In this episode, Rob and Josef talk about some Twitter controversy over founder extravagances, and the difference between, say, personal chefs at work used for recruiting, vs. buying a used fishing boat with your profits. This is something we looked into in a piece Rob wrote on BuiltIn, “The Weird and Wonderful Things Midwest Founders Do After They’ve Had a Big Exit“
Jonathan Treble joins and talks about his path from Wharton grad to startup employee to Founder/CEO of PrintWithMe.
He also talks about building his company, and practical milestones he set. He also has valuable advice for founders:
“Optimize for control over valuation” – when negotiating at early stages.
“Validate with the smallest team that you can” – because, really, more money means more problems.
He also talks about team building, which is something Jonathan excels at. They use the “Culture Index” to guarantee culture fit, which is incredibly important. He talks mistakes, onboarding, and recommends two books that created his own foundation for recruiting:
“Who” by Geoff Smart and “Recruit Rockstars” by Jeff Hyman
Who does Jonathan see executing? Orazio Buzza of Fooda, Inc.
Welcome to the execution is king podcast. Today we have Jonathan treble founder and CEO of print with me, along with my co host, Rob Weber, managing partner at Great North ventures. Welcome to the podcast, Jonathan.
Thank you. Happy to be here. Thanks for having me.
So Jonathan, I know we first met a little over a couple years ago, I believe, and you were kind of busy starting to really scale your business print with me. Maybe for starters, could you maybe introduce us to how you got to that position, you know, whether it be where you went to school, maybe some of the influences you had from a career standpoint, which sort of led you to print with me?
Definitely. So I started my business journey in undergrad, my undergraduate program was at the Wharton School, I majored in finance. But generally, it was a very well rounded business program. And I went into business school because I knew that I wanted to get involved in business in some way. Even back in high school, I had started a couple companies in high school. And I had the entrepreneurial edge, I think that comes from my parents, and particularly my father got me started with an eBay trading assistant store in high school. And it was so much fun to build the business and see that have some modest success in high school. I went to Wharton, I studied four years of business Warden is very much a finance school and breeding grounds for wall street and specialty services, firms, consulting firms, etc. And so that flavor of education was a little too formal for me. I realized at the time, I was not really going to use a lot of the finance in my career, although it was great background knowledge. And at even at the same time, in college, I had a couple of side businesses going right after college, I joined a startup in New York City that was founded by somebody I had helped in an internship. And that was my first foray into startup land. I immediately loved it and understood why I am meant for startups, right. And that is just the pace, building something out of nothing. The ambiguity that I like working inside of, and I took that job in New York City, and they haven’t quickly moved to Chicago. And the the story there just kind of all worked out well, for me, I guess is that this New York company took a round of investment from light bank, which was the newly named venture organization founded by Eric lefkofsky. And Brad keywell, who are known to be among the best serial entrepreneurs in the whole country, certainly, probably the top and Chicago, because they’ve, they’ve taken public, at least four companies I can think of, and now we’re working on one or two unicorns that are still private. They’re just incredible entrepreneurs. And when I heard that they invested in in my friend startup and that I could join, and then they needed somebody to go to Chicago and liaise with them. I was like, Yeah, that’ll be me, for sure. So I read jumped at that opportunity, moved to Chicago for that, and ended up with that startup for about a year wasn’t really gaining traction, I switched over to another light bank, back startup, and then even another did some consulting. And after about three years, I wanted to try something a bit different. I wanted to get the big startup experience. And what I mean by that is like a larger at scale startup. So I applied for a job at grub hub, I was given the position, I joined as a project manager on the tech team, slash business analysts. So I was essentially in charge of the development work for five engineers. And these engineers were pretty senior, like much, much more accomplished and experienced and knowledgeable than the more junior engineers I was working with at startup land. And I got to really learn how software is delivered at scale grub up at the time was, I mean, calling a startup is definitely an accurate in 2013. It was way along in his journey and actually getting ready for an IPO already. But it still had the startup feel. And so I joined this, this tech organization, the tech org at the time was probably 50 to 100 people. And I was one project manager among many over a certain team. And that was great. His big company experience I guess, to learn how to work on a team within a big company and I was my job as the business analyst there was to liaise with other departments in the company and help build software to meet business needs. And so that actually gave me a lot of insight into other facets of grub up. So other departments, ranging from marketing, to finance to customer support operations, I got to be the person to kind of liaise with a lot of those departments and help them solve problems with software. So I think that that year that I spent doing that full time was among the more important learning opportunities in my then career, because I got to see what a startup would look like, at larger scale. And kind of what, as a founder, a future founder, I should be keeping in mind kind of like setting as a North Star for my own venture down the road. So at this time, I was about 2526, I was dabbling with a couple other business ideas, startup ideas, I even funded myself, I bootstrapped, that a couple people would help write code for me for a couple of these ideas, and we put them out there and we tried to get some traction, and neither of them really took off. It was there were interesting ideas, for sure. But they lacked some, some point of traction. And
I suppose during all that time at grubhub, you know, building products to meet business needs, you kind of built may have built up a backlog of these ideas to try out. It sounds like you tried out more than a couple of them.
Yeah, Funny enough, the ideas I was trying out, didn’t really come from grubhub, I did get a lot of exposure to different parts of grubhub. But the types of problems we’re solving at that scale, weren’t all that. Well, I’ll say some of them were innovative. But a lot of them were just scaling systems. Like, for example, I had, I had the good fortune of being the business analyst who is revamping our accounting system and, like re building out the business logic for like, what activities wound up in which ledger accounts which is mind numbing, but good experience for I think, just just to have that a little bit of that background. And don’t get me wrong, we worked on some innovative things as well. And I was actually I think I, I was involved in some patent application with one of the founders because we came up with a way to track delivery times better through through an interesting system. But you know, by and large, most of my job was was just the nuts and bolts of, of scaling systems, which in itself is interesting stuff. I liked it. It’s intellectually challenging, but it was not exposing me to like a very wide range of ideas. So these other ideas, were just things that I was inspired by in day to day life. And one was like a meetup app, like a spontaneous meetup app, because at the time there was not in this is 2013 meetup.com was very, like planned. And so the a few companies have tried this I I would later discover and that the issue with traction is, I mean, it’s, you know, how do you build a network effect, it’s so hard to acquire those initial users you need. You need like person liquidity, you need a lot of people to be wanting to meet up at once. So it’s, it’s really tough, and then monetizing it as a whole nother very challenging endeavor for that type of app. So this is all setting the stage for how I ended up at print with me, right? So around 2014 I think it was early in the year, I needed to print concert tickets for a concert, right downtown in Chicago. And it was kind of a last minute decision to go to this concert. So it was the weekend. I couldn’t print the tickets at work. I realized I needed to print them somewhere else. And I didn’t own a printer. And I remember having to get into at the time, I think was a cab because early days, I mean Uber Lyft. We’re not quite there yet. And I, I drove about a mile away to a FedEx Office, I printed those tickets, I drove back in the cab. And the whole thing probably cost like 25 bucks between the cab fare and then FedEx Office rates for printing. Just thought, Wow, what an expensive thing to do. Certainly I could have bought a printer at that point and realize I save money in the long run. But I was also moving apartments somewhat frequently. I was in my mid 20s I was embracing the sharing economy. I was thinking, you know, why do I want to own more stuff? And I bet I figured a lot of my peers and people in my cohort felt the same way. And so the idea kind of struck for printing kiosks and it was an interesting idea. It was a kind of like a wacky idea. like okay, who would actually put printers in public places right like It sounds like that’s maybe problematic, like, I could foresee many ways that that would break and how it’d be tough to manage. But the idea really kind of sat with me. And for a few months, I kind of pushed it off. And I was like, I don’t know if this is a great business, and I was working on the other ideas at the time. And then one day, in the middle of the summer, I kind of just had this this moment where I was like, You know what, that idea is still bugging me. And it actually I, I could use that myself. And I bet a lot of people could, and why not just try to build it. So I just decided to go for it, stop the other projects work on this as my key focus. And that’s how I ended up starting it.
