FF 010: Becoming Europe's Hottest Startup with Carl Waldekranz, Co-Founder and CEO @ Tictail

Carl Waldekranz is the CEO and co-founder of Tictail. With the vision of creating the worlds most used and loved e-commerce platform Tictail has been called the Tumblr of e-commerce and been celebrated as one of Europe's hottest startups. The vibrant community now hosts more than 85,000 stores on their service. Due to this phenomenal growth Tictail recently closed a $22m Series B from Balderton, Acton, Thrive and Creandum. In Today's Episode You Will Learn: 1.) What were Carl's entrepreneurial origins and how did Tictail get started? 2.) What does Carl's idea creation process look like? How does Carl brainstorm? 3.) Tictail now sells 2m products on their platform but how did they get their first customers? 4.) At what moment in the Tictail journey was Carl the most worried or frightened? 5.) What would Carl say are the essentials for funding? How did Carl meet his investors? What is the difference between the different funding rounds for startups? 6.) Why did Carl pitch other startups before pitching VCs? 7.) Question from Daniel Waterhouse @ Balderton: How has Tictail maintained the magic company culture in Sweden, whilst expanding to NY? 8.) If Carl could start his time with Tictail again, is there anything he would have done differently? Items Mentioned In Today's Show: Carl's Fave Book: The Score Takes Care of Itself, My Philosophy of Leadership by Bill Walsh Carl's Fave Blog or Newsletter: First Round Capital Blog As always you can follow Harry, The Twenty Minute VC, Carl and Tictail on Twitter right here! If you would like to see a more colourful side to Harry and a few mojito sessions, you can follow Harry on Instagram here!

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Harry Stebbings?

  You are listening to a very special episode of Founders Friday with your host, Harry Stebbings, and today we welcome the founder of one of Europe's most exciting startups. It is, of course, Carl Waldekranz. Carl is the CEO and co-founder of TikTok with the vision of creating the world's most used and loved ecommerce platform. TikTok has been called the Tumblr of ecommerce and been celebrated as one of Europe's hottest startups. The vibrant community now hosts more than 85,000 stores on their service. Due to this phenomenal growth, TikTok recently closed a 22 million Series B from Balderton, Acton, Thrive and Creandam.

• 0:42Harry Stebbings?

  Prior to TikTok, Carl co-founded and sold a digital agency called Super Strikers, where he was a art director who helped develop the brand identity for companies such as Spotify, Rap and Bamboosa, together with co-founder Kaz Drogan. Carl also founded Keyflow, a mobile guest list app company. But before we dive into today's amazing interview with Carl, Jim Collins, the writer of Good to Great, said, “People are not the most important asset, the right people are.” And hiring that right person is very difficult. However, this process is made all the more simple using HiringScreen, which analyzes your requirements and compiles a shortlist of the best candidates using their Blink

• 1:27Harry Stebbings?

  algorithm. Head on over to www.hiringscreen.com to check it out. But without further ado, ladies and gentlemen, it's time to present Carl Waldekranz, co-founder and CEO at TikTok.

• 1:45Speaker 01

  You have now arrived at your destination.

• 1:49Harry Stebbings?

  Carl, welcome to Founders Friday. I'm delighted to have you on the show.

• 1:53Speaker 02

  Delighted to be on the show, Harry.

• 1:55Harry Stebbings?

  Now, I'd love to kick off today's show by hearing a little about your background and the origins of TikTok.

• 2:01Speaker 02

  Oh, sure, of course. Um, well, I started my career in in design, actually. I started a small little boutique agency together with one of my current co-founders, Kai, back in, I guess that was two thousand and six. Uh, we ran a pretty scrappy operation. We had a small office in a basement outside of the city centre in Stockholm, uh, where I'm from. Uh, but but we ran into a fair amount of luck. One of our first customers was this tiny startup at the time, twelve people, small, called Spotify.

• 2:34Harry Stebbings?

