December 27, 2023

LatAm Expansion Blueprint: PLG Triumph with Osman Koc

In this episode, Osman shares insights on building a painkiller product, market expansion in Brazil, and the importance of urgency in sales strategy. From evaluating business plans to strategic decision-making, the episode offers valuable insights for startup enthusiasts.

Table of contents

Meet our guest

Osman Koc, Co-Founder & CEO at UserGuiding, a no-code user onboarding platform.

Osman started his career in the venture world, gaining experience in startups before founding UserGuiding. From evaluating more than 3,000 business plans and interviewing more than 600 entrepreneurs at his university Angel Investment Network to founding and growing his own startup, Osman brings a wealth of entrepreneurial expertise to the discussion.

Key takeaways

  • As a startup, early challenges are tougher because you have no idea what you are doing. But you eventually get used to that.
  • Having strong founder relationships in the team is essential to get the motivation that you need to survive as a company.
  • Build your sales pitch based on the deadlines and key actions to emphasize the cost of inaction.
  • Understand the problem, what people are looking for, what kind of problems they are trying to solve and offer them a “painkiller.”

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Or skim through the summary of the conversation with the key highlights 👇

Early days and startup challenges

In the first few minutes of this episode, Osman Koc shares his entrepreneurial journey, from the internships in Henkel and Turkcell to his role at the university's Angel Investment Network.

After Osman and his co-founder, Muhammet, faced a few setbacks with their initial business ideas, they founded a tech service business, Why Not Partners, aiding more than 10 entrepreneurs in product development. Their journey led them to San Francisco, where the UserGuiding adventure began.

Osman candidly shares the rollercoaster ride of transitioning from a service-centric to a product-centric company. The excitement of early launches gave way to financial challenges, forcing them to explore unconventional routes. 

"It's easy to believe in yourself when a lot of people believe you. But it is really hard to believe in yourself when almost nobody believes you.

Osman reveals the risky yet rewarding decision to make a lifetime deal with AppSumo, injecting much-needed capital but triggering a customer support nightmare.

Through the tough times, Osman underscores the importance of resilience, especially during the early stages when self-belief is tested. He highlights the strength derived from the close-knit founding team, a bond forged over nearly two decades of friendship. 

“I think having strong founder relationships in the team gave the motivation that we need to survive because, actually, there was no plan B for us. Yeah, we said, okay, we are gonna do that. And yeah, and we are still trying to do that.

On PLG and building a painkiller

After a very successful Product Hunt launch and a lifetime deal on Appsumo, the company started getting some traction. But Osman shares that the main reason for their early success was his ability to create urgency with a sales pitch based on the deadlines and key actions.

“I'm also very happy to give some homework to customers. For example, we will create your first five guides and two segments this week and next week we are going to go live with your existing onboarding materials and start tracking how it is going. I think that's the secret we are doing.”

The dialogue then delves into UserGuiding's target audience and their approach to working with B2B SaaS companies. Osman sheds light on their client engagement approach with a focus on non-technical users and the importance of understanding clients' needs.

“We always start with understanding the needs because nobody is looking for a product adoption tool, right? Actually, everybody is looking to improve their conversion rates. Everybody is looking for some new ways to improve their retention rates, make more sales.”

As the conversation shifts, Osman reflects on how UserGuiding unintentionally adopted a PLG approach, emphasizing their prior experience in web application development. He discusses the impact of an AppSumo deal and the challenges they faced when 2,000 companies started using UserGuiding simultaneously. Osman credits their Head of Growth, Mert, for expertise in inbound marketing, a crucial aspect of their growth strategy.

The dialogue touches on the challenge of being perceived as a necessity (painkiller) versus a nice-to-have product (vitamin). Osman acknowledges that they started as a nice-to-have product but evolved into a painkiller over time, aligning with the feedback from their early customers.

“I think we also started as a nice-to-have product back in the day. But during your journey, yeah, you understand the problem, what people are looking for, what kind of problems they are trying to solve.”

Speaking of their current focus, Osman mentions their efforts to build a manageable KPI management structure for all teams, emphasizing the importance of individual commitment, contribution, and deadline adherence. 