Yeah, there’s a lot of good useful lessons and kind of your your origin, how you got print with me off the ground, I think a couple of the things that really resonate with me is just overall, I think, when people see successful founders, they often think that, you know, that they’re, they don’t think of all the background work that went into sort of honing your skills, and they’re just hearing your stories a lot like my own where it was like, I wouldn’t necessarily call them failures. But like, there were a lot of projects that I was gonna tinkering with, you know, before we had kind of our breakout success, which, you know, went on. And I think that’s a really common theme with a lot of entrepreneurs. And I’d say, the other ingredient there was to just working at seeing another company at scale that was, you know, previously a startup, be able to learn from the kind of execution, especially in like a product or product engineering type of team, we’re actually working on the product. And, you know, ideally, probably some exposure proximity to one of the founders, like I think, you know, that is that can be so powerful for people who want to know, they want to be a founder, but they don’t know how to get there. I have a lot of young people who reach out and say, hey, how do I do what you did? How do I become a founder, I think there’s, there’s these like two logical, and you should have both of them. I never had the sort of bigger company experience. But I think that’s like to be able to see the, you know, the startup at scale, alongside your own tinkering projects, that’s got to be super powerful, right?
Yeah, it was definitely powerful is the best education I could have ever wanted or gotten better than a definitely better than like an MBA or an advanced degree. And I actually think you’re right grub hub. That year was very important. It gave me the Northstar for how a scaled business or scaling business needs to look like and how the different departments interact, and how technology can support all that. Very important lessons that I still have with me this day. And a network of people that I still keep in touch with this day, and that have helped out and consulted with me, you know, subject matter experts. But I’d even say going back before grubhub. So there’s three years that I was in startup land, at early stage startups that were still trying to figure out product market fit, and building product. So I was, I started as like a sales rep in the first job for a year. And I switched to Product Manager at the next startup. And I did that for two years, about two years. And those experiences were almost just as valuable. In fact, arguably, maybe more. So I got to see these founders, these early founders, in their process of tinkering and trying to make a product that was in demand and viable. And that was just such an incredible learning experience. And I got to do it on somebody else’s watch or like, on their dime, in a way, right, they were paying my salary, I didn’t have that much risk in it. Certainly I was like earning under market because it was a startup, but I was learning a ton. And so that the combination of all those experiences was super helpful. So that when I went to start print with me, I already had a lay of the land of like, financing fundraising, what, you know, common pitfalls that some of those founders have fallen into with, whether that’s building their product, or dealing with fundraising, and investors, right? So it was four years of incredible learning, you know, from the startup land all the way through grub hub. And I would encourage anybody who wants to eventually become a founder, if you haven’t already to get some sort of experience as an employee at a smaller firm. Right? As as early as you can. I would encourage that. And, yeah, I’ve taken a lot of that with me even to this day.
Yeah, so it’s interesting, Jonathan, I remember if I think back to when we first met, one of the things that really stood out to me was just kind of your, your sort of more pragmatic view on raising capital. If we go a little bit deeper down that path. It certainly like immediately just like kind of clicked for me as a founder who bootstrapped a company you know, some some level of success and I think there’s just like Eat this echo chamber and venture capital and startup laying that it’s sort of like, you get on the train, and you just raise round after round. And it’s sort of like the tech media just celebrates, you know, these markups and these more dilution and more dilution. And I think it’s almost unhealthy in a way of, of, you know, the way the VC industry kind of like, almost like, perpetuates this sort of like myth about building a company. And I think I’ve really respected Can you talk a little bit more about your sort of mindset with how you funded the business, getting it going, and now scaling it?
Yeah, happy to I, I’m very passionate about this topic. As an early employee, pre IPO employee at grubhub, I was given some stock options. So I’ll start there. And that was, I think that was great that the founders still allowed early employees, I was like, employee 500, something. I was definitely not early, but they pre IPO, every employee still had a grant of options. And a year later, I was there on IPO day, I was still full time there. We all were in the money essentially. Right. And, and in a big way, I think the IPO popped. And incredibly the first day, certainly a lot of my peers who had been there many years were way, way better off than I was. But this was a modest, you know, a modest gain for me early in my career. And it is true what they say that when a when a tech darling in a community IPOs or exits and, and it’s a good exit, a meaningful one a big one, a lot, it creates a whole class of new founders, right. And they’re, I know, several who’ve gone on and founded new things after that, and, and so the liquidity was great. Again, I don’t want to overstate this, it was very modest. But for me, it was the working capital for bootstrapping print with me for the first six months, before I started raising some funds from friends, I’ll start with that, I think that’s important to reiterate, like being an early employee, getting those options can actually be life, life altering, I won’t say changing. And then I’d say my philosophy in the early days of Chrome with me, so like your, the first two years was to just raise enough funding to reach certain milestones, right, just enough to kind of keep validating that this is indeed a good business. Because when I first started with me, I went in with eyes very wide open, that this may not work out, this has a high likelihood of failing, actually, and I have no idea if consumers will actually pick up on this. So I said, I told myself, I was like, I’m gonna give this three months, if I don’t see any traction, after putting alpha test printers in a few public places, I’m just cutting the cord and moving on to my next idea, right, I was 26, I had nothing to lose, which is another critical part of being a founder, you really need to be be okay to like not earn any money, or it’s better if you have less to lose or lower lifestyle at that point. And I certainly had a pretty humble lifestyle at that point. And so I just figured it I bootstrapped for four or five months, just paying the developers on my pocket, I’m still working part time at grub hub, right? I luckily, they, they were able to reduce my hours to like 20 hours, which gave me enough money to pay my bills, and invest some of that money into into print with me. And there came a time where we had bought a bunch of printers, we wanted to increase our, our velocity for developers. So I wanted to hire a third developer contractor at the time. And I was like, no, what I should raise some money, I could really use some more more funding here. So I started going to friends first, and a good friend of mine from study abroad, wrote the first check in like December that year, so about five months in. And then another acquaintance from the light bank portfolio wrote another check after that, and another college friend wrote one of my former boss So in the first six months of fundraising, I just raised 50 grand from, you know, on a convertible note, and it was like such a shoddy convertible note that probably had tons of mistakes in it. But we ended up you know, converting that into equity with the first price round about a year and a half later, but that was it 50 grand to just fund more development and more printers. And again, bring me to a milestone where I would decide whether it was gaining enough traction to continue even further, you know, that end up being not very diluted at all, but enough capital how we could prove that. And then, at the same time, I was getting great mentorship from one person in particular comes to mind rasio bouza, who’s the founder and CEO of fouda Buta Inc. in Chicago, they do pop up restaurants in, typically office buildings. And they’ve grown an incredible business. And he’s a light bank veteran as helped two or three of the light band