445: Cello: How a Scrappy MVP Became a 7-Figure SaaS with 7M Users - with Stefan Bader

Summary

Episode Summary: "Cello: How a Scrappy MVP Became a 7-Figure SaaS with 7M Users" with Stefan Bader

Podcast Information:

• Title: The SaaS Podcast - SaaS, Startups, Growth Hacking & Entrepreneurship
• Host: Omer Khan
• Episode: 445
• Guest: Stefan Bader, Co-Founder and CEO of Cello
• Release Date: May 29, 2025

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Introduction

In Episode 445 of The SaaS Podcast, host Omer Khan engages in a compelling conversation with Stefan Bader, the co-founder and CEO of Cello. Cello is an innovative all-in-one referral platform designed to help SaaS companies reward their users for bringing in new customers. Stefan shares his journey from identifying a significant gap in the market to scaling Cello into a 7-figure SaaS business with over 7 million monthly users.

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The Genesis of Cello

Identifying the Gap

Stefan’s entrepreneurial journey began during his tenure as Chief Revenue Officer at a payment processing company. He observed a recurring issue: while users were actively bringing in new customers, there was no efficient system to reward them. Existing tools catered primarily to affiliates and influencers, leaving a void for individual user rewards.

Stefan Bader [03:01]: "Show me the incentives and I'll show you the outcome." — Charlie Munger

This insight became the catalyst for founding Cello in 2022, aiming to create a platform that seamlessly integrates referral rewards into SaaS products.

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Building the MVP: Challenges and Learnings

Overcoming Compliance Hurdles

Developing Cello's Minimum Viable Product (MVP) was fraught with challenges, particularly around compliance. Stefan and his team had to navigate intricate compliance laws across multiple countries, international banking regulations, and tax requirements.

The Scrappy MVP Approach

Initially, Cello's MVP was rudimentary. Instead of a polished dashboard, customers accessed analytics through shared Notion pages, and operations were managed manually via Python scripts.

Stefan Bader [11:38]: "We were sharing via Notion pages... just Stefan's team running Python scripts and configuring everything manually behind the scenes."

Early feedback was critical. Some customers remarked that it wasn’t a product, yet Stefan remained steadfast, prioritizing the core functionality of generating referrals over initial product aesthetics.

Focusing on Core Value

Cello’s primary goal was to demonstrate that the platform could effectively generate more referrals. Stefan emphasized simplicity in pricing, adopting a success-based model where customers paid only when they profited from referrals.

Stefan Bader [14:58]: "We decided on a freemium success-based pricing and success in our world means referral ARR."

This approach was instrumental in building trust and proving the platform’s value despite its early-stage limitations.

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Growth Strategies: From Early Adoption to Exponential Scaling

Educating the Market

A significant hurdle was that many SaaS companies were unaware of the need for a specialized referral platform like Cello. Stefan took on the role of educator, explaining how user referrals differ from traditional affiliate programs and highlighting the missed revenue opportunities.

Leveraging the "Powered by Cello" Loop

The breakthrough came with the innovative "Powered by Cello" link embedded in customers' widgets. This subtle branding exposed millions of users to Cello organically, acting as a powerful growth driver.

Stefan Bader [23:27]: "We have close to a million users opening our widget and therefore many, many eyeballs, which leads to quite a decent amount of inbound."

This strategy created a self-reinforcing loop: as more users interacted with the referral widget, more organic exposure led to increased sign-ups, fueling further growth.

Compounding Growth Systems

Cello’s growth strategy is built around creating compounding growth loops rather than relying solely on linear marketing activities. This approach ensures sustainable and exponential growth by continuously adding more components to the growth engine.

Stefan Bader [19:49]: "We believe in building always compounding systems where we just add more and more to that system in order to make it spin faster."

The company’s focus on growth loops, such as the casual contact loop, has been pivotal in driving consistent and scalable user acquisition.

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Content Collaborations: Accelerating Awareness

Strategic Partnerships

Instead of building an audience from scratch, Stefan opted to collaborate with established content creators who already possessed substantial followings. This strategy expedited brand awareness and lead generation.

Collaboration with Kyle Poyar

A notable collaboration was with Kyle Poyar, a renowned growth expert. By providing proprietary data and unique insights, Cello co-created valuable content that reached tens of thousands of subscribers, significantly boosting their visibility.

Stefan Bader [31:33]: "We aimed as high as possible. I got in contact with Kyle Poyar... and we delivered content that was published on his Substack, reaching tens of thousands of inboxes."

Organic Over Paid Collaborations

Cello found greater success with organic content collaborations compared to paid ones. Authentic partnerships with influential creators yielded more engaged and responsive audiences.

