SaaS Scaling Secrets
The SaaS Scaling Secrets podcast reveals the strategies and insights behind scaling B2B SaaS companies to new heights. Dan Balcauski, founder of Product Tranquility, leads conversations with successful SaaS CEOs, exploring their challenges, triumphs, and the secrets that propelled their businesses to the next level.
SaaS Scaling Secrets
Healthy Teams = High Performance with Derk Arts, CEO of Castor
In this episode of SaaS Scaling Secrets, host Dan Balcauski interviews Dr. Derk Arts, founder and CEO of Castor. Dr. Arts shares his unique journey from medicine to tech entrepreneurship, highlighting how Castor is revolutionizing clinical trials with a focus on global health equity. The conversation covers Derk's early entrepreneurial ventures, the challenges and strategies in scaling a B2B SaaS company, and the importance of maintaining a culture prioritizing employee well-being.
00:28 Meet Dr. Derk Arts: From Medicine to Tech
02:57 Early Entrepreneurial Ventures
05:16 Overview of Castor and Its Impact
08:47 Inspiration Behind Castor
12:25 Balancing Profit and Global Health Equity
17:38 Scaling a B2B SaaS Company
24:14 Screening for Grit in Interviews
25:05 The Importance of Reference Calls
28:42 Prioritizing Employee Health
35:32 Maintaining Mental Health as a Leader
40:14 Learning from Mentors and Peers
43:32 Final Thoughts and Advice for CEOs
Guest Links
https://www.linkedin.com/in/derkarts/
Hello, and welcome to SaaS Scaling Secrets, the podcast that dives into the trenches with the leaders of the best scale up B2B SaaS companies. I'm your host, Dan Balcauski, founder of Product Tranquility. Today, I have the privilege of interviewing Dr. Derk Arts, an MD, PhD turned tech CEO, who's revolutionizing the world of clinical trials. Derk is the founder and CEO of Castor, a decentralized clinical trial platform. Under his leadership, Castor has supported the World Health Organization's global solidarity trials during the COVID 19 pandemic and provided pro bono support to over 3, 000 clinical trials worldwide. Join me as we explore Derk's unique journey from medicine to tech entrepreneurship, uncover the secrets to his success, and reveal his strategies for scaling Castor while maintaining a strong focus on employee well being and global impact. Let's dive in. Welcome Derk to SaaS Scaling Secrets.
Derk Arts:Yeah, thank you so much for having me. Really excited to be on the podcast.
Dan Balcauski:I'm very excited for our conversation today as well, Derk. I don't believe we've had an MD PhD on the program before. Could you share a bit about your background? What sparked your initial interest in medicine and science?
Derk Arts:Yeah, of course. I I come from a family that is pretty like medically oriented. So I think that was definitely an important factor that contributed to me making these choices. I will say in high school, I was mostly just very techie and entrepreneurial. So I started a few small businesses already during high school and started getting into technology. But at the same time, I realized that I could teach myself that stuff anyway and, I had a bit of exposure to the hospitals by, joining joining some friends and acquaintances for a few days, seeing what it was like. And it really piqued my interest, so I decided, there was kind of a fork in the road there, do I go the technical route, do I go the medicine route? So I chose medicine because I thought that would be much harder to teach myself, And of course also you need a license to practice, whereas with, technology you can get pretty far by just being good at it. And so, that's how I started on that journey. And then during medicine you get exposed to science a lot. And turns out I really love that. And it's kind of specifically epidemiology. It's a bit more technical. It's a bit more of a numbers numbers thing. So I was really drawn to that and so quite quickly I found just a deep interest to, to see if I could combine medicine, technology, and science into one happy bundle. And so that's kind of what the rest of my trajectory looked like. I, when I finished my MD I had already started cashflow. We'll talk about that more later. I had the opportunity to do a PhD. Of course, during a PhD you learn a lot more about the science than about the epidemiology and it also gives you. A bit more free time to work on side projects, being my company Castor. So for me it was the ideal mix of all those things that I that I liked. And yeah, that's really how I how I started on that path.
Dan Balcauski:You said a bunch of interesting things there, but one thing that really stood out to me, you said in high school, you started a couple of businesses on your own, even while you were in high school. How did that come to be? Were you surrounded by other entrepreneurially minded folks or what was the inspiration for those early ventures?