companies go public. And he was telling me early on throughout my early days tinkering with print with me, he was saying, you know, I wouldn’t raise that much money. I try to bootstrap as much as you can retain ownership. Right. And, you know, he didn’t think the print with me was a business that was really set up for venture rounds of funding, like ABCD, etc. And I think he was probably right. And I’m happy that I I raised in dribs and drabs slowly, because I still retain majority ownership today, and majority control. Importantly, and I could have easily gone away had I been enamored with the venture cycle of raising so many rounds, and you know, giving up more board seats losing control, right? That stuff is scary. I mean, you know, I’ll jump forward a little bit to when we did raise our first price round, it was August 2016, that we got the first term sheet. And, to his credit, Jeff meters, network ventures, was one of the only VCs in Chicago that would take a deep look at permits me bear with me scared off most other VC is what a printing company right? As it as I totally understand it would, right. And he got in the numbers, our traction saw, saw the growing revenue that each kiosk was making, like, wow, this is actually a good business, great margins. at scale, it can be a meaningful business, a decent size, exit, you know, medium to large. And he said, you know, I’ll do a term sheet. So we did that. And thankfully, right I, and I’m saying this to help maybe other founders that end up in this position. And, Robin, I know you’re a VC now, so I hope you hope you don’t, don’t mind me like giving some advice the other side of the table, but you’ve been on both sides. So I’m sure you don’t mind. Like I got great mentorship from two of these people that I looked up to when I was reviewing that term sheet. And both rasio and Mike Evans, a co founder of grub hub, when we were reviewing it together, they were like, you, you cannot give up a third board seat right now, right? Like the term sheet initially said, One investor board seat, my board seat, and then an independent third. And this was like a pre seed round. And they were like, No, no, no, you can’t do that. That’s crazy pants. So of course, I pushed back on that. And they, their advice was optimized for control over valuation. So I gave up the point on valuation, it was still a decent valuation for where we were at the time. And I but I was firm on retaining two out of three board seats. And to this day, I have so at I mean, I tell you, five years later, if I had if I hadn’t had that advice, or I’d gone the other way on that I would have many more sleepless nights because, you know, there’s there’s another group of people a board that could technically asked you, whenever, you know, they think that’s that’s the right call. And that can happen and does happen a lot of founders. So you know, I’m very happy for that for that advice. Now on raising capital in dribs and drabs, oh, I’ll continue, I raised that round, it was just 500k in new funding, all the previous notes converted in for equity, the post post money was like 3.1 on that. And then that was enough, again, to kind of validate that I could build an early sales team, we’d continue to get traction, some sales efficiency, get ready for maybe an A, well, we didn’t hit quite all those metrics. In the first year I struggled with hiring I made some poor hiring choices. And nevertheless, we were still growing, we actually tripled that year, but it wasn’t like what I wanted it to be, we’re able to go raise a seed two, which is definitely a thing now. And we’re it was an up around, I think,
an 8 million posts. And, and that, you know, was another I think, in fresh capital that was another like 900 at the time. And I was like, Alright, well, this might all be all we need to really get a sales team in place that can harm and, and prove the model and that ended up being true, I only needed that. It gave me another year and a half of burn, right? hiring and getting getting the team more efficient. And then we we reached profitability a couple years down the road and didn’t really need to raise again and You know, certainly it’s slower. It’s a slower path. It’s not for everybody. It’s not for every business, right? I, you know, the venture path makes sense for a lot of businesses, but not for my business, and certainly not at the time.
So when you’re talking about like raising, and like setting these milestones, you also talked about, like, kind of like a friends and family round going to people, you know, so were you matching up? Were you like setting the milestone first, figuring out what you needed, and then setting the amount? Or were you kind of gauging how much capital you can expect to raise, and then readjusting what milestones you can hit with that capital expectation?
Yeah, that’s a great question. I’m not even sure I can remember exactly what my thought process was. Go back now, five, four years, you know, I think, I think it was, well,
maybe just knowing what you know, now. Like, maybe if you can’t remember, like, instead of the chicken and egg quandary we could get into right now, if you had to devise somebody, what what would you tell them?
Yeah, I think I would advise to go the former route that you described, which is, pick your milestones like, what do you want to validate with, with your funding and figure out what you need? Yeah, figure out, like, what your use of funds will be? Like, do you really need 10 sales reps? Or can you validate with three? Right? All right, well, three is a lot cheaper than hiring 10 sales reps, right? Do you need five engineers or can you get by with to really try to i, in my opinion, validate with a small team as possible, because then you don’t have to raise as much at such a low valuation and dilute as much. But also, like, more money, more problems, right, you raise a $3 million pre seed, you’re going to have a ton of stress trying to hire up to to meet like, the expected burn on that in like six months, you’re, you’re gonna make hiring mistakes, these are gonna feel time pressure, you know, go slow in those early days. Unless, of course, you there are certainly exceptions where like, if you’re really on to something that can be a massive market opportunity, like 10s of billions and like, you know, someone who’s gonna copy right away, or somebody else is going to, or there already are competitors, you gotta go fast, right? And that’s, that’s where raising a lot of money and trying to blitzscale make sense where it’s a winner takes all are most market. And if you don’t act quickly, a competitor will, will take it right. I think that’s where, where you have to, but for a business like mine, where I didn’t see any competitors coming after us. And still, to this day, there really aren’t any, like, I didn’t have that time pressure.
It’s so interesting. And I just love I couldn’t agree more. It’s interesting. So on episode four, we had my new con from Twin Cities bass field nation, which is huge breakout success that the story isn’t very well known because we did this sort of friends and family round with my new Alcon he was sort of my brother’s computer science lab partner at St. Cloud state and central Minnesota. You know, he skipped all the subsequent funding rounds, no seed round, no way around, no, no, maybe not even a B round. And then he raised like 30 million after bootstrapping for seven years. And the weird thing about my news story, in his category, there were several direct competitors that raised far more money and ended up just flaming out. And actually one case, he acquired the company, it was just like, this is why we have the execution is king podcast, not be blitzscale and raise the most money you can podcast, because it very much it speaks exactly to the core of our beliefs, which is, you know, it really execution matters the most. And I think it even matters and even in cases where there are competitors, multiple competitors, even some with a lot more capital, you know, stronger execution with the right strategy will kind of Trump the capital all day long, right? I believe that it definitely is a little more nerve wracking as a founder, when you start, you know, having a more direct competitive pressure and in there, you know, maybe categories where there, there’s just a lot more capital flowing into it. But even then, like, I think my new is a great example. So I think that’s probably why like, this sort of mindset you had is very much aligned with my own, you know, in terms of just capital efficiency. And I think there’s also this being cognizant of the overall competitive landscape like you described, like that. It’s just so important. So I know, obviously, you know, if we fast forward to today, you know, growing the company is gone from like, will the idea work? You know, scaling and scaling, of course, means expanding the team. Can you talk a little bit about, you know, some of your lessons learned in terms of recruiting and building up your team and maybe we can dive into that for the last part of the podcast here?
