From logistics to SaaS - scaling tech ops with Squared

In this episode, Rayan Bannai, founder of Squared, talks about his background in logistics and how he left the industry to start Squared, a process operations design agency that helps tech companies scale their operations. Squared is an on-demand platform that allows businesses to use them in a plug-and-play manner.

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Read the transcript:

Charles Brecque: Welcome to the Tech Story podcast, a place where we interview founders and people in tech who are building exciting businesses. Today. I'm excited to welcome Rayan Bannai on the show. Rayan is the founder of Squared, a company which helps tech companies scale their operations. Rayanne, thank you for taking the time to be with us. Would you like to please share a bit of background about yourself and your company?

Rayan Bannai: Thank you Charles, for having me. My journey starts in Bahrain, that’s originally where I'm from. I grew up there and one of my first areas of career was going into logistics, so very far away from where we are today doing inbound logistics. I was at airports waiting for containers coming from La and then about eight years ago or so I moved to the UK. I went into subscriptions and fulfillment, eventually into sustainable logistics, almost like ironically trying to make back all the emissions that I created in the first place, which was a really interesting sort of world to be in, accelerated by the pandemic within sort of cargo bike logistics. And today we see them sort of all over the cities, particularly in Europe. And over a year ago I left that sort of world, which was a very tough operations world when it came to margins and processes and sort of touch points and you're really battling for 3% -4% margin. When I left that world, I thought, there are a lot of things that we can take from my experience there, but also that industry and apply it to all sorts of businesses. Understanding how we can take processes, the way we scale, the way we grow and apply that methodology of reducing touch points, but also increasing and improving experience from a client and consumer perspective in the same way that we would apply that logic to a parcel or delivery. So I had started Squared and we are essentially a process operations design agency where we design and implement processes for businesses. We are an on demand platform which allows businesses to use us in quite a plug and play manner as they wish. And we've seen this as a really good sweet spot for businesses that don't necessarily know exactly the direction that they want to go with their operational strategy, but also allows them to stop and scale depending on where they are in their fundraising journal. So that's where we are today.

Charles Brecque: Really exciting. And you mentioned in the world of logistics, you're fighting for three 4% margins. Can you share maybe some of the challenges with the industry? And I guess a follow up question is can it really be sustainable?

Rayan Bannai: Yeah, great questions. I think the first part is logistics as a whole area is fundamentally still quite fragmented and quite broken. The reliance on humans and people is still very high and with rising wages and costs globally, that's reflecting directly on the cost and the way things are operated. Unfortunately, at the same time whilst those costs are rising, the demand in terms of how much people are willing to pay is also going down. So we've got a disconnect there already and that's inevitably coming at the cost of those people that are delivering to our doors day in, day out. So because we're still so reliant in that industry on people, we're seeing a knock on effect on the declining experience. It's one of the lowest MPs industries basically around. Right? And we've all experienced what a bad delivery is like or even a missed delivery. Sustainability, it's an interesting one. I've kind of seen and witnessed both sides of it where there are businesses like the ones that are involved in that are actively trying to change the mentality of big corporations, big establishments and what that actually means from a sort of supply chain perspective. But it took a long time to actually get there because the reality is it was still down to cost. And when you posed the question, how much do you actually care about being sustainable, having green credentials when it comes to delivery? Fortunately for a long time, and still is, the answer was cost first, sustainability next. So we are getting there and consumer demands are changing. There's just not yet enough sort of governmental push or laws or regulations which say, no, this is how you have to operate. And unfortunately, I think that's what we will have to get to until there's a real big change.

Charles Brecque: Thank you for sharing. The insight. Feels like I've just had a master class in logistics and operations and I guess that's something which we take for granted is for something to go from A to B because the world is complex and A to B can mean many things. You do generally rely on humans and humans need to be paid especially, I guess with the cost of living going up, that increases the cost of humans. So totally understand why there's that disconnect. And I guess companies like Amazon with Prime making delivery free also doesn't help. Also with those consumers, just business expectations that delivery should be free. But great. Thank you for sharing. And I guess what's the sort of way you go from this industry to starting Squared? What was the insight or what was the insight behind starting a new company?

