As a CEO and founder, Dr. Daniel Wallerstorfer isn’t the typical guest for the show, but his ability to take a tremendous risk and stay positive under intense pressure is something we can all learn. In this episode, you’ll hear the challenges of entering a new market as perceived outcasts and how they became market leaders.
In this conversation, we focus on Novogenia, a genetics company that is until COVID happened. To survive, Daniel thought they would have to lay low and drastically reduce costs. But that’s not what happened.
Daniel has a tremendous ability to take significant risks while staying positive under pressure. Despite being seen as outcasts in the lab field, Daniel and his team saw an opportunity to make a difference, thanks to their high automation level. With this positive outlook, Daniel and his team overcame the challenges and gained a 60% market share in less than six months.
What is Daniel’s advice to others experiencing a significant change under pressure?
In this episode, you’ll learn:
What to listen for:
Daniel Wallerstorfer: We've been profitable since 2013. So everything was going really well, and then COVID came.
Trinity Nguyen: This is the First 100 Days, a show for revenue practitioners by revenue practitioners, giving you unscripted access and exclusive resources to help you navigate any new transition and initiative. I'm your host, Trinity, from user gems. Before we embark on any new transition or new initiative, the first thing we need to do is.
Making that decision, knowing all the associated risks and trade-offs, but a lot of time, that decision of just do it, or I can do this is already 50% of the journey to success. And that's why I'm really excited about today's guest.
Daniel Wallerstorfer: My name is Daniel. I'm a molecular biologist. I'm Austrian. So right now I'm in Europe, and I've spent 10 years of my life in the UK. And there, I first did my bachelor's degree in molecular biology and then my Ph.D. in biotechnology. The reason why I got into genetics was to do with dinosaurs because when I was four, I decided that I wanted to become a paleontologist to dig up some dinosaur bones.
And then, when I was 11, I had a life-changing event, and that was the movie, Jurassic Park. And that showed me that it's a lot more. A lot more interesting to clone dinosaurs than to dig up bones. And that got me into genetics, quite the struggle for luck because I was actually in the UK at that time. And we were like children with some teachers there to learn English.
So the parents went there, and then we decided to go to the cinema, and the plan was to watch home alone too. And for some reason, I lost a group, and then suddenly everybody was gone, and all the lobby was empty. So I just decided, instead of waiting in the lobby, I'll just sit in any room, [00:02:00] any theater. So I just opened one door, and I sat right in the front and didn't know what was going to come on.
And then. Jurassic Park came on, then I don't think I closed my mouth for two hours, and I was just so fascinated. I think of watched the movie 10 times afterward. That certainly changed my whole life.
Trinity Nguyen: As a CEO and founder Daniel, isn't the typical guest for the show, but his ability to take a tremendous amount of risks and stay positive under pressure is something applicable to all of us at work and in life.
I hope you enjoy this episode as much.
So just to set the context for the audience, can you tell us about Novogenia?
Daniel Wallerstorfer: So we, we started off 11 years ago with the main goal of personalized healthcare or personalized medicine and would say, so the idea was every one of us has a lot of genetic strengths and weaknesses, and those really do influence [00:03:00] our health.
And the idea was let's do a genetic test. Before a disease occurs rather than afterward, which is the current trend and then try to prevent this disease in that person. So that's what we started off with. And then eventually nutrition became a very clear next focus because, uh, pretty much all of the disease prevention recommendations were to do with nutrition.
So we've started focusing on genetically personalized nutrition, and that actually worked quite well. Especially weight management was very popular. So that was where we came from. Then it became clear that actually, a genetic test is not a very good business model because it's a great investment because you do a genetic test once, and you'd never need to do it again.
You've got your guidelines for the rest of your life, so good for the customer and not very good for repeat business. So we looked into what other things could we add to this? And that's how we came up with personalized supplements as well as [00:04:00] now we have personalized cosmetics. So we do have a medical, genetic testing laboratory, all of the medical certificates and medical quality, but we do nutritional, genetic testing.
