Asaf Darash of Regpack: Five Things You Need To Create A Highly Successful Startup

First, you need to create something in the world. Don’t do this to get rich, be a hot shot, or so people will know you. You need to do it because you want to create it. My son builds and programs these crazy robots with Legos, and my wife asks him why he doesn’t show them to someone. He says it’s because he just wanted to create it. That’s precisely the point. If you’re only creating it for the side effects that come after, you won’t hold up because it’s too hard of a journey. But if you’re passionate about what you’re doing and creating and get up every morning ready to start, you’ve done 90% of your success.

Startups have such a glamorous reputation. Companies like Facebook, Instagram, YouTube, Uber, and Airbnb once started as scrappy startups with huge dreams and tremendous obstacles.

Yet we, of course, know that most startups don’t end up as success stories. So what does a founder or a founding team need to know to create a highly successful startup?

In this series, called “Five Things You Need To Create A Highly Successful Startup,” we are talking to experienced and successful founders and business leaders who can share stories from their experiences about what it takes to create a highly successful startup.

I had the pleasure of interviewing Asaf Darash.

Asaf Darash is the founder and CEO of Regpack, an online payment management platform. With extensive experience as a developer, system architect, entrepreneur, and investor, Asaf has an innate ability to build versatile products based on achievable business models, which has helped him build three successful companies to date. He holds a Ph.D. in New Media from the Hebrew University of Jerusalem and has served as a visiting scholar at the University of California, Berkeley.

Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

The truth is I never intended to become an entrepreneur. I was set on being an academic that can research and build interesting things all day. But life has its ways, I guess. It all started with my research. When I was a Fulbright scholar at Berkeley doing research for my Ph.D., I was looking for patterns to address one of the biggest problems with computers: the “private language problem.” The “private language problem” in computers means that you can create anything consistent, because as long as something is consistent, it can work. So, on the one hand, it’s very easy to create a private language, or your own little world in computers, even without trying. But on the other hand, these are very complex machines, and you have to collaborate with other systems and code in order to get the machine to work as a whole. A private language hinders computer advancement. I think an example will explain it. Let’s say I want to build software that will allow me to get alerts on changing stock prices in real-time. I want to focus on that functionality alone. In order for that to happen, I need to be able to present information on a screen, connect to a network, and use computer memory. Then I also need to communicate with a system that will allow me to gather stock prices. I do not want to build all that. I just want to build the real-time functionality. So in order to create any type of advancement in computers, various lines of code and systems have to talk to each other, and it needs to be simple. So as you can see, the private language problem is critical. It means that if every developer creates their own private language, the systems cannot work together and we would not have the computers we rely on today. So, my research focused on the various solutions that have been tried to solve this problem. Some failed, some succeeded, and there are multiple solutions in place today that work concurrently.

Normally when performing this type of research, it is best practice to present your theory in three different places for it to be considered a valid claim rather than a mere coincidence. So, in my research, I found this specific structure that existed in computer languages that enabled private languages to exist and, at the same time, to enable communication. I also found it in computer networking, but I needed to find it in one more place, and that place ended up being in databases. That was the key I needed to prove my theory. After a lot of research, I eventually showed it in three places. The base of the private language solution is not to inhibit it, but rather to embrace it. Create endless private languages that have interfaces to communicate between them — basically, create something that has no constants. Then I got greedy. I asked, “Is it possible to create an application with no constants?” Or in other words: “Is it possible to create a meta-programming application for non-programmers?” Suffice it to say that it’s very complex to do that, but this question and searching is what eventually led to my company, Regpack.

What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?

So, based on the research I just described, I built a prototype and shared it with my professor from MIT, and he thought it was incredible. So we wrote an article about it, but then I thought, “Okay, but does anybody need this?” So I began searching for people who needed a system without constants, for which everything was a variable. Naturally, I turned to my friends who happened to be working in university administration. After talking with a few people, I suddenly understood that onboarding and applying business logic to various situations are always different, which goes back to the problem of the private language. Every unit creates its own private structure and its own methods, so in this case, people needed systems with no constants. This together with some life change factors brought me to decide to commercialize the idea. I completed my postdoc research, and decided to abandon my ambition of just doing research and decided to start a company. We began with registration because registration was a complex private case of a business flow, and that’s how Regpack was started.