Derk Arts:I think it wasn't for me about being entrepreneurial. Obviously I didn't even know the word back then. It was just about like creating something or, creating something out of nothing. I think that concept really struck me. My dad was a neurologist and he was also, he also had a publishing company on the side where he published books. I think that was also part of it to kind of see how he would go to trade shows and he would sell these old neurological books that he republished. So I think it was a combination of of wanting to create something out of nothing and seeing seeing my dad run his publishing company that kind of piqued my my interest. So I started getting into computer repairs and started getting into a little bit One of the most fun jobs I did was I worked with a cartographer and they were using Illustrator to create these beautiful maps. And they're all based on the same, like, GIS files, or I'm sure, like, I think it's called GIS. Like, they're all same foundational funds that are being maintained by these governmental type agencies. But then they need to be colored in. And so I work with them to script, to basically automate that process, right? So, I had a little side business where I would get paid to basically automate that process of coloring in these cards. And, all those little things combined just got me a lot of exposure to other entrepreneurs and to just how much I liked. Just creating something, that, that whole computer repair business wasn't a huge thing, but it was just fun to post the flyers and get invited into people's home and help them with their computer and then get paid. And yeah, I think it, it taught me a lot about that you can achieve a lot with just having the right attitude and going after it.
Dan Balcauski:Very cool. Well, a little inspiration from dad and then a little curiosity goes a long way. I remember reading, I think it was Warren Buffett's biography, and he, one of his first businesses, he started him and his friend were fixing up old pinball machines and then renting them back to like barbershops and stuff. And you're just like, okay. And he would think he was doing that when he was like 10 years old. So yeah, everyone's got some interesting stories who ends up on such a path as yourself. So always like to hear about those early. Stories. I want to switch to Castor for those of the audience who aren't super familiar with Castor. Can you give us just a brief overview of what it does, the problem you're solving in the healthcare industry?
Derk Arts:Yeah, of course. So I think important starting point is if you have a medical problem and you go to a physician or a physician assistant or anyone in the medical field I think we all come, go there with the expectation that they're going to give you the best treatment, that you need. So they're going to diagnose you based on something and they're going to give you the best treatment based on something. And that something is evidence, it's research. So, what that basically means is that Any treatment that is on the market has gone through extensive research to make sure it's safe and effective. And also deciding what treatment is best for each individual patient that is also based on a lot of research. So what is research? Research, medical research, clinical research. These are basically very large scale experiments with actual human beings seeing what works best, right? And or the initial stage of developing a new drug is really about first safety. Is it safe for humans? And then is it effective? And is it more effective than any other treatment that's on the market? And then downstream from that, taking all the treatments that are available and deciding which is the best one for each. So, those are all experiments that happen in various phases of research. And all those experiments require data and technology. Because we the way evidence based medicine works is based on statistical inference. So, we take a sample. And from that sample, we extrapolate to the world's population. So we basically say if this worked for a thousand diabetes patients, it will presumably work for all diabetes patients, which is a pretty big assumption, but that's kind of the foundation of all evidence based medicine evidence based methods we have in the world. And so Castor is a software as a service platform that facilitates this entire research process. So at its heart, it's a Platform where data is collected by researchers, by patients, by nurses in the platform where all our data sources can be can be tapped or locked into the study data set. And we also facilitate the entire process of finding and enrolling patients. And so really what we have is pharmaceutical companies, biotech, medical device, academic hospitals, using our technology to run research. a clinical trial or to run a research project. So we have landing pages where potential participants can read about a clinical study. Why would they participate? Why, what does it take to be eligible? We have tools to then enroll them, to consent them. You always need explicit consent. To run a study and then to enrollment onto the study where we collect data from them or from the hospitals that are participating. And so ultimately we produce a very large, compliant data file that you can submit to the FDA, or that you can use in your scientific publications. So if you, Like what is the result? What does success look like? Success is a successful submission to the FDA or other regulatory bodies that govern the approval of drugs and medical devices, or it's a successful scientific paper that adds to the body of evidence that ultimately makes its way into a clinical practice guideline, and that's really coming back to where we started. These clinical practice guidelines, they help these healthcare providers to decide what is the right treatment for this patient. And so all of that is based in evidence, which is all based on data. And we help our customers to collect that data in the most efficient way.
Dan Balcauski:Thank you for that overview. And it is quite a complex process. And I think you did a fantastic job of summarizing it a rather complex set of different players and evidence that has to be moved through your system. What inspired you to start Castor? What problem did you notice that, wasn't out there solved throughout this process? I imagine, this process that you described has existed for a while. Was this just a total lack of technology or what was the inspiration that you had in order to make this better in the world?