And, uh, based on that, we create personalized products. So this is where we were before COVID came.
Trinity Nguyen: As you will, soon here, Novogenia needed to adapt that entire business due to the pandemic from being a personal genetics testing to COVID testing. What's interesting is a series of decisions that Daniel and his company made very quickly.
And that helped them going from being a startup to becoming the leader with 60% of market share in less than six months. So let's dive in.
Daniel Wallerstorfer: We've been profitable since 2013, so everything was going. Really well, and then COVID came, and initially, we didn't know what was going to happen. [00:05:00] So we thought, should we just lay low?
But eventually, we thought, hold on. Actually, what we have in our lab highly automated, and it's actually the perfect COVID lab. And so we decided to take the step and see what, what will become of it. So it's interesting that
Trinity Nguyen : You mentioned at the beginning of this first 100 days, you didn't want to get into the COVID testing business.
Can you share a little bit more about why that was the case?
Daniel Wallerstorfer: as a, a personalized genetics company? We are quite the outcasts in the lab fields. So there are these established blood laboratories that are. Used to do viral testing and all of these things and medical things. So they have doctors in a zone.
We didn't have doctors. We didn't need any doctors at that time. And so the first thought was, well, I don't know how this market works. I don't know what is going to happen. I don't know what kind of resistance we're going to [00:06:00] have from the markets. So initially, I thought, well, this is just. Too new for us, uh, on so many levels that we shouldn't do it.
That was the initial thought. But then again, uh, I heard what. Horribly small capacities, very big established labs had. And then we just did the calculations just to give you an idea that the labs here, they, they range from around 200 tests per day to around 2000 tests per day, just quickly did some calculations and saw from what we have here.
We can do 18,000 per day. So way more than, than all of the other labs. So we just changed the target, and that's it. I'm
Trinity Nguyen: assuming that you probably went through a lot of different trade-offs consideration, like your trade-offs for doing it, that also the trade-offs of not doing it. Right. And clearly, you guys decided to do it, but then I'm sure there's still some opportunity cost.
Like for example, right now, almost a hundred percent of your resources are in COVID testing instead of genetics. Can you [00:07:00] share a little bit more on the trade-offs consideration that went on in your mind at that time?
Daniel Wallerstorfer: We gave up the strategy of keeping low keeping costs low and trying to survive that way.
That certainly was a risk because we didn't know what was going to happen in a financial crisis. Nobody's buying the luxury of a genetic test anymore or supplements anymore. So that certainly was a big unknown, and that was the risk. I think with all of the programs, especially what we have in Austria, we had a very good cost reduction strategy that could have worked.
So that was one of the trade-offs, uh, obviously sleeping on weekends. That's the trade-off I spoke as on
Trinity Nguyen: the 100 days app to that decision during that process, what surprised you?
Daniel Wallerstorfer: How hard it is to get employees definitely be that one that used to be the situation where they are way more biologists than jobs.
And it's really easy to get biologists, but that very quickly changed. [00:08:00] We are fully automated, but really getting. From the bag of chips that, that somebody sends you to the first robot, that's such a huge, huge manual labor part, and that's quite hard to scale, and all sorts of human errors happen. The machines can do 18,000 per day, but first, you need to get the 18,000 into the machine.
That's really a lot harder than people would think. Speaking
Trinity Nguyen: of hiring, but you guys managed to scale your employee size really significantly. I remember last year, was it around 30 something? And now it's about 120, right?
Daniel Wallerstorfer: 170 now 170. Yeah. So over the last four to five months, we hired a hundred extra people.
Yeah. That's a challenge in itself. And now we have one person just hiring people. Uh, that's also something you. We used to have a very, very elaborate, uh, interview process that has completely changed. Um, I, I don't even meet them anymore, and they're already in the lab. Uh, so that certainly has, has changed a lot actually. Once we did decide that we wanted to start, we said, okay, let's go full speed.
