EVERY SPOKEN WORD
35 min read · 7,159 words- 0:00 – 1:10
Intro
- GAGustaf Alströmer
[upbeat music] Today I'm joined by Sam Ross from Numeral. Uh, me and Sam worked together at Airbnb, and Sam started, uh, Numeral in 2023 and did the Winter '23 batch. I'm excited to have him here. Welcome.
- SRSam Ross
Thanks for having me.
- GAGustaf Alströmer
I remember when you first told me about Numeral and you had the whole thing figured out.
- SRSam Ross
[laughs]
- GAGustaf Alströmer
And it hasn't changed very much until now. It's basically the s- the same, the same plan. You were uniquely positioned to figure out this plan. Like, how did you know that sales tax, specifically for e-commerce in the beginning, was a big problem?
- SRSam Ross
Yeah. I think a lot of founders have this, like, hero's journey of pivoting through the batch and hitting their head against the wall, and then finally finding something. For us it was very boring and, like, linear. We c- we... You know, I think I had known I wanted to do a startup for, for a whi- for, for a while, but, you know, I really took my time to f- you know, until I, um, really landed on an idea that I had a ton of conviction on. And so it wasn't this... You know, I didn't feel like I was forcing myself into, to, to starting something. So I think that helped. My background before this is, um, I'd been running bootstrap e-commerce businesses. And so, you know, I ran a jewelry business that did 30-plus million in sales and have a... I
- 1:10 – 3:20
From Bootstrapped E-Commerce to Startup Idea
- SRSam Ross
still own a vitamin gummy shop that does north of 10 million a year. And, you know, as a bootstrap founder, you kind of have to do everything yourself. You know, you don't have a big team you can delegate all the work to. And so the thing I hated doing the most was this very esoteric thing of sales tax compliance, where my small businesses, which were, you know, two, three-person teams, were having to pay and file and pay taxes in 40-odd states in the US. And so I was personally dealing with Department of Revenue, Alabama, West Virginia, getting mail from these states.
- GAGustaf Alströmer
Like, manually, you were like... Like, what happened?
- SRSam Ross
We, we used some software.
- GAGustaf Alströmer
Okay.
- SRSam Ross
So yeah, you, what you have to do if you're e-commerce, in, in, in SaaS business as well, as you get to a certain scale, is yes, you, you know, as a customer orders from you, sales tax i- is, is governed by local jurisdictions and states, and so you're not dealing with the IRS. You actually have to make sure on an order you're collecting the right tax rates and, and, uh, remitting it to these different states. You know, I used some, this, the incumbent software, which I had a... I can talk about that, but I had a horrible experience. So that would really inform my decision here was the incumbent software was so bad. Yeah, I was filing taxes in West Virginia. I was on the phone with w- like Department of Revenue, West Virginia. I get in an argument with some woman there about some penalty waiver she needed to give me.
- GAGustaf Alströmer
Did everyone have to do this? Like, everyone who's, does an e-commerce business basically had to do this?
- SRSam Ross
Yeah. As you get to a certain scale, everyone has to do it. So it wasn't a problem histor- you know, in the past when I was starting my businesses, you know, in 2017, I only had to worry about sales tax in, uh, California, where I was based. But there was a Supreme Court decision late 2018 that changed the, changed the rules, and after that, even if you don't have employees or you don't have a presence in a state, if you sell a certain, um, amount of dollars into the state, that's when you have to register. So if you sell, you know, $100,000 or 200 orders into the state of Illinois, now you're liable to go and, and pay taxes there. And it's very complex. So in, in Illinois, software is actually tax-exempt, so you don't have to worry about it. But guess what? The city of Chicago has their own rules, and you sell X dollars into Chicago, and you actually have to register with Chicago itself. And so there's all this, you know, very specific c- um, complexity. And as a founder, it was literally the last thing I wanted to spend time on, right? It wasn't growing my business. It wasn't giving, it wasn't giving me energy calling these states. And
- 3:20 – 5:15
The Supreme Court Ruling That Changed Everything
- SRSam Ross
the leading software in the market was from the early 2000s, was really almost... Doing, going through the sales process even was like a hostile experience it felt like. There were a lot of fear tactics. Yeah.
- GAGustaf Alströmer
Why were those other softwares so bad?
- SRSam Ross
So I think a couple things. I think one is they were designed in a period before the Supreme Court decision, and so they weren't really designed for SMBs.
- GAGustaf Alströmer
Mm.
- SRSam Ross
They were really designed for, like, up-market businesses. And I think they're also-
- GAGustaf Alströmer
Charging enterprises maybe. Uh, charging enterprise cost maybe.
