Episode 47
· 29:25
Everyone feels it. Even, like, repeat entrepreneurs when they launch something that people don't instantly want or understand. Everyone feels like a failure at this time. But I see people in the same situation and they bounce back. So that's also motivated me to, like, keep pushing.
Jack Bridger:Hi, everyone. You're listening to scaling dev tools, the show that investigates how dev tools go from 0 to 1. I am joined today by Anto, who is cofounder and CEO of Largo. And Largo is an open source usage based billing tool, that is really popular. I think Anto is probably gonna share some really cool update about how popular it is.
Jack Bridger:But thanks so much, Anto, for joining. Really excited to speak with you.
Anh-Tho:Thanks, Jack, for having me. I'm so excited. Yeah. I was just telling you, like, we launched on Hacker News 2 weeks ago, and I didn't realize it. But when I was writing, like, a new content for Lago, I looked at the past, like, launch during the past 12 months.
Anh-Tho:And it's, like, the most popular launch, like, for the past year. So we were, like, quite excited. I did a bit proud, I would say, because, like, you know, we pivoted 8 months ago. So everything LIGO everything you see about LIGO right now has 8 months. So we work really, really hard on this paper.
Anh-Tho:Yeah.
Jack Bridger:That is awesome. That's amazing. Yeah. So I guess, like, could you tell us a bit about Largo and, like, also following on, like how you kind of did so well?
Anh-Tho:Yeah, sure. So we're a team of, early employees of a Fintech unicorn called like Konto. For those who don't know about it, it's like, a massive, like, SMB Banking solution, like, $5,000,000,000 valuation. I was the 1st employee in VP Growth. I own revenue there.
Anh-Tho:And, like, most of the team, like, are early employees as well. So, like, we started in summer 21. We wanted to do 0 to 1 together. So it really, really relaxed and out from the team. And we like the same, like, areas, like b to b SaaS, Fintech, data.
Anh-Tho:For some reasons, we wanted to apply to Y Combinator and we didn't have a product. We got in. I had another idea of a product, so it was like no code versus ETL. Long story short, like we shipped during YC. We started monetizing what we learned.
Anh-Tho:We learned a lot of things, but I would say like, mainly like, three things. So the first thing is, it wasn't going to be a big market. Because we took the no code approach, like the wedge was to serve like marketers with data. What we learned and everything seems always obvious in hindsight, but what we learned is when a company grows, it's only the data engineering team or the engineering team that like, really do like data transformation, like in a, like, reliable way. So, but no code angle isn't really a wedge anymore.
Anh-Tho:So we needed to find another one. So that broke our, like, I was really, like, into no code at this time. So we felt, like, what we shift is great. Like, people are paying, but we're not sure it's gonna be a huge company. And as we were working, like, so hard, we felt, like, if we work so hard, we wanna show that being, like, big.
Anh-Tho:So we felt like maybe it's not the right angle. And also the second thing we learned was that, you know, we were synchronizing data from point A to point B. But we were not like producing any like important data that doesn't exist in another system. We were just like something like to transmit an existing data. So we felt like to be a massive company, what's important value chain might be like to produce a data that like, other systems don't have and want to connect to.
Anh-Tho:And that's also what made, like, a bit exciting to us in the sense that when everyone wants to be the hub, the source of truth of everything. But when you produce like this important data and over like tools or systems rely on it, then you're like the fact of the, the source of truth and the hub. So that's one thing we, we find like super exciting about billing. And the third thing is, that I forgot to mention was, is that when we started monetizing, we had a hybrid pricing. So subscription and monthly active rows.
Anh-Tho:And I really struggled with Stripe Billing to build that. And I know, like, our current team at Largo, they did, like, the homegrown billing system of, the previous Fintech, like, Conto, from day 1 to series D. And now, they're like more than a dozen like engineers, like maintaining this system. So quite naturally, I asked our engineers, hey, can you help me with like automating billing? Because like, it's a pain right now.