Derk Arts:So it started out with me being involved in a research project myself in the ICU. So I was finishing med school. I wanted to be an anesthesiologist. So working with the sickest patients basically in the ICU. And we worked. They were running a study and they were using Excel to capture the data, which without any real prior knowledge was obviously not the right way. And so I said, look, I've, I have a lot of tech experience. I've built a lot of these things already. Let me build a solution for that. So it was really an immediate need that got me into it in the first place. And then I realized that there were some very expensive tools available on the market that were only accessible to pharmaceutical companies, but the vast majority of the clinical studies they were running. In academia, we're just using paper, Excel, XS, random homegrown stuff. So the quality of these studies was way lower. And in part due to that, what we believe to be evidence based medicine isn't truly evidence based. A lot of the evidence based medicine that we believe in and subscribe to as Western society isn't truly based on robust scientific evidence. And that's in part because data from these studies is fragmented everywhere. You can imagine if you run a study on paper, you collect all the data on paper, and you manually type it into a database, the likelihood of that thing being reused is extremely small. So you have all these little pockets of super inefficient, low quality research that doesn't actually roll up to anything Major or insightful. And so, I really started Gaster because, I first, I wanted to help fix the evidence based medicine process. By creating evidence based medicine. A platform that any researcher anywhere in the world could use to run high quality research and that the data from those studies would potentially be reusable. My dream is to be able to pull all research data globally to get to much higher quality of evidence based medicine. And specifically what I want to achieve is to increase global health equity. And so we know the, what I always struggle with is how much money is going to Western societies and Western diseases and problems. With ultimately very little funding and attention going to the vast majority of the disease burden globally. And so, my dream is to, through building a technology company, and maybe another couple of companies further down the road, to really move the needle on increasing health equity by Extending the human health span, so not lifespan, but health spanning, which is the years lived in a healthy state for all citizens of the world. And part of that comes down to having a technology that can conduct these trials very efficiently at low cost, being able to give it to anyone that needs it in the world, and being able to maximize the impact So that's really why I got into it and why I'm still to this day very motivated to run this company, because as you can see, the downstream impact we're making.
Dan Balcauski:So there's a couple of things I heard there. So there, obviously there were tools there, but they were only for the very high end of the market. And therefore a whole bunch of these studies didn't have sort of the quality bar that we might expect. I also heard that there was some amount of maybe data silos where maybe data gets created for a particular study and then is never to be seen again. And maybe potentially some data reusability over time, some correct me if I'm misunderstanding that but which is a really interesting point. And then I think the third thing you mentioned, I was going to ask about this later, but you brought up this, increasing global health equity. And I mentioned a little bit in my intro for you of Castor has provided a pro bono support for over 3, 000 clinical trials, and I'm assuming this is within that same vein to increase global health equity. That's very laudable. I think maybe a lot of leaders might struggle with, like, how do you think about, investing in activities like that balancing that with the pressures of running a for profit company? How do you think about those type of decisions?
Derk Arts:Yeah, I mean, despite our beginnings in Dutch academia, our entire revenue engine runs now on commercial trials. run by for profit companies, mostly pharma and biotechs. And that's because, of course, we've shifted our attention away from from the academic market from a go to market standpoint, because the market just isn't there, right? If you just look at the total addressable market for academic research, there's a couple of Western countries that have a lot of funding for clinical trials. But other than that it's pretty sparse. And we said, look, If we want to grow, if we want to build a billion dollar company, or whatever your frame of reference for a successful company is, we need to start getting into commercial trials. And so we very successfully evolved into supporting those trials. But that doesn't mean you have to close the door, right? So I think the beauty of a software as a service solution is In theory, anyone can use it, right? So it's like start a subscription, start using it. And so Castor is one of the very few players in our industry that is fully self serve, but even like self sign up. So anyone can enroll in our platform, anyone can access our academy, anyone can access our APIs. We have no restrictions on those things. And then when it comes to bringing your study live, there's a decision point. Are you a commercial study or are you going to pay Actual money for this product? Or are you doing this for a nonprofit cause or for some underserved therapeutic area? So neglected tropical diseases, women's health, ultra rare diseases, they're all qualified on our platform to. To either receive a pro bono offer or a vastly reducted offer. And that's the beauty. You can build a very successful revenue engine that you focus the vast majority of your organization to. If you build a proper product that is actually delivering on the promise of SaaS, you should also be able to give it away for free to those that need it. And I think we do that very elegantly. It does, of course, generate some level of support, right? But support tickets, I mean, again, if you're a true SaaS platform, you'll know what the support tickets are. It's pretty easy to staff and automate a lot of those processes. So, honestly, if the only thing standing between you and making an impact on these underserved communities is the fact that you need to answer a few support tickets, I'd be like, hey, Get your shit together. However, a lot of people are just very money driven, right? So I've never been primarily money driven. But I understand we need to generate, shareholder returns. I've made a commitment to the VCs that invested in Castor and then to an extent also our employees with their ESOL plan that we are going to create returns for everyone. And I'm very committed to that. But that doesn't preclude you from also finding that impact. With the important callout being there, there is absolutely no way you could make any money in that segment anyway, right? So, either you help them out, and you do the right thing or not, right? Those are kind of the options. There's no way to kind of monetize that, that segment. Although there is, of course some metadata we get. We can get some learnings from those studies on terms of how the system is used and what is effective and what is not. So, yeah, I think you need to really think, what is the true revenue engine? And what can I then do on the side kind of lives feeds off that revenue engine that, that makes an impact on the world.
Dan Balcauski:that's fascinating. So just so I make sure I was tracking there. So you were saying that they could come in, they can use the platform, the APIs or the, or create an account. And then there's some sort of, right when they're looking at either like publishing their report or finalizing their data, that's when they sort of, you would hit a paywall if you're a commercial institution or one of these not for profit or underserved communities, and then you're able to make that distinction at that point.
