From dog toys to SaaS software: How Lettuce’s founder learned the art of product management

By Michael Carney , written on March 13, 2014

From The News Desk

Product management rarely gets its due outside the startup community. It’s not uncommon for first time entrepreneurs, particularly non-technical ones, to cite the PM role as the position they’ll fill on their team’s early organization chart. But nebulous as the job description may be, product management requires a synthesis of seemingly incompatible skill sets. The good ones are part engineer, part designer, part sales, and 100 percent OCD. Project management can’t be faked, but can it be learned?

To answer this question, I sat down with Raad Mobrem, co-founder and CEO of SMB (small- and mid-size business) order management startup Lettuce. On the surface, Mobrem may not seem like an obvious choice for the PM of a SaaS startup, but he’s been almost solely responsible for the company’s product since its earliest days. He’s not a coder or a designer, by training. Instead, he got his degree in Mechanical Engineering. Prior to Lettuce, Mobrem was building a dog toy business that ultimately sold for a few hundred thousand dollars, but not before incubating Lettuce as an internal productivity tool.

Since the launch of its first commercial product, Lettuce has held user experience simplicity and beautiful design as core tenets of its brand. Walk into the company’s Venice Beach office – which, it’s worth mentioning, is an airy, beachfront Frank Gehry-designed live/work space that Mobrem doesn’t hesitate to use as a recruiting tool – and the first thing you see is a giant sign reading “Design + Technology = Greatness.”

Lettuce users have always reacted positively to the product’s design, Mobrem says, but a nice coat of paint alone wasn’t enough, and finding product market fit wasn’t as immediate as he would have liked. The challenge, it seems, was a conflict between delivering simplicity and the need to offer full functionality to solve the multitude of problems facing the typical SMB.

“Lean methodology did not work for our startup – our MVP wasn’t really that minimal,” Mobrem says. “We were 90 percent through our core-feature list and maybe 40 percent through our nice-to-have list before we really had product-market fit. We’ve been able to run small tests since finding product market fit, but there were a lot of features that were required within our product in order to make it useful. Like any company, we’ve had to prioritize and to maintain our focus on delivering simplicity.”

One of Mobrem’s biggest advantages, in his estimation, is that he’s previously run a small business and initially designed Lettuce to solve his own problems. This led to several not-so-obvious realizations that shaped the product roadmap. One example is that customers need the ability to generate multiple invoices from within a single order, and then sync those invoices back to Quickbooks. The same is true of the need for wholesale customers to have a standalone iPad app for viewing inventory and placing orders. No other SMB order management product on the market offers this, according to Mobrem.

“A lot of our competitors are glorified Excel sheets,” he says. “We’ve really focused on automating as much as possible, while still offering transparency into what’s being done in the background.”

There’s no right way to design software products. For example, Mobrem takes issues with the mantra that reducing clicks inevitably makes software better.

“A lot of people mistake reducing clicks for increased simplicity and intuitiveness,” he says. “We’ve found that’s not always true. For us, design boils down to visual appeal and product flow. Sometimes, adding an extra click that helps the user understand what’s happening and why is helpful. A lot of the things that we as operators had to learn the hard way with our prior business, we can help educate our users on through smart design.”

With the product finally where he feels it needs to be, Mobrem is turning at least one eye toward growth. His first initiative was to revamp the company’s marketing website, a move that immediately increased conversions by more than 200 percent, he says. Early on, Lettuce required prospective customers to speak to a sales rep and participate in a guided demo before purchasing. Today, the process is fully automated and new customers only talk to a company representative if they have problems.

Lettuce has grown revenue between 20 to 30 percent per month since late October (a 1,700 percent annualized growth rate), when Mobrem says the company finally found product market fit. Churn is in the 2 to 4 percent per month range and continues to fall. Once a customer completes two billing cycles, it’s likely they’ll continue purchasing long-term, he says. The company now has 600 SaaS customers, a figure that has more than doubled in the last quarter alone.

The next step for Lettuce, according to Mobrem, is to build out additional integrations with other commerce-focused software tools. The ultimate goal is to see Lettuce become the “back end of commerce,” according to Mobrem, akin to an ERP 2.0 product for the SMB market.

Two and a half years in, the company now has 16 employees, consisting of six engineers, one designer, and an eight person sales and support team, in addition to Mobrem. Lettuce has raised $2.1 million to date from Crosscut Ventures, 500 Startups, Baroda Ventures, Zelkova Ventures, Double M Partners, and Launchpad LA.

It’s been a long journey to this point, but Lettuce the product and Mobrem the product manager are both more mature and battle-tested as a result.

“Any book that says ‘5 easy ways to do X,’ is a load of crap,” Mobrem says. “Doing anything worthwhile is really hard. Building Lettuce to this point has been really hard, but it’s all been necessary. We wouldn’t be where we are without walking through the fire.”