Sign up to save your podcasts
Or
Share Smart Bear Live 7: More from AZ Disruptors
Share to email
Share to Facebook
Share to X
Share to email
Share to Facebook
Share to X
Or
Smart Bear Live 7: More from AZ Disruptors
Welcome back to Smart Bear Live, the call-in show with Jason Cohen, sponsored by Software Promotions. In this episode, we share three more interviews from our AZ Disruptors meeting last fall. Hamid Shojaee, CEO of Axosoft, cohosts a group of Phoenix-area startup founders (Jason was on Skype video – everyone else was in the room … it works way better than you’d think):
Listen to this episode if you want to learn about getting your great new solution in the hands of important customers … decide whether or not to work with a cofounder … and how to get a board of advisors.
And please tweet your thanks to Software Promotions for sponsoring Smart Bear Live! (e.g., “Thanks @TheDaveCollins for sponsoring #SmartBearLive!” or just retweet this one).
You can subscribe to Smart Bear Live on iTunes (please review the podcast as well!) … and if you’d like to appear on a future episode of Smart Bear Live, send an email to [email protected] to schedule a recording with Jason.
Transcript
Automated transcription services provided by:
Dan: Hey, Jason.
Jason: Hey. What’s the name of the company?
Dan: The name of the company is Member Desk.
Jason: Member Desk? You know, my daughter, she’s only 2 and Member is how
she says remember so it makes me think about just how you remember, but
that’s not most people. But Member Desk sounds like you run some kind of
organization and the front desk is sort of the metaphor for a lot of stuff.
There’s a sign in sheet for volunteer stuff. There’s scheduling. There’s I
don’t know, memberships. There’s just stuff and most organizations are bad
at it and don’t have somebody devoted to it. So Member Desk is a virtual
and yet it can also be physical, literally sitting in the front of the co-
working space inexpensive way to do that for pretty much any organization.
Dan: That’s pretty decently close, actually.
Jason: Right. So what is it really?
Dan: Member Desk is a hosted membership site software. Let’s people sell
premium digital content online without dealing with any of the technical
stuff.
Jason: What is premium digital content mean?
Dan: Videos, music.
Jason: Why is that premium?
Dan: Because you’re not giving it away for free. You want people to pay
for it.
Jason: Premium means for money.
Dan: For money. Yes.
Jason: So selling music.
Dan: Music, videos.
Jason: Because you said premium digital media, so I didn’t get selling
music out of that.
Dan: Yes. That’s one of the possibilities.
Jason: Selling music. Selling videos. Selling stuff that can be delivered
electronically but you want to make money. Aren’t there a bunch of
companies who deliver stuff electronically and let you make money on of it?
Dan: There’s a difference. Basically Member Desk creates a membership site
for you where people will pay you, say, on a monthly basis. $10 a month,
$50 a month, whatever, and then they get the user name and password to
access their membership site; Then they get access to all the content that
you allow them access to based on how long they’ve been a member.
Jason: OK. So this is a Paywall-type thing. This is like what Andrew
Warner does with Mixergy. Where, if you sign up to be a member and pay
monthly, then you get access to the whole archives and all this other
stuff. You’re in once you pay.
Dan: Yes. Exactly.
Jason: OK. And so this is a way for just everybody to implement that.
Dan: Yes.
Jason: That sounds good.
Dan: It could work for anybody, but what we’re doing right now is we’re
focusing on the music industry; because we’re actually running the
premium fan site for the 70′ band Chicago right now, and they’re super
happy with it so we decided to focus on musicians. Because musicians have a
ton of content that can be sold digitally. And that kind of leads into my
question because music and all content really is a pretty tough industry.
So my question is how do you get to the people that you need to talk to in
these industries? How do you get to the decision makers when they have so
many people guarding the door?
Jason: They do. They do, and when you get into music or Hollywood it’s the
worst. Like at least in IBM you try to get into IBM but you know what
titles to go for and find them in LinkedIn and they have admins, but you
can get around those admins and all that. Hollywood and music, you can’t
call Madonna. That’s not ever going to happen. Those kinds of industries
are very much who do you know and that kind of stuff, unfortunately. So
actually I have been advising a company in Austin, who is also in the
music industry; and they actually started with an idea not dissimilar from
what you described, but they are not doing it now. They now do extra-
merchandise so fan selling other fans merchandise that they made but this
time with IP rights and everybody makes money, which is pretty cool. But
they had the exact same problem. That they had to sell the band on it. One
thing I learned from there, is that the manager is the first step. If the
band members want to do it, that’s fine but A, They are harder to find
anyway. And B,The manager often is the one controlling how the money works.
So, if the manager’s on board, you’re probably going to start and if not,
you’re don’t regardless of the band. So the manager, that’s one thing. And
the good thing about managers is that they manage multiple bands, and all
the managers know each other too. So the good news is, if you can get your
wedge in there, one manager levers you into bunch of bands, which is
already nice and that therefore more with your effort; and it’s easier
once you’re intrenched that you could be this person doing this. But if it
were easy to break in with a product for the music industry, which is sort
of like, “I got a game. How do I get people to know about it?” They’re
like, It’s a game. It’s hard. It’s expensive.
There isn’t an easy, cheap way to make everybody know about a game because
everybody is making a game. So it’s not going to be a patent answer. But I
wonder if one answer could be that there are these other technology
companies like this one I’m talking about. It’s called Bitvibe. They do
have some traction. I wonder if another technology company in which you
don’t compete, so that then doing one thing means they wouldn’t do the
other and yet you’re both going after the same people. I wonder if it would
be useful to team up with one of them. Not to merge companies or anything
like that, but simply to say “We’re all trying to get in here. We don’t
compete. Maybe we should try to share some of this as we go because we’re
all trying to do this.” It could work although people are usually pretty
tight about that. The way Bitvibe broke in is that the co-founder is the
drummer for several really big bands that you’ve heard of from the 80’s and
right now he’s in Gregg Rollie Band. Gregg Rollie is the other guy in
Carlos Santana. So pretty top, not A+ list but enough. But the answer is
the co-founder’s been in the industry for 30 years and he’s somebody and so
they can get meetings. So, like in most things, is who you know and
networking and finding out the next person in line, the next person in
line.
Patrick: You know, I think most start ups are not like that. In other
words, if you look at the most start ups on Earth, their success is not
depending on who they know. But in music and film, I’m not sure I know
people who just break into music and don’t know anybody and have no ends.
That’s a tough one. Hamid, do you have any insight in this?
Hamid: It’s kind of interesting. So Member Desk is actually an AC
disruptors company, that incubator that we have going here. So Leon and I
have met numerous times, about marketing strategy and the music one is that
developed after Chicago became a customer. But until they had become a
customer I think the thought was that the site might be used more for
people who have very popular blogs or they have content that they write
about about sports or medicine or whatever topic that they become an
experts on. Then over time they start building a library of that content
that they then sell as a monthly subscription of some kind. Or maybe they
have forums that they have premium access for the members. So that was sort
of the direction that we thought about going in and it’s just hard to
figure out the marketing strategy around that.
Dan: Exactly. One of the things is that it’s software that can be used by
pretty much anybody so how do you narrow it down? How do you focus?
Jason: Yes. I think you do have to focus. You probably don’t have enough
time and money and energy to go after multiple markets at the same time so
having Chicago, that’s fantastic. And again, if you’re successful with
them, if they show success, which they have big enough of a fan base, you
should be able to.
Dan: They’re very happy so far.