Stefan Bader [35:44]: "The organic content collaborations worked because we provided a lot of value to the piece... people were actually investing in it to create something valuable for the community."

This approach not only enhanced credibility but also ensured that the content resonated well with the target audience.

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Network Sales: Building Through Relationships

Initial Sales via Personal Networks

In the early stages, network sales played a crucial role. Stefan leveraged his personal and professional networks to secure initial customers and investors, offering them stakes in the company’s pre-seed round in exchange for their commitment to implement Cello.

Stefan Bader [40:11]: "I was reaching out to basically people in my network and... offered them a little ticket in our pre-seed round."

These early adopters served as design partners and helped validate the product, making it easier to attract subsequent customers through proven success and testimonials.

Transitioning Away from Network Sales

As Cello grew, the reliance on network sales diminished to about 5%, replaced by diversified growth channels like content collaborations and automated outbound strategies.

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Building a Strong Company Culture

Prioritizing People

Contrary to the common practice of hiring developers or salespeople first, Cello’s second hire was a Head of People. Stefan recognized that a strong team is the backbone of a successful company.

Stefan Bader [43:39]: "Most founders would agree that their team, their people are the most important asset."

Hiring Filip as Head of People ensured that talent acquisition, retention, and culture-building were prioritized from the outset, fostering a high-performance environment.

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Quick Fire Questions

Towards the end of the episode, Stefan shares personal insights through a series of quick-fire questions:

1. Best Business Advice Received:

   • "Pick your battles." — Emphasizing the importance of focusing on what truly matters.

2. Recommended Book:

   • "The Acceleration Formula" by Marco Bersch and "Multipliers" for managers. — Valuable resources for go-to-market strategies and effective management.

3. Attribute of a Successful Founder:

   • "Having a reality distortion field." — The ability to envision and push beyond perceived limits.

4. Favorite Productivity Habit:

   • Daily walking meetings. — Encouraging active recovery and mental clarity.

5. Dream Business Idea:

   • LLM SEO. — Reflecting interest in leveraging language models for search engine optimization.

6. Fun Fact:

   • His first entrepreneurship professor tried to discourage him from continuing his initial business venture, which he overcame.

7. Passion Outside Work:

   • Football fandom, specifically following Bistrutka.

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Conclusion

Stefan Bader’s journey with Cello exemplifies resilience, strategic growth, and the importance of prioritizing core value over superficial product features. By focusing on building effective growth loops, fostering strategic partnerships, and cultivating a strong team culture, Cello has successfully scaled to a 7-figure SaaS business serving millions of users. This episode provides invaluable insights for SaaS entrepreneurs looking to navigate the complexities of building and scaling their own businesses.

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Connect with Stefan Bader:

• LinkedIn: Stefan Bader

Explore Cello:

• Website: Cello

Transcript

[Omar Khan]

Foreign welcome to another episode of the SaaS podcast. I'm your host Omar Khan, and this is a show where I interview proven founders and industry experts who share their stories, strategies and insights to help you build, launch and grow your SaaS business. In this episode, I talk to Stefan Bader, the co founder and CEO of Cello, an all in one referral platform that helps SaaS companies reward their users for bringing in new customers. Back when Stefan was a Chief Revenue officer at a payment processing company, he noticed something odd. His users were bringing in tons of new customers, but there was no way to reward them. Every tool out there was for affiliates and influencers. Stefan saw the opportunity and in 2022 he quit his job and started Cello. But building it turned out to be way harder than he'd imagined. Paying individual users meant navigating compliance laws in dozens of countries, international banking regulations and tax requirements that no one had mapped out before. And his MVP was embarrassingly basic. Customers got their analytics through shared notion pages. No login portal, no dashboard, just Stefan's team running Python scripts and configuring everything manually behind the scenes. This is not a product, one early customer told him. But Stefan stayed focused on what mattered to could it actually generate more referrals? The answer was yes. He also made pricing dead simple pay nothing until you make money from referrals. However, most SaaS companies didn't even know they needed this product. So Stefan had to educate every prospect about why user referrals were different from affiliate programs, why it mattered, why they were leaving money on the table. As early customers started seeing results, word slowly spread. But the real breakthrough came from something tiny, a Powered by Cello link in their widget. As customers grew, millions of their users saw it. That little link actually became their biggest growth driver. Today, Cello generates multiple seven figures in ARR powers referral programs for companies like Miro and Typeform, and reaches over 7 million users each month. In this episode, you'll learn how Stephan turned rejection into validation by focusing on outcomes over features even when customers said he didn't have a real product, why Network sales drove 100% of their early growth, and how Stefan leveraged investor connections to land first customers, how partnering with Kyle Poyar and other content creators unlocked tens of thousands of prospects without building an audience. We talk about why Stefan chose boring compliance infrastructure over flashy features, and how it became their competitive moat, and how success based pricing removed all risks for customers and accelerated adoption in a market that didn't even know it needed them. So I hope you enjoy it, Stefan welcome to the show.