Entering the LatAm market

In the final section of the podcast, Osman Koc discusses UserGuiding's success in the Brazilian market and their plans to expand into other Spanish-speaking Latin American countries and Mexico. 

The company got a very good traction in Brazil, quickly becoming one of the key players in this domain and working with huge names like Toto's, Americana's, Unico. Yet, when talking about their strategy for entering the Brazilian market, Osman admits that there was no 'brilliant' go-to-market strategy. 

He explains that, faced with challenges in building a sales team in the United States which led them to explore other options in the region.

“We raised 200k as a pre-seed round and we were planning to build a sales team in the United States, but we were not aware that the candidates cost the company… are exceeding our total funding amount. And we opened the world map and tried to find the country close to the United States time zone and with the Western talent pool. And yeah, Brazil met both of the criteria.”

Despite Osman's humble presentation of their strategy, he highlights their success in content marketing, translating top-performing blog posts from English to Portuguese, and leveraging Google Ads in Brazil. Osman emphasizes the importance of hiring locals and understanding the unique dynamics of the Brazilian market, citing language barriers as a significant challenge.

Osman also recommends physically visiting the region, sharing his experience of spending almost three months in Brazil, sponsoring tech events, and organizing their own event, which contributed to making more grounded plans for expansion.

Resources:

Full episode transcript

Alper Yurder: In this episode, I'm very happy to be speaking with my dear friend, Osman Koc, who is the CEO and co-founder of UserGuiding. It's a product lovingly used by client success and revenue teams across the world. And for anything from onboarding needs to making sure that your product adoption rates are taken care of. Osman has started his career in the venture world, so he's no stranger to the world of startups. He went on to build multiple startups in his career. And now he sits on the advisory board of many given back, I guess, to founders to be welcome to sales therapy. Osman, how are you feeling today?

Osman Koc: Yeah, yeah, thank you. Thanks for having me. Doing well.

Alper Yurder: Excellent, my pleasure. Now you just moved to London, but for anybody who doesn't know you that well, let's start a little bit with warming up the conversation. I like to start because it's therapy from your childhood actually. So where were you born? Where did you grow up and what led to coming to London?

Osman Koc: That's right. Yeah, cool. I was born in Denizli and I was raised in Konya. I lived almost two years in the United States and as you said four weeks ago, I recently moved to London. I graduated from Boston University with a business degree in management. Yeah, I tried to read a book every week and I try to walk every day. Yeah, I'm very excited to see London's tech ecosystem as well.

Alper Yurder: Yeah, excellent. And you already jumped right into it. You're going to what's this called? World? What was it? Web Summit in Lisbon, right? I went there last year. You're going this year, right?

Osman Koc: Yeah, yeah, yeah. Yeah, I will go to, yeah, I will go to Lisbon tomorrow. And I have never been to Portugal. Yeah. It will be my first Web Summit. Yeah. Let's see.

Alper Yurder: Okay, are you excited to network, meet new people? But get ready to be dazzled by the amount of people because there's quite a few tens of thousands of people you'll feel very much like you're staring at. Who do I?

Osman Koc: Yeah, I heard of it before. I'm not sure how many times I will attend a work summit, but I think I should try once at least. But yeah, everybody was talking about thousands of people, everybody's rushing, no time to build some meaningful relations. But yeah, you know. If you don't try, you never understand. My co-founder Mert, our Head of Growth, will be also in Web Summit. I think we will spend good time with him.

Alper Yurder: Okay, excellent. So maybe let's dive into work a little bit. I'd like to understand how your career started, starting in the VC world, obviously, and what led you to founding UserGuiding and figuring out your founder journey.

Osman Koc: Yeah, happy to share my background in a nutshell. After completing two long-term internships in Henkel and Turkcell, in my final year, I started working for our university's Angel Investment Network. I read more than 3,000 business plans and interviewed more than 600 entrepreneurs. That was a great kitchen for me to understand fundamentals of entrepreneurship. Around that time, my co-founder and very close friend, Muhammet, we have been trying a few business ideas, but all of them failed quickly. Then we decided to leave our business and build our own company to save some capital and understand the entrepreneurship world better. We started a technology service business. It was like a startup called Why Not Partners. We helped more than 10 entrepreneurs to build their first products and acquire new users. It's also a great chance for me to understand entrepreneurship with the entrepreneurship world by working with dedicated founders. Then we decided to go to San Francisco and our UserGuiding journey started.