- SRSam Ross
Exactly. They're focu- like, they were building for, you know, these big corporate controllers.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
And the software was designed in the early 2000s, so there's a sort of like a, a moment, maybe like 2011, 2012, where you're starting to shift in terms of, like, the qu- how software is built. But I think if it, if it was built before this era, these things are built on .NET, and, and just the user experience, like there's just, like the UX patterns don't really make sense, the last 100 figured out.
- GAGustaf Alströmer
Mm.
- SRSam Ross
And so this c- the biggest competition, this company who we compete with called Avalara. They're owned by private equity. They just aren't really building software in a way you, you would in 2025. So a lot of the things that we've had that have given us success, it's not necessarily like groundbreaking innovation. It's, it's like taking the stuff and, like, delivering what you'd expect from high-quality software, and, and, and just, like, customer support and all these basic functions. We do it well. Often you can just win on fundamentals.
- GAGustaf Alströmer
Mm. And you're, you're one of the fastest growing companies since the 2023 NYC. Um, would you say this is sort of like the market is accelerating at the same time, like more people need this, and you got, have really good software compared to competitors? Like, what would you attribute to sort of like the growth?
- SRSam Ross
Yeah, good question. So I think, yeah, the market's grow- you always want to be selling to a growing market. And then I think on ours too, we just got-You know, frankly lucky that, yeah, the, that was, you know, one big commission was gonna be Avalara. There was another one in our space called TaxJar. It was acquired by Stripe, and Stripe decided not to, you know, just own, you know, or practically sunset the product.
- GAGustaf Alströmer
Mm-hmm.
- SRSam Ross
And so sometimes you get lucky where, yeah, I think it's a common pattern
- 5:15 – 7:00
Why Existing Tax Software Failed
- SRSam Ross
where the big players in the market get acquired-
- GAGustaf Alströmer
Mm
- SRSam Ross
... and then they just to- totally stop innovating. They cut costs, they stop investing and even go-to-market functions, things like this, and that creates an, an opening for you to innovate.
- GAGustaf Alströmer
Your first two companies or couple companies were successful, like, like by, by any standard, like that's a great, great, um, result. However, this company, I think you had a different ambition-
- SRSam Ross
Yeah
- GAGustaf Alströmer
... than those two companies. Tell us about that. And you told me very specifically about that the, the first time we met.
- SRSam Ross
So, you know, my background is, you know, we used to work together at Airbnb.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
And at a certain point, I was like burnt out of San Francisco, and I'm like, "I wanna just..." Uh, I got out of like a five-year [laughs] relationship, and I was like, "I just wanna like travel the world." Um, but to do that, this is 2017, I, you c- you know, there wasn't a lot of jobs that were gonna hire me living in Tokyo or Rome, Italy, or somewhere like that. And so I needed a way to pay, pay the bills, and so I saw the opportunity. You know, direct-to-consumer businesses were, were coming, were b- becoming a thing at the time, and I saw that you could build these businesses bootstrapped, and so that meant I wouldn't have to report to anyone. I didn't have a boss. I could kinda work on my own schedule.
- GAGustaf Alströmer
Mm-hmm.
- SRSam Ross
And so, you know, I ran this for a few years. I think i- i- the, very, like these kinda cashflow positive businesses, but the challenge for me always was, you know, and a lot of these direct-to-consumer businesses, that you don't have the same retention that you would, would have in, in many like B2B or enterprise ty- type, type of businesses. And so I had one business that like had a hu- you know, we did tons of sales very quickly, a fast rise, and then a fast demise because there wa- there was no retention. And so that always gave me some anxiety that even if I was making a lot of like short-term cash, like this could always go to zero any day. And so I had a period where I met my now current wife, and I was like, "I need to do, I need to build something," we were just like house shopping and thinking about children. I'm like, "I need to build something more durable." In the same time too, I miss building software, and I wanted the challenge of building something, something bigger. I think I w- I was, I was ready
- 7:00 – 9:10
Building on Fundamentals, Not Fear Tactics
- SRSam Ross
for it.
- GAGustaf Alströmer
Mm-hmm.
- SRSam Ross
I think it's interesting, though, comparing you have, I had the experience building businesses that are bootstrapped, and you build in a certain way. You have to be very scrappy. So it's really hard on those dimensions, but on the other dimensions, you know, you actually, you don't necessarily need to get to huge scale. Like the t- the, you know, the total addressa-market, addressable market you go after doesn't necessarily have to be huge-
- GAGustaf Alströmer
Yeah
- SRSam Ross
... because, uh, you don't have investors. You don't, you don't necessarily need to become a public company. Whereas, if you're building a venture-backed business, the expectation is you can build, you know, a $10 billion plus business, and so you're always having to make sure, "Is my market big enough?" The, the, the pressure is, is much higher.