Jason: They may be happy but if you show some sort of objective success
like look, Chicago had, I’m just making this up, 200,000 people in their
email list, they had 77,000 people in their fan club, which by the way was
people literally mailing out their things and getting stuff. And they’ve
successfully moved most of those people to this, and now making monthly
money and more money than ever before because of this, and now they’re all
digital and now so easy to do that, and you have that complete story, I
don’t know why their manager wouldn’t push you on to the other bands they
manage. It’s more money for everybody.
It’s like why would this not happen? So I think you use this, again, as a
wedge and go from there if you really focus on getting this out of the
park. Not just they’re happy but the next person has to be bowled over,
whatever that means. Alternately, if you wanted to go after this other
stuff, I think you can certainly can. I think that makes sense, that
market, and it’s even pretty obvious how to find those people. They sort
of, like there’s some standard places that everybody like that reads. Like
a lot of people that read Copy Blogger are the kind of people that might do
that, and Copy Blogger does guest posts and does other things that you
could assume insinuate yourself in. There’s even conferences around
conferences that you could go to where those kind of folks are. These
people like the guy behind I will teach you to be rich, I forgot his name.
Dan: Ramit.
Jason: Ramit. He’s a conduit to it and first of all he’s a perfect
customer for this. Although, we don’t need to go in deep in that. He might
not be just because of his particular style but what he is is definitely
the kind of guy that if he got behind this and explained this as a
strategy, he might be able to put 1,000 in your lap.
Dan: Interesting.
Jason: So going after those kinds, the influencers of those people like
Ramit. So in other words, it’s pretty clear how you would go after that
thing that’s a growing market. There’s a lot of people who are experts or
have a book that want to make money in other ways just like this. Bob Welsh
is another one who is sort of plugged in that kind of world, and is helping
other people through that kind of thing right now. I think there’s
definitely places. The fact that Andrew Warner id doing this at the moment.
He’s obviously got an implementation already. but he would have probably
use this had it been available.
Dan: I don’t know if you’ve heard. Lous C.K. just came out with the same
exact model
Jason: I did. The same thing, right. It was just $5 period but how much
better would it be if it was $5 a month. You’d be under the gun to produce
more content, I guess. But I don’t know. As fans, of Louis C.K. maybe you
do it, because you’re fans.
Dan: If you’re a big fan you would.
Jason: What about Adam Corolla? I could totally see some kind of special
with Adam Corolla. Or another example would be This Week in Start-ups.
Where they have the producers thing. It’s the same thing. It’s an
exclusive club, blah, blah, blah. Any podcast or maybe blogger, but
podcast, for sure, like them, that’s over a certain number of listeners,
and that’s not a million people, but it’s 1,000?
Dan: Yeah.
Jason: And you know how to find them because just go look at iTunes and
go through the top lists and just go. So I think it’s pretty clear how
you’d reach out and do that, but that’s a whole different thing than trying
to make Chicago work.
Dan: Yeah, exactly.
Jason: I do think you have to decide, for now. That doesn’t mean you
can’t decide “Nah, screw it. Let’s go after the other one”.
Dan: Yeah.
Jason: Right. You can do that any time you please and that’s OK, but I
think you have to decide now. But of course, braking in at the very
beginning is hardest in any industry, for any start-up, of course it’s a
huge challenge, of course there’s no easy answers, but I’ll give you one
other possible answer because you’re talking about breaking in. When you
say break in it usually means at the top.
Dan: Yeah.
Jason: How do I get in front of Lady Gaga’s manager? Yeah, I don’t know.
Right? So there is the other direction, and it’s harder but it’s sort of
if you can do it then you’re in the driver’s seat and you can just do it
which is to go the other direction. Go after the Lady Gaga fans somehow
directly.
Dan: Interesting.
Jason: Make the unofficial Lady Gaga Fan Club which they pay for and when
they come knocking on your door saying “There’s thousands of people. We’re
getting emails all the time. They’re paying money. Who the hell are you?”
you say “You’re right. I don’t want to own this. I want you to own this.
I was just trying to get your attention. Now, let’s talk about you can
actually promote this and make it from 1,000 people to 100,000 people and
we can all make a bunch of money”.
Dan: Interesting.
Jason: See what I mean? Now, I don’t know that that’s easier because
it’s a bunch of consumers, how do you reach them, I don’t know. They don’t
read Hacker News, so I don’t know. That’s not necessarily a great idea,
but it’s a brainstorm of you can go the other way to get their attention
potentially.
Dan: Great, I like that. It’s something to look into. It might not be
easier, but something to look into.
Jason: You know, it may be easy for a particular band or something.
There’s some reason why you have an in with the fan groups of one of them,
like there’s a local chapter guy and he thinks it’s the best thing ever.
You’re like “Well then get your local chapter on” and he does and so in
other words it still might be just a wedge to get in, but that guy’s easier
to find. The chapter organizer of Lady Gaga Fan Club in Arizona, that
person you can locate and you can talk to that person. So, you know,
there’s not as powerful, but at least you can talk to them.
Dan: That’s true.
Patrick: Hey Jason, Patrick, sorry. Going in the other direction I
thought you were going to say go after smaller bands that have more
immediately to gain, so there’s bands who play for 1,000 people a night who
might really need the money that this generated. What do you think about
going after smaller bands instead of huge acts?
Jason: For sure. It’s always easier to get at the smaller people.
There’s probably some clips where the amount of money they could generate
is actually not that interesting.
Dan: Yeah.
Jason: And they probably don’t have a very good, well, some of them might
have a good connection with their fans and be able to move them to do it.
But another thing I learned is that a lot of these big bands, they have a
ton of fans but they really don’t know how to message them.
Dan: Yeah, that’s true.
Jason: You may have a million Twitter followers, they probably don’t.
They may have a mailing list, it’s probably not even around the number of
fans they actually have. If they’re really organized they have a fan club,
and Chicago probably does because they’re so big and organized, but the
smaller ones surely don’t. So maybe if you found the smaller bands who are
also really good at communicating with their community. That might be a
good sweet spot, because then they may be able to get 1,000 people to pay
them $5 a month, and that’s pretty good.
Dan: Yeah, for a band that’s great.
Jason: It’s possible. I mean, it’s easy to talk to very little bands and
just say I feel like the amount of revenue for you is very little. The
amount of training and selling is very high. So I don’t see that, again,
as a stepping stone, OK, maybe, but even so if you have little piddly bands
that go around and don’t make a lot of money, I still don’t see how that
leads you to the managers of the big bands and convincing them that they
will make a lot of money. I don’t think one leads to the other, so I’m not
sure that you’re making that much progress.
Patrick: OK.
Jason: That direction, but maybe medium. I’m not sure. This is still
outside my, you know, I don’t know that much about the market of this, so I
don’t really know how those behaviors go.
Patrick: That’s cool.
Dan: Great. Thanks for all those ideas.
Jason: By the way, one last one is if you find a power manager that runs
40 people and they actually give you the time of day and think it’s pretty
cool take them into the fold so that they personally want to do this. Give
them a small percentage of the company, but they have to bring in, not for
nothing, they have to contingent upon them bringing 10 bands, or a certain
amount of revenue, I don’t know, something that you would then say “Oh man,
is that worth it”.
Dan: OK.
Jason: Because then they’re personally motivated to do this for you, not
even just for money. Now it’s pride and then telling everybody how they’re
an investor in this hot tech start-up and all this garbage. That’s what
you’re also giving them so that they want to go do this for you.