Alper Yurder: Okay, nice. So I guess in between those things or maybe in your journey in San Francisco, I like that we're talking about success stories here and people who listen to this, they love hearing success, but I know that success doesn't come easily. So can you give us some juicy stories about some of the times where you had some real challenges where you felt like, okay, man, what am I doing, this is crazy, and some of those challenges that we can learn from?

Osman Koc: Yeah, I think the technology service providing job is quite exciting and we were making a good amount of money but you know we have some standard scalability issues as every service provider has. Then we decided to build a product-centric company. That was a good idea and yeah we were in San Francisco. At first, a few months were crazy. Yeah, we were very sure we are gonna crack it. But after a few months, yeah, you know, launches are exciting. But after a few months, yeah, we were out of money. And we tried to raise money. We tried to get some loans from financial institutions. But nobody joined the founding tour that we opened and we didn't get any loans from financial institutions. It was very tough, you know, actually. It's easy to believe in yourself when a lot of people believe you. But it is really hard to believe in yourself when almost nobody believes you. Yeah, it was very hard. And yeah, we decided to go with AppSumo to make a lifetime deal. That was a great idea at first. Yeah, we made a good amount of money in two weeks. Then we started to get hundreds of customer support tickets every day and it turned into a whole nightmare for almost one year for us. Yeah, I think… All states are very challenging, but I think yeah, the early challenges are a lot, I think early challenges are tougher because you have no idea what you are doing. And yeah, during the time you get used to having challenges as well.

Alper Yurder: Are you trying to say it gets better?

Osman Koc: I'm not sure, I try to say we get used to it. We are stronger. Yeah, yeah.

Alper Yurder: So anybody listening should be aware, like it doesn't get necessarily easier. I really like that story. Sharing it so honestly, obviously like for us, raising in the middle of, you know, a very challenging financial time we just closed our round last year. When it started already becoming very scrutinous, it was hard, but I definitely get your idea when others believe in you, it's also easier to believe in yourself. But then when you're getting all those rejections, how do you build up your resilience? So when you're getting all those, where do you go to? Where do you find that motivation?

Osman Koc: Yes. Actually, we are really, how to say, Muhammet and I have been very close friends for 18 years. And yeah, I think, and I know Mert and Alican other co-founders for almost 10 years, back in the day. I think, yeah, we believe in ourselves. Yeah, sometimes I lost my motivation, but Muhammet was having a very good time with UserGuiding. Sometimes he lost, but I love what we are doing. I think, yeah, having strong founder relationships in the team gave the motivation that we need to survive because, Alper, actually, I don't wanna traumatize it, but there was no plan B for us, actually. Yeah, we said, okay, we are gonna do that. And yeah, and we are still trying to do that.

Alper Yurder: I'll get to it now. What are the current challenges? Just before we dive into like the current challenges, I really like that message of having that relationship within the founding team, and I have huge admiration for people who do it on their own, like one founder journey is to me, it's just, well, how do you manage like.

Osman Koc: Yeah, that's what happened. Yeah, yeah, it sounds like impossible to me.

Alper Yurder: Absolutely impossible. You mentioned like a deal that you closed which then opened windows and doors for you, right? Can you tell me a little bit about that? Like how did you find that prospect? How did you convince them to go ahead with you?

Osman Koc: Our Product Hunt lunch was very successful we got good traction from Product Hunt then the AppSumo deal came but mostly my sales pitch is based on the deadlines and key actions, I always try to emphasize yeah the sooner you take these actions the sooner we begin creating some video for you. I'm also very happy to give some homework to customers. For example, we will create your first five guides and two segments this week and next week we are going to go live with your existing onboarding materials and start tracking how it is going. I think that's the secret we are doing.

Alper Yurder: Okay, that is actually great insight and no wonder then why you, I mean, full disclosure here Osman and UserGuiding are a user of Flowla and they have been since the get-go. And actually, we never had this chat so now it makes perfect sense why you love the product because it enables you to do exactly that, like create urgency with the client and handhold them, hold them to account for delivery, right? In sales lingo, we call that like creating urgency and we have different tactics. Some people love using fear of missing out. It's how you tie it to their strategic agenda for anybody listening and trying to hone in on their sales skills. Are there, are there any other tactics you try in a meeting or in advance to understand the client better to, to convince them to create urgency?