- GAGustaf Alströmer
Mm-hmm. It was, it sounded like it was a very intentional decision. A lot, probably a lot of people watching this, they build something that's more of a lifestyle business, and then they're like, "I'm thinking I should do something that is much more ambitious." Like it sounds like for you it was like a intentional moment for like-
- SRSam Ross
Mm
- GAGustaf Alströmer
... yes, this is what I wanna do.
- SRSam Ross
Yeah, exactly. You know, I had thought about starting, um, a s- a s- a venture-backed startup earlier in my career.
- GAGustaf Alströmer
Mm.
- SRSam Ross
But my first startup I was, I worked at was this company Teespring, which had phenomenal rise and like phenomenal downfall. And I think I saw how real- it was really hard for the founders there. And so it kinda gave me a little anxiety to go and do the venture route 'cause I knew it was high pressure. And so for me, I almost think of it almost like a marriage in some ways. And, you know, it's like, "Okay, I'm gonna commit to this." Maybe not your c- I guess a marriage is for life. This is maybe for like 15, 20 years. But it, it, it's, it... You really wanna make sure you have conviction. You don't have other things in your life that you want. It kinda forces you to l- even like decision of where you live. Like I've met many founders, like they don't wanna live in San Francisco anymore, but they can't, they, they can't li- they can't leave because they're the CEO.
- GAGustaf Alströmer
Right.
- SRSam Ross
Their business is based there. So you really have to just make sure you're committed to, to it.
- GAGustaf Alströmer
What did you have on the first day of YC?
- SRSam Ross
We had very little. We had no software. Um, probably almost no customers. You know, our business, we're doing sales tax compliance. You know, we could execute in, i- in a way that was very, um, do things that don't scale, and just, you know, "Hey, I'll go file someone's taxes by hand."
- GAGustaf Alströmer
'Cause you'd done it before. You know what to do.
- SRSam Ross
Yeah, I'd done it before. We actually didn't necessarily know what to do, but we figured it out on the fly. So, you know, we went and sold a couple friends. Said like, "Hey, we can do your t- sales taxes for you." And we're like, "Oh, shoot, how do we actually do this," you know? We had to call e- so we had to like go and, um, you know, my co-founder's like calling up, I think it's like Remember DC, he was like on the phone.
- 9:10 – 11:20
From Filing by Hand to Serving First Customers
- SRSam Ross
And, "How do I file the taxes here?" And so we were just figuring it out on the fly. So a lot of it was just, you know, sell, sell what we didn't, sell something we didn't even have yet. Figure it out on the fly. We, in our case, we were lucky. We could go and use Excel, and you didn't need software. We didn't even have a dashboard until we had something like 20 plus customers. So I can go back and find all these early emails of mine where I'm like, "Oh, we're refactoring our dashboard. Don't worry, it's coming out soon," like. But the, um, the advantage we had is we actually had a lot of customer growth compared to a lot of other startups, which were building really interesting software but didn't have anyone that was actually using it. So it was sort of like a very demand-first, um, approach versus like a software, um, supply first.
- GAGustaf Alströmer
How did you figure out how to sell to the first 20 people? I, you said friends was the first one.
- SRSam Ross
Yes.
- GAGustaf Alströmer
How after that?
- SRSam Ross
Yeah, so started with friends. We tried to use our network and, you know, that ran out pretty, pretty-
- GAGustaf Alströmer
Yeah
- SRSam Ross
... really quickly. I remember like I would try some cold emailing. It'd work r- really well for a couple days, but I didn't know how to do it right. So then everything started going into spam, and it, big jumps in growth, and then all of a sudden like weeks where we couldn't figure it out because there was all this like tactical knowledge that I, I didn't have yet.
- GAGustaf Alströmer
How do you think the batch, the YC batch Winter 23 shaped the company and maybe shaped you in a way?
- SRSam Ross
When you j- when you go to YC, you're just around like some of the most ambitious people on earth. And so again, I had come from a background doing bootstrapped businesses. We initially incorporated Numeral as like an S corp, meaning like we weren't even sure if we wanted to take investors. Maybe we'll like build a bootstrapped business here. You know, everyone's trying to, has way higher ambitions than you, and you realize like, "Wow, maybe I'm just being like small brain here." And, you know, you have this kind of imposter syndrome. Like there's nothing really stopping you from building a really big business. It's not that like a lot of these other CEOs are, are more talented or, or, or are smarter. They're just more ambitious and like willing to, willing to take bigger swings. And so I think being around that culture, um, for me was really helpful.
