'll never forget that, and it's quite fitting for anyone running a business, so long as you love serving your target client.

What new initiatives are you working on?

2015 was a huge year for us as we crossed the huge milestone of 10,000 small businesses using our product. We're staying incredibly focused this year on scaling to more than 60,000 small businesses. We're focused on projects and partnerships that can help us get there faster, while still remaining a small team.

What advice would you give to someone hoping to start a business similar to yours?

Don't worry about getting mentioned in the press. Forget about making money. Focus on solving a real customer pain and if you can find 10 customers (who you don't know) that are willing to give you a chance, you can get to 100 customers in due time.

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