Dan: That’s great.
Jason: If that helps you mint the company it’s totally worth, I don’t
know, 5% of the company.
Dan: Yeah sure.
Jason: If that lands you 10 big acts and gets the ball rolling and gives
you legitimacy and blah, blah, blah and he can pick up the phone, my God,
that’s clearly worth it.
Dan: That’s great.
Patrick: Awesome.
Dan: Thanks, yeah.
Patrick: Thanks Dan.
(strum)
Interviewee: Jason, how are you doing? My question is, what’s your opinion
on co-founders? So, the company I’m in now is not a software company and
I’m really interested in that space. I have degrees in computer science and
networking but I haven’t kept up on the latest technologies. What’s your
opinion on finding a co-founder? Like somebody who is more of a technical
person, versus just learning the new technologies myself and implementing
something.
Jason: Well, I think the decision of having a co-founder or not is very
personal. I don’t think there is answers, or industries, or things. I feel
like some people probably are just too much of a control freak to really
have a co-founder.
Interviewee: Right.
Jason: Then there are other people who are only comfortable with a co-
founder. And of course there’s the usual pros and cons right? Like with
more people who are not taking salary, you can literally do twice as much.
And that’s really important for an early stage start-up to be able to move
as fast as possible etc., etc. But you also have to agree on things and
this and that. Also when you go through the down and ups with someone else,
that’s just so much better than having to rough it on your own. It is rough
to do it by yourself. But then again, especially looking ahead to what does
it mean when you start taking salary, and how do you divide up the company
and what if it goes sour, which it often, often does. In three years what
happens? And if you sell the company can you sell it for enough that
everyone still. So again, there are clearly pros and cons. I guess I don’t
understand the context in which you are asking. You’re saying you haven’t
kept up with the technology, so should you go find someone who has? That
doesn’t seem like a good reason to do anything.
Interviewee: Should I find somebody that is up on the latest technology,
so then I don’t have to waste a year.
Jason: Why? Who cares? Why do you have to make a company on the latest
technology?
Interviewee: Well, I’m talking web development. I haven’t really developed
any web applications. It’s a web app that I want to do.
Jason: So you’ve never done a web app and you want to make a web app
company.
Interviewee: Yeah.
Jason: Then I would get someone else who’s done it. Or, decide that this
is going to take a long time. Which is okay. Is it Okay if this takes a
long time? Or is this a race?
Interviewee: No, there’s no race.
Jason: Oh, well then you can decide. Because you could get someone and
then you go faster or you could say, “No, I want to learn this. There’s no
time pressure so I’ll simply take a long time to build it and who cares.”
Interviewee: Yeah, that makes sense.
Hamid: The other thing to consider is, is it going to be a technology
company? Or are you building a web app to service a non-tech field. And
that’s sort of an interesting thing because if you’re building a web
application that could sort of not be on the latest technologies and have
the greatest whiz-bang UI interfaces, and the greatest user experience; but
you are servicing this market that is way under-served. The one thing that
you might be able to do is outsource the development costs of it. I don’t
know what your investment potential is.
Interviewee: Right.
Hamid: But if you’re trying to build a technology company without having a
technology co-founder, I think that would be a huge problem.
Jason: I agree.
Interviewee: Thanks.
(strum)
Gelie: Hi.
Jason: Hi.
Gelie: All right, so the name of my company is networkingphoenix.com.
Jason: Yeah, and folks who have common interests and want to find each other
in the interest groups that they can go to can find each other on this
centralized location.
Gelie: Very good. I’ll give you an A. So, basically what it is, is it’s a
website, and we compile and promote all the different business networking
events in town on the calendar.
Jason: Right.
Gelie: So the core of the site is the calendar, and the reason people come to
the site is because of the calendar. Then we have different things built
around it. So, when you land on the site and try to click on anything it
will let you view the event once, but then it says “Hey, if you want to see
more events now you’ve got to create a profile”. So, they go to create a
profile, and it’s free. It’s like LinkedIn, right?
Jason: Right?
Gelie: So you create a free profile, you promote your business, whatever you
want to promote, and now you’re in my database. So, we’re three years old.
We’ve got about almost 20,000 members.
Jason: Wow.
Gelie: We are actually one of the most popular local websites here in Arizona.
Jason: Yeah.
Gelie: And four times a year we do these big networking events where we get
about 1,500 to 2,000 people attending.
Jason: Wow. Where do you do that?
Gelie: Resorts here in Phoenix.
Jason: Oh wow. That’s cool.
Gelie: Glad you think it’s cool.
Jason: How much do you charge them to attend one of these events?
Gelie: Well, it’s free.
Jason: No!
Gelie: But no, it’s free for them to attend. Well, it’s not free for the
sponsors and the people that exhibit at these events.
Jason: Well yeah, but man, even if it was $5.
Gelie: Right. Everybody says that. But that’s why nobody has events as big
as ours because everybody gets greedy and wants to charge, right?
Jason: Fair enough.
Gelie: So this is where we’re different.
Jason: But you make some money on the event?
Hamid: I like how she at least answers that question.
Gelie: Oh, I’m sorry.
Hamid: She’s like bam!
Jason: No, no. That’s good.
Hamid: Exactly. She knows her business. It’s very good.
Jason: I mean, you could still have premium members who decide they want to,
just like LinkedIn, right? You pay, you get a little more.
Gelie: Wait, wait, wait, wait. Right. So I was going to say the core of
business…
Jason: But you make money on these events, right? Because of the sponsors,
but you make money on these events, right?
Gelie: Correct. The core of the business though, the revenue model, so it’s
free to join, but then there’s the optional paid membership.
Jason: Right.
Gelie: Right? So it’s $10 a month. You sign up, then the monthly and then we
have an annual, but you can attend other organization’s events for free.
So I negotiate the free tickets and I just become this middle person.
Jason: Right.
Gelie: So you sign up for free, and you get your passport and now you can
attend different chamber mixers and all this other good stuff, different
educational seminars. So in a nutshell-
Jason: How many people do that?
Gelie: Right now we have just over 1,000 and we’ve had the product out for
about a year and a half.
Jason: That’s a long time.
Gelie: It is a long time, and so we’ve been watching the trend, right? So,
when do they sign up? Why do they sign up? Why do they drop off? So,
there’s definitely things we know we need to improve on but we haven’t
been, I haven’t had the data, right? So I didn’t know. Now that I do
know we’re kind of getting into that phase of “Okay, now we have to take
this product and fill in all the different gaps”, right? So why are all
these people falling off? Well the good thing is a lot of them actually
tell us why they’re leaving. So we know we can improve. But, that’s not
really, so my question to you is, So where I am in the business is we want
to expand, right? So we want to take this to different cities and keeping
that local feel. So we’ve got networkingphoenix, networkingsandiego,
networkingwhatever, fill in the city. So we’re kind of trying to put
systemizing everything; but what I’m struggling with is going into year
three because everybody’s been doing their own thing, right? I’m actually
very fortunate because I’ve had the same employees pretty much since day
one.
On one hand that’s good; on the other hand that’s bad, because I don’t
really know what they do on a daily basis. So, we’re trying to systemize
it so I know I have 10 minutes here, so actually, I’m not going to ask you
that question, because I’m more interested in my other question, which is
how do I build a board of advisers? Okay, so this is kind of a few part
question I’m going to ask you and then you can give me your overall thought
process. So I’m looking to build a board of advisers because I kind of
need a sounding board or I feel like i could use a sounding board and then
really why would somebody want to be on my board, right? Because I’ve met
with a few VCs and Angels and I’m not really looking for money as of right
now, but I always just kind of like to bounce ideas off of them and they’re
like “Well, you know, if you’re talking to me, that means, and I’m a VC,
that means I’m going to want to invest and blah, blah, blah” but then they
say “But not everybody would want to invest”. So, Okay. How do I find
these people?
