I reinvent myself every year — Stefan Batory, Booksy
Today we publish my interview with Stefan Batory, Co-Founder and CEO of Booksy.
Booksy is the leading beauty and wellness appointment booking app used by 13 million consumers in e.g. US, UK, Poland, Spain, Brazil, and South Africa. It was founded by two Polish serial entrepreneurs Stefan Batory and Konrad Howard. They partnered with Inovo Venture Partners in 2015 and by 2021 they raised a total of $119 million in VC funding. After the merger with Versum, Booksy is now a team of approx. 600 fantastic people, who shoot for the moon. Their goal is to become a unicorn soon, then a decacorn and eventually the biggest company from Poland.
I sat down with Stefan to discuss:
✅ building a VC-backed global business and what would Stefan do differently if he could start all over again?
✅ how does the founder’s role change as the company grows?
✅ and what has Stefan recently learned from Roger Federer?
You can also find this episode on: YouTube, Spotify, Apple Podcasts, Google Podcasts, Spreaker.
Stefan, I’ll start with a tough question. In order to build a large global company do you have to take VC funding?
The answer is simple: it depends. It depends on what sector you’re in. What your ambitions are. What you want to achieve. What the competition looks like. In our case, it was inevitable because we’re building a marketplace. A basic rule of marketplaces is that ‘the winner takes it all’, and we have to fight for first place in every market in which we operate. If competitors are taking money from VC funds, we’re not capable of winning that market without also taking VC money. So, in our case, you have to take the money.
It is one thing if it is a winner-takes-it-all market but what else should such an entrepreneur take into account?
It’s also a matter of personal preference. I’ve talked to a lot of founders who were proud of the fact that they never took money, they never took outside funding. In startup-speak, they’ve bootstrapped the business and they fund themselves. I very much admire what they’ve done. However, it is a question what they want to do in 5 or 10 years. It’s also a question of whether they want to run this company for the rest of their life, pass it on to their children and have a family business. Would they rather have 100% ownership of a smaller cake or do they want to build something very big, not necessarily controlling the company and not necessarily being its sole shareholder. And those are really the things that apart from the market itself and the competitive environment I think should determine whether or not to take the money. You surely shouldn’t take money if you are someone who is content with a slightly calmer pace of growth and treats running the company as something they’d like to do for the rest of their life. Because I’ve seen cases where the founders take money from funds in order to build a product in order to jump on some trajectory. Then, there was a problem with what to do next because they didn’t want to collect any more rounds. They didn’t want to take the company public. The funds had trouble getting out and the founders didn’t quite have an idea how to give those funds a way out.
Mariusz Gralewski (DocPlanner) once told me a very wise statement that when you take money from a VC fund then you have to want to keep playing the VC game. And the VC game is about fighting for big gains. You have to fight for the company to grow very quickly and you can’t be satisfied with the fact that it’s growing 20, 30, or even 50% a year. If I ran this company alone I probably wouldn’t put so much pressure on myself and it’s not even like someone is forcing me to do this today. When I took the money and I said A now I have to be consistent and say B. And that’s probably the basic question founders should ask themselves; whether they want to take on that kind of pressure and race it for many, many years. Because it’s not a sprint. It’s not something that will only take a year or two. In our case, it’s been six years and I still feel like we’re at the beginning of the road and that it won’t end anytime soon.
If there wasn’t a VC, do you think you personally would still be putting pressure? How do you, as Stefan, approach this?
I would. I’ve always put pressure on myself, but there are times, there have been times over the last six years, when I would have slowed down for a moment. But I felt this responsibility to the employees and to people who have joined Booksy in managerial positions, to the investors that I promised something and I felt a responsibility to deliver. If I was doing this solely for myself then at least twice in the last six years I would have said… or at least strongly considered slowing down.
One founder asked me recently while wondering whether to take financing or not… he said that he is spending so much time on the product it’s such a passion of his that he is afraid that when he raises the first round he is going to have to play the VC game instead of working on the product. That he is going to become a person only responsible for fundraising, who keeps running after investors and not after customers.
What would you tell this founder? How would you approach it?
I’m sure he’ll have to run after investors. The only question is whether this will allow him to build a better product and whether he’ll be able to hire people who will help him both run after investors and build a better product and win the market. The question is also about the ambition of this founder and in what kind of competitive environment he operates. It’s hard to give advice to someone without understanding or seeing what they’re doing. But either way, as his company grows, there’s going to be less and less time spent on the product and he will be doing other things. So, I would say that it’s inevitable.
Let me ask in a different way, how much influence do you still have over the product?
I have practically the same amount as I did in the beginning. But I have a partner who deals with the product, and that’s Konrad’s thing. The way we spoke about the product then is the same way we speak about the product now. And I don’t feel like I have less time for it.
Because you talk to customers, right? I remember such an anecdote about going through the jungle and taking the machete and going to clients…
I like it and I do it all the time. I give Konrad feedback all the time when I meet with clients, as I did 5 or 6 years ago, I still do today. So the fact that I took money from funds doesn’t relieve me of my obligation to groom the product and talk to clients nor do I feel that it’s taking up my time. I think more of my time is taken by managing the company that’s getting bigger and getting more difficult than the fact that we have funds and that we have to raise another round.