[Stefan Bader]

Thanks so much for having me.

[Omar Khan]

My pleasure. Do you have a favorite quote, something that inspires or motivates you?

[Stefan Bader]

I do. Which is also pretty related to what we're doing at Cello. So the quote is from Charlie Munger, one of the greatest investors of all time and probably many of you have heard it. Show me the incentives and I'll show you the outcome. Fantastic quote. It's true in so many areas of life.

[Omar Khan]

Yeah. Yeah, that's a great one. So tell us about Cello. What does the product do, who's it for, and what's the main problem you're helping to solve?

[Stefan Bader]

Yeah, so Cello is the first all in one referral platform that allows software companies to launch their own referral programs within hours and on autopilot. So basically everyday users and partners are being monetary incentivized to recommend the products they're using and to get a personal monetary incentive by doing that. At a time where customer acquisition costs are rising pretty quickly and at a time where legacy acquisition channels are reaching the end of the S curve, Cello provides an alternative to acquire customers virally and cheaper.

[Omar Khan]

Yeah, I think where it really landed for me was when you were telling me earlier that on the one hand you can have these referral programs where, you know, people get a referral link and they can go and use it and, and maybe there's some kind of, you know, financial incentive or the kind of the B2C space and the Dropbox example where people are getting more storage for referrals, but you get into this really weird space where it's like, no, it's the users of our customers that we want to incentivize. But how do you do that? They're not paying for the product. It's like, where did this even. Well, actually, before we get into that, because that's probably a deeper conversation, just help us understand where are you currently in terms of the size of the business, in terms of revenue, customer size of team?

[Stefan Bader]

Sure. Yeah. So we're 19 people spread across Europe and Asia. We're at around two and a half million. In AR, we have around 150 customers, close to seven million what we call monthly enabled users. So monthly active users of our customers that can on a monthly basis engage with our product inside their tools and are very proud of customers like Miro and Typeform, Vite Pleo. So the best SaaS tools out there and we help them to grow via referrals.

[Omar Khan]

Awesome. So the business was founded in 2022. Tell me, what were you doing Prior to that. And actually probably the story goes further back because this is something that you experienced firsthand trying to build yourself. But just explain like what were you doing before you started this business and where did the idea come from? I know a lot of it was from your own personal experience and pains and exactly what were you seeing?

[Stefan Bader]

Yeah. So maybe I go back to the very beginning and talk a little bit about the inception of Cello. So I started my first company around about 12 years ago in automotive. Very hostile place to start a SaaS company, I can tell you. We sold the company after five years to Continental. I stayed a few more years for the post merger integration and then became became chief revenue officer of another SaaS product. Basically what Square does in the US but focused on European markets. So I moved out of Automotive connected services into the beautiful world of SaaS.

[Omar Khan]

And.

[Stefan Bader]

We had many users that were introducing us to new prospects, to referring us new customers. And at some point in time they always came to us and asked what's in it for me if I bring you a few more customers? I would also like to get a piece of the cake. Otherwise I just don't bring you any more. At the time we didn't have any infrastructure at Shora in place for that. So we decided, okay, let's maybe get some infrastructure in place, let's get a referral program up because it's a beautiful customer acquisition channel. And I set up my growth team just to do some research and vendor analysis in order to pick the right vendor for that. They came back and basically said, sorry, there is nothing out there that we can use for that. All the tools we were able to find are all affiliate and influencer type referral platforms, but nothing you can integrate into your product. Nothing that that allows us to pay out users personally and not a business. And that was like an aha moment for me. So first of all I did research myself because I couldn't believe it came to the conclusion. Their research was pretty buttoned up and then I thought about building it ourselves because it used to be quite an interesting channel for us. But my CFO told me that there is no chance because it's too complex, it would require us on the finance side to invest heavily in order to get this to work. And that was basically the inception story of Cello. Quickly after that I played a little bit around with the idea and then I decided to quit and start this company. Obviously after more research and talking to more founders and growth operators. But everyone seemed to have the same issue.

[Omar Khan]

So one question that you get asked a lot. I'm going to ask as well, if this was such a great idea, why had nobody built it?

