Live from Bucharest - Elena Cârstoiu
Hello and welcome to the moon shots podcast.
It's an episode 24. It's huge. Its enormous 24 shows I can't believe it. I'm your co host, Mike Parsons. And as usual, I'm joined by the man himself. Chad Owen. Hey there, Mike. I am so excited to share this next batch of episodes with all of our listeners. Where in the world have we been recently? Oh my gosh. Oh my gosh. We went to Bucharest, Romania, and somewhere I frequent regularly. But you were there for the first time. What were your impressions of the fabulous city of Bucharest? Oh, I loved it. It was my first time in Eastern Europe. And I was just blown away by the people and the culture. And, dare I say the innovation I experienced firsthand while they're both doing some work, but also putting together a moonshots live broadcast in Bucharest. Yeah, it was, it was really great, really good energy. And, you know what, it was a very distinct flavor of entrepreneurialism of innovation. You know, Romania is a country it's been through a lot, and they're sort of in a brand new chapter of growth and emerging into this Western world. And I would have to say, the overall theme of the, the show where we had four different guests. It was resilience, resilience, resilience, wasn't it? Yeah, and grit. You know, another way of saying that, yeah, it was fascinating to me. Now, having done a live show, in Amsterdam, and in Bucharest and then doing, you know, a lot of work here in the States and in New York and San Francisco, how different each of the cities when it comes to the end and culture, but how they're all tackling it in their own unique style. And so that's just been really fun for me to see firsthand. Yeah, and I and I think what was so special about the full guests that we had on the show in Bucharest was each of them had like, really clear learnings and ideas that they wanted to share. And I think no one encapsulates that better than our first guest. Yeah, so yeah, like you said, we had we had four amazing guests from all different walks of life and entrepreneurial ventures in Romania and our first guest, Elena Cârstoiu, you cut her teeth in the Linux server web hosting and in kind of communications business, but, you know, she said that she was a little too early. And the only thing that makes you know, her company work was that she never gave up. Yeah, I mean, very strong learning. And in fact, they had to really Wait, I believe it was four or five years until actually the 2008 financial crisis struck. And that's when the business took off. Because they were such a cost effective new solution on the market that was finally what it took to explode business growth and to get on the way with hub gets their universal messaging platform and it was really a great story I mean they waited around four or five years before it really took off so she she came with that very strong idea and it's something we've seen in the show a lot Chad don't give up and sticking to it staying the path and soldiering on even when it feels really tough. Yeah, and her stories were so great. And I wish you know, you the listener could be there in the room, because everyone was just kind of actually listening to Elaine. I don't think we all expected to be like, dropped in So, so quickly into into learning from from her deep experience. Oh, yeah, yes. to her, right. She just like an out of the gates. She was a quick starter. She's not like Usain Bolt who takes a while to get going. She just came out bomb and hit us with the wisdom and everybody just thoroughly enjoyed it. And I think there's a lot we can take out of this theme of not giving up and staying the course. So what do you think Chad? Should we get into our interview with Elena? Yeah, in we will be publishing the remaining interviews from our moon. Just live broadcasts on an accelerated schedule. But let's go live to Bucharest and hear from Atlanta. I personally,
would you all please welcome Miss Elena.
Take a seat and get comfy. Now before we get into the serious to time found entrepreneurial story. Who's fresh off the plane from from Munich? Yeah. Yeah. from Frankfurt.
Okay. Until a trade show called Cloud fest. Okay. So with the team, of course, but the team is still coming just for you. You know,
wow, the expectations are building now what I would, what I would like to do is we're going to need your help on the show. We, as you might see here in front of you. We have some very famous Romanian treats. And if you watch the Amsterdam show, you will know that we went crazy for the Dutch treats. Chad had a little trouble speaking because he had so much licorice and also drop your the drop here. But we're going to ask for your recommendation because live on the show guys. It's about to happen. Chad is going to try he's first Romanian treats. Now I have to warn you. He's vegetarian. And I believe one of these may. Maybe this one has a little bit of something in it. But you've definitely got four choices there.
Okay. Okay. Any any of them? Because they are gorgeous. You know, but I try this. Try this. Okay. What's this one called? It's called chocolate.
Now let me help you. Let me help you with your with your Romanian is. We have we have maybe you can help us. We have not given so which one's the aggressor? Okay, that one's done it and then we have the solemn do
basically the salon the
Oh, that's that one. Looks like it's like dinner right there. Okay.