You have many different funds on board. Do you see a difference between them? How does it look? In particular, between let’s say Polish and foreign funds. But also, between funds in general.
First of all, the foreign funds are overrated. I think the difference here doesn’t run along the line Polish or foreign, but rather who runs this fund. The thing that I’ve learned in these last six years running Booksy is that at the end of the day it comes down to the partner you’re gonna work with and to the DNA of the fund. And how the fund actually supports companies.
I talked to a lot of founders of American companies that have taken money from large, well-known funds and I once heard a phrase that shocked me but I pressed the topic because the sentence that shocked me was that “we shouldn’t absolutely take money from Andreessen, Sequoia, or other well-known funds”. And it sounded weird because everyone would want to receive a term sheet from Andreessen or Sequoia. That founder explained it and said “when you have a meeting of the board — so, a supervisory board which may not be a good translation into Polish — when you have a board meeting with some famous person from some large, well-known fund there’s a very good chance that everyone else at that meeting will just agree with this person. That everyone would be afraid to ask questions, to discuss, and that really a company like that has much more to lose than to gain.
And that’s kind of one of the things that I appreciate very much in Booksy’s board and in this mix that we’ve been able to build — that no one here is afraid to question what anyone else says and that we have a very cool mix of very different investors with different experiences and everyone brings something of value. And inviting such a…
…Super Star…
Yes, a star or a big name I can actually imagine that it could end up with everyone agreeing with them and this one person in a somewhat unconscious way will take control of the company and will undertake key strategic decisions for that company. It is often the case that the founder then takes up a subordinate role. They think that if Marc Andreessen said it had to be done, it means it’s the right thing to do.
How would you conduct the process of raising money today? I mean would you talk to VCs or business angels? For someone getting ready for their first fundraising, maybe not friends and family, but a more professional round — how should they do it?
I’m very sorry I never went through any accelerator program. I’ve run companies before so I wasn’t a rookie and I thought there were things that I already knew, and I thought those accelerator programs would be a waste of time. But today, in retrospect, I regret it very much. It seems to me that if there is one very general piece of golden advice that I can give to entrepreneurs who are for the first time, setting up a company, have built a product and they’re thinking about securing VC funding, it would be to go through an accelerator program either in Poland or one in Western Europe or in the United States. The ‘where’ probably depends on where they want to raise the next round of funding. If they want to raise more rounds in the Sates, the big value of such an accelerator program in the States will be that they’ll have easier access to those investors. Also this accelerator program will give them time to build relationships with investors. Because the angels that are mentors there will have time to get to know them, to watch them. So when they throw in their first tickets it makes it very easy to go to the next fund to put together this institutional round and say we already have that fund and that fund and that fund. That’s something I missed a lot. When I went to the States I had been in Europe too long and I raised too many rounds in Europe. It was like I had golden handcuffs. That was probably one of the biggest mistakes that I made.
You had good angels early — you have to admit we have great angels on board. Besides us, you had some good international VCs that invested early. If you were to do it again, would you take money from business angels early? As soon as possible? Did they bring in value?
I would take on business angels as soon as possible. They certainly brought value in the Polish ecosystem but they didn’t contribute as much value in this American ecosystem. I mean, those Polish or European angels didn’t actually help us to raise money abroad, and the Western European funds really didn’t have such a good relationship with American funds.
Interesting.
I would say that Western European funds are overrated. So even today, despite the fact that Inovo was a fund that invested a few years ago and it might seem that the funds which entered in the last rounds are more experienced in the later stages of funding, but to this day Michal Rokosz (Partner at Inovo) still participates in our board meetings and has a very active voice there. You really help us a lot. Like I said, it depends more on who is on the board, who is a partner at the fund than on which country the fund comes from. I’m more about relationships with people and I see more value in people than in any particular brand. For me, you and Michal and Maciek are a brand.
So, Inovo above all. Inovo and then an accelerator program. Ok, I said that…
One doesn’t rule out the other. Again, it depends on what the next steps are. But if someone is thinking about raising money later in the US, then at the earliest stage possible they should have angels, seed funds or pre-seed funds from the States.
One of the problems I had raising B or C rounds in the States was that those funds felt uncomfortable going into a company where they don’t know anybody. One of the investors didn’t tell me that directly, but he said it to the person who introduced us and later acted as a back channel with him. This person heard him say “great company, great founder; they have a great trajectory. But how am I gonna go in there having 10 or 15% not knowing a single VC? If someone comes along and says that they want to buy this company for $2 billion, then I don’t know if they’re gonna sell or not. And I would like to be at this company a lot longer because I see the potential in it”. And it was kind of a fear of going into the unknown.
So, he was afraid they would sell.
He was afraid they’d sell because he was afraid of the mentality of European VC funds. For one, he had a preconceived notion about European VCs that they will quickly settle for less success because they have less ambition. But even more so, I think, because he just didn’t know anybody there. It’s just that people like to work with people they know. People like to invest in companies or founders that they know. If they don’t know the founders personally, they like to invest in companies that someone they know has already invested in. And kind of a self-fulfilling prophecy.