Jason: Well what do you want them to do?
Gelie: I need a sounding board, right? Because I need to be able-
Jason: Well then just find, you’re a network of, you know 20,000 people. I’m
serious. So what you need is to find people like, they’re business-savvy,
they’re interested in this for whatever reason, they also want you to
succeed, they like you personally, and that’s it. Then they’ll be a good
sounding board.
Gelie: Okay. Right. But, I mean, not like how do I approach them, but, yes,
how do I approach them, only because I’ve never been in the situation and I-
Jason: You’re a networker.
Gelie: Listen, I know, but I get it. I can approach a lot of people, but I’m
not going to approach a lot of people.
Hamid: I take cash if you’re…
Jason: Yeah.
Jason: I don’t see what the dillema is. You literally say…
Woman: Why? Why would they want to be in my board? Okay, there’s this “why
would they want to be in my board?” So maybe, you can give me some insight.
Is it because they just want to put their name on something cool, or what?
Hamid: The problem that you’re describing is one that a lot of founders
have. Jason, maybe you can sort of elaborate on this. But I think it’s
difficult to ask people, even if those people would be more than willing to
do it for free or to spend their time making other people successful,
because somebody helped them along the way. But it is difficult to ask, and
that’s one of the things that, as an entrepreneur, you have to sort of get
over the hurdle that you have to get over. But how do you get over sort of,
how do I approach this person?
Gelie: Right.
Jason: To ask, and what are they going to think of me, you know?
Gelie: Right. Yeah. Because there’s a million people that I’m sure will
want to do it…
Jason: Hold on. Hold on.
Gelie: But I don’t want them on the board.
Jason: Right.
Jason: You don’t seem like you have a problem approaching people and
talking to people…
Gelie: I’m shy.
Jason: Or saying whatever you think. Okay. So that’s not the problem.
Gelie: You’re right.
Jason: You’re afraid that that they don’t… Why would they volunteer
their time? What’s in it for them? Is that what you’re worried about?
Gelie: Yes. Yes. Yes.
Jason: Well, Okay. Number one. Who cares? As long as they want to do it,
it’s Okay.
Gelie: Okay.
Jason: Number two. People do it because it is fun for people who are doers
and are intelligent and like thinking about problems to hang out with other
people who are like that and to see those things happen. That is just fun.
That’s life.
Gelie: Right.
Jason: It is fun and life. Imagine how many emails I get asking to pick my
brain about this with that, right? And everyone, of course, the automatic
answer is no because of the time, just time. But every once in a while, I
say yes. And why do I say yes? Because that person just seems like they’d
be interesting and they’re doing something cool, and they seem like they’re
serious, which you obvious are because you got a growing concern and all
that. You just want to. I’ll put it this way. All these organizations and
stuff, where people are obviously at a net loss in time and money for
pretty much any organization in town that you send people to, why are they
doing that? Because they want to hang with people who are interested in
that thing and talk about it. That’s why they’re doing it.
Hamid: One of the things that I’ve done a few years back, a couple of, me
and buddy, who happens to also have a software company, we were talking. We
thought exactly the same thing. It would be great if we could have a sort
of advisory board, and we ended up inviting five other people, that
happened to be from all over the country, that also have software
companies, to a joint meeting in Las Vegas that we were going to spend a
day talking about our businesses. That meeting turned into, now, we’ve been
doing it for five years. Every five, six months, we travel to a city of one
of the companies. It might be Dallas, or Toronto in Canada, or Florida or
Boston, where each of the companies are and we’d become each other’s sort
of sounding boards and advisory boards for a day; and we’d take turns going
around the table. So one way would potentially be a mutually beneficial
thing, rather than just, simply, incoming advice, right? Rather than a
board of advisers that’s just for you, what about a board of peers that you
give them just as much advice as they give you? That sort of worked out
really well for us. So that’s another thing to consider, another way to go.
Jason: Yeah. I agree 100%. I know quite a few people who do that. Usually,
it’s local just because it’s easier, right? You just find other local
entrepreneurs that you can just meet with once a month.
Jason: Well, that’s…
Gelie: But, yeah…
Hamid: It’s hard, often times, local. But even if it’s international, not
international. But even if it’s national, our trips cost about $1000 per
trip. And we do it every three, four, five months. So let’s say three times
a year, I spend $1000 on a trip. So that’s $3000 a year on an amazing sort
of meeting that I couldn’t have locally because those companies don’t exist
locally. I can’t find seven other software companies about my size.
Gelie: Right. Right. And that actually was my point, is that yeah, you’re
right, there are a lot of people, but I don’t want to talk to them.
Hamid: Right.
Woman: Because it’s unsolicited advice and more than anything
Jason: Look. I think what you should do is decide who are the people that
would be perfect for the board…
Gelie: Right. Which was…
Jason: And then just go ask them to be on it, and then when they say yes,
you can ask them, why then? And that would be a…
Hamid: Why are you wanting to do this?
Jason: This is really easy. I don’t
know…
Gelie: But seriously… It’s good for me get some feedback and insight on
it just because, like I said, I don’t know, this is like a new arena and I
typically don’t like to talk to people about my business and details. I
mean, I have certain people I talk to about it, not bringing outsiders in.
So, the few times I did venture into that world, it was kinda of ugly
because maybe I met with some wrong VC’s or whatever.
Jason: I don’t know. You’re just, I don’t know, justifying something? Just
do it already. You said you want a board adviser, so go get one, and if
you’re not comfortable with it, then don’t do it. I mean, just do it, and
then you can ask them why. By they way, I know we’ve got to go, but you got
to charge more than $10 per person, because right now you’re making $10
grand a month off of that and that’s not enough, especially if you want to
spread out to other cities because there’s no… I mean, to what end? So
you can hire one more person. I mean…
Hamid: It’ll turn back on in just..
Jason: That doesn’t make any sense to me.
Gelie: We tried. That’s actually really interesting feedback, and we tried
doing that and it did not work as well as $10. We actually make more money
charging out $10 because more people sign up and stay longer than…
Jason: Okay. Well, that’s fine. But then, in some other way you need to be
making more money, or else, I don’t know why your’e even going to a
location.
Gelie: That’s not the only revenue stream. That’s the core of it, but the
thing is I have 20,000 people to sell to, and I haven’t even had a
marketing program for it. It just runs itself.
Jason: Well, maybe you should do that before you expand to other cities.
Gelie: Absolutely.
Jason: In other words, you haven’t figured out this model, yet, that’s
really cutting off money.
Gelie: Right. Oh, right. So we’re not expanding tomorrow, but in order to
expand, so this is exactly why I’m looking to place people around me, so I
can actually bounce things off other people because I haven’t had that this
whole time, so.
Hamid: Your first step is to systemize everything. And then…
Gelie: Exactly. Right. Which is what I was starting with because we need
to just get this system down.
Jason: More money.
Gelie: Yeah. No, absolutely. I mean, like I said, there hasn’t even been a
marketing program for this passport program.
Jason: All right.
Gelie: All right. I’m taking up to much time.
Hamid: No, you’re…
Gelie: Thank you.
Jason: Thank you.