In the beginning, it was very difficult for people to understand because there was too much freedom, which was an eye-opening experience for me. Telling people they could do anything they wanted in the system was just too much for them. Sometimes it was really painful to see how people struggled with a system without constraints. So, our team slowly started creating a system that would work well for them, which took out some of the guesswork and the “freedom” and gave them enough boundaries to focus on solving real business problems. Today, knowing that millions of people use my ideas every day, that’s amazing. People have our system open all day, and it is their primary tool to make their lives or businesses work.

Was there somebody in your life who inspired or helped you to start your journey with your business? Can you share a story with us?

I come from a family where we’re either PhDs or business people. You create something in the world, have a business, or become a professor. Nobody works for someone, so that was never an option for me. Turns out, I didn’t want to be a professor, so my other option was to open a business.

What do you think makes your company stand out? Can you share a story?

What makes Regpack unique as a company is that I do everything I can to allow everybody to be as creative as they can, which is really important for me. I treat everyone as an adult, so if you mess up, you fix it. You don’t get fired, and nobody shouts at you — we never play the blame game. We’re here in the world to create something interesting and leave a legacy. To do that, every person in Regpack needs to find what they’re passionate about and what makes them happy and do that. I always tell people that if someone constantly wakes up in the morning dreading what they’re about to do, then they should stop because it doesn’t make sense. And I think that mindset is also connected to our product.

We built the product to allow you to create what you want and the processes you need. It gives you the building blocks to make an exceptional business. It doesn’t tell you what to do or put you in a lane until you reach the next step. Instead, it gives you the tools and abilities to create something exceptional that only you could create. That’s what makes Regpack unique. Business processes and finances, payment processing, data collection, and data manipulation are the heart of most businesses. If you can think outside the box when doing these things, you will succeed as a business.

How have you used your success to bring goodness to the world?

The goodness that we’re bringing into the world, I would say, is through the concept of understanding that you don’t have to do everything the same as everybody else. For example, my youngest son, who’s 11 years old, is a violinist and understands music very well. We were watching Eurovision when he pointed out that every song is the same. The tune was the same, the way they sang, and even their overall look was the same. Then there was a song with lyrics that were, “I am not the same,” which, as you can imagine, was very much the same as all the other songs. My son just cracked up completely. He thought it was the funniest thing ever. So I think that’s the type of goodness I want to bring into the world: that not everybody will be the same. There is a lot of talk about being “different.” That is not what I am talking about since being “different” is still connected to others since you are trying to be different from them. Not being the same is a very different mindset. It is a mindset that you go out into the world and just “do your thing” regardless of whether it is different from others. It is true creation out of your inner soul and not imitation or defiance. It is subtle but “not the same.”

You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?

The first one is never to give up and to understand that your failures are your stepping stones to success. We introduced a great program called purchase protection, where if you’re sick, one of your family members is sick, etc., you’ll get the money back for the section of the course or activity you missed. It was a cheap add-on during checkout that we felt really good about. However, when we brought it out, it was a total failure. We worked six to seven months on it, and nobody wanted to try it, hear about it, or talk to us about what it could do. So we spoke to the underwriters from the insurance company to understand what was happening and worked on it for another year. We chipped away at it, and now it’s a phenomenal success — one of our most extensive programs that works well. Your failures are just challenges, not indications that you need to stop.

The second trait is delegating. A leader must understand that once you give people freedom and power, they will spread their wings and do much more than if you hold them all the time next to you. I tell my employees to figure it out and devise a solution the best way they see fit. I know that many entrepreneurs and CEOs are very centralized, and I think that works to an extent for legal and finance stuff. But just let people fly in anything connected to product development, clients, and client success and support. They want to, but no one ever allows them. So give people a chance to fly.