Anh-Tho:And they told me, yeah, Stripe Billing doesn't handle that. So we might like, rebuild it or at least, like, we build the data pipelines to send the the final result to Stripe. And we don't have time because, like, we're shipping products. So there's no there's no real solution. And so we bumped into, like, this billing issue again.
Anh-Tho:I think at the time we, we didn't like have so the conviction around, like, open source as the only solution to solve the, the billing, challenges, like, built over time. When we were at this previous company, we're always wondering why is billing such a pain point? Like so many companies like building their homegrown billing system. No engineer likes to write this code. And it's really hard to retain engineers, to have engineers who have experience on billing and to retain them.
Anh-Tho:So we really wonder like, is it like, why isn't it solved already? And like, our conclusion was that there's no solution, because each billing is specific. So you either, like, build it yourself, like we did, or you like, keep the things manual and you try to keep like, you know, the cost down. So you, you, you probably like export or like outsource this to some countries where like, where, where it's cheaper to do things manually. So that was the conclusion.
Anh-Tho:But as we were like, like, operating in like this first company around data and we were at YC, I think we've been like exposed to a lot of open source companies. And, like, slowly, but really strongly, we've built the conviction that we're like, wow. Maybe it's open source that's going to solve it because the situation doesn't make sense right now. And maybe you're wondering why open source changes it. When was the moment?
Anh-Tho:I'm not sure when was the moment. I think it was, like, progressive. But we felt, like, maybe open source, like, brings 3 things. The first thing is, like, it it builds trust faster with engineers. I think one of the things with billing is you have to build in a cave during 3 years and then you release a product that is complete and people can trust you.
Anh-Tho:I think we thought we didn't want to do this because like, it's very risky. Like the thing is like, you need to find product market fit. You really find out about like how your product is used when you have a product. So we wanted to ship as soon as possible. So as soon as we had something to show on GitHub, we just opened the repo.
Anh-Tho:So it took like 2 months, to build the 1st iteration of Flago and ship the alpha version. And we opened it, in June last year. The good thing with open sources, like you can, everything can be, can be in public, but, but when you build in public and open source, like people can look at your code and start like commencing it, it's awaiting it and build like trust around it. So in terms of time to adoption and time to trust, like it's much shorter. And also the second thing we, we like so much about open source is like extensibility.
Anh-Tho:So one thing is, people are rebuilding entire billing systems right now, because they have specific needs. But there are a lot of needs that are common to a lot of companies. So do you really need to rebuild like proration? Do you really need to handle dates, different time zones, coupons, credit notes? Like all these things are common to a lot of companies.
Anh-Tho:So what we're building with Lego is like a primitives that engineers can use and build on top of them. So, and because like it's open source, they can look under the hood and like more easily build on top of them. So they don't have to build like the common core, like billing system that everybody like needs. They just build the specificities. So that's also what, what open source brings to us.
Anh-Tho:And the first thing is scalability. So, like, as we can be used on prem. So we have an o Cloud version that can be used like as any Cloud version, like closed label or open source. And we also have an on prem version. And so that, like, people who wants to keep, like, control and like, scaled by infrastructure can do it, like, as they want.
Anh-Tho:They have a full control over it. So we felt like the the what open source brings to this specific issue is exactly what we didn't we we hadn't thought of it before and we wish we had, but, like, slowly, I don't know, like, how, but why a combination because we, like, we looked at a lot of business model, a lot of companies, like, it like, the conviction was really strong within the team, and that's how we, like, decided to pivot.
Jack Bridger:Yeah. Wow. That's, that's amazing to hear the journey
Anh-Tho:about it, like, how you
Jack Bridger:kinda got there. It's always the best exciting businesses that come out of, like, the pain point that you felt, and even the pivot was like you were experiencing it again.
Anh-Tho:Yeah. We knew about the pain, but we didn't find an approach that, like, really solved the pain. So we really we're really opinionated on the fact that no closed source SaaS is going to solve, like, billing. Like, the fact that during all these years, people continue to build, like, billing systems and don't like it is, like, shows that. So, yeah, we we really like a really different approach to solve this problem.