We’ve been spending a lot of time building a network in the States. It takes time and is hard. But it also seems to be changing a bit because these American VCs in the past two years have opened up a lot in Europe. They’re investing a lot more. When you guys were still fundraising the previous rounds; then it was very much like — you had to go and sit down with an investor, they had to see you, and you had to be in the valley. That seems to be changing today, wouldn’t you say?
I don’t know what it’s like in the earlier stages because the rounds that we’re raising today are with later-stage investors. They are more growth funds, a little bit of private equity with whom we’re talking. They’re generally investing globally. I can feel the change, but in our case, it comes more from who we’re talking to. I don’t know what it’s like in those earlier stages, but watching the market probably a lot of what you’re saying is true and is happening. I think, like you say, these relationships are being built. If you as Inovo co-invested with Andreessen, because you have, then the next time when Andreessen will be investing in a company which includes Inovo, they already know you and it’s not a problem that there’s ‘an unknown VC’. But a few years ago the fact that we had only European investors was a problem.
Circling back to those business angels from Europe, we have an angel from Germany, Kai Hansen, he was also a guest on the podcast some time ago. He brings enormous value and even in the States I believe he helped you. How do you see it?
Kai brings huge value. All the business angels we have bring enormous value. It just kind of depends on the perspective and from what angle this value is assessed and measured. In Kai’s case, our last round probably wouldn’t have happened or rather wouldn’t have happened with the current line-up or setup if not for Kai, because Cat Rock, who led our most recent round, previously invested in Lieferando, where Kai was one of the co-founders. So this is where the relationship was built.
And that’s exactly the mechanism that I was talking about that people like to invest in companies where there are already other people they know. And here the fact that Kai was one of our board members and an investor helped us a lot.
I think that back-channeling in the context of fundraising is very important. When we invested in Booksy’s seed round we were still learning it, but now we have a much bigger network. When as a founder you go for a meeting with a VC in the States usually, and correct me if I’m wrong, but they usually say, “Awesome, you guys are great. We won’t invest now because it’s still a little early for us but maybe in the next round”.
That’s exactly right.
In our experience, it really just means “no” and this can be for many reasons. A good VC is one that is capable of calling that fund and asking them, “Just tell me honestly what happened there?”. So communicating VC to VC or even VC to business angel when that relationship is built, and building relationships is the most important part of our business, then they will tell you. The other fund will tell you what went wrong. And why. We do it today as our companies are fundraising, we do it a lot. We call these people in Europe or in the States and we say just tell us where you’re really at. And that’s the role of a good VC.
And that’s exactly the role of a good VC and that’s an enormous value. Honestly, without that, it’s very often only money.
Over the last year you have acquired a major rival in Poland. Can you talk a little bit about that? What did the Versum takeover look like? Do you grade it positively or negatively? How did you analyze it?
Let me start by saying that this was more a merger than an acquisition. And there were several components there.
First of all, we wanted to show that the market in Poland itself is very large and we wanted to show what value can be built. For a few more years we’d still have to fight Versum. We believed that we would ultimately win this market. Versum believed that they would win. And if we had fought them for a few years in this market, we’d probably be making progress, but we wouldn’t have such a clear picture of what a conquered market would look like. So the first step for us was showing what a conquered market means. How will this situation play out in other markets in other countries when we get to that same level; we called that ‘the end state’. Of course, we don’t have that yet because we are in a long and arduous process now of integrating and migration of marketplaces and products and so on. But we know it’s gonna happen in the next few months. That was kind of the first piece of the puzzle.
The second element was the team. Versum has built a great team of people who have cut their teeth on building a product for this industry, in sales and customer service. They built a phenomenal customer service team. They had very well organized processes in place. The second piece of the puzzle was just increasing our intellectual capacity. Adding the team one hundred and several dozen people who could immediately join our teams. We were able to do certain things faster and much better.
And the third element was to build or faster building of critical mass. It was no longer just about Poland but in general increasing the scale of business because the main problem with this type of business is that there is high initial costs. Because building a very good product that you can win with in this industry around the world costs the same regardless of whether you have a thousand customers or 10,000 customers or 100,000 customers. So this fixed cost associated with building a product is large, and the faster we achieve a certain scale the easier it is for the profitability of the whole business. So that was the third element that guided us — to build critical mass as soon as possible.
Are you thinking about further acquisitions?
We’re thinking and I can tell you that a week ago we closed another deal. We’ll be communicating it in the weeks to come and it is a big competitor in the American market. One of the oldest companies that operate on this market. And we have a few more acquisitions in the pipeline. I think this year, we’ll make two or maybe three more acquisitions.
This is interesting. How do you analyze the companies that you’re taking over? Maybe two or three indicators? Or what do you look at when looking for companies to acquire?
The most important element is whether this company will help us build a stronger network effect. So it must be a company that operates on one of our core markets just as Versum operated mainly in Poland although it did have customers around the world, but we looked at it from the perspective of Poland. It’s the same way when we talk to our competitors from the States or from Brazil or from Spain or from the UK because these are our core markets. We want the synergies and business building in our core markets to allow us to slingshot and amplify our network effects because we know that the stronger the network effects the easier and faster and cheaper it is to grow. So that’s the basic criterion. We have a gateway here to enter new markets through acquisitions and we are considering one acquisition quite seriously but we must then have a strong belief that by taking over this competitor and giving it a great product that Booksy is and some of our know-how that we’ll be able to very quickly win this market. We’re not interested in becoming the second or third player in this market because of what I was saying earlier that the winner here actually takes it all.