The third trait for success is to maintain self-care. My worst experience with burnout was during my Ph.D. It took me three months to get back on track, so I know how dangerous it can be. Taking care of yourself, your body, and your mind is imperative. I meditate, swim, cross-fit, and find time to eat lunch with my kids every day. That’s something I don’t ever give up because if you don’t take care of yourself, you’re maybe working at 20%. The worst thing that can happen to a company is a burnt-out CEO. If they’re not thinking straight, they’re not focused, and then it’s just downhill from there.

Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?

Before chasing funding, especially from VCs, most companies should ask themselves, “Do I want to be in the world of VCs?” Many people think that getting funded is an achievement when actually, in a way, it’s a failure because you cannot create a prototype or something with your bare hands or with your friends that can sell.

If you’re building a car or a machine-learning system that understands human emotions, where research takes years and years, then yes, go for funding. Most of the companies that I talk to and that come to me for advice are companies that can start slow, but they want to come out with a bang and say, “I’m a startup that got funding, and I have a PR company, even though I don’t even have anything to sell yet.” Then they go down in flames when they could have built something good if they had only taken their time.

The only essential things in the first few years are returns and understanding your product, audience, and how you can sell to them. That takes time. And when you take funds from these VCs, which expect you to hit the ground running, you’ll be totally burnt out with no product or money to show for it. So, my advice is to think if this is what you want because it’s a very specific path, but it’s not the only one.

Can you tell us a story about the hard times that you faced when you first started your journey?

We started out and initially had a promise from a VC that didn’t come. Nothing was actually signed, but we started acting like someone that got funding, and then it burned and crashed for a bunch of reasons. We then moved to a situation where it was Calvin, Edgar, and myself trying to keep the company alive. After two years of the company’s existence, we needed to find a way to pay the essential bills. After that, we basically had to restart the whole company.

So, we rebuilt the software. We rebuilt our relationships with our clients, and everything changed. We had to generate income right in the first month, and we did it. We processed for our clients something like $6,000 that month. It was a journey, and we learned a lot. Today, we recognize that the funding not coming together was a blessing in disguise.

Where did you get the drive to continue even though things were so hard? What strategies or techniques did you use to help overcome those challenges?

This is very cheesy, but every night after I’ve worked like 18 hours, my wife would give me a kiss. She’d ask me, “Is this what you want?” and I’d tell her yes. And she would tell me: “If this is what you want, I’m with you and I know you will make it happen.”

The journey of an entrepreneur is never easy and is filled with challenges, failures, setbacks, as well as joys, thrills, and celebrations. Can you share a few ideas or stories from your experience about how to successfully ride the emotional highs & lows of being a founder?

I say just don’t do it. Meditate and understand that it’s not real, and you’re the same person you have always been. The failure, success, highest, and lowest aren’t real. Whether tomorrow morning 20 articles about me come out and we land a 100 million-dollar deal or my company crashes and burns, I’m still the same person. That’s what is real.

Do not emotionally connect your identity and self-worth to your successes or failures. You must connect your identity and your self-worth to yourself.

Let’s imagine that a young founder comes to you and asks for your advice about whether venture capital or bootstrapping is best for them? What would you advise them? Can you kindly share a few things a founder should look at to determine if fundraising or bootstrapping is the right choice?

As I mentioned, you must think hard if funding is the right choice for your business. Companies that have a slow start are not necessarily struggling. They are just taking their time to perfect their business plans for a successful future.

Ok super. Here is the main question of our interview. Many startups are not successful, and some are very successful. From your experience or perspective, what are the main factors that distinguish successful startups from unsuccessful ones? What are your “Five Things You Need To Create A Highly Successful Startup”? If you can, please share a story or an example for each.

First, you need to create something in the world. Don’t do this to get rich, be a hot shot, or so people will know you. You need to do it because you want to create it. My son builds and programs these crazy robots with Legos, and my wife asks him why he doesn’t show them to someone. He says it’s because he just wanted to create it. That’s precisely the point. If you’re only creating it for the side effects that come after, you won’t hold up because it’s too hard of a journey. But if you’re passionate about what you’re doing and creating and get up every morning ready to start, you’ve done 90% of your success.

The second would be to bring good people around you. Let them fly, be creative, do what they think, and make sure they argue with you. Don’t look for yes men, people that will always agree with you. When people start agreeing with me, I get worried and want people to tell me what we’re doing wrong. If everybody agrees about this, something’s wrong. So don’t hold people back and let them be themselves.