And actually, I remember a funny time, usually, when you want to establish a new test, like a COVID test, I would say it takes around three months until it's done. And we managed to do it in around 10 days. So it was incredible work by, by all of our people. And, uh, we already started going on on media. And I remember this one time, our first big television presence was shown all over Germany.
Uh, we set up the computer when it was going to be live. And right next to the computer was the machine that was going to tell us if we can even do it. And it happened at the same time. And we also had to count how many people are on the, uh, on the website, and thankfully didn't work. So that was certainly high diving into a pool and making sure the, is there when you land that kind of situation.
Trinity Nguyen: If you could go back in time, what would you do differently in those first 100 days?
Definitely software. I would have done differently because I made a big mistake. We had an established software development team. They're very good. They do their stuff very well, but it takes two to three weeks until it's done, which is really fast for software development purposes. But I thought I want to save those three weeks.
Let me do a quick alternative. Uh, now, months later, that alternative still doesn't work. Um, so I definitely lost a lot of time trying out a new software development system rather than sticking with the old system.
Trinity Nguyen: So tell us about the outcome.
Daniel Wallerstorfer: So initially, we had quite small sample numbers. Uh, we had private people sending in samples that were our initial target market because that's the market we understood.
I then started to contact the authorities in the different counties in Austria, and that I had immediate great [00:11:00] interest because the whole lab space was completely in chaos. So we have one County in Austria. They had. Uh, around 40 labs, each one of them could have done around 300 to 500 tests per day, but the majestic was a nightmare because where did this sample go?
The sample is lost, and so on. And so what really. Made it quite easy for us to establish a lot of markets was our capacity. The press loved it. That helped me a lot. So it starts to scale up. And then we got counties that started sending to us. And today, we do around 15,000 per day. So way more than that, the next biggest lab here.
Trinity Nguyen: Why do you think it is the case that your lab has 10 times the capacity of the second lab? Was it because of what you guys did before for Novogenia or was it just pure luck that you had that capacity?
Daniel Wallerstorfer: That has to do with liking technology. So everything had to be [00:12:00] automated. Most small labs do things by hand.
The second is with us being geneticists, geneticists, like to work with open systems, the Lennox of the lab machines that allows us to switch to different reagents. That's certainly very important because, um, most of the labs had very big problems getting reagents—for example, the company rush. I don't know if I'm allowed to mention the company is rush is a very good supply of, of regions and machines.
And it's one of the best machines you can have for COVID testing. It costs almost a million dollars. You put it there, you put the sample in, you put the rush cartridge in, and you get the results at the end. So. Most blood labs are not specialists in genetics. They like this machine because it's kind of like your office printer.
It just does what it does. And it does it really well, but it's a closed system. That means if you don't have to rush cartridge, you come to a test, and that's the problem. Most labs ran [00:13:00] into, they all had this expensive, great machine, and then Roche couldn't deliver anymore. And then the cost delays and everything, and no lab in the first wave was able to reach the full capacity just due to shortages, which we never had.
Trinity Nguyen: It's almost like a David versus Goliath, right? Like everyone else's Goliath, they are using the branded expensive tools, just because it's a defector versus as a startup, you need to be more scrappy. And the fact that you being scrappy and being creative, think outside the box, that gives you the advantage in this situation and help you guys grow while the other ones are somewhat suffering.
Daniel Wallerstorfer: Absolutely. So we've gone into a lot of areas where we've had to be creative. So as we wrap
Trinity Nguyen: up until today's conversation, you, one of the very few people I know. That rarely, if ever, gets stressed out. And we met a few years ago, and I remember one of a conversation at your place where I asked you, are you stressed?
And you're like, no, I don't. Why are you asking? I don't feel any stress. [00:14:00] So one of the details we didn't cover earlier in our conversation is that you also became a first time that this year amidst all these changes in the business and the chaos in the world. So if you could share one tip that you use yourself to manage stress, what would it be?
