Fireside Chat with Kevin Henrikson

Kevin Henrikson, Partner Director of Engineering at Microsoft — an exclusive chat with Testlio CEO, Kristel Kruustük.

Interviewer: [00:01] All right. One, two, one, two. It works. Maybe we can turn off the music now. And everyone who is still in the kitchen, please come to this area over here. Join us for the meetup. We’re about to start. Yes. Perfect. Oh my God, I’m so excited. This is like the event of the year for me. Definitely. And I’m so happy that my friend Kevin got to come over to Estonia this year and I’m excited to be sharing his story with you tonight. So thank you so much for coming out. We had so many signups for the events, so thank you for the support than this interest. I am sure that after you leave this event, everyone is going to be super pumped because Kevin is seriously one of the most intense guys that I’ve ever met in my life, and you’re going to shortly be a be seeing him. So Kevin, come over here. Yeah.

Kevin: Also, how are you using that thing? I love it, let me hold it. It’s like a comfort thing, right? You’re like holding something, right?

Interviewer: Oh my God.

Kevin: I’m just kidding.

Interviewer: Come sit down with me.

Kevin: [01:15] Now, I didn’t think I was going to get to come today. I signed up last night and I got this thing, it said I’m on the wait list. I was like, “Oh shit.”

Interviewer: Yeah. I already told Kevin that—

Kevin: Is this recorded?

Interviewer: Yes.

Kevin: Alright. No more cussing.

Interviewer: Yes, so be nice.

Kevin: I know.

Interviewer: It’s serious, it’s going to be a new YouTube forever. So, there’s no way you can take it off, unless you go and work for Youtube at some point. But that’s probably not going to happen because Kevin is definitely an entrepreneur from the heart, right?

Kevin: From the heart.

Interviewer: [01:45] Yeah. So what else can I say about Kevin? I was thinking about how can I start off with this meetup and I was thinking that Kevin truly an awesome guy that has been a big inspiration for me and Marco as the founders of Testlio since the beginning. Seriously. So I don’t know if any of you got to walk around in the office already, but we have two posters up in the office called “what would Kevin do?” And it’s all because of the reasons, because Kevin has been so fast moving his entire career, and for him businesses like a play.

Kevin: Like a game.

Interviewer: Like a game. Yeah, exactly. It’s really, truly like a game, and everything that he does seems to be so easy. So, today I think I would love to dig deeper into your entrepreneurial journey. What inspires you. And then on the second hand, talk a little bit about maybe QA and the way you’ve built the product that you’ve made really successful.

[02:48] And so why Kevin is famous is because he’s one of the earliest employees at Zimbra. Then after Zimbra he went to work for a VC company called Red Point Capital. They’re like $1 billion fund, right? And he was an EIR there. And then from there he continued building another email application called a Acompli, that amazingly got the acquired by Microsoft after 18 months for maybe 200 million. He never confirmed though. And then now he has been a part of Microsoft now for about two years.

Kevin: Two and a half years.

Interviewer: [03:31] Yeah, two and a half years. And that’s it. And one thing, one more thing. What’s very interesting about him is that he grew up in a pig farm. So I think a lot of us can relate to this as well. Like we’ve done a lot of that—

Kevin: is that like a common thing in Estonia, to farm pigs?

Interviewer: [03:50] Our grandparents usually have like farms And lots of animals there. So Kevin has built houses on his own as well.

Kevin: I did none of that. Now let’s be clear. That’s why I did the computer thing, cause it made computers super easy. You’re like wow, just sitting in an office all day. It’s air conditioning, free food and drinks. It’s a pretty good deal.

Interviewer: [04:07] Yeah. But seriously, I just want a purely know like what got you into technology? 

Kevin: [04:15] That’s a good question. You always [inaudible] Like it gives you a chance to think right? Always asks a good question. What I’m actually saying is holy shit, I have no idea. Let me think about it. But if you say that, it’s a great thing. What got me into tech? So I don’t know early on when I was a kid, I don’t know, growing up in like the eighties or nineties my dad bought this computer and it had like two disc drives and we would stick things in it and he put the box there and we couldn’t really use it or open it until we read all the instructions. And so he’d gave us the book and we’d read all the instructions and he’s like, “how are you going to set it up?” And we knew exactly where everything go in cause we’d spent like weeks studying this stupid manual. And then we— because my parents knew nothing about computers really other than like, Hey, some of his other dad friends were like buying them for their kids and it sounded like a good thing that we should learn. And my dad was a pilot, so he didn’t really— He’s like, the plane works on computers, so like maybe you should learn about them.

[05:08] And so then we just learned on and we played games and wrote little programs, back in the day we had to write like little cassette tapes. I wasn’t old enough to do like the punch cards the super old stuff. But we did cassette tapes and yeah, I don’t know. Then from there and then we didn’t have really internet, we had this dial up modem stuff that was really slow. Then when I got to college we had that thing called the internet and we plugged in, you’re like, “Whoa, that’s fast.” And so we started sharing music, right? That was the first thing we did. And then yeah, the internet just kind of obsessed me after that. Yeah. Cause I was going to do a mechanical engineering. My degree is actually mechanical engineering. So I was like, Oh I’m going to go build cars and airplanes cause that stuff’s awesome. And then I got them like this computer stuff’s way easier cause like you’re like, dude, build a car, It’s like five years, then you build this thing and you worked on the door handle, right?

Interviewer: [05:53] So now when you look back, do you still think it’s way easier than building a software?

Kevin: [05:58] Yeah. Like building an airplane. I mean, my brother worked at Boeing for 14 years or something like that. It’s 11 years. But from the time he started until the time he left, he was working on the seven 787, and he was in IT, right? He managed the application monitoring for the software that managed the part, replaced it for the 787 that hadn’t been released. And I’m like, what? And, but if it goes down then they can’t get the part for the plane that hasn’t been released. But yeah, they’re testing them so they still need to get the parts quickly. And he was like, even in the software side of an airplane company and that was still like, they don’t want it to die.

[06:34] Like that just the speed was so slow, where like in the internet, the web world, right? You make a change in JavaScript, reload, script there, right? Okay, and then it works. You’re like, okay, cool. The satisfaction for my personality was just way better. And it’s a little slower in mobile, but not as close or anywhere near like building a car or an arirplane. Like and this is probably a bad joke, but when things were really going bad we’ve done some really bad things with email falling over And emails getting deleted and sitting in front of an audience like this. It was a bunch of teachers at Georgia tech and we had rolled out their email system, and we had this weird bug where if any person touched the recurring event it would delete it for everybody, and this bug went on for months.

[07:17] And so they were all there to basically, the IT people are like, “Hey, you don’t understand how pissed people are.” And we’re like, “Oh yeah, we don’t understand. We’ll fly out to Georgia, we’ll make it all better.” So we went to Atlanta and, we got there and I come to this room— It was like a room like this, and they’d invited to the whole staff, they were all pissed. They’re like, “yeah, the guys that built it are going to be here, come yell at them.” And so we sat there for an hour, and we thought we were just meeting with the IT personally. No, we sat there with the whole teachers and they’re like, “I had this class schedule and it [inaudible] when some kid touched it and deleted it” and you know, so it was super painful.

[07:47] But you think through all that you know, you can fix it. Like it’s solvable, right? We did figure it out and fix it. You have this incredible responsibility cause you know today at Microsoft the pilots that fly the planes for Alaska airlines get their schedules and maintenance requests and incredibly important thing. The hospitals. So like, there is criticality to the what we do, but the ability to both break it and fix it quickly is way easier than it would be if you worked in the physical world or building kind of hardware products and things like that. So I don’t know. So I think software is easier. Like clearly building companies is hard. Like there’s all kinds of challenges to it, but yeah, but the speed at which way you can do it, it’s more fun to do things and make change and see stuff happen versus like sitting there for 11 years and hoping the 787 will finally launch.

[08:36] And in the end it did, it’s a great airplane. I think I rode on one on the way over. But like, and then the thing is like, I don’t even know. What kind of plane did you ride on the last time you flew a plane? Do you like know exactly what kind of— No, you’re like, “Oh, whatever.” I mean, hopefully, you know the email app you’re using. Some people clearly don’t we ask them, “what do you use for email?” I don’t know. I use my phone. “No, no, no. What app do you use?”, “I don’t know, I just use my phone.”, “Is it outlook?”, “I don’t know, IT guy installed it.” Yeah. So, there is some corollary in the software world, but hopefully not.

Interviewer: [09:04] So, after college you graduated UCLA, right?

Kevin: Finally. Yeah. So it was funny cause like my second internship, our last internship, whatever I was getting bored, I was working at this software company that was building software for mechanical engineering. So my job was to go in And actually QA the software. So they’d be like, “Oh here’s a heat transfer model.” And I’d write, do the calculation—

Interviewer:  So that’s where you first did QA?

Kevin: Yeah. I was testing and it sucked, right? Cause it was like super hard, cause you’re like testing and I’m like, “I want to go fix the bugs”, right? And so then how do you find good bugs and fix it. And so yeah, I was doing testing in like literally my first internship. My second internship, I was like, “ah, I don’t want to do an internship.” So I started looking on Craigslist and found this company interviewing for an HTML programmer, cause I thought I’d do HTML. And I went and interviewed and they’d sent me an offer letter and it was like a full time job. And I was like, “Oh, that wasn’t internship.” But they didn’t ask if I graduated. So I didn’t tell them. So I accepted the job, went to work and then three months later I had to go back to school. And so I was like, “okay I gotta go” and I’m managing like the web team a small startup, right? So it grew really fast. It’s like 10 people now under my team. And I was like “I have to go back to college”.

Interviewer: So you were out of college?

Kevin: I was not out. I was like, for summer.

Interviewer: You were still in college but you werre already managing a team.

Kevin: Yeah. You know, just fixe the bugs, make it faster, and they’re like, “well this guy has the answer. So maybe he’ll just be in charge, right?” It’s kind of I always talk when I talked to college students, they’re like, “well how do you promote yourself?” You don’t. People start asking you questions and you know the person in the office if the internet went out right now, there’s probably one or two people we’d call. Like if the internet went out in this office, there’s probably one or two people somewhere sitting in here that’s like “We’re going to go talk to that guy. He’s going to fix the internet.” Right? And if you become that woman or a guy during like your chunk of work, you just kind of become naturally the leader. And whether that’s the manager kind of boss relationship, or the architect or the principal. And it’s kind of just becoming that person.

[10:47] “Oh, I have an HR complaint. Like there’s somebody in here that does HR. You’re like, “Oh, they’re they are.” That’s where you go. And so how do you become that person? That’s how I stumbled into managing people. And then I told them, I’m like, “sorry, I got to go back to school.” And they’re like, “well, you’re managing this team.” Like, “I don’t know, you didn’t ask. I didn’t ask, whatever.” And so I’m like, “Hey, well I can do school two days a week. Why don’t you let me work three days a week?” And they’re like, “All right.” So I did that. So I just worked three days a week, went to school the other two. And then about a year later they came to me and they go, “Hey, I thought you were going to go back to graduate?” And I’m like, “Oh yeah, I did three months four months ago.”

[11:18] And they’re like, “well, you’re going to come back to working full time?” And I was like, “Oh yeah, sure. I can start on Monday” You know, then nobody asked, right? So I was just taking two days off. It was kind of cool. But so I did that. And then of course, you kind of like writing’s on the wall, what happened to that company, right? They went out of business.

Interviewer: [11:34] But seriously, you get this hunger for doing something?

Kevin: I don’t know, I get bored really easy.

Interviewer: Being in college, where is it coming from?

Kevin: [11:47] Yeah, exactly. It’s way easier than feeding pigs. That’s what I’m like, can you imagine like going feeding pigs? No, just going to do cool stuff, right?

Interviewer: So just do whatever you want and you can implement things really quicker. And then what happened after that?

Kevin: [12:00] So, that company went out of business. So like on Friday they’re like, “Hey, company meeting, we’d had tons of layoffs, right?” Like 400, 200, 12, right?

Interviewer: And you were still in the 12?

Kevin: That’s another thing, right? You’re a survivor, right? You’re like, I made it down to 12. And you’re like, you’re the manager, you’re the boss, you’re the janitor. You’re at all the jobs at that point.

Interviewer: How did you feel about this as well?

Kevin: So, it was a good lesson. I’ll tell you about that one after [inaudible] But so yeah, they’re like, “Hey, we’ve got a lunchtime meeting. Everybody come in quick meeting for lunch”, and they have these envelopes. Everybody got an envelope. And the CEO is like, “Hey, this is your last paycheck and we’re going to file for bankruptcy in about three hours. So, go to the bank and cash it right now because after five, you won’t be able to cash it for many weeks cause it’ll be in bankruptcy and you have to go fight for yourself.” I mean, you’ll get it, because salary comes off first and stuff that I learned later. But you know, so we all raced down to the bank bank of Santa Monica in LA, and you know, 12 of us, right? And we were 11 actually, the CEO didn’t come. He kind of bummed at that day, right? and so we were all cashing the checks, about eight of us in there. Like, “we’re out of cash.” Like, “what do you mean you’re out of cash?” They’re like, “well, we just don’t have [inaudible].” He said to cash it. Well, we didn’t have bank accounts there. And so we had to go to two other banks, and then we just went and drank all night, complete debauchery.

[13:15] But yeah, the lesson there is, the way I tell that lesson is, I don’t know in college. But in college in the US they have these kegs a beer keg or whatever, right? And when you have a party some person who’s adults friend or whatever will get a keg for a bunch of underage kids or whatever that shouldn’t be drinking to drink. And they’ll put the keg there and then somebody controls the tap. And so in the US we call that the keg master, whoever’s holding the tap who’s got the button? And, so it’s like everybody drinks out of these red cups these cheap plastic cups, right? So all the cops are like there’s some one person sitting there filling it up. And so, the lesson was like, you gotta be the keg master, right?

[13:51] So the person that controls the resources kind of wins cause you instantly become the friend. Like the next day on campus they’re like, “Hey, I saw you last night” or “I remember you from last night”, cause you’re filling the beers, right? You’re filling other beers. But then the story goes on a little bit farther as it as the party starts to wind down there’s always like a few people lingering out and bad things always happen at the end. You know, the police come, it’s too loud. Like somebody throws up on the floor and we’re like, “dude, that’s a bummer.” Like you’ve got to clean it up. If you would’ve left earlier, so the lesson there is like, don’t be the last one at the party. So when you see a company or you’re in a group you know, this works in big companies and little companies in little companies, “Oh well the smart people are gone. I’m now the boss.” And so I was a kid. I’m like, “This is awesome, dude.” Everybody’s leaving. I’m like in charge. I’m running this whole department, and there’s nobody here, but I’m running it. But the trick was like, Oh wait, all the people that I knew that were awesome that I worked with, they were super happy as my colleagues, they left. And so I was like, “I should have left too.”

[14:46] And so now I’ve seen that in big companies where you’re like in a group, and a huge division, and the division kind of whittles down and you’re like, “well, I’m the boss of the littler division.” But then eventually they’ll either lay everybody off or shut it. You know, it’s never a good sign. So don’t be the last one at the party.

Interviewer: But it was a good lesson.

Kevin: [15:00] Yeah. There’s like 12 of them. I should go through them all one day. That’s a different talk.

Interviewer: It probably hasn’t never happened to after that, right?

Kevin: Got laid off?

Interviewer:  Yeah.

Kevin: Yeah. I actually got fired from VMware. So yeah, I think you knew that. That’s a trick question. So now it’s, I got laid off again.

Interviewer: [inaudible]

Kevin: [15:18] I know, but that one’s a little different. So that one, the angle was a little different. So we had sold Zimbra to Yahoo, and then Yahoo sold it to VMware. And then we’re at VMware and then it had kinda run its life there. It was a startup that was great but just never fit in wherever it landed. And so they were like, “Hey, we’re going to sell it again to like a private equity firm and offload the asset.” Because the nice thing about email is once you— how many of you would like to switch email servers? Like if anybody in IT it sucks. Like, Hey, “let’s switch from Google apps or Microsoft office or from office to to exchange or whatever.” Is super painful. And so you get very wedded to that platform. And so Zimbra had all these customers that were still paying us because it was very hard to switch off of it. It just painful. It’s not worth it. And so they’re like, “Hey, we’re going to sell the business.” And I was like, “No, I’m not going. That’s eight years I’ve been riding this train. There’s going to be no good kind of like having this asset get sold” and so I refused to leave and then they’re like, “you need to go to go.”

[16:13] Too many good ideas, I guess, for them. And so they were like “since you’re not staying, you need to lay your team off and then we’re going to lay you off.” And I was like, “Well, I’m not laying the team off. And so I just left.” Like, they gave me the paperwork and I was like, “I know what that is. I’m not signing it. See you later.”

Interviewer:  But so how did it happen that you became part of Zimbra first off? So that was in 2004 when you started having these conversations joining Zimbra, right?

Kevin: Yeah. To go back.

Interviewer:  does everyone know what Zimbra is?

Kevin: It’s like an email server. It’s like a Linux-based email server that competed against exchange and loss.

Interviewer: And they were sold to?

Kevin: Yahoo.

Interviewer:  For 350 million.

Kevin: 350 million.

Interviewer: And Kevin was one of the first, you were one of the first people there. So how did you get there?

Kevin: [16:51] How did I get there? So [inaudible] who is the VC in Accompli was the CEO of that company, and he had been in a company where I met my wife, who’s somewhere hiding in the audience.

Interviewer: I think she’s there.

Kevin: [17:02] She moved. She’s hiding. She’s definitely embarrassed now. So, I was at this company called open wave. It was like doing software for carriers, and I got there like my first week, this is after I got laid off from my company in LA. I got hired and they paid for me to move to Northern California where my brother was living. And the first thing we did is they said, “Hey—” I was like in a bug fixing group, so it’s kind of like QA, more like the patch groups. So like when the customer would report a problem, they were like, “Hey, the good engineers are too busy to fix bugs. So we have this special group that fix these bugs”, I mean, this is a traditional like enterprise model. And I was like, this is gross. I’ll never run a company like that. But I was like, “Whatever, I’m here, I need a job.” So I took the job and I was the first person on the team. And so we’re sitting in a room 10, 12 people. And one of our big customers at the time was British telecom in London or wherever it is, right? Well actually that office was in Belfast, which was weird cause that’s where our office was, but it was British telecom.

[18:01] And so they’re like, “Hey, we’re having problems.” This is like mobile way back in the day, with these super crappy web WML phones were it’s like HTML, but really, really worse. And it ran on these little phones that were like the worst Android phone minus 10. It was really bad phones, under powered, pixelated screens, it had like T nine, you had to pump the character three times to get every letter. They didn’t even have keyboards, right? And so they’re like, “Hey, there’s lots of bugs on this.” This customer got 14 bugs and they’re super complaining and all the kind of QA people and all the executives in the room, and I’m like sitting in the back, cause I barely could get a chair. I’m like the lowest, lowest, lowest person in the total. I’m the one that when they find the bug, I’ve got to go eventually try to fix it.

[18:51] And they’re like, “Hey, we need somebody to fly out to the customer and fix all these bugs.” I’d been there a week, so I didn’t really know anything, but I’m like, “I’ll do it.” And the gyt was like, “wait, who are you”? And they’re like, “This is this new guy, he just started” and they’re like, “you can fix them?” And I’m like, “Sure, whatever, I can try.” Like I don’t know, that’s my job, to fix bugs. I’ll try. And so, I went down to Barnes and Nobles, bought a book on WML. I didn’t know Jack about it. Read the book on the plain. Long flight, right? 10 hour flight, 11 hours to get to London, read the book. I got there, and they didn’t tell me— this is the awesome thing about Europe, there’s always these holidays, right? And so I get there and it’s a bank holiday. And so I’m like, sweet, this is cool. So the day I’m supposed to do so some work, nobody’s working ,right?

[19:21] So, finally found one of the QA persons and she brought over like a sack of like these shitty phones and handed me the sack of phones and says, “here it is.” And I’m like I’ve got this spreadsheet with all the list of bugs, and so I’m trying to find figure out how it works. Get the thing working and it’s like dial up, CDMA, GSM, Edge, it was before edge. It was like, what is it? Like [inaudible]. The thing would connect, you could feel the phone connecting. It was like [inaudible], and it would connect and the page would start loading. It was just terrible.

[19:47] And so, yeah. And then so that day I sat there in my hotel room for, I don’t know, 12 or 14 hours or whatever. And then I fixed like six of them. And it was all hacks. Like if I see this, do that and just don’t do the bad thing. Like the worst, I mean, just the grossest code you’d ever written. But I got it working. So the next morning they’re like, “how’d you do doing?” I’m like, “well I’ve got a couple fixed” and then “let’s just run through the test and see what happens.” Cause two of them I couldn’t reproduce. So that would have gave me eight out of 12. So we ran through it and eight 12 are fixed. And the guy was like, “Whoa, this guy is magic.”

[20:17] And then they get on the conference call and all the executives, “all right, first day status, what are we going to do? Like what’s the plan for the week” and it’s like, “well, he’s got eight done.” and they’re like, “what?” And then [inaudible] texted me, “Hey, how’d you do it?” And yeah, so that was it. So I learned WML that way. So, that’s how I got to Zimbra. That was a way too long. Sorry. That was a long story. And so because of that, when they started the company, they were like, “we want this guy. I don’t know what it is, but he’ll go figure it out.” And I just tried, right? And I mean, I probably was super lucky. But again, it’s not that hard, right? You keep poking at it and keep trying and I mean, the first 10 times are wrong.

Interviewer: [20:52] Do you seriously think it’s luck?

Kevin: [20:55] It’s not all there is. I mean, you have to be willing to try and not be afraid to fail. I mean, when I got back home and I had all 12 bugs fixed, the engineers literally laughed at me. They’re like, “this guy is the biggest joke. Like he wrote in there if like customers use their address, don’t do this whole path of code.” Fucking worked. I don’t know, you guys figured out, smarties. And so yeah, then I became the manager of that group, and then this is the best part. So these guys all started leaving to go to Zimbra and I was like, “Nah, I’m going to save my stock. I think it’s a good deal.” And I turned him down cause I didn’t really get the startup thing back then. I was like, “ah, this startup thing sounds risky.” My parents were like, “dude, that’s the stupidest thing ever. Don’t go do a startup. They don’t make any money.” I’m sure [inaudible] talk to your significant other or somebody, they’re like, “you’re going to what? Take a pay cut and go to a smaller company and all these other problems?”