Oh, absolutely. Yep. And I mentioned it earlier, but I made a bunch of hiring Mistakes after my first like large round of raising and which was 500k. And so it was it was actually the investor, the lead investor Jeff gave me a book on recruiting after that he was like, you should probably read this book. I was like, Okay, great. So I read it. And it was cool by Jeff smart. And that’s like one of the classic recruiting books out there. And about a year later, I picked up another book by Jeff Hyman called recruit Rockstar. So those two books have formed the backbone of our recruiting process, I’ve just taken their processes and kind of melded them together in a way that I think makes sense. And I hate
to interrupt yet, but I don’t want to get too far away from this. You dangle that out there. And I just got to ask without naming any names. What was your worst recruiting mistake?
Worst recruiting mistake? I think so hiring a couple of people at the same time who had fantastic like results on paper in sales roles, but were toxic for culture. So really, like just looking out for themselves to money motivated? Yeah, like all about themselves and not not willing to care about the team or the company. So that was so so I shortcutted the the interview process with those, those two people and it was disastrous for the culture, right, a couple other good people left because they were there and, you know, so that set me back a few months in the middle in the middle of this whole journey. But that was a lesson I you know, definitely learned and avoided that mistake after that. But yeah, that’s a it’s a great question. I made plenty of mistakes, I think I’ve made every recruiting mistake you could possibly make. But that one stands out as the worst in terms of impact on the company. And so I started getting building a process with these books. And and also like, you just build muscle for this right over time, you you get more confident in recruiting and interviewing and, you know, the imposter syndrome goes away a year into it maybe of recruiting and, and so I’ve learned a lot and even even from Jeff hymens podcast recruit rockstars, where he takes he brings on entrepreneurs, and they talk about recruiting, and lessons learned. I mean, I’ve learned so much from there, too. So now I feel like we have a really good process. But it’s so important. Nope, it was a lesson for me. Pretty pretty early on in the entrepreneur journey that I can’t do everything right, I, I find myself to be pretty bright, and like, adept at many different things. I like back in a year into starting print with me. I was like, I had my hands on everything, right? I was leading the tech development, I was leading the operational side I was selling I was like, marketing, I was doing everything. And I loved it, because I like doing a lot of different things. But at a certain point can’t can’t just scale like that. Right? And, and that, and I thought it would be kind of easy to hire people and just have them do the roles. But no, you know, you got to find great people for each role. And that was like, a learning opportunity for me, right? I think it was 28 when we started trying to hire people and at scale, and you know, and so that like learning how to identify strong talent for a role. Also make sure that the talent matches your culture that you’re trying to build for the company. Understanding like the difference between an entrepreneurial employee and somebody who works at a large company that needs so much structure and process around them and just gonna just flounder in your crazy mess of a startup, like, these are hard lessons learned. And I hope founders can avoid those mistakes by being very thoughtful about it and deliberate and listening to other founders who have gone through those same exact problems.
How do you how do you really like, ensure that they have the right personality? How do you how do you go through and like, I mean, it’s not like you give them like the Myers Briggs personality test are, you know, is it just a matter of the interview process and getting a lot of the right people on your team involved with talking to them?
Well, we do actually give a culture survey I’d call it which is a 10 minute questionnaire, and it’s called the culture index. And that is similar to Myers Briggs. It tells us at a high level, where an applicant falls on five or six different spectra of personality. So how driven they are right the competitive atop like seeking risk and autonomy, how socially our extroverted, introverted and in a way, how urgent they are versus more like methodical and Slow, and then how like detail oriented and conscientious they are, it’s been around for a while, it’s a derivative of like the five factor test, and like many people have written about it. And I use it religiously to this day. And so it is one data point among many in the interview process, and helps us get more comfortable with the idea of a person in a role and you figure out what archetypes and patterns you want for each role, and you try to make sure that your applicants match at least match majority of those spectra. So love that test that was introduced to me in 2018 by an investor who literally wrote a check for us to go get trained on it, like a five figure, check. He just wrote it. For me, it was like a gift. I was like, wow. But you know, that has been so game changing for the company that I’m sure he’s he’s, you know, it’s kind of like, he’s was protecting his investment, because he he probably also saw the hiring mistakes I was making. I was like, you gotta you got to go through this training, and use this test.
What What was the name of the test? I wrote down? culture index test. Is that the name of it?
Yeah, the culture index? Yep. Yeah, they’re, they’ve been around for, like 20 years. And there’s a great team at UT Dallas, I’m happy to put any founders that are interested in touch with with their leadership in Dallas. I’ll give my contact info after the show. But you know, it was transformative. I’m a junkie on that now. And it is, it’s really, it gives you a reference point that you you can’t even imagine for assessing candidates versus like the, the traits that you really need in a role. Now, that’s just one thing. You also have to test? Do they vibe with your culture? Like, if you’re trying to build a very Hustle, Hustle, Hustle culture? That’s like 70 hours, 80 hours a week? Well, are they willing to do that? Are they excited by that? Is that is that are they at a point in their career where they can do that, I was never trying to do that with all my employees. Since day one, I’ve expected just 40 hours a week, because we can get a lot done in 40 hours. And we we do I mean, I work I work a little bit more than that. But we’re, we’re still growing exponentially. You know it with a reasonable culture, they’re not not a crazy 7080 hour week culture. But you know, I realize some startups it’s, that’s, that’s what they want. And there’s good reason for it. In some cases.
I think that’s really interesting and kind of macro perspective, you know, our company’s scaled to 170 employees. And my brother Ryan, kind of, we were twin brothers, he ran kind of product engineering team and I, everything else kind of, for periods of time kind of rolled up to me. And so I think back to the way you evolved, your, your entrepreneur, your leadership style, sort of going out, studying the the areas, the best information available on certain processes, you knew you needed to scale your organization, and then bringing that into your business, on your own doing it on your own as an entrepreneur. And it goes something I remember, like in our sales organization, we got to several dozen people in our sales organization in my last company. And I think I read every, there’s all these different methods of selling, there’s like SPIN Selling solution, selling challenger sales, all these different methodologies. And I would just read up on all of them, I go, I think this would work best in our business. So we’re going to implement this. And then the next step was running a sales training workshop. And we’re creating case studies based on the book, you know, for this methodology that is completely built for our business. And it was like, and I thought it worked really well. There’s this sort of attention to detail on scaling, the organization, the onboarding that went into it. And, you know, even down to like an onboarding checklist for like, the first 30 days in an employee. There’s just I know, I was listening to your podcast interview on recruit rockstars. And you talked about, you know, the importance of strong onboarding, I think that’s something many startups, you know, really fail at, quite frankly, though, especially in the positions where, you know, you’re going to add a lot of staff. You know, it’s so critical. The early experience and employee has made me talk a little bit about like, you know, beyond recruiting like the onboarding experience, and some of the things you’ve learned as you guys have been building up the business.