- GAGustaf Alströmer
Tell us about fundraising. Uh, I remember being on a bunch of calls with you at the end of, end of the batch, and you were fundraising. Had you fundraised before?
- SRSam Ross
I'd never fundraised before.
- GAGustaf Alströmer
Uh, I know the, the fu- YC funding is different than-
- SRSam Ross
Yes
- GAGustaf Alströmer
... other fundraising, but like what are some learnings you have from fundraising early on? Or maybe like expectations that you had that turned to be true or not true?
- SRSam Ross
Yeah, good question. So I think we had, we had really good traction, um, at the start. And so we had... K- came in with expectations like, "Wow, we're gonna get, like, the fanciest firms, and it's just gonna be, like, overloaded with term sheets
- 11:20 – 13:30
Lessons from YC W23 and Early Growth
- SRSam Ross
or, or, or safes." And I think we ended up, it ended up working out well. We got a lot of offers, but it was, it was certainly... You know, I had to take hundreds of calls in something like a three or four-week period.
- GAGustaf Alströmer
And lots of nos.
- SRSam Ross
A t- most, like 95% nos, right? And so I think, you know, rejection is something that I think humans are just, like, maladapted for, and it's like it, it really gets to you. At that point, it was, it was, like, kind of p- post-COVID, so I was still wor- I was working in my shed, and I, I, I had like a... my gym set up, and I was just sitting on, like, my gym mats, just, like, staring off into space for, like, 30 minutes. You know, I was just so defeated. 'Cause I think it's hard, too. You know, I'd take, like, seven or eight, uh, pitches in a day, and then I'd go eat some dinner. And then my, my actual work started. You know, I had to go, like-
- GAGustaf Alströmer
Yeah
- SRSam Ross
... talk to customers and fulfill our product, like, starting at, like, 7:00, 8:00 PM. You, you have to just understand, like, what are the investors looking at? What are their incentives? How are they... You really have to wanna get inside their brain. I think I probably didn't necessarily understand how they think well enough, and maybe there were some misconceptions there. You think coming in, "Hey, I have this fast growth," like, "Hey, the, the data's gonna speak for itself."
- GAGustaf Alströmer
Mm.
- SRSam Ross
But early stages, the data doesn't really mean... They don't care about... No one really cares about the data. I mean, try- maybe it's consumer app traction things help.
- GAGustaf Alströmer
Mm.
- SRSam Ross
But at the seed stage, it's really about the team, the market, and things like this more so than, than your traction. I thought I could rely on my traction more.
- GAGustaf Alströmer
And for people listening here who are, like, fundraising, got a bunch of nos, like, how, how do you not get discouraged and give up?
- SRSam Ross
It's always gonna be stressful and hard, and so I think you just... Everyone need, you know, some people it's, it's... Like, for me, I do running. If I can find sauna, it's sauna. It's, you know, it's just, like, this stuff that's, uh, the self-help stuff. And, you know, I think it's, it's easy to, like, uh, laugh about it or, or think it's, like, some low-status thing to talk about.
- GAGustaf Alströmer
Mm-hmm.
- SRSam Ross
But in reality, if you don't do that and you're just working yourself, like, you're just gon- you're gonna get some level of burnout or, or exhaustion. And, you know, there's a lot of p- people talk about crunching or they work in, you know, crazy hours. And I think ultimately this thing is a marathon, and, like, really what wins is just consistency.
- GAGustaf Alströmer
Mm.
- SRSam Ross
Consistency of practice and, like, can you out... You know, I think working crazy hard for, like, two years is probably much worse than working slightly less hard but doing it for 10 years, right? These things compound.
- GAGustaf Alströmer
Mm.
- SRSam Ross
And so I think you have to just find what's sustainable for you.
- GAGustaf Alströmer
One thing I'm always curious about with,
- 13:30 – 16:20
The Grind of Fundraising and Facing Rejection
- GAGustaf Alströmer
uh, YC companies is as they grow and... How, how big is your company now?
- SRSam Ross
Uh, we're about 60 folks.
- GAGustaf Alströmer
60 folks. So how do you, uh, how do you stay in touch with customers? Like, how do you specifically don't lose track of what they think about the product or think about the company?
- SRSam Ross
It's always a battle.
- GAGustaf Alströmer
Mm.