[Stefan Bader]

Actually this was the most asked question, especially during our pre seed fundraise and at the time I didn't really have a good idea. I think with more time there are a few things that led to. No one actually was building that. So first of all, PLG product led growth is a go to market strategy that hasn't been around since ever. It got more and more adapted in the last five, maybe 10 years. So buying behaviors have changed dramatically. People inside companies are deciding to buy and purchase tools and then it's being adopted by the team and eventually by the company and before that it was just buttoned down, top down, decided by one person. That is like a shift in buying behavior and then it's actually quite a complex product to build. Not necessarily because of the technical side also, but also because it requires different compliance layers in order to pay out users personally as a business, it's quite a non trivial business transaction and we had to overcome this not just in one market, but in many, many markets even with the first customer because their user bases are usually spread across the world and therefore like the first barrier to entry for our product was pretty high from the beginning.

[Omar Khan]

So you mentioned you talked to founders, operators, you got a sense of what was going on and this was a pain that it wasn't just something that you were experiencing personally, but a lot of SaaS companies, B2B SaaS companies were having these challenges when somebody, you know at this stage, when somebody starts to build a product or an mvp, we know the usual thing, right? Maybe it's a lightweight, maybe it's a clickable prototype, maybe it's a user interface, I don't know, whatever, but get something visible in front of customers. But interestingly enough a lot of your focus was on things like scalability and compliance and all of this stuff. Can you just explain why that was so important for you from the start?

[Stefan Bader]

Yeah. So as an infrastructure product you have to pay attention on features and details many non infrastructure products don't have to pay attention to. As we become a functionality inside our customers products, it needs to be super reliable that nothing breaks if we're there. Right. It needs to be scalable because in terms of users our scaling has been probably much faster than other SaaS companies would see it out there. Just because we're piggybacking on our customers users in terms of compliance, we had to take a lot of checkboxes in order to make the whole process of attribution and rewarding compliance across multiple countries. And therefore, we had to do many, many things that require a lot of resources and attention at the beginning. And in order to ship quickly, in order to iterate quickly, we were basically sacrificing other things that if you would just ask your customers that these faults would see as must haves. But in the end, they're not necessarily must haves. So one example I can give is at the very beginning, right with the first customers we launched, we didn't have a portal to log in, we didn't have a portal to login where they would see their analytics, a portal to login where they could change the settings of their referral program. All this basically was either automated and provided via notion, like via notion pages. We were just sharing with our customers or we were asking them about how the program should behave and what the program parameters should look like. And we were like behind the curtain, setting everything for them up and running scripts in order to make sure everything is according to their needs. But we heard a few times at the beginning, this is not a product, even though we had an end to end working product that does what the version one we thought should have. And then over time, obviously we built everything that in addition to that was expected. But we came quite far, or we got quite far with that, like absolute minimal viable product in the end, which helped us to iterate on the areas where we thought are most important. And a referral program in the first place needs to be on, you know, needs to acquire more customers and needs to acquire more revenue. That is like the single most important goal of a referral program besides, like, you know, it shouldn't obviously break the product experience and so on. But all the other bells and whistles, even though they might be considered if you ask your customers straight away if it's a must have or not a must have, they don't really matter at the beginning.

[Omar Khan]

First of all, were you charging these customers, these early customers?

[Stefan Bader]

Yeah. So we believe in the alignment of incentives and we also believe in there should not be any roadblocks in order to get something started. What we have, therefore, we decided for a freemium success based pricing and success in our world means referral ar, so everyone gets through the door for free. And as soon as the program is performing, we're basically charging for that. So even though the first customers signed off on that deal, and then over time, basically we were charging them as soon as the success kicked in.

[Omar Khan]

Okay, and so you were using notion for a dashboard, just sending them a link to something that they could look at. You were using kind of like this wizard of Oz MVP through Slack, where they were kind of getting onboard in the setup and you were writing these Python scripts in the background. And then presumably they had to do some work on their end to embed the solution into their product. A lot of founders would be terrified to get that in front of customers, because it doesn't look like a product, it just looks like a hodgepodge of different things. And how did you navigate that? How did you try to set expectations with customers? Because I think there's probably a really valuable lesson here that if more founders could take steps like this to focus on the solution, rather than being overly worried about how beautiful and perfect and complete it looks, you can probably make faster progress. But there's always this thing that you're going to disappoint customers.