Anh-Tho:Yeah.
Jack Bridger:Yeah. And do you think that that is kind of was it the resonance that allowed, you know, your launch to be so popular? Do you think do you think that was the main reason?
Anh-Tho:I think, to be honest, I don't know. But,
Jack Bridger:It's hard.
Anh-Tho:You don't know. So I think
Jack Bridger:It works. I don't know why.
Anh-Tho:Yeah. Yeah. That's a good that's a good thing. I I think when it fails, like, it's easier to analyze why it failed. But when it works, sometimes you don't really know why.
Anh-Tho:But I think one fun fact maybe would be that in, like, around March, April, when we were, like, looking at billing, but without, like, the, like, big conviction that we were, like, going to do it, we were still, like, in the, like, pivot, like, trenches. My co founder wrote an article about, like, the title was Billing Systems Are Still A Nightmare For Engineers. And he just listed like, maybe like 7 or 9 pain points. And he posted it on Hacker News. It was his first post on Hacker News.
Anh-Tho:He barely knew like, what Hacker News was. He posted it there. And and then he went to have a beer. And and we felt like, you know, it's going to be the person that has one point and, like, never deceased. And then, like, it was, like, number 1 during 48 hours.
Anh-Tho:And we had, like, maybe, like, 300 or 400 comments. So I I I like to to bring him, like, in again and ask him, hey, have me, like, reply to the comments. And the the response was so, like, strong that we felt, like, it's really an unsolved problem. So we really need, like, to, like, investigate it more. So maybe that's what, that was like the first post that raised it, raised awareness about Largo.
Anh-Tho:We also kept the same name during the, during the pivot. So that has like pros and cons, but at least we have the continuity of the name. So we, I think we saw this like building awareness at, a bit like ahead. Also, we, we wrote a lot of content. So we wrote like maybe 60 plus, like more.
Anh-Tho:So maybe like 4 or 5, like, did well. So we went in a series of posts. So there was this first post super popular and then like, there was like the valley of death, like, of course. So we kept writing. There was a cat.
Anh-Tho:And we felt like, okay, maybe we got lucky once. Maybe it's not that big of a deal or things like that. But, I think we persisted. And, like, when we had like this, like, bunch of successful posts, we felt like, yeah. You just need to have a routine and, like, keep trying and keep pushing.
Anh-Tho:And at some point, it's normal that out of 60 posts, like, if 5 are really, really successful, maybe that's for ratio you should expect. And you you shouldn't expect, like, that every post is super successful. So that helped us as well, like, maybe be more, like, calm or, like, pose when we see a post that doesn't, like, succeed. We try to learn from it. It still hurts a bit, to be honest.
Anh-Tho:But, but, yeah. Maybe one message would be like, that's all the posts are going to be super successful. That's okay. You need, you need to keep pushing until you find 1 and try to replicate that. So, so, yeah.
Jack Bridger:Yeah. A 100%. I love that message. And I I like your what you mentioned off air about, like, what makes a good post.
Anh-Tho:I think you have,
Jack Bridger:like, a kind of a theory on it.
Anh-Tho:Yeah. So we we try, like, auto promotion. Like, I mean, it's obvious, but it doesn't work that way, especially on Hacker News. Like, you are going to be flagged straight away. Like, the the crowd there is, like, amazing, smart, a bit fierce about that auto promotion.
Anh-Tho:So I would try to avoid that. So we tried anyway, it didn't, didn't work. What works super well is, like, I think everyone knows about billing, knows that billing is a pain point. But there's a lack of, I think, a lack of, like, content that really explains, like, why or that really goes deep into the concepts. So we we now our angle is to write about, like, billing problems, how we solve them.
Anh-Tho:And also we spend a lot of time, like, explaining why it's a problem. Like, we've a lot of details. And there was a gap in the market for that. And I and I think these are, like, the most successful post. So I think that can be applied to a lot of, like, areas.
Anh-Tho:But yeah. Yeah. I I would just reconfirm that, auto promotion doesn't work on hyperthers.