Rayan Bannai: Yeah, I think, again, taking away some of those fundamentals that I really picked up and learned from logistics is when we empowered couriers and we trained them well and we paid them well and we treated them well as well, it had a really positive impact on the overall efficiency. But really importantly, the client experience that we received as a business. And so when I take that principle of people efficiency and processes and we bring it to today into the work that we do as squared in executing and delivering processes for tech businesses, our goal is not to create hyper operational efficiency out of every single process in a business. Our goal is to be able to, yes, create a level of efficiency, but make sure that it's complemented and married up very well with the people's experience and the culture that comes out of it. We can create a sales process, for example, which is extremely efficient, which is hyper automated and very task based for a sales rep. However, if their role and their task is extremely mundane, all you're doing is essentially creating a consequential KPI somewhere else in your business, which is sales retention or people retention of that person, the culture and inevitably where your business may end up. And so we very much look at all the consequences of all the actions that we make and really want to create a sustainable culture within businesses based on the operational changes that we make alongside businesses.

Charles Brecque: Exciting. And so what do you wish you had known before starting squared?

Rayan Bannai: I think although I've sort of had businesses in the past within the logistics industry and sort of grown as businesses, I think you learn a lot of things and you don't make those mistakes again. But at the same time, going into this business where we are positioned more as a platform and almost SaaS based business, it's trying to really dig into understanding the true pain and the problems. One of the things that has taken us a good amount of time to really get to is understanding how to best position ourselves as a business, to really get into the pain points of other founders and other earlier stage sort of businesses. The educational curve as well as being able to think about what do people understand from the word operations? For example, what is your idea, what is your perception of the word operations? So I wish I had that sort of magic answer before we started, which was what is that one sort of common or one or two common sentences that if I said to someone everyone would sort of understand? Yes, I totally get that it's taken us some time to get to that point but I think we're really sort of hitting that at the moment.

Charles Brecque: Yeah, I agree. I mean, operations can mean many things to many people. And ultimately, when you are prospecting or looking to establish new relationships, it's all about the messaging. And different messaging will resonate with different companies or different personas. And ultimately, as long as you're updating or iterating on that messaging 1% every single time you do eventually end up in the right place. And what's been your favorite moment so far?

Rayan Bannai: I think hiring someone was the first moment where I felt a level of comfort, excitement as well towards there is potentially more to this. When you start up a business initially on your own, it's quite lonely, particularly if you're a solo founder, you are effectively trying to find all the answers on your own. It's very difficult to find specific people that you can completely trust and engage with even if they're sort of your closest relations, of course, because sometimes they don't tell you what you should hear, rather what they think you want to hear. Right. So hiring that first person was a really key moment for me because it allowed me to really be honest and transparent with somebody and them to also be honest and transparent back with me. It also gave me a sense of direction and responsibility. The dynamic changed from what effectively was me being an independent consultant, if you like, to an actual business that had to deliver for many reasons. I think that was very much a game changing moment for me in the last year.

Charles Brecque: The first hire is always special and you might not get it right, but I guess it definitely feels like going from being a consultant or being just someone who's CEO of a one person company to actually having a proper business. So congrats.

Rayan Bannai: Thank you.

Charles Brecque: And you've been doing this, I guess for just over a year. What's the vision for the next three, five years?

Rayan Bannai: I think we are very much understanding of the fact that we live in a world where we have to empower our people to make the right decisions and choices and actions but very much understand and appreciate that technology is not going to just let that happen on its own. And so for us as a business today, the primary factor that we're trying to do is really understand and achieve an understanding of what our business is fundamentally needing to do more of. How can we increase their productivity? And in the next sort of twelve to 18 months we are looking to try and build a SaaS platform which would both act as our core product but also be attached to a human on the other end of it that can still augment the experience that another business could have in engaging with our product. So we really understand and appreciate where technology is going to play its part. We don't feel that all of it needs to be done by people, by humans. But what we do appreciate is that people still like people and as much as you can throw an AI platform and so forth in front of it, there has to be something that engages particularly in obviously our use case in our product here.