[21:51] And so yeah, they came and offered me a job and I was like, “Nah, I’m good. I’m super comfortable here running this team of like, all the smart people are gone. I’m now the boss again.” And so I made the same mistake sort of again. But then about three months later I was like, “No, I’m kidding. I’ll go.” And so I joined a little bit later. So, I would have been even earlier. But I joined a little later. But then I get there and they’re like “well, we’re kind of big now. We’re like 15 people. You gotta be interviewed.” And I’m like, “Okay, I’ll do that. I’ve never interviewed in awhile.” So I started interviewing and the guy calls me, he’s like, “well two people said no.” And I was like, “what? All right, this will be fun”, so they couldn’t hire me.

[22:17] And so I was like, well. So, I was going to be the manager of the web team cause that was kind of my jam at the point. And they’re like, “well we have this job [inaudible].” And I’m like “well, what do they do?” And they’re like, “well, it’s going to be an open source company and we’re going to need to go to like conferences and talk about our product and open source. Make it seem like open source but talk about our product.” “Alright, I’ll do it.” And so I joined

[22:39] And in most companies that’s not as high of a job as managing an engineering team. It’s an awesome job and super important like community manager. And so I turned it into an awesome job. I went to conferences, spoke, built the communities, built this huge forum, thousands of members, all these IT people. It turned into like a massive sales generator cause I cookied the crap out of them, cause I was kind of a hack engineer. So I was shoving cookies in there. Every time people would come to the forums they would track them. And then it would load it into Salesforce. And then so you had like, the sales people would look in and they’re like, “Oh, this prospect.” And then it’s like, they’re like a prolific poster on our forum. They’re like, “we’re going to sell to this person.”

[23:10] And then I did one more little hack. This is fun. So when they would install, we had a free version of our service. When they would install it, they’d have to enter their email address to get the code. They’d enter the email address and we send them the code, but it would also link it back to Salesforce. And so then we would know which service went to which user admin. And then as they added all the users, we’d know how big the customer was, because they’d go in and migrate all their users there. Like, “Oh, they’re using our free product with 30,000 employees. That’s a good one. Let’s go fish after that one.” Versus most IT people would install it, it’s like him and his brother. So it’s like a two-person domain, it’s not interesting to go chase that person down in free software. So and then about six months later, those that said no, I was their boss. So then I was managing the engineering team.

Interviewer: Did you ever feel bad when you were turned down for the job?

Kevin: No. See that’s another good trick. I mean, yeah—

Interviewer: You know why you were turned down for this job?

Kevin: Yeah. They said, “dude, we saw that guy write code, he’s a complete hack, he’s a joker.” Like, and my code has never been good. That’s why I do this and not code anymore. But yeah, because I just solved the problem. I don’t write like, I just don’t have the patients to write it correctly, I guess is part of the problem. But yeah, they were like, “yeah, his Java script sucks. He couldn’t even write code.” I’m like, “well, I hadn’t been writing code for three years, and I was managing you guys.” And then they’re like, “yeah, well you can’t write code. We’re a small company. We need you to write code.” So I was like, “all right, well I’ll wait.” So I joined the thing and became their boss anyways. 

Interviewer: Wow.

Kevin: [24:47] And then they all said— they were like drunk one night in the bar and they’re like—And they admitted, I knew who it was, but they finally like, “Yeah, we were the ones, we said you couldn’t join, and we think you’re cool now and we see why we needed you. It’s like we didn’t know at the time, we thought we were so overwhelmed with work”, they didn’t want to add like a manager cause there was only four of them. They’re like, “We don’t need a manager. We need like a helper to help work.” And so, I think their point was valid at the time, but we worked it out.

Interviewer: Did you ever feel like, “Oh maybe I should become better at writing code and being more precise?”

Kevin: See, that’s one way to think of it. So I took it a different way, though.

Interviewer:  I think people tend to think that, “okay, if I was turned down maybe I should push myself harder into doing something that maybe I’m not that good at.”

Kevin: [25:06] Yeah. So I think of pushing myself harder, but not necessarily to like, I might not necessarily have to go learn to code. I’m like, “well, I’m going to go figure out how to get in there and figure something else out.” So, I get bummed out when people tell me no. Like when we started Acompli, I was playing golf with two of my really good friends and they’re like “An email app, really?” I’m like, “yeah, we’re going to go get some funding next week.” And they’re like, “So, what’s wrong with the one I have on my phone?” I’m like, “no, it’s for the phone.” They’re like, “I know I have a phone. It does email today. I have an iPhone, it’s great.” And I was like, “No, it’s going to be better. It’s got all these cool things”, and they’re— So, to me that was incredibly motivating. I was like, “Yeah, it’s super dumb. Like so dumb we’re going to build it.” And then it was awesome. So like those kinds of things like you just keep them and even to this day I’m like, “Oh it’s so dumb, so dumb.” But it feels really good.

[25:54] So like when people tell you it’s a bad idea I actually find that now perversely more motivating than— Because if you agree with me, I’m like, “Oh, now you’re just being nice or you don’t know what you’re talking about.” But if you’re like challenging me and tell me it’s wrong, I don’t know. My sense is that there’s something there. It’s like when you get into a debate with somebody and you start arguing, if they don’t care, if you’re like, “Hey Kevin, I think I’m going to paint my hair pink.” And I’m like, “all right, whatever. I don’t care.” But if I’m like, “that’s the worst idea. That’s terrible.” Like they care, right? Like you’ve actually incited emotion, then they care, and then when they care, that’s kind of a great way to like have a discussion.

Interviewer: [26:30] That’s true. But seriously, when I think back in founding Testlio Leo, then we went through the Techstars accelerator and they were the first— so the program is about three months and over the first month you meet like 90 different and entrepreneurs and investors. Some of them will talk a lot good about your company, then the others are like, “you should just dump this idea. It doesn’t get you anywhere.” And for me it was super hard, and then I cried almost every night and then Margot had to support me and say like “everything is going to be fine. We’re going to get through this.” But it was definitely—

Kevin: And now look at it, t’s like a party in here. It is awesome. It’s like getting into my own event. It’s cool.

Interviewer: Yeah, it’s pretty crazy, because for me it was totally different in terms of like thinking about finding the companies and finding motivation when someone doesn’t believe in you. But then at some point you think that, okay, you need to have like a, you need to focus on the people that we are going to use your product and get their feedback, because their feedback is the one that—

Kevin: [27:32] Again, everybody motivates differently. I have friends that are like these marathon runners and they just go out and when they’re like get beat down, they’re like, “I’m just going to go run.” And I was like, “dude, that sounds painful.” But that’s what they so everybody has their jam and what makes them them, in terms of how you figure out and deal with the feeback. But I think all entrepreneurs figure out that struggle, right? And some people have this great externality of like, “Oh, we’re super extroverted and everything’s awesome.” It’s like, no dude, most things suck. This is hard, that’s hard, you know? But how you deal with that and how do you expose it, and who do you open up to? And I think everybody has people like mentors that you talk to, or like people that you confide in where you’re like, “Hey, this is painful and this is not good”, right?

Interviewer: [28:11] Have you always had mentors while you were building out your career and then when you became an entrepreneur?

Kevin: [28:17] Yeah, I don’t think I was smart enough to know that there were mentors, honestly. You know, I wouldn’t say, “Oh, I go to this person, they’re a mentor.” It’s like, “Oh, I’m just drinking beer with them and telling my stories.” And they’re like, “Oh yeah whatever.” And then they’re giving you tips and you’re like “Oh, I didn’t think of it that way.” Like you’re having a conversation or like I talked to my dad and everything is not good enough. He’s like a super pro of like, “Oh, that’s good. You got 10? I think you should’ve got 12.” Like “Oh 200 million. Is that all?” Yeah. So then I started to manage expectations where I’m like, “Oh I got 12.” He’s like, “Oh is that all?” I’m like, “Just kidding, I got 15.”

[28:52] So then you’re like, you can kind of play the game backwards. But you learn from all of those experiences and how you use— and I think today, I don’t know, my ego’s a little lower and so I can go back and think of like— Because part of it is you’re like, “Oh I know everything or whatever. I don’t need mentors.” But these people are actually mentors to you, and you know, I learned a ton from you guys, right? That’s why whenever I’m with Marco and Chris, I’m always asking like, “Hey, how’s this working out?” And partly, I’m just super, super curious of the game of startups and everyone’s different “how do you hire this? or why did you do this? or if this office is pimped why did you do this?” like whatever, every little thing, those are just tips that you can learn. Like I was telling Mark, those tables did he build it did his buddy build it? like super pimp design really cool. And I was like we went to Ikea and we just built them out. And then we had some funky industrial stuff that my contractor build. Well, we didn’t think that about it. And one of our earlier startup kind of rent spaces, they had a vibe manager and I’m like, “A what?” “a vibe man. It like manages the vibe.” So this guy Jason was incredible at like throwing parties and knowing not just load the fridge with beer, load the fridge with beer that beer people know is good beer.

[30:05] Like all these little things. It’s kind of like when you’re really good at throwing a party my wife’s always like, “Oh, don’t do that. Don’t have trash cans out.” And I was like, “what? Like come on trash cans, they can put trash cans.” She’s like, “No, because if you have servers at the party, you want the servers to manage it so that they’re taking the trash, you want it to be invisible. You don’t want it to seem like there’s trash everywhere.” And so, little things like that that some people notice. And so I think those are all like just great like mentor type pro tips that you can pick up, and you can learn from everybody. I have another friend that whenever he’s over, he’s always like, “Hey, I want to learn something today.” And he’ll start asking questions. And it’s like, he’s super explicit about saying, “I want to learn something today.” And so he’ll either bring a challenge or say, “Hey, I want your input on this.” And knowing that you may or may not have not have the answer he wants or he wants to hear, but he feels that he can learn from that and pick up from that. And I think it’s a trait that I think is entrepreneurs that are successful end up finding that somewhere, whether they’re explicit about that, but constantly learning and evolving. Because every situation is different. And you know, I’ve managed all kinds of size teams, small and large and been in super complex discussions and super fun discussions. But all of those, how you approach it and how you kind of like swing the vibe and where you think things are going to go is, is really important. So, it’s the little things that you kind of pick up along the way.

Interviewer: [31:19] Building companies is truly tough because you’re dealing with people and emotions. So yeah. I’m going to talk more about this I have more questions about this. So, but my last question about Zimbra. So, when exactly did you leave?

Kevin: [31:39] So, Zimbra got bought by Yahoo, and Yahoo sold it to VMware, and then VMware laid me off, or fired me, whatever. It was officially a layoff, but they essentially fired me. Like, you don’t lay off people that are that senior, you kind of fire them. But they said it nicely. And then I left and then I went to join red point as an EIR. And so that was in, I don’t know, whatever—

Interviewer: And so how was the transition from Zimbra to VMware, when you were acquired by  VMware.

Kevin: [32:03] Yeah, every acquisition was different. I think the biggest lesson that we did correct with Accompli into Microsoft that we’ve— I personally was a disaster at, bringing Zimbra into Yahoo and then Zimbra again into VMware as we went in like, “I am entrepreneur, I am startup guy. You bought us. So we’re going to tell you how to do things and we know how our business works.” And so I was super, super overconfident in what we did and kind of like, “Oh you’re just this big business. Like you must be wrong. Cause you had to pay money to buy us to be here.” And we did this thing called the 300 move out. I don’t know if you’ve ever seen the movie like the gladiator 300, where they all put the shields and all the arrows come in and they’re like, they basically win by just guarding themselves and circling and not engaging with anybody, so that was our move.

[32:49] So, anytime a person from Yahoo or a VM would roll in, we’d all just be like, yep. And just like ignore them, block them out, decline the meeting, whatever it was we didn’t engage, cause we’re like, “we got this, we’re the startup people”. And in both cases, in Yahoo we got lucky in the sense that Yahoo was more of a disaster than we were, surprisingly, and still made it another six years after that, which is shocking, and still somehow alive. Like, I still use it to test my Internet’s working Yahoo. But so they sold us to VMware and then we got into VMware, and VMware was very successful and they have this multibillion dollar flywheel called vSphere that would just print money. And so we were this little turd of a startup that made like, our 50 million bucks was nothing to them. And so it didn’t make sense to sales, we never engaged. And that was a super negative experience in that integration. And we thought that was fine, but you know, in both cases, Yahoo essentially kicked us out, we got sold. So, it was like a soft landing into VMware. But then VMware just disabled us. And so all the people that worked for us, my team everyone, my friends, they all either got laid off or shoved into crappy jobs because we did a bad job making friends and well integrating.

[34:03] And we went so far we would fight for crazy stuff. We would say, “Oh, we’re at Zimbra. We”re not taking VMware business cards. We need to print new ones that say Zimbra on them. We’re not taking business cards.” They’re like, “we ordered them”, “throw them all the way.” And so we made them print all new business cards for us, and they did it like, it’s crazy, right? Like what they’ll do. And so you think you’re winning, but it was a complete bad move because then they’re like, “Oh, it’s the Zimbra guy with his stupid Zimbra card and their Zimbra email.”

[34:34] When we went into Microsoft, we deleted our Accompli accounts. We were like, “we’re Microsoft people.” You know, completely dissolved our identity as a startup and said, “No, we’re Microsoft. We’re outlook. This is our thing.” And have tons of friends up and down the org. Like we’ve had incredible retention on the team. Like everybody is still there minus a couple people. But I think basically the team is whole, and we’re well-integrated, and the 19 people that we came in with is now 120, 150 It’ll be this year, we just added a bunch. So I mean, it’s a huge team that we’ve grown around it, and we have tons of friends all through the org on every different level, from support to engineering services, to executive marketing. Because we’re friendly and we come up and meet people. I fly to Seattle a ton, I travel a ton.

[35:18] But completely like, not that I don’t have an ego anymore and think that I’m still awesome, but did it in a way where I’m trying to be helpful instead of coming in and saying “I have the answer, let me tell you about it.” It’s like, “Hey, I’m here to learn.” It’s all a small question tell me what are your problems? How can I help?

Interviewer: you probably got this from [inaudiable].

Kevin: [inaudible] is a pro, for sure.

Interviewer: [35:39]  He’s always like one of the key videos that I most remember is one of the [inaudible] that, don’t be know it all, be learn it all. Maybe he has inspired you.

Kevin: [35:48] He’s inspired me for sure. He’s a super, super inspiring dude. But this notion of like, is incredibly alarming. And so like when I meet with people now, I’m always like, “how can I help?” And it’s like the easiest throw away question, but it’s incredibly disarming for the other person. Even if it’s like you’re meeting them for the first time, or you come in and somebody’s like, “I need a one on one with you”, and you’re like, “Aw, shit, this is going to suck.” Right? And then you’re just like, “how can I help?” And then they’re like, they’re all pissed about something. But then they’re like, “wait, I wanted to tell you that I’m pissed.” And then I’m like, “No, I want to help.”

[36:16] But if they just tell me that they’re pissed, it completely changes the conversation. Or you go to somebody who’s like I’ll get lots of external companies or vendors that want to meet with me. “Hey, I’d love to get a meeting and get 10 minutes your time.” “Yeah, no problem. How can I help?” And then they’re like, they’re all ready to convince me of something. And I’m like, “No. How can I help you? I’m just ready to help you.” And then, it’s a pro. That’s my kind of opener now when I meet new people, is how can I help? It kind of works for me.

Interviewer: [36:41] Nice. I think it’s something that we should all adapt at some level.

Kevin: [36:45] Easy way to learn.

Interviewer: Yeah, exactly. So, now let’s go to the story of Acompi, because I think that’s the most compelling and most exciting, to talk about the way you build the product, how fast you released the product and how did you end up selling it for about 200 billion. That’s what the press was saying.

Kevin: They’re mostly right.

Interviewer: So, let’s talk about that. You were in an EIR entrepreneur residence for a VC company and then you got together with your guys who built Zimbra, and you decided to build this company. Why this idea and why these founders?

Kevin: [37:22] Yeah, nd it’s super random. Like not random, I guess. I’d been doing email for a long time and I was like, “I’m definitely not doing an email company, I’m going to do something different.” And I was having a chat with Sateesh, the venture guy that funded us initially, and I would Dropbox, I had just bought this company called mailbox. It was like this big wait list, and they had this really cool video where like this girl is walking into the world and she’s like swiping her emails away. Like, “Oh, email’s so awesome.” Then like slips her email in a pocket. And I was like, “Oh, I’m back on my hike” and then they’d bought them for like 80 million or something and ended up getting a lot less, I think one of the things shook out, but they got acquired, but they’d only built for Gmail. And I was like, “that’s weird”, because we at Zimbra knew the question that if you build email and you’re trying to beat Gmail Gmail is a free product. Like winning against a free product is not fun. And then exchange was actually where all the money was. All of the people that pay lots of money for email run Microsoft.

[38:13] And so we’re like, “well, why don’t they just take the mailbox thing but build that for Microsoft and Gmail so it works for both. Cause I have a Gmail account personally, but everywhere I work including red point runs on exchange?” And [inaudible] is like, “you guys can build that?” I’m like, “yeah, we can build that.” And he’s like, “alright, why don’t you guys come to a partner meeting on Monday and pitch it”, “okay.” And so then we went and build a quick demo, I hired some oDesk people, banged out some shitty Java script in a UI and had some random UI designer build a little app that looked like a mail thing and put some cool swipes in it. It was all JavaScript, super janky, but it worked. And Javier wrote a server that talked to the exchange server and we went in, demoed. Basically, “Hey, we have an app that talks to your exchange server and here’s what we’re going to build.” And then we had nine slides that walked through a me, Javier, JJ, the three founders, the vision we’re going to go build this email thing and make it talk to both and we need 5 million bucks to do it. And they said yes.

Interviewer: [39:05] What was their biggest concern? Did they have any concerns at this point when you were pitching the idea and you had built an app for the weekend pretty much with people from Upwork, which is—

Kevin: [39:15] Yeah. Odesk is UpWork, exactly. I mean, I think— This is hard to remember. Like you think all you think is awesome. Like, we got the 5 million and I forgot all the questions.

Interviewer: You got 5 million?

Kevin: They gave us five, then we raised a couple more after that. I think the questions were around chat monetization. Because there was like 50 other email apps out there and none of them made money. They were all like one and two person chat and relatively small, and they mostly worked on Gmail and nobody really paid for it. And so the best model we came up with was like, there’s all these companies that pay for Blackberry or good, which was like these two enterprise email technologies. And they paint a lots of money for like super, super enterprisey people to have a like super secure email if you’re in finance or medical. And so we’re like, those are both like four or $500 million businesses, so growing to a billion, we’re like, we think we can go take a penny off that or whatever and get our 100 million off that. Ad they’re like, “I don’t know”.

[400:10] And so, that was probably the biggest question. And then one of the venture capitalists that didn’t invest that we talked to actually said, “ah, well why wouldn’t Microsoft just build that?” And we’re like, “I don’t know. We didn’t really think about it” but maybe they— I think the big reason is they, it’s sort of as we figured out, they make so much money on the server and they’re so successful that it was kind of distracting and hard for them to go build a pure play client that worked on a phone that they didn’t own, right? So the windows phone was awesome and they were so dedicated to windows phone for so many years, their email experience on windows phone was awesome, and they sort of almost by— They didn’t bring office, they didn’t bring any of their apps to iPhone and Android cause they were like, “Oh, those are going to fail, windows phone’s going to be successful.” But then get to that point and now Nokia’s failed, windows phones failed. I guess we can say that clearly now without getting in trouble. Like, I work there. Yes, I can say that.

[41:03] So, the two dominant platforms where Google and Apple and they didn’t have a solution there, right? And so yeah, we said, “Hey, let’s go build it.” So we built it on iPhone. And it was for stuff that we wanted to something I wanted to use myself like we said “okay, let’s do it.” And we did it. So we have a raised the money and then— You have more questions or I should just tell the whole story?

Interviewer: Tell the story. Yeah, just tell the story.

Kevin: I can keep talking.

Interviewer: I know, I know.

Kevin: I feel like we should be serving beer as an intermission.

Interviewer: [41:32] And it’s very easy with Kevin because I never like, I don’t have to ask too many questions, you just like talk and you have so many—

Kevin: Go tell my wife that [inaudible]. Too many answers, too many solutions. No, she’s awesome. so yeah, so we basically hired a bunch of our friends that did email and Javier kept saying, “dude, no more Zimbras” like the Zimbra people. He’s like, “no more Zimbras.” And we’re like, “No, these guys know email, this is our crew, we know how to do it.” And so we hired a lot of Zimbras, so people that had done email before. And then we hired a lot of new people cause Zimbra didn’t know anything about clients. It was not a mobile company, it was a web 2.0, Java script is the future web-based email, Linux and all this kind of— That was the fancy stuff back in early 2000’s

[42:18] And so we had to hire some really good iOS and Android developers, which we did. And then we ran into—

Interviewer: How did you know that they were good?

Kevin: It was hard. So we had to ask a lot of questions. I interviewed about 150 iOS developers to hire three, and two of the ones that we hired knew each other. So, on the Android side, probably about 90 developers interviewed. And that’s like getting through the recruiter, we had our own recruiter, and so she would get through the first thing and then I would like get them on a phone screen. So most of those were phone screens. We probably interviewed in person, in the office, 20.

Interviewer: [42:57] Yeah, hiring is super tough. Like there’s a story from one of our investors portfolio companies. They hired a Stanford graduate out of school and made an offer a very high offer. I think they offered the engineer like 120 out of college on the first year. And then this guy doesn’t show up for the first day, and they just call him and say like, “Hey dude, what’s up? Like, why didn’t you show up for work? It’s your first day.” And this guy was like, “Hey, I got another offer. I’m at this other company.” That’s how it is in Silicon Valley, it’s very competitive. That’s why I’m asking like how was it?

Kevin: [43:31] It’s crazy. So our trick, we were super selective at some level. So I think why we ran, we had tons of great people and two of our best engineers never went to college, got a high school, self-taught. And so like I’m all about fancy schools. I didn’t really go to one, But it was, I went to an ok school, somebody listening probably would be like, “Oh, [inaudible].” So, we said like, “Hey, are you interested in the work?” And so we would give this project out and test them. And you kinda got the vibe of how hard you work. And then we would ask, my cofounder JJ is probably the one to thank cause he was the one that flushed the most people and he would ask them an incredibly simple problem. Well, what he thought. Was like basically implement, [inaudible]. So, basically implement [inaudible]. I’m looking at that thing cause I’m thinking like imagining it, writing on the whiteboard, and then even to this day, if you asked me the problem, I could not get the problem right, and I know what exactly the question is. And I’ve probably given this interview, I don’t know a hundred times. But I’m just not that good at programming, so I don’t know.