Cool vision. Which one was that one? Oh, that looks good.
And he took our because the other
hit the wheels.
looks. It's called Snow White. And they're all
the this is the snow white cake. Okay, chair. Which one is taking? You're taking your interest right now? Then. Then a good so. Okay. So he's a brownie man. All right. So let's talk about Elena. Now, what struck us so much about your history and your career was that somehow you've managed to found two companies back to back? Can you tell us a little bit about the journey of starting to doing two startups as a founder? I you not exhausted? No,
not at all. No, actually, I'm a co founder. I'm not a founder. You know, I founded the company together with my partner. And it's been a hell of a ride. It's been an enjoyable ride. But it's also is a difficult, right. So for anyone that thinks that having your own company or starting your own company, being an entrepreneur, being the founder is something very easy and enjoyable and doing whatever you want, because you're the boss. Well, I have some pretty nasty news doesn't go like that, okay. But this, this
is perfect. Because we really have this strong belief that it's great to be inspired by the stories of entrepreneurs. But it's equally important to really dig into the truth behind entrepreneurship, the the real things that it takes, in fact, we really tried to find practical wisdom from all the people that we study and trying to code. So tell us, what was the greatest challenge of these two companies that you've co founded? And what was the single greatest challenge and give us an insight into how you got through it, because you're alive and kicking your fresh off the airplane cat? So you're doing something, I think? Yeah,
well, I would say that the most difficult part in all this journey is that to not give up because, you know, I think there are a lot of urban myths, saying that, you know, it's nice to be a startup founder to start companies to do whatever you please, every day, you know, but they don't tell you how hard it is. And they don't tell you that it comes back with all those sorts of problems. You know, daily things, even when you start with little things, when you are at the beginning, you know, nothing can get straight from the first try, you have to try and try and try even harder until you get there. And this path of trying the even the path of innovating because you want to speak about innovation. Here it comes with hardship. And if you do not continue, even if it's when it's hard, if you do not continue, even when you just want to give up and go away. Even if you can stay there, you know, stick to your dream because you have a dream, right? You started the thing because you had a dream, okay. The Dream develops in time, it develops in many things, it doesn't remain in his first you know, inception in its first form, it evolves together with you and your company. But if you do not follow your path, no matter how hard it is, then you cannot consider yourself a founder, you cannot consider yourself an entrepreneur, you will fail, you have to go over failures over and over again, until you make it and you don't get to, you know, let the others tell you stop right now. So, just
keep going. So, how how, how did it get give us a sense of how, how close Did you get to quitting? Like, how tough how painful was it?
I think that any entrepreneur knows that you are quitting at least
per month. But you are getting back there, you know, No, I'm joking. It's not one time per month, it's I think, one time per year. I don't know, it depends. It depends on whatever, you know, the situations being, but I would say that, for example, we've started my burden. And I started in 2002, and we were developing software for managing servers, Linux servers, and at some point in time, in 2005, I think one of our biggest customer was coming to us to, you know, you know, discuss and see how he goes, what he needs more just, you know, checking the boss. And he was very affected by the fact that he wasn't able to develop his business more, he wanted to go into communications. And back then, in 2005, there was no solution, no actual solution for small providers. He was a small provider, he was not a carrier, his he was not, he was not Google. And all the solutions that were on the market were like millions of dollars. And he was very frustrated that even if she had a big hosting company would could not allow to go into another line of business and make more revenue because the market was closed, basically. And at that point in time, we realized that we have to do something about it, we just wanted to do it, you know, and we started investigating the market that we were totally unfamiliar with the communications market that was closed, you can even call it a monopole. You know, there were only a couple of big companies that was were selling very high, very high prices. And it was Cisco. I don't know, Microsoft wasn't back then. So pretty big companies. And I said, Okay, we can do this. I mean, we can help our existing customers going there as well, you know, not sticking around on this market, that it's pretty limited. And we started to do the thing, we developed our solution. Our first platform for unified communications back then was only Voice over IP, it's transformed in time you were
doing you were doing voiceover IP in 2006.