New markets meaning countries you are not present it, so not Poland and not the United States.
Countries where we’re not present or even if we have a few or a dozen salons, they’re just random customers because we didn’t really do active acquisitions in these markets.
When we analyzed this before these first acquisitions it seemed to us that it would be great for you to have the ability to take over companies and to incorporate them into your structure. It would be a huge advantage because then you become a player who is able to consolidate the market. Other than Booksy I don’t think anyone does that today, right?
I don’t think anyone does that strategically today. There are several players who have some single acquisitions or mergers but, I would say they were probably accidental or sporadic, and I don’t think they were a part of their strategy. We have a good chance to consolidate this market and just as you said after the three deals that we’ve already done now we just closed a fourth and if we do two or three more this year the goal is to work out a standardized process of conducting the deals and then the integration after the acquisition. If we can do that, then next year we’ll be able to accelerate even faster.
Even faster? That’s okay. I would say that this is very characteristic of you and Booksy, one of the things we’ve noticed in the last few years, is the ambition. You guys have a gigantic ambition to build a big company. I mean if Booksy was to have a headline in Forbes that “We were taken over for hundreds of millions” I get the feeling that everyone in the company would be unhappy.
It would be a failure.
It would be a failure and that’s something that definitely characterizes this company from my perspective, well from our perspective I would say. To me, you’re just that kind of person. Even when I think about running then you didn’t just start running but you ran seven marathons in a week. Can you talk about that for a moment?
You must be thinking of the Sands Marathon. It’s a 250 kilometer run in the desert with a backpack in the so-called self-sufficiency formula. So you have to carry everything in your backpack that is needed to survive a week in the desert. And day after day you run on average 40 kilometers. There are some shorter and some longer stages.
And what would motivate you to do that?
You know what, the first time, I just wanted to see if I could do it. The second and third time I wanted to do better. The second time I wanted to see if I could finish in the top 100 and the third time — if I could finish in the top 50. And I think that’s a good analogy for the funding question you asked, if I were on my own would I slow down. For a few years now, actually three or four years, I don’t run and train as intensely as I used to because I run Booksy and it is my main goal. You can’t work hard and train and still have a family life. You can’t combine all three of those things. With the level of stress I’ve been under the last few years I decided to put running on the sidelines. But I’m going to go back to the Sand Marathon and I’m gonna want to finish in the top 25. I kind of look at it this way from the business side of things. If I were alone, maybe for a year or two I would have slowed down to rest a bit; then go back out and put it in sixth gear. And here the decision I made was that at Booksy I’m in sixth gear all the time and I disengaged from the marathons and with workouts but with the idea that someday I’ll get back to it.
That’s something I didn’t know. You ran the Sands Marathon three times.
Yes, three times.
Bravo. What are your ambitions today? What is a goal or ambition of yours?
At one time, our goal was to build a unicorn. Today, knock on wood, but I think that we can say we’re on the eve of it. It’s more a question of when we raise the round that will validate the valuation. Whether it’s in six months or twelve or eighteen. There’s no easy answer to that yet because we don’t have to raise money today. We’re in a good enough position that we don’t have to raise a round. Maybe we’ll raise it earlier or maybe later, so this valuation and the realization will come when there’s a round. However, for probably two years now, we have been thinking that a benchmark or even a test to measure this ambition was to build a decacorn which is a company worth $10 billion. I once had a conversation with one particular investor and he said — to sum up our conversation — that it will be very difficult to build a unicorn, but when we build it, then the decacorn is almost a certainty. And we wonder if this could ever be a $100 billion company. We wonder if Booksy can be the biggest company ever built in Poland. And I think that’s the level of ambition that we’re starting to aim for today.
How does that affect day-to-day decisions and little things in the company? Can you give us an example?
I don’t know if that has any bearing on the day-to-day small decisions. More likely to have an impact on big decisions. Like you said, if someone came in today and said that he was paying us a billion dollars for Booksy we would have turned that offer down. We would turn down two billion as well. Probably also five billion, because somewhere out there we believe very deeply in our hearts and I guess in our minds, too, we’re hardwired to think that someday it could be a very large company and everyone who is running this company today would like to take on the challenge. We want to see how big it can be.
But I have a very cool analogy for running and am a little bit subconsciously guided by it in my business life. When I ran ultra marathons, 100 kilometer runs or even 100 mile or that Sands Marathon where it was admittedly shorter distances but day after day, it’s often the case that when you stand at the start of a race and think about the fact that you’re supposed to run 100 kilometers and that it’s going to take 8, 9, or 10 hours, and in the mountains even a few dozen hours, it is a thought that scares the hell out of everyone. Even someone who has done it a few times before. And if I only thought about that I’m supposed to be at the finish line in, I don’t know, 16 hours, and for 16 hours I’m going to be on my feet running nonstop; uphill, downhill, uphill, downhill, in the sun, in the rain, in the snow, because the weather in the mountains changes a lot — it’s just scary. While running, in the back of my mind I always have this big, ambitious goal, but I’m concentrating on getting to the next stage, to the next health point, to the next bend, to another hill, to another tree. And it’s not always the easiest way. It isn’t always the optimal path, but I know I’m moving forward.