Derk Arts:Yeah. So we so it's really about collecting the data. So it'd be opening the platform up to all these hospitals to all these patients. So for example, when you're not live, you can only add a certain number of fields to, to build your forms and your data model. You can only add a 10 up to 10 records, which are usually the trial participants and that's kind of the limit. So you can. Really get a good feel for what's possible. And then you need a You know a coupon or a billing code or whatever you want to call that. You basically need a license And that's so that's really where The fork in the road comes up, which I love. It's like a highly debated model. I will tell you that but I love it because it makes it extremely accessible and That's the whole point. It needs to be accessible to this underserved communities who don't have any funding and that's really something I stand quite firmly behind.
Dan Balcauski:That, that whole area is fascinating. I'm sure I could talk to you all day about the debates that have gone on about that model. This is called SaaS Scaling Secrets though. So I did want to ask, in your mind, what is the most important thing to get correct as the CEO of a scaling B2B SaaS company?
Derk Arts:Wow, that's a big jump. I mean, I've, I'm a huge subscriber to the good to great philosophies. I think they've been quite influential and there's like a lot of books, of course, that align with that. But I do think getting the right people in the right culture and is, I mean, I'm not saying anything new here, clearly. Like, I mean, this is what most people would say, but I think I've also seen that nailing that, really getting The right people in the right seat. So not just the right people, right? Like you can have like super driven, motivated people, but if it's not the right fit for what we need to do, you're still lost. And of course, being able to determine what the seat is. Now you start to connect it to product strategy and vision and all those things. But I think truly having a very clear mindset on like, who do we need to achieve what we're trying to achieve and how do we make sure that they perform well? And they create a culture where those people can really sort of be as effective as possible. So. Where they are empowered to, to use, to, to form the brain collective, if you will. I think that's absolutely essential because having that robust foundation of good, capable people in the right seat who work well together, who are empowered to think for themselves, allows you to absorb so much, right? Like scaling is a fucking pain in the ass, pardon my French. Like, I don't think I've ever heard a scaling story that didn't hurt to an extent because scaling implies. Larger volumes, scaling implies new customers that are more demanding, scaling implies enterprise customers who are on a whole other level in terms of demanding. And constantly feeling like you're catching up, right? That's the whole definition of scaling. Like you're not in a steady state you're constantly growing, expanding. So there's something moving. There's something always changing and shifting. Maybe not always, maybe it's not always a customer segment, although I think it's very common for that to be in the mix, just If it's just only pure volume, maybe if it's kind of more of a B to C play, still there will be all these surprises that you didn't anticipate. And you can have this amazing strategy and plan and go to market motion, everything's thought out, but in the end there's all this shit that's going to just hit you in the face. And then I think having people that are there to deal with it. That can think for themselves and that can work through those things is just absolutely crucial. Because I think otherwise scaling will just crush you. I mean, we've seen it many times, right? Scaling just crushes companies. And I think that's because that foundation isn't really there. There's a lot of excitement in the market. There's some kind of functional go to market motion to get things in the door. But then delivery just isn't there. And that's in the end.
Dan Balcauski:What do you think are some of the critical elements of Castro's culture that you believe have contributed to your success as you've scaled?
Derk Arts:I think, It's quite comfortable being a purpose driven company. I would highly recommend people starting, purpose driven companies because then you, it's much easier to find people who have a strong reason to come there. So actually caring makes a pretty big difference. Like obviously people want to make money and it's different per function, like what the balance is exactly. But a lot of people at Castor care about What we do, there's a lot of intrinsic motivation to show up and do the work. And then, of course, it's on the leadership to make sure people see the connection between the day to day work and the actual impact, right? So that's a lot of work to keep explaining, like, how are the quarterly OKRs tied to the annual OKRs tied to the overall, like, How does what you did today increase the human health span? You need to constantly reinforce that, but if you do that effectively, you have a highly motivated, aligned workforce that is much more likely to also be team players, than just to go for individual gain. So I think creating a purpose driven, non toxic culture that cares, but also has those elements of a performance based culture. I think that's why the intricacies start to come in. Is, is really crucial to to success, I would say.