[Stefan Bader]

It's a great question. So we were heavily leaning on selling the value of the product and not necessarily the features. And the value of the product is something that sold or partially sold One of their biggest issues, which is distribution and customer acquisition at reasonable ltv, cac, or sustainable levels. We also, at the very beginning, sold via our own network or direct or indirect network. So therefore we had a certain level of trust with the first customers, I would say. And the overall appearance of, let's say, the website and also the sales pitch, I can talk a little bit later about that, I think was pretty solid and buttoned up that as soon as they entered onboarding, I think they were overly convinced that it's going to be the right solution for them. And then throughout the onboarding process, at the very beginning, they found that just some pieces are not there, but we could convince them that it's not really necessary to have this at this point. And we will obviously build this over time, which we obviously did by now. So everything I'm talking right now is very early and scrappy. Days of cello. And as soon as they got it live and they saw the performance, it didn't really matter anymore. It didn't matter if they had to visit a notion page to see the signups and purchases flying in, or if it would be a perfectly crafted dashboard, they could sign in.

[Omar Khan]

Yeah, I think I was going to say the ultimate lesson here is that we have to remember that customers aren't buying the product, they're buying the outcome. And sometimes it's easy to kind of get confused and worry about the wrong thing. When we were talking earlier about growth Tactics and how you built the business, got it to seven figures and beyond. You said to me we sort of really think about this as a growth system. And explain to me what you mean by that. And was that something that you were very intentional about early on or is that something that has sort of evolved over time?

[Stefan Bader]

First of all, we're building a product for growth managers in the first place. Some companies don't have growth as a function that it's marketing, but we're, we're selling into an area where first of all we had to build up a lot of knowledge about the topic more than, for example, technical founders would have to do. So we understood our own go to market. We think about it probably more as growth managers, as of classic marketing managers. And therefore we believe that what we're building is like a compounding growth system with growth loops at the core and then linear marketing activities that accelerate those loops. And if I talk about growth loops, what I mean by that is it's basically compounding input activities that lead to a certain output that again serve as input for the same, for example, acquisition channel. So at the core of our growth system is what we call, on what is called in literature, casual contact loop, which is by far the most successful and strongest driver of inbound. For us. It's called casual contact loop. And this is this little powered by branding that you will see on our widget and that for example, has been pioneered by let's say, Intercom or Superhuman. So many companies out there get in touch with us by just casually checking out the referral program of let's say a Miro or one of our customers. And it's not just important for us to create new touch points with customers, but also very important for the user of a Miro or of a Typeform in order to have a first casual contact with, with Cello. Because in the end if they're sharing and if they're successful in that referral journey, they will be paid out via our platform. So they know that if something is being paid out via Cello, they know where this is coming from. Right. So therefore we have like a quite, quite a nice symbiosis of creating value for the users, but also having a very impactful acquisition channel for us and all the other growth loops we're building basically around this core growth loop. And also all the marketing activities we have lead as accelerator for the growth loops we have in that system. So some companies out there that heavily lean on marketing campaigns, let's say, where you have a one off peak and Then after the campaign is over, it dies out. We strongly believe in building always compounding systems where we just add more and more to that system in order to make it spin faster. And I think that's like a more reliable and sustainable way to acquire customers, which makes it also pretty repeatable in a way. And it's not just that we're like building this for us, but the vision of Cello goes far beyond referrals in the end. So the vision of Cello is to create a growth operating system where we productize different growth loops in order to provide it to, to our customers. Whereas user and partner referrals are just the first two growth loops we've built. Right, and there are many more growth loops that are coming in over the next few months and years.

[Omar Khan]

So just explain to me a little bit about this powered by kind of the casual contact that you talked about. So people see this somewhere in the product that they're using, it leads them to discover Cello or whatever. So just explain to me one, how that's turning into a potential referral. And then secondly, maybe give me an example of how you are like an example of the compounding piece, like, how are you kind of maybe driving people.

[Stefan Bader]

There to start with, explaining what CasualContact Loop is. Maybe I start with a more renown example. Let's say Intercom. You know, these little chat windows, if you click on that, you know, bubble on the bottom right corner, it opens up Intercom and then at the bottom of that widget it says we run on intercom or something like that. If you click on that, on that little button, it leads you to the Intercom site. So as a user, you know, interacting with this chat window, you will find this little branding. And if you click on a branding, you land on the Intercom page and therefore you understand, like, this is the infrastructure provider for that chat tool. And we basically adapted that and did the same for our referral widget. So if you click on a. Usually our customers use like a gift icon somewhere placed inside the product. If you click on that, our referral widget will open. And it also says at the bottom, share and earn with Cello. If users click on that, they will also land on our website. By now, on a monthly basis, we have close to a million users opening our widget and therefore many, many eyeballs, which leads to quite a decent amount of inbound because we're offering something that hasn't been out there, hopefully solving a problem they see. And this is just like at the very core of our engine. And around this, we're building additional growth loops and linear activities in order to drive that. What I mean by that is so if you think of that loop, let's say user clicks on gift icon, user opens our widget, clicks on that Cello branding, lands on our page, signs up as a customer or launches Cello inside their product. More users are being exposed to that widget because all, all their users can see the referral program inside their company. And then the loop starts again. More users can see it. Their users might be also interested in something like Cello. They become customers and then the loop continues to compound. And our inbound from referral from CasualContact Loop is basically pretty linear to the amount of users we're adding to our platform, which is an exponential curve. So it's a pretty nice flywheel in itself. And then in order to accelerate this, for example, we obviously also dog food Cello. So we also use Cello for referrals. If we close more customers via referrals, we add more users to our product and therefore more eyeballs on casual contact loop. Right. And it also helps compounding the casual contact loop, for example.