Once, in a conversation with Darek Duma he summed it up very nicely, that a lot of people who have such ambitions or such dreams stand on this starting line paralyzed and afraid to take the first step without feeling that their path has been planned perfectly. And this road cannot be perfectly planned. We’re trying our best to plan this upcoming phase, maybe two, and then we have some vague idea of what the third, the fourth, the fifth and the tenth are going to look like and as we get closer to that first checkpoint, then then we try our best to plan what this next stage is supposed to look like. In that sense, it is a bit of a zigzag because sometimes we’ll deviate from the route. Sometimes, we’ll even make a little loop and take a step or two back but all the time we know that we’re running more or less in that direction. Even, if it’s not always a perfectly straight line.
And Booksy is running in that direction?
Yes. Today, I can say that it’s running because a year ago I probably would have said that we were crawling. But, we were still moving forward.
A few years ago, you had this “North Star” — the most important metric that you were looking at. Those were customer bookings. What is that metric today? Is there still something like that? What is the most important thing that you look at?
You really hit it with that question because we’re literally on the eve of making that decision. We have a very strong candidate, but it has its flaws. I don’t know if it won’t be too complicated to explain in this forum without going into the nuances of our business, but it is cross category GMV. So, it is the value of bookings that are made through Booksy, but in categories other than the one that the salon that encouraged you to use Booksy is in. Very complicated. We’re wondering how easy it will be to operationalize. It has a few other nuances, but it probably best represents, at this moment, whether our growth is healthy.
Because in our case… when you build a marketplace you have to have a diverse base or diverse supply side. It’s very easy to fall into the trap where when you only look at customer bookings — which was our North Star for many years — it’s easiest to look at barbers because they have the most. But if you only have barbers then people won’t really have anything to book other than barbers. So we were looking for a metric that would be good at reflecting all these nuances of what we do on the demand side, what we do on the supply side, and measure consumer behavior. That it wouldn’t force or encourage us to not be merchant first. It’s one of our values. We want to be a partner and we want for the good of our customers to guide us. These are the salons, or merchants, even service providers as we refer to them. The cross category GMV feels like the best reflection of all these things, but it still has a few flaws. We’re just discussing how to operationalize it, because last year we had the idea to go with GMV and literally in January we started implementing this and then in March it all came crashing down. So these last 18 months, we were living in survival mode thinking more tactically than strategically, and right now we’re going back on this path of strategic thinking and long-term planning.
And when you think about it, two years from now, where would you like Booksy to be? You know, ambitiously. Not necessarily a plan or a budget, but two years from now, when we meet for an update podcast, where would you like Booksy to be?
I would like for us to have a feeling that we’ve won the American market or we’re literally in the final stretch. This is our biggest, most important market. The most difficult market to win. We have a few dozen competitors. It’s terribly fragmented. It’ll be terribly hard to win the whole market at once. We rather think of this market as cities but if we win the first few dozen cities, we’ll probably be on a path to win the rest of the country. I hope that in two years we’ll be at that stage, and then it will also allow us to think more boldly and broadly about opening up new markets. And then it would be such a cool stage if we could win those first dozen cities in the States and start to think about the rest of Europe, about South America and Asia. It would probably also be the last, very long home stretch of realizing that dream of being the biggest and most well-known consumer brand in the world, originating in Poland. And that 100 billion is probably some way of measuring that success. Because if we get that valuation then probably we will be the most famous brand coming out of Poland.
And where you are strong in the States? In which cities?
We’re very strong in Florida. In Miami, Orlando, Tampa, and a bit in Jacksonville, too. We’re pretty strong in Texas. In Dallas, Houston, San Antonio and Austin. We also have, in English they’re called pockets, these pockets or micro pockets in the rest of the States. But primarily in Florida and Texas. And, I would say these dots or tiny hot spots which we hope to develop primarily in California and New York because those are the two most important. Oh, and Chicago. I forgot to mention Chicago, where we also have a very strong position.
There was this story a little related to this about how when you reach a certain KPI in the States, I don’t remember what it was, that you agreed with Andrin Bachmann, one of our investors, that you would run across the States. What was it?
I once asked Andrin and the whole board that when Booksy reaches $100 million of revenue in a year that they give me a three-month leave of absence because I’m gonna want to run across the States. So, from California to New York. Literally, two or three weeks ago I asked Andrin, or I said that I’d like to push that boundary to a billion revenue because I think almost certainly within the next 12 months we will exceed $100 million in revenue.
And you would have to run.
I would have to run and I wouldn’t be able to get ready on such short notice. It happened a little bit faster than I thought. If not for what happened last year globally, I’m sure it would probably happen faster and I’d have more predictability and would know that we were on the right trajectory for it to happen. But because of what happened, I dropped my guard and didn’t start training early enough.
And did he agree?