Yes. Wow. And not only that, we did do voiceover be in 2006, we did the first platform in the world that was able, that gives the ability for service providers to offer it hosted, you know, back then
assess, also Voice over IP, and assess,
yes, instant 2000s. Yeah. And, you know, back then, there was no such thing as cloud computing. Nobody call it cloud computing. But we offered it hosted that was the term you know, they didn't have the cloud computing thing that I think period in 2000, 10 nine or something like that. But it was the first platform in the world for that, of course, it was too early and people really did not understand I mean, we have with free listed in 2006. And for like, one year and a half or two years, it was very difficult to sell it because it was completely ahead of time. I mean, people had a very bad impression of voice over IP, because it was muddy it you know, they it didn't have a good restaurant was awful. But yeah, Skype was was awful. And you know what Skype has never been Voice over IP. Its peer to peer. Yeah, but people didn't know that. And they somehow in their back of their mind, they were making an equal between the two things that too,
so if you were too early, which is often a common mistake entrepreneurs make. Yeah, great idea. Fantastic. Take prototypes, technology, right? technology. We've heard about this a lot on the show. But then you come to the market, and you realize what you see as a service, some customers don't even know that they can buy. And so then you're faced with that terrible thing. You have to educate a market, you actually have to be a market maker. Yeah. And that can be difficult, very hard, very expensive. And I'm guessing this may have been a moment where you looked at your co founder and said, You know what?
Yeah, well, we were very lucky to have another line of business, because otherwise, I'm not sure exactly how it could have been, you know, the software that we were making for the server market kept us going. So we had this streams of revenue from there. Oh,
sure. But, but tell us when you're faced with this huge challenge that you're guaranteed to face. Whenever you try and do something bold and ambitious. Whenever you try and start a company you have for sure going to face these moments. The Valley of darkness is what it's called, How did you get through? What was the thing that got you through to the other side, like emotionally like for you? Like, what could you go back to, to regroup, to rebuild and to just wake up and then get back on the bike?
Well, I would say there are two things first, is that, you know, that first idea that get you started in our case, it was the idea that people were prohibited, basically, by the pricing to communicate better, even between our own in our own company, there was a problem, you know, we had a communication problem, and we couldn't solve it, because we didn't have the means. So we've built the means to communicate better. And we have never built products for end users. We always build products for companies business to business. So we always, you know, have have that image from even from our own company, you know, of what we need to build what we need to do to make our even our own life better. So we have this, you know, very strong, very passionate, very, I don't know how to call it very strong conviction. Yeah, mission that we need to do something. And if we do it for ourselves, let's do it for everybody. You know, let's make it happen for everybody. Yeah, and this, this is something that we've found across many of the other innovators we've profiled is they start with a problem that they themselves you always have was a problem. Yeah, you don't go from I want to be an integrated here. Pick me Pick me. I want to innovate. No, you don't do that. That's only I don't know, in San Francisco movies, or Hollywood movies made about San Francisco. Silicon Valley. Yeah, doesn't go like that. You know, it's, I have a problem. I have an idea of how I can fix it for myself, then see, I can fix it for everybody. Or for not everybody, but I don't know most people. Yeah. And then I start doing my thing, I start implementing my thing, I change it like 1000 times I change it again, and again. And again, then called innovation, by the way, and good,
is it still changing is important in perpetual change.
And then you get a moment when you're lucky. That was the second thing because I said two things. Well, the crisis came. And when the crisis came, everybody you're talking
Lehman Brothers? Yeah, that one, which was awful for everybody in in all the places in the world, and our customers were all over the world. So they had to try to reduce their costs. And our product was, you know, compared to other products was like infinity, less, you know, from the pricing perspective. So, they started, give it a try, they started to give it a try to voice over IP, which was, you know, reducing costs, not from the software perspective only, but also from the communications perspective as well. So they started to use it. And the user base I think, grew 100 times in a year
in 2008, 2009,
right after the crisis. Yeah, I think it began at the end of 2008. And it It had a three digit growth for like, two or three years. Wow,
yeah. So I asked you, do you think the sticking with it, and the not giving up by being resilient? Yes, we think in a way that and you that good fortune, and that lot, I mean, the
resilience was all about the crisis lunch, yeah, now, I think that things somehow connect, you know, not giving up gives you some opportunities, you take the opportunities you see beyond the line, you see beyond the, you know, US speaking here about innovation, the definition of innovation can be in two ways you can be an innovator by building completely new products or new technologies, right, that no one has built before. And this is a very expensive innovation, because it you know, you know, or you can take existing things existing technology and combine them in different ways, and create a completely different product, but with existing things, so I'm not sure if you if you know, Marc Andreessen,
