Episode 80 – Building a Sellable Company – Antonio Ramirez, Founder of Pixel506

Katie Hankinson: (00:00)

Welcome to Building While Flying a Sasha Group podcast, where we interview business leaders about how they tackle challenges, stay resilient and navigate ever-changing skies.

 

Maribel Lara: (00:12)

Welcome to Building While flying. Uh, today my guest is Antonio Ramirez, founder of Pixel506, Pixel506 is a digital innovation agency that helps companies with creative solutions, strategy services, technology services, and digital marketing services. Pixel five oh six is a Brooklyn born company with nearshore teams in Costa Rica BEU and Nicaragua powering UX marketing, and software development teams to create products and services that boost sales in the digital space. Their pixel perfect solutions are built to meet the specific needs of clients, regardless of industry or business size Antonia. This is my first time, my first time interviewing a client for building wall flying. And I’m very excited that it’s you. Um, we had the pleasure of working together for three years. Um, you were part of our mentors program, which is an offering that falls under my purview as head of consulting at the Sasha group. So I’m really excited for this conversation today. Uh, so welcome MI mini. Um, I wanted to start by having you share with our listeners like the origin story to pixel.

 

Antonio Ramirez: (01:27)

Well, first of all, thank you so much for having me here. And I gotta say we, we could, we could have never chosen a better partner, like, like the Saha group and the Vayner team to help us grow our company to where we are today and, uh, happy to be here. Um, pixel, uh, I moved to New York about 13 years ago or 14. I don’t remember maybe 14, 2008. And I went to NYU. Um, and then my thesis graduation project was pixel 5 0 6. I always saw the need back back in, in 2008, uh, near shoring or hiring teams out of Latin, Latin America was not as popular. Most companies were hiring people over in Indiana Asia. And while I was there, I was like, you know what? It will make a lot of sense to bring the two together. Us is in the same time zone as LATAM, right?

 

Antonio Ramirez: (02:25)

Maybe one hour difference and there’s great talent. The, the reason they didn’t hire anybody is because they didn’t know anybody. Right. But it was me, New York, uh, hustling and knocking on doors and, and providing the service and the face to LATAM for all these companies so that they feel comfortable to hire LATAM, uh, talent. Uh, and so then pixel came about and actually the name, uh, means pixel, which is the technology portion of it. And then you have the 5 0 6, which is the Costa Rica country code that is also a green country. Right. And then bringing the two together was the merge of technology and LATAM us and, uh, Costa Rica, my native Costa Rica.

 

Maribel Lara: (03:12)

So an Antonio, you referenced something in your response that I wanted to point out, uh, right. I remember three and a half years ago when we first met and started having this conversation, it was a struggle to get people to understand like why Latin America was a great place to source talent and to work with partners fast forward. We’ve now gone through this pandemic that has opened people’s eyes to right. Opened the eyes of a lot of companies to realizing right. That talent doesn’t have to be right in their backyard. Um, and so it’s so fascinating to me that really, I feel like every other week I’m reading an article about offshoring and there are more and more conversations about talent in Latin America being a really great source. Um, and so I, out of curiosity, like how does that make you feel? Cuz I think right, you can, you can go positive in that or you can go, you can be frustrated in that. How does it make you feel? Like, what are your thoughts about that and how that landscape has changed?

 

Antonio Ramirez: (04:16)

Yeah. You know what, uh, living in the us for so long, uh, I, I got to realize there’s, there’s a couple of things that you have to, uh, overcome, right? One of them is rejection, but one of them is rejection in business. Right. So when you go and you pitch a client and they say, great, I love you. You know, I love the solution. And then you say, well, by the way, have the team is in Costa Rica or NICAR or somewhere else. They’re like, eh, you know what? I don’t know. It could be in Chattooga, it’ll be okay. It could be somewhere in the middle of Texas. It’ll be okay. But if it’s just outside the border, people hesitate because they don’t know what’s gonna happen. So fast forwarding. Uh, so it was, it was really hard to sell. Like it was really hard to, uh, give the trust to the client that things are gonna be okay.