Osman Koc: Yeah, that's a great question. We always start with understanding the needs because nobody is looking for a product adoption tool, right? Actually, that's nobody's dream to purchase and pay every month. Actually, everybody is looking to improve their conversion rates. Everybody is looking for some new ways to improve their retention rates, make more sales. Yeah, we always start, what do you need actually? How we can deliver your needs in a shorter time than an easier way. Since day zero, we always focus on non-technical people. That's also a great chance for us to convince people because you know, yeah, when you start asking some time from development team, technical people team, it's also getting harder. Yeah, we always focus, yeah, let's talk about your needs, how we can deliver it, and how you can achieve these goals with yourself, actually. Yeah, we're always emphasizing these two topics in addition to urgency and yeah, some deadlines and key actions.

Alper Yurder: And you obviously work with client success teams, but who else in the revenue team? Who's your key buyer really?

Osman Koc: Yeah, we are working with B2B SaaS companies, mostly product teams allow UserGuiding, but yeah, we are also working with customer support teams, customer success teams, and yeah, but I think 65, 66% of our existing client base are in B2B SaaS. And yeah, we will still target these people, yeah they know what they need. They are problem-available, solution-available. They are easier to acquire. Yeah, the retention rates are also much better than in other segments.

Alper Yurder: We already dived into business a little bit. So maybe it's time to kick off the second section of the podcast, which is diving into specific topics I want to ask you, where you have been building some experience. You've been learning from being beaten up by trying to figure them out, actually. So maybe let's go with the first one, which is, how did you crack or how are you cracking PLG?

Osman Koc: Yeah, honestly, we were not even aware that the PLG map has started. Yeah, it was not on our agenda, but I can give a few colors about how we could grow UserGuiding with PLG approach. Yeah, firstly, as I have already mentioned, yeah, UserGuiding is our second company, actually. Before we have… In the first day, we have already known how to build web application, how to onboard new users. There's a great chance for us to start solving a problem we are already trying to solve for many, many years. And yeah, we designed UserGuiding to onboard product companies for non-technical people and Anastar, Head of Growth and my other co-founders Alican and Muhammet. Yeah, they were very talented to design usable, accessible, applicable web applications. That was the first part, how we can create PLG. The second part, I already mentioned about AppSumo. Yeah, UserGuiding was a primitive tool back then talking about five years ago and when 2,000 companies started UserGuiding, yeah, actually it was super tough, but it taught us a lot because yeah, we were only three people and yeah, we have to go with PLG. Otherwise, I have to hire maybe 10 customer support people. We had to do that, but it really crafted UserGuided. The last but not least, our Head of Growth, Mert, the guy I will be in Lisbon next week, he had a marketing agency and he was very good at inbound marketing. And you know, the leads coming from inbound marketing know your tool, your domain, and much better than outbound and any other paid channels. As a product adoption company, we also could onboard these guys, on to UserGuiding, in a rational way.

Alper Yurder: Yeah, for anybody listening, I think having 2,000 clients at once is not going to be as problematic. Right now, I think their eyes are going like stars and thinking, that's amazing. This was five years ago, you said, right?

Osman Koc: Oh, yeah, yeah. It was five years ago.

Alper Yurder: Excellent. And ever since, of course, the company has grown. Did you ever have this challenge of, you know, a lot of products today face am I a necessity, am I a vitamin versus am I a necessity, a painkiller? Did you ever have that consideration? And if so, how did you overcome that?

Osman Koc: Yeah, I think building a painkiller in the first startup, it sounds very hard to me because yeah, product companies, mostly for other product companies, and it is very, very difficult to understand the whole problem and solve quickly. Yeah. I think we also started as a nice-to-have product back in the day. But during your journey, yeah, you understand the problem, what people are looking for, what kind of problems they are trying to solve. And yeah, we decided what kind of features we need to add to UserGuiding. For example, if you don't have some qualitative feedback collection surveys and NPS as a product, yeah, it is very difficult to become a painkiller if you are not giving the product analytics structure. It's also very difficult. I think, yeah, we started as a nice-to-have product. But right now, yeah, we are a painkiller, according to the feedback from our early customers.