Dan Balcauski:So, that's interesting. Yeah. Cause you know, you're sometimes it can be hard to just attach mission driven onto companies after the fact, I think you're in the health space maybe are more blessed. It's easier to do that, but let's just say for, a given role you're hiring and yeah you've agreed that, Hey, we want people who are coming in who actually care about, what we're trying to get done, right? They have some of that intrinsic motivation, that they're going to be aligned and really passionate about the mission we have and the way you've defined it is essential. And so you're sitting across from someone in an interview and, you're tasked with sort of leaving that interview with a point of view on if that, somebody has that, like, Talk to me a little bit about what is it that you're doing then in the conversation, in an interview, what you're looking for in order to vet that. Grit's
Derk Arts:to ask and to see how people respond. Honestly, some people just don't have an answer for it, which, I'm like, how did you make it this far in the process anyway? But because it seems like such an obvious question. But I think you start to glean some information from that to begin with, right? Because, let's say, some people have prepared. Some story around why they why they care. But then I think you can also become more concrete around one second. So I think you can start to become more concrete around, all right, so what in your career has happened that supports that, right? So, I mean, not maybe asking it on the spot like that, but basically bringing the narrative there. Well, talk to me about your previous role and why did you work there, et cetera, et cetera. So I think you can start to see a narrative of someone who truly is interested in that. Yeah. Dan Balcauski and Joe Rogan, CEO, B to B to C, B to D, B to B to C, B to D. Joe Rogan, CEO, B to C, B to D, B to D. We just need the right people and sometimes it's, people are money driven and that's totally fine, money driven is also highly predictable, right? So, I think this is not like a black and white thing where like everyone interviews with me and I kick them out of the door if they can't articulate why. They care about curing cancer, and that's not how it is. But I think there's a little bit of that, right? And we do a culture interview, and we do kind of speak to why Castor, and what is your alignment with that, and and seeing how people articulate that. So, it's one factor, it's definitely not, it's not all of it, for sure. I think Grits would be another major one, that I think has been effectively identified as a key contributor to success at a scaling SaaS company.
Dan Balcauski:another interesting one. How do you try to screen if someone has grit? I guess because, the, we're all. incentivized to put our best foot forward in an interview, both the company and the person. Right. So, yeah, it's it could be quite easy to be like, Oh yeah, I have grit, but is there things that you're particularly trying to poke and prod on to determine what their level of grit is?
Derk Arts:Yeah, and to be clear I'm not the inventor of any of these things, but I think questions of like, what is the hardest thing you've ever done, or what are you most proud of, or tell me about a situation where you really struggled and made it through. I think like just kind of where the baseline sits gives you an idea of of have people actually shown. You should have shown grit in the past and then I'm also, I think this is something that I was passionate about, but then one of my board members Vili Ilchev who you can find on LinkedIn, it's great, an amazing investor. He's like super like strict on like doing really good reference calls. So I was already doing that, but after meeting meeting him and having him on our board, I amped it up even further. And so I think. I see recruitment processes where references are kind of relegated to a written note. Yeah, and I vehemently like disagree with that approach. I think it's a really strong opportunity to ideally not too late in the process, get a really good view on how someone performed and, If you have the right person on the call and you ask the right questions, you get a lot of information out of it. And so I think that's another key area as part of recruitment to, to nail those references and not with some kind of standard set of questions, but like really listening. What are you hearing? What are you picking up? And seeing if you can follow that thread. Usually until people get a little bit uncomfortable. Like I don't really mind making people uncomfortable because I think that's when you get a lot of information. And then obviously I will respectfully back off when someone's like, I don't want to talk about that specifically. But I do think
Dan Balcauski:talk me through that in the, in terms of a reference call. Cause I think I agree with you in general, either reference calls get relegated to like, ah, we don't really need to do it because usually it's so late in the process and you're so excited. You finally found someone who's like, oh, like we don't, we'll just hire them. I'm sure they're fine. We've all done our good job. Or, folks are like, well, like, I don't really know what to ask. Cause if this person is listed as a reference, I mean, obviously the
Derk Arts:well, that's where it starts, Right. I don't, that's not my approach. I say, I would like to speak to that person or that person. And if I can't find like from an org chart or LinkedIn, like who that person is, I say I want to speak to, appear in another team, like be super specific. So there's not a lot of, there's not a lot of picking. And that doesn't always work. Sometimes it's not possible. Very often it is. I try to dictate the references that we get, and then I try to ideally find a couple on my own, and sometimes it's like, I would like to speak to this person, and they're like, well, that's not possible. Aha, alright, so why can't I speak to that person? So yeah, I think taking charge of who the references are, as opposed to being like, oh, just give me a couple of references. Yeah, I mean, clearly, you get some selection, but even then, I think things like, I would ask maybe, Was there anyone in that role that was, that performed better than this person? And then if the answer is no, then it's like, well, why? Like, it's not just like yes or no, it's like, well, why? Or what happened? Or who maybe had some constructive thoughts about this person, and then, don't have to name names, but really getting into the nitty gritty of how was this person perceived in the organization. So really, I'm trying to not just listen to this one person in front of me, like what they thought of this person. I really try to see if I can visualize how they performed in the org. And sometimes I use that to ask for an additional reference, like, Oh, I would like to speak to that person. so, and that again, it doesn't always work, but I usually get quite a lot out of those calls. And sometimes the most valuable thing is actually knowing what to coach someone on going forward.
