Alex Rubalcava is a General Partner and Co-Founder of Stage Venture Partners, an L.A.-based VC firm that invests in upcoming software technologies. Stage Venture Partners is one of Balto’s lead investors. We’re really thankful for such kind words about Balto in his interview. If you would like to listen to the full podcast, the link can be found at the bottom of this post.
Jay Clouse 42:57
I feel like I would be missing an opportunity here if I didn’t give you an opportunity to share what you liked about the Balto team when you first met them, given that they’ve been on the show.
Alex Rubalcava 43:06
Absolutely. So we lead Balto’s seed round about a year ago. That investment closed in August of 2018. We were introduced to Balto by one of their advisors who happens to be in Los Angeles. And we had actually looked at a few software companies in the call center voice analytics space. And everyone that we looked at was post call analytics. They would record a call, analyze it, and then give you a report about what you said and how you did on the call. That’s nice, but that’s not really useful. It’s not real-time. It’s not synchronous. It’s the difference between a diagnosis and an autopsy. I would much rather have a diagnosis than an autopsy. And when we saw Balto, Balto had a product that was giving diagnoses. They were telling people what to do and how they were doing live on a call.
Balto also did something really effectively when they first pitched us is that they ran their software on the call. So we did a Zoom call with them, and they showed us their screen where Balto was responding to what all of us were saying and popping up suggestions and ticking off checkboxes. And when you have the confidence to demo your product like that, when you have the confidence to eat, eat your own dog food like that, boy, does that get our attention. And I mean, the swagger of that really is something that, that we enjoy.
The other thing that we liked about Balto were that they got their product out to market and in the hands of customers on almost no money. I won’t say the exact figures, but I really mean almost no money and that was actually something that concerned other venture capitalists that were looking at the deal. They said, how could this team have, you know, three founders who are under the age of 25 who had no money invested in their company get a product this good out to market and in the hands of their first five customers, when all these other startups in the space have raised 50 million bucks and don’t have anything that can make the product claims of Balto has. What I realized is that, who cares what the answer is, they’re just better. They did it. They succeeded. I did not need to take their word for it. I spoke to all the customers they had at the time. The customer said this works really well, this is increasing our revenues, and we plan to renew and to expand to more of our call center employees. So what more information do I need? That really was exceptional, the voice of the customer on, on those calls. And then since I’ve invested, the thing I admire most about Balto is that they have the most high functioning sales culture I have ever seen and that I’ve ever been a part of. They are happy warriors at sales and they take 22 year olds, 25 year olds, they take people with zero experience who come on board to be entry level sales development reps, SDRs. And they turn these people into highly effective software sales people. I think Balto is going to create a PayPa-mafia type of alumni network for enterprise software sales. They are doing something totally special. There is something special in the water over there.
Jay Clouse 46:29
That’s amazing. What a great fit for the rest of your portfolio.
Alex Rubalcava 46:33
Originally published Nov 13, 2019 7:09 pm