Mike Hagan is a founder, operator and wildly successful investor in a variety of companies. He has repeatedly proven his ability to create or invest in a company, scale it and successfully exit. His venture was the B2B procurement WebHost VerticalNet, which hit a market capital peak of $11 billion. Unfortunately, Vertical Net ended in flames like many other dot.com companies at the turn of the millennium. Following that experience, Mike used his personal profits and lessons learned along the way to buy and build NutriSystem, with an eventual big exit to diet nutrition conglomerate Trivity for $1.4 billion. Mike's next venture was a similar controlling interest investment in the DIY home security company LifeShield which he and his team scaled rapidly, sold, eventually bought back, and sold again for a substantial profit. In 2014, Michael launched HawkCapital, his current passion project. A founder, operator and investor, Michael is a man who has taken on multiple roles and worn many hats. Tune in to find out what he has learned from his experiences.

Key Takeaways:

[1:18] Kevin introduces his guest for this episode — Mike Hagan.

[3:00] Kevin asks Mike five speed questions.

[5:37] What was WaterOnline and how did it start? Mike shares the story of how he got started with what eventually became VerticalNet.

[8:38] Mike shares more about how the expansion of the internet led to establishing multiple VerticalNet communities.

[15:25] How difficult was it to navigate the early stages of VerticalNet in an uncertain environment?

[18:17] What was the business model like for VerticalNet?

[20:16] VerticalNet eventually went public. Mikes shares more about that experience.

[25:08] Beyond just the advertising component, what were some other pockets of revenue that Mike was able to grab?

[28:29] VerticalNet's stock took a sudden plunge in 2000.

[28:59] Mike talks about some of his experiences with the leaders of Microsoft.

[30:06] What were some of the tough decisions that Mike had to make in the aftermath of the dot.com bubble bursting?

[35:40] Mike learned a useful skill during his early days at VerticalNet — seeing opportunities. How did that play into his experience at Nutrisystem?

[39:06] Mike regrets not taking Nutrisystem private. He explains why.

[42:47] How did Mike raise capital? Mike shares the trajectory of Nutrisystem from 2005 to 2008, and briefly after he re-joined the company.

[48:04] Mike talks about some of the numbers behind the business. 

[51:19] Who were some of the celebrities that got behind Nutrisystem?

[54:08] How did Mike get involved with LifeShield?

[59:52] What is the business model for LifeShield?

[1:02:11] As a consumer, ADT is the category killer, and LifeShield is considerably smaller. How does LifeShield compete?

[1:04:21] What kind of technology was LifeShield holding on to at the time?

[1:06:08] LifeShield was sold to DirectTV, and then eventually bought it back from them. Mike shares the process.

[1:15:28] Who did Mike bring in as investors?

[1:16:26] Hawk Capital lists a lot of requirements for potential investments. Mike explains some of the reasoning behind that.

[1:20:00] Mike is competing with a lot of capital to get good investments. How does he manage that?

[1:23:19] How important was the Philadelphia region to Mike's journey? What is Mike's hope for his alma mater?

Links:

Mike Hagan

VerticalNet

Nutrisystem

Trivity

LifeShield

DirectTV

SJU

AT&T

Netscape

Safeguard Scientifics

Ira Lubert

eBay

Yahoo

Lycos

AltaVista

AskJeeves

Mark Walsh

AOL

Microsoft

SoftBank

British Telecom

Satya Nadella

WebMD

NewSpring Capital

Blackstone

Lehman Brothers

Dawn Zier, CEO of Nutrisystem

Louis A. Stilp

Steve Jobs

Apple

ADT

Comcast

Verizon

Amazon Ring