Yeah, sure. So you, you hit the nail on the head. onboarding is very important. We’ve, I learned the hard way I had a couple people that I just kind of threw to the wolves and just said, Hey, can you go figure this stuff out, and that they didn’t last long, and that was my fault, right? But I learned some wisdom from Jeff in his book to take onboarding very seriously. So I started there a couple years back, I built an onboarding checklist of things that I think every employee approved with me should know. And you know, it’s it’s the nuts and bolts of like, systems, getting getting all your tech stuff on boarded obviously that’s going to be There, but also like, how we communicate what are our communication guidelines and standards? And what are our okrs? What does our OKR system look like we do objectives, key results, like the measure what matters, but we have every employee read the measure what matters book. So that’s part of the onboarding checklist. So we we try to be just as good about onboarding people into our culture as we do the nuts and bolts of the systems in the company and also like the knowledge for their specific domain or the role. Both of those things are very important. I we now have the good fortune of having two people in HR lead recruiter and then kind of an HR recruiter hybrid. And now that HR hybrid is onboarding people, and has a checklist and you know, he’s there, buddy, for for onboarding. But early on, it was all me, right? When you’re a 10 person company, you’re the founder, you’re doing everything. But like you said, Rob, I, I would read tons of books, I still, there’s there’s a bookshelf at our office in Chicago, where I dumped all my books before I moved to Denver last year, and it’s like, filled, it was probably 100 books on startups selling marketing, tech development. I mean, you name it, I think that’s another key point for aspiring founders is you have to be a voracious learner. You have to be humble enough to realize you, you don’t know everything yet. Which I, I’m not sure I was quite there at 26, I kind of learned the hard way. I need to level up a lot of skills in my late 20s. But you know, you really can if you’re open to learning and curious and you’re seeking it, you can find so much wisdom in any topic by just reading a book, and then bringing it to your business and saying, alright, this sounds great for my business. The next day, you incorporate it into your process, and you’re able to do that as a founder, right? Like there isn’t red tape, which is great. Your your employees might have whiplash if you’re doing that too much. So you can’t be a book of the week person but you got to, I think there’s a balance you can you could do it reasonably in a way that is beneficial for the org.
One of the other managing partners are great and adventures is Rob’s twin brother Ryan, co hosts other episodes. He is fantastic at producing book recommendations for me, I don’t know how many of his I have behind me on the shelf, but several and the last time I we were in person, I saw Rob and Rob recommended a book to me that I’m actually already currently reading a Clayton Christensen book. It was just fantastic. We are running out of time here though. I want to make sure we get in our last question. I like to ask every one of the guests on our podcast, this question focused, we’re focused on execution. And we like recognizing people who can do that it might not always be the flashiest people who are getting that recognition. So is there somebody, maybe it’s a team or a startup or a single person that’s really executing that maybe they’re flying under the radar, maybe they’re not maybe they’re deservedly, very popular, but someone that you’ve seen or startup that we should be paying attention to.
I’ll say I’m again, I always and I will always say this orazio bouza is probably the best operator I’ve ever met. And I’ve met a lot. And you know, just to give you a sense, so he he’s skilled three or four light band companies and food is is now an awesome success in Chicago. But I think he told me once and he wasn’t trying to brag, but he was just kind of explaining, like how he does budgeting. And he, he had set lot, you know, pretty ambitious projections for fouda in the early days when their fundraising and you know, some investors were passing on on a couple of his rounds, they just didn’t think it was for them. It wasn’t software enough. But then he would go back to them a year later. And he would show them the new projections. And they would see that he actually hit the ambitious projections. And they were like, no one ever does that. No one ever hits their startup rejections, but he actually does and I’ve learned a ton from him. He he, he’s probably the best. I mean, I can’t think of another so he is the best executer that I’ve ever met. So I’m happy to make an intro to try to help you guys get him on the podcast at some point.
Yeah, that’d be cool. Sounds great. Well, thanks a lot, Jonathan for joining us today. It’s been a pleasure.
pleasures all mine. I’ve really enjoyed the conversation. And yeah, good luck. Continuing with the podcast is a great idea.
Ryan and Josef talk about the importance of startup communities and the importance of innovation in rural communities, including St. Cloud, MN.
Molly shares her experience working with incubators, builders, and startups with Singularity University and how that led to her position as the Entrepreneur Ecosystem Development Lead at CORI, where she works with communities to build the infrastructure necessary to help entrepreneurs succeed. Molly paints a picture of a rural America in decline, and explains the transformative value generated by tech startups and productive tech startup ecosystems.
She explains that the key to any ecosystem is putting the entrepreneur at the center, and calls out Red Wing as a startup community that is really executing- as well as every rural community they work with. “That’s the stories that need to be told. Those are the underdogs that we need to be uplifting. Those are the people flying under the radar that I could talk about all day.” “We have so much more to go as a country in terms of entrepreneurship, in terms of innovation than just what we see in these five major metro areas.”
Full Transcript Below:
Welcome to the execution is king podcast. Today I’m talking with Ryan Weber, managing partner of Great North ventures. And joining us as a guest is Molly Pyle, the entrepreneurial ecosystem development lead at the center on rural innovation. I’m Molly, how you doing today? Hey, doing well, how are you? Good, good.
Hey everyone, Ryan Weber here in greater St. Cloud, Minnesota for my home. It’s late June 2021. And we’re starting to see things open up quickly as our vaccination rate Minnesota exceeds 50%. I moved to the St. Cloud from the Twin Cities in 1998 to attend college. The population here is around 189,000. While in college, my partner at Great North ventures Rob and I bootstrapped a company and online PC software publishing and later, ad tech focused on smartphone app marketing to 170 employees and eventual and exit. You know, at Great North ventures, we think execution is key to success. And this podcast will hope to help founders and investors learn best practices from others building the next great global startups from wherever they may be. And I’m really excited today through the work at Great North ventures I’ve had the great fortune of interacting with Corey and some of the work they’ve been doing with ecosystems in the region. So Molly, could you start off by telling us a little bit more about your background and what Korea is?
Yeah, definitely. So I got started working in entrepreneurship, working with startups, running incubators and accelerator programs at a company called Singularity University based in Silicon Valley. And I had this amazing privilege to get to work with global entrepreneurs see incredible ideas and innovators from truly everywhere, every corner of the earth, you can imagine folks would come and participate in this program that helped them, leverage these exponential technologies and build them into scalable tech startups. So that made me really fall in love with the opportunity that entrepreneurship provides for people. No matter where you come from, if you have a good idea, you can turn it into something real and impact billions of people potentially. So with that sort of becoming my professional focus, I learned about the center on real innovation, which is just a really compelling organization for me specifically, as I wanted to see entrepreneurship as an opportunity become more accessible to more people. So the center on real innovation is an organization that’s really dedicated to closing the rural opportunity gap that emerged out of the Great Recession. I joined the organization in August, like Joseph mentioned as the entrepreneur ecosystem development lead. And that’s really just a long way of saying I help rural community leaders build startup communities and entrepreneur ecosystems. And what that means is building that infrastructure that’s necessary to help entrepreneurs thrive to help aspiring entrepreneurs who have an idea, but maybe don’t know that they can take it forward and execute it. Figure out who are the people who are the programs? Where are the partnerships, what can I access that can help me actually create this tech startup, even if I am in Red Wing, Minnesota, or Cape Girardeau, Missouri, for example. So these uncommon places that you don’t often hear about, as you know, innovation and tech hubs, but center on real innovation really believes that they can become these kinds of tech hubs. And part of that why is why are we focused on rural America specifically, it’s because to be frank, it never recovered from the 2008 recession. So the urban and suburban communities really bounced back rural places failed to replace the jobs lost in that recession, let alone grow their economies. And then we all know the effects of COVID. Nationally, globally, no matter where you are, who you are, we all felt the impacts, but in rural, specifically, only 5% of tech jobs even before COVID were in rural areas, despite the same regions representing 15% of our national workforce. So all of this very unequal recovery stems from what we’re seeing the automation of jobs, so many of which were originally in rural like agriculture, manufacturing, globalization, so outsourcing some jobs that could ultimately be done by Americans if they were skilled up to be able to meet the needs that those jobs require in terms of skills and talent, and this 30 year decline that we’ve been seeing in entrepreneurship. So that’s why we’re really committed to creating sort of inclusive ownership of production in the age of automation.