Daniel Wallerstorfer: Well, uh, to elaborate on what you said before, COVID, I would have said I'm never stressed. I think I had in my whole history of the company, uh, one night where I couldn't sleep due to something that happened at work, but, um, Endlessly optimistic. Actually, there's a funny story about my co-founder and me. One of our friends said during the first three years where we were always short on cash and not profitable, he said, uh, it's so funny.
Whenever you talk to my co-founder, who was mentioned managing finances, we are this close to going bankrupt. And then whenever you talk to Daniel with this close to taking off, so that really wasn't, uh, wasn't a hard time for me, endlessly optimistic. Thankfully I was [00:15:00] right in the end. So I have a, I think optimism certainly helps, but then COVID came, uh, the situation became a lot more serious than at the same time, as he said, I became a dad, not under normal circumstances either.
So my wife had preeclampsia. So at the same time, she was in the hospital, and she swelled up, and it was a really difficult situation. Preeclampsia is potentially fatal. But everything worked out, but then our child was on the intensive care unit. Um, so that came on top. So I would, I would say I had about 10, 10 nights where I was a little stressed, but the rest was, was quite okay. I would just say, be optimistic. I find myself always being stressed in situations where I don't have a plan of what to do about it. And as soon as I have a plan. Everything's sorted. So I think that's certainly one part. I always like to keep my [00:16:00] mind occupied before also before COVID. So whenever I have any time, I listen to audiobooks, and certainly, if you go to sleep and you listen to an audiobook until you fall asleep, that helps you also not let your mind wander.So that certainly is a good way of keeping your thoughts in something, something milder. Beside that
Trinity Nguyen: tips, optimism. That sounds like a genetic thing that you were born.
Daniel Wallerstorfer: with it. I think so. Yeah. Well, people like me, I'm sure you can modify it in some way. Um, but you're certainly born with a certain predisposition to think a certain way.
Trinity Nguyen: So the last question is our audience is, as I mentioned earlier, sales and marketing customer success professionals who often need to make major changes in their strategy or sometimes pivot their career entirely. So if you were to create a cheat sheet for someone about to make a major transition, or start a major initiative, what would be on it?
Daniel Wallerstorfer: I mean, I'm a, [00:17:00] I'm a biologist yet. I'm the main marketing person. We do have great marketing people, but, uh, I'm the one that needs to communicate it as, as being the CEO. So I'm certainly not qualified by education, but, uh, scientists have this big tendency to voice what they say in a scientific way. They will never say this is proven.
They will say the evidence points towards something. That's just how scientists speak. That's certainly not. Not useful in marketing at all. So my recommendation is to go very fast. Don't wait for it to be in at that state. When you talk about it, as long as you sure that you're going to get there at some point,
Trinity Nguyen: that was Daniel Velo, Stauffer Christian. So this was a different type of 100 days than our typical guests on the show. What do you think?
Daniel Wallerstorfer: What I like about it is just the timeliness of the topic. It gives us [00:18:00] a view into what the companies that suddenly have to manage Colbert for us have to go through.
And it's certainly difficult to react to this huge change that they're seeing of 70. I need to deliver tens of thousands of tests that actually have a real impact because it influences human lives.
Trinity Nguyen: What I like about this episode is for our audience, who are revenue practitioners. A lot of time, we are looking for hacks and cheat sheets to accelerate our careers.
But what turns out is 90% of how to succeed is in your mindset. So what I like about this episode is that Daniel's story is that a lot of time is in his mindset, like how to stay positive. Under the pressure and the ability to take risks. And I think that's something that we all as professionals can learn from.
Daniel Wallerstorfer: I think he makes it sound so easy for us that sometimes we think about like, [00:19:00] what can I like, what's in it for me in this episode, but I think what's. In it is that in every situation, I can like to work on my mindset and see the more positive things of the situation. How can I stay positive in a certain situation?
Trinity Nguyen: Are you going through a major transition within your organization or your career? Do you have a first 100-day journey to share recently on the past? If yes, I want to hear from you, email email@example.com. And if you're looking for the ultimate revenue leader, cheat sheets, sign up to receive firstname.lastname@example.org forward slash podcast.