Alper Yurder: Yeah, also according to your monthly recurring revenue, I think you are a painkiller for a lot of people, as far as I know. What about where your top of mind is currently? What are you currently working on? What is the challenge you're trying to solve?

Osman Koc: Yeah, nowadays we are trying to build a manageable KPI management structure for all teams. We have been doing OKRs for over three years. We are happy with that, but we also need to build this KPI management structure to boost individual commitment, individual contribution and deadline commitment. Next week, yeah, we will start the extensive project with an experienced HR manager. Yeah, this is my biggest priority right now. I hope, yeah, in a few quarters, yeah, we will make this structure up.

Alper Yurder: Okay, so what I hear is your top of mind is product as a high level. Because right now, for example, we were trying to be all things to everyone in the co-founding team. We do have a CTO, which is a very clearly defined area. But otherwise, Erdem and I, between us, we try to divide and conquer sales and marketing. But we realized when we focus on something, it's much better. So my goals for quarter four are primarily marketing. So what is for you? Is it product then?

Osman Koc: Yeah, you're actually right. And yeah, we are handling this spark and we're also adding a lot of great features to UserGuiding. Yeah. I guess I didn't understand the question. I couldn't get the question right.

Alper Yurder: So you're currently focused on the product and improving it. That's good. Who generally takes care of sales and marketing? Like, do you still keep that in the founding team or have you hired people for that?

Osman Koc: Yeah, we have Mert. Mert is leading marketing and growth team. Right now our sales team is reporting directly to me, but we have coach Korhan Ercin. He is the ex-VP of sales of AloTech, yeah, we are getting a lot of help from other people.

Alper Yurder: Yeah, I think when you have to build that skill, especially it's very difficult these days to be selling, I think it's, everyone finds it challenging to find prospects to close deals. I mean, it's, it's all a little bit difficult at the moment. Excellent. Um, and which markets do you try to like, which markets do you feel like you've already cracked geographically and, um, which ones are you trying to enter at the moment?

Osman Koc: I see. Yeah. Yeah, we have been getting very good traction in Brazil. I think we are one of the key players in this domain in Brazil. We are working with huge names like Toto's, Americana's, Unico, yeah, all of them are making billions of dollars in annual revenue. And yeah, it is the second-largest market in UserGuiding, I think. Right now we are planning to replicate our success in Spanish-speaking LatAm countries and Mexico. That's, that's our plan.

Alper Yurder: I think LatAm is a great market. It's definitely in our agenda as well. And actually thanks to, yeah, let's talk about that a little bit. Like how did your experience with the Latin American markets come about and how did you grow it?

Osman Koc: It has to be. Yeah, Alper, I really would like to talk about our “brilliant” go-to-market strategy that helped us to conquer the Brazilian market, but that was not the case at all. Yeah, we raised 200k as a pre-seed round and we are planning to build a sales team in the United States, but we were not aware, yeah, the candidates cost the company… are exceeding our total funding amount. And we opened the world map and tried to find the country close to the United States time zone and with the Western talent pool. And yeah, Brazil met both of the criteria and we hired two teammates from Brazil, one in support, one in sales. Yeah, Gabriel is still with us. Yeah, he is a great man. And yeah, after we have some human resources in Brazil, we just started to make some little experiments in Brazil and we saw awesome early traction. Then we decided to invest in Brazil more.

Alper Yurder: Although you say you're very humble that you didn't have a strategy. I love that story but it seems like strategy in that you open the world map and you figure out where to go. What obviously like costs was one but how did you get the early signs of traction demand and how did you grow from there?

Osman Koc: None of that. Yeah, we started to make content marketing because we were already good at English and we started to translate our top-performing blog posts in English to Portuguese. Yeah, it got big traction. Then we started to make Google Ads in Brazil. Brazil is a very authentic country. Acquiring some big names, it is getting easier to acquire some middle market players. Yeah, I strongly suggest people who is thinking of Brazilian market, yeah, you need to hire some locals. It's almost, it's so difficult to grow in Brazil because of some language barriers. I also definitely suggest them to go to Brazil. Last year I spent almost three months in Brazil. Yeah, we were one of the sponsors of the largest tech event in Latam and we organized our own event. That also helped us to make more grounded plans about Brazil.