That’s great just for framing today’s conversation a little bit Can you talk about for corys focus? Can you define what you mean by entrepreneur and what you mean by rural?
Yeah, totally. So rural, we talk about like a community in the population size of 5000 to 50,000, which may seem even bigger than you might think but something that we think is important is trying to Create, whether it’s through regional partnerships or through technology as well, the density that rural communities in rural areas lack, that you just naturally have population density in an urban area. So we think about rural in this way, we try to encourage the communities that we work with to take more of a regional approach and think about how they can leverage technology to build more of an ecosystem and inclusive culture. And entrepreneurs, you know, anyone with an idea who is actively working on turning that idea into a startup, and we specifically focus on folks interested in building scalable tech startups. And we do that because there are lots of organizations incredible organizations like score and co starters and the SBDC and local communities that will help folks with a main street or small business or sometimes called a mom and pop kind of business idea. And we acknowledge that that kind of entrepreneurship is critical and is a backbone to really the American economy. But what we want to see is scalable technology startups being created in rural communities, because we’ve seen the returns that those kinds of companies can have in terms of jobs, in terms of wealth being created for that community. So seeing those kinds of impacts, helping people create tech startups, also the rise of distributed work and remote teams being something that you can do, you know, build and scale a startup in rural Maine. And you could have some team members in other hubs where there’s more tech talent, perhaps, but doing that, helping bring the jobs helping bring the wealth and create that in a rural community. That’s our goal. That’s what we’re really focused on.
Right? Can you share a little bit more about what community needs to be successful? Is there a checklist of must haves that you have put together?
Yeah, so I mean, the first kind of obvious thing, which I am proud of and want to share about the center on real innovation is one of the things we do as well is help communities to apply for federal funding. So the basic funding that you need to stand up and build an incubator, for example, or get the funding to run an accelerator program or a hackathon, all of that has to start somewhere. And we support real communities and applying to this federal funding. And I’m very proud to say since 2019, only, we’ve helped communities raise more than 13 million in federal funding and match dollars. So the first kind of thing I would say is, while there’s no checklist, it’s it’s pretty obvious that you need, you need capital, you need an infusion of capital, you need folks willing to invest in the community to build the basic infrastructure for an entrepreneur ecosystem. And you know, there is no replicable formula that you can take and drag and drop. We’ve seen some things work in some communities and not working others, but ultimately to one of the most basic things in addition to just having some infusion of capital, whether it’s federal funding, or investors or a mix of that public private partnerships, is also just access to connectivity to high speed internet. So just to illustrate, and part of what Cori does, as well, another bridge organization is support communities and accessing broadband and getting broadband set up. So for example, a recent Deloitte analysis of the digital divides economic impact showed that a 10% increase in broadband access in 2014 would have produced nearly 900,000 more us jobs, and 168 billion more in economic output in 2019. So that’s, that’s kind of, I think, a really powerful statistic to show how important broadband is to economic development and particularly, to building entrepreneurship ecosystems in tech startups. If you’re again, trying to hire remote, you know, DevOps team, and you’re in whatever rural community you may be in, that’s where you love. That’s where you want to be rooted and build your business. If you’re having trouble connecting to the internet and chatting with your team on zoom, which, as we’ve seen, is such a lifeline to doing work in the 21st century, you know, the chances of your success are really limited. So starting with broadband at the most basic level, starting with capital to help you actually build out some of the physical and, you know, otherwise infrastructure that you need for programming. That’s super, super important. And then I also think it’s really, really vital for tech entrepreneurs, especially in rural areas to see visible success stories of people who look like them, who come from their community, who have made it who have been there done that, even if they failed once or twice, I would say that’s even better. Because there is this mindset of, you know, this can’t happen here. There’s this fear of well, if I try and I fail, then everybody knows me, I’ll I’ll have to run into people at the grocery store and kind of hide my head and shame. And I think that we need to really blow up that idea and celebrate the failures, which is something I think I jokingly say Silicon Valley maybe has over indexed in doing but in rural communities, we can kind of bring it back down to It’s okay. You have the courage to actually go out there and try something. And we should be celebrating you and highlighting your efforts to try to build something amazing in this community and for us and for us to be proud of. So get back out there, try again, amplify the voices of people doing this, put them on platforms, do speaker events, do tech talks, do things that the community can come in open to the public and engage because these types of things, I think, plant that seed, and shift the narrative that oh, this can’t happen here. So that’s really important. And also that leads to more that leads to you know, I go to a tech talk, I hear from an entrepreneur, who has actually made it in my rural community. And that suddenly inspires me, I can do this. Now, what do I do? What’s the next step? So having a sort of clear pathway of you go to a tech talk, you hear someone who’s made it who’s from your neighborhood? And then you think maybe this is for me? Well, where do I get started? Who can help me? Are there programs are there incubators are their mentors are their angel investors. So building all of those basic next steps for an entrepreneur to have a sort of cohesive journey, I find that that’s really, really critical. And that’s something I work a lot with our rural community leaders on developing that journey for their entrepreneurs.
So where do you see communities like starting out? Do you have like leaders come to you who are working on building that infrastructure? Or do you see it beginning with entrepreneurs trying to do a tech startup and then reaching out when they when they have, you know, things that they need that they’re not able to come up with?
Yeah, our model is working with the community leaders. So the people at that ecosystem building layer, maybe their managers or directors of incubators, co working spaces, accelerators, or general, you know, entrepreneur innovation hubs, maybe attached to a university, we work with that layer of folks to ultimately build their capacity and their ability to serve their local entrepreneurs. So trying to keep things really deeply rooted in the community because someone who has been managing the CO working space in you know, platteville, Wisconsin for five years knows much more than I do about who you should talk to and where the mentors are, or what investment may have happened two years ago with this other successful startup. So we try to help those community leaders actually be the most effective that they can for the entrepreneurs. However, I will say I, I’m a big fan, probably no surprise to anybody in the startup world and Brad Feld and Ian Hathaway in the book, startup communities, I’ve been reading that and doing a book club, actually, with the real community leaders on it. And there’s a piece in that which I love. And I always try to drive back home, which is this philosophy of keeping entrepreneurs at the center, everything in the startup community in the ecosystem should revolve around entrepreneurs at the center, what do they need? What are they looking for? How can we best be of service to them? So trying to apply that lens to the work we do with the community leaders is really front and center of ultimately, everything I’m doing is saying, Are you talking to entrepreneurs just like how we tell entrepreneurs? Are you talking to customers? Are you getting out there in the field? Are you asking questions? Are you iterating, based on what they’re telling you, the ecosystem builders and the people serving entrepreneurs need to also have an entrepreneurial mindset. They need to be flexible and adaptable, they need to respond to the changes of what the entrepreneurs are saying they’re needing or what’s working or what’s not working for them. So trying to really help them adopt that mindset and be the best possible, you know, supporters and fans and amplifiers of their local tech entrepreneurs. That’s really, again, what I think we are all about, ultimately, are the work that I do.