[44:33] But yeah, so he was implement stir stir, which is like a basic C function in coding and it’s like eight lines, and then it’s a recursive way to do it. And then we’d say implement it with a star pattern. And most programmers today that claimed to be programmers can’t do like really, really low just a basic like hard program. Cause they’re so common of copying paste code, or like looking on server fault, that was the way I coded, by the way. So I’m like beating myself. Yeah, well we called them black box coders. Like you’re not actually sure how it works, you just keep hammering code at it. Refresh, recompile, refresh, recompile, refresh, “Oh, I got it working up”, don’t touch it. “There’s all kinds of bugs.” Ah, refresh recovery.

[45:13] So, they just stumble through their careers. And so JJ was really hardcore about like, “and we’re like dude, that’s such a weird problem”, and then he had another one that was like resource management where he would manage work into a queue. And again, I can’t even explain it. I’m not that smart. But he would look and he was like, “Oh, just do this and it’s recursive and then you do this thing and what’s the big O notation?” I’m like, “I’m not a CS person, I don’t know Jack about this thing.” And so then, he would ask very simple coding questions that would drive look for incredible raw engineering coding talent. And then for the UI people, the question that I always ask is how would you, and again, I could not do this myself, so I feel a little unfair asking the question, “how do you get 60 frames per second scrolling in a list, an infinitely long list on an iPhone”.

[45:58] So, it’s really hard to get like super fast scrolling on a long list because you have to reuse the cells, I guess, to maintain memory and reuse CPU. Again, I know enough to be dangerous, not enough to build it. But it was good enough to basically, if the person didn’t say reuse cells and manage memory and limit CPU usage, I knew they were not on the right track. And I’m like, “Oh, thanks. Not the right answer.” Right? And I’d release them. But yeah, so we had a couple standard questions that we’d ask, but looking for raw engineering talent, and then just cool people, we’d get them on the phone, right? “Do we like them?”

[46:28] And we had a one guy come in for a dev ops position and you know, incredible guy, programming had all of the skills, and he was going to move out from Colorado. And he’s like, he leans back in his chair at the end of it and he’s like, “I’ve got a six inch rule.” We’re like, “okay?” He’s like, “if there’s ever six inches of snow in Colorado, I need a few days off.” And we’re like, “dude, really?” And we’re like, “you’re the dev ops guy.” And I’m like, “that’s just not going to work. We need you to be on site to keep the servers running and stuff.” And then I’ll give you one more. We had a couple of really good stories.

[47:01] We were interviewing an Android guy and we’re like, “Oh, let’s pull out your phone.” And we were always like, “Hey, show us a couple of your favorite apps.” Like, just talk me through mobile, you know? he pulls out an iPhone and he’s like— We say, “you’re Android, right?” “Yeah, yeah.” He’s like, “Oh, I build games for people and I don’t play them.” Not the right kind of dude, right? And it’s like, you had folks that just didn’t get it, right? And so they might’ve incredibly smart but just didn’t have the right vibe for what we were trying to build. And we wanted people that were passionate about their craft and really enjoyed what they were doing for doing it. Not just like, “Hey, I’m doing it for a job cause I need to correct the bug.” So yeah, so you know, we made a couple of bad hires but not too many.

Interviewer: [47:45] How fast did you realized they were not the right hires for the team?

Kevin: [47:50] Weeks, usually. Yeah. Within a few weeks like you could tell, and then you give them a chance to work it out. One decided to leave to go pursue another type of career completely out of tech. One was giving us too much good advice, telling us how to reorganize our company in stock. We’re like, “dude, just work the code, we’re busy.” And then another one had problems showing up to work.

Interviewer: Wow. Impressive.

Kevin: And then they didn’t show up. They’d sit like by themselves and you’re like, dude, it’s like a family that’s like 12 of us. The office isn’t that big. Like it was like this. It’s like we’re all sitting there like, can you— [inaudible]

Interviewer: And so you got your team together and you started building this product called Acompli, and what’s one of the coolest things about Acompli is that immediately when they started launching, you had a beta launch. Beta, that’s how you pronounce it in America. You started releasing on a weekly basis, whatever it takes.

Kevin: [48:53] We started releasing every couple of days. Started like, initially. And then we’re like, that’s pretty good. And like, that feels kind of weak. Everybody in agile says you have to do a two week sprint sort of. Oh, we’re doing, I get fired up JIRA and I’m all excited. Built the two week sprint. And then I’m like, “nobody’s doing Jack shit for like eight days.” And I was like, “nobody’s checking.” And the last Thursday before the [inaudible] all the code comes in. And I was like, dude. And week after week, every two weeks I’d see this, the second Thursday all the code would come in and then Friday we’d furiously try to sort it out. And we’re like, let’s try one week sprints. And then sure enough all the code would come in on Thursdays. And so we at least would get code every Thursday. And so we kind of rolled with that, and now it’s a little more smooth.

Interviewer: [49:32] But did you get there? I’m thinking for us with Marco as first time founders was, it was very hard in the beginning to set goals for the entire team and for us, right?  There were so many like excuses for example, coming up, “Hey, we can’t do this because we’re blocked by this.” Like, how did you get over that then you said like, “no matter what they want a weekly release and that’s it.”

Kevin: [49:56] Yeah, that was it. And it was, there are a lot of yelling and tears and stuff. I mean clearly it wasn’t like— No, I don’t think so. I’ve definitely had some days I was so pissed at Javier, I remember screaming at him so mad I started to cry.

Interviewer: Was it Javier’s idea to have a weekly release no matter what? 

Kevin: [50:12] I don’t know. We kind of said it was shipping on Friday and we’re not going home until we shipped it. That’s kind of how it was.

Interviewer: And Friday is the end of the week.

Kevin: [50:20] Friday is the end of the week. That’s the same in Estonia, right? Just teasing. So, we did this in Friday and then we’re like, everybody would switch from testing the dev app to the staging app and test Saturday and Sunday. And we’d sit there and we’d have like a party like that, we’d sit around the table with beers and like everybody tests the apps and email reply, “Oh shit. Replies are not working” and that kind of thing. And then as we got a little bigger, we’re like, “this is not going to scale.” So I started looking for QA vendors and this is where you’ll get to come into the story, right? QA vendor.

Interviewer: Really?

Kevin: [50:52] I know. And then so yeah. So then we started looking for QA folks. So we would do this weekly testing, then we’d ship on Monday, and then on Monday we’re like, “well, what happens if you found a bug?” And we’re like, “well, we need to fix it. You have four hours to fix it” because we’d ship it roughly at noon yet, you come in at eight and you’d have four hours to fix it, or revert whatever you did last week to unfix it, right? Because when you only worked for four days, how could you ruin the whole build and not be able to fix it in four hours? And so, that’s kind of how the model, then we would just keep saying that like, “look, you broke it, fix it.” And the other thing was that we knew that what we shipped last week was working. So like if we find some new bug we’re like, “was it there last week?” “Yeah”, people didn’t complain so keep going, right? And so that gave us that model that it was an incredibly freeing thing.

[51:35] And then we said, “Hey, how can I get some help?” And we’d spun up a team in India. And so I had two different companies, and my buddy [inaudible] running the office in India spun up two like local— we call them body shops, where you just like apply bodies to a job, to go and do some testing and bang on these apps. And then at the same time, Kyle, who was the CEO of [inaudible] was wearing a testlio sweatshirt or a shirt. I can’t remember if it was the sweatshirt or shirt, you guys were probably still cheaper at that time, it’s probably a t-shirt and not as sweatshirt.

Interviewer:  It was a t-shirt, yeah.

Kevin: [52:06] Now they’re upgraded. They got all the line gear and like, it’s all super awesome. But yeah, so I think the lines weren’t even around then. So, he had a T- shirt on and my co founder saw it and he’s like, “Testlio, is that like a testing thing?” Henrikson’s up there yelling at this testing company and they’re like, “yeah, it’s awesome. Crystal’s awesome. I met her at Techstars” and we’re like, “all right, I’ll call them.” And so they were pretty new, and we called them and said, Hey, I need you guys to do some testing and I’ll pay you almost nothing cause that’s what I’m paying these guys in India. I paid them way more than nothing. Not probably more than Michelle’s [inaudible]

[52:43] But, so they like— I was like, Hey, let’s just— And so I would bake them off against each other. So every week we’d give them the build and I had told the other guys like, “Hey find me your best bugs, you find me your best bugs.” And they all just would be like, “Well no, we need to know the app and instructions.” And I was like, “I don’t know, it’s an email app. Go figure out how to use it. If you don’t know how to email fire your testers. They’re not smart.” And that was literally what I would tell them. And they’re like, “No, no, we need the test plan.” And I was like, “you’re right, then write one, you write a test plan.” And they’re like, “well what do we have to write?” And I was like, “alright”.

[53:09] So whatever. And Teslio was like, “yeah, that’s awesome. No problem. We’ll write the test plan.” They’re like super hungry, right? “We’ll bang it out, we’ll do whatever, test whatever.” And, and then like the next week a different set of testers ran, they were rotating through like, cause they’re trying this model. And I realized that the same testers that they were having, dude, these guys are awesome—

Interviewer: Yeah, there’s fireworks ordered for you [inaudible]

Kevin: —[inaudible] now I feel famous. So the model, they were using the same two testers at this body shop every week testing and they were finding like the same kind of bugs. Like, “Oh, I found this thing.” And then they would find the same bug like 40 different times. Like, “Oh, I put in this character and it doesn’t work. And I put in this character and it doesn’t work”, I’m like, “dude, I know if you put in special characters in the subject field the app will crash.” And the dude had listed out like 70 bugs, god, every character they could find, emojis. And you know, I was like, “dude, this is terrible.” And then Testlio was being much more creative in finding bugs, like “hit the button 30 times and it crashed.” I was like, “Oh, that’s a good one. I’ll give you credit for that.” And then they got a little hooked on that one, because then they’re like, “Oh, we found another place in settings. If we drill the button we can crash it.” And I was like, “all right, chill out on the settings. If it’s in the main app that counts. Not in the settings part.”

[54:25] And so then pretty quickly Testlio rose to like, hey they get it, right? And I never had to write test plans. And Javier is like, “well, who’s writing the test plans?”, “Oh they’re writing them.” And he’s like, “well what’d you tell him?” I’m like, “well I told them it’s email. Go figure it out.” And he was like, “really?” And I was like, “yeah.” So, I kind of just stumbled my way into it, and it was awesome. And then I was like, “Hey, I need this to do this kind of testing.” And I’m like, “Hey, can you actually make it so every week that reply email works, cause that’s a really crappy regression when we ship our betas and we’re not getting reply email. People want that feature to work.” And they’re like “all right, no problem.” And so then we kind of split it up so they would run like what? 30% of something of the testing was what we called the smoke test, which is the test that I would get if— I would get fired if any of these 10 things broke, reply, forward, create event, launch app, login. So they would test the smoke test and the rest was this exploratory testing where I’m like, “just break it, bang on the app and rotate people through.” So every week if we get a new tester that’s awesome because that’s like the app store, right? And so now it’s my rap like “exploratory testing is awesome because it’s like the app store, you don’t get to pick your users just like we don’t get to pick our testers and they don’t get bug blind.”

[55:26] And then over time we’ve refined it. Like there was this report that I was building, I think this is now I’m fast forward into Microsoft, but there was this report I was building and one of the PM’s made this big power point of all the stats. And I sent it to, I don’t know, Mark or something. I’m like, “Hey, can you guys go build this every week? Like, just take this report.” And they’re like, “Ah, yeah, it’s not really what we do.” And so then we came up with this analytics thing and so like, how did we do stats on the thing? And like, they’re producing, read the reviews and find the bugs. And so you guys were the most flexible in terms of figuring out whatever—

Interviewer: You were really hungry for the business? 

Kevin: Yeah, but it worked.

Interviewer: [55:58] I think the good thing was that we were really competing with another company as well and we’re like, “whatever it takes, we’re just going to do it.”

Kevin: I mean, I’m sure some days you thought I was insane, right? Because for 40 bucks [inaudible] the Jera thing’s not working again. And then [inaudible] it was kind of embarrassing. I tried to [inaudible]

Interviewer: Acompli was actually one of our first subscription customers.

Kevin: [56:18] I always tell this story that we were the first, but like you should probably correct my data.

Interviewer: No, it is. You were the first. And that was actually a turning point for Testlio as well, because that’s where we realized how can we build a subscription business instead of just doing on and off contracts with different customers. And so Kevin was always like super pushing us to the next level and thinking about testing on a higher level, not just like doing like running the test plans but just thinking about QA in a higher level in terms of like, okay, if we think about the user feedback let’s pull in the reviews from the app store in play store and see how the users actually think so we can get more data when we do our testing, because we were on a fast train and we were always on the train, not behind the train.

Kevin: [57:05] Yeah, don’t want to be ran over by the train, don’t want to be in front of the train. It’s a dark spot.

Interviewer: Is like, no matter what.

Kevin: [57:11] Yeah. So it was cool. And I just kept throwing out requirements and you guys always did it and it was awesome. My whole thing was like, I’m like, I need to maybe read like Tim Ferriss this four hour work week, like work never kind of thing. Like I love that shit. And so like, I’m like all about like productivity hacks. Like, how can I not do my emails or how can I not do this? Or how do I get those kind of tricks? And like, so I always think about, when I get a job it’s like, how can I get somebody else to help me? I think I used to say, “how do I get somebody else to do it”, but now I say how do I get somebody to help me? And so Testlio was helping me with quality, so I was like, and I would just say, “Oh, customer found a bug” and I would just forward it to Marco. You get like an email coming in from a customer and I’m like, “I don’t know, you guys can find this bug.” And it was great. And then you kind of turned in the quality as a service, right? Where it’s like, Hey, the whole quality, not just like kind of banging through a bunch of steps like robots, right? But actually thinking of quality as a solution and saying, “look people are complaining in the app store”, “we’re seeing this kind of feature requests and user voice.” Like, how do you organize all that into like a single kind of thoughtful plan? Yeah and it worked out pretty good.

Interviewer: [58:12] And so for this entire one and a half years you were on this fast moving train releasing on a weekly basis no matter what. Which I think is so impressive, because I still see so many companies out there saying, “Oh we can’t do this, we can’t do that because we can’t release it this time because we have this thing blocking us” and you did it no matter what, and I’m just trying to understand like, where did it come from?

Kevin: [58:36] I just realized that it works. Because it was incredibly powerful. Again, I’m not smart, right? Think about it, I’m not a good developer. And so like I have to come in on Monday and the app is broken, Testlio found a bug or a user, the app is broken and I’m like, I need to ship it on Monday. And I’m like, “how can I convince the developers to fix it in four hours?” And like having only a week of work? I’m like, well you fixed it and broke it in a week, you have four hours, either take it off or put it on, fix it or go backwards. And that became an incredibly powerful way to have that conversation. And so that became like that’s all I have to ask for, just shit every week. And then once we started to get in that mode, developers started to self-censor their work. So, if you had a really risky thing coming in and you’re like, “Oh, it’s sort of Jake” like in the traditional enterprise world you’re like, “check it in, let QA find the bugs and I’ll sit back and drink a beer and wait for the code to come back.” But that doesn’t work when you ship it on Monday and you’re like, now your Monday is screwed because you shipped crappy code. And so what the magic of that trick was you would say, “Hey, look, There is a little questionable code.” You’re like, “Oh, wait a week”, and you’re only waiting a week. You’re not like waiting a month or six weeks or whatever your traditional cycle is. You’re only waiting a week, it’s fine. And then you fix it.

[59:52] And so then if you’re really confident and you think it’s good, then you’ll push it in. And that works today even at the scale right now with a hundred people, you see it all the time. Like—

Interviewer: And a hundred million downloads, as well.

Kevin: Yeah, that’s just on Android too.

Interviewer:  And that’s on Android. Yeah.

Kevin: Doubled it up for iOS.

Interviewer: [inaudible] a hundred million users on Android, which is like seriously, bravo.

Kevin: [01:00:12] A lot of people. But now it works, and even at scale that we’re now, a hundred plus developers where they’re like, “Oh, I don’t know if this is good.” You’ll see them discussing it in the chat channel. Like, “Oh, this PR needs a little more work” or that “this doesn’t feel good” and they’ll kind of let it go, and it says it’s a smooth way. And so, when people say like— For us, they were like, and Microsoft they tell this like, Hey, we ship every week and it’s magical and unicorns and hearts and stuff. And they were like, “Yeah. You and you’re a little toy mobile app that’s only been around for two years. Like come talk about our code base that’s 30 years old.” And so then I got one of those. So now the team that works on outlook Mac joined under the org. So we have outlook Mac mobile. So I always entered in Mac, and they had this 25 year old code base. It’s been shipping as part of office and Mac and incredibly complex. I mean, the build times are like 12 hours, like it’s insane to have a clean build, cause it’s like that much code it’s got all compiled down and even on crazy server farms that the biggest boxes that we compile on these trash cans like the Mac pros or whatever. So we have like stacks and stacks of trash cans. Like every developer has a trashcan pimped out with like a raid array of SSDs on their desk.

[01:01:27] Just to do the code pull is like three hours or something to pull the code from the Depot down to your drives. So, it’s so much code, it’s gigs and gigs and gigs of code. So when I was like, Hey— Source code, right? Like that’s insane. And so then I was like, “Hey, we’re going to ship weekly.” And they’re like, “dude, the build is like eight hour like this and that” and they had, you know, imagine they were shipping every three years, kind of traditional office had moved to like what they called monthly, which was actually every two months, because they would build for a month, ship, but then it would actually not go out. It would like then sit in QA hotfix, hotfix hotfix until they get it ready. And then they would actually ship that build about a month later. So it was really every, they were shipping every month, but a two month old build.

[01:02:06] And so it was like, “we’re just going to ship every week and we’re going to ship to real users and we’re going to take support tickets directly. And they’re like, “well, it takes eight hours.” We’re like, “Great. That’s fine. So if it takes that long to build that, if you need to release on Friday, start on Wednesday.” So, code for two days and then ship for three. And that’s what they did, to start with. And now it’s much better cause they’ve got the system, but it’s incredible. They used to hotfix on average twice a month, the production build. Their crash rates are lower than they’ve been in 10 years. And it’s all around this, nobody’s worried about missing the bimonthly train. They’re like, cause next week it’ll come. If a customer goes crazy and complaints, they are like,”Great, no problem. We’ll fix the bug. We put it in the release”, and we have insider fast that comes out every week, insider slow that comes out every month. And then production that comes out every month plus a week. So it’s like, the users pick the channel. We have tens of thousands of people. I mean, we have millions of users using the Mac client and we have tens of thousands of the beta, and then they take it and give us great feedback.

[01:03:03] And so those two things it’s possible, right? Like, if it takes you more than a week to do your build and your process, like that seems too long. So like, I’m sure you can get it done. So just reduce the dev cycles and then over time you’ll figure out how to work back to that model. But they’ve been doing this for, I don’t know, eight months now and it’s been incredible. And then we added like, “Hey, they need testing on the weekends? Great. We’ll send it to Testlio”, so Testlio tests the Mac products now as well.

Interviewer: So yeah, no matter what the problem, you will always find a solution.

Kevin: [01:03:31] Yeah. Cause it’s cause you take away the constraints, right? Cause they’re like, “Oh, I can’t ship on Friday. That takes this and that”, great then start on Wednesday. They’re like, “Oh well we’re only coding for two days.” “That’s fine.” Like, and you have to be like flexible to have that discussion and like, [inaudible] and then the PM’s are like, “Whoa, I don’t understand it.” And then now there’s no longer this tension between engineering and PM because there’s always like, “Hey, let’s go build this awesome feature.” And they’re like, “let’s go fix the bugs because the customers are complaining about the one we built last week first. And then we’ll build the feature.” And the data’s all there to support that cause there’s no debate. Cause the old days was like, “Oh, you’d ship a release, it’s been out a month, the code is completely diverged.” And you think of this like— I have a better word for it. But I always keep call that code baggage, or code backlog, the amount of code that’s been written that is not running on customer’s hands, and you want that to be minimal. So imagine like, think of all the code that your developers have written and how much of that is not running with the customer in the live site today. So what has been written that’s like in some process of like, it’s still in the factory, right?

[01:04:30] So it’s kind of like the way I think it’s Kaizen or what’s the thing that Japanese like super awesome model of just in time development, just in time product delivery? Like imagine that with software, you just want the minimal amount of software in flow so that it quickly gets through the pipeline and gets out to customers so you can get feedback on it and then that feedback powers everything else, right? And so the other problem was support, right? Like support, we’d go to this department in towers of people in other countries to collect all that feedback, and they were really just a monster bandaid. So they would be like, no matter what the problem was, they would make sure that it didn’t get back to engineering. “Do this, do back flips, try this, call that, reboot.” You know, the massive IT structure.

Interviewer: [01:05:05] And you were always very fast in your—

Kevin: Yeah, so our feedback was not that way. We’re like, that doesn’t work for me.

Interviewer: [inaudible]

Kevin: [01:05:11] Yeah, they would come back to support and you’d get like a month later this PowerPoint of like, here’s the top things that have been happening over the last three months with your product. And you’re like, “dude, that code’s gone. Doesn’t even line up with the feedback.” And then so we switched to in app support, and so the support tickets come in right to the engineering. And so if they release a bad build, literally the support tickets look like that chart on fire, you know? like they get all this funnel like “Whoa, pull the build back, revert it.” They know right away. And so that it’s great. They fix it right away. If you know right away, you fix it right away, you reduce the pain, right? The actual pain and suffering of a customer is really not the pain, it’s the pain over the duration. So if you can fix it quickly, and we used to joke— We ship lots of bugs still today at outlook and accompli, but we fixed them before most people notice, right? Our servers always go down, things are flaky out of network, we have VM problems. But, if we can detect it faster than most of the users notice, it’s the same as not creating it. And so, that is a much more fun way to work. Cause you’re working on the thing that matters versus sitting in a war room debating like, “Oh what’s going to happen?” or “how are we going to change the push?” No, just ship.

[01:06:16] I don’t know, I’m going to steal it from somebody, but somebody said like this notion of fail forward, we don’t roll back, we roll forward. Like the fix is always put the fixing and then keep moving. You know, you never see trains like, big ass trains backing up. That’s super hard. And that’s what it’s kind of,when you’re rolling back a huge software release, that’s what you’re doing. You’re trying to back up a train. Like there’s all this baggage and “Oh the database wasn’t designed to go backwards. And emails are going to have the wrong date on it.” It’s just messy stuff. Whereas if you’re like, Hey, if that thing’s always fixing forward. Yeah, it’s a cleaner way to work.