Charles Brecque: Yeah, I like using the agency to then build the product I think is something which isn't something we've done legislate. But I know there are many successful businesses that have and I guess it's a great way to fund product development because it's easier to sell. I wouldn't say it's easier, but I guess some clients are more comfortable purchasing a service than purchasing a product. Because there is that human element of at least with the human you can make sure that you're getting what you're getting or supposed to get worse versus a product which might require completely reengineering so that it sort of meets your needs. And it might be possible, it might not. But there's that uncertainty.

Rayan Bannai: Absolutely. And if I add to that as well, when you have that model and I somewhat pivot, I guess, into a SaaS, you have built a product based on demanding, paying customers who are telling you exactly what they want on a day to day, week to week basis. And so you're really well positioned as a business to sort of make that pivot in the longer term. It still of course comes with its challenges. You are changing and I think the important thing is then managing if you do shift that dynamic that you don't leave those customers who were your first sort of adopters, early adopters of your business or your product behind and making sure that they really continue to get more and more value from what you're developing.

Charles Brecque: Absolutely. And so when can we expect SaaS?

Rayan Bannai: Ideally in twelve months' time, but I expect that sort of by the end of this year we will start to have an early kind of MVP in which we will slowly transition elements of our product. So today all our clients have access to a dashboard in which they engage and interact with it's all developed through no code. And at the moment the technology that we're using internally is for us to be able to understand and learn how we can create internal efficiencies. And across the next twelve months what we're effectively doing as this platform is to be able to transfer those efficiencies back to our customers and for them to be able to have that gain rather than us.

Charles Brecque: It's really exciting. And talking of technology, what's your favorite tech product?

Rayan Bannai: Is this a hardware or software question?

Charles Brecque: Can be both.

Rayan Bannai: I have to say I am quite a, quite a basic tech user when it comes to things and very little I suppose is needed to kind of meet and exceed my expectations. I think from a business productivity perspective we're very notion centric. Basically our operating system is a notion that's where we go in the morning to start our day, to understand what our week ahead looks like. Since I mentioned it. Hardware. I am just a massive fan of the Apple ecosystem as a whole, I have been for over a decade now and I just think that the experience that you get from that type of hardware in which everything is pretty asynchronous and just works is something that I have never been able to go away, get away from. And it's nothing against Android or any Android fans, but that's just me and sort of the preference I've had.

Charles Brecque: Yeah, I definitely consider myself an Apple geek as well. But after watching a few Korean dramas where there's a lot of product placement, I did start to think, oh, those Samsung phones look quite good but I haven't. You can't really justify having two smartphones, but it is very tempting. And as a founder, busy CEO, I imagine you must come across quite a few contracts and legal documents. What are the key ones and what pain or friction can you talk about?

Rayan Bannai: Yeah, I think contracts from right from the beginning was one of the first things which sort of concerned me, I suppose, starting a business in a lot of previous roles and businesses, we have that classic, here's a template that somebody has from Once upon a time. It kind of looks right. Here it is, let's edit it and send it across to the other person. And I knew that that wasn't the route, the intelligent or wise route to go down. So I looked for solutions that would be able to provide me that. I definitely didn't have the cash to go straight to a lawyer and say, could you draft me an employment contract or a services agreement? So I looked for some platforms and digital solutions to be able to do that and that's exactly how we have continued to manage that. I my experience with contracts in the past, aside from creating them, was how on earth does someone like myself, who has little to no legal or law experience, actually look at this contract and without pretending to read it, as I think a lawyer would read it, understand it in any way, shape or form. And that is something that I still don't think we've completely solved as a business and think there's more for us to do to make sure we're pretty bulletproof on that front. But that's sort of been our route so far.