Patrick: Thanks.
The post Smart Bear Live 7: More from AZ Disruptors appeared first on @ASmartBear.
View all episodes
By @ASmartBearWelcome back to Smart Bear Live, the call-in show with Jason Cohen, sponsored by Software Promotions. In this episode, we share three more interviews from our AZ Disruptors meeting last fall. Hamid Shojaee, CEO of Axosoft, cohosts a group of Phoenix-area startup founders (Jason was on Skype video – everyone else was in the room … it works way better than you’d think):
Listen to this episode if you want to learn about getting your great new solution in the hands of important customers … decide whether or not to work with a cofounder … and how to get a board of advisors.
And please tweet your thanks to Software Promotions for sponsoring Smart Bear Live! (e.g., “Thanks @TheDaveCollins for sponsoring #SmartBearLive!” or just retweet this one).
You can subscribe to Smart Bear Live on iTunes (please review the podcast as well!) … and if you’d like to appear on a future episode of Smart Bear Live, send an email to [email protected] to schedule a recording with Jason.
Transcript
Automated transcription services provided by:
Dan: Hey, Jason.
Jason: Hey. What’s the name of the company?
Dan: The name of the company is Member Desk.
Jason: Member Desk? You know, my daughter, she’s only 2 and Member is how
she says remember so it makes me think about just how you remember, but
that’s not most people. But Member Desk sounds like you run some kind of
organization and the front desk is sort of the metaphor for a lot of stuff.
There’s a sign in sheet for volunteer stuff. There’s scheduling. There’s I
don’t know, memberships. There’s just stuff and most organizations are bad
at it and don’t have somebody devoted to it. So Member Desk is a virtual
and yet it can also be physical, literally sitting in the front of the co-
working space inexpensive way to do that for pretty much any organization.
Dan: That’s pretty decently close, actually.
Jason: Right. So what is it really?
Dan: Member Desk is a hosted membership site software. Let’s people sell
premium digital content online without dealing with any of the technical
stuff.
Jason: What is premium digital content mean?
Dan: Videos, music.
Jason: Why is that premium?
Dan: Because you’re not giving it away for free. You want people to pay
for it.
Jason: Premium means for money.
Dan: For money. Yes.
Jason: So selling music.
Dan: Music, videos.
Jason: Because you said premium digital media, so I didn’t get selling
music out of that.
Dan: Yes. That’s one of the possibilities.
Jason: Selling music. Selling videos. Selling stuff that can be delivered
electronically but you want to make money. Aren’t there a bunch of
companies who deliver stuff electronically and let you make money on of it?
Dan: There’s a difference. Basically Member Desk creates a membership site
for you where people will pay you, say, on a monthly basis. $10 a month,
$50 a month, whatever, and then they get the user name and password to
access their membership site; Then they get access to all the content that
you allow them access to based on how long they’ve been a member.
Jason: OK. So this is a Paywall-type thing. This is like what Andrew
Warner does with Mixergy. Where, if you sign up to be a member and pay
monthly, then you get access to the whole archives and all this other
stuff. You’re in once you pay.
Dan: Yes. Exactly.
Jason: OK. And so this is a way for just everybody to implement that.
Dan: Yes.
Jason: That sounds good.
Dan: It could work for anybody, but what we’re doing right now is we’re
focusing on the music industry; because we’re actually running the
premium fan site for the 70′ band Chicago right now, and they’re super
happy with it so we decided to focus on musicians. Because musicians have a
ton of content that can be sold digitally. And that kind of leads into my
question because music and all content really is a pretty tough industry.
So my question is how do you get to the people that you need to talk to in
these industries? How do you get to the decision makers when they have so
many people guarding the door?
Jason: They do. They do, and when you get into music or Hollywood it’s the
worst. Like at least in IBM you try to get into IBM but you know what
titles to go for and find them in LinkedIn and they have admins, but you
can get around those admins and all that. Hollywood and music, you can’t
call Madonna. That’s not ever going to happen. Those kinds of industries
are very much who do you know and that kind of stuff, unfortunately. So
actually I have been advising a company in Austin, who is also in the
music industry; and they actually started with an idea not dissimilar from
what you described, but they are not doing it now. They now do extra-
merchandise so fan selling other fans merchandise that they made but this
time with IP rights and everybody makes money, which is pretty cool. But
they had the exact same problem. That they had to sell the band on it. One
thing I learned from there, is that the manager is the first step. If the
band members want to do it, that’s fine but A, They are harder to find
anyway. And B,The manager often is the one controlling how the money works.
So, if the manager’s on board, you’re probably going to start and if not,
you’re don’t regardless of the band. So the manager, that’s one thing. And
the good thing about managers is that they manage multiple bands, and all
the managers know each other too. So the good news is, if you can get your
wedge in there, one manager levers you into bunch of bands, which is
already nice and that therefore more with your effort; and it’s easier
once you’re intrenched that you could be this person doing this. But if it
were easy to break in with a product for the music industry, which is sort
of like, “I got a game. How do I get people to know about it?” They’re
like, It’s a game. It’s hard. It’s expensive.
There isn’t an easy, cheap way to make everybody know about a game because
everybody is making a game. So it’s not going to be a patent answer. But I
wonder if one answer could be that there are these other technology
companies like this one I’m talking about. It’s called Bitvibe. They do
have some traction. I wonder if another technology company in which you
don’t compete, so that then doing one thing means they wouldn’t do the
other and yet you’re both going after the same people. I wonder if it would
be useful to team up with one of them. Not to merge companies or anything
like that, but simply to say “We’re all trying to get in here. We don’t
compete. Maybe we should try to share some of this as we go because we’re
all trying to do this.” It could work although people are usually pretty
tight about that. The way Bitvibe broke in is that the co-founder is the
drummer for several really big bands that you’ve heard of from the 80’s and
right now he’s in Gregg Rollie Band. Gregg Rollie is the other guy in
Carlos Santana. So pretty top, not A+ list but enough. But the answer is
the co-founder’s been in the industry for 30 years and he’s somebody and so
they can get meetings. So, like in most things, is who you know and
networking and finding out the next person in line, the next person in
line.
Patrick: You know, I think most start ups are not like that. In other
words, if you look at the most start ups on Earth, their success is not
depending on who they know. But in music and film, I’m not sure I know
people who just break into music and don’t know anybody and have no ends.
That’s a tough one. Hamid, do you have any insight in this?
Hamid: It’s kind of interesting. So Member Desk is actually an AC
disruptors company, that incubator that we have going here. So Leon and I
have met numerous times, about marketing strategy and the music one is that
developed after Chicago became a customer. But until they had become a
customer I think the thought was that the site might be used more for
people who have very popular blogs or they have content that they write
about about sports or medicine or whatever topic that they become an
experts on. Then over time they start building a library of that content
that they then sell as a monthly subscription of some kind. Or maybe they
have forums that they have premium access for the members. So that was sort
of the direction that we thought about going in and it’s just hard to
figure out the marketing strategy around that.
Dan: Exactly. One of the things is that it’s software that can be used by
pretty much anybody so how do you narrow it down? How do you focus?
Jason: Yes. I think you do have to focus. You probably don’t have enough
time and money and energy to go after multiple markets at the same time so
having Chicago, that’s fantastic. And again, if you’re successful with
them, if they show success, which they have big enough of a fan base, you
should be able to.
Dan: They’re very happy so far.