Interviewer: [01:06:46] So, I’d like to open up the floor for questions.

Kevin: Oh, oh.

Interviewer:  Seriously, I could talk to you forever.

Kevin: I’m kidding.

Interviewer: No, seriously. I had my questions prepared, but I already asked some of the questions, which is good, but who wants to ask questions? We have a microphone here somewhere as well. Perfect. Thanks. Thanks Christina. Awesome. So we got a first question. Over there. [inaudible]

Speaker: Hi. I’m going back to the time where you said that you had an idea and over the weekend you built a rough prototype to present to investors. How or did you test the market somehow, the market need?

Interviewer: [01:07:39] No, it was probably exaggerate. It probably wasn’t over the weekend. It was probably 10 days or something. But I mean, it was quickly, it was quick. We did not test the market. We didn’t go and say, “Hey, we’re going to try to build an email app.” We knew the market existed. Billions of people use email. Microsoft had a $12 billion subscription business selling email called office 365. Google had $1 billion business selling, even very few people pay for Google apps, but the ones that do, most of them are small companies, it was a billion dollar business. And we knew like, just like everybody here has a phone and everybody here has email on their phone. So we knew there was the market was there. The question was, was there a market need that could capitalize on? So we kind of backed into it, partly because we’d been in this space for long enough we were super convicted there was a spot. What we didn’t know is if we could make money and make it work and bubble above the crowd. And that was like, there’s probably another topic on like how we do marketing and I mean, I’m super [inaudible] about like, I went and Google searched all of our executives and made sure that our profiles were dialed in. So like you couldn’t find any like crazy party picture, like it just looked like pro.

[01:08:40] And so when somebody would search us, they would find the right page and like, and so like a lot of that marketing, so the market testing we did was really about managing our image to make sure that when people looked us up or saw something, or that every blog article we got, we instantly updated the recruiters like, “Oh, as seen on TV” kind of like to keep the momentum and like build on it, build on it, build on it and try to tie yourself back to trends and hotness and, yeah.

Speaker: Thank you.

Interviewer: Any other questions? Just raise your hand. He’s got the mic. Go.

Speaker 2: [01:09:11] Hi. About reducing the release cycle. Where did you get the idea from? I’m asking this? Because I think I read a book by Johanna Rothman who described a situation when she’s a consultant, described the situation when her customer complained that they’re releasing a lower and lower quality items to which she said, “well now we’re going to switch the release to one week” to which the customer said, “no, it’s impossible.” “Okay. In that case, let’s do it in three days.” So where did you get the idea?

Kevin: [01:09:45] Yeah, so I don’t read books. I do listen to audio books. I don’t actually read. But I don’t think I’ve read that book. I mean, it’s the agile thing, if you could read agile sprint length and like two weeks as the default, that kind of comes up. And so we kind of— nobody does agile the same. It’s all kind of some hack, right? We were like, we called it, we had some name for it, but it was like not agile, right? Like sort of agile, or agile fall, you know, everybody’s picks their own words for it. But yeah, we started with every few days and we’re like, that’s too often. At the time it was me, my cofounder, our wives like kind of using the app.

Interviewer: And you team only grew to like 20 people before—

Kevin: Total was 18. So we first started— yeah, 18 was the total, but we first started—

Interviewer: But the team was fairly small and you so much got done.

Kevin: Four or five people was the core team. were high. Very high. Yeah. So we start and then we went to two weeks and then we backed down to one because I realized that all the code was happening on the 15th day or the 13th day.

Speaker 2: Thank you.

Interviewer:  And most of your team was engineers, right? You only had like— I was, I’m sorry. So there was 21 people total, 18 was in engineering. And that’s counting myself and Javier and JJ as engineers. JJ and Javier wrote code. I never wrote code.

Interviewer: Awesome.

Kevin: But I consider myself still an engineer.

Speaker 3: Thank you. You mentioned Tim Ferriss. I listen to the podcast 4 Hour Work Week. Yeah. Listen to you. I hear, well, stumble into, try this, fail at that, you’re being very self deprecating, very humble. And I guess what I’d like to see, the question here, how much deliberate practice, how much intelligent design went into your career? Have you acquired a skill over time by hard labor because you know, listen to you saying, how can I get somebody else to do it in a lad? How can I like— Without the humility where’s your actual skill and how much effort did you put in to that? If we take it seriously, if you know what I mean.

Kevin: [01:11:42] Yeah, I know totally. Oh, that’s a tough question. I’m not even going to use the good question because I actually don’t know the answer off my head. So let me think for a second. I don’t know. I think I’m not afraid to fail, if that’s a skill, but with the deliberate practice comes into like, I love finding solutions. If I think of myself as like a little kid and like my mom would always like— I’d go back to this like, “what have I been doing for a long time?” I go back to when I’m a child, right? And so I think we had these go-karts and little motorcycles and stuff and we would spend 90% of the time fixing them, right? We would fix them, tinker, solution it, get on it and ride it till it breaks, which would usually be about 10 minutes, cause we would just keep going off bigger and bigger jumps and jumps until it breaks. And then so that’s finding solutions, but I can’t think of like a— Other than like looking for solutions, but a specific skill like, yeah, I wouldn’t say I’m an awesome programmer.

[01:12:35] I can read people really well. I think like I can kind of figure out like what’s you know, situations. I’ve done presales stuff and like, I was the engineer that always was like, Hey, the salespeople wanted to take me because I was like, I could talk and I could know about what he was doing. You know, cause you get like the engineer that like is really, really intelligent but like a rocket scientist and has trouble explaining and being chill and cool and stuff.

Speaker 3: So you’re like Richard Fineman of presales.

Kevin: Yeah.

Speaker 3: But is that like, so pardon me. [inaudible] I’m still getting a sense that you’re being very humble and obviously you’ve achieved great success. And I’m always with people, I try to understand what makes them tick in a way. So isn’t it like, we talked about goals a little bit here. If to fulfill a goal you actually have to put deliberate practice, focus on something. What are the goals that you are setting and how do you get better at achieving those goals? Like, what are the key things you look at? I’ll try it from a different angle—

Kevin: [01:13:35] Yeah, that’s reasonable. So I think the one thing, I mean, so I’m super like I’m inbox zero, like super [inaudible] breaking down tasks and organizing things and then managing them. And a small anecdote that might help is like, when we were getting acquired, that there’s lots of lawyers involved and lots of questions, and so they would send us these long punch lists of like, “give us all these documents or find all these things.” And Javier would literally, he would just be so pissed and he was like, “dude, why are they asking—?”, I’m like, “dude, this is the best.” And he’s like, “you’re so weird.” Cause I would get super Zen, when there’s a list I go to work and I’m like, let’s knock them off, all done. And I would happily do that list. They would tell me to do craziest stuff and I’m like, “no problem. We’ll do that.” And we would knock through the list. So, I get super Zen when there’s like a list and I can just see and feel the satisfaction of checking things off.

[01:14:25] One of my co founders is like, “No, I just want them to stop asking questions.” I’m like, when there’s a list we shouldn’t be having conference calls, let’s go to the list and then start the next call”, right? And so tracking things and kind of like— And then I guess another skill would be like maybe asking the right question. Like, a lot of times I don’t know the answer, or I’m sitting in a room of people that know many, many more things than I know, but if I could learn something from everybody and if you can kind of create the right question or ask the question, and sometimes I’m a little snarky about it or a lot of times, and I sort of set people up, you know, in that sense. Like if somebody was pitching me on their startup and they’re like, “Oh, I have a team of 10 people.” And I’m like, “wow, your engineers must be really ashamed to work for you.” And he’s like, “what do you mean?” And I was like, “not a single one of them mentioned your company on LinkedIn in their profile.” Cause I’m a creeper. I went and looked and there was not a single other person that mentioned it, right? But like, that instantly was a way to like get him to admit that he was really a one person company, right?

[01:15:25] And so I think in a lot of those cases I sort of enjoy that awkward moment where that question hits them. And maybe that’s a dark thing. I don’t know. When I was interviewing somebody, they said they worked at Netflix, but I went and looked at their LinkedIn and though and it just didn’t add up that they would’ve left Netflix, because I have a friends that worked there and they pay incredibly well, and you would never leave unless you got fired like after a couple months, in my view. And so I called one of my friends and said, “go look them up in the directory.” And they’re like, “Nope, not in the directory.” So, definitely got fired. Like nowhere in the directory, doesn’t exist in the system. So I got on the phone with a guy like, “Hey, how’s it going?” You know? And I’m like, “Hey, so tell me about what are you doing at Netflix these days?”, “Oh, I’m doing this”, “Oh, do you still work there, right?”, “Yeah, definitely 100%.” And then gave them all the rope to back out of it, never went down. And then finally I was like, “okay, so I called a friend of mine who looked you up in the directory and you’re not there. Could you explain like how you’d be the only employee I ever know that still works at Netflix and it’s not in the directory.” And then that like awkward moment where he’s trying to come up with the answer. Like I enjoy that because I know that like, trap set. 

[01:16:29] And so I think I enjoy asking those questions, but again, with the solution of saying, “Hey, I’m trying to hire somebody, I want you to be truthful and tell me what you’re thinking”, right? And so, but I don’t know. It’s a really good question. You’re going to make me think for a lot.

Interviewer: He has very good questions.

Kevin: Yeah. Thank you for asking the question. So I don’t know. I don’t know. Yeah.

Interviewer: Any other questions or? maybe we’ll take one more questions and then Kevin will stay here for a couple of more minutes and I’ll jump on him and ask questions. So Marco, go for it.

Marco: Yeah, I’m going to go ask my question, [inaudible] I know background’s a bit, so I’m going to ask about Microsoft. I know when you first started working there the whole organization is pretty decoded, right? There’s like huge structures and the way you were kind of thinking about it is like you don’t want to get like under it, right? Get into this, and knowing you, you’re not political right? You’re not playing around the fire. You’re basically jumping into the fire, finding a solution. And how do you feel now basically in Microsoft after one and a half years, I think?

Interviewer: Almost two years.

Kevin: [01:17:41] Yeah, it’s been over two years. So that’s a good question. I think the— So, I’m calculating, I wouldn’t say I’m not political. I don’t want to get into debates with people. I’d rather figure out a way to solve it without having to get into like a political type of debate. So ask leading questions to figure out who’s going to agree with you before you engage, you know, there’s lots of doctor no’s in big companies, people that will tell you, “Oh, we tried that. No.” Or like some departments you go and ask for approval, they’re like, “Oh, definitely not. Can’t do that.” And so in a lot of cases just do it. [inaudible] You know, so some of those things we can, and again, as the new guy play the new guy card of like, “I didn’t know any better.” And so a lot of the things you kind of stumbled through that way. But I think over time Microsoft is full of incredibly, incredibly smart people and I think I’ve worked at a lot of big companies before and so they’re super well intentioned. I think a good example was there was a team that was responsible for a key part of the release cycle and there was a team of like 10 people to do something that used to take us about 22 seconds at Acompli. And they were like, “no, it’s going to take a week and for you we’ll give you a special service. It’ll only be one day”, and we’re like, “No, we can do this in 22 seconds, like this doesn’t make sense.” And so it wasn’t that they weren’t smart, but they had built a multi decade career building this organization and all these checks and balances, well a week didn’t matter if they were shipping every three years to best buy, right?

[01:19:11] When windows was shipping every three years, whether a week or 10 days, it doesn’t matter. But now we’re shipping at the speed of mobile. So like, some of those conversations, I don’t know if there were political, but you had to address them, right? Because it was like if our release cycle is a week, you can’t take a week to approve it and you take a day, that’s 20% of our total time to do your piece. And so in some of those cases you kind of had to hit them head on and then— I called it the call dad thing. Like, “Hey just keep going to the boss’s boss’s boss” and you’re like, 22 seconds, seven days, like come on, help me out here, right? And be reasonable about it. But yeah, every situation was a little different, but I think half of it is ask for forgiveness. Just kind of do it, act as if it’s your job to make the decision, and then half of it is probably this calculating way of how do you compare? And we had a great example cause we’re like, “look, we were doing this as a small company” And yes, it’s a small company, but it shouldn’t be impossible. Like, we should be able to do this as a large company.

Speaker 4: [01:20:08] I’d like to know, you being an engineer, manager and an entrepreneur, so you say like you’re not the best coder. How have you earned the trust of the coders or engineers or kind of why do they like you or don’t like you? How the kind of being this direct, the like solutions focused. What do they think about your ex colleagues, new colleagues?

Kevin: [01:20:29] Yeah, that’s a good question. So, up until this point I never got performance reviews, really. Like somebody would say, oh they don’t like me or whatever. But Microsoft has an incredibly detailed performance review process. And so as you can imagine, this kind of direct make some enemies. Some people aren’t super comfortable getting these kinds of direct things. So, the way I counteract that is I ask like 50 people for feedback, where normally you’d asked like the three or four people you work with in like kind of a traditional peer review. But I’m like, there’s no cost. I just keep entering in more emails. So I’m like, 50. So, my boss is like, “I’ve never ever seen this much feedback.” And like 90% of it the most like, “Kevin is the best”. If they’re on your team and they’ve worked with you, and they’ll tell you why they think that, but there’s like 10% that’s like “worst person on the face of this earth.” I mean like really dark stuff. Like “if his cofounder wasn’t there, then nobody would even work with their team.” And again, some of these situations that are political, I had to push people probably harder than they were super comfortable with. And so I probably deserve it.

[01:21:35] But my key kind of thing that I think is, I’m incredibly responsive. So even sitting here as my phone goes off I have this incredible anxiety to respond to somebody who woke up in the US, weird hour, and want to just do whatever it is to respond to it. Like, so I love the notion of being incredibly responsive. So, I think my team enjoys that. Like super quick. Like how— And my whole notion of the way I do email is I respond to never have the email come back. Like, a lot of people write emails to engage in long discussions and let me tell you all my thoughts and 17 bullet points. Like, that’s not my style. Mine is like, “this is what needs to be done. Here’s my decision, if it’s on my job, or if it’s like not mine, massively delegate, right?” Nope, it’s this person’s decisions and I fully trust whatever they say. If they need help, they’ll come back to me, right?

[01:22:15] And so people love that working for me cause I don’t try to like micromanage. In fact, I’m like the Mac team that I took over it, they were like— He said to me once, he was like, “you’re like my worst and best boss. The best in the sense that you let me do whatever we want, we just get it done. But the worst in the sense you’ve shown me how terrible we’ve been in the world of before, I used to check balances and prepare for meetings, you never prepare”. I just walk in like this and tell you what I think, and that’s what it is. And if we need to go research it, we’ll do that after and somebody will take that. But I think the currency of a software company is shipped code, and the people that create shipped code are developers. So everybody at that company, from marketing to legal, to product managers, should be delivering and increasing the efficiency of creating currency in the company, which is shipped code. And a lot of people that, you’ll be like, “you’re just asking questions that don’t matter”. So, I’m really good at like, or I think I am, of like providing resources. Like, “we need new monitors.” I’m like, “order five.” And my admin is like, “well we you just need one.” I’m like, “Yeah, but I don’t want the next four people that ask, I want them to be sitting right there.”

[01:23:21] So I walk into our offices in New York and I’m like, where’s the Mac charger? And they’re like, “Oh, we have some of—”. I’m like, “No, go plug them in there.” Like, every conference room should just have chargers. Like you should never have developers be like, “Oh my battery died”, or like “I’m giving a presentation and there’s no adapters”, I’m like, “buy 20 of them, they’re like four bucks. Go buy a bunch of them. We have a [inaudible]” Nobody should be like, “Oh I can’t find the [inaudible] adapter. And I’m like, “just put them everywhere.” IT guys will try to like zip tie it to the wire, like there’s all these trick things. I’m like, “Just put them everywhere. Like make it so that they’re like markers. There should just be everywhere.” And so getting resources for people like the instant they need them and proactively thinking ahead, right?

[01:23:55] Like in Acompli it was like ordering snacks and like having drinks and all of the food there. You never want to run out of food, right? Like engineers run on red bull. And we had one guy was like, we called him “Diet Coke, Brian”, my four year old named him that. And I mean, he would come in in the morning and he would grab like as many he could get in his hand, three or four, and those would be gone before like 10, and I mean he’d just plow. He’s awesome. And so, my daughter was in charge, she was four years old at the time, she was in charge of loading all the sodas, and she always load the diet Cokes first because she knew that Brian was one of the early guys to get the office and she was like, “If Diet Coke Brian gets in there and there’s not—” you’re going to lose minutes because he’s going to look around, right?

[01:24:34] And so my thing is understanding people be human, right? I think people inside my team generally feel relatively protected and like hey, I’m giving them what they need to stand behind them if they make a bad decision, say, “Hey, that was my fault for giving you the paintbrush and letting you paint outside the lines” versus them painting outside the lines and so taking the responsibility. Yeah, there’s a great book called extreme ownership.

Interviewer: Oh yeah, you recommended it.

Kevin: [01:24:59] Yeah, it’s written by a Navy seal guy, and it’s all about like, whenever a team fails, it’s always the leaders fault. It’s basically the summary of the book. And kind of that example of like hey, the team painting outside the lines, it’s not because they painted outside the lines, it’s because you gave them the paint brush without the right training or the whatever, right? You didn’t do the right thing to make them or set up an environment so they could paint inside the lines. And so I think a lot of managing teams is just being human and understanding what people need, and then giving that to them before they even know. Like, I have stacks of MacBook pros sitting under my desk, why? Because if ever a laptop goes down, I never— Again, it’s like the hammer on the construction site, right? You don’t want the hammer to fall out of the craftsman’s hands. And it solved a lot of debates. Like when we first got to Microsoft, we never had PMs and we were just the leaders of the company, [inaudiable] the PM team. And [inaudible] like, “Oh wow. PM’s.” And I’m like, “Yeah, their for defensive purposes and big companies go talk to other people PM’s”, right?

[01:25:53] But the way that we solved— Now I think we have a pretty good integration and our PM’s are awesome. But I think the thing I always said was that the engineers write the code, and so if there’s debate between an engineer and a PM it’s like, “well, I don’t know. He or she who writes code decides”. And so if she’s going to write the code, then she gets to decide. I don’t care what the PM’s think or you know, what somebody thinks, they’re writing the code. Because the thing is they’ve got to fix it, and when the bug comes back, they’ve got to repair it, they gotta maintain it. And that’s a very freeing, crystallizing thing, right? So everybody in the office should be at some level this servant leadership to make sure that the thing that you’re producing, which is getting code to customers at shipping features is optimized, right? And so if anybody’s building something or doing something to get in that way, they’re probably not doing the right thing, or the most optimal thing, I guess.

Interviewer: [01:26:41] Well, everyone has responsibility. But yeah. Thank you so much, Kevin, for joining us today. Seriously, I’ve been waiting for this moment for the past— how long has it been? We’ve known each other for like three years.

Kevin: Yeah, three, four years. Yes. It’s been awesome. I only made it to Estonia. I’ve never been to the Baltics. It’s pretty cool. I love this area. Like you guys brought like the incredible weather the last two days, I landed in like Sunday and it was like pouring rain, as we flew in then it clears. I’m like, “Holy shit, this is awesome. It’s all green.” And then yesterday was incredible. Today we’re like out by boats and chilling it up and lunch.

Interviewer: Well, yeah, I think one thing that we can all learn from Kevin is to never be afraid to fail. Like no matter what you do, just don’t care about it. Do it.

Kevin: [01:27:21] Care, but don’t feel bad.

Interviewer: Do it with passion, but don’t feel too bad about it, because mistakes are human and that’s okay. So thank you so much for coming. Hold on. I have a— Where’s the present? We had a present for you, but I can’t find it.

Kevin: It’s burning, it’s on the fire.

Interviewer: We have a pretty funny gift for you, so you can open it up later on yourself.

Kevin: All right. On the camera.

Interviewer: Maybe you should do it right now.

Kevin: [01:27:52] I’m not afraid. I’m not afraid.

Interviewer: And the, we have a small gift for your wife as well. So Denise, maybe you can come here as well.

Kevin: Did I get like coal in my socks or something? Oh yeah.

Interviewer: We’ve told you this story of [inaudible] awesome.

Kevin: I like it.

Interviewer: [01:28:16] Dennise, thanks for coming here and joining us today, and seriously, of course.

Kevin: Awesome.

Interviewer: [01:28:26] Awesome. So thanks everyone for coming, seriously. And yeah, you can watch this video on YouTube afterwards as well.

Kevin: Awesome. Thank you, guys.

Interviewer: Awesome. Thanks.

Steal from the Startups: Growth Tactics for Grownups with Kevin Henrikson

Agile marketing tactics aren’t just for startups. Kevin Henrikson, veteran of two startups sold to Yahoo and Microsoft for $550M, breaks down his startup marketing strategies which he subsequently scaled for enterprise marketing teams.

Loren:  [00:02] Hello and welcome to today’s SEJ marketing think tank. Our biweekly Search Engine Journal webinar. With you today, my name is Loren Baker. I’m your host slash moderator and founder of Search Engine Journal. And today we have a very special guest, Mr. Kevin Henrikson, partner and director of engineering at Microsoft. I’ll let you say “Hi” real quick, Kevin.

Kevin:    Hey Loren, how’s it going? Thanks for having me today.

Loren:   Absolutely. It’s always a pleasure. Just to let everyone know, Kevin has spoken at our SEJ summit in the past and this presentation is in addition to some of his last great presentations that were very highly reviewed by our attendees. So in for a special treat today. To let everyone know, our official hashtag for the marketing think tank is hashtag SEJ think tank. If you’d like to tell all of your friends that you’re out there currently watching the webinar, feel free to do so on Twitter. We’re going to have the Q&A after Kevin’s presentation. So you’ll see in the go to webinar question box, that’s where you can enter your questions as they come up. We won’t be answering them immediately, but we’ll be going through them afterwards, and Kevin and myself will be answered what we can for you.

[01:26] This presentation will be recorded and the video will be available on our YouTube channel. That’s directly afterwards. And also when we’re finished with the presentation, we’re going to be giving you a small survey. So if you can take the time to fill that out always helps us make our webinars much better. Also, to let you know there’s going to be two polls that are launched during this webinar. So if you can take the time to answer those poll questions, it helps Kevin with his presentation, and it’s always great information and data to share. So I’ll hand things over to you, Kevin and get started.

