Rytis Laurinavičius, CEO of Omnisend, Gives Advice on Building a World-Class Startup: “Today’s an Excellent Time to Launch a Business”
Although success evaded the two startups that Rytis Laurinavičius had tried to build into world-class businesses, he never gave up the dream of “having a business empire on which the sun never sets” and is now head of leading e-commerce marketing automation platform Omnisend.
Omnisend, a Lithuanian startup, has grown independent from external investment – a rare occasion in the sector globally. Products developed by its almost 200-strong team are used by 100,000+ e-commerce businesses from as many as 130 countries. Most of the clients come from the U.S., while the company’s main offices are located in Vilnius and Kaunas.
“Wanting to own a new car and apartment by the age of 25 is profoundly constraining – people begin to avoid risk-taking for fear of missing the next month’s payment. I myself drove an old car until my kids were born and my wife told me it was unsafe, when we nearly lost a wheel for the second time. I only bought my own place at 38, when I was able to do so without borrowing.
For whatever reason, I can’t stand being in debt. When you don’t have any obligations, the worst that could happen is you sleep on your parents’ couch until you find a new job. There were times where I’d pay everyone their salaries and have nothing left for myself, while my former classmates were building careers in corporates, buying the latest smartphones, and driving company cars. I had my doubts, of course, but freedom remains my top priority,” Rytis Laurinavičius said, commenting on what’s most important for building a startup.
– You say that freedom is your top priority. What does it mean to you?
I value my physical, emotional, and creative freedom above all. Money is only valuable if it grants you freedom, e.g., from worrying about what kind of milk or evening entertainment you can afford. I wanted to be able to have breakfast in Vilnius, lunch in Paris, and then party in Barcelona. The cities don’t matter – freedom of choice does. And, speaking frankly, I find life imprisonment a far worse punishment than the death penalty.
– Does freedom also guide you at work? You once said that if an employee’s goals don’t match the company’s own, the employee should immediately “turn in his/her notice”. At the same time, you have a unique internal “grown-up’” culture, unburdened by obligations like working exclusively from the office.
These claims aren’t mutually exclusive. Either those goals align or they don’t – today we have a lot more freedom to choose an occupation we truly like. And if you do your job well, you’ll inevitably be rewarded – financially and otherwise.
– Startups today are, actually, hiring top talents and paying high salaries. For instance, the average salary at Omnisend is €5,500, which is quite attractive. What personal qualities are you looking for in potential hires?
The most important quality is internal motivation. You have to love the job you’re applying for, because there won’t be 5 nannies there, urging you to do this or that, like in kindergarten. Other factors include a drive for self-improvement and orientation towards results. We compare ourselves to a sports team, not a family.
– Tell us more about the current state of Omnisend.
Well, there’s a feeling globally that a crisis is right around the corner. On the other hand, it’s still not here, after all this time. I’m starting to suspect that maybe the world will be able to avert it after all. Each quarter, we check which of our 4 scenarios best matches our actual condition. For now, things are looking up. Truth be told, 2022 was harder for us than 2023. Our main clients are e-commerce businesses, and last year we saw a bit of a post-COVID hangover, where a huge leap was followed by normalisation. We’re currently in a fairly regular cycle.
– Is this cycle related to your aim of becoming a unicorn, which you acknowledged a few years ago? What steps have you already taken and what remains to be done?
I’d say that the unicorn title involves two key components:
1. Revenue and growth, both of which are robust in our company. Considering today’s turnover and potential future value, we’d probably be very close to this goal or even beyond it;
2. Market sentiment and emotions – they’re currently negative. Nobody predicted COVID, the war, or the economic crisis, but life proceeds in cycles that we can’t control. The unicorn title is granted when others start investing in your business, and yet we continue forging ahead consciously without looking for investment. For now, we’re not pursuing unicorndom as a goal in itself.
– Then what is your aim today?
For me, moments of uncertainty always confirm the value of holding control in your own hands, rather than handing it over to investors. We plan our activities on a quarterly basis, calculating a given month’s performance and then forecasting 3 months into the future. This makes us more flexible regardless of market conditions – there were no layoffs at Omnisend even during the most difficult period.
We are today No. 2 in our segment globally. To further consolidate our position, we’re waiting on No. 1 to make a mistake, so we could take over. We’ve heard that, having so far raised $800 million in funds, this company is now getting ready for an IPO. We’re trying not to fall behind too far or get demotivated, but rather to stay close enough, so that we’d be able to reach the top when the moment is right.
– Orientation towards profitability, short growth spurts – what other decisions have led to your current success? Few know this today, but you’d started out as a digital agency.
Yes, Omnisend grew out of a digital marketing agency. There were several important criteria, but, for a start, we chose a growing niche within a hugely overcrowded market. We first went into email marketing, which was dominated by several undisputed leaders, and picked a segment that we thought had potential to grow – we were right. Secondly, the Lithuanian market is very small. If you have global ambitions, this is not the right place for that Our lesson was that it takes a similar amount of effort to get a foot in the door of any market, regardless of size. For instance, although 1% of the U.S. market often exceeds 30% of the Lithuanian, reaching that 1% is still easier – even if you’re unfamiliar with it, have no experience there, etc. There’s just more of an opportunity to hit the mark through improvisation.