  Oh, a small company, yeah.

• 2:36Speaker 02

  They they they hadn't quite launched yet. They had this really exciting vision, this really cool product, beta uh product. Uh, and well, of course, like a really promising future ahead of them. But they were looking for a small kind of scrappy startup agency that could be kind of their extended marketing department, help them out with things like videos and the website. Then things that they didn't have time to because time to think about because they were focusing on far more important things then. Uh, and and that agency happened to become Super Strikers, our little boutique. Uh, and and and from that point then forward, we became this extremely startup tech-focused company. Uh, worked with Spotify from the launch in Sweden all the way to the launch in the U S.

• 3:20Speaker 02

  Five or six years later, uh, started working with Rosetta Stone here in the U S. And with Nokia, that was still a cool company at the time. Uh, and then in two thousand and nine, we were acquired by this bigger agency called Identity Works. And and and that's really where I started thinking more about next steps and and what I wanted to do. Um. Ha I'm working a bunch with different e-commerce clients. Um, was really excited about the e-commerce space. As a designer, it's one of those few areas where kind of like your input and and impact uh correlate.

• 3:59Harry Stebbings?

  Absolutely.

• 4:01Speaker 02

  As a designer, you create logo types and branding and things like that and and it all looks beautiful and and you feel good about it. But it's really hard to see how it affects the bottom line, like how it really drives revenue or users for a company. In in in e-commerce, it's a bit different, like you see how every change you make has this huge incredible impact on on the on the sales or the visitors and so forth, and and and that was really exciting.

• 4:26Harry Stebbings?

  And so you're attracted to the e-commerce and how did you actually get the ball rolling then on Tictail? Did you use, you know, did you bootstrap with your co-founder? Did you have offices? How did it all start?

• 4:40Speaker 02

  No, sure. Um, well, it started one night. We were working super late in the office. I think it was like two or three A M. And I just told Kai, look, I want to do something else. I want to build a product. I want to invest my life into something that is longer term, a company where I can see myself work, not for the next year or two, but for the next ten years. And and I want to work on something that that has this impact on on the world around us and I want to work together with with you. And and then that kind of like started a conversation between the two of us. Where we we didn't know exactly what Tictail was or what it was supposed to become. We just knew that we wanted to build a business and we wanted to build a company that was like had a long-term perspective.

• 5:25Harry Stebbings?

  Absolutely.

• 5:26Speaker 02

  So so we started shooting like text messages back and forth and we did this exercise, you know, when you kind of like take an existing company and you apply it to a new category like uh let's create Facebook for dogs or let's create like Meetup for cats, like you you'll just like take things that exist and apply it to something else. And and I think like there's this belief amongst people that like building a startup or building a company, you're supposed to have this eureka moment. This idea that no one has ever thought of that just came to you. And and that's when you can start a business. And and I actually think that like coming up with a a company idea, something worth pursuing.

• 6:08Speaker 02

  It doesn't have to happen that way, like that creative process can be much more kind of like planned or defined. And and and something that is like an activity that you schedule time to do. And and and because that was actually how we came up with the idea of Tictail. I think one of those text messages. Ended up saying something like, let's create Tumblr for e-commerce. And and that kind of started a conversation that that would later become, I mean, Tictail.

• 6:38Harry Stebbings?

  And how do you like to brainstorm then? Do you like, do you like to do it with, you know, your, your friends and with a big whiteboard in front of you type thing? Or do you do it on the move, on the go? What do you, what's your idea creation like?

• 6:53Speaker 02

  That's a really interesting question. Um, I, I, I think I would say two things. Uh, the one thing is that I think brainstorms work best when they're spread out over, over a time period.

• 7:06Harry Stebbings?

  Okay.