Marc Andreessen, at some point in time, remember from his Netscape days, what he's Netscape CEO said, at some point, there are only two ways of making money by link and unbundling. And what he meant was actually, that you either do a thing from the beginning from scratch, and that's it, that's a new product, or you take existing products or existing things, you combine them in different way. And here you go, you have a different product, new product, nobody has a low and, you know, I think there is a very, very clear example that everybody knows Alexa. Right? So that's the perfect example about this thing. You know, voice recognition is on the market for many, many years. It wasn't that good. In the beginning, it started to get better at some point in time, the hardware improved again, because you need a lot of hardware, computational power to be able to do voice recognition. Siri came out, right? We all had serious annoying, I have a close because it drives me nuts. But what Amazon did, they took the voice recognition and they put it in a speaker, nobody did that. Okay, nobody did that. They took the risk. Because actually, that's another thing about innovation. You have to take risks, yes. When, you know, doing something new, whatever, it doesn't matter how you do it, if it's new completely, or you know,
bundling, bundling are all going to have risk and
Exactly, exactly. So innovators takes risks. And if they take risk, you know, they will eventually and stick with it
yet, right. Yeah, yeah. Now, what's really interesting for the audience to know is that Elena has quite a lot of, shall we say, a deep practice in really working on the internal operations, the efficiency and the people within your team. And so we would love to hear some of your thoughts on as you go on a journey before the 2008 crisis, through the crisis. And then after through two different companies, you must see an enormous amount about how people work and what it takes to build a team to finally succeed at the end of that journey. What advice would you have for anyone here in the audience, or any of the viewers online today? What What advice would you have for them about how to build teams? And what does it take? What does it really take to build great culture and to bring people together?
Well, I think the most important thing, I mean, there are hundreds of things I can go on here, like four hours, we extend the show, it's okay. You don't want to hear my voice?
I'm just joking. No, I think the most important thing it's communication communication with the team members, because without having, you know, by now, everybody talks about collaboration, you know, everybody's, you know, Slack, everybody on the internet. And everybody's talking how collaboration is great, but they forget something, you cannot collaborate with other people, people without communicating with them. So, communication is actually collaboration, the collaboration is the, the result of the communication process. So if you don't do the communication process, well, if you don't do it efficiently, if you are not productive in your communication, if you don't find out information, if you don't spare that information, if you don't store it, right. So you can find it at any time in any moment in time, then you will have a problem later on with your own people. So I think that the most important thing in our culture, even in a company culture is its communication ability and its productivity in terms of communication. And at the end of the day, it will be the productivity of the team.
What what kind of practices have you seen work inside of have guts to foster good communication?
Well, this is how we, this is how we actually built how gets because having this experience in voiceover I've been,
and we have seen with our customers, and even with ourselves that at some point in time communication started to own us, you know, yeah, it's like, you have a phone rings all the time. By el Ey, you are buried in emails. You you have that I don't know how to say, I'm not sure if I can use that word idiotic, need to answer every email that you get in the in zero inbox. stupid thing, actually. Yeah. And now you have smartphones, and you have notifications that are popping, you know, popping all the time, you know what I mean, right. And at that point in time, we realized that we need to do something about it and do it smart, because otherwise, the communication will own us and not the other way around. And this is how we started to build hub gets, we wanted a product first for our cells. And then for everybody else that put the people first.
And what does that look like putting the people first?
Well, in our case, it meant building an artificial intelligence layer that controls the communication, meaning that it actually doesn't allow the communication to, you know, come to, to disturb, you know, it uses some, of course, some data from the communication that you do, and it makes it a more streamlined, more efficient doesn't disturb you filtering and reducing Yes,
the first step, yeah,
yes. And not only that, it filters and reduces it, it also we have noticed that that when people are less disturbed, they become more happy. And when they are more happy, they become more productive. I mean, we have worked to the center artificial intelligence layer for many years. And we have traded with a lot of data because, you know, in artificial intelligence, you need a lot of data to really have, you know, actual results to have to find the
Yeah, exactly. Find the patterns, you have to feed them the data to the algorithms, you know, have to machine learning to go to the gym. Exactly. Put them to some push ups. Yeah. And after making a lot of push ups, you draw some lines, and you reach to some conclusions. And we found out some very interesting facts. Like, I can give you some If you want, I have one, a couple of them from our sales presentation at cloud first, it was a I will give you just two and you tell me if you don't find them amazingly interesting.
And what example are you looking that up? So the idea talking about is I really liked the idea that communication,
let me just tell you did you know that a happy person requires six to 10 interruptions in 90 minutes to get annoyed.
six to 10 interruptions in 90 minutes together night or if you want to annoy a person you have three times more chances between three o'clock in the afternoon and 445 in the afternoon.