Kevin:    [02:04] Awesome. Thanks Loren. Appreciate the invite. So today I’m gonna talk a little bit about some of the things I’ve learned kind of bouncing between both large companies and small companies. And some of the techniques and tricks that I’ve kind of come across specifically around growth tactics and how things that we’ve picked up at startups can be applied to big brands and in larger companies. So as Loren said, today I work for Microsoft, I run the engineering team for outlook for non windows, so iOS, Android, Mac. And today I’m hoping to kind of accomplish three things or talk around three kind of big takeaways or big areas of focus.

[02:41] So the first is you think about growth or think about marketing. One is kind of how you have skin in the game. So what is it that you’re putting into this, that you have something at risk or something to lose that makes you a better marketer and also makes you make better decisions. The second is this notion of ROI or return on investment, and whether it’s your time or whether it’s marketing money that you’re spending, you’re making an investment, right? Even if you’re not spending any budget, but you’re spending your time coming up with a plan or building out a campaign, it’s that time that you can’t get back. And so you want to make sure that you’re spending that wisely and have a model or a way to think about that. So as you make tradeoffs or you make decisions, you’re doing that in a smart way where you maximize the value of what you’re putting in to whatever you’re working on.

[03:23] And the final kind of third takeaway is this notion of a quota. And the idea that you kind of set up a plan for yourself but define it in very specific actionable goals so that you can decide, or you can measure against yourself and say, “Hey, did I hit this quota? Did I hit the goal that I said?” And setting very specific goals or in the sales terms, a quota, it gives you a very hard stick in the ground that you can measure against and know that you’re tracking towards your goal, and whether you’re ahead or behind. As Loren said, questions make this much more impactful. So as you listen to the presentation, and you hear things that I say that you disagree with or agree with, I would hope more disagree cause then it adds for a more fun kind of set of question and answers at the end.

[04:07] Please type those into the chat as you think of them, or you can wait until the end and drop those in during the interactive portion of this at the end. But that’s always my favorite part. So I’ll usually try to race through the slides. I talk pretty quickly, but feel free to kind of challenge me and find a discussion. So we’re gonna have a pretty lively discussion at the end of this.

[04:24] So a quick history on me. Like I said, today I work at Microsoft. I arrived there via an acquisition of my company called the Acompli. We built a mobile app that about 18 months ago was acquired by Microsoft and today is called outlook. And so if you go to the app store and download outlook for iPhone or Android, that is the app that my team works on. And if you don’t have it today, you should go try that because it’s awesome. But the kind of the journey of how I got there is actually more interesting. And I think that’s where I’ve picked up a lot of these techniques I’m going to talk about today. So over the past 16 years I’ve worked at three or four different startups and three rather large companies, Yahoo, VMware and Microsoft. So think of the work at a small company called Zimbra, got acquired by Yahoo who then resold that to VMware. Started a company called a Acompli, got acquired by Microsoft. And so I’ve had this kind of trend of every three to five years, kind of switching from a larger enterprise to back to a smaller kind of bootstrapped or venture funded startup.

[05:22] Traditionally I’ve always kind of been on the engineering side of things. So building the technology platform or the R&D organization of a group. But I have a real passion for growth and a real passion for marketing and how that kind of ties to growth. So think of it as growth hacking before they kind of call it that. How do you apply engineering techniques to getting great results in marketing? So, the way I stumbled into this is actually a quick story that I’ll tell. So if anybody remember back, there was this product that Google provided. It was called a Google referrals, and they had the one product in there called Google pack. And one day I was just, I set up a blog for myself and I put some AdSense on it just to see what would happen. And I noticed that people you know, came in and clicked on my ads and I’m like, “Oh, that’s interesting.” And then I started advertising my blog with a very tiny budget just on my name. And you know, noticed that people that would come through ad words would actually end up clicking on AdSense, again, in a very small proportion and it wasn’t profitable by any means. But it was just an interesting notion that you could advertise your site and have people actually come through and then essentially get re monetized by Google. And so as I looked at this further, Google had this notion of products, and at the time they had referral bonuses for two different products. One was kind of signing people up for their advertiser products, would it be an ad sense or ad words. And the third was this thing called Google pack. So this was before the days of Chrome where Google basically was selling or giving away a toolbar they would install. So they had Google desktop search, they had a toolbar, they had Google earth and a number of things that they bundled together.

[06:58] I think Picasa was also in there, a desktop plan. And everybody who downloaded that, they would pay you as a marketer or a referral fee or an affiliate fee. So think of it today as the moderate affiliate. And it was pretty great that they would actually give you anywhere from 10 cents to $2 based on the profile of the person, right? So if it’s a US based person that they’ve never seen before, they would give you two dollars upon somebody activating and downloading Google pack through a link that you provided. Or if it was more of an international type of approach, it may be only 10 cents in a country where the Google didn’t value the traffic as much.

[07:30] And so as part of that you would go and configure the download and so you would send people to a page on Google that looks something like this. You could pick up the things, you can see there is spyware Doctor, Adobe reader. There’s a Norton, they had a couple other things in there, but the main things they were promoting with the toolbars for Firefox and I. E. Google earth and Picasa. And what we noticed, or I noticed as I was starting to kind of set this up, was that you could actually run an advertisement for Google earth and buy that keyword on Google ad words for a nickel. So you could buy the word earth for 5 cents and send it to a landing page that would then promote Google earth, and somebody would download it through your link and you’d get paid $2.

[08:06] So it was a pretty good kind of motion there. And we scaled that out and had a lot of fun, you know, building this rather big business. I got tons of Google fridges that year until Google finally shut down the affiliate program once they acquired DoubleClick and Performix, they kind of merge them into their affiliate platform and shut that down. But it was my first kind of taste of this example of like super high volume advertising campaigns sent to a very simple goal, which was to get people to download Google earth and then got paid on the outside. And the tools that I built around and the spreadsheets that I built around that to understand the ROI was pretty simple. It was basically like, with the click through rates I had, as long as I could get people to my landing page for less than 50 cents, it would be profitable, because there was a good enough click through rate and conversion rate that that would end up making money on the two dollar kind of backside click.

[08:57] And so I had unlimited budgets and basically had this notion of saying, “Hey, how do I spend lots of money?” I also learned a couple of hard lessons around the days where my web host went down, or I made a mistake in one of the ads and typo  the URL and sent lots of money to a place that didn’t get spent. The pain was very real and since I was spending my own money, it was a pretty rude awakening call to find out you spent hundreds or thousands a day on an ad that then was a essentially wasted traffic. So we’re going to pause here for a minute and jump on our first poll. So if you can take a second to pull that up. I don’t know how long we’d like to give everybody, Loren, for this poll.

Loren:  [09:33] Absolutely. I usually give everybody up to like the 80%, Mark. So first off, I’ve just launched, “which best describes your role?” Please look on one of the following, director or manager of marketing, business owners slash manager, growth team. I’m not doing anything with growth for agency. So about 40% of you have voted this far. I’ll leave it open till we get to about 80. Kevin, I really liked that last slide because it totally dated both of us.

Kevin:    Yeah, I know. The Internet’s been around too long, right? And you remember when Google looked like that. Yeah, this poll is great cause I just always want to understand the audience that we’re talking to and say, Hey, how can we connect with them and how can I provide somewhat more meaningful commentary around the rest of the story here.

Loren:  Absolutely. So the numbers are coming in right now. We have about 70% of you that have voted. I’m going to shut down the poll in five seconds. I’d like to really, like I said, get to 80%. So if you take the time and just click one of those dots. Five, four, three, two. Okay. Final chance. Closing the poll. All right, so here we go.

Kevin:    [10:35] Cool. Very interesting. So a good mix of folks. Yeah, looks like everybody, most people or 90% of folks are at least doing something with growth or tied into a role that growth would be important to them, or whether they’re directly working on a growth team or not. So awesome. Very cool. Let’s continue.

[11:05] So, what did I learn? And so I think I briefly talked about it before the poll, but to summarize it’s really, really easy when you’re doing paid marketing or any kind of paid campaign to lose money really quickly, right? You know, just as quickly as you can make money, you can lose it. And so being aware of that and having direct sensitivity of that is something that to me really instilled that value of like really understand your campaigns, really test things, have a way of looking at your stats or metrics so it’s very clear if a mistake is made, or if a [inaudible] is made so that you can stop it quickly.

[11:34] Users if you have a need will come and droves, right? And so the ad was so simple, it was literally like, “come see your house on Google earth.” It was such a simple, simple call to action. But you know, thousands and thousands of people click through this campaign cause the interest to go see themselves on Google earth was there and it was a new product at the time, and it didn’t have a lot of distribution, which is why Google was paying affiliates to help them get wider distribution. Today everybody knows about Google maps and it’s one click to see earth. At the time it was a separate program. It was not embedded inside of Google maps and on a website, you actually had to install some software.

[12:08] And then this notion of small tweaks, like one of the cool things we did in the landing page was just dynamically looked up your location and gave you like a blurry image of the kind of region that you were from. So if you were from the United States, it would usually show that if we could narrow it down to a state, we would show that. But it would just be a blurry kind of image of that. And it was just very simple tweak of just adding a little bit of a kind of a personalized graphic that made a huge difference. It basically doubled our click through rate and conversion rate just by having something there that kind of gave the user a little more familiarity with what they were going to see next. And the ability for them to kind of get in the mindset of, “Hey, what I need to do is I need to install this thing and I need to run it, execute it.”

[12:48] But the final thing, I think the most important lesson here was that this notion of affiliate marketing or middleman marketing is hard, right? Like you clearly— the user is on one side and then there was, in this case, Google on the other side, and no matter how great of a business you built, you were kind of at the whims of both of them, right? Google ended up shutting the program down, which of course essentially destroyed this entire kind of revenue stream or this entire marketing plan. But there was— And I owned nothing at the end, right? I basically had bought a bunch of clicks, sent them to Google and then got paid on the result. So I was able to extract money from that or revenue from that during the time that it was running. But you know, at the end I was left with nothing, right?

[13:28] And so I think the piece that I took away the most from that was that affiliate marketing can be great, it’s a great way to kind of test monetization or to understand like what the interest level is. I mean people will be very creative. I’m sure Google learned a lot from the various affiliates that were promoting Google earth or Google pack or the various toolbars for the browsers. And they were able to incorporate that as their core plan. So you as like a business owner or somebody who’s on a growth team or something, when you— I always think affiliate marketing is a great way to kind of go and get crowdsourced advice on your marketing plans, right? So think of it as a way where you can go and spin up a small affiliate program or even if it’s just a referral program, right? You see every big company doing that today. And I guarantee it, if I’m working at a big company, I’m looking at the results or what people are doing from my affiliate or referral network to understand how are they marketing the product better than me and what can I do to my core marketing to actually improve it so that I own that kind of channel and I end up being on the right side of the affiliate game while that middle man marketing kind of, yeah, it goes away.

[14:28] So skin in the game, and this was kind of the main big point that I made, was that would you spend your money on it? Right? And so in this case, I was. I was running my Amex every day and my AdWords account and spending my own money. But whenever I talk to marketers or growth folks today, I’m like, are the things that you built, like the plans or the campaigns that you spun up, if you go to talk to your team, how many folks on your team or in your virtual team that are working with you would spend their own money on the work they did? Would you pay your own salary? Are you so convinced that the salary and the time that you’re spending on a particular campaign or effort that it’s going to pay off that you would actually spend your own paycheck to do that? Would you actually run your own money through the various paid marketing campaigns you’re doing or the vendors or the agencies that you’re using?

[15:09] You know, and that’s something that again, running a small campaign on my own, I was able to kind of have that very, very direct feedback. And again, when we were building Acompli it wasn’t necessarily our money in the sense that we were using venture backed money to build the team and the company. But at the end of the day, if we run out of that money, those last drips of cash were actually our paychecks, right? So every poor campaign we executed every time we went and did a test and lost a few thousand dollars on a marketing test, that was essentially taking away days of life of our company, right? Like the company is kind of set up with this, there’s an end date. Every day you wake up, you know that if you look at your current burn rate of your company, that company is going to run out of money on a certain date. And we had a cero cash date, and you attract that, right? If you hired somebody else and added somebody to the team, you would bring your zero cash data and you’d now be two or three months less in terms of a runway from your company. And so every time you make a hire, every time you go and build a campaign or do something, would you spend your own money on it and do you value it that way?

[16:06] And I think a lot of that is lost when you get to larger organizations or you’re looking at the tactical plan, you don’t step back and look and say, “Hey, am I actually spending this money wisely and would I go and invest in myself?

[16:20] Are the bets you making smart, right? Are they smart and how do you know they’re smart, right? You have a great idea in a thesis and you go and test it, but how much investment do you want to put on that bet before you say, “Hey, that’s going to pay off or not going to pay off”, right? And I think that’s an important thing to think about or realize as you’re going through executing campaigns or thinking about planning new campaigns, right? How do you kind of think about that holistically and make sure that you’re spending the right amount of time with the right amount of expected return. So one of the things we did is we built a spreadsheet and said, “Hey, here’s all these potential campaigns we could run for newsletters or web ads.” And again, this was when we were building Acompli. Different kinds of press outreach and various things.

[16:56] And then what’s the expected payoff of these? how many users do we think we’ll get? How many downloads do we think we’ll get from running this campaign if it’s executed flawlessly, right? And then as we would start to run these, we would compare that with our estimates and say, “Hey every time we ran press, we were actually, we overachieved”, right? Like we never, we didn’t realize like one great article from a news outlet or press would actually generate many more articles. And so we’d end up with, you know investing more and more in press because we found that that had the best ROI for us. Paid advertising in the mobile app space is incredibly expensive, especially when you have a new app that’s still trying to get out there and figure out its place in the world. But in our case, the ability to use press with something that we found out, and that was kind of the smartest of bets we made in terms of growing the small company that we had.

[17:45] The other thing I think about is, and I talked about like the zero cash date, right? Like what’s the penalty when you make a bad bet? Like what is your sense of urgency to correct a bad campaign? Like if you’re running a campaign and you know, we ran a test on LinkedIn where the clicks were incredibly expensive, but we wanted to understand and test everything. And in our case it wasn’t working. Like we were spending several dollars per click and almost getting just a fraction of that back in return in terms of users joining or signing up for our app. And so we within a few days we shut that off. Like we just weren’t getting the right signal, because we knew if we were going to sit there over invest in this thing, it would really hurt us. And again, as I walked into larger companies and larger organizations, very frequently I see campaigns where weekly or monthly a status report will come out and somebody is reporting on something and they’re still kind of tuning it or whatever. But the investment is huge, right? A lot of these are people treat as some cost, but they’re not, right? This is real money and it’s real time and effort. Even if you’re just reporting on a bad campaign, that’s real effort that you could be spent on building a better campaign or completely revamping an existing campaign. You need to have that sense of urgency to correct and adjust things when something is going the wrong way and not take it for granted that, “Hey, well we committed to three months, we’re going to let it run all three months.” It’s like, no, you need to go in there as soon as you realize something’s not going the right way and either make adjustments or just stop it.

[19:01] And then the final thing is don’t be afraid to fail, right? Like it’s okay. A lot of the campaigns that we ran didn’t work. In fact, most of the campaigns and the things that we did when we were building Acompli or previous to that we were buildings Zimbra, it didn’t work. Zimbra was an email company that was focused on open source and we had a very large open source network of contributors. And one of the things that worked really well for us was speaking at open source conferences. So that worked well. We started going to some other conferences that were more tied to IT administrators or server operators, and those just completely felt, we didn’t get the same level of feedback, we didn’t get the same level of interest in our product because it just didn’t resonate, right? and it’s okay. So we went and tested a set of conferences and spent money on them and paid thousands of dollars for a booth, but very quickly pulled that back and said, “Hey, we learned something there. That’s not our target market. Let’s move on”, right? I think that kind of goes across all these growth campaigns and things. Feel free to take risks and try things. Don’t be afraid to fail, but just do it quickly and then be ready to move on if it doesn’t work with what you want.

[19:59] So another kind of story here, it was tied more around when I was at VMware, was they were launching a VMware fusion five. So this is, if you don’t know what fusion is, it basically allows you to run windows on your Mac or Linux or whatever, but it basically allows you to run a different operating system on your Mac. And the cool thing about fusion was that it was, and VMware in general, was that it was an incredibly popular channel sale. And what I mean by channel sale is that VMware at the time sold very little of the software themselves. It was sold through BestBuy, various retailers and different web stores, Amazon, software houses, some brick and mortar [inaudible] where I was even going to Fry’s and buy the box back in that day.

[20:44] But there was a very small website that we on that actually would sell a VMware fusion, but it was a super small focus. And so basically every year this was roughly a yearly released product. They would come out and they’d run a small marketing campaign a couple million dollars, again, small for a large company to go and just advertise the web sale, but just really didn’t track it, didn’t look at it, just said, “Hey we’re launching the new one, let’s go run some ads and see what happens.” And surprisingly didn’t have the tracking because 95% of the sales didn’t come from this web sale. It was really coming from partners and channels. And one of the things they did was added in the tracking. Finally, for VMwork fusion 5, to actually track on a per click basis and per campaign basis how much of this money was going in. And of course to no surprise when you first start tracking something, you find some really, really interesting data or ugly data, if you ask me, that again, 70% or 80% of the marketing spend was completely wasted, right? We were buying these billboards and we were buying airport ads and things like that that just weren’t converting at all. Yet the web advertising that we were doing on a couple of very targeted websites was doing great and all we had to do was shift a little bit of the money over to that. And sure enough, we quadrupled the web sales, and now I think VMware sells, a huge upper percentage of the actual sales are directly through web sales. And they have the benefit of having a direct relationship with those end users of the software versus where when they sell it through a retail store, they didn’t.

[22:07] So we’re going to pause there for a minute and a fire up our second poll and see if we can get a little more understanding about what you guys are struggling with in growth.

Loren:  Absolutely. So the is launching, “What is your biggest growth struggle?” Producing enough growth ideas, finding time to manage and review growth data, consistency of active growth projects, or growth budget. So please take the time to vote. Great stuff, Kevin, by the way.

Kevin:    [22:35] Thanks man. No, it’s exciting. Like, it’s something I always— When I get to take a break and talk about things like this it’s really, I always think back to myself as I’m talking through some of these examples. You know, I think back to things that we’re doing this week or things that we did last week where I was like, “wow, maybe we didn’t cut that short enough, quick enough or we should dig in”. So, I’m kind of scribbling notes here on my desk to things I want to check in after this. So it’s always a great reminder. You know, they always say teaching is the best way to learn.

Loren:  [23:02] I haven’t seen many billboards for Acompli slash outlook recently.

Kevin:    Yeah. We don’t run billboards for that. So it’s one of those things where there’s other ways to advertise for it. And as you would imagine, billboards are probably not the best way that people learn about a new email app.

Loren:  Okay. We have about 71% voted thus far, so I’m going to close this down in about five seconds. Please take the time to vote in the poll if you haven’t already. This is really useful data by the way. Five, four, three, two. All right, last chance, one. There you go. Closing the poll and here are the results.

Kevin:    [23:40] Wow. Pretty even split. Great. So let’s pause for a second. Actually, you just talk about this. I think the top two seem to have the most popular, right? I mean, basically producing enough gross growth ideas and then just finding the times to go over it. So one of the things that I think we struggle with this too. Finding new ways to kind of brainstorm has been interesting. And one of the things that we’ve done is that at the start of kind of our weekly meeting where we talk about metrics and growth, we spend a few minutes and let people just throw out new ideas in a completely like anything goes kind of way like, “Hey, did we try this or can we try that?” And there’s no judgment. We don’t really talk about them or debate the merit of one or the other. But again, it’s five, 10 minutes. People just throw out what they thought. Something they saw on the way to work. You know, you’re on the commute, you’re on your train, [inaudible] in the Bay areas of San Francisco, you ride a Bike and you see like an ad or you see something [inaudible] as you’re riding up the peninsula, you know, what did you see? And there’s tons of new companies and new startups kind of always coming up and trying different inventive things. And so, we just use five minutes to just say, “Hey, what did you see? What did you think about?” Right?

[24:48] And again, it’s five minutes, 10 minutes max, kind of a weekly kind of growth update. And it’s a great way to just kind of throw ideas together and then a project manager or a smaller group of us will kind of dig into those and talk about them and do some more research offline. But it’s a great way to just start capturing ideas and kind of kind of have a rich backlog of ideas.

Loren:  [25:11] It’s also important, and then one thing I’ve gotten from this too and some of your past presentations is the importance of actually taking those ideas and putting them into a process where you’re getting closer to actually launching it, right? Because it’s nice to have an idea bank, but there’s a big difference between an idea that’s written down and something that’s executed. And that’s a big challenge for a lot of entrepreneurs or even someone working in a small business, is that— I know in the world of search, like we’ve had ideas for forever, “Hey, let’s build a marketplace on search engine journal where people can find agencies or consultants.” And we’ve probably pitched that idea around for eight years, and now someone has gone out and built Credo, which is just that and they’re doing great, but they actually took the time to take an idea that probably thousands of people have had and launch it. So that’s also a really big difference.

Kevin:    [26:08] No, that’s good. And that’s how I was going to kind of address the second point. Like we use this thing called office 365 planner, which is similar to like a Trello or Asana task management solution that comes with office 365. And what we always— we enter it into that as our backlog. And what we do is we literally ask one question which is, if we wanted to try this idea, what would be the next step? Right? So if you’ve ever read like a Stephen Covey, like getting things done, like it’s all about like, let’s not plan the entire thing out. Let’s just, what’s the next thing? What’s the next piece? We need to go ask a question, we need to go do some research. And being able to crystallize that next step and put an owner on it has been made a world difference, of incrementally everyday kind of, or every week moving the ball forward on a variety of new ideas. And again, don’t try to like completely plan out the whole growth or figure the whole thing out. Like what was it be the next thing to validate whether this is something we could do and whether it’s something we would want to do. So it’s a great point.

[27:01] Okay, so the next point is kind of this notion of ROI is everything, right? So like, you have to figure out whether the investment you’re making, whether it’s time or money or effort from an agency or somebody you’re working with is paying off, or even the folks in your group if you’re managing a team you know, are your team members working on the right thing? And so the number one thing is you have to track it, right? You can’t manage what you don’t track. And so I use this thing called rescue time, which is a very simple little tool that runs on your desktop that just tracks what time you’re spending in various applications around. So it’ll say, “Hey, you’re doing so much time on email, you’re spending so much time on these kind of websites, or you’re spending time on Facebook”, and I just breaks it down. Very simple, right? It just gives you a little pie chart and they send you an email every week that tells you how much you’re tracking. But that just gives me a gut check on like week over week am I spending too much time on sitting in email all day when I should be spending more time writing up plans or working through, or reviewing our backlog or doing something like that?