• 7:06Speaker 02

  I just find it really valuable that like as you come up with different ideas or different directions to let those digest for a day or two. And then come back and continue the brainstorm because as you're kind of not thinking about it. Your brain is actually doing all of this work in the background and and the ideas that you discuss in spur of the moment, they, they're allowed to be developed and nurtured. And and then the second thing I would just say is that like. Create a structured form of brainstorming and this is something you, you learn when you work at an agency for a few years. Uh, I, I, I love the concept of just working a lot with post-it notes.

• 7:47Speaker 02

  And and just sort of like having different themes, like let's output as many ideas as we can in less than five minutes. And after that, like, let's output the worst ideas we can come up with in five minutes. And then let's spend five minutes in trying to reverse all of the really bad ideas we had and trying to turn them into good ones in less than five minutes. And and you kind of like have this like high intensity, high intensity, high frequency, like output exercises. And you just put up like hundreds of post-it notes in, in clusters or groups on a wall. And and that sometimes allows you to see this like bigger patterns, these sort of like bigger trends that that you're thinking about. And and based off those clusters have more informed or, or interesting conversations.

• 8:32Harry Stebbings?

  And Tictail now has how many e-commerce sites on its servers?

• 8:37Speaker 02

  We have more than eighty five thousand brands.

• 8:40Harry Stebbings?

  Eighty five.

• 8:40Speaker 02

  Across one hundred, yeah, no, it's incredible. Together, they sell more than two million unique products. They're spread across one hundred and forty markets, although our our growth is concentrated to five markets, Sweden, the UK, Germany, France, and and of course, the US are fastest growing markets.

• 9:01Harry Stebbings?

  And that's absolutely astonishing growth and just unbelievable. I mean, congratulations to you on that. But how did you get your first customers?

• 9:10Speaker 02

  The first customer, of course, was my mother.

• 9:16Harry Stebbings?

  The first listener to this show was my mother, too.

• 9:19Speaker 02

  Well, that that's that's how it should be, right?

• 9:21Harry Stebbings?

  Absolutely.

• 9:22Speaker 02

  I often go with the team that the day my mother turns from the platform is the day I I should be fired as CEO of this company.

• 9:31Harry Stebbings?

  What did she sell on the platform?

• 9:34Speaker 02

  She she runs this brand called Baimuti. You can find it on baimuti.tiktail.com.

• 9:39Harry Stebbings?

  And the link will be in the show notes, just to let you know.

• 9:43Speaker 02

  It's wonderful. She sells this this beautiful porcelain. It's traditional Chinese porcelain, but it's updated with sort of like a more up to date, artful design, actually with old school sailor tattoos painted on the porcelain. It it sounds a bit quirky, but I assure you it's it's worth the visit.

• 10:03Harry Stebbings?

  So she was your first customer. And and then how did you expand from there? Was it a word of mouth? Did you do online marketing?

• 10:11Speaker 02

  Oh, sure. So the the launch event of Tictail was actually this big e-commerce conference called the Nordic E-Commerce Summit. And we were able to strike a deal with them. They bring together about two thousand people in the industry to hear about sort of like the latest trends in in e-commerce. And and I went to the person organizing the event and I said, look. If you let us present, I'll make sure that we launch on the day of the event. In fact, I'm going to make sure that we set up a timer on our website, counting down to the moment we go up on stage and present. So that the service actually goes live at the same time that we go up on stage.

• 10:55Harry Stebbings?

  Good sound.

• 10:55Speaker 02

  She, she agreed uh to have us on stage to present the service as it was going live. The, the second pitch I, I had to make was to my team members. Coming back from that meeting saying, look, guys, I have some good news and I have some bad news. Uh, we, we're allowed to present on stage for the Nordic E-commerce Summit. Uh, we need to create a countdown on our we- website. And we need to go live with the service on this specific time.

• 11:24Speaker 02

  Uh.

• 11:24Harry Stebbings?

  What was that?