Dan Balcauski:I love that. So, so really taking control of who is being called in the reference process, and then also asking, trying to get sort of a 360 view, not just that person's perspective, but how were they perceived by others. And actually, I really liked that last part too, because I think one thing is it gives the person on the other end a little bit of a more freedom to talk about the person. Cause it's not them saying that this person was so and so, but it's saying like, they were perceived, they, some, they were sometimes perceived by others, or they had this reputation which could provide that person a little bit of psychological safety, where they may feel a little awkward. It's like, well, I don't, I thought that was unfair because X, Y, Z, but some other people thought so it gives them a little bit of a way out. I love that. Going back to kind of culture overall, I know when we were talking before that you mentioned one thing that you really value in kind of the Castor as a whole, and the culture is really caring about your employee's health. Could you kind of share why that's so important to you or like in any specific ways you've helped to cultivate that within the organization?
Derk Arts:Yeah. I mean, A, I'm an MD, so like I know what bad looks like. And I don't know how big mental health is as a disease burden globally. And so I would feel like I would be how do you say this? I feel I have a responsibility, basically, to take care of people, just with that background. Like, I, ultimately, I swore an oath, and I feel that extends here, too. But, aside from that I think a lot of people underestimate that There is a finite number of productive hours in a week for any given person and maybe for me It's 50 if I you know, try to give myself a lot of credit But I have I am like in a very energetic person And I know how to organize myself and that requires a lot of exercise and all those things But then I can squeeze a lot of productive hours out And for some people maybe it already ends at 30. The point is trying to squeeze more out of people Than they have doesn't actually yield anything Even in the short term, right, because what you're going to get is like poor quality work in those remaining hours and all the work will be worse. So I would have much rather have people spend more time prioritizing and considering what is actually important, what actually moves the needle and then relentlessly pursuing that and having time to exercise and to sleep well and to do all those things and then go at it again and try to spend 80 hours across all these tasks that include a lot of mundane shit that doesn't actually move the needle in any way, but then. Everything becomes like a blurry mix, and then worse, people burn out, and a burnout is so insanely expensive and complicated. I mean, even in the US it's painful. In Europe, it's on a whole nother level. And I think a lot of leaders or let's say manager, CEO, whatever, they just underestimate the cost, opportunity cost and actual cost of that happening. So, I think really, like, I genuinely care. Even without those business considerations, but I think if I try to explain to someone why does it make sense to give people enough PTO and to make sure that they exercise and to sort of stimulate that, well, they're going to be more productive for longer. That's the simple the simple truth. So yeah I'm quite passionate about that. And I do believe sometimes something just needs to get done, right? So boom, pedal to the metal. Let's fucking go. Let's be demanding. I think that's really It's been a developmental journey for Castor. I would say we started out too nice on the culture side, like, it was all about We were bootstrapped for five years, so you have to create an interesting vibe, there's really no external pressures. And so, I think we, we learned a lot from that journey. And now I'm really trying to find the right plan. Like, how can we focus on results? How can we have a performance driven culture and still take care of our people, still give people time to recover? Well, clearly the answer is prioritization and just continuing to lead by example. And I think that makes the most sense for everyone involved.
Dan Balcauski:So that makes perfect sense in terms of like, obviously your background making sure that you value people's mental health. And I, I don't know if there's a leader, there probably are CEO leaders out there who are maybe psychopaths and don't care. But I think most leaders would care about their employees. Mental and physical wellbeing. How do you. Maybe this is easier to track, when you're small or sort of maybe with your direct reports where you could kind of, get the one to one, read on what's going on with them. Are there ways that you've tried to, systematize that as your organization is scaled? Like, how do you know that like, mental health across the board is well, like, are there any specific ways you've tried to cultivate that within the organization?
Derk Arts:There's many things, right? I think it was easier when we weren't fully remote. As we are now because then we would actually like go and exercise together and we'd organize runs and stuff. And, it would be just company activities. But I think now, it's a lot of factors. It's. Sounds a bit lame, but you know, one of our core values is a happy and healthy team can achieve anything. And that's actually one of the core values people appreciate the most. Like sometimes when we speak about those things or we survey around values, that's really like, it's a value that resonates really well with people and it's really well understood. And also really easy to apply. And so what you see is that there's a lot of respect for people's time off. In general, and we try to lead by example with that. So again, sometimes there's an exception, but then it's obvious it's an exception. I think it's also pretty clear that there's no expectation to work more than the 40 hours. It does happen, I will say, and I think it has happened more in the past Two and even four years started during COVID and it's kind of crept in and also because we're much more global now. I'm in the U. S. now, a lot of teams in Europe. So like, there's people selecting from the U. S. and it's tempting for the Europeans to respond to that. And we're still kind of working through how to best deal with that for people to allow people to switch off and let them know it's okay. But we're pretty explicit about that. Like we literally go and say, Hey, I say to people, why are you responding right now? Like I'm working. It's 10 p. m. for you, like, what are you doing? And so we do have, I think, a culture of calling those things out, to actually taking the PTO, to just showing that's okay. And stuff for a lot of people, specifically coming from other companies, like, they are like, well, I'm on PTO, but I'm still supposed to show up, right? Well, no, that's not the point.