- SRSam Ross
Um, for me there's a couple things. I think one is, you know, I can t- I'm always trying to jump on sales calls where I can. So, you know, whether it's a direct intro to... Like, o- often they'll get a direct intro to me. Or even yesterday I was talking to a team here who I saw they booked a demo, and you know, I didn't have to jump on the call, but I'm like, "Oh, I, like, I like this YC company. Let me just join." And so it's always, I think, just helpful to either be on sales calls, or we use Gong. Like, actually spend time watching Gong recordings. We'll often just log into Intercom, which we use for CX, and you just go and read some tickets, and it's, it's really insightful. So I'm not necessarily directly conversing, but I can see what they're writing in. Um, and then invariably, you know, when things go wrong, like, customers are gonna email you as the CEO, "What's going on?" And so, you know, I think I always invite customers that are angry. Like, "Please..." I, I'm like, "Thank you so much for emailing me. I'd much rather you email me and, like, I can solve this problem for you than just, like, go to CX and I miss it." But yeah, it's always a challenge, I think staying close to customers, and, you know, you don't... It's, it's always super important. You want, you wanna have that empathy is really important.
- GAGustaf Alströmer
You had the idea from a personal experience. So you, you experienced a problem. You're like, "This is a company I'm gonna go out and build." Like, that doesn't necessarily mean you have product-market fit. Uh, just those two things. You had to, like, get the validation from customers, or customers have to... Like, there, there's probably a moment where you're like, "Okay, now I know enough about people that have the same problem." Like, when would you say that you're like, "Okay, I know this is gonna work. Let's build, build something big"?
- SRSam Ross
The biggest thing for me finding product-market fit, I think especially consumer you get a lot more data, is like-
- GAGustaf Alströmer
Yeah
- SRSam Ross
... it's not like when people tell you that they'll use it. It's like, will they actually, like, give you their credit card and give you their money? And so bef- you know, before we applied to YC, we had people who were, like, willing to give us their money, and then we're like, "Oh, actually, we actually need a few more months." And so, but you wanna make sure someone's, like, not just gonna, like, test it. They're actually gonna... I mean, not all cases, but for many pieces of software you wanna make sure they'll actually pay for it.
- GAGustaf Alströmer
Mm-hmm.
- SRSam Ross
And so I think for me it was like, "Wow, people will actually, like, pay for something that's thousands of dollars a month." The other thing that sh- we saw product-market fit is every time we layered on a new go-to-market channel, whether it was, you know, something like Google Ads or it was, yeah, like posting on social media, like, each, each incremental thing that we added, like, worked to a degree, a pretty good degree. And so I think that's how we knew we had product-market fit. It wasn't like, "Oh, we just figured out how to mine customers this way, and this, but it won't last very long." It was kinda everything that we layered on. And, like, things, we would try different go-to-market tactics we didn't even think that we had. We're like, "This, no, this won't work." And when it does, you're like, "Wow, that, that's how you know, um, there's, there's a need here."
- GAGustaf Alströmer
And then after the seed round, you went on to raise a Series A from Benchmark.
- SRSam Ross
Mm.
- GAGustaf Alströmer
Which is, like, one of the most famous investors of, of all time. Um, how did that happen?
- SRSam Ross
Yeah, we went out and fundraised in the middle of summer, which is never a good idea. People are off on vacation. That's when w- you know, a lot of VCs are, they're off in their, their second home somewhere.
- 16:20 – 18:00
Landing Benchmark for the Series A
- SRSam Ross
You know, for us, it just, that's how the timing worked out. Yeah, we went out, and I, I got fortunate to got introed one morning to a c- a second day of fundraising to Chetan, our boar- board m- or now board member at Benchmark. He booked, he booked a meeting, like, same day in the afternoon. Again, it w- I don't think it was necessarily anything I did in particular. It was more like he, he, like, immediately within, like, you know, within a few minutes understood what we were trying to build, understood the market opportunity, you know, the trac- you know, we had really good traction. And so for him, I think checked off boxes, and it was immediately for him kinda went into sell mode. And, and so that was, like, a really, um, interesting experience and, um, a lot of learning from him just how to even sell.
- GAGustaf Alströmer
Did you feel like you, uh, compared to seed round, had the leverage in this round?