Jack Bridger:Yeah. Yeah. Just explaining, like, you were talking about explaining really hard things. Doing hard things, explaining them in in a lot of detail, especially when it's missing, like you said, in billing.
Anh-Tho:Exactly.
Jack Bridger:Yeah. That's really, really cool. And one of the things that you've kind of also mentioned is this challenge where, like, a lot of the competitor for you is, like, people doing it themselves, in a way. And I'd love to hear, like, how you've been approaching that.
Anh-Tho:Yeah. So we one of the great things is we were this team that built everything ourselves. And so we're like the persona. I think when we opened the repo, we had, like, adoption from and demand for from later stage companies, like series c, series d, who build themselves and had a lot of pain points. So for some of them, we didn't have the whole feature set yet, but what we thought is like, there's a, a gap in the market for that.
Anh-Tho:Like these people are not going to go for closed source and they're, like, fed up with, like, building everything themselves. They don't want to hire additional engineers to handle that. So it co it confirmed our hypothesis. And also we were, like, fortunate enough to have a fit with, one company called, Lidya that, that's been more for Europe. They have 5,000,000 users.
Anh-Tho:So we see, and they were, like, looking for a solution like Largo. And, like, 2 months after we opened the repo, they inspected our code. They started doing pull request. And and and and yeah. And they chose like, so that that was really like, a good sign, a good signal for us.
Anh-Tho:And we felt like if, like, we're just starting and if, like, it resonates that much, then of course we need to, like, ship more things because, like, feeling a billing is complex. And then we we've been like working days nights at our shipping product to, like, reach future parity. But that confirmed the demand and the approach, like, very early on. And also we, we, we launched our first product and we didn't have the same like demand when we launched it, like the product we launched at YC. So we, we also served a difference, but there was like, that was a whole new, like, stage of demand.
Anh-Tho:So, so yeah. Like, yeah, we would try like several things and, well, that was a good, nonofficial launch. We're we're still in beta today. So yeah.
Jack Bridger:Yeah. That's amazing. And how have you, like, kind of when you get someone interested in the open source project, like, how do you think about the kind of transition from, like, someone that uses it, in an open source sense, and then someone that kind of brings it, becomes a customer, and that sort of stuff?
Anh-Tho:Yeah. So so we opened the repo 8 months ago, and we started testing monetization 3 months ago. We already have, like, users in production and paying users. I think right now it's so sometimes we have, like, people, like, signing up and just, like, testing everything themselves, and and they want to use a free product. And that's what I find.
Anh-Tho:And we were like really happy with that. And what we are like, we started selling and, it's early days, but really wanted to prove that people would pay, is like, a premium. So we have premium plans. It's basically open calls. So we have premium plans with like premium features, premium support and hosting.
Anh-Tho:You can, you can decide to have like the premium features and premium support without hosting. So on prem. So we sell, like, these premium plans. I think the conversation is very natural. They reach out we only handle inbound at the moment.
Anh-Tho:So they reach out on Slack, on Twitter, like, any, like, channel is good, and we have a conversation. And we have, we always try to help even if it's, even if they are using the free product. And sometimes, and we're grateful for the contributions as well. And sometimes they, they go from the free to the paying, like, really organically as well. So, yeah, I would say, like, for now, like, it's inbound demand and very organic, motion.
Anh-Tho:I'm wondering if it applies to other dev tools, but I think, like, billing, it's an existing need. So we are not like building an over like need, like it's been, like they need to build people. And also they're used to paying. So it's not like we're not creating a new use case and like they're not, they're wondering if they should pay for that. So maybe that makes that all very much more organic than for over, like, the app tools that might be in on this podcast.
Jack Bridger:Yeah. True. True. And I guess it's like the closer you are to, like, the revenue, it's kind of easier in a way to, like, you know, it's it's a percent on money you earn, I guess, I would imagine. Awesome.
Anh-Tho:Yeah. Actually, that's one of the thing where you hated when we looked at, bidding solutions. So we hated the fact that billing solutions took a cut on revenue, because we think it makes sense for payments because, like, your risk yeah. Yeah. You you work more if, like, you you make, like, more money, like, move from a place to another, there's more risk.