• 11:25Speaker 02

  And this was a

• 11:27Speaker 02

  an incredibly tough deadline to reach. I think at the time, we were six or seven people working at Tictel. And, and we all just brought like air mattresses into the office and were literally twenty-four hour shifts for two weeks, just cranking out the first version of the platform. Uh, I, I remember going into the cab to go to the conference to go up on stage to present. As William, one of our engineers, was still deploying code that was crucial for the site to work. Uh, going up on stage, I hadn't yet received confirmation that the site would actually work. When I was supposed to sort of like demo it live in front of this audience, two thousand people, uh, extremely nervous.

• 12:12Speaker 02

  But, but it all turned out really, really well.

• 12:15Harry Stebbings?

  And in the whole Tictel process then, with, with, with that moment in mind, what moment would you say has been the most nerve-wracking or frightening? Was it that moment or expanding to new continents or what was it for you that really worried you?

• 12:30Speaker 02

  Wow, that's a great question. I think it's like different things were you in different ways. Such like that moment was just incredibly nerve wracking.

• 12:40Harry Stebbings?

  I'm sure.

• 12:42Speaker 02

  And and and probably like, I've probably never felt like as stressed out and excited and just like energized as I did when I when I walked up on that stage. But then there's been like a a lot of other moments like that one following the sort of like growth of TikTok. Like I remember pitching a V C for the first time. And just how nervous I was to go into that room and present that deck and present my vision and this thing that I've been spending so much time working and thinking about. O- only to have it be like criticized or or the like judged by this. Like really, in my mind, important person that that seems to know everything about startups and technology.

• 13:26Harry Stebbings?

  And so let let I, you know, obviously I love V C, so I'd love to hear more about that. So when you went in, what what did you have? Did you have a pitch deck and the product? What essentials would you say there are for founders entering a round of funding?

• 13:41Speaker 02

  Sure, um, the first pitch that we had was terrible. It was like sixty slides, it had, it took like an hour to go through. And and and it talked about all of the things that TikTok could become. It was just like, it was such a visionary, like naive, we're going to take over the world type of deck, but it's completely lost. The sense of sort of like identifying the smallest possible problem and and showing like diligence and focus in in how we approach that that problem. So so as sort of like the weeks went by and we did like a lot of practice pitching.

• 14:24Speaker 02

  Uh, with friends, the people in the industry and people that worked at other companies. The pres- presentation was cut down from maybe sixty slides to to only ten slides. Uh, when when we started doing like live V C pitching. Uh, and and I think that's like the first advice, like whenever you think that you've like made a deck smaller or more condensed, like remove another two slides. Because as it turns out, the the purpose of a deck is not to answer all questions about a business. It's to create ground for like interesting discussions to come. Like VCs in general are are interested people and and they want to be curious at the end of a presentation.

• 15:08Speaker 02

  They want to have some questions to ask, they want to engage in conversation. And and I think the best pitch decks do that, that they they trigger excitement. But but they they leave things for the discussions to come.

• 15:21Harry Stebbings?

  And how did those first investor meetings go then?

• 15:25Speaker 02

  I I I mean, I I would say that the first ones were just complaining. Uh, I I feel thankful for all the all of the people that that took the time to to meet us then. But I think that we were just such a me- mess.

• 15:38Harry Stebbings?

  To be fair, you have raised investment from some incredible people now, though. With with Balderson and legends like Klaus Hummels. How did you meet those people?

• 15:50Speaker 02

  Well, I feel extremely lucky to have uh come to know like some really great entrepreneurs and and people that work at other startups. Uh, that that were able to give us advice and support and mentorship as needed to kind of like develop our pitch and and develop the presentation of Tictail to better reflect like the the opportunity and and and how we would actually be running the business. And it was actually also through these people that that we were introduced to to these great investors, people like uh, well, the the partnership at Volaton or Klaus Hummels. So so what we did when we started pitching and we were supposed to go out and raise our our seed round.