 

Antonio Ramirez: (05:05)

And the ones who took the, the leap of faith with us, just like we did with you guys, uh, have seen the benefits for many years, even before the pandemic. Right? So they, they got the, uh, the right developers at the right time, right. 10 years ago. Uh, now it’s harder to get those developers, right? So, so some companies took the leap of faith, some companies didn’t and now they’re coming back. So there’s a lot of those companies saying, Hey, you know what, uh, uh, I, I remember you were selling, uh, nearshoring from people from Costa Rica and, and these are the rates that you sent me 10 years ago. I’m like, well, by the way, this has increased a lot, right? Because every us company is down here. Every major company has an office, either in Costa Rica or colo. And it is just been a boom since the pandemic.

 

Antonio Ramirez: (05:58)

I think that stigma of everybody has to be in the us changed mm-hmm and companies started to be completely open about, you know, what, this guy’s in colo. I don’t care. Work is great. Talent is in Costa Rica. Things are going well. It’s totally fine. I think one of the, the, the ways we went about it was to, as you, as you mentioned, pixel was, uh, created in Brooklyn, New York. So to the customer, uh, they were hiring a us company under us laws. Right. And the governance of the team was overseen by a us company, which was XO 5 0 6. And then, uh, um, we, we started to educate the clients that, you know, intellectual property and the source code and all these other things belonged to them, even though they were developed in, in Latin America and that there was no copycat, right? Like there was no taking this code from one client to right. Create your thing. So all that we took into consideration. And so that make the client’s trust became more and more, uh, to work with us, uh, in a positive way.

 

Maribel Lara: (07:08)

And I would imagine you just sort of feel like I would feel a sense of like, yes, people are getting there now. Right. And so I would imagine today, you’re doing less trying to convince folks and have the benefit of saying like, Hey, this isn’t new to us. We’ve actually been doing this for, for several years now.

 

Antonio Ramirez: (07:29)

Yeah. That is correct. So clients don’t even ask anymore clients when they hire us. They see, we have a Costa Rica office and they, they know we have a Brooklyn office. So now it’s like, oh cool. Now I’m working with Costa Rica. This is awesome. Right. Where do I pay you? Oh, pay us in the states. Okay, great. So, uh, now nobody even ask, they just want the talent and that’s what matters. Right. So competition is really high in LATAM to get talent. The fight for talent has probably the us saw this, uh, I don’t know, maybe 20 years ago, but in LA time now it’s happening where you have people fighting for talent so much that it’s, uh, it’s, it’s interesting. Right. Because it creates that competition and you have to be really good.

 

Maribel Lara: (08:13)

Yeah. Okay. So let’s get to one of the reasons I was most excited about this conversation. Um, and that’s because our podcast is called building wall flying. Right. Um, and I think that you have built towards a very specific goal that we haven’t necessarily talked about on the podcast yet, and that’s building to sell. So, um, congratulations to you. Um, you recently announced the sale of pixel 5 0 6, uh, to a company called 10 pearls. Um, and you’re gonna be remaining at pixel. So we’re gonna wanna talk about that too. Um, but that’s a very right. That is a very, um, specific type of growth to seek out. And so right. Growing a company for the potential of selling it. So I wanted to start by first asking you, at what point did you realize that you were building this? You were, that you were building pixel 5 0 6 for a potential sale. Um, and then how much time passed and what did that journey look like from the point you realized that might be the path you were going down to this sale to 10 pearls.

 

Antonio Ramirez: (09:23)

That’s a, that’s a great, great question. Um, I think every entrepreneur starts a company without knowing what’s happening or how to build for sale or for anything, you start the company. Right. And then people start asking you, Hey, what’s the strategy? Right? So there’s two things. I didn’t know. So first of all, I, I, I didn’t grow up in the states. I grew up in Costa Rica and then I moved to states to study there. When I started pixel, I didn’t know, you can go and raise money. I didn’t know. You can go to a, to a, a, a venture capital firm and raise money or talk to some investors that, that doesn’t happen in Latin America. You don’t go to investors, you go to a family and you raise some money and that’s about it, right. also, you don’t sell companies in Latin America, right?