Anh-Tho:But for billing, it's actually a data challenge. It's a data solution. It's a SaaS. It's software. So so we yeah.
Anh-Tho:We we like, as any company, we are like, thinking of pricing every day and trying to find like what the fair point is. But one thing we we don't want to do is like take a cut on revenue. Because like that's, when we were like users of being solution or try to be users of external bidding solutions, we feel like that makes no sense and I hate it. It's like rent secure pricing. And we were also like, one of them, our successful person Hacker News was about like, Stripe that has like, they have 21 products and a lot I'm surprised because like, a lot of founders and like, brilliant people don't know about it.
Anh-Tho:So they have like 21 products. If you use Stripe, like, to get paid, you probably use 3 or 4 products. So you would do, like, Stripe Bidding, Stripe Payments, Stripe Invoicing, Stripe Data. And each has a different, like, pricing. And usually, it's a cut on revenue.
Anh-Tho:And, like, and the cuts on revenue add up. And it all affect people don't know about it. And, and there's also whole locking into this ecosystem. So for instance, if you use Stripe Billing, you can usually only use one payment processor. And unsurprisingly, it's Stripe payments.
Anh-Tho:So let's say you expand to Inza. Okay. But Stripe in Inza, but that's not the strongest payment processor you want to use, I don't know, Razorpay for instance. The strongest like payment processor there. You can't do it if you use Stripe Billing.
Anh-Tho:So there's also this like login that we, that we resented and that we wanted, like, to address and, and that we're addressing with Lago. So it's like open source, but also the philosophy is to be open to all the different, like, tools of the revenue stack.
Jack Bridger:Yeah. Well, it's like you're kind of like it's like someone asked chat GPT to come up with, like, the perfect hacker news company where you're like, you're open source. You're doing, like, really fast stuff. Like, it's payment solving a really hard problem. So, yeah, it's that's awesome.
Anh-Tho:I haven't tried tried GPT to write that yet. I should maybe, but I'm yeah. Yeah. I don't know.
Jack Bridger:It's amazing. Yeah.
Anh-Tho:People are already doing that, I guess. Yeah.
Jack Bridger:Yeah. Yeah. Because I guess, like, Stripe is so popular on, like, Hacker News on all their stuff, and then you're, like, even you're doing all the things, like, a lot more, like, in a way that developers appreciate.
Anh-Tho:Yeah. Actually, I think there's an inflection point on Stripe. If you look at, like, the person Stripe on how you can use that that a lot of, like, mixed feelings about them as well. So, you know, so, yeah, it's, like, mixed fitting at the moment. You know?
Jack Bridger:Percent increases and stuff like that.
Anh-Tho:Exactly. Yeah.
Jack Bridger:Yeah. That's really, really interesting. And, I guess, like, one kind of, like, more open question is, you know, you've had a lot of experiences. I know you do also, like, a lot of, like, angel investing and stuff like that. What is there any stuff that you think that is like a really big focus for you as a as a company, that you think is really important and the the best, you know, founders and dev tools are doing?
Anh-Tho:Oh, that's a bad question. I think one thing I learned by Android investing is you everyone has, so some people have all the stars aligned since the beginning. That's how you get, like, explosive explosive growth from, like, day 2. That's that happens to some people and that's great. And that means that they were smart, but that that hardworking.
Anh-Tho:That also means they were at the right time at the right moment. So they created luck at the right time at the right moment. But if you're not in this, like, 0 point, like, 00001 percent of people, that doesn't mean you won't succeed. And maybe the story of, like so my first angel investment was, like, hugging face. I'd be like, see it.
Anh-Tho:And it was like a b to c company, like an AI firm. Nobody understood that. I was like, we so my thesis was, the technology is amazing. And the second, like, thing I thought about was, so maybe with all this data, they can do something cool afterwards because, like, I don't know. Like, they can, like, make it anonymize it and, like, then, like, I know repackage it in a way that is, like, both, like, respectful of privacy.