[Omar Khan]

I mean it sounds too simple, right? It's just like in the, I mean obviously it's very thought through, but ultimately it boils down to the more people who can see this powered by, you know, logo or whatever in the widget is ultimately going to lead to more people discovering Cello signing up for the product, which is going to lead to more of their users seeing Cello and ultimately some of them becoming customers. And if we just keep doing a good job at getting the right people to see this through, everything we're doing, this exponential growth that comes from that.

[Stefan Bader]

Not every product has a possibility to offer something like this. Some products are just more closed. Think of a, of an accounting tool like it's going to be difficult to implement something like this, but the products that have the possibility to, to, to have casual contact loop or you know, there are more loops out there where we will also be shipping products for, for example, user generated content. It's beautiful because it, you know, it compounds, it grows exponentially and usually to like very little or even no costs because it's like an organic growth loop. But yeah, in the end everything is more complex than it seems with our model. We also need to make sure our customers are not just somewhat happy with our product, but are actually financially successful because the way we price and therefore our goal is basically to ship a product that works across different industries that makes our customers financially successful in order for us to to monetize.

[Omar Khan]

Let's talk about how specific growth channels that have helped you to go from the first 1020 customers to going to the first million in ARR. And I know you invested some effort in content collaborations as a way to do that. Many founders would default to content being I'm going to write blog posts, I'm going to spend time building an audience on LinkedIn, which is not a bad thing to do, but it's also a very slow and painful thing to to build your own audience. You did that a little bit differently. You found people who already had audiences and you started to build some relationships there. So let's talk a little bit about that.

[Stefan Bader]

It's exactly what you said. You can create content and you can hope that it indexes at some point in order to bring you to drop feed you leads. We decided very early on for a different content strategy where we were not so reliant on the Google algo, which I think looking back was quite a good idea with Google crushing everyone's traffic with their AI summaries. So what we decided on is to work together with the best content creators in our field in order to create awareness for the problem, but also for the solution in combination with our brand linked to it. And in order to do this successfully, we are of the opinion that you got to start or you got to aim very high in order to make it successful. So if we for example would have started with a mediocre or with mediocre type content creators or just content creators that are not so renown and maybe newer in the field, it would have been more difficult to from that level get to like a higher level. It's always easier to like start very very high and as soon as you work together with the best out there, everyone else is like is going to be more interested to work together with you. And therefore we aimed as high as possible. I got in contact with Kyle Poyer who is like for people that are not so much into growth and.

[Omar Khan]

Yeah.

[Stefan Bader]

SaaS pricing for example, he's like the OG of growth in our industry and as I was anyway in touch with the VC fund he used to work with, I just asked for an intro. He used to be operating partner at that VC firm and working together with founders on a daily basis and I just asked him if he would be interested. Luckily he heard that he had questions from founders around referrals experimenting with new acquisition channels before and he just couldn't give good answers. So at the time I was just pretty lucky. I guess he was Interested in writing together a piece where we would deliver proprietary data points and just insights no one else would have. And he, on the other side would provide his feedback and expertise, but also obviously his audience because it was published on his substack Il go sent into tens of thousands of inboxes, which for us was like a kickstart, which you usually don't get from writing content. And that strategy we kept doing with other amazing folks in the content space out there, which led to long form content that also ranks on Google, but also short form, short term spikes in terms of inbound because it's being distributed via substack and via email. And we then were recycling that content, of course, also on social media, which works quite well with our automated outbound motion. And what we did there is we, you know, go after certain industries that we, for example, have already customers and customer success stories with. We connect via people that are relevant to us with my profile on LinkedIn and if they're interested straight away, right, great. We jump on a call. If they're not interested, it's also fine. But then we're like creating relevant short form content around growth and like closer topics to our product, not directly, but like valuable content. And through that short form content, we're also like nurturing those leads over time by just being helpful and creating valuable content. And that combination of long form and recycled short form content in combination with our automated outbound motion is pretty powerful. And yeah, since the early days were like hammering on that and iterating and optimizing it.

