Field Notes: Sherpa

My background is in procurement technology. I noticed that a lot was moving in that space, but workforce management, nothing was moving. It was completely left behind, even though it's such a big piece of procurement spend. It made me think, why is everything else progressing so fast while this space is left behind, with these archaic ways of working?

That made it more attractive to go after, because it's not a space with a hundred different competitors doing slightly different things. It's mostly big, legacy, old ways of doing things.

We help companies end-to-end manage their external workforce, so that’s anyone not on their own payroll. That's everything from helping them manage this workforce in a compliant way, classifying workers correctly, through to helping them manage their costs and understand what they're spending their money on, and to make sure they’re getting maximum ROI from it.

Over the last 20 years companies have pushed more of their work externally. Large enterprises 20 years ago might have had 10–15–20% of their workforce outsourced or external; now it's 30–50%. In some departments it's even higher. I was speaking with a large food manufacturer where 80% of their IT department is now external.

The shift is happening faster because companies need to change faster. External workforce gives flexibility: the ability to bring in the right talent at the right time, instead of being bound by rigid internal hiring and growth processes.

A modern example: look at OpenAI. They launched a model with Sora, then decided it didn't align with their strategy and cut or shifted that team. Their strategies are shifting much faster now, and larger companies struggle to do that fast. We want to enable them to do that.

100%. And there's a misconception that external workforce is cheaper or lower-skilled, that's not true at all. Often it's more expensive than internal resources. It's more about flexibility, and being able to bring in specific talent or capabilities you might not need (or want) to build internally. If it's not strategic to your business, but you need it for a defined period, external work is the best way forward.

We want to be a small, nimble, very talent-dense team. We set an internal goal around specific metrics we want to hit with a specific number of people. It's ambitious, but because of the technology, we believe we can do it.

Everything that isn't building new products or helping customers can be automated by agents. We can automate a lot internally too — operations, HR, and so on — so everything is self-served by agents in the background, and we can just focus on building the best product and talking to customers as much as possible.

That's the goal. But there's obviously massive value in bringing in people with specific expertise across different functions, rather than building up massive teams around them. It's more about how they bring in their expertise and use technology to build the structure they want within the organisation.

We're 6 people right now, heavily weighted toward engineering and product. That's the focus right now, because it's a big, quite compliance-heavy product to build. We needed to spend the right amount of time upfront doing it right, rather than optimising for speed to market, building the right foundation we can accelerate from later.

There's constantly stuff that comes up that you think, "I didn't expect to have to deal with that", but you learn to get through it. Being spread across two continents brings its own fun challenges, and there are certain challenges that come with being a company in Europe, or in Germany specifically, but you just work through it. It is what it is.

I think what's cool to see is people willing to help, even at big companies. There are people willing to stake their careers on wanting to see you succeed, and wanting to see themselves succeed by bringing in something new and transformative.

I focus on product and go-to-market. Tim focuses on operations in-house, as well as working with our customers. He's the industry expert, so he brings a lot to the product too. Max is our CTO, so he focuses on engineering and making sure we actually build the stuff we set out to.

We set up a decision matrix right at the beginning, deciding who owns what, and what each person decides on their own for each part. It's more like: can we get a majority? But usually we find we do have consensus on most big decisions, which is important. On other things, we let everyone run their part of the business, but we're all so interlinked and talk so often that it just works.

The advice I got: ask for the business as early as possible. When you're talking to prospects or customers, ask for the money as early as possible, because you'll quickly find out whether it's valuable enough for them to pay, or whether something's missing. A "no" isn't a bad thing, don't be afraid of the no. So, ask for the money.

Be passionate about the problem. Don't start a company and then look for a problem to solve. Live a problem, or be surrounded by something for a long time, and solve that. It brings a ton of credibility when you can say, "I've lived this, I've been in this space for a while." That can happen at different stages of life. Even if you're young, there are probably problems you've faced that you could say, "these are problems I can help solve."