Dan Balcauski:And responding to email
Derk Arts:yeah, exactly. And so it's a lot of leading by example. It's values. It's, the Slack channels around wellness and fitness. And me also just. We have these vision and impact sessions, like, reiterating on how important it is to recover, to be more productive. Like, I tell everyone, exercise is productive time, like, that is a productive way to spend your time. Castor will benefit from it if you exercise. And I believe that deeply and then try to, also over sleep course, for example. So everyone can sign up for sleep course to help them sleep better because everyone, like, a lot of people are stressed. I hate that. It's just the reality. Like, I wish I could wave a magic wand and remove stress. But yeah, scaling companies, there is stress. People want to do a good job. It affects sleep, and if sleep is affected, everything comes fucking falling down. And so we offer these sleep courses to give people actual, like, CBT by a psychiatrist to help them deal with when your mind is racing, what do you do when you lay awake in your bed etc. So, ultimately, it's a ton of initiatives, but I think it starts with that value of, like, we actually believe that this is the right thing to do, but also the best, the most business sense.
Dan Balcauski:I love that. So I heard a couple of things of just, making sure that it's constantly reiterated as a value, leading by example not expecting people to reply at all hours on Slack with the global team. And I'm sure you labeled several other key points there that were, are very useful. Let me ask you. So kind of going to your own mental health, obviously leading leading a growing B to B SaaS company can be very stressful in its own right. And, your industry, particularly healthcare, has gone through some extreme volatility in the last few years, both with COVID, which was, I don't know if it was a blessing or a curse for your industry, but that also saw a lot of pullback in across the board in biotech and broadly as different interest rate regimes have changed and the, impact of things like the Ukraine war have happened. How has that affect, volatility affected you? What have you learned about yourself leading and scaling a company over these last few years?
Derk Arts:Well, I've learned that I have a pretty high degree of mental toughness and that's I'm blessed. And that also, that always makes me wonder, like, how should we raise our kids? But anyway, that's a very long tangent that we shouldn't go down to. But the, the key is, I mean, yeah, this is, there's so many aspects to this question. And I think I came into, like, the high stress period already having A strong belief in like, healthy mind, healthy body, and vice versa. So I already knew I needed to exercise. I have pretty strong ADHD tendencies. And so like, HSD, like exercise is a huge part of that anyway. Meditation, of course, is also something that was on my radar for a long time. So I think I had pretty good practices to begin with, but I think a key tool in the tool belt for me is also Stoicism, or, there's actually a number of philosophies that apply. So, this is one that's pretty accessible and there's a, So, a couple of pretty good books on how to apply that to your actual daily life. And so, things like negative visualizations, what is the worst possible outcome here and how bad is that truly? Only being concerned about the things we truly control, or at least in our sphere of control, and not wasting energy on outside events. I mean, all those things together are very powerful, and I think I've picked up a habit of just on a daily basis going through that. However, I still get frustrated. which is frustrating in itself. I have just a, my baseline energy is just pretty intense and, energetic, and I'm not by, like, by default the stoic sage who just assess, like, assesses everything calmly. I try to be, but it's pretty far from my natural state. But I try to take the best from both worlds. I think ultimately if there's a problem, we're here now. What's the worst possible outcome? Let's just calmly assess the situation and move forward. And what's the worst that could happen? And I think I probably do that like ten times a day at this point, combined with the exercise and taking the breaks, etc. So, I've I know that even if I feel shit, if I just apply the system, two days later I will feel fine. I've rarely felt shit for like a week in a row or something like that, it's always, okay, I acknowledge the feelings, I know what's happening, I know I need to get back to the system and because I know it works, I also do it, I've seen it to be effective. So it takes a while to get into that cadence but I would highly recommend everyone being, building up that process and cycle for when things go bad, you actually trust the process and you stick with it because then you'll also navigate out. I see a lot of people just spiraling out of control when things go bad, because the, There's so much system they had that falls apart at the first, notion of trouble. Like, they stop exercising, they start sleeping worse. Now suddenly we're in this vicious cycle. It's very hard to get out of. So you need very strong systems and processes for yourself to really, power through the difficult times, of which there will be many.
Dan Balcauski:Well, as a fellow ADHD sufferer, I resonate with a lot of what you just said. Was the, was your interest in meditation sparked by trying to get a hold of the ADD symptoms? Cause that's how I got into meditation. Or did you come through from another path?
Derk Arts:Yeah probably. It's a long time ago. I think it stemmed from, also like 7 Habits for Highly Affected People, like whatever, I've, like, I've read all the books and like there's all these little things that stick, but how do I create this mental focus, how do I, my biggest weakness is This shiny object syndrome being all over the place, like, context switching very quickly. And then sometimes I even feel like very capable when I can just jump from left to right and boom, hot swap into things. But it also creates a ton of chaos around you, right? So I think that the realization of my own limitations and trying to sort of create more mental focus and quiet I think was one of the reasons I got into that. And then really also just dealing with these negative thoughts that can sometimes kind of go around.