- SRSam Ross
Totally. Totally had the leverage. I mean, look, Benchmark's a great firm. Like, they're not gonna pay some crazy exorbitant amount and things like this, but I just think it felt, it felt very different, right? Because, you know, once you get a term sheet from someone, or at least, you know, that gives you leverage to go and, and, and shop or push back on that VC to give you more. And so for, in our case, he was going on vacation to, like, you know, with his family to, like, to, like, India, like, the week after. So he, I knew he needed, wanted to get the deal done. And so, you know, we sorta just, like, set our terms, and we're like, "Hey, we'll, we'll get it done this week, like, week one, if you can meet us here." And we m- and we got there. And so, yeah, it felt way better than the seed round where it was, like, four excruciating weeks. So I think it's, it's either really, really hard or really, really easy. It's, it's never really in the middle. One of the two parties has the leverage there. And so I think, yeah, if you feel like you have no leverage, like, it might even make sense often just to, like, "Hey, let's pause. Let's get back to work if we can and go out later."
- GAGustaf Alströmer
How do you think about the future from now? What, like-It seems like this can be extremely big.
- SRSam Ross
Yeah, yeah.
- 18:00 – 20:00
Expanding from US Sales Tax to Global VAT
- SRSam Ross
So, you know, obviously very ambitious. I think, you know, we started with a very narrow idea to solve, which, which was, you know, hey, we're gonna help e-commerce businesses with their sales tax compliance in the US. You know, I had these ideas, yeah, there's other countries, yeah, there's other markets, but we didn't really spend a lot of time w- w- you know, looking into it. But, um, you know, we- after a number of months, we had a lot of friends that are software businesses. Uh, uh, you know, friends of ours asking if we could help them because, again, software's taxable in about half the states. And really early on we learned from a lot of software businesses is, you know, if you're, if you're a software business, you're selling globally often on day, on day one, especially consumer software. Um, you have customers in, uh, Kosovo, in Kenya, everywhere. And so what that means is very early on, you actually have to think about what's called v- indirect tax or VAT, like these, you know, kind of, uh, analog- things that are similar to sales tax on a global scale.
- GAGustaf Alströmer
Every European country has VAT.
- SRSam Ross
Every European country has VAT, and it's very high. It's, you know, often like 20%. And the rules are, again, different in each country. And so what we realized is like to actually- if we wanna actually build a product for, for software businesses, it can't just be our US product. It has to be a global product. And so that's something we're really excited about, is we're now serving p- customers in 60 different countries, and we handle everything for them, right? So we make sure we're calculating the right amounts, get them registered in Kenya, somewhere like that, go and actually do the ongoing filings. And we feel like no one's built a true global product that really handles everything, calculations, registrations, filings. And so for us, uh, that makes us feel really excited that we, you know, w- we ha- we're not really worried about like the, is the market big enough? It's really, most of our things that get us anxious are really about, like, execution risks. Like, can we actually execute? Not, is there some big existential question around, like, i- is the fundamental market there?
- GAGustaf Alströmer
Uh, one topic I'd love to talk about is Airbnb. So, um, this is, like, a very special time in my career. Like, I spent almost five years there.
- SRSam Ross
Yeah.
- GAGustaf Alströmer
Uh, we worked together on the growth team, uh, which I thought was an, a very special team-
- SRSam Ross
Yes
- GAGustaf Alströmer
... at a very special company.
- SRSam Ross
Totally.
- GAGustaf Alströmer
Uh, at this event here, a lot of founders are actually ex-Airbnb. So, like, the, the Airbnb itself as an organization,
- 20:00 – 22:30
Building a True Global Platform (60 Countries and Counting)
- GAGustaf Alströmer
like, basically created a bunch of new companies. What do you remember about your time at Airbnb? Like, what, what was it like?
- SRSam Ross
First of all, working at Airbnb was fun because the product's, like, amazing-
- GAGustaf Alströmer
Yeah
- SRSam Ross
... and so interesting. And so I think just, like, the baseline, like, energy and vibes and everything were good. And I think it's also when you work on a business that has, like, global network effects, it just makes everything easier and, and less stressful. And, and so I think just, like, the general energy in the companies and working at... I think there was also a certain, like, optimism of startups at that, at, at that kind of period in the mid, the mid-2010s. And so it's just a, a good experience. And there was also just incredible talent density, like you're referring to. So I think, uh, if you can join a company where there's just, like, that level of talent density, it's gonna, you know, pay in dividends for years. That's how I met you, and that made it much, you know, that made me excited to join Airbnb, uh, to join YC. I probably wouldn't be here if I hadn't, if I hadn't taken this, this step at Airbnb.
- GAGustaf Alströmer
Is there anything specific you remember about your time at Airbnb?