Now why do you think that is because they're they're on the deadline trying to get everything out for the end of the day at
that's the explanation I don't know. I only have the facts
Well, I know some people we could ask if we wanted to get some insights about these so I think we're at a point where we want to now send chat into you and so you have to stay here with me because we won't you guys Chad does come a wondering and what we really want to ask of you is what have you what insights Have you come to thanks to thanks to Elena certainly love this idea of survival, resilience, sticking with it. I love the most important Yeah. And, and staying with it. And it's much harder work than what you may expect that there was plenty of other thoughts. I love this idea of like, if you want your coworker to be happy, like stop interrupting. I think this is really, really valid
and dream for everybody, you know, do their job. And, you know, and don't, you know, there's another hype, think the fear of missing out, yeah, okay. No fear of missing out because you have everything there. So, you know, bounce you always have to find a balance even as an entrepreneur or an innovator you always have to find the balance you know the balance between taking decision making you know taking risks and getting there no matter what
right okay. Bucharest we're sending chat in the audience who has an insight who has a learning to share we've just listened to a liner espousing wisdom and I can see that the minds are moving I don't quite see smoke signals yet who's got something that they would want someone else yeah I'm this little bright people in the front Chad I reckon you could proposition one of them for for an insert this gentleman here he now he's looking July. Let's see if this gentleman has a thought for us.
Your favorite your favorite insider learning My name is Flavio.
What I found quite interesting was on the first story, because usually criticism that you get a lot about innovation and engineers is they are very good on creating solutions. And then trying to find the problem that their solution is solely solving. But actually from a business standpoint of what you have done was finding a solution to an actual problem. But then, and this is the business part of it, then you have to have the right moment where the inverse gets aware of the same problem. Yeah, indeed. So basically, you came from a small company, you had an issue with the costs and all this stuff. But you had to have a crisis where everybody went down and suddenly the headless in Pakistan, otherwise they wouldn't have cared.
Yeah, exactly. Otherwise, for us, it would have been impossible as a small company, of course, to, you know, educate them, you know, we had the crisis educating them for this purpose. And we kind of use that
to know what a great constraint I hope you create a market I think that's really interesting. You know,
I think that the crisis also helps in other, you know, ways, you know, when people are in their comfort zone, they don't get to innovate very much. Usually cold showers
are good, yeah,
why innovating, when it's so nice, you know, yeah. So, when you are under pressure, then you get to do things, you know, move faster, we solve problems. You know,
this is a great insight. I want to let's see if we can Roman who who's into communication, who's someone smart that maybe learn something from community wonder down that aisle so you can find some bright book or St. Pete, you look like you are paying attention. Yeah, yeah. Yeah, this guy
favorite insider learning around communication. Yeah, thank you very much. You're here. My name is George. I'm also an entrepreneur, I'm running my company. And I do enjoy hearing the stories about not giving up. This is what I really appreciate, because I know how much energy and how much effort is behind this. Thank you for your story. Thank you so much. I don't go encourage everyone to not give up. Never. If you have a dream, just walk the path.
Yeah, very widespread. It's in fact, Paul Graham in in Silicon Valley has. He's one of the best investors. He's one of the founders of Y Combinator. And he actually says, survival is success for startups. survival is success. And in your case, the success came when those a huge change in the marketplace and it was very telling and you stuck it up for how many years?
Well, we are on the market since 2002. Yeah. Wow. celebrated 1616 years. Last month with the team. We had a pretty wild fire.
So lifetime. It's incredible. It's wonderful. Any last thoughts before we go to our next guest? Anyone else? Got some great thoughts to share? There's a very, very bright gentleman down here in the suit. He might have some thoughts about not giving up and communication within large organizations, huh?
Yeah, thank you. My name is our early I'm
actually at the time when Voice over IP was somehow restricted by the operators. Your idea was bright one, and I want to congratulate you for that.
Thanks so much.
Wonderful. What a nice way to end up our time with it. Would you all please give it up?
Thank you. Thank you.
Well, there you have it. Mike. So many learnings from our live show in Bucharest. Absolutely. I couldn't agree more. So on that note, Chad, I want to thank you. I want to thank all of our listeners. It's been great having you on board for the journey so far, and there's plenty more to come. So take care everyone
And I think that brings us to the end of the show. That's
Transcribed by https://otter.ai