He laughed and agreed. He said he very much enjoys this even more ambitious goal.
Going back to the subject of ambition, but also your personal approach. A few years ago you moved to the United States. How do you assess that? Who should move to the States? For whom does it make sense? For whom does it not make sense? How do you see it today?
Today, first of all, I regret that I moved so late. I should have done it much earlier. Moving to the States — this decision was guided by three objectives. First, we had this feeling that in Poland and in Europe, it’s going to be hard for us to raise big rounds. We should be in the States to build relationships with investors. From that standpoint, I just did that too late. The second was just to be close to clients, be close to our largest market to understand it better. Because often nuances determine whether this product that we build for this market or whether the decisions we make will be good or not. On paper or in Excel, everything looks good. I always like to feel. I like to visit hairdressers, visit beauty salons, and talk to end users. It always gives us very cool insights when we meet with our clients. The third thing is that it’s hard to build a team completely remotely. Of course, last year changed that and everyone learned very quickly how to work remotely. Nevertheless, I still believe that I have a better finger on the pulse of the organization; I understand what’s going on in it when I just meet people. Especially, when they are real-life meetings, sometimes going out for a beer or just sitting with these people for a few hours talking. And not a transactional call where we meet, we discuss a particular topic, we finish and we move on to the next call with the next person.
You’re talking about your American team, correct?
Yes.
What does your day look like? How do you run a company in both Poland and the States? It seems very complicated. The difference in time zones is a problem for many people. How do you approach it? How does it work?
It was a very big problem for me, too. It turned out to be a lot more tiring than I thought. A nine hour time difference is a lot. Getting up at five in the morning to start making those calls while it is still dark outside, while my body hasn’t fully woken up, and my intellectual prowess is at much lower than it should be. And then working with the American team basically meant that at the end of the day I didn’t have the energy to do anything else. After a day like that, I was just dreaming of going to sleep. And that’s one of the reasons why I temporarily moved to the East coast. To reduce the time difference. There are obviously a few other reasons for this decision because Florida opened first. We’ve now opened offices in Texas in New York, so I’m kind of moving around more on the East coast and I’m where our new teams are. And three hours less in terms of the time difference, is a very big change because I can get up at 6 AM to run, shower, and, eat breakfast; even if at 7:30 I start making those calls it’s still only 5:30 in California. I work with the Polish team in the same hours that I was working living in California, but at least now I can see the sun, see the sky, see people, breathe a little fresh air and I have a whole different comfort level in this job and I feel completely different.
In California you woke up at 5 AM and in Poland it was 2 PM.
Yeah, and I would immediately sit down to calls. Additionally, in California it was still terribly dark, which was very depressing for me. So, these are the little things. I wasn’t thinking about them when I was going; I thought it would be okay. That the nine hours difference can somehow be managed. But it was a lot harder than I thought.
That means that in California until 5 PM or 7 PM Polish time you were on calls with Poland.
Yeah.
Then, until the end of the day you sat with the American team and ended up very tired because it’s just crazy. As a result, you moved down to Florida. And it’s better there? It’s OK? Or is it just a little better?
It is much better, but it is not ideal, because we have this time difference, but it’s really much better. Mostly because when I start work it is already light out. I don’t know how to explain it. It’s just, in Polish… no in English they say ‘day and night’. The difference is like night and day. For me from a biological standpoint, from a psychological standpoint; it makes a big difference. When I get up and can already see the sun. I can hear the birds chirping and see the sky I can go for a run and eat breakfast. I sit down with a completely different attitude. It really made a big difference.
So you do go running in the morning?
Now, yes. But in California, I wasn’t able to do it at all. But I wouldn’t call it training in the sense of marathon training. It’s more clearing the head and just moving around because I sit all day now. Compared to office work before, there was more movement. When I went to meetings I would get up from my desk. But if I sit at home all day my body needs some exercise, too.
There was a story that you won some run around the bay in which you got a case of beer or something. And you gave it to someone in bigger companies. And that helped us a lot.
There actually was a situation like that. When I first moved to the States then right out of the gate I took part in a run, I think, of 5 kilometers around San Francisco. It was a very difficult run because San Francisco is very wavy. It was nonstop uphill and downhill, but I won that race. The sponsor was some local brewery and they just gave me a whole case of beer. I don’t really like beer and I didn’t really have anywhere to keep it because we were still living out of suitcases at the hotel. So, the next day I went to Google to the Project Manager who was our primary point of contact there. I gave all that beer to the team at Google. I don’t know if it was that important or not. At the end of the day, in a relationship when it’s good it’s good, and it’s hard to pinpoint to one particular thing that caused that. Just like when it is bad it’s usually the result of a few different things but it’s fair to say that it broke the ice between our two companies.
It didn’t hurt.
It didn’t hurt.
Stefan, you’re one of a few founders who are already very far along on the road to building a big company. Can you tell me how your role changed? What you do? How you worked at each particular stage or moment?
It’s cool that you asked this question. Literally, two days ago Zach Coelius, who is also our investor, who you connected me with, made a very cool post that being a founder is probably the only profession in the world where the better you become and the more you learn the harder it is for you to be that founder later. Because… every time we as a company jump to the next level and I learn to function on that level, it opens up to me a whole bunch of new things I have to learn. The more successful the company is the more I feel that I’m not. I’m not up to the task of the role. The more I learn, the more I realize how little I still know and how much is still in front of me. And, at times, the more it overwhelms me.