• 16:33Speaker 02

  We started by pitching other startups. And we would just contact other startups and and their founders and say like, hey, we're we're a startup as well, we have this pitch, uh, would you please find like um thirty minutes or forty minutes from your busy schedule and give us some feedback on our pitch? And then, once we pitched them and they were giving some feedback, if they seemed excited about our opportunity, we would also ask them to introduce us to their investors. It's it's it's pretty good because once you get those introductions, you actually get introductions from startups that these VCs have already invested in and of course, for that reason, already uh trust and believe in.

• 17:19Speaker 02

  And I think it's one of the most relevant introductions you can get to to a VC.

• 17:23Harry Stebbings?

  And you recently raised twenty two million in VC funding, so huge congratulations for that. But and have you found that the the rounds have got easier as they've gone on?

• 17:35Speaker 02

  No, just very different.

• 17:37Harry Stebbings?

  Very different. How are they different?

• 17:38Speaker 02

  Yeah, very different. Well, they're they're different in the way that you're you're pitching completely different things like when we went out and raised the series C, we had a ten slide long uh pitch deck and it was all about the team, the product and the vision. As you go on to raise a series B and you go out and raise twenty times as much as you did in in your series C, then the pitch deck changes. It's much more about the data points, how they've been changing over time, different certain initiatives on the product development side that that have like immediately had a positive or or negative impact on on on your KPIs. Like the story you're telling

• 18:23Speaker 02

  still has a foundation in like the vision and the long term opportunity, but it's much, much, much more based on data.

• 18:31Harry Stebbings?

  And then saying you were going back five years or to the start of Tic-Tail again, is there anything you'd do differently?

• 18:40Speaker 02

  Um.

• 18:43Speaker 02

  Well, if I would know what Tic-Tail would become, I mean, the the easiest answer is that I would have moved faster. I've been would have been braver. I would have been more aggressive.

• 18:53Harry Stebbings?

  And where did you move you move to Silicon Valley? Or to New York?

• 18:57Speaker 02

  Well, we started off, yeah, we started off. All the way back to when we started the company, we we started off by going over to Silicon Valley and we spent about a month there. Only to decide to move the operations back to Stockholm. Uh we simply realised that the advantages of being in Silicon Valley, close to all of these investors. Were outweighed by the advantages of being in a city where we have an amazing network. And we have access to this incredible pool of freely talented engineers and designers. So so so we kind of like decided to opt for for people versus location.

• 19:38Harry Stebbings?

  And and Daniel Waterhouse at Balderson, actually, I asked him for his advice on before this interview, just for maybe questions to ask. And he wanted to know that you've built a team so successfully in New York, but you've managed to retain the magic in Sweden as well. How have you managed to create this brilliant company culture in Sweden and have it retained when you expand to New York?

• 20:04Speaker 02

  Oh, that's a generous question. Uh well, thank you for for complimenting on our company culture. I think that one of the key parts of it has been to. One, make sure that communications is prioritised and invested in. That means that every new hire in the New York office is on boarded for one or two weeks in the Stockholm office. So that they can really kind of like understand our culture, our history, our vision, wha- what the company is based upon. During these onboarding weeks, we have like a packed schedule of like different key stakeholders within the company. That do a full presentation and story about like how.

• 20:48Speaker 02

  What they work on within Tictail, how the scope of their work has changed over time. Why they started the company, what they're excited about in the company. So after that kind of like onboarding course. You're one hundred percent kind of up to speed on everything that has happened, that is happening. And and where we're planning to go.

• 21:10Speaker 02

  The second part, of course, is that we we put in place this sort of like knowledge or like transfer programme between the offices. So if anyone in the Stockholm or New York office wants to go to the to the other office to work, we will sponsor that trip entirely, whenever they want, for for whichever reason. We also plan to have two company-wide offsites every year. So every, the entire company, twice a year, goes on this trip to to different destinations where we get to have like fifty percent of of work and and fifty percent of just sort of like fun and games. So, for instance, the last meet trip we did was to Iceland. And and we had like a day and a

• 21:54Speaker 02

  half where we just like spent time workshopping in teams and talking about the future of the company. And then we had a day and a half where we just like discovered Iceland and saw all of these like really cool, really cool destinations.