 

Antonio Ramirez: (10:09)

You’re, you’re stick with that company and you, hopefully you can pass it through your grandkids, right? So it’s a very different approach. And all this I learned in the us, um, I was building the company. All I wanted to get is some sales. I was hustling. I was getting some sales. And I remember being at the NYU incubator and everybody was raising money and I was doing sales. Right. So, and they, they all saw me like this guy doesn’t know how to start a business, but I was just focusing on sales. So, um, because we focus so much on the sales fast forward, 10 years from that, um, we grew into space. That is the, is, is like a space that was not, um, companies were not looking at that space. And is it’s a company that is between tech and is between digital marketing.

 

Antonio Ramirez: (11:01)

That’s where pixel is. We understand tech, I’m a software engineer. Uh, uh, and then we understand digital marketing, right? So we saw that connection. We created pixel so more and more direct customers is starting to request services from us, right. Maybe three years ago. Uh, so at that, at that point, some companies said, uh, you know what? We would like to bring you in house. We didn’t want to be in house of a company. We wanted to take the investment, but we didn’t want to be a, a one shop for one brand. We wanted to be working for many customers. So that was, that was probably the first note that we said to an acquisition. And then the idea of an acquisition started to roll in my head, but I didn’t know anything about acquisitions, right? I thought it was easier. Fast forward, maybe three years ago, um, LATAM became really, really popular.

 

Antonio Ramirez: (11:51)

And a lot of us companies saw the potential of cost companies or Latin companies. If they acquired those companies, they will acquire their talent, but they didn’t know. And this is very interesting. Us companies didn’t know that Costa Rican company can have clients in the us direct clients in the us. And that changed the game. I believe because in the past three years we got probably 10 offers to purchase pixel. Some of those offers, they came to us, uh, just for money. Like they just wanted to, Hey, we we’ll buy your company. Okay. What else do you provide? Nothing. I here’s some money out, we’ll buy your company. And then out of those stem, maybe we, we came down to three that actually were like very good. Like we said, we can grow with these guys. And they saw the potential that we can sell to us companies from Lapan.

 

Antonio Ramirez: (12:42)

Um, so what I’m trying to say is the market has changed. And since we started the company, we were not thinking of selling, but maybe three years ago, when we met you guys, we started to say, you know what, let’s, let’s build a company that can be sellable at any time. And that takes a lot of time and effort because you have to be super organized. Your goals have to be met. I remember when we met with you, probably our, our pitch deck was not the best . Um, when we met with you guys and messaging was not as strong. I remember you used to challenge us a lot about the messaging. Um, and when we took the leap of faith with you guys, we started to think this, how you, this is how you built a bigger company, right? This is not how you go from zero to a million to 2 million. This is how you go to 10 million, right? This is how you, how this is how you assemble a company. Uh, and then we learned a lot from you guys and what you and Gary and, and the executive team there has built, uh, because by not doing that, we could have never achieved the sell pixel.

 

Maribel Lara: (13:54)

Well, thank you for that. Um, but it only works, right. If we have clients who take our recommendations and act on them. So thank you for being a good client and acting on those recommendations. So let’s talk about, um, what it looks like now, because you are still at pixel 5 0 6. Um, and so how has your role, or how will your role, because we are still at the very beginning, how will your role change? And this is really the, how are you building offline because you’ve now successfully achieved this sale that you suspected might be in the works over the, the course of the last few years. Um, what is your role now, um, that you’ve sold. Um, and, and what are you looking forward to in the next year or so

 

Antonio Ramirez: (14:43)