Dan Balcauski:Yeah, there's a great phrase I like from one of the ADHD specialists who said whenever you get a task, it's like it either has to be done right now or maybe never. So you had to always end up in this, these two worlds and then frustrated by which of them you put it in. Man, I could talk to you all day Derk I do want to ask you a couple of rapid fire questions to close out here. What do you think about all the spectacular people you've had a chance to work with? Is there anyone who pops to mind that has a disproportionate effect on the way that you think about building and scaling companies now?
Derk Arts:I think the short answer is no. I think it's ultimately a lot of people. I am a huge believer in the subtleties of the world. Like, everything has a context. Unfortunately, almost all decisions have to be binary. You just have to accept that. Like, there's usually no middle ground on a decision, like either you do or you don't. Very Yoda like. But in reality, almost all the people around you have something that is valuable. To learn from, right, or to stick with. And then they usually also have a couple of aspects that aren't something you should probably seek to seek to mimic or copy. So I feel like it sounds like a very kind of politically correct answer, but I think I, I learn from almost everyone and try to be deliberate in like, hey, what do I think I should learn from this and what should I not do? Right now I have I'm lucky to be working with Frans van Houten, who used to be the CEO at Philips. A very large healthcare technology company. And obviously it's very interesting for me to be able to work with someone like that. Like, how do you run a business that is thousands of times bigger than than LanCastor? To also have like the dot on the horizon of like, all right, maybe what I'm doing right now works, but how do I continue to evolve and develop? But just every year in the journey, there's been people that Have been inspirational, have taught me something.
Dan Balcauski:What's was it Francois? Is that, what's his name?
Derk Arts:His name is Frans van Houten, Dutch
Dan Balcauski:Frans. Frans. So, is there anything that Frans has told you that has a piece of advice that's particularly stuck out to you?
Derk Arts:Well I think part of it is I've, I developed this tendency to push away a lot of the, kind of, I for simplicity's sake, let's call them HDSD trades. Like, I see this opportunity, I see this thing, we could innovate like that, like, I really started pushing that down because, A lot of failure stems from CEOs not being able to focus, not creating focus for their teams, not being able to prioritize, and then everyone's working on everything at the same time and nothing gets done. So I've gotten really, like, I just have these thoughts in my head and I'll put them on a list somewhere, but I'm not going to distract people with it. And the thing is like, well, yes, that's all true. And, also, there's validity to a lot of these ideas. And so how do you create an environment where you can do, where you can experiment and fail and test, Without it necessarily affecting the whole organization. All right. So it really was like, yeah, how do I not walk away from some of the best ideas and opportunities? While at the same time, not giving everyone the feeling that every week is something else. By the way, I stopped doing that a long time ago. It's one of the first things I learned from a lot of people, like from executive leadership, like Derk. Don't. Don't distract people with new ideas. They think it's in order. I'm like just like channeling ideas around people like oh I need to change what I'm working on. No, that wasn't actually the intent I just wanted to throw this idea around So I think I pulled it back very far and I'm like, yeah No, the challenge is how do you create an environment with a space for both, 90 percent relentless focus on execution on what's right in front of us with clear priorities and maybe 10 percent of like yeah Let's fucking experiment and innovate and see what comes out of that. So I think that was a, I need a little push to not second guess that kind of that side of me,
Dan Balcauski:Got it. If I give you a billboard and you can put anything on it, other advice for other B to B SaaS CEOs trying to scale their companies, what would you put on the billboard?
Derk Arts:work on self awareness lack of self awareness is so incredibly common and it's exhausting to me personally. And it always leads to bad results. Like fine. If you're a little bit narcissistic, you probably need that to survive as a CEO. But then no, that too. I know where you're strong. I know where you're weak and don't be. Don't be weak around your weaknesses. Like, so exhausting. So many people I see who don't want to admit that there's a single weakness. Well, I guarantee you that is going to come back to haunt you. So I think if you start with self awareness, you can build this whole world around you to tap into where you're strong, but also to counteract where you're weak. And that's going to be key.
Dan Balcauski:Work on your self awareness. If Derk, this has been great. If folks want to learn more about you or Castor or follow you on the internet where can they do that?
Derk Arts:Briefly considered like getting into Twitter X but you know, for me, it's LinkedIn is where I'm at. So you can find me on LinkedIn and follow me there. Or connect with me there and happy to share more repurposed ideas from other people.
Dan Balcauski:I will put that in the show notes for listeners. Everyone, that wraps up this episode of SaaS Scaling Secrets. Thank you, Derk, for sharing his journey, insights, and valuable tips. For our listeners, if you found this conversation as enlightening as I did, remember to subscribe so you don't miss out on future episodes.