[28:03] And then on the actual executable you have the goals, right? You’re trying to grow the number of users, you’re trying to grow revenue, or some combination of that. You’re trying to grow maybe leads if you’re in a sales type role or you know, you’re just part of the funnel, you’re not tracking the whole funnel, but you need to have the tracking in place. And so one of the things we did that was interesting Zimbra you know, again, very early, kind of back in the web 2.0 days, is that a lot of our sales came through web advertising and then a very simple trick, which was literally to grab the keyword from each of the ads and pass that all the way down to the Salesforce record. And so now when a salesperson would open up a Salesforce contact or lead, they would see the actual keyword that that person searched on, right? “Oh, they searched on open source email. They searched on calendar, they searched on calendar for iPhone, or email for iPhone”, right? And you would get kind of into the mindset of that person and it gave us this incredible two way loop. One was it gave better data to the sales reps or the SDRs as they went to make outbound calls or talk to these contacts.

[29:02] But it also let us draw a direct line back to the advertising campaigns, right? And so again, there’s tons of tools to do this and ways to do it. And a lot of times it does take a little bit of programming or a little bit of custom engineering to kind of integration to close that loop. But if you don’t have that full complete loop of tracking all of your campaigns coming in. So in the mobile world we use this tool called adjust which is an SDK you put inside your mobile app. And every campaign you run, you give it a unique identifier, whether it’s you know, a web pop up or you’re running an ad or you’re having a referral from another app, right? You want to track that and so you have all these channels and then you just kind of passively are collecting this data and then as you to look and judge campaigns against each other, you can take this notion of saying, “Hey, we’re spending this many dollars or this much money or this much time on a particular campaign. How does that compare against this campaign? Or how does that compare against our organic traffic?” where you organic traffic may be driven by press or some other kind of brand building exercise, right? Should we balance that off against each other, and it gives you that kind of very, very actionable data to go and make that trade off without having to spend a lot of time debating which one’s the most important or which one’s working below.

[30:09] You know, I always had this kind of saying whenever we do paid advertising is that PPC is free. Like, if you’re doing it right, if you have the tracking set up, you should never have budgets on PPC, right? The fact that most companies, especially large companies I’ve work at, set very fixed and rigid PPC campaigns budgets, is that they actually don’t know. They don’t know that a web sale or a particular sale is tied to a specific ad, right? They don’t have that tracking in place to know that this particular AdSense ad or an AdWords ad or you know, campaign that I ran on a private website actually drove a sale, right? And many of this it’s because it’s a complex sale, right? There’s many touch points in the process, but there is a way to understand the value of the lead or value of an opportunity, or the value of a mobile user, or the value of a new trial account on your software package, or whatever you’re selling or whatever you’re working with. There’s always a value, and maybe it’s a fictitious style. You maybe you say, “Hey, a lead we think is worth a dollar. Cause we take all the leads we added up and you know, this many percentage of them closed and our average sale is X.” Like we can map out an equation, right?

[31:13] And so you should be able to have that math, and if you don’t, you should be able to go to your executives or your board and say, “Hey, we should uncap the PPC budget because we’re so convinced that this is working and tracking as well, that we shouldn’t have a budget.” And you shouldn’t have this notion of like, “Oh, we’re only allocating this much to our paid campaigns”, but almost without fail, every company I go to ends up having incredibly limited hade campaign budgets because they don’t actually have great tracking, right? And you know, depending on the size of the company, that limit may be bigger. But the main point was that if you had really, really convincing traffic where you knew 100% competence that a particular paid click would go through and what that was value is worth. You shouldn’t have to have a budget to pay it.

[31:55] And then the other piece that I always track is this notion of a positive ROI, right? It’s like breathing, right? Like once your ROI becomes negative, you’re spending money to lose money and that’s just not a good thing, right? So as a start up, this is like the perfect way to kill yourself, right? If you’re spending more than you know you’re going to bring in and you don’t have a way to get new funding or you’re generating marketing activities that are just massive loss leaders with no hope of like building market share. Cause there are cases where, Hey, you have negative ROI because you’re building market share or there’s some other value that you’re building. But in many cases you see it where you’re spending money and generating tons and tons of leads, but maybe those leads are crappy. Or the customers that they’re bringing in aren’t targeted correctly and end up driving your support costs up, right?

[32:36] So we’ve seen this in the past where we wouldn’t market it to very low end email customer in a previous life about 10 years ago and we were getting tons of leads and tons of signups for all these like one and two person kind of email domains. But the support costs of setting those up was three or four times the value of that customer, right? And so very quickly, it took us longer than it should have, but once we realized it we completely shut off that campaign and just said, look, we can’t service that customer. It’s not profitable at the price point we were trying to sell it at.

[33:06] So one of the things I’m going to talk about here is this notion of a quote because it’s kind of the final big point, right? If you ever ran a sales team or been around sales teams most sales professionals have a quota, right? They’re going to have this many thousands of dollars they need to generate a new business or in renewal business over a fixed quarter. And that target is what they get commissioned on and paid on. If they hit their target, they get 100% of their commission. If they overachieve and get more than their quota, then they will get a bonus or a kicker. If they underachieved then they will not get their bonus or not hit their kind of pay target. But this should apply to your marketing campaigns, right? Like you need to think through and say what is that target? know, just like the best sales teams in the world go and say, Hey, if we’re going to try to hit $1 million in sales, they don’t assign exactly $1 million in quota. They’ll assign $2 million in quota across all the sales reps. And so knowing that some things won’t work out, some will overachieve, some will underachieve. But in the net, most of your planning is optimistic, right? And that optimistic planning ends up is where you end up missing. And so marketing and growth should have the same thing, right? If you say, “Hey, I need to hit 500,000 users in the next quarter.” You should build a plan on how do you get to a 1.5 million or a million, right? Double or triple what your actual goal is knowing that some of those campaigns won’t work out, cause setting yourself up just to hit the 500,000 is more than likely not gonna work.

[34:26] And what we’ve found from our work is that even in the times where you set it to 1.5 or you know, a million, so like three times your actual goal, you still may not get to the 500,000, but if you would’ve said just the 500,000, you would have even gotten to a lower number, right? And so setting big goals, doing the planning and effort to go in and spec out what do you think a target should be or how much you should achieve from a particular growth or marketing tactic is incredibly important. And you need to have very actionable goals with numbers. Not just saying, “Hey, we’re going to go try this thing and see what happens”, but we’re going to try this thing, we’re going to generate this many leads or this much growth over this time period. And then you can chart it week over week, what that looks like.

[35:07] Each channel think of that as a strategy. Just like in a big sales team you would say, “Hey, we have the enterprise sales team, we have the small business sales team, we have the inbound sales team, the outbound sales team.” Think of that as your campaigns, right? Think of these as a strategy and manage them individually and say, “Hey, are each of these behind or ahead?” Cause maybe halfway through the period you’re like, “wow our web campaigns are just not doing what we want but our paid campaigns are doing more than we expected.” You can shift focus midway kind, double down or triple down on the ones that are working the best and defocus the ones that aren’t working with, again, that goal of being incredibly aggressive and looking for the maximum success inside of the timeframe that you’ve set up for yourself.

[35:49] And again, this kind of notion of fail fast, right? So if you’re tracking these things as individual units and not just saying, “Hey, our growth numbers are walking up and we have seven different channels that we’re advertising in or trying different growth campaigns that we’re running.” If you are not measuring them individually, you can’t go and cut off the bad ones and kind of cut bait and say, “Hey, we’re good. We’re going to let that one go and then try again later or just stop investing there and let it run on its own because we really want to go focus on the big ones that are going to give us the biggest sale.”

[36:16] So to summarize kind of the three beams we talked about today, the big charters was, Hey you’ve got to have skin in the game, you gotta have a way that you are committed. Whether it’s you putting your own money and just having that mindset in the back of your head, is that the activities you’re taking, would you spend your own money on that? and just use that as a simple kind of gut check of if you’re doing the right thing, this notion that everything has a cost, right? And so you need to have a great ROI model in your mind, of the time you spend, but also the money you spend on various campaigns. And then finally, this notion of kind of oversubscribing or having a quota so that you can really do a great job achieving those numbers and you know, whether it’s a small company or a big company the same kind of techniques kinda play out over and over again.

[37:00] So that’s the end of my presentation. If you have questions, I’d love to kind of take those now and Loren can help pitch those up to me. And we will go from there. You can reach me on Twitter at Kevin Henrikson or got to go from this.

Loren:  [37:14] Absolutely. Thank you, Kevin. Always good stuff. And yeah, we have about five or six different questions. No one called you out unfortunately. But maybe that will happen after the fact. So question number one, rule of thumb, how much budget should be set aside for experimenting? 

Kevin:    [37:39] I always think it’s somewhere between a third and 25%, right? And I think and when you say that people say, Oh, that’s way too much. But what I think of experiments is I think of things where you’re not 100% confident they’re going to work. And so of that 25% or 33% kind of a third to a quarter, some things you’re going to say, “Hey, we have a 50% chance that work.” Some things you may have like a 2% chance that worked, but if they do, they’re going to pay off. And so I think I would taper it based on what’s the profitability is and make the bets appropriately, right? So invest in the ones heavily where you think there’s a higher chance, and then invest less in the ones where you think there is a lower chance until you start to see that they may work or not.

Loren:  [38:18] Makes total sense. And overall from all of your internet marketing efforts. And I would say possibly, and let’s just look at accomplishing outlook. What got you the best results? Social media, email marketing, SEO content? So all of these are fairly organic here.

Kevin:    Yeah, from us, from our point of view, the number one best result was from press, right? So having a great content strategy and either doing guest posts with press, but most of the actual traditional press, like going out and talking to reporters telling a story. But the key there to do great press is to not just write a press release and send it out and hope you get it. It’s really to look at what those people cover and understand what they cover and have a story. Like what is it unique about your story? Like, nobody wants to know about some new startup doing X, like there’s a million of those and you can just go read them off tech crunch every day, 20, 30 new startups launch and get funding or whatever. but what’s your unique perspective or unique opinion on it, and how do you get that to generate a great press story that they can tell. And so by far for us press and kind of traditional press was by far the best.

[39:30] I think second to that was a much more in product and native experience where with every person that signed up for accompli or outlook, the signature would basically say send by outlook or sent by accompli. And that link would link back to the download Link. Again, think of things that are in your product and make sense whether or not you know, going to be too aggressive. But there’s things that people were actually proud of it, especially in the early days when we had the beta as a closed system, people had to kind of apply to get in and there was a lottery system. They were like, “Oh look, I have Acompli” and it was kind of like a badge of honor, right? And we only made it that sense and that works really well for us.

Loren:  Cool. Yeah, and I remember you had a social media campaign writing, which to put Acompli in your main iPhone dock, right?

Kevin:    Oh, rock the doc. Yeah. So we figured out, as you would imagine if everybody pulled their phone out today, right? There’s the four or five main icons you have in your doc. Like those are the apps that you’ve deemed the most important to yourself. And we made this ask to people and said, “Hey, we think Acompli is great. We think outlook is great, rock the doc. Send us a screenshot of you having our app in your dock.” And knowing that once people put those apps down in their dock, the usage of them as a daily user are incredibly active user just skyrocketed. And so it was a great campaign and people had a lot of fun. And we actually, there was a secondary benefit that we learned from that is that when people would post a screenshot of their homepage, we would see the other apps that they used. And so it actually gave us great insight into what other apps our target user used. And then from that we were able to go out and in some cases generate partnerships with other apps and say, “Hey you, you also use our app. People are in the same community. We should work together on either doing a joint press release or maybe an integration.” And so it was a great kind of starter for us to go and have that data to go share with our partners and part of our BD efforts.

Loren:  [41:07] That’s super cool. And what still frustrates me to this day with traditional Gmail is that you can’t launch an invite on your Google calendar through Gmail anymore. Remember back, you used to be able to just hit an icon and do it, and then you guys pretty much launched that feature right after they took it out.

Kevin:    Yeah, I was the same way. Like to me that’s a huge feature, when I get an email from somebody like, “Hey, can we meet for lunch?” I can send my available times. And then they say, “Hey, we want to meet at one o’clock on Tuesday.” I can respond right back with an invite, right in line in the email. And yeah, it’s an incredible time saver and yeah, it’s something that Gmail and outlook didn’t have before we kind of brought that into it.

Loren:  Very cool. Very cool. So what’s your advice as far as investing money in the social media campaigns? You know, is it worth it for you to try to, do you think it’s worth it to try to grow your overall growth and reach when you’re not necessarily getting that initial return? And for example, adding things like Facebook boost or Facebook ads on top of what you’re typically doing from a social media perspective.

Kevin:    [42:15] So what we found was, and you know, we’re a tiny, like as a company, right? We were a tiny company. Nobody knew our brand. Nobody really heard of us other than kind of our coworkers or our friends or our spouses. But what we found was that we actually had the most success, you know, as we would get press, we would retweet or share those on Facebook and then we would promote those. So we were basically promoting articles about ourselves written by other, more famous third parties. Like the verge would write an article, or tech crunch would write an article, or somebody like ink magazine would do a detailed— or wired magazine would do it. As we would get these articles, we would go and promote those. And so we found the most success using our handle to kind of retweet and repost things and then put paid budget around that. And that ended up building about this second level like authoritative links of saying, Hey, these are links that other people are writing about us, because us just tweeting things wasn’t that active.

[43:03] I think the one thing that we did do on social that was kind of cool is that as people would post their doc or as they would comment to us on Twitter, we have this kind of badge thing where if if you posted, and I noticed you’re from Germany, and we would post a cool picture of Oktoberfest. And if you posted and your from Canada, we would be like, “yeah, we love Canada too.” Like we would always respond back with like something very personal about that person’s Twitter account. You know, you can read it off two clicks into their Twitter account. And then put a little image up and we’ve found those got retweeted and shared it. And then it almost— people wanted to come and interact with our handle just so that they would see what badge they would get. Like, Hey, you’re in a rock band. And some were funny, right? Especially where we would Google somebody’s name and it would match like a famous artist or it would match somebody who was not them, but somebody who had a likeness of them, and we would retweet it back and they would really get excited to see like what we came up with. So that was one little trick that we did. And again, it was kind of to build a little bit of social buzz. But by far the biggest payoff was promoting other stories that were written about us.

Loren:  [44:05] Yeah, I totally agree with that as well because you know, when people follow you on social, the last thing they really want to see is you constantly tooting your own horn. And if you can have a trustworthy publication doing that for you, it’s not necessarily just showing off, but it’s also the, “Hey this person that wrote this and we’re featured” and hey, you’re educating the user at the end of the day. And it does add that layer of trustworthiness. I’m not sure, I don’t see a lot of companies doing this, but one that I do see doing it in my Facebook feed is a company called Elysium. And if you’re 40 and over in male, you probably see their ads show up in your Facebook feed. But they’re an anti-aging supplement company, right? But all of their advertising is from articles in the New York times and USA today and US health and news mentioning their company. They hardly ever do a direct a sales component from it.

[45:17] And now they’re probably retargeting after the fact or whatever it may be. Maybe targeting their ads to those specific publications. But you know, what they’re doing is, first of all, people in the industry can’t advertise as much as a normal company going on Facebook, but at the same time, they’re building that trustworthiness right around the product, around everything else. So if I see more companies outside of anti aging companies do that, I’ll definitely take some snapshots.

Kevin:    [45:45] No, that’s a good call. Yeah. It’s that whole kind of like associated with kind of marketing, right? where you get that basically you’re one step away or one level away, but you’re using a more validated source to kind of be your major mega megaphone.

Loren:  And then like personally, like if I ever get picked up, I’ll be like, “h, I totally forgot. I talked to this reporter”, a humble brag in USA today, or whatever it is. And then people like it, share it, etc. They love that stuff. So, I rather see a company share where they’d been picked up or mentioned more so than what they’re always talking about on their own blog. Okay. So, rule of thumb in the world of SAS, how far out do you look at retention? Sales are great, but what about churn? So how has churn rate and retention of the customer been part of your overall strategy? And what highly effective campaigns or channels have you used that have had a lower retention and high churn?

Kevin:    [46:52]  Lower retention. Okay. Got it. So I mean, so there’s a couple, it really depends on the product, right? So if you’re like a SAS product where you have like a yearly renewal cycle, clearly you want to look at like your renewals over that, you know, one year period. But, obviously that’s an incredibly late signal in terms of being able to fix things. And so what we do from a mobile app perspective, is most people look at their 28 day or one month retention, depending on how you’re measuring. So either four weeks or you know, just a straight 30 day and that gives you a much tighter granularity. But if you notice most apps, if you draw the line back and you just look at the one day retention, you see most of your drop in the first day, right? 

[47:29] So most mobile apps today have a drop off in the first day. And so you can do a lot of optimization and a lot of testing and get feedback the next day to improve your one day retention. Cause every time you improve your one day retention that just has an accrue value to your one month or then obviously your one year retention. So, that’s kind of the way I look at it. For mobile, it’s really, you know, you look at one day and 30 day. For like a software kind of SAS package, you look at it kind of like whatever the return rate is, if it’s a monthly type fee, then you want to make sure that you’re getting usage and retention over that month so that people renew every month. If it’s a more yearly type plan then you want to look at it over a longer period.

[48:07] We found in terms of like, and I think the question was, you know, where’s the high churn low retention? I think you want the opposite, which is high retention, low churn. I think what we’ve found is that the ones that retain the most are the ones that were the most targeted coming in, right? So when you run a really broad base, you know, think of the banner in the airport or the, you know, “Hey, this thing is going to do be sliced bread for you.” And you have like the very broad wide net of like “this Apple solves all your problems”, Like that may attract lots of users because you’re making a very broad plain, but generally those users churn very quickly and you see that right in the one day, right? You’ll see like, they’ll come and check it out, they’ll poke it, they’re like, “Oh no, this isn’t what I thought it was”.

[48:50] We ran some ads like that around like, you know, best way to best app for travel. Because hey, you know, accompli and outlook works so well when you’re a mobile and you’re traveling, we have optimized a bunch of things around, you know, being on a crappy wifi networks and optimized data usage and all of these things that we were sending it to like this really broad travel audience, but you know, yes, we’ve got some engaged users there, but the churn was incredibly high, right? But then what we found is we’ve got retention almost to double just by saying, “Hey, the best way to do email when you’re on the go”, right? So again, still kind of targeting that on the go traveling user, but on the go could be to mean, “Hey, you’re just commuting to work in the morning. You’re coming on the train or you’re going through a tunnel and you’re going to lose signal.” Like, “Hey, the app still keeps running and keeps everything offline. It works smooth for you.”

[49:38] And those, again, we basically doubled it just by tweaking that campaign a little bit to be less, kind of like broad based focused on anybody that travels to really be focused on people that are trying to get work done on whether it’s they’re commuting, whether they’re actually on a trip or they’re on vacation.

Loren:  So it sounds like the difference between being a Pied Piper and a Pokemon go is making sure that one, you’re setting up that sense of timing, right? Free Trial, free for a month. Hey, let’s do a notification that you only have like X amount of free DocuSign’s left for the month, or you’re about to run out of this or you’re about to run out of that, etc. And then two, understanding which of your markets are churning and addressing that in your initial marketing collateral, right? Marketing message. So [inaudible] out there beforehand, and not set the expectation like, “Oh, you only use this when you’re on the plane or in the airport, etc.”

Kevin:    [50:35] Yeah. You want to basically capture the end user intent and the better and the more accurately you can depict that upfront, the better off you’ll be with people sitting and staying on your product.

Loren:  Absolutely. One question from Ryan is, any advice using web marketing to break into international markets?

Kevin:    [51:01] So what we did is we went and looked at some of the top international markets that we wanted to get into. And the main thing was, in our case, we were doing a mix of paid and press campaigns, and what we actually did is we ran paid campaigns, targeted it at writers and press analysts internationally. So we tried to get the attention of press by basically retargeting them by friending them and connecting with them on Twitter and then retargeting them on Twitter and sending sponsored posts translated into their language. And so what we would do is we would take, you know, Spanish for example, or Portuguese, and pick some of these top countries, Germany, France, and target the writers of the big magazines or the big kind of web community sites, and use that to target them. And then be able to engage them with our handle and Twitter, and then from that go and actually do campaigns. And again, once you get them to write an article about you or covering you, then go and run, again, a localized version. 

[52:02] So like, Hey a big German new site wrote about Acompli, then we went in and spun up a social kind of web campaign around that, using that article in German about like, as the way to get there, right? Cause again, you know, getting the translation just right as a non native speaker and through these translation houses generally isn’t good. So we could do that with small pieces of texts like Twitters, tweets, little Facebook messages. But then once we kind of get an article that’s written by a native speaker in Germany, then you can build a campaign around that because now you have a great kind of proof point that somebody else has talked about it, and you’re able to kind of use that as your kind of jumping off point.

Loren:  [52:35] Yeah, you can really build upon that and once you get it out there and just blast it accordingly. So that’s really smart. Going through the rest of the questions right now. Oh, here you go. How did you initially grow your email list?

Kevin:    [52:52] So it started off with literally friends, you know, posting it on my own social media, all of the kind of the two or three co-founders did the same thing. And so that kinda got us into the hundreds, you know, just by posting our own friends group and saying, “Hey, we’re building something interesting.” Put up a really simple webpage. We used this thing called kickoff labs. It’s kind of like a Launchrock page, where Launchrock page you can enter an email address and we’ll notify you when it’s ready. And so that was kind of the first phase that got us into the, maybe I’ve learned a thousand email addresses. And then, we went and scoured the internet for all of the places that can of like, there’s a lot of places that are like beta lists and startup lists and places where you can post like free trials or free betas.

Loren:  This was for [inaudible]

Kevin:    [53:38] Correct. So, we ended up launching our Android app on product hunt, but before that we launched with [inaudible] didn’t exist. And so we basically went and loaded up a bunch of campaigns and all these startup places and we bought some very cheap ads. Like, there’sa ton of cheap ads up there where you, if you have a new product that’s for beta or to try, for a few hundred bucks or 50 bucks they will post a little ad in their newsletter or post a little ad, and each of those would get, you know, a few hundred to a couple thousand new signups. And the key thing that we had is we had this notion of referrals. And so what we always told our subscribers when they signed up and said, “Hey, thanks for signing up. If you want to get moved up higher on the list, here’s your unique URL to publicize it.” And so we had some people that were generating hundreds of additional referrals by re promoting it to try to get themselves farther up in the list. And then every week we would add like another 50 people to the beta early on. And then we started adding a hundred a day and it started the scale. But using that notion of kind of scarcity got people to re promote it for us. That was the one trick that we used. That got us around, I don’t know, 8,000 to 10,000 email addresses before we finally went live.