That’s a great question. You know how Gary always says that a, a true entrepreneur will be suffocated if he’s doing something else? Uh, I’m that person, right? Like, I cannot, I cannot really be like, uh, you know, in, in one role, like, I like the sales, I like the finance. I like to grow the business. I like to do many things, but so coming, seeing this opportunity of temporals acquiring pixel, uh, was great. Uh, when we met with the CEO, his vision is very broad. There’s some micromanaging and there’s a lot of room to grow. So, um, a lot of it was the decision. Two, two decisions came about one is, is this the right partner for pixel to grow pixel, right? Is this the right partner? Two, the team, right? Most people will think, you know, as a business owner or as an entrepreneur, you think about yourself, believe it or not, most business owners think about their employees, right?

 

Antonio Ramirez: (15:40)

So we thought this is a great opportunity for the team to scale up. This is a great opportunity for the company to scale up. So this is a great opportunity for everybody. Second thing is they brought a lot of, uh, incentives for the team to grow. And that was, that was really good. These deals are very complex. Um, so you know how you have the, the value of the company, then you have the earn out and then you have salaries, et cetera. So all that was really cool. Uh, but then also I sat down with the, with the CEO of temple Pearl’s in interim. And I said, look, yeah, we’re looking to grow. This is a vision that we’ve been working towards. What do you think? He says, it’s very aligned to what we do, right. Because you know how in pixel we say, think, create and grow, right?

 

Antonio Ramirez: (16:30)

Think outside the box, like, let’s, let’s think about solutions, right. Then you create, that’s the team doing the work and putting those solutions that you just thought about into work and then grow as the marketing piece of it. And then in the temporal side of things, they also have the same mantra with different titles, right? So they have innovate, um, create an augment. So it’s almost the same thing. So the vision was very aligned. So my title, uh, I’m director of digital, uh, worldwide, uh, which is pretty much what pixel has been, except I’m not CEO anymore. Um, but I do the managing directing for America teams.

 

Maribel Lara: (17:12)

Amazing as,

 

Antonio Ramirez: (17:13)

And then Jessica co-founder she’s VP of marketing global. And then, uh, yeah, that’s, that’s who we are now.

 

Maribel Lara: (17:23)

I love it. Right. You did so much work to really strengthen the culture at pixel 5 0 6. And so it makes so much sense to me that you would be in tune to what opportunities existed for the members of that team. Um, so important when you think about a sale, right? I think the last thing you want is for what you built over the last several years to sort of fall apart because of a sale. Um, and so it’s, it’s really fantastic news to hear that you found a partner really, right? Like, yes, it’s a sale, but still you found an opportunity, um, that is, that has the potential be to be tremendously beneficial for the individual employees in addition to that leadership team. So I’m really excited to see what comes next for all of you. Um, my last question is you have referenced multiple times what a learning curve it was. Um, and in the effort to have entrepreneurs also considering a sale potentially may, you know, have a, a leg up, what recommendations would you have for them, um, to prepare or educate themselves for, for a sale,

 

Antonio Ramirez: (18:41)

Right. I, I think, I think a lot of, yeah, I’ve been talking to some entrepreneurs, they already started to ask me for, you know, for calls to give advice, et cetera. And I gotta say, this is, this is, I always told my wife, Jessica, my co-founder, I said to me, an entrepreneur has different stages. And one of those stages in, in, in my book, in my dream is to be hopefully an investor in advisor to many companies, right. LATAM or us happy to help anybody, uh, anybody that hustles. Right. So, um, yeah, so the, the, the goal here is to, to grow right, and to prepare, to grow most entrepreneurs. And I was an incubator with 200 startups. A, a lot of it was, and Gary talks about it. A lot of it was raise money, right. It was just, oh, let’s raise money. Let’s raise money.

