Luka Babic’s startup, Orgnostic, was born in the pandemic and made in the tech market correction two years later. Here’s how he approached scaling from Dynamic Europe in volatile times and achieved a successful next chapter for the company.
“In times of great turmoil, there’s always a strong opportunity.”
So says Serbian entrepreneur Luka Babic, who should know a thing or two about navigating tough circumstances. As the people analytics startup he founded, Orgnostic, was gearing up to launch in 2020, Covid turned the world upside down. Two years later, the tech market correction wiped out its customer base, forcing a pivot to enterprise sales. Each time, Luka embraced an anti-fragile mindset — adapting his business so it could emerge stronger, eventually achieving a successful next phase for the company. Here’s how he did it.
Round one: The pandemic
Luka started Orgnostic to solve a problem he’d faced as head of people operations at Croatian unicorn Infobip where he overhauled HR into a data-driven function. “I wanted to have data and make decisions that were not based on assumptions,” says Luka, who was previously a psychology researcher at Harvard. SMBs and scaleups didn’t have any other options than building solutions in-house if they wanted to join up the disparate data points HR teams collect, from hiring data to employee engagement surveys, so he decided to build it himself.
In 2019, Luka met entrepreneur Igor Bogicevic at an entrepreneurs' event in Belgrade, paving the way for Orgnostic to be born. While Luka brought an intimate understanding of the problem that HR managers faced to the table, Igor had the deep engineering expertise needed to turn Luka’s concept into a fully realized product, given his background as technical co-founder of biotech big-data startup Seven Bridges. He is also a well-known figure in the local ecosystem with a deep network of technical talent.
They quit their jobs and started developing Orgnostic together, validating the concept in Excel before building the actual software. Then, the world shut down.
For Orgnostic, the advent of remote work presented an opportunity to supercharge growth. HR managers had newfound influence and increased budgets. The team doubled down on the shift, targeting B2B SaaS companies that were also thriving in the work-from-home era. Investor interest was also strong, and with remote pitching now the norm, Luka sought investors beyond Serbia. With little more than an MVP to its name, Orgnostic closed a $900,000 pre-seed round with international investors on the table in September 2020, followed by a $5m seed round led by Bek Ventures in 2021.
A reshuffling of the world’s priorities is bad for some sectors, but good for others. Figure out quickly how it affects your niche and leverage any changes to make your business as strong as possible, as quickly as possible. At Orgnostic, Babic identified that the pandemic had allowed him to gather customer data from customers who understood an iterative approach to product building.
Early customers and prospects like Box and Hotjar, familiar with the iterative nature of product development, provided valuable feedback that shaped Orgnostic’s MVP and pricing strategy. “We very much oriented ourselves into this space of growing startups that were scaling,” he says. “It played well… until we didn’t have that market anymore.”
Round two: The tech market correction
In 2022, “all hell broke loose”, says Luka. Rising interest rates and reduced venture capital shook Orgnostic’s customer base of tech firms, who were now cutting costs and slashing headcounts. Suddenly, HR software was a tricky sell.
Based on existing internal knowledge of the market, the team decided to pivot to enterprise sales, targeting companies with large employee bases and that were more insulated from wider market shocks. “We needed to do it super fast,” Luka says.
It’s natural for many SaaS companies to scale from serving small businesses to enterprises over the years, but Orgnostic needed to make its pivot happen in the space of a month or so.
Engineering talent with past experience in enterprise products drew up a list of things to do. The product’s security, customisation and scalability features were all overhauled, ensuring compliance with data security standards, better user permission controls, and more customization options for easier integration with enterprise systems. The platform was also strengthened to support larger user numbers — solving the problem of going from “500 users to 20,000”, as Luka puts it.
We often see teams miss the branding aspect of the pivot process, but Orgnostic nailed this step with a swift brand reposition. The company shifted away from its image as a “small tool for SMBs” to a more robust, enterprise-ready product. Social media marketing was swapped for conference networking, “which is where a lot of enterprise sales is being done” given that pandemic restrictions were now gradually lifting, says Luka. Orgnostic also created a new role — a people analytics evangelist — to promote best practices at industry events.
The transformation was huge, but it worked. The sales cycle was now longer, but Luka says Orgnostic kept its ARR in motion, raising prices to reflect larger clients and introducing an implementation fee that provided upfront revenue to support operations. “From a cash flow perspective, it was a much better structure actually than working with SMBs.”
This experience showed Orgnostic that the problem wasn’t with SMBs, it was with finding the customer segment where their value proposition truly resonated, an important step in the product-market-fit process that many startups find hard to get right.
Intense market disruption tests a company’s internal muscles as well as its overall commitment to the mission. A strong founding team and in-house talent familiar with other segments of the market made it possible for Orgnostic to execute a pivot quickly without compromising on either quality or the company’s wider goals.
Looking back, Luka says he might have targeted enterprise sales sooner, despite it being a difficult customer base for small startups to penetrate. “It’s easy to be a general after the battle,” he says. “With this knowledge, we would probably have gone for enterprises much earlier. But we would never know what we knew about data without starting with growing startups as customers.”
This approach to finding opportunities in turbulent times has proven successful. In March 2024, Orgnostic announced that it had been acquired by Culture Amp, an HR analytics company founded in Australia in 2010, achieving an outcome most founders dream of. “When I look around, most of the companies that started in our cohort, 2019 and 2020, in similar fields.. They’ve failed,” says Luka. “We managed to survive and thrive with that transformation.”