Anh-Tho:And I don't know. Like, I don't know what I was thinking. But but the second, like, part of my thesis was wrong. So the first part about the technology was good. But they took like a few years to get to, to, to get to pivot, to B2B.
Anh-Tho:And I remember during the 1st years, like, nobody quite understood what they did. Like AI wasn't cool. They said like a very, very tiny and hardworking team, like a 5 people. I think it was, like I think they had a lot of fun working on that, but, like, nobody in this no. Very few people understood that.
Anh-Tho:And it was very inspiring to me to see how big it became now. How, like, people, like, really like it now. It's very popular. Like, they're like geniuses. I think they have always been geniuses, but at the time, like, they were like yeah.
Anh-Tho:People didn't get it. So it's really inspiring to me to see, like, these success stories as well. That's what I I was fortunate to like witness as well. So when we like launched our first product, it was a like massive growth and we felt like, I I was thinking it's okay. I've seen that and so people have come successful after that and sometimes they have not, but, like, I mean, it's part of a journey.
Anh-Tho:So it helps you as well, like, have perspective on that. It's still it still hurts, like, for sure. Like like, you you feel like a failure. Like, everyone feels it. Even, like, repeat entrepreneurs when they launch something that people don't instantly want or understand.
Anh-Tho:Everyone feels like a failure at this time. But I feel like I feel like absent it. Like, absent people in the same situation and they bounce back. So that's also motivated me to, like, keep pushing. So, yeah, I feel like that's one of main things, like, yeah, about, like, pivoting and finding product market fit.
Jack Bridger:Yeah. Yeah. That's really, really inspiring to hear. And, like, yeah, from hugging face as well as, like, a really amazing first investment.
Anh-Tho:It was a Tabakuchi. Like, imagine that. Like, and the NLP, like, technology wasn't as good as today. So yeah. Like, the it was, like, years ago.
Anh-Tho:So yeah. Like, it wasn't obvious. So and now, like, everything like, they look like obvious and stuff, but they persisted so much. I have so much respect for what they did that, you know. I think when you see, like, company at an at an early stage, that's exactly what I'm thinking about.
Anh-Tho:Maybe, like, are they going to persist until they find something?
Jack Bridger:Yeah. Yeah. Yeah. That's a really important point. Yeah.
Jack Bridger:Yeah. And so I think that's what we've got time for, unfortunately, because it's amazing. If you had one takeaway from the conversation, what would you think would be?
Anh-Tho:Yeah. Maybe about content because that's the main way people find us today, find Largo. So maybe the learnings were that, as I said, like, we posted, like, maybe like 60 posts and maybe 5 were successful. So I would say like, just like, have the right expectation of success for content is also a good way to not get like discouraged and just give up. Because like, it can be like a bit like depressing when you say that, but having the right expectation makes it like easier, like, to push through.
Anh-Tho:And I said that, maybe the second thing is like, we produce a lot of content, but at the beginning, we were like pretty bad at distributing it, like the right way, on the right channels and like, at the right time. And we also iterated on it. So I think also a lot of people produce content that like, don't think too much about distribution or maybe give up too early on a content that took, like, a lot of efforts to produce. So I'd say, like, maybe that's the second thing, like, we learned and we want to focus on as well.
Jack Bridger:Yeah. Yeah. Yeah. Amazing. Awesome.
Jack Bridger:Yeah. So, if people want to learn more about Largo or about yourself, where could they learn more?
Anh-Tho:On Twitter, we also, I mean, on the website, we are like everywhere. I can join our Slack. Like, yeah, we we will respond on any channel.
Jack Bridger:Okay. Amazing. Amazing. Well, I've gotta say like, yes. I'm really, really excited.
Jack Bridger:I feel like it's, I mean, it's such a huge huge opportunity in the space you're in and it's, I really love the approach. So really excited, thanks so much for joining.
Anh-Tho:Awesome, and thanks for having me.
Jack Bridger:And thanks everyone for listening. Bye bye.
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