Charles Brecque: I think the education gap between the contract and the understanding is pretty big, even for people in operations or finance or people that we speak with who deal with the contracts on a daily basis. They might see the same clause over and over again. They might think they understand what it means, but in practice they don't because it means something completely different. And I guess the education piece is something we've tried to do through content on our website, whether it's the blog or on socials. But I guess through the platform it is a really difficult problem to solve and something we tried to do more so by presenting the information in the contract differently with different lenses. But yeah, it's definitely not a problem we've solved and it's a problem which, if we could solve it, then I think to a certain extent it wouldn't mean that you'd no longer need lawyers. But if you could almost automatically fill that gap, it would definitely level the playing field between non lawyers and lawyers. That'd be really interesting.

Rayan Bannai: Absolutely.

Charles Brecque: Through squared, obviously you look at processes, you identify areas which can be automated or made more efficient. What are some of the reasons why a business might want to automate a process, whether it's through standardization or a platform, whether it's, for example, Legislate for contracts or something else. For something else. Why would a business go for automation over maybe hiring a person, for example?

Rayan Bannai: Yeah, let's look at the sales or revenue process. It's definitely something that a lot of people prioritize in businesses, right? And quite often when we see businesses who say, I'm very overwhelmed because we're doing a lot of prospecting and a lot of sales, let's just say it's founders and co-founders for now don't really have a sales function. What we're seeing is you are focusing as a founder a lot of your time on all of the manual process elements of the actual sale and kind of the commercial front, as opposed to what's really valuable, which is you being on a call for 2030 minutes with your potential prospect and selling your passion, your dream, your product to them. That is the bit which you as the founder is really going to convert and turn. But instead you probably spend most of your time going through a Google Sheet or a list, a CSV, which has all of these potential emails you need to prospect and then you need to qualify every single one of them. And so one of the things we do is we look at something like that and it's not so much to alienate hiring someone, but it's more when is the right time to actually hire that person? Because if the process is mundane and a bit boring for you right now, the answer is not just bring someone else and do it. Instead, bring that person in. When that process is optimised and automated, it's fun because that person also wants to come in and sell the dream, the passion of why you should use this platform. So we go back to that sales process. We would as squared look at each part of that funnel. Where are the inefficiencies? What are the touch points? Are there parts to the client experience that we could actually reduce? Can we get to a demo or a call or a proposal even faster by being able to use platforms or tech? And when we pass that proposal stage and we come to sign, can we put a platform like Legislate within that process to make the contract signing part easier? So rather than the founder, the sales person within that funnel has to go away, create a document, make sure it's got the right details and the number of contracts I've received which don't have the right details or somebody else's company details? Can we just use a platform that can very simply achieve that, get it signed, and also reduce the friction at that point when it comes to it? And what we do is we look at those processes and think, is there anything that can enhance the experience but also reduce the friction from an eternal perspective? Once you've got that really right and you can measure it and you understand its capability, that's what we can bring to that person who's extremely passionate about your product, not the lines and lines of CSV data that they have to sit through. So that's just an example of something that we would do in a single process.

Charles Brecque: And I guess for that person that you hire, once you've optimized the process, tweaking the process because it will need tweaking or tweaking the parameters of the process is ultimately what's interesting and fun. And they can do that because of automation. Absolutely. Great piece of insight. And for the potential prospective entrepreneurs listening to this show, what one piece of advice can you give them about? For those people who are considering a path in entrepreneurship.

Rayan Bannai: You'Re going to hear this day in, day out from probably all podcasts and books and whatever, but for me, it's just always that why, which is why do you want to start this business? What is your need? What is the cause? If you are starting this for a reason, outside of that, which doesn't really completely make sense, try again and just keep coming back to that reason. And that is why until you are really solid with that reason and then get started. My only other thing alongside that is also don't wait, just get started.

Charles Brecque: You know what? No one has actually said why we've often had to do it. But I guess yeah, why would you do it? And I think if you can sort of do maybe answer why six, seven times, then I guess you've got your answer and you can go do it. Great. Well, thank you very much, Rayan, for being on the show.

Rayan Bannai: Thank you.

Charles Brecque: I'm very excited to see this software platform in the works. And yeah, best of luck growing squared.

Rayan Bannai: Thank you, Charles.

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