[Omar Khan]

Kyle has been a guest on the show and I think he's done a great job building a pretty big audience in the last few years. Even he didn't charge you for the content that he created. There was some value exchange that you wanted to get people in your space educated about this problem and a, a solution that you were offering. And you had this proprietary data that helped Kyle come up with some good answers and insights to questions that he was already getting asked by founders. So I think there was a good fit there. Was that the same kind of value exchange you worked with other creators? Did you have to have to pay for content? In principle, it's a great model, right? Go and find people who are the audiences and do this. But a lot of those people are getting overwhelmed by all kinds of pitches all the time. And often if you're kind of going for the relationship angle that takes time to build. How did you, what were the things that worked well for you to be able to make a breakthrough with some of these creators.

[Stefan Bader]

Yeah. So starting with Kyle, as said, might be a lucky coincidence. Basically, we're breaking up the market for us in terms of collaborations with other relevant content creators because it seems like everyone is admiring him and everyone feels better if their content piece is next to his. So that made it way easier to get into the second and third, like, unpaid, completely organic content collaboration that worked basically along the same lines. So my advice is aim as high as possible. If you don't aim completely high at the beginning, it's going to be more difficult to climb up again. We also tested with paid collaborations, but the results were not the same. Just because of the. I mean, it says sponsored and it also has a different vibe. And I think people are somewhat, or become somewhat blind to commercials or advertorials. And so therefore the organic content were we are creating or we're creating with content creators by just providing a lot of value to the piece. And our unique insights in an area that is not red ocean has been valuable enough that people were actually investing also in it in order to create something valuable for the community. So that is like, if you can find content, if you can convince amazing content creators out there to collaborate on this, everyone benefits, I guess.

[Omar Khan]

And was the proprietary data the main sort of value exchange that you were leading with when you had these conversations?

[Stefan Bader]

Yeah, I would say so. Proprietary data points and metrics, but also insights in what works, what doesn't work. What we have seen out there to an extent where many companies were scrambling around, maybe with their own approaches or ideas, and we were indexing that across multiple companies in order to come up with real insights and also benchmarks, obviously. So I think that was very helpful because in the end, it's difficult to create a valuable tactical piece if you can't back it up with data. And I think that is what we mostly brought to the table.

[Omar Khan]

So you had the content collaborations, you talked about dogfooding your own product and using Cello and referrals and so on. But you're also doing sort of network sales, right? What was all that about?

[Stefan Bader]

I mean, network sales was very important for the beginning of Cello before we had other growth loops and channels up. At the beginning, we were heavily leaning into our network. We were even for our pre seed round, expanding the route in terms of how many parties we let in. So we got six microfunds on board for our pre seed and quite a couple of angels that were functioning as design partners for early Cello and then also obviously via those micro funds in their portfolios. But also via our angels. We were heavily leaning on network sales at the beginning, which is I think the way to go at the very early days. Later on, as we got a bit bigger, we layered other ways to acquire customers on top of it. So network sales now has become maybe, I don't know, 5% where at the very beginning it was, at the very beginning it was 100% and then it shrunk over time.

[Omar Khan]

So just kind of explain to me a little bit, break that down. Like, how are you, what were you doing? How were you kind of figuring out who you were going to sell to? Just help us understand that next level of detail here.

[Stefan Bader]

Think about us as a pre, pre seed company. No product, but vision and a slide deck. I was reaching out to basically people in my network and in order to get them committed to implement cello, I basically offered them a little ticket in our pre seed round. Like they were to some point excited and convinced about if it works, it's going to be pretty good. And therefore those commitments helped us also to close the round because we had first design partners lined up and those commitments also helped us to build the product in the early days because even though not everything was perfect, they had like shared incentives because they were also investors in the company. And those first customers helped us also to convince like the next customers and the next customers. So we basically leveraged our pre seed funding round in order to get like really strong commitments from first customers in the end. And then like indirect networks, we had micro funds that have like tens and hundreds of SaaS companies. So obviously it's easier to sell to someone where you get an intro compared to like, you know, blindly and like cold outreach. And that helped us at the very beginning a lot.

[Omar Khan]

So you were very intentional about who you were, who you were like identifying as potential investors, who you would, who you were spending most of your time and effort trying to reach out to. Because it was not just about the investment side, it was also about the fit and the additional potential value that comes from that type of relationship.

[Stefan Bader]

Yeah, 100%. I think especially for early stage companies, they should always leverage funding rounds in order to also think about sales and in order to build that pipeline. And the earlier it is, the bigger party round can be that it's also meaningful for angels because at a later point in time, let's say post series A, the tickets will be so big that not many angels will benefit from participating in such a round. So it's really about the pre seed and seed rounds where you can apply this tactic. And I think you should always have this in mind when raising in the early rounds.