Next is to find your initial audience and understand their needs. At the beginning of Regpack, we had this thought to build this crazy thing that can create graphs between data units. We had been working on it for so long that it made my brain hurt, but it was finally ready to present to our three best clients. We showed them everything they could do, I was super excited. The clients said: “That’s really nice, but what we really need is… “. This is a true story. I was frustrated for a week for the time and energy wasted. That was when I understood that you must listen to your audience and communicate to know what they really need. Don’t listen to what they are saying, read between the lines. Ask them about their problems, not what solutions they need. Implementing their desired solutions will send you on a wild goose chase that will end badly. If you understand their problem and think how to solve it, but really solve it, you will thrive.

The fourth one is a little cliche, but it’s to hire slowly, and fire fast. You have to find the people that will work out for you and the vision for your company. There are billions of people in the world. If it’s not working out and these people cannot be part of the culture you’re trying to create, then it’s time to move on.

The last thing is not to be the same. We talked about it in a previous question. Before COVID, in 2014, we became a semi-distributed company. I explained that being distributed and having employees work from home made them more productive, happier, and have a better work-life balance. People were concerned that I let my employees work from home and wondered what if they were at the beach all day? Let’s say they are at the beach all day. So what? They can be at the beach if they did what they needed to do and everything is functioning the way it should. This was against the norm for most people because they were stuck thinking in the same mindset as everyone else, believing their employees needed to be monitored. Do your thing, even if it is not common, take a deep breath, and dive in anyway.

What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?

Building something nobody wants. That often happens because they’re building it based on the pitch they gave their funders or building something without researching if there’s a big enough audience. Add to that that a lot of people come up with an idea and have no technology education or knowledge. They then try to be a CEO of a technology company. It’s like trying to teach someone to swim without getting into the water, and they’re three kilometers from you. You’re shouting to them to do this or that, what they are asking for makes no sense. And all along they think they are “thinking outside of the box” and their development team is the problem. A CEO of a tech startup needs to understand technology. This is not true once you reach a certain size, but in the beginning, you are tiny.

If you don’t know how to build a basic application, please don’t be a tech company CEO. It makes total sense that the CEO of a bike company needs to be someone who rides a bike and likes bikes. The same thing applies to a tech company. If the CEO is someone who doesn’t speak or write the language in which all of this is built, it’s ridiculous.

Startup founders often work extremely long hours, and it’s easy to burn the candle at both ends. What would you recommend to founders about how to best take care of their physical and mental wellness when starting a company?

Creating a work-life balance is vital because it’s a marathon, not a sprint. And it takes years. Typically, it takes about 10 years for a company to become something that’s worth something. So, you have to create a work-life balance — be with your kids if you have kids or be with your spouse. Be comfortable enough to do the long run.

I take good care of myself, eat healthily, meditate, swim, etc. I’m also not restricted to the standard work structure; the nine to five doesn’t exist for me. I start my day at 5:00 AM and finish at midnight, but I have that balance that enables me to get these 12 or 14 hours of work without feeling exhausted.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I think what’s lacking in the world today is being creative and not being the same as everyone else. Be yourself and create something in the world that you can look at and say, okay, I’m happy with that. Once more people will create in the world and reach the point that they are satisfied with their creation, I think the whole world will be a much better place. People will be much less angry because it’s not about what you have, where you went, what you believe in, or what you like. It’s about what you created in the world. And it doesn’t have to be an actual thing. It does not have to be code, jewelry, or a painting. It can be creating a concept, a way of life, or your own rhythm of the day. That’s something that is yours. And I wouldn’t know what to call that movement or how to do that, but I think that’s really lacking in the world.

We are blessed that some very prominent names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch, and why? He or she might just see this if we tag them.

I think Jeff Bezos is exceptional in the way he thinks. It would be interesting to have a conversation with him and learn his industry perspective.

How can our readers further follow your work online?

You can learn more about Regpack on LinkedIn and our company blog. We publish many tips and guides to help businesses manage their administrative processes.

This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!

Perfect! Thank you for your time!