 

Antonio Ramirez: (19:40)

Okay. Let’s provide value. It’s a different thing. Let’s create a company that provides value that states through time, it’s a different thing. It’s a different strategy. Um, but then you learn, right. If, if you build the company right now and you wanna spin it off and, and sell it in, in a year or two, maybe your goals are too small. It took us 12 years to create pixel and sell pixel, right. It’s not something that we created two years ago. And through that, we learned so many things that when a purchaser or, or a buyer comes to us and they say, you know what, I’ll give you a million dollars for that company. You’re gonna be like, no, because this company has so much value value in, in value proposition value in employees, value for clients value, et cetera. Right? So there’s a lot of value.

 

Antonio Ramirez: (20:26)

I will say, as an entrepreneur, you have to build a lot of value, uh, for the company and for the customer. Right? And then you can start thinking this, this my exit strategy, right? Because otherwise there’s nothing to sell. And I remember a couple of entrepreneurs, uh, friends of mine, Mario chales who created a, an amazing company, huge company, uh, 1500 employees. Um, so many countries, I remember at some point, I was like, Hey, Mario, I wanna, uh, I got this opportunity to sell pixel. And he was like, what’s third to sell. There’s nothing to sell. You have to keep building. I’m like, oh my God. . And um, little, little I understood at that time, but I think, uh, read a lot, a lot about sales, mergers, and acquisitions finance. You have to educate yourself, right. Not on what you do every day on other things that you don’t know how to do, and I will bring you there.

 

Maribel Lara: (21:23)

Yeah. And I will add, right. You had clarity on what you were looking for from a sale. You had clarity on what your company values were and you did the work to find values alignment, right. So I think you have to have clarity on who you are as a company, um, in order to find the right fit is, is another piece of it. Um, I also will give you credit. Cause I think you do a great job of tapping into your network and asking questions. Right? Cause I think that there’s a vulnerability in saying, I don’t know everything about this topic and being willing to say to people like, I don’t know what I’m supposed to know here. So tell me what I’m supposed to know. So, um, I would add that a little bit of vulnerability and willingness to say, like, I do not have all of the information and expertise in this area, so I’m gonna seek out the knowledge.

 

Antonio Ramirez: (22:18)

I, I never hesitated to ask for advice. And you know, when, when I met you and James, I remember the first day I came, uh, to your office and we sat with James and I was like, this is what we have to do. No matter how much it’s gonna cost us, we have to do this. But I tell you why there’s coaches, right. Coaches, they study to be a coach. And there’s people that actually been through it. Right. And it’s way, way different. So the advice somebody that has been through it can give you is, is, is goal, right? Like entrepreneurs, people that has run companies, big companies or small companies, but they’ve been through it. They are the only ones that can actually give you an advice for growth. And that’s what you guys did. I remember, I remember the one time I called James and I was like, Hey James, you know what, I need more office space. And every, everybody will say, get space for, for growth. That doesn’t help me. Right. I remember James saying, if it doesn’t exceed 4% of your sales, then get it. I’m like, oh wow, this makes more sense. Right? Yeah.

 

Maribel Lara: (23:23)

I start finding guys. So for folks who, who are wondering, who is this mysterious James, right? Because we might have people listen to this episode and not have context on the Sasha group. Um, Antonio is referring to James Orsini, who is president of the Sasha group, formerly COO of, um, of Vayner X. And so he is absolutely a wealth of information, um, right. He’s, he’s my go to for finance operations, um, questions and is incredibly involved in our mentors program. So I just wanna make sure people know who this James that we keep mentioning

 

Antonio Ramirez: (23:59)

Is secret. James

 

Maribel Lara: (24:00)

Secret James, um, Antonio, this has been a pleasure. I, again, incredibly excited for you and for Jessica, um, your wife and co-founder, um, and I’m eager to, to watch, um, and celebrate what the next steps for the, both of you and for the team at Pixar.

 

Antonio Ramirez: (24:19)

Thank you so much for having me. And it’s a pleasure. Hopefully we can grow together.

 

Maribel Lara: (24:24)

Yes.

 

Katie Hankinson: (24:32)

Welcome to building while flying a Saha group podcast, where we interview business leaders about how they tackle challenges, stay resilient and navigate ever changing skies.