[Omar Khan]

Cool. Okay. We're going to have to wrap up soon, but I want to ask you one question before we do that. And I think it in many ways reflects the way that you guys are building this business and the people around you. That many founders, the first or second hire you expected to be a developer. Your background as a CRO, Maybe the first or second hire is a sales guy, I don't know. Right. But your second employee was head of People. Like why?

[Stefan Bader]

Yeah, I get this question asked a lot. If people hear about that, I think it goes against everything you will read in any book. So I would say most founders would agree that their team, their people are the most important asset. And if you can't make sure to hire and retain and enable a great team, you will basically not be successful. While saying that people related topics always fall short because there are more urgent topics on the founder's plate. If it's sales, if it's investor relation, if it's onboarding, a customer fixing, single bar, whatever. And I made this experience before, so what we wanted to make sure that whatever comes, whatever the me and my co founder will be busy with or think that is more important than people topics. We have someone that is super passionate and skilled about making sure to identify and hire and retain the best talent out there and create a great performance culture at cello. Because even though I want to do it after doing it my second time, I'm self reflected enough that it won't work like this. So therefore we decided very early on to hire Filip as head of people with a special profile though. So Philip is an amazing generalist with a T shape and a strong skill set in the people area. But he's also in times where we for example, don't hire people or don't have enough work on the people side. As for example, if you freeze hiring, for example, he's journalistic enough that he helps out in other areas, which I think is also an important part of the story. But therefore we can make sure that everything around people is just at the highest possible bar we can think of. And I think this is like we believe this is really paying off. But on the other side he can also give hands in other areas where he's supporting and even owning a whole.

[Omar Khan]

Other areas that makes a lot more sense. I mean the idea of a team of three and you've got a head of people who is there enough for that person to be doing at that point. Unless you're hiring hundreds of people. That makes more sense. Okay, let's wrap up. Let's get seven quick fire questions for you. Just try to answer them as quickly as you can. You ready? Sure.

[Stefan Bader]

Let's do it.

[Omar Khan]

What's one of the best pieces of business advice you've received?

[Stefan Bader]

I think I go with an old school advice. Do things that don't scale. That helped us a lot in the past.

[Omar Khan]

Or actually in your case, do the things that need to scale and also do things that don't scale. Right.

[Stefan Bader]

Pick your battles.

[Omar Khan]

Yeah. What book would you recommend to our audience and why?

[Stefan Bader]

For everything getting into go to market. And for me becoming CRO, I picked the acceleration formula from Marco Bersch. Big fan. And I think generally for managers, multipliers.

[Omar Khan]

Right. What's one attribute or characteristic in your mind of a successful founder?

[Stefan Bader]

I would pick perseverance, but I think it's being mentioned too often, so I would go with having a reality distortion field.

[Omar Khan]

I love that. I love that. I think we need more of that. In many ways, I think as founders, you try to be such realist that you talk yourself out of some of these crazy things.

[Stefan Bader]

Right.

[Omar Khan]

What's your favorite personal productivity tool or habit walking meetings.

[Stefan Bader]

So if you don't need a screen, do it at least once a day. Leave the house and do that just while walking. It's like active recovery.

[Omar Khan]

What's a new or crazy business idea you'd love to pursue if you had the time?

[Stefan Bader]

LLM SEO.

[Omar Khan]

There's a lot of conversations going on about that right now.

[Stefan Bader]

Yeah, I think it's a hot topic.

[Omar Khan]

What's an interesting or fun fact about you that most people don't know?

[Stefan Bader]

Starting my first company, my entrepreneurship professor wanted to talk me out of continuing and building the business, which is odd. It's like 12 years ago, things have changed. But yeah, I thought, you know, never mind. I just keep going.

[Omar Khan]

And finally, what's one of your most important passions outside of your work?

[Stefan Bader]

I'm big football fan, so. Yeah. Follow Bistrutka. If anyone has heard that football club before.

[Omar Khan]

Awesome. Stefan, thank you so much for joining me. It's been a pleasure. If people want to check out cello, they can go to cello. So. And if folks want to get in touch with you, what's the best way for them to do that?

[Stefan Bader]

LinkedIn.

[Omar Khan]

Great. We'll include a link to your profile in the show notes. Awesome. Thank you so much. I appreciate you taking the time to chat and sharing some of the lessons and struggles that you've kind of experienced along the way of building this business. Hopefully we provided some some other founders with some ideas, some insights, some inspiration to go and apply to their own business. And I wish you and the team the best of success.

[Stefan Bader]

Thanks Omar. Thanks for having me.

[Omar Khan]

My pleasure. Cheers.