I got a shout out our advisor Scott Resnick, at this point. He’s he wrote a portion of a chapter or maybe it was a whole chapter I forget in the startup community, his book. He’s EIR at starting block in Madison, Wisconsin doing all kinds of good ecosystem work in Madison.
That’s really interesting, Molly, you know, I was thinking back to when we were starting there. You know, it’s obviously a larger market, but we had entrepreneur success stories. And that was a major inspiration. And I think more recently, I’ve heard about tech successes and other smaller markets, like Ben from Douala into Moines. He’s got very become very active in the ecosystem in Iowa. And Zach, founder a jam that went public in Eau Claire has done so much to help, you know, you know, ignite, you know, a spark there in Eau Claire. And, and I think that’s something people don’t realize is that there are six very successful tech startups that are being formed, you know, all around the country in the world right now. But these markets are a little bit bigger than the markets you’re targeting. I’m really curious to hear are there any markets or startups kind of entrepreneurial success stories that you could share from these smaller rural markets that you’ve engaged in started working with?
Yeah, so I, I mentioned this community earlier, and I love talking about that. Because they are a, you know, real underdog that’s come up and hence a massive success, and that is Cape Girardeau, Missouri, and this is a community 40,000 in population 25%, poverty rate 25%, lower median income household in the population. So it’s a region and an area that had been in decline in all the ways you can think of and university attendance in their some of their main industries being manufacturing. So the two entrepreneurs locally, who decided to do something about this, James and Chris, they opened, codify, which is a co working space, an innovation hub and tech incubator in Cape Girardeau, which is in Southeast Missouri. And they started this competition called the first 50k, which is ultimately aimed at attracting tech startups to the area and ultimately giving them $50,000. If they agreed to stay in that area for two years and build their company there. And they provide lots of value mentorship, they actually have a in house project shop, and an adult coding boot camp where they’re building the tech talent pipeline as well. And that’s another big thing in terms of what do entrepreneurs particularly in rural need is access to tech talent, right? So beyond hiring remotely, if you can find local tech talent within your community, that’s fantastic. And so keep Gerardo the codify folks were really trying to solve for that building out the tech talent building out the program to bring entrepreneurs, and they had some really interesting learnings in that program, and found that there were some folks who, you know, came participated, got the $50,000 for two years and then left. And that’s obviously not what they want, they want to find people who are going to stay and become rooted in the community and really, you know, give back and stay there for as long as their startup is scaling and growing and in business. And what they found is that that was actually a real goal of one of their entrepreneurs show rust of a company called show.ai, which is a sort of AI and digital marketing firm, which is just rapidly now scaling, super successful. And part of it is because show, he was doing the startup thing in LA, he was, you know, scaling and getting a lot of traction and saw the first 50k competition as an invitation to return home. He had had family he had had, you know, community and connections in Cape Girardeau, and thought that that was always maybe a place that he would like to return to and be closer to his community. But he didn’t think that there was anything there in terms of, you know, startup activity, mentors, investors, people who could support him. So he was living in LA trying to build that out. However, he saw this first 50k competition, he realized, while people or people in my hometown are trying to make it happen, actually, there’s there’s activity, there’s vision. So he applied, he won, and he has been there ever since. And he’s actually a company that our firm, the Corey Innovation Fund, actually a branch of our organization has invested in so we have a fund that invested in qualified opportunity zone startups startups based in those opportunity zones, which Cape Girardeau is. So show being back in that opportunity zone, being back in his hometown with his family, building his tech startup that was you know, doing great in Los Angeles, but now continues to thrive in Cape Girardeau. I just love that story. And I think it’s a great example of finding, finding that personal connections, people who are gonna return to a place or move to a place or stay in a place because there’s something you know, that really roots them there. I think that is really special and really notable. And I just have to add that part of the first 50k program, why I love it, and think it’s impactful is if you can find those people who are going to stay, of course, beyond the two years, that’s the goal, who have this reason or vision for saying in the community. What that has happened is seeing the awardees, seeing those startups generate over 6 million in revenue, create 40 plus local jobs, and generally, again, prove to the community be visible that this is possible that this can happen here. So ultimately, I think that that is one success story. But the program itself is so much more impactful. I think when you look at that big zoomed out view of how many jobs and how much impact and how much of a mindset shift it’s creating for folks in Cape Girardeau.
Yeah, that’s really interesting. You know, I, I hadn’t heard details of that story, but I can only imagine how transformative that is to a community like that. And, you know, there’s, you know, you know, a couple of people I wanted to get kind of shout out and in our region, you know, in Sioux Falls Matt Polson, of marketbeat, a founder has really taken a leadership role along with local other entrepreneurs and consulting groups to really shape Sioux Falls, South Dakota, and it’s really a it’s become a statewide initiative. It’s really connecting communities around the state to supercharge startup entrepreneurship and In North Dakota, you know Greg Tevin and advisor in our fund, with emerging prairie in the grand farms initiative, they’ve got a plug and play now in partnership with Microsoft building the future farm itself, you know, these are larger markets, but you would, it would just blow your mind how connected these communities are and how these entrepreneur and ecosystem leaders together can really make a difference quickly and in and that’s what, you know, in your story. It resonates that speed at which, you know, a small group of people in a smaller market, when aligned can really, really change the trajectory of a community quickly. And that’s one of the real, you know, positives, there’s obviously no, there’s some of the challenges that we discussed earlier. You know, speaking of challenges, what are some of the lessons learned, you know, what are unrealistic expectations? What are some of the past failures that we might learn from, from some of the work you’ve seen?
It’s really important, like, I like I had mentioned that tenant of keeping startups and keeping entrepreneurs at the center of everything. So anytime that there is a story of a pitfall or a failure, I tried to think about, well, what were the symptoms or the factors that caused this and almost every time, I would say, if not every single time, it’s when governments or other actors, stakeholders, people kind of outside of the direct sort of center of entrepreneurship are trying to exert control, trying to impose their views from the top down, rather than letting the entrepreneurship ecosystem be really bottom up, be led by entrepreneurs. So architecting out, entrepreneurs from leadership is the most, I would say accelerated way you can lead an ecosystem to fail, if the entrepreneurs are not the people at the center, making decisions, having their voices heard, having their needs being met. I think that that is something that, you know, will be a fast track to pitfalls. And, and I think that all too often, too, there is this expectation of these kind of actors or investors at the maybe government or other level who believe that there is such a thing is an overnight success story. And while there are there are definitely people who can move fast and break things, as they say, all over this country, and particularly in rural areas as well, because I really believe that innovation and being resourceful is kind of at the heart of a lot of people in rurals mindsets and attitudes, you had to be innovative and resourceful to survive in rural America really, for so long. And so I think that when you can see, you know, folks not understanding that this is also a long term commitment. This is a long game, like, you know, Brad Feld says think of it in 20 year segments. So when folks are expecting overnight success and have a misalignment of expectations of Oh, we want to see your first accelerator ever that you’ve done in, you know, rural Vermont produce the next Google, that’s obviously not realistic. However, it doesn’t mean that there can’t be fantastic startups coming out of these areas. And these programs, it just means that we need to in tech startups, for that matter, it’s it’s definitely our focus, like I mentioned, but it’s something that I think we need to get on the same page about early on is that this is going to take, if you’re starting from scratch, especially a longer time, you’re going to need to really stick with it to be okay, like I mentioned with the failures that you might see at first, and to understand that this is something that will happen over the course of like Cape Girardeau, that kind of massive impact and all of the, you know, millions that they’ve generated, and the hundreds of jobs that have been created beyond that first 50k program, they also have, you know, tech startups being built just within their space, all of that happened over the span of now seven, seven years or so. So it’s it’s not something that can happen within six weeks. But it’s also you know, something that I think we can stay optimistic about because it can happen, it just may look a little different than you might imagine it would in Silicon Valley. And that’s okay. I don’t think we need to recreate the next Silicon Valley, I think rural communities can create their own thriving startup ecosystems that fit with the culture in the context. So ultimately, I think it’s about keeping that in mind.