Loren:  [54:46] It’s amazing how all of these things like the old refer a friend scheme or whatever, and also the marketing and the SIG file work. And sometimes it’s so overlooked, right? From a marketing perspective. Like, I know when I started using accompli, people would write me saying, “Hey, when are you available?” And I’d just immediately send back all of these times and they’d respond, “Oh my gosh, how’d you do this so quickly?” And then I’d just be like, “check my SIG file.” And then like you know, Yahoo mail, Yahoo sports, all of that launched off of emails SIG files. So, it’s very overlooked, yet something that— it’s a marketing space that people are seeing on a daily basis.

Kevin:    Totally.

Loren:  [55:34] Cool. Alright, if you wouldn’t mind, I think you have one more slide in your deck, which is about our next presentation. So thanks a lot, Kevin. I appreciate you taking the time and I’m sure the SEJ marketing Thinktank does as well. We got a lot of great questions in. If we didn’t get to your question, we’ll be answering them afterwards and sending out that email accordingly. Just to also remind everyone we will be placing this video capture of today’s Thinktank on our YouTube channel, as well as doing a recap on search engine journal itself.

[56:11] So again, Mr Kevin Henrikson. Thank you so much. Really appreciate you making the time out of your busy day to be with us today. And everyone stay tuned for in two weeks, on October 5th Kelsey Jones, executive editor at SEJ is going to be doing a webinar on how companies can utilize Snapchat for social media marketing and other ways as well. So, we’re going to shut things down here today at the Thinktank, just to remind everyone that’s still with us, right after we end the presentation there will be a short survey. Please take the time to fill that out. Any feedback that we receive helps us make this better in the long run. So one more time. Thanks again, Kevin. It’s been great.

Kevin:    [56:55] Appreciate it. Thanks for the invite. Take care. Bye Loren.

Kevin Henrikson

Kevin Henrikson interview on the Shoemoney Show with Jeremy Schoemaker.

Interviewer:  [00:11] Hey everyone, I’m just switching over to my camera’s here. I don’t know why I picked that one up first. Welcome to another Shoemoney show. I am— let me sort out some things here. Oh, nothing never runs smooth. I swear to God. Let’s see here.

[00:59] Okay. So my guest today is Kevin Henrikson, and Kevin is one of my favorite people on the planet. And I routinely talk about, there’s a handful of guys in this industry that I super, super trust and I mean like literally a handful, and I get a lot of them on the show cause they’re good guys and they make great things. Kevin has a crazy successful story in that he was one of the founders of an email application that was free on the Apple store and Android store and I’ll let him tell the story. Kevin, welcome to the Shoemoney skills that pay the bills show.

Kevin:            How are you going Jeremy?

Interviewer:  It’s going fantastic dude. I think— just thank you so much for doing this. I know you did my radio show, which seems like a couple months ago. And since then we got like sponsors and stuff that wanted video. So you know, webmaster radio was like, “well we can do video.” And I was like, “Oh, okay, I’m not going to give you giant cut.” So anyway.

Kevin:            [02:13] Well I think the, I mean the setup, I was going to say going to say the software is incredible, right? Going through process to pick it up and then it opens up three clicks later, it’s probably one of the simplest [inaudible] use this for work, man. I mean you go look at the way you do presentations today or you set something up. This was super easy. And you know, video quality is incredible.

Interviewer:  [02:31] Yeah. And so this is WebinarJam, and I’ve been using this for since we started doing this and it’s you know, Andy Jenkins did it as a a typical am launch do millions of dollars in a week. And then you know, but the thing was, it’s such good SAS software that like, over the last two years they’re up to like 30,000 paying customers.

Kevin:            [02:59] That’s incredible. I mean, you can see why. I think it just works. I mean I love the fact that it’s based on Google so it’s going to work wherever and it’s like the video tech is going to continue to get better without having to invest in that. So I think it’s a smart approach to it.

Interviewer:  Yeah. They’re going to roll out very shortly a version called a WebinarJam HD, which is going to allow you to use Amazon streaming services and will simulcast into every platform that will do live. So like Facebook alive.

Kevin:            [03:30] Oh wow. So you can basically fork the same conversation into all the other like platforms and basically spin them off into whatever makes sense. Can you do like vines and stuff? Like, take like little clips and you [inaudible] that like a live editor grabbing like cool little loops and like busting out vines. That’d be a pretty sweet.

Interviewer:  [03:45] It’s actually like, I’ve seen some of the stuff of it, but the only issue with Google Hangouts that people have made remarks about is that there’s a delay. So like, if someone asks a question or Anna puts something in there, it’s going to be about 20 seconds, 30 seconds before they’re going to hear the answer to that. Whereas with like Amazon streaming services, it’s about a one second delay.

Kevin:            [04:10] Okay. Okay. Got it. So you can make it more real time cause yeah, I guess that would, if you’re really trying to have a really high bandwidth conversation two or three questions a minute makes it a little tough to kind of go back.

Interviewer:  [04:20] Yeah. And it’s interesting because people like, I was in Arizona in one of their technical calls the other day and they were talking to someone about like go to meeting, go to webinar. And they were talking about the technical hurdles versus them is like, obviously they built out a lot more interactive stuff, but in addition to that it’s got like, they were talking about webinar go to meeting does two to three frames per second where this, you can’t do real video over that, whereas this is obviously like 27 frames per second or whatever standard it is. But yeah, it’s pretty cool. You know, like we can put up polls, we can put up like, we can put an offer on the side if we want to sell something. Marketers usually shout a bit. But yeah. So anyway, I really, really appreciate you coming on. And so do you mind just giving a— like a lot of times I don’t have people like go too much in background, and my listeners know this is a lot different than like the show webmaster radio and stuff, because it’s not about like how to learn how to make money online. It’s like if you want to listen to people who have done it and been successful and hear their bullshit about stuff. That’s the fun.

Kevin:            [05:37] Yeah, no, that’s cool. Yeah. So you know, I got to school in like the early two thousands when just the internet was blowing up and I think I was a mechanical engineer by trade, but decided to do this software thing and stumbled onto software and had been working at startups primarily in the email space for like the last 15 years. And most recently co-founded a company called Acompli, which was a mobile email app for iPhone and Android. And Microsoft acquired that about a year and a half ago. And today it’s now outlook for iOS and Android. And so today I run the the mobile and the Mac team for outlook. And it’s been a crazy ride and I think so bouncing between little startups. Before that I did work at a company called Zimbra, which similarly was an email SAS startup that got acquired by Yahoo. And then subsequently VMware, it actually got sold twice, and learned a ton about email and startups, and it was great. And then my wife and I started a company about eight years ago called Alpha brand media that was initially a side project and then became her full-time gig. And the focus there was really internet marketing and a variety of sites.

[06:44] And so kind of took a bunch of internet marketing skills that I’ve learned through that process of running small content sites and affiliate and advertising and how that applies to kind of launching a kind of larger VC back to businesses, right? So a lot of the things we did, I know you were helpful with our beta program with Acompli and you know, promoting it out to your fans and saying, how do you grow something and use some of the techniques that we had learned you know, as part of our growth process on the internet to how do you apply that to growing like a traditional product or even in this case, a mobile app, right? And what are the notions of virality and how do you get people to come back? And why do people love your product?

[07:22] And so one of the things I’ve focused on a lot recently is around how do you get better, right? So we have over 40 million users use outlook today on their phone, on iOS and Android and we’re adding over a million users a week. But as that happens, with that size of an audience, how do you learn? how do you get better? And so building systems where we can basically collect that user feedback but use that as part of our product development process. So every week releasing new features, but using that kind of, almost thinking of every week as an AB test of making small changes, listening for feedback, and then making changes again and kind of constantly following that process to continue to release better and better product week over week.

Interviewer:  [07:55] Yeah, I mean, like it’s crazy. And so for those, I mean, the number obviously that gets everyone’s attention is you guys sold for $200 million.

Kevin:            Yeah. That’s what the press said.

Interviewer:  You’re not allowed to confirm or deny?

Kevin:            I do not confirm or deny.

Interviewer:  Yeah, my man.

Kevin:            The press was very accurate.

Interviewer:  [08:16] Okay. There you go. There you go. So yeah, I think it’s an amazing story. I mean, first you were involved with Zimbra, right? Was that like your first like entry level into the mobile space?

Kevin:            [08:31] Yeah, I think that was the first time I’d worked in mobile [inaudible] and I had done some mobile stuff, but it was really for feature phones. And so moving into Zimbra was the first time we kind of did really email. And mobile there was still pretty nascent, it wasn’t that popular. And we presented Zimbra at the very first web 2.0 conference. So JavaScript and Ajax. So it was really about bringing the power of the browser back to applications. And now of course you go to most applications and they’re incredibly rich with Java script and incredibly full featured applications on the web. And I mean, Google is kind of showing some of the amazing stuff that you can do in the browser and Facebook and all these apps today that have incredibly rich you know, full-fledged applications running inside of a browser, which is incredible.

[09:13] And so Zimbra did that. And then we also had kind of our first lead into mobile, but again, mobile was still pretty early there, right? The iPhone launched when we were running Zimbra, right? So there was no iPhone when we started Zimbra. And so as part of that, the iPhone launched and we were one of the early you know, companies to support the iPhone for email and learning how that worked and learning those skills. And a lot of that kind of experience accrued to the point that when we decided to leave VM-ware and start Acompli, that we knew that mobile was kind of the next thing, and we figured starting from scratch and writing a client that was designed for heavy email users and even casual ones, but really people that really wanted to get the most out of email on their phone was a great thing. And Microsoft agreed with us and then and it was aligned with the vision that they had for outlook going forward. And so it worked out really well.

Interviewer:  [10:01] Yeah, it’s perfect. I mean, how much did they change because it was integrated with Dropbox and all that? And I mean—

Kevin:            [10:06] Yeah, so all that’s still there. So like, we’ve really added to the feature set. In fact, we really expanded it shortly after we were acquired, Microsoft acquired another company called sunrise, which was just incredibly designed, like really polished calendar application, the top [inaudible] application on iPhone and Android. And we were able to take that team and merge it into our outlook team. And so now we have this combined incredible design talent with these great calendar features. If you think about it, you know, the goal for outlook is how do we get to hold the use, right? Like when you wake up in the morning, you grab your phone and check email. You know when you go to the office, you may use a browser, you may use outlook on your desktop, and then in the evening or on your computer, commuting the train, or you’re riding transit or whatever it is, or you’re at the dinner table checking emails, you’re back to your phone, right?

[10:47] So the idea is like this idea that no matter where you are, the interface, your email is the same. And the features that we initially started on mobile and some of the ones that are on desktop are now cross-pollinating. And so things that you know, made sense only on mobile. We just launched focus inbox. We took this crazy cool feature called interesting calendars from the sunrise team. So now you can go into outlook and add like all the Olympic teams, right? So like you can say, “Hey I wanna follow badminton”, or “I want to follow this particular swimming race”, or “I want to watch the opening ceremony” and it’ll instantly overlay those events on your calendar. And so you can schedule, it’ll basically block your calendar so you can go watch Olympic games. And we added it for all the popular sports as well. So NFL, baseball, basketball, etc. So you can add your teams. And so those can block on your calendar and they’re there for you to look at that, which is pretty sweet.

Interviewer:  [11:31] I mean, it’s awesome. I’m a big fan. I mean, Kevin, me and you have been on some adventures. And it’s been, I mean, it’s really, really been a lot of fun to get to know you a lot. And I mean, you’re such a fascinating guy from day one that I met you. I mean it’s just so interesting to see like from the first time you ever went to the elite retreat, and you went to the first—

Kevin:            [12:03] Yeah. In San Antonio, that was in 2007, something like that. Almost 10 years ago. It’s coming up on the 10-year anniversary, I think, or something like that, which is incredible, right? I mean yeah, it was great. It was one of your first conferences, I think it was the first conference you ran for this kind of an event, really small intimate conference. And I met a bunch of great people that I’m still in contact with, which is cool, including yourself. I think we’ve done a bunch of events since there together. And I think it’s been incredible to learn not just the way you grew your business and the way you’ve built your companies and sold your companies, and then how do we kind of compare notes and sort of “Hey, what you’re doing?” which I know we constantly ping each other for advice and I’d love to reach out to you and say, “Hey, Jeremy, what would you do in this situation?” or “you’ve been on all these crazy trademark things and you know, cool experiences with interesting legal and cases” that I think you’re super transparent around. That was one thing that I think I valued a lot as part of the elite retreat in early days and just meeting you, is that you are incredibly transparent with how you build things and how things worked, and how they and how you achieve success and where you failed, right? And I think you end up learning a lot from both of those. And I think that’s been incredibly insightful for me and something that I’ve continued to cherish and leverage as I move forward and say, “Hey, what would you do in this situation?” I think both of us kind of having those shared experiences sometimes in different technologies sectors, but in the end, both trying to just build successful businesses and finding ways to add value to the users.

Interviewer:  [13:32] Yeah, I think it’s amazing. Cause I remember when I first met you, it was in San Antonio like you said, and you were like, “Hey, Shoemoney, I want to talk to you about something”. So you showed me this Google campaign you were doing, which was absolutely brilliant and that you were running very well. And it was just you were buying paid traffic and doing this affiliate offer. And I do remember what it was. But I don’t know if we want to say what it was. It wasn’t anything like crazy sketchy, right?

Kevin:            [14:01] No, no. We can talk about it. It was running ad-words. I mean, it’s been long enough now that the algorithms are disabled now. But the motto was Google had this affiliate offer. It was before it was really even called [inaudible] like a product offer or something, it was Google pack. And so you could download this Google pack and included like, I think it was before Chrome. So it was just a toolbar extension for IE, it was Google search. It was a number of things that you could basically add on to what you’re doing and an enhance your PC. Google earth was another one. And what we found was that a lot of the people that would want to download Google pack would want to use Google earth. Google earth was had just been acquired.

[14:41] The company had just been acquired by Google. And so what we were doing was just simply advertising in very simple terms and found out that the word earth, which you could buy for a nickel, converted incredibly well on ad-words to folks to download the Google pack, and they would pay you, I think in the US I think at the time they were paying you $2 for install. And we were buying the word earth for a nickel. And so $2 to a nickel with a very high click through rate made a quite a good little business for a while there. And it was really fun. And yeah, now fortunately they shut that program down and they don’t have— They ended up buying DoubleClick, right? and moved it to Performix, and a bunch of changes happened on that side and now you know, that that whole program doesn’t exist anymore.

Kevin:            [15:20] But it was incredible times. I think a lot of these kind of call them internet fads or whatever they were, if you’re there at the right time and find the right connection, it’s really incredible. And I think I’ve always thought about how do you leverage that experience, right? Where when you find something that’s working, you just push on it, right? And in our case we really scaled up the campaigns and pushed on how we were working hard and it did really well for us for many, many months there.

Interviewer:  [15:44] Yeah. Sorry about that. My nanny and my kid are going somewhere, and they wanted money and I was like, “I don’t even have my wallet”, but that’s the fun of doing a show live.

Kevin:            [15:56] I was like, I was going to say I should have just done this conference walking around the office or went down on markets. I’m in San Francisco, so I can go down to market street and just interview some man on the street kind of stuff and get some opinions of the folks running around on market this afternoon. But I figured I might lose my Wi-Fi we’d really be testing this thing over some bridge LTV, which wouldn’t be as interesting.

Interviewer:  [16:15] Yeah, that would be interesting, how it would perform over LTV. I mean, I think, I think Facebook— Facebook fascinates me and also makes so much sense at the same time. I mean, a lot of people didn’t get the Instagram acquisition and stuff, and I was like, “man, it’s just about real estate. Their userbase.” And when they did the live thing, it was like, Yeah, okay. What was that Periscope? Okay, bye Periscope.

Kevin:            [16:44] You basically— they have this— like they just announced, right? They have over a billion users on the platform and I think almost a billion or just over a billion mobile only users, which is incredible, you know? Yeah. Something like that. It’s an incredible number, they have a billion mobile users, this is an incredible number of users. And to me this is just this platform that they can build on. So things that they do launch are incredibly interesting, right? And how they keep you interested, right? And if you look at the way that Facebook has kind of evolved, you know, from purely a time-wasting thing to like catching up with your friends, to like time wasting with games, to back to like drifting off into like keeping connections.

[17:23] But I mean, the core value is that richness of that social network, right? And the number of people and the diversity of the people that you would have lost touch with, right? Like my high school reunion, or college kind of get togethers would never have been the same if we never built those networks. In fact the Facebook wasn’t around when I was in high school, right? So we built that after the fact, but the fact that that got built and that now when we can have reunions, you can just go and announce it and list it, and connect to people. And it’s really the power, right? of kind of software, and just kind of SAS in general. And that’s like the social version of [inaudible] And you talk about how do you go build something that’s reachable. [inaudible]

[17:59] And you look at what we built on the phone, right? I mean, we put this thing out there and it’s in a hundred countries, right? 90 countries. I mean, it’s incredible, right? Like the reach it has, and millions and millions of users are able to see it. And I was just in China earlier this month— last month, I guess, in early July. And we’re building a team out there, which is incredible. But some of the things that we’re seeing that they have, right? you you’ve probably heard of We chat, right? And like this kind of chat mechanism, people use it in the US for messaging. It’s like a WhatsApp or Facebook messenger here in the US, but when you go to China, it’s used everywhere. And the thing that was incredible about it was that the trust factor that they’ve built. Like Facebook has this notion of like, “well I’m not sure what my privacy settings are if I post this, I’m not sure who’s going to see it or not.” But in WeChat it’s incredibly favorable to the user. So like when you even connect with somebody, you say, “I’m just connecting with you or I’m connecting with you and I’ll share.” Like, it’s a very binary thing upfront where you can make that decision.

[18:56] And so one of the popular use cases, you walk into a store and you think of like, “Hey, let me sign up for your Safeway card or your Starbucks card or whatever.” No, in this case you just go in and you connect the store with WeChat. So each little small business has WeChat and they encourage it, right? Like if you do this, I’ll give you 20% off and if you pay with WeChat I’ll give you another 10% off, right? Because they’ve built that connection as a marketing. They have like little hyper segment and marketing. They know what you bought and they can track you. But people do it because they’re trustworthy, that they know they’re just connecting with that store. And they know that they actually don’t get your information, like they don’t get your phone number or your email, they only get your WeChat like ID, which is a single token that’s just for you, for that connection to the store. So like, that token is not useful if they sell their business and buy a new one. They can’t take those tokens. Like it’s just good for that instance. Which is very different from the way that we would like sign up for a Safeway card or Starbucks card. Because I have to get my phone number and my email and like, if they go get packed or lost or bought, like that data’s gone, right?

[19:51] And so yeah, so I think we chat has been something that’s just total random tangent. But it was something that was incredible on my visit that I saw that, and then I saw the popularity of DiDi, right? That now they just announced last week, or this week I guess, that now Uber China’s going to get sold to DiDi and they’re merging, right? And so I use both DiDi and Uber and you know, DiDi was just more popular, right? And it was like very clear, right? And the drivers were saying how people were aggressively paying the benefits and the kind of kickbacks and promotions to get the drivers to drive more or use one of the other platforms. And so that was also pretty— Seeing and then to get that, to have that news announced a couple of weeks after I came back that Uber was actually going to pull out of China essentially by merging with DiDi, but I guess it looks well for the rest of the company.

Interviewer:  [20:38] So Didi is like, that’s just a overseas thing? 

Kevin:            [20:43] It’s a local Chinese company that basically launched Uber, right? Think of it as Uber for China. And they’re really— They actually were really smart about it. So they launched in China, and they went and invested in all of the competitors of Uber around the world. So they invested in Lyft, they invested in Ola, invested in all of the national kind of second place competitors and all the various GOs. And then they went and competed head to head and raise billions of dollars just like Uber did. Not as much. I think they were valued at like 37 billion. Uber’s at 65. But they basically made a run for it in China.

Interviewer:  Billions?

Kevin:            Yeah. Billions. 35 billion. And then they basically— Yeah, it’s incredible. And then they basically you know, they were able to push Uber to a point that Uber decided not to compete and said, “Hey, just agree to be friends and invest in each other’s company” and now the merge is happening.

Interviewer:  [21:28] Agree to be friends. That’s awesome. 

Kevin:            Yeah, I mean, what are you going to do?

Interviewer:  Why isn’t Lyft friends? Why isn’t Lyft in the inner circle there?

Kevin:            [21:38] That’s a great question. I think in that case I think Uber’s just got a much more dominant lead. I mean, to be honest Uber’s winning everywhere except in China. DiDi was the only country—

Interviewer:  In the Midwest in the Midwest Lyft has a foothold.

Kevin:            [21:52] Yeah. It’s got to foothold. I mean, even San Francisco it’s got a foothold. But I was actually— I commute to work a lot of times in Uber cause thos Uberpool has become so inexpensive. It’s cheaper than parking in San Francisco these days because they’ve driven down the cost because you share ride and you split your ride with a bunch of other folks. I’m on the Uberpool. So I mean, like it used to cost, let’s say five years ago, to take a cab before Uber, a cab from my house to the city was about a hundred dollars. So 30 miles is about a hundred bucks. Then Uber black launched and it got it down to about 65, 70. And the new Uber X launched and they got it down to 40 bucks, and now it’s less than $10 to take Uberpool. Now, it takes a little longer, right? Because you may stop and pick people up. But if you think of that scale of like efficiency driving down from like a hundred dollars cab ride down to something less than $10, 95% – 93% discount over just a five, seven year period, right? This hasn’t even a decade. And you know, that’s incredible.

[22:50] So I think Lyft has been a big part of that, right? I mean, Lyft is out there competing, and you know, Uber was only over black and the whole Uber X thing kind of came, at least what it appeared to be, you know, Lyft was much quicker with the kind of community drip drivers and that model. And I think Lyft’s still very popular in the city. But I think in terms of like total ridership, I think Uber is just completely dominating. I know when I was in Omaha for the Warren buffet conference, last time I was out there for the shareholder meeting. Like, Uber was just kind of launching like a year ago, right? Or maybe it was two years ago, and now I’m sure it’s probably getting more and more popular as more folks are using it.

