Growing a global SaaS-company out of Europe – Hartmut Hahn, CEO of Userlane

Tom Davis
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I had the good fortune to sit down this time with Hartmut Hahn the CEO and co-founder of Userlane, another one of the Microsoft for Startups Founders Hub companies. Back in 2016, Hartmut founded Userlane with Felix Eichler to provide a seamless support and training experience for large organizations who rely on their employees (and customers) learning how to work with new software and processes as speedily as possible. Based in Germany, the company has become one of the leading digital adoption platforms working with a wide range of clients, including Procter & Gamble, Deutsche Bank and others. I knew that Hartmut began his career in product and management consulting, so I was keen to understand what made him start his own company.

“It's not that you want to be an entrepreneur, it’s just something you have to do, because at some point there seems to be no other option. I remember finding corporate life exhausting, because I kept thinking about all the ideas I had and couldn’t implement. At some point I realized there was no other way for me except to embark on this journey. I believe that if you go into it thinking that it’s going to be just fun and fast money, then you’ll give up as soon as you hit the first roadblocks. It has to be something that you’re compelled to do. Once you realize that this is the only available route to happiness, you are more likely to overcome any obstacles you encounter.”

This was immediately relatable for me. I’ve heard many entrepreneurs talk about their drive to innovate and that feeling that they always needed to start their own company to fully express their sense of self. But there’s a lot of hard work to be done between having that feeling and launching a company. I asked Hartmut how he and Felix went about validating that first idea they had before founding Userlane.

“We just got out there and started selling. We built a “prototype”, which was nothing more than a click dummy and a PowerPoint presentation and started going out to companies and saying, “It’s almost ready to ship.” Then we would listen to the questions they were asking and the features they wanted, so we would know what to build in order to get someone to pay for it.

Our first customers were other startups like Celonis and Personio. Today we sell mainly to enterprises, but back at the beginning we sold to other software companies because they were very quick to give us feedback. They were fast at making go/no go decisions and they were willing to take a chance on a product that was not fully cooked. Having these kinds of customers early on allowed us to iterate very fast which is what you need in the early days of your company.

 Userlane Logo

Selling into enterprise in those early years requires a longer sales cycle and it might take much longer to get the feedback you need. We didn’t necessarily plan it this way from the start but selling to other startups helped us build a more mature, enterprise-ready product and gain some traction in the market.”

I remember building my startup in Italy 20 years ago and feeling like I may get stuck selling into the local market only. I wondered whether Hartmut had that same experience building out Userlane in Germany.

“The first five or ten customers we got were in the German ecosystem, but then we started getting attention from other countries. It was as we began selling to SaaS companies, the market was more mature in the US than in Europe so customers 11 to 15 were from outside of Germany. We considered ourselves an international company from the start. Our sales material was always in English. We only translated the website into German this year.”

I think that kind of outward-facing attitude can be important for founders from non-English-speaking countries looking to sell globally. When I ran my startup in Italy, I made it a rule early on that all communication should be in English. That’s not to put down the European market which can be very important and lucrative, but it’s about setting your business up for success beyond your local borders. I wondered what other thoughts Hartmut had about tackling the US market from the heart of Europe.

“There are some companies that have a large local component. For example, HR software needs to suit the German, Italian or US market because each market has significant differences in terms of labor legislation. We found with our solution that is about user onboarding or digital adoption, there were no regional limitations. Very early on we found ourselves competing with US products which put a lot of pressure on us and pushed us to move very fast.

Today about 20% of our revenue comes from the US market. We still don’t have a strong presence in the US, so there is plenty of potential to grow there.”

I found it inspiring that a German company could be generating a fifth of its revenue from the US. It’s a testament to the way that SaaS has changed the way business is done. I asked Hartmut if he saw the cloud-based SaaS model as key to his success.

“Absolutely. Twenty years ago, we would have had to buy servers in the US. Today we are completely on Azure and we have a data centers in the US and Europe and it’s so easily scalable both from a technical perspective, but also from a financial one.