- SRSam Ross
The culture at Airbnb tended to be, I would say, very collaborative, and it was a very safe space to work in.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
And I loved at Airbnb it seemed like, you know, there was really this sense of community there. And so I think, yeah, I think we try to definitely bring that into o- our team, where we really try to cultivate a sense of community, especially, you know, especially in office in San Francisco. And so I think that, and then obviously, you know, I think learning from folks like Brian, who br- you know, he, uh, uh, scrutinized every single, uh, piece of software that went out and was really hands-on and, and never removed himself from product. I thought it was always something to learn from because this was like when... Eventually, the company's thousand, you know, 5,000 people. And, and anytime you, you, you ship a product, it had to go through, like, founder design review.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
And I think that's something that we've always had at, at Numeral too, is just you just gotta be so meticulous and detail-oriented and OCD about the product. It's not that always the founder knows the best, but I think the founder has the most context.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
And so at, at minimum, you know, I try to have a low ego around some of these things, but you do wanna, you do often have insights that are valuable because, like, you know, I'm talking to the sales team, and I'm talking to customer support, and sometimes I can make connections for, for folks. Um, and so I think just being really meticulous about any product you ship, um, I learned from Airbnb.
- GAGustaf Alströmer
When you applied to YC, actually, there's, there's one more thing that happened that you probably had not planned, which is the advent of LLMs. And I am imagining that they are very important for your company.
- SRSam Ross
Yes.
- GAGustaf Alströmer
And the last year and a half has made fun and easy, easier to build the software that you wanna build. Tell us about that.
- SRSam Ross
Yeah. LLMs have been, you know, a really huge impact to our business. Yeah, like, like you said, when we started the business, you know, we, it was a few months after the initial kind of 3.5 moment. So we had some ideas. You know, these, again, all these incumbent softwares, we felt
- 22:30 – 25:00
Culture, Co-Founder Dynamics, and Lessons from Airbnb & Stripe
- SRSam Ross
they were very much building you a tool to solve sales tax. And what we realized is, like, I didn't want a tool. I wanted a solution, a service, because often what we see customers doing is they hire a s- you know, like, an accounting firm. That accounting firm uses the sales tax software. And why do you need to have two vendors to solve this boring compliance problem? And so early on, our approach was we see the AIs, th- these LLMs are coming. At the time, it wasn't a lot of infrastructure. But our feeling was, let's do things that don't scale. Let's really do high-touch service. So for example, an early, an early, uh, feature we shipped is, hey, we'll scan all of your physical mail you get from all these different states and read it on your behalf. And we were just, like, you know, we were just ourselves, like, reading tons of pieces of mail. And then at a certain point, I trained up some team to read the mail. And then at a certain point, you realize two guys that were reading... Their full-time job was reading thousands of pieces of mail a week. And we're like, "Wait, what's going on? Like, why, like, why haven't we automated this?" And so very simple problem, like, you scan a g- a letter from the government. There's only, there's a very fixed amount of types of letters you can get. We can put them into buckets. We can extract different information from that and create, and create different workflows. And so you're gonna take something that normally is that you have to have someone either on your team or an, or an accounting firm that's reading government mail and, like, going and taking action on it. And this is just something that's now completely automated and obfuscated away from, for the, for the customer. I think you're just seeing, you're gonna see a trend, a lot of these SaaS businesses where, again, often you're building tools for accountants or tools for lawyers, and in some cases it can actually just do the whole job end to end. And the way the software works is, you know, our software isn't re- it's not really designed for people to spend lots of time into it. It's really more about how do we get as much of this problem done for you as possible so you don't even have to bother logging in? There's still work to go to get there, for sure, but I think LLMs empower these kind of different user experiences.
- GAGustaf Alströmer
Tell me about, uh, your co-founder, Matt.
- SRSam Ross
Yeah.
- GAGustaf Alströmer
Like, how do you guys work together?
- SRSam Ross
Uh, Matt and I work very closely together. You know, these, these kind of relationships are always challenging, and I think, you know, it's, it's hard to always see eye to eye o- on everything. But for whatever lu- lucky reason, Matt and I tend to gen- generally tend to, you know, tend, tend to see eye to eye pretty closely on things. I would say broadly, too, we probably need to get cleaner division of labor, but we often, you know... I think for me it feels like, um, it's always someone who can be a sounding board. Like, he was out recently for a week, and it felt like I had, like, left my phone at home. And like, like, every- things come up, like I did... To me, it's almost like a built-in therapist in some ways, right? Where it's like you, you see a thing, you're like, "Am I crazy here? Am I thinking about this right?" And we're just kinda talking throughout the day constantly, um, and just, and just checking each other's work. And, and so we, we tend to be, you know... I think everyone has different relationships. Some people, I think some folks maybe it
- 25:00 – 27:00
What AI Unlocks for Compliance and Automation
- SRSam Ross
works better to have clean division of labor, and you meet up here and there. For us, I think we, we collaborate on decision-makings.