I remember that you and OpenOcean and Kai said that… the key is to build a good team because without a good team, we couldn’t have done it. I’m able to learn just from people who have joined Booksy. From Gosia Szturmowicz, who joined us as CFO. From Marcin Borowiecki and Adam Gorniak who joined almost three years ago. Marcin runs the States and Adam all the international markets. From Konrad Howard who is my Co-Founder, whose passion, as I said, is the product. Just surrounding yourself with people who are better than you gives you any chance at all to develop, to learn something from them and they’re some kind of beacon or a lighthouse that shows me directions and areas in which I still need to improve or still have something to learn. I also remember my conversation with Michal Rokosz when he was more operationally involved as COO. When I talked to him about what I have to learn in the next year. Michal had already been in some big companies. He worked in Rocket Internet, saw success and Michal was very much my first lighthouse. And was the first to openly say Stefan, here you’re awesome but really, if this, this, and this isn’t improved you’re not going to make it in the next round. Or good people will join and you won’t know how to manage them. And that’s probably the biggest challenge I’m facing right now; that every year I have to reinvent myself, I mean, I have to define what I have to learn, what will be my most important task for the year and how do I get to the point and reach that next level.
So I guess that’s on the one hand the coolest thing about being a founder. It’s a job that never ends in terms of self-development and learning because if you start from scratch it doesn’t matter what stage you get to, whatever it is you’re most likely to get to a stage that you’ve never been to in your life. You’ll be doing something you’ve never done before. I used to run a company that employed 200 people, but this is the first time in my life I’ve ever run a company that employed 600 and by the end of the year, we’ll probably exceed 1,000 people. And in a few years it’ll be 10,000 people. I’m terrified when I think about a thousand. Let alone 10,000. But on the other hand, I have fantastic people around me who tell me what we have to do to make this team efficient. What do we have to do to scale the company so that our processes work or to build a product. Konrad thinks all the time about what to do to build a product that will be used by 100,000 salons and in a few years a million salons.
It’s amazing to think that even you’re terrified when you think about those leaps you have to make. I think a lot of our founders feel that. I feel it too. It’s probably a common feeling. What would you say to a founder feeling that? Would you tell them “you can handle it”? I mean another founder who is feeling the same thing.
For me, I think the turning point was admitting to myself and telling myself that this won’t be the end of the world if I ever hand over the steering wheel to someone else. At the beginning of my journey in Booksy I had this belief that I have to take this company to the finish line. That I have to be the person who brings it to an IPO. Whatever this final stage or success is, I have to do it personally. A very liberating moment for me when I realized or freed myself from that trap that it has to be me. Telling myself that when I become the bottleneck and stop handling it then this company instead of succeeding will fail and I have to be ready to step down off the stage at the right time. And I think that was such a pivotal moment for me. Now every time I’m feeling down or feeling that I can’t handle something, I have a conversation with myself. Is this the moment? Do I feel like I have the strength to get out of this hole? Do I know for sure I will learn and retain the skills that will be needed in six months or even 12 months because I don’t even think about it in terms of the next five years. Breaking free of that really took all the pressure associated with clinging to the stool of being the CEO. No one will ever take away from me the fact that I’m the Co-Founder of Booksy. But if this company fails because of me it will be my greatest failure in life. So realizing that and kind of letting yourself know that “Ok, if I reach my limits as a manager, I should find someone who will be better than me, someone to take over the reins and lead this company to an even greater splendor and to even greater heights”. And I will always be the Co-Founder. I will always be the person who started this but also had the courage to admit to myself and to the whole world that this is where my role ends. I better put it into the hands of someone better.
You have a Co-Founder. Can you tell us a little bit about him? What do you really like about him? What does he do well? How does it work?
I have a Co-Founder, Konrad Howard, whom I knew before Booksy. For many years, we ran Sensi Soft together. That’s where we built our trust and formed our relationship. We also realized that we complemented each other nicely because Konrad’s specialty is the product and mine is everything else. Although, I also love talking and working on the product with Konrad. But I love the numbers, spreadsheets, models, strategies, etc. All the things you need to make a great product, put a spotlight on it and show it to the world. So, the world can see it and start using it. What’s cool about our relationship is that we often understand each other without words. I have this feeling that if for a year I didn’t talk to Konrad about the product nothing terrible would have happened. On the one hand, I know I bring some value to those conversations. But on the other hand, I also trust Konrad and I know he won’t let the product suffer. When we meet in a year, it will be an even better product than it is today. That’s probably the most important thing. When you have a co-founder and managers that you work with, you should choose them in such a way that you have absolute confidence in them. You need meetings, you need conversations because it always improves the work dynamic. On the other hand, if for a few weeks for one reason or another we are unable to meet with each other or talk about the product; because we’re all busy closing a round or releasing a new version; one will go on vacation then the other goes on vacation etc. and after three months, we’ll meet up and it’s the same mode between us as it was before the break.