Jason: They may be happy but if you show some sort of objective success
like look, Chicago had, I’m just making this up, 200,000 people in their
email list, they had 77,000 people in their fan club, which by the way was
people literally mailing out their things and getting stuff. And they’ve
successfully moved most of those people to this, and now making monthly
money and more money than ever before because of this, and now they’re all
digital and now so easy to do that, and you have that complete story, I
don’t know why their manager wouldn’t push you on to the other bands they
manage. It’s more money for everybody.
It’s like why would this not happen? So I think you use this, again, as a
wedge and go from there if you really focus on getting this out of the
park. Not just they’re happy but the next person has to be bowled over,
whatever that means. Alternately, if you wanted to go after this other
stuff, I think you can certainly can. I think that makes sense, that
market, and it’s even pretty obvious how to find those people. They sort
of, like there’s some standard places that everybody like that reads. Like
a lot of people that read Copy Blogger are the kind of people that might do
that, and Copy Blogger does guest posts and does other things that you
could assume insinuate yourself in. There’s even conferences around
conferences that you could go to where those kind of folks are. These
people like the guy behind I will teach you to be rich, I forgot his name.
Dan: Ramit.
Jason: Ramit. He’s a conduit to it and first of all he’s a perfect
customer for this. Although, we don’t need to go in deep in that. He might
not be just because of his particular style but what he is is definitely
the kind of guy that if he got behind this and explained this as a
strategy, he might be able to put 1,000 in your lap.
Dan: Interesting.
Jason: So going after those kinds, the influencers of those people like
Ramit. So in other words, it’s pretty clear how you would go after that
thing that’s a growing market. There’s a lot of people who are experts or
have a book that want to make money in other ways just like this. Bob Welsh
is another one who is sort of plugged in that kind of world, and is helping
other people through that kind of thing right now. I think there’s
definitely places. The fact that Andrew Warner id doing this at the moment.
He’s obviously got an implementation already. but he would have probably
use this had it been available.
Dan: I don’t know if you’ve heard. Lous C.K. just came out with the same
exact model
Jason: I did. The same thing, right. It was just $5 period but how much
better would it be if it was $5 a month. You’d be under the gun to produce
more content, I guess. But I don’t know. As fans, of Louis C.K. maybe you
do it, because you’re fans.
Dan: If you’re a big fan you would.
Jason: What about Adam Corolla? I could totally see some kind of special
with Adam Corolla. Or another example would be This Week in Start-ups.
Where they have the producers thing. It’s the same thing. It’s an
exclusive club, blah, blah, blah. Any podcast or maybe blogger, but
podcast, for sure, like them, that’s over a certain number of listeners,
and that’s not a million people, but it’s 1,000?
Dan: Yeah.
Jason: And you know how to find them because just go look at iTunes and
go through the top lists and just go. So I think it’s pretty clear how
you’d reach out and do that, but that’s a whole different thing than trying
to make Chicago work.
Dan: Yeah, exactly.
Jason: I do think you have to decide, for now. That doesn’t mean you
can’t decide “Nah, screw it. Let’s go after the other one”.
Dan: Yeah.
Jason: Right. You can do that any time you please and that’s OK, but I
think you have to decide now. But of course, braking in at the very
beginning is hardest in any industry, for any start-up, of course it’s a
huge challenge, of course there’s no easy answers, but I’ll give you one
other possible answer because you’re talking about breaking in. When you
say break in it usually means at the top.
Dan: Yeah.
Jason: How do I get in front of Lady Gaga’s manager? Yeah, I don’t know.
Right? So there is the other direction, and it’s harder but it’s sort of
if you can do it then you’re in the driver’s seat and you can just do it
which is to go the other direction. Go after the Lady Gaga fans somehow
directly.
Dan: Interesting.
Jason: Make the unofficial Lady Gaga Fan Club which they pay for and when
they come knocking on your door saying “There’s thousands of people. We’re
getting emails all the time. They’re paying money. Who the hell are you?”
you say “You’re right. I don’t want to own this. I want you to own this.
I was just trying to get your attention. Now, let’s talk about you can
actually promote this and make it from 1,000 people to 100,000 people and
we can all make a bunch of money”.
Dan: Interesting.
Jason: See what I mean? Now, I don’t know that that’s easier because
it’s a bunch of consumers, how do you reach them, I don’t know. They don’t
read Hacker News, so I don’t know. That’s not necessarily a great idea,
but it’s a brainstorm of you can go the other way to get their attention
potentially.
Dan: Great, I like that. It’s something to look into. It might not be
easier, but something to look into.
Jason: You know, it may be easy for a particular band or something.
There’s some reason why you have an in with the fan groups of one of them,
like there’s a local chapter guy and he thinks it’s the best thing ever.
You’re like “Well then get your local chapter on” and he does and so in
other words it still might be just a wedge to get in, but that guy’s easier
to find. The chapter organizer of Lady Gaga Fan Club in Arizona, that
person you can locate and you can talk to that person. So, you know,
there’s not as powerful, but at least you can talk to them.
Dan: That’s true.
Patrick: Hey Jason, Patrick, sorry. Going in the other direction I
thought you were going to say go after smaller bands that have more
immediately to gain, so there’s bands who play for 1,000 people a night who
might really need the money that this generated. What do you think about
going after smaller bands instead of huge acts?
Jason: For sure. It’s always easier to get at the smaller people.
There’s probably some clips where the amount of money they could generate
is actually not that interesting.
Dan: Yeah.
Jason: And they probably don’t have a very good, well, some of them might
have a good connection with their fans and be able to move them to do it.
But another thing I learned is that a lot of these big bands, they have a
ton of fans but they really don’t know how to message them.
Dan: Yeah, that’s true.
Jason: You may have a million Twitter followers, they probably don’t.
They may have a mailing list, it’s probably not even around the number of
fans they actually have. If they’re really organized they have a fan club,
and Chicago probably does because they’re so big and organized, but the
smaller ones surely don’t. So maybe if you found the smaller bands who are
also really good at communicating with their community. That might be a
good sweet spot, because then they may be able to get 1,000 people to pay
them $5 a month, and that’s pretty good.
Dan: Yeah, for a band that’s great.
Jason: It’s possible. I mean, it’s easy to talk to very little bands and
just say I feel like the amount of revenue for you is very little. The
amount of training and selling is very high. So I don’t see that, again,
as a stepping stone, OK, maybe, but even so if you have little piddly bands
that go around and don’t make a lot of money, I still don’t see how that
leads you to the managers of the big bands and convincing them that they
will make a lot of money. I don’t think one leads to the other, so I’m not
sure that you’re making that much progress.
Patrick: OK.
Jason: That direction, but maybe medium. I’m not sure. This is still
outside my, you know, I don’t know that much about the market of this, so I
don’t really know how those behaviors go.
Patrick: That’s cool.
Dan: Great. Thanks for all those ideas.
Jason: By the way, one last one is if you find a power manager that runs
40 people and they actually give you the time of day and think it’s pretty
cool take them into the fold so that they personally want to do this. Give
them a small percentage of the company, but they have to bring in, not for
nothing, they have to contingent upon them bringing 10 bands, or a certain
amount of revenue, I don’t know, something that you would then say “Oh man,
is that worth it”.
Dan: OK.
Jason: Because then they’re personally motivated to do this for you, not
even just for money. Now it’s pride and then telling everybody how they’re
an investor in this hot tech start-up and all this garbage. That’s what
you’re also giving them so that they want to go do this for you.
Dan: That’s great.
Jason: If that helps you mint the company it’s totally worth, I don’t
know, 5% of the company.