• 22:07Harry Stebbings?

  Wow, uh, where where do I sign up for Tiptoe?

• 22:11Harry Stebbings?

  That sounds fantastic. Um, and and if it's okay with you, we're gonna move into a quickfire round now.

• 22:18Speaker 02

  Yeah, sure.

• 22:19Harry Stebbings?

  So your favourite book and why?

• 22:23Speaker 02

  Um, I I I think that your taste in books and your favourite book changes fast because it's like they they mean different things to you at different times. One of my most recent favourites is Score Takes Care Of Itself by Bill Walsh. And and it's actually a book about um, one of sort of the NFL's greatest, greatest coach, uh, coaches, and and kind of the things that he learns about coaching teams. And and and as it turns out, there's a lot of similarities to to the things that he learned to the things that you experience as you're kind of like building a company and and you're you're building a team.

• 23:06Harry Stebbings?

  And then which founders you most look to emulate?

• 23:11Speaker 02

  I don't think I actively tried to emulate any founder. But from what I read and understand, I think the approach that that Mark Zuckerberg has taken to to to really build an organisation where where innovation can come from anyone is is something that I'm deeply inspired by.

• 23:30Harry Stebbings?

  Your most read blog or newsletter?

• 23:34Speaker 02

  Uh I I think that the first round capital newsletter, the email they send out.

• 23:38Harry Stebbings?

  Mm hmm.

• 23:39Speaker 02

  It is is is really amazing. They bring together different entrepreneurs that they have back. That write newsletters on on completely different topics, but they're they're always really, really on point.

• 23:49Harry Stebbings?

  And then other than Tictail, obviously, your must have apps or software?

• 23:56Speaker 02

  Well, I'm I'm becoming an increasingly big fan of of of the latest software coming out from Google. I'm I I wouldn't be able to live without Google inbox or Google Photos for that matter.

• 24:08Harry Stebbings?

  And then finally, the next five years for you and for Tictail?

• 24:14Speaker 02

  Well, that's probably like the hardest question. I think for for Tictail, it's it's all about sort of like transitioning into becoming a consumer destination, like really becoming the home to the world's greatest independent brands from all over the world. It's about global expansion, uh increasing our presence in in more and more markets, uh uh and everything's of course driven by mobile.

• 24:38Harry Stebbings?

  Absolutely.

• 24:38Speaker 02

  Uh for me personally, I'd love to just continue to develop with this exciting company with my fantastic team. And and just follow as as Tictail goes from being kind of like a backend, a tool for for sellers to becoming this sort of like fantastic community of of creativity and and entrepreneurship. It's it's a really exciting journey to be on.

• 25:02Harry Stebbings?

  Well, Carl, it's been absolutely fantastic to have you on the show and it's been such an inspiration to hear you talk about Tictail. Thank you so much for joining us.

• 25:12Harry Stebbings?

  What an inspirational interview from one of Europe's most exciting founders. And for all the items and resources mentioned in today's incredible show with Carl, head on over to the blog at www.the20minutavec.com and that will include links to Carl's mother's website on TikTok, so be sure to check that one out. But before we leave today's show, in the episode with Carl, we spoke about creating a great company culture and how to create a united workforce. Well, look no further than HiringScreen, who have the ability to turn 200 CVs into a really concise shortlist of candidates, all analysed according to their incredible Blink algorithm.

• 25:54Harry Stebbings?

  It's a must check out, I've used it myself personally and it saved me hours and hours of time sifting through CVs. So do check them out at www.hiringscreen.com or you can tweet them at @hiringscreenRH. Thank you so much as always for your continued support and we can't wait to see you in the next episode.