I still have two quick questions that we ask all of our guests. One is, what have you learned in the last week?
I learned how many similarities there are between running a business and tennis because I read an article featuring a statement by Roger Federer who after losing his match yesterday to Hubert Hurkacz said that he feels so mentally exhausted that all he dreams about is going to bed. Emotionally, it took so much out of him that there was so much pressure and a lot of expectations that now he’s just dreaming about going to bed. Only in a few days will he start thinking about what to do next. It occurred to me that I’m kind of like a tennis player that’s on tour. When on tour they play a match every two weeks. And every two weeks I have a different task or some project, or making an important decision, or a round, or hiring someone. I’m going from task to task, from project to project. Sometimes when it lasts a few days, a few weeks or even this “match” can last a few months then every time afterwards, I just dream of going to bed. Having a few days to give my nervous system a rest. The big thing I’ve been thinking about lately is how to manage with your energy to keep up this pace. It’s something I realized this week that there are more similarities in sports and business than I previously thought.
That’s interesting. I was recently speaking with one of our founders that we have invested in in the last year and he’s been saying the same thing. That they, him and his partner, work so much now. They have calls non-stop in Poland, with the States at night. It costs them quite a lot in terms of health. And they’re wondering how to handle that in the long term. Because in the long term you have to manage that.
Maybe I will answer a little differently the question of what I learned. Because it wasn’t direct. But, I realized that even more important than time management is energy management. It isn’t always a question of whether I worked 5 hours or 15 hours. Sometimes, there are meetings or decisions that have to be made where the emotional cost is greater than working a whole week at 10 hours a day. Because I also have these marathons where I work too much all week. Monday at six in the morning I had a call with a team from another time zone — let’s put it that way so as not to spoil what country they’re in. I started that day at six in the morning I finished it at eight and I didn’t feel as tired as say yesterday after our board meeting. Again, it wasn’t a difficult board meeting. There weren’t any sensitive or difficult subjects, but the emotional cost of being ready. It is a bit like what Federer said yesterday that struck me. When this match is over, it doesn’t matter to him if he won or lost. He was in such a state of combat readiness to play the game until the end. Whether that end means losing the match or winning the final. You are just in a lot of tension up to a certain point. When it ends somewhat regardless of the outcome you decompress and there is this horrible exhaustion. It’s the same with us. We are making M&A deals where there are several weeks of intense negotiations. Fortunately for us, they always ended positively, but there will probably come a time where we don’t close the deal. Yesterday, I realized that maybe I’m gonna feel like Federer who said I don’t care if I win or lose, I’m glad it’s over. It’s that the emotional exhaustioni s so strong that when the air goes out that outcome doesn’t matter anymore.
I really like Brene Brown’s podcast. She talks a lot about stress, but she mostly talks about leadership and a part of that is stress. There’s a great podcast I’ll send you about how to handle it. She says that usually you have a situation that creates stress, but when it ends, you still have to kind of work through it. Different people have different methods. You might have sport as a way of working through it, but not always. You can have art-related stress relief. Drawing. It could also be crying. Different ways to work through stress once it’s over. This is also very, very important. And how do you rest?
Yesterday, I just went to bed. I was supposed to go for a run. I was supposed to meet with someone. But I canceled my run and my meeting and I just went to bed early. But I run a lot. I would separate stress from emotional cost, because sometimes it’s not that stressful in the usual sense. It doesn’t have to be some sort of bad or stressful thing. Sometimes there’s just stress that comes from the fact that it’s so important. Even if everything is going well and you’re winning these next matches in the tournament then you’re on such high alert. Even waiting between these matches, I imagine, is stressful or rather a large energy expenditure. Just like for me, for example, waiting between some meetings. We’ve given a term sheet and they’ll counter or they won’t. Maybe they’ll reject it. So it’s like even waiting between these successive interactions is a big emotional and energy expenditure.
Stefan, thanks a lot. I found it super interesting, super inspiring. I have to say I love talking to you. I always learn something new. Even though we talk a lot. The other day we were having coffee or lunch. I remember I went back to the office and told everyone, not everything, but certain things you said to me. You were super inspiring and today as well.
Thank you all for being with us. I hope the interview was valuable and interesting for you. If you enjoyed this conversation I recommend following us on YouTube, Spotify, and Apple Podcasts. Thank you all so much. Thank you very much Stefan who… still wants to add something.
Yes, I want to add something. Every time I watch YouTubers they say one thing “like and subscribe so the YouTube algorithm recommends our episodes to other people”. So I will say, like and subscribe so others can also watch some cool Inovo podcasts hosted by Tomek.
Thanks Stefan. All Inovo partners host them.
Inovo Venture Partners is a first-choice VC for ambitious founders from Poland and the CEE region. We back early-stage, post-traction startups with up to €3M of initial investment, and help them build global brands while driving growth of the local startup ecosystem. We take great pride in being close to top founders who think big. We’re investors in: Booksy, Restaumatic, Sotrender, Infermedica, Spacelift, Tidio, AI Clearing, Zowie, Jutro Medical, Intiaro, Packhelp, Preply, Eyerim, Allset, SunRoof and Archbee. Our second fund reached a total of €54M.
For more information visit: inovo.vc