Dan: Yeah sure.
Jason: If that lands you 10 big acts and gets the ball rolling and gives
you legitimacy and blah, blah, blah and he can pick up the phone, my God,
that’s clearly worth it.
Dan: That’s great.
Patrick: Awesome.
Dan: Thanks, yeah.
Patrick: Thanks Dan.
(strum)
Interviewee: Jason, how are you doing? My question is, what’s your opinion
on co-founders? So, the company I’m in now is not a software company and
I’m really interested in that space. I have degrees in computer science and
networking but I haven’t kept up on the latest technologies. What’s your
opinion on finding a co-founder? Like somebody who is more of a technical
person, versus just learning the new technologies myself and implementing
something.
Jason: Well, I think the decision of having a co-founder or not is very
personal. I don’t think there is answers, or industries, or things. I feel
like some people probably are just too much of a control freak to really
have a co-founder.
Interviewee: Right.
Jason: Then there are other people who are only comfortable with a co-
founder. And of course there’s the usual pros and cons right? Like with
more people who are not taking salary, you can literally do twice as much.
And that’s really important for an early stage start-up to be able to move
as fast as possible etc., etc. But you also have to agree on things and
this and that. Also when you go through the down and ups with someone else,
that’s just so much better than having to rough it on your own. It is rough
to do it by yourself. But then again, especially looking ahead to what does
it mean when you start taking salary, and how do you divide up the company
and what if it goes sour, which it often, often does. In three years what
happens? And if you sell the company can you sell it for enough that
everyone still. So again, there are clearly pros and cons. I guess I don’t
understand the context in which you are asking. You’re saying you haven’t
kept up with the technology, so should you go find someone who has? That
doesn’t seem like a good reason to do anything.
Interviewee: Should I find somebody that is up on the latest technology,
so then I don’t have to waste a year.
Jason: Why? Who cares? Why do you have to make a company on the latest
technology?
Interviewee: Well, I’m talking web development. I haven’t really developed
any web applications. It’s a web app that I want to do.
Jason: So you’ve never done a web app and you want to make a web app
company.
Interviewee: Yeah.
Jason: Then I would get someone else who’s done it. Or, decide that this
is going to take a long time. Which is okay. Is it Okay if this takes a
long time? Or is this a race?
Interviewee: No, there’s no race.
Jason: Oh, well then you can decide. Because you could get someone and
then you go faster or you could say, “No, I want to learn this. There’s no
time pressure so I’ll simply take a long time to build it and who cares.”
Interviewee: Yeah, that makes sense.
Hamid: The other thing to consider is, is it going to be a technology
company? Or are you building a web app to service a non-tech field. And
that’s sort of an interesting thing because if you’re building a web
application that could sort of not be on the latest technologies and have
the greatest whiz-bang UI interfaces, and the greatest user experience; but
you are servicing this market that is way under-served. The one thing that
you might be able to do is outsource the development costs of it. I don’t
know what your investment potential is.
Interviewee: Right.
Hamid: But if you’re trying to build a technology company without having a
technology co-founder, I think that would be a huge problem.
Jason: I agree.
Interviewee: Thanks.
(strum)
Gelie: Hi.
Jason: Hi.
Gelie: All right, so the name of my company is networkingphoenix.com.
Jason: Yeah, and folks who have common interests and want to find each other
in the interest groups that they can go to can find each other on this
centralized location.
Gelie: Very good. I’ll give you an A. So, basically what it is, is it’s a
website, and we compile and promote all the different business networking
events in town on the calendar.
Jason: Right.
Gelie: So the core of the site is the calendar, and the reason people come to
the site is because of the calendar. Then we have different things built
around it. So, when you land on the site and try to click on anything it
will let you view the event once, but then it says “Hey, if you want to see
more events now you’ve got to create a profile”. So, they go to create a
profile, and it’s free. It’s like LinkedIn, right?
Jason: Right?
Gelie: So you create a free profile, you promote your business, whatever you
want to promote, and now you’re in my database. So, we’re three years old.
We’ve got about almost 20,000 members.
Jason: Wow.
Gelie: We are actually one of the most popular local websites here in Arizona.
Jason: Yeah.
Gelie: And four times a year we do these big networking events where we get
about 1,500 to 2,000 people attending.
Jason: Wow. Where do you do that?
Gelie: Resorts here in Phoenix.
Jason: Oh wow. That’s cool.
Gelie: Glad you think it’s cool.
Jason: How much do you charge them to attend one of these events?
Gelie: Well, it’s free.
Jason: No!
Gelie: But no, it’s free for them to attend. Well, it’s not free for the
sponsors and the people that exhibit at these events.
Jason: Well yeah, but man, even if it was $5.
Gelie: Right. Everybody says that. But that’s why nobody has events as big
as ours because everybody gets greedy and wants to charge, right?
Jason: Fair enough.
Gelie: So this is where we’re different.
Jason: But you make some money on the event?
Hamid: I like how she at least answers that question.
Gelie: Oh, I’m sorry.
Hamid: She’s like bam!
Jason: No, no. That’s good.
Hamid: Exactly. She knows her business. It’s very good.
Jason: I mean, you could still have premium members who decide they want to,
just like LinkedIn, right? You pay, you get a little more.
Gelie: Wait, wait, wait, wait. Right. So I was going to say the core of
business…
Jason: But you make money on these events, right? Because of the sponsors,
but you make money on these events, right?
Gelie: Correct. The core of the business though, the revenue model, so it’s
free to join, but then there’s the optional paid membership.
Jason: Right.
Gelie: Right? So it’s $10 a month. You sign up, then the monthly and then we
have an annual, but you can attend other organization’s events for free.
So I negotiate the free tickets and I just become this middle person.
Jason: Right.
Gelie: So you sign up for free, and you get your passport and now you can
attend different chamber mixers and all this other good stuff, different
educational seminars. So in a nutshell-
Jason: How many people do that?
Gelie: Right now we have just over 1,000 and we’ve had the product out for
about a year and a half.
Jason: That’s a long time.
Gelie: It is a long time, and so we’ve been watching the trend, right? So,
when do they sign up? Why do they sign up? Why do they drop off? So,
there’s definitely things we know we need to improve on but we haven’t
been, I haven’t had the data, right? So I didn’t know. Now that I do
know we’re kind of getting into that phase of “Okay, now we have to take
this product and fill in all the different gaps”, right? So why are all
these people falling off? Well the good thing is a lot of them actually
tell us why they’re leaving. So we know we can improve. But, that’s not
really, so my question to you is, So where I am in the business is we want
to expand, right? So we want to take this to different cities and keeping
that local feel. So we’ve got networkingphoenix, networkingsandiego,
networkingwhatever, fill in the city. So we’re kind of trying to put
systemizing everything; but what I’m struggling with is going into year
three because everybody’s been doing their own thing, right? I’m actually
very fortunate because I’ve had the same employees pretty much since day
one.
On one hand that’s good; on the other hand that’s bad, because I don’t
really know what they do on a daily basis. So, we’re trying to systemize
it so I know I have 10 minutes here, so actually, I’m not going to ask you
that question, because I’m more interested in my other question, which is
how do I build a board of advisers? Okay, so this is kind of a few part
question I’m going to ask you and then you can give me your overall thought
process. So I’m looking to build a board of advisers because I kind of
need a sounding board or I feel like i could use a sounding board and then
really why would somebody want to be on my board, right? Because I’ve met
with a few VCs and Angels and I’m not really looking for money as of right
now, but I always just kind of like to bounce ideas off of them and they’re
like “Well, you know, if you’re talking to me, that means, and I’m a VC,
that means I’m going to want to invest and blah, blah, blah” but then they
say “But not everybody would want to invest”. So, Okay. How do I find
these people?