– What would you do differently today? What were the biggest mistakes in growing the business?
I find that people think too much about the past, which no one can change, and worry excessively about the future, which is often different from what anyone had expected. It’s important to dream and to speculate about the future, but we shouldn’t define ourselves too narrowly, as that only leads to unhappiness down the line. One’s future vision should be broad enough to allow for positivity. To get back to the question, I can’t single out any fundamental errors – only habits that I’m still fighting today. For instance, putting off uncomfortable decisions that have to be made today, but that get postponed for half a year before they’re finally made. These are mistakes that slow down progress towards a goal and make it more costly. When you feel that some burden becomes too difficult to carry but you’re hesitant to drop, I’d say you should drop it.
– What qualities should a startup founder have?
I really like this one study carried out by the American writer and business consultant Jim Collins on what distinguishes long-term successful companies from those that briefly succeed and then collapse – it’s dogged perseverance in the face of difficulty.
– How do you maintain this quality? How do you relax from work – or recharge for it?
I like playing squash, reading, including fiction, hanging out with friends – even pulling an all- nighter at some bar once a month. I seek balance in everything.
– We’ve been talking about strategy, business success, becoming a unicorn – have you always wanted to be an entrepreneur? What was your childhood dream?
I wanted to drive a bus – or at least a harvester or an ambulance. I was fascinated by all those lights and buttons. As a teenager, I considered going into politics, and even got a political science degree. I wanted to become the youngest parliamentarian ever, and took part in civil society initiatives. Then, in my sophomore year, a friend called me up and offered to start a company together. I can’t honestly say I was totally ignorant about business, as my mother is an optician. She’s now running her shop with my sister, but back then, when she was just starting out, I gave her a hand from time to time – that was my basic introduction to business.
– Your parents are physicians, right?
Both my parents are physicians, and my sister is now pursuing the same path. For whatever reason, I was never attracted to it myself. Given physicians’ massive work loads and long periods of being on call, I spent a lot of time colouring in various doctors’ offices. Although drawing well evaded me, I built up my capacity for patience, which is useful in business. Sometimes it’s all about waiting and leveraging circumstances, not to say that prep work is unimportant.
– Tell us more about your career before Omnisend.
When I was 20, we started making polyphonic ringtones and screensavers. After selling the business, we probably recouped the investment, but didn’t achieve much success. We did, however, gain lots of experience, and I realised that I liked building the company. My first heftier payday came from real estate before the current economic crisis, until a certain businessman gave me pause by saying: “If every taxi driver and painter in Vilnius is now doing it – it’s time to stop”. Then came my first startup-adjacent effort – printing organic postcards. We envisioned the business to be digital, but most of the packaging took place in some 29 shops in California. To continue doing it, we would’ve had to move to the U.S., which just wasn’t legally possible. We closed down the business, but preserved a part of our team, and then jointly founded a digital marketing company – the predecessor to Omnised, where I contributed to developing a conferencing tool. To this day, I never worked anywhere as a regular employee.
– What are your current personal goals?
I used to fantasise about building an international business, and now, all of my adolescent dreams have been realised. That realisation hit me pretty hard. I felt empty. Totally empty. Working to improve on past achievements wasn’t enough. Luckily, I’ve found a new goal – changing the Lithuanian education system. I even made a couple of tentative steps in that direction, for instance, in tandem with other startups I organised the very first national IT exam. But this is just the beginning.
– Speaking of investment – what else are you dedicating your time and money to? What products/sectors are the most promising?
I believe e-commerce will continue to grow, because not all of its outstanding issues are yet solved. Most of my investment goes to a fund that, in turn, invests in commercial startups. Though not particularly active, when I do invest, I choose people and teams I believe in.
– Would you recommend people to start businesses/startups today? What should they pay attention to? Lately, everyone’s been talking about market changes and the potential of AI.
Every crisis brings new possibilities. Many new businesses arise precisely in times of hardship. Objectively – some people are losing their jobs and finding no alternatives, while subjectively – attracting talent is cheaper now than at any point in the past 10 years. Today, it’s possible to be effective with less funds, which makes it a great moment to start a business. And if you succeed during the crisis, there’s no question you’ll be able to grow when things go back to normal. In any case, it’s crucial to gain extensive knowledge about the sector – or product, or process – you plan to base your business around, and to avoid pursuing every promising-looking blip on the market. The power of AI will probably also be realised the most by people capable of applying it to specific areas. Although, frankly, I’m not too confident in how things will turn out in the end. On some days, it seems like AI is analogous to the steam engine, while on others – that it’s both the beginning and the end, as governments around the world are beginning to regulate it at such an early stage.
– What’s needed for the number of Lithuanian startups and unicorns to increase?
Success stories and attention to them. There’s no better inspiration than real-world examples and stories – they help people to understand that, if someone else made it, perhaps they can, too.
This interview was prepared by Vilnius TechFusion partner Unicorns.lt. Find the full story in Lithuanian here: „Omnisend“ vadovo Ryčio Laurinavičiaus patarimai, kaip sukurti pasaulinio lygio startuolį: tai – labai geras metas pradėti verslą | Unicorns