Alper Yurder: Yeah, and I think outside of business, it's not a very difficult place to be. It's a beautiful country. So it should have been easy for you to meet that decision. Nice. Excellent. Okay. So the last question that I have for you is, is this one that I like to ask people. Let's say you had a magic wand as a leader. Um, what problem would you like to solve? What problem would you like disappeared?

Osman Koc: Yeah, that's an interesting question, Alper. Yeah, I remember writing about this subject a few years ago in my personal blog. I was saying that if you would have a magic wand, you have to say the magic words correctly. Honestly, I didn't change my mind yet. But I can answer, yeah, if I would have a Palantir that shows the future. I think I want to use my Palantir to understand which features will add the most value to our customers. Of course, we are making a lot of research on this topic, but you know, it is very difficult to get some real answer, honest answer from the clients, what they need, what they're looking for, what kind of problems they are solving. I will use my Palantir to solve this issue.

Alper Yurder: Ok, insights, almost exclusively neither answer me with some insight. I think we all want to see the future. And obviously in terms of the buyer journey and what the buyer wants, which deal moves forward, what content they're actually interested in, etc. We try to build that into Flowla. I think insights are almost, they come up somehow in every conversation. Excellent. So we come to the final section of the podcast, fire rapid questions. So in this section, I ask you three questions. I give you one minute to answer each and we go fast. Is that okay for you?

Osman Koc: Yeah, cool.

Alper Yurder: Excellent. So these will be as a leader, as a closer and as a starter. Okay, so let's go with as a leader. What's your top priority when you're leading a team?

Osman Koc: I think it is “get shit done.” Yeah, next question please.

Alper Yurder: That was a very, very simple answer. Great. And as a closer, I would say, what's your go-to strategy for sealing a deal? You said you didn't have a strategy once, but you should have one now.

Osman Koc: Yeah, actually I think I already mentioned about yeah, I'm always trying to time to value. Because I know everybody is in a rush and competition is for everyone. I'm always emphasizing, yeah, if you start today, you will start improving your product adoption metrics tomorrow. But if you start using UserGuiding two weeks later, yeah, you will lose two weeks of improvement for your product, for your team, for your company. I'm always emphasizing this urgency and deadlines.

Alper Yurder: Excellent. And next question is, as a starter, how do you handle uncertainty and risks when starting somewhere new?

Osman Koc: Yeah, I think our listeners got our point. Yeah, we are not focusing too much on uncertainty and risk. And I think we are too lucky because yeah, if you made some assumptions and yeah, overthinking, I think yeah, we are not having this call together. And our earliest investor and my super advisor, no assumptions, no overthinking. Yeah, it's kinda down thing at first, but you get used to having this kind of uncertainty and risk. And I also think, yeah, this no assumptions, no overthinking mindset makes us braver.

Alper Yurder: Okay, excellent. Just because we covered these two topics really well, I'm going to add in two there if you don't mind. One is obviously your top market. So anybody who wants to enter the Latin American market, can you give your top three tips? You already mentioned them, maybe in a summary.

Osman Koc: Yeah, hire some locals, go to Brazil, and make content, create content in Portuguese. Yeah, would be my three top suggestions to everyone.

Alper Yurder: I think “create content” was an excellent one by the way, because we already create a lot of like English content. So why not just translate them and, you know, localize them. I love that. So Osman, this has been a great chat. Our time is over, I'm afraid. And like every good therapist, I'm gonna have to cut us on time, unfortunately.

Osman Koc: Yeah, why not? Absolutely. Yeah.

Alper Yurder: If people want to find more about you, what's the best place to find you? Is it LinkedIn, Twitter? Do you want to share any credentials?

Osman Koc: Yeah, LinkedIn is the social media platform I am on. Yeah, people can reach out to me for any kind of issues about this journey.

Alper Yurder: Alright, so that's a wrap on this episode of Sales Therapy. If you want to listen to us, tune in, and follow the next episodes, subscribe on your favorite platform, and see you next time. I'm your host, Alper Yurder, and this was Sales Therapy. Bye.

Osman Koc: Thank you.

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