That’s really interesting. You mentioned a few of the success metrics, like job creation, and you talked about, you know, upskilling, you know, the labor, you know, workforce, but also, you know, attracting, you know, you know, skilled talent back to a region. You know, are there any other metrics that are qualitative or quantitative things that you use as measures of success? Because, you know, this is a can be a grind, and you have to, it may take a long term, but what are some of the things that you would any other anything else you might suggest focusing on, you know, for measuring the progress that’s being made?
Yeah, I mean, we definitely do look at access to capital as a indicator like like every startup ecosystem, but particularly how die The situation is in rural, that we’ve found and research shows that less than 1% of all VC money goes to rural areas 80% of all investments are made in just five major Metro cities. So tracking and looking at and supporting, how are how the companies in these rural communities are raising capital, whether it’s through traditional investment, capital micro financing grants, we’re trying to support them in all the different ways in blends that they can access capitals. So helping them do that. And tracking that is a huge metric. It’s also you know, the the, the equity investments that they can get from that wanting to see that it’s the exits we’ve had and seen a few exits a few IPOs, a few acquisitions. So trying to track all of that, but also, you know, just the the general startups if you’re starting really small, that are participating in your incubator. are you growing that number over time? Did you start off with five companies in your incubator or accelerator and then three years later, you’ve got 25, we would count that as massive progress because it means that you’re building traction at that community level. So funds raised jobs created profit generated by the new startups, those are, I think, really great and traditional metrics to look at. But helping match metrics with the early stage ecosystem development is important, too, right? You’re not going to have maybe 7 million raised in capital out of the companies in the first incubator ever, or maybe one company does that. And that’s great. But ultimately, you may not see that happen right away. But to match that metric with wherever you’re starting out, if you’re just trying to get folks to pivot, a small business idea, let’s say into a scalable tech startup in a week long, you know, startup bootcamp that’s going to have different and should have more than grounded metrics, then what you want in your accelerator program, after you’ve been doing this community building for three years, let’s say,
could you talk about, you know, kind of changing gears a little bit here? Where can someone find resources as a community leader or entrepreneur for supporting rural startups? You mentioned a book earlier startup communities? What other resources at quarry or or, or more broadly, Do you often recommend?
Yeah, I mean, like I mentioned, doing that book on Brad Feld, I mean, Hathaway book is, is, I think, a great tool for learning and for rural ecosystem builders to really get that perspective. I also, you know, selfishly would say what we’re doing at Korea is really partnering with folks to help navigate How can they build this startup community? What do they need to do? Who are the partners, where’s the funding? So we do a lot of that I also point people to the resources from the Kauffman Foundation, I think they are doing some really innovative work and are supporting entrepreneurs in you know, the heartland in rural areas where I think it’s really needed most. So I also think that as much as I mentioned before, you’ve got to get the actors and then governments and the stakeholders to really understand and put the needs of the entrepreneurs, front and center. And assuming you can do that, I think that governments actually a great source of support for entrepreneurs and for ecosystem builders. So if you know how to navigate those complexities of federal funding, SBR process can be great for non dilutive funding, though it can be challenging. There’s also a lot of programs through the Economic Development Administration, we support communities to apply for the build to scale program, which helps you really get that first infusion of capital to build out a scalable tech startup ecosystem. There’s also the USDA rise grant, which was just announced, which provides funding for tech innovation, entrepreneurship, even building physical infrastructure, building the incubator space that you may need. So I suggest you know, folks stay in touch and tuned into what federal funding opportunities are coming down the pike that Kauffman Foundation that Cory I mean, I would say the content that Joel are producing to at Great North ventures could be fantastic for people in your region. So I think it’s important, yeah, to take the national level, understand what’s happening at sort of that layer of the entrepreneurial vision and possibility in this country. But also what’s happening at your community level are they’re great people producing events and content and trying to make connections. And they would love to have more people at those events and reading their blogs and showing up and so finding whatever is in your area, but also tuning into some of those natural national resources. I also just really appreciate the work, though it may not be a resource they bring a lot of, I think thought leadership to this work is village capital and rise in the rest. So those are two that I kind of like to look to as well for what are they thinking what are they saying what are the frameworks they’re putting out? And, you know, how does that look and compare to the work that we’re trying to do in building these ecosystems in rural Specifically,
thanks so much for coming on the podcast, Molly, I usually close out with the same question every time. And that’s to ask you who is someone, or a team or a startup, or in your case, it might be an organization, but someone who’s flying under the radar, maybe people haven’t really heard about them. But that’s really executing, that people should be paying attention to.
I, it’s funny, I would take a wide approach to this question and say that every rural community that we work with is in many ways flying under the radar, right and should be looked at as a really, you know, interesting place and a inviting place to invest. And to just understand more and more about what startups are there that tech startups are actually viable and are happening and are being created in these rural communities. And I definitely think I would be remiss not to mention Red Wing, Red Wing, Minnesota being a place that we work and partner with that community. And though it’s not exactly under the radar, because one of their startups was on Shark Tank, actually. And I was just, you know, learning a little bit more about her story, and was really proud of just the way that she has built this company with her brother from the ground up and ultimately got an offer from the sharks and turned it down and is just crushing it otherwise with profit. So I love to see those kinds of things. It’s not under the radar. But I think there’s lots of other entrepreneurs in Red Wing and being served by Red Wing ignite, the one entrepreneur first collaborative that they have there, which I think is just really cool. It’s another model, like we talked about building density, that’s a great model, because they have regional collaboration, they’ve got 11 different counties within southeastern Minnesota, all working together to try to build up that, you know, pipeline of rural tech startups and amplifying those entrepreneurs. So another one I think is really cool. You guys may know is doc labs, this robot that will help people be better at basketball, I just love I mean, those kinds of stories of people having problems that really personally affected them, but then figuring out well, how can we how can we solve this because that’s a real pain point for you know, actual people in this world and solving that and going after that, I think is just, that’s the heart of what entrepreneurial ism is. It’s identifying what needs to exist in the world that doesn’t, and how can I go out there and build it? So seeing that happen in places like Red Wing in places like Wilson, North Carolina and Durango, Colorado, I mean, to me, it’s, it’s that’s the stories that need to be told those are the underdogs that we need to be uplifting. Those are the people flying under the radar that I could talk about all day, because I just think it’s really exciting that we have so much more as this as a country to give in terms of entrepreneurship in terms of innovation than just what we see in these five major metro areas.
What a great summation to that’s what it’s all about identifying problems people have and fixing them for him. That’s fantastic. Again, thanks so much for joining us on the podcast today. We’ll catch up with you later. Yeah, thanks me. So fun.