- GAGustaf Alströmer
And you were both co-founders of separate companies before. He actually ran another YC company prior to Numeral. So y- I guess you had-Founding experience that you brought into this company
- SRSam Ross
Both the founding experience, um, you know, Matt was very early at Stripe and very early at Notion.
- GAGustaf Alströmer
Right.
- SRSam Ross
And so those were, like, two very intense cultures. Um, I feel like, you know, I'm learning a- I've learned a lot about, like, how Stripe operates or how Notion operates from Matt, right? So, like, Stripe had, like, incredible documentation culture and writing culture and, and things like this. And so, um, for me, it's also just valuable to e- you know, kind of steal that DNA as well and kinda graft that onto the company. He learned directly from, um, from the Collison brothers and from Ivan Zhao. And so often he's like, "You know, Patrick would do it this way," or, "Ivan would do it that way." And it's, it's really helpful for me to get that, that, that, that kind of, um, coaching.
- GAGustaf Alströmer
What motivates you to keep running this company when things are really hard, or what motivates you and Matt to do this? I'm sure there's gonna be a moment where, or you've had moments where things were really hard.
- SRSam Ross
For me, it's like a game running a startup. You know, I grew up, uh, really nerdy, like fantasy sports, and you, you, you would take some actions, you see what happens, and you get feedback loop. And, and so for me, it sort of feels like this, this, like, like a, like a game. And so games get hard, but I think there's always a satisfaction that, that you can keep, keep winning. And I think ultimately there's no turning back. And so I think if, if you, if, as long as you, like, know you're committed, like, and you're not questioning that, like, you can get through the hard stuff. I think where it gets hard is if you're like, "Oh, I could quit," or that option's there, then, then I think it makes it harder to stay. But, like, you know, we're fully committed and so you don't even... You know, often even when things are hard, you don't even question it just because it is the default. Like, "Hey, I'm, I'm gonna be doing this for the next, you know, 10, 20-plus years." And so it ma- that makes it easier once, like, once you're psychologically committed that this is what I'm working on.
- GAGustaf Alströmer
If you were, um, watching this right now, you're 20, 21, 22, graduating college, like, um, what advice would you give yourself about how to spend the next five, 10 years of your life?
- SRSam Ross
It's hard to give advice to anyone. Everyone's different. I think, you know,
- 27:00 – 28:29
Playing the Long Game: Building a Durable SaaS Company
- SRSam Ross
I, I really, like, like, my path was, again, was, like, worked at some startups, did some bootstrap stuff, got a lot of, like, travel out of the way. And then for me it was very nice because I was like, I don't have FOMO about doing some digital nomad, doing some traveling. So it worked out well for me, and I think I've seen some people where they just jump into a startup in their early 20s and then they see their friends having fun.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
But at the same time too, when you start a company in your early 20s, you have way more energy. Like, you don't have to sleep as much. Yeah, um, my, my wife's pregnant, you don't have these type of thing. And so e- every- everyone's experience is different, but for me, I think it was important that I, like, got a lot of stuff out of my system so that I could just be clear-headed and just li- and focused on that. Again, I think the biggest thing is, like, know what you're signing up for and make sure if you have anything that you wanna get done before that, like, get it done before that, right? [laughs]
- GAGustaf Alströmer
I've, I've seen Numeral now from the outside for, like, two and a half years. It's been really, really impressive. Like, it's, like, honestly, like, um, so cool to see, like, everything you said in the beginning on that first time we, we talked about the market and the problem, like, kind of turn out to be true. It's really cool.
- SRSam Ross
Thank you. Yeah. It was, um, I feel fortunate. I think if I had some friends that are like, they've known me for the last few years, like, selling jewelry online, these funny things. They're like, "Are you actually gonna, like, build a serious business here?" And but we are, and I think, again, it's been helpful YC, just the framing of like, "Hey, you need to have this level of ambition. Like, don't think small." And so, um, it's been so fun to get to work with you again. Um, it's been, um, incredible.
- GAGustaf Alströmer
I really enjoyed it. Thank you for joining.
- SRSam Ross
Thank you.
- GAGustaf Alströmer
Yeah.
- SRSam Ross
It was so fun. [upbeat music]
Episode duration: 28:29
Install uListen for AI-powered chat & search across the full episode — Get Full Transcript
Transcript of episode 5jHWBQqiylo
Get more out of YouTube videos.
High quality summaries for YouTube videos. Accurate transcripts to search & find moments. Powered by ChatGPT & Claude AI.
Add to Chrome