Jason: Well what do you want them to do?
Gelie: I need a sounding board, right? Because I need to be able-
Jason: Well then just find, you’re a network of, you know 20,000 people. I’m
serious. So what you need is to find people like, they’re business-savvy,
they’re interested in this for whatever reason, they also want you to
succeed, they like you personally, and that’s it. Then they’ll be a good
sounding board.
Gelie: Okay. Right. But, I mean, not like how do I approach them, but, yes,
how do I approach them, only because I’ve never been in the situation and I-
Jason: You’re a networker.
Gelie: Listen, I know, but I get it. I can approach a lot of people, but I’m
not going to approach a lot of people.
Hamid: I take cash if you’re…
Jason: Yeah.
Jason: I don’t see what the dillema is. You literally say…
Woman: Why? Why would they want to be in my board? Okay, there’s this “why
would they want to be in my board?” So maybe, you can give me some insight.
Is it because they just want to put their name on something cool, or what?
Hamid: The problem that you’re describing is one that a lot of founders
have. Jason, maybe you can sort of elaborate on this. But I think it’s
difficult to ask people, even if those people would be more than willing to
do it for free or to spend their time making other people successful,
because somebody helped them along the way. But it is difficult to ask, and
that’s one of the things that, as an entrepreneur, you have to sort of get
over the hurdle that you have to get over. But how do you get over sort of,
how do I approach this person?
Gelie: Right.
Jason: To ask, and what are they going to think of me, you know?
Gelie: Right. Yeah. Because there’s a million people that I’m sure will
want to do it…
Jason: Hold on. Hold on.
Gelie: But I don’t want them on the board.
Jason: Right.
Jason: You don’t seem like you have a problem approaching people and
talking to people…
Gelie: I’m shy.
Jason: Or saying whatever you think. Okay. So that’s not the problem.
Gelie: You’re right.
Jason: You’re afraid that that they don’t… Why would they volunteer
their time? What’s in it for them? Is that what you’re worried about?
Gelie: Yes. Yes. Yes.
Jason: Well, Okay. Number one. Who cares? As long as they want to do it,
it’s Okay.
Gelie: Okay.
Jason: Number two. People do it because it is fun for people who are doers
and are intelligent and like thinking about problems to hang out with other
people who are like that and to see those things happen. That is just fun.
That’s life.
Gelie: Right.
Jason: It is fun and life. Imagine how many emails I get asking to pick my
brain about this with that, right? And everyone, of course, the automatic
answer is no because of the time, just time. But every once in a while, I
say yes. And why do I say yes? Because that person just seems like they’d
be interesting and they’re doing something cool, and they seem like they’re
serious, which you obvious are because you got a growing concern and all
that. You just want to. I’ll put it this way. All these organizations and
stuff, where people are obviously at a net loss in time and money for
pretty much any organization in town that you send people to, why are they
doing that? Because they want to hang with people who are interested in
that thing and talk about it. That’s why they’re doing it.
Hamid: One of the things that I’ve done a few years back, a couple of, me
and buddy, who happens to also have a software company, we were talking. We
thought exactly the same thing. It would be great if we could have a sort
of advisory board, and we ended up inviting five other people, that
happened to be from all over the country, that also have software
companies, to a joint meeting in Las Vegas that we were going to spend a
day talking about our businesses. That meeting turned into, now, we’ve been
doing it for five years. Every five, six months, we travel to a city of one
of the companies. It might be Dallas, or Toronto in Canada, or Florida or
Boston, where each of the companies are and we’d become each other’s sort
of sounding boards and advisory boards for a day; and we’d take turns going
around the table. So one way would potentially be a mutually beneficial
thing, rather than just, simply, incoming advice, right? Rather than a
board of advisers that’s just for you, what about a board of peers that you
give them just as much advice as they give you? That sort of worked out
really well for us. So that’s another thing to consider, another way to go.
Jason: Yeah. I agree 100%. I know quite a few people who do that. Usually,
it’s local just because it’s easier, right? You just find other local
entrepreneurs that you can just meet with once a month.
Jason: Well, that’s…
Gelie: But, yeah…
Hamid: It’s hard, often times, local. But even if it’s international, not
international. But even if it’s national, our trips cost about $1000 per
trip. And we do it every three, four, five months. So let’s say three times
a year, I spend $1000 on a trip. So that’s $3000 a year on an amazing sort
of meeting that I couldn’t have locally because those companies don’t exist
locally. I can’t find seven other software companies about my size.
Gelie: Right. Right. And that actually was my point, is that yeah, you’re
right, there are a lot of people, but I don’t want to talk to them.
Hamid: Right.
Woman: Because it’s unsolicited advice and more than anything
Jason: Look. I think what you should do is decide who are the people that
would be perfect for the board…
Gelie: Right. Which was…
Jason: And then just go ask them to be on it, and then when they say yes,
you can ask them, why then? And that would be a…
Hamid: Why are you wanting to do this?
Jason: This is really easy. I don’t
know…
Gelie: But seriously… It’s good for me get some feedback and insight on
it just because, like I said, I don’t know, this is like a new arena and I
typically don’t like to talk to people about my business and details. I
mean, I have certain people I talk to about it, not bringing outsiders in.
So, the few times I did venture into that world, it was kinda of ugly
because maybe I met with some wrong VC’s or whatever.
Jason: I don’t know. You’re just, I don’t know, justifying something? Just
do it already. You said you want a board adviser, so go get one, and if
you’re not comfortable with it, then don’t do it. I mean, just do it, and
then you can ask them why. By they way, I know we’ve got to go, but you got
to charge more than $10 per person, because right now you’re making $10
grand a month off of that and that’s not enough, especially if you want to
spread out to other cities because there’s no… I mean, to what end? So
you can hire one more person. I mean…
Hamid: It’ll turn back on in just..
Jason: That doesn’t make any sense to me.
Gelie: We tried. That’s actually really interesting feedback, and we tried
doing that and it did not work as well as $10. We actually make more money
charging out $10 because more people sign up and stay longer than…
Jason: Okay. Well, that’s fine. But then, in some other way you need to be
making more money, or else, I don’t know why your’e even going to a
location.
Gelie: That’s not the only revenue stream. That’s the core of it, but the
thing is I have 20,000 people to sell to, and I haven’t even had a
marketing program for it. It just runs itself.
Jason: Well, maybe you should do that before you expand to other cities.
Gelie: Absolutely.
Jason: In other words, you haven’t figured out this model, yet, that’s
really cutting off money.
Gelie: Right. Oh, right. So we’re not expanding tomorrow, but in order to
expand, so this is exactly why I’m looking to place people around me, so I
can actually bounce things off other people because I haven’t had that this
whole time, so.
Hamid: Your first step is to systemize everything. And then…
Gelie: Exactly. Right. Which is what I was starting with because we need
to just get this system down.
Jason: More money.
Gelie: Yeah. No, absolutely. I mean, like I said, there hasn’t even been a
marketing program for this passport program.
Jason: All right.
Gelie: All right. I’m taking up to much time.
Hamid: No, you’re…
Gelie: Thank you.
Jason: Thank you.
Patrick: Thanks.
The post Smart Bear Live 7: More from AZ Disruptors appeared first on @ASmartBear.