Interviewer:  [23:24] Yeah. Lyft has always been— Like Lyft kind of came to the area, they made a big announcement in the newspaper and they, It was like “we’ll put a hundred bucks in your account when you’re approved” they did this giant, I thought it was brilliant, boots on the ground. And I think they probably targeted a lot of cities with population between like a hundred thousand to half a million maybe. And so like they did it in Lincoln and we have no Uber. Like if you trying to use Uber, there’s nobody. They just did like this huge— And if I remember right, it was like an exclusivity thing as well. So they just got like so many people, and then so many people here quickly discovered like, “Oh, there’s no Uber, there’s Lyft.” And so just around here, you just get barely anyone ever mentions Uber. It’s always like Lyft. So I think that that is where a lot of like companies, like I think that that’s where Groupon started to go around.

Kevin:            [24:31] Groupon was the hyper-local, Oh yeah, for sure. And I think the interesting thing there is you wonder if there’s a potential, at some point Lyfts starts to come up and build a niche market for these smaller markets. But they do it in a way that’s incredibly scalable, that makes it a somewhat defensible, right? Cause it doesn’t have the foothold for Uber to come make that run at it yet. But we’ll see. Where my parents, where I grew up, and where my parents— In central California, and similarly like— you’d seen like a little bit of action on Uber, like if you’re on the freeway, you can catch one. It’d be like a 30 minute wait. And then over time it became like 15 minutes and now it’s like 12 minutes. It’s still not the one minute like here in San Francisco where you push the button, it’s like boom, somebody’s like they’re right here already, which is great. But yeah, it’ll be interesting to see how it can be. I love the technology, right? And the fact that they’ve been able to leverage, like it’s just this incredible app for today’s mobile phone and kind of a mobile user and so I’m a huge fan of just follow it.

Interviewer:  [25:31] I think. Yeah. I was looking at Groupon stock and some other things and it’s— I never even— I used to get forwarded Groupon deals all the time and I don’t remember, it’s been years since somebody has sent me one. They just completely tanked.

Kevin:            [25:52] Yeah, I don’t know. I mean, it’s a good question. Like, I know the stock was really down for awhile and they had some management issues and the team turned over there. But I haven’t really followed, I don’t even know where they’re at. I haven’t looked at it in a while. But you’re right. I mean in terms of hearing about them or what was the other one? Living social was the other one that was in that same space. Similarly, lots of flash deals and things like that.

Interviewer:  [26:10] I know that it’s going because the like, the [inaudible] guy from Omaha, we did a thing on there and they did like 7,000 units.

Kevin:            [26:22] So they’re moving products. Yeah.

Interviewer:  [26:24] Yeah. So I think I personally think Groupon failed one, they were too greedy from a money perspective, and two—

Kevin:            You think they extracted too much out of each deal? Like profit wise, like they were taking too much off the deals?

Interviewer:  [26:40] Yeah. I mean you kind of know my model. I wouldn’t have taken anything. I would have just like, I wouldn’t have taken any.

Kevin:            Just scale and get the usage. Yeah. 

Interviewer:  Right. Because most of these— I mean, these companies, obviously, I don’t know any of them that could possibly make money, right? It’s just honestly like to get—

Kevin:            [26:58] It’s [inaudible]. “Hey, I’m giving you a free sandwich in the hopes that you like my sandwiches and come back.” But like, yeah.

Interviewer:  [27:04] Right, right. Because they take a good chunk of it. So I mean, if it was me, and obviously it’s not, and it’s playing Monday, whatever the quarterback, I mean like, just my basic model would have been to give it away for free, get gigantic market share which they did a good job on that by their own, but then get super local. Like I’m talking, when I say boots on the ground, I mean like people walking into businesses.

Kevin:            [27:28] And in every small business and being like, “Hey subway, let’s go do this thing.” Or “Hey Jeff’s Deli let’s go this.”

Interviewer:  [27:34] Right, or like hey, local chain of subways. You know, let’s go into Cottington dental and you know, they’re going to give away X amount of teeth whitening, but they’re only going to do 10, you know what I mean? You can get so—

Kevin:            [27:47] Make it exclusive or have some kind of scarcity to it to drive that interest around it.

Interviewer:  [27:52] Right. And the funny thing is our newspaper, somebody developed software that obviously it’s not rocket science, but they sold it to like our local Lincoln, Nebraska. Called Lincoln Journal Star, has like, they are running like Groupon-esc offers.

Kevin:            [28:11] Oh, so some kind of white labelable SAS platform that they can run with it.

Interviewer:  [28:15] Right. Yeah. It’s just one of those things, [inaudible] had its day. I still use it, I just 99% of junk on there I just didn’t like, it doesn’t go anywhere, but you know, like buy $20 Chromebook or something, it comes like in this, basically like a pop can aluminum casing. And it might’ve been even power on. So I was just like, whatever.

Kevin:            It’s 20 bucks.

Interviewer:  Yeah, literally. What do I expect? You know, so whatever.

Kevin:            [28:46] I have a question. How’s the website doing these days? What are you guys doing on the website? On

Interviewer:  [28:51] Oh, it’s good. You know, with my like position in life it’s just more about like, I don’t write that much because— I mean, I’ll write when I have something to share with the world I think is a value, but it’s like the blog posts and stuff, I don’t post just to post, right? Like John chow has a bunch of, you know, ghost writers, guest writers and that works for him really well. For me it’s kind of like it’s my voice and stuff like that. And so I don’t— I used to back in the day like, because I was always learning new stuff and now a lot of this stuff is interesting, but you know, for the most part, it’s more of like a branding thing for me now at this point. I kind of feel like I’m in a position where as far as like me doing my own thing, I’m always going to— I just can’t help it. Because I mean, as of right now there’s a couple companies that I’m just working with, they’ll have me jump on calls and get— you known, like somebody is selling an SEO or they’re using this Facebook agency and they’re blowing like 10 grand a day, but they’re not, they don’t even know how to hold them accountable to anything. They’re like, “yeah, we’re spending 10 grand a day on Facebook.” And I’m like, “what kind of ROI you´re getting?”, “It’s brining a lot of people?” And I’m like, “okay, well let’s set up pixels, you know like—

Kevin:            [30:09]
Classic spray and pray, right? They have no idea what the model is and backing it out.

Interviewer:  [30:13] Absolutely. So as far as when you go there, it’s more like me branding, and also like it gives you access to our free program, which is, I mean, you saw it back in the day and it used to require people to buy web hosting to go forward. And that was because we were paying people to actually build their site. So now we’ve got rid of that, so we don’t pay you, but web hosting is not required. So yeah. So it’s like if you want to do a blogger thing, go for it. You know what I mean? So it’s kind of like, it’s been interesting to see the, like the web hosting refunds are like below 5% where they were up around 20%.

Kevin:            [30:57] That’s a great metric to look back at, the refunds as an indicator of how successful the project is.

Interviewer:  [31:02] Yeah, yeah. We get a lot of them. I mean, we have a very, very busy Google group from our users. I know there’s a lot of them that are live on here or will watch this. It’s great. I mean, it’s been really great to see all the cool stuff that people build, and I never build it as a, “you’re going to make, this is the thing”, but it’s like it’s there, and there have been more self made millionaires via WordPress platform than like anything else in the world?

Kevin:            [31:34] No, no, no, no. I mean, by far the website and again, we talked about this earlier, with just the internet being the scale of the world, right? And being able to like put up a website and you can reach anybody in the world. Like that’s pretty incredible, right? And I think you know, I know that when we started Alpha brand media, like early on, that was some of the interesting things we saw, is that we started to get these sites and write about sites, we were like, people were coming from all over the world, right? Like, yeah, there was US traffic or there is focus on South America, or this area, but the rest of the world is incredibly large. And as internet penetration reaches this, the level that it’s at now, it’s really good. And I think that we saw that again when we launched Acompli, right? Like, we had users on day one from tens of different countries, right? And that’s kind of cool. And now there’s probably upwards of a hundred, right? And I think the mobile kind of space and building mobile apps is a much higher bar, right? Than versus starting a website. But I think you can just see these kinds of things connecting together, and where that goes, which is, it’s really going to be fascinating.

Interviewer:  [32:31] So we talked about me, and like for me I kind of just like, I’ve got two little girls that are eight and 10 now. They’re outstanding. I know you, have a child now. And gosh, how old is your girl now?

Kevin:            [32:44] She’s six. So, she turns seven on October. So yeah. So just finished kindergarten and she’s in her camps this summer and hanging out and yeah, Brooke is amazing.

Interviewer:   Gosh, so fast.

Kevin:            Yeah, they grow up.

Interviewer:  [33:59] So yeah. So I mean like with me, like I’m in such a different position where like tomorrow I’m going to take my girls to the state fair. You know, today I took them, had breakfast, they went with me, I washed my car, and I was on like a conference call with one of these companies I’m working with. I’m just listening to their onboarding process of this SEO company. You know, I have a field day with that. Because I hold their feet to the fire. I asked the right questions, you know. And the weird thing is like yeah, they pay me a good chunk of money per month, and a lot of people would be like, “Geez Louise, you only have to talk to them for like—”, and I’m like, “yeah, but you got to realize like me on one call asking them the right—, these people are spending 10 to 50 grand, in some cases 100,000 a month. If I ask the right question or something that—”

Kevin:            You can make a much real difference, yeah.

Interviewer:  [33:53] Yeah, they’re losing— I have a feeling this one company that’s doing Facebook advertising for this other company is probably, I know they’re taking a percentage of ad spend, like 15%. They’re paying like a monthly management fee. So they’re probably, I think they’re probably getting paid like— I probably shouldn’t say this, but for sure. I mean, there’s like six companies I’m working with right now so, but people watch, people are going to guess which one it is. Anyways, I haven’t been too public about that. But right now, like when I sold [inaudible]program it wasn’t a huge windfall for me, but it was cool. But I was kinda like, what else do I have to achieve, you know? I’ve won awards. I’ve done this. I’ve put away a bunch of cash to secure my family.

Kevin:            [34:39] What are you doing to teach your daughters to act like you? Like, that’s one thing I think about a lot. You know, we each grew up the way we grew up and assembled into the life we are building companies and working in this space. How do you think about, or do you think about like, how do you teach these same skills to your daughters so that they can have this same kind of path? or at least have the freedom to make the choice that may or may not lead them down a path like this?

Interviewer:  [35:03] Yeah. So I have different views on this, like really different views, and I want to write. You know, my first book was [inaudible] my autobiography. The next one I want to do collaboratively with people like you and just all these successful people that have you know, money and probably weren’t brought up with a silver spoon, and write a book called “how not to fuck up your kids”. And so then, they may not be the— That’s a running title. Okay. I don’t know what it’d be called. Working title, right, exactly. So, my thought on it is like a lot of people are like, don’t grow up your kids so that they have this entitlement mentality and you know, it’s okay to lose and you know, all this. And I’m like, “No, you are a Shoemaker. You are the daughters of Shoemoney. Like, you deserve to have like—” Not because of me, but just like, I always thought of me, and this is going to totally sound egotistical, as like a chose, like I was chosen for a reason to put on this earth, and it wasn’t to exist, it was to fucking live. And you know all the adventures I’ve done between the legal system and all this other stuff, like I fucking lived. And you know, and my kids, I want them to know that, like they’re put on here for a reason. Like, I don’t want them to feel like that they have things coming to them. And I teach them all the time, you don’t get stuff because you deserve it or it’s fair, you get it because you take it.

[36:36] So you know, when my daughter was running for class president. Okay, she’s nine, right? This was last year. I was talking to her about strategically positioning things to where like, “Hey, who are the key leaders?” Like in your thing. Like, I’ll come in Friday and I’ll bring McDonald’s for everybody and I’ll have a discussion about “Oh, who’s voting for Juliet?” You know, like who wants McDonald’s like once a week, like just joking, but kind of like— My wife was like, “you shouldn’t do that. You should let things go.” My wife is a totally like “you go to school, you do this, you do this, and then you become an anesthesiologist and you get what you deserve and that’s fair.” Well, okay. And that’s great for her. And she followed the path and she got the reward.

Kevin:            Incredible doctor.

Interviewer:  [37:25] Yeah, she’s outstanding. And my wife is a play by the rules and you know, you get what’s this, and I’m not. I’m like, you get what you take out of life. And you know, I’m not a— Nothing’s fair, and I try to do that with my girls, is just— it’s hard for me to explain it like right in a second. But I don’t want them to feel like, to take anything for granted, or feel like they are special. Well actually no, I want them to feel like they’re special. I want them to feel like, almost pressure them—

Kevin:            [37:56] Yeah, but own it, right? Like you want to own that experience where they can come in and they can have the command to say, “Hey, I want to make this path” or “I want to be aggressive on this” or “I want to take an active role” or “I want to be more [inaudible]”.

Interviewer:  [38:05] I don’t want them to think like it’s okay to lose, it’s okay to fail. But at the same time I want to teach them my most valuable educational experiences was what a lot of people would consider failures. And you know, like, you can’t get that education if you don’t fucking try. And so, that’s like what I’m trying to instil in them. And actually it’s worked really, I want to give them, a lot of it is self-confidence. Like, they’re already doing some public— They’re totally fine with public speaking and doing stuff like that. And you know, I love their self-confidence because you know, when you’re comfortable with yourself and you’re comfortable with getting up in front of your class and giving a presentation or other stuff. And, I mean, that was something for me, even through high school that was very intimidating. It took me, I mean a long time to ever be comfortable presenting on stage. But you know, for them, I mean this is—

Kevin:            [39:02] But it’s so powerful, right? Once you can do that and once you take advantage of that and once you get used to it, like it’s an incredibly empowering thing both for yourself, but also for others around you, right? To say that, “Hey, we can go make this happen.”

Interviewer:  [39:13] Right. And whether they want, no matter what they want to do, I just want them to realize that every opportunity is there. So if you want you can always advance. There’s a book out there called, it’s about shortcuts, but it’s called something else. Something cuts. Smart cuts or something like that. But it analyzes like all of these like, how does a 25 year old kid get to become like this high powered person in this company, you know what I mean? Like smart cuts. That’s what it’s called. But you know, that’s what I want my kids to understand, yes, play by the rules, but you really get somewhere by recognizing when an opportunity presents itself and then take, seizing that opportunity.

Kevin:            [40:02] Yeah, I think it’s recognizing opportunities, being able to work hard to go achieve them, right? Cause a lot of them— I had this thing when I used to talk to students that were looking for their internships or graduated in college, and I was like, it’s one of these things, set of rules, right? Like you know when change happens, that’s when you want to work the hardest. When things are moving and things are fluid, you want to just take that extra work to sprint ahead a little bit and then more than often than not, you can come out ahead because you can put the extra energy in when things were a little uncertain, right? Where you get that passive notion where things are uncertain you kind of hold back and chill out, and then you end up four or five steps behind because somebody else who leaned a little forward during that and pushed a little harder.

[40:42] And yeah, it’s an incredible thing. We always think about with our daughter Brooke, how can you instill it and understand the importance of running a small business, or like customer satisfaction, taking care of users and you know, being customer centric and understanding what people need and yeah, it’s great that I always like to ask folks how they’re thinking about that, and what their view is on how they expect to be able to try to instill some of that same spark that we successful folks have like, that have had some success in business to be able to [inaudible] back into your children and say, hey how do they get that same advantage?

Interviewer:  [41:14] Yeah. I think I totally like misrepresented my thoughts and I need to actually put them on paper, because it’s not like— My kids work really hard. We have them doing chores and stuff and my wife—

Kevin:            [41:29] Do you pay them for chores or is there an allowance? Like, what’s your model for financial incentives around that.

Interviewer:  We have a chore chart, and they’re punished if they don’t do it. We don’t like give them— I mean, we buy them shit, you know? I mean, a lot of the shit that I buy them is because I want them to have it, not cause they, you know what I mean?

Kevin:            [41:49] Yeah. You need a new drone, or you need a new toy because they want to play with it.

Interviewer:  [41:54] Dude, when they were like four, I bought them like the Vulcan Nerf guns, which are like 50 Cal on the thing guns. Like I was buying all this crazy shit for you know, I bought them like the Barbie car that would cruise around.

Kevin:            [42:14] All the things you wanted when you were a kid you’re like, “I wish I had this thing when I was seven” or whatever.

Interviewer:  Yeah, you know, I got them hoverboards as soon as those came out. And you know, my oldest has had—

Kevin:            And you had any battery issues? I’ve always heard people saying they’ve had these battery issues with the hoverboards or whatever now.

Interviewer:  [42:32] No, there was one brand that actually caught on fire, and so then that was the big “they catch on fire.” But it was just one brand that did it. And then it’s weird because my kids actually like, I’m always on their ass because they’ll leave them out in the rain. I got them for them for Christmas, so they left them outside in the snow, and these things still work, these ones that we have.

Kevin:            Awesome.

Interviewer:  [42:56] Yeah, I’m really impressed.

Kevin:            You should just put them on the website and recommend them to people cause they’re like, this one works.

Interviewer:  [43:00] So this was a moment that made me super proud. My daughter like— My wife was like “you should teach Juliet how to sell stuff online.” And I was like, “okay.” So I think it’s still, if you go to Yeah, it is. So it’s, there’s my daughter Juliet. Okay. This was years ago. And okay, so basically like she sells, I had her do a sales video. Okay.

Kevin:            [43:36] Dude, that’s awesome.

Interviewer:  [43:37] I know, I had her do a sales video. We did a little copy and then there’s this buy button that goes to PayPal. So I post this like on Facebook. And so there are $15 with $3 shipping and handling. And I posted it on Facebook and it sells like 35, like in an hour or something like that. And so my wife is like flipping shit now and she’s like, “okay seriously, take that off, take it down.” And I’m like, “why?” And she was like, “it took her two weeks to make one.” I was like, “well I don’t know. What do you want me to do?”

Kevin:            That’s funny.

Interviewer:  “You wanted me to do this.” So Julia looks at me and says, “well we can buy them at target for $4.” And I was like, “that’s my kid, you can arbitrage this.” So we didn’t do that. She ended up making them and sending them out, but over a long period of time and my wife helped out, but I thought that was awesome that she like saw the angle of arbitrage right there.

Kevin:            [44:36] Yeah. You fill the orders, so.

Interviewer:  [44:38] Yeah. It’s funny that site. I couldn’t believe nobody had potholders. I guess it’s not a big thing. It’s funny cause in her your video actually like it says like “we’re raising money for the bums” or something like that. I told her what to say. Gosh, she was five years old when we did this. Anyway.

Kevin:            [44:59] That was what, four or five years ago? Three years ago?

Interviewer:  [45:01] Yeah. Well she’s 10.

Kevin:            So, so five years ago. Wow.

Interviewer:  [45:05] Me and time just— I would tell people this, I’m like— My parents always told me like, your kids, enjoy them cause they go so fast. Once they like move into the asset column you can have a conversation with them, they can get you a beer, you know what I’m saying? Like it does, just once you can do stuff with them. And one of my friends who, well it’s my godson, that kid went from like eight to 18 overnight. It’s just like—

Kevin:            [45:37] My daughter was, we’re at this amusement place and they had— It was in Tokyo and they had this grabber, like those grabber machines again, you see them in every mall, the crane machines. And she was like, “dad I’m looking, nobody’s winning. Like, who’s winning here?” And I’m like, “Oh, the guy that owns it it’s winning.” She goes, “well he’s not even here.” And I’m like, “that’s right. He’s not here. And he’s winning.” She’s like, “I got it. So he comes at night, he gets all the money, puts it back in and he can buy whatever he wants?” And I’m like, “and he gets first pick on the toys too.” And so now I’ve been investigating in it like you can go rent these machines their a couple of thousand bucks, you can probably buy them on eBay for $1,000. But I’m like, wouldn’t it be cool to get a machine and set it up and be like, “this is your little business. You load it with the toys you don’t want, kids come in and feed it a couple bucks and they can pick out toys.” But what’s incredible is I’ve been reading about it, there’s actually a setting on these things. It’s like a slot machine. How often do you want them to win? It’s like, basically the claw never works, and then you just set it from zero to 99 of how many weak claws, and then until it does a strong claw. And so it’s just this deep setting. You set the thing in the back and they said “we recommend about five to get people really happy and motivated, but if you want to milk it out, set it to 25 and the thing will only win one out of 25 times.

Interviewer:  That’s awesome.

Kevin:            It’s all about clustering. And so it’s literally like a binary thing. You’re setting it in there. How often. But I thought that was a great experience. So when she was like, “well, who’s winning here?” And I was like, “yeah, the person that’s winning is whoever owns this. He or she is not here.”

Interviewer:  [47:09] So, when you— Okay, so jumping— I’ve wanted to ask you, so I talked about my position where it’s just like what I want to do for the rest of my life, and really, my kids are my legacy. So I try to spend as much time with them as I can. And just yesterday I took my oldest at night or my youngest [inaudible] golfing, it was just me and her and whatnot. And so it’s just like, but you know, you are in a position better than me, like financially. But it’s like what keeps you motivated? I’m sure you have some sort of earnout to stay at Microsoft, or incentive or some part of that deal, I’m guessing.

Kevin:            [47:50] Yeah. I mean, the motivation is really about having fun, right? Like, I mean, part of it is you got to have fun with your doing. You have enough that hey, I can make my rent payment. Hey, I have the car that I want or whatever, and you know. But you’ve got to have fun with what you’re doing, and I think you could argue that, “Hey, you could just go home and sit at home and play video games all day” and I’m not a big video gamer, so that would be super depressing cause I’d lose all the time. But I think the bigger thing is you’re having fun doing what you’re doing. And I earnestly like building companies, I earnestly like building things. I love watching outlook grow. I love watching doing what we’re doing and watching the impact of what me and my team have, right? And I think—to me right?

[48:27] Think of it as like when you go to the gym and you work out and you’re like, “wow, I’m getting stronger. Maybe I’m able to keep score [inaudible]” so know, keeping score with how much money you make is one way. But I think there’s more and other ways to do that, right? I mean, what’s your project like? Are you hitting the metrics you want to hit? Can you set like outrageous goals and then chase them down? Right? And so I think the way I like to think about it is the right way to keep the motivation together is you need to make sure that you’re increasingly setting bigger goals, right? Like if your goal was, “Hey, just to get to work every day and get home by five and drink a few beers”, like that’s a goal, right? And there’s people that have that goal and like, “Hey, I just don’t want to work overtime. I want to make enough between nine and five to be able to chill out and hang out with my family”, right? And then you say, “Oh no, I want my goal to be even loftier, I’m chasing like some larger product thing, or I’m chasing some I want to have an impact on millions of users. Okay, well now Outlook is shipping to millions users. Okay, what’s the next change? Right? And I think, I don’t know, right? I think right now what I’m doing here at Microsoft is fun. Like, I enjoy what I’m doing. The team is incredible. We brought an incredible team with us from Acompli, had the sunrise folks join us, which was another gift, which was incredible. And now we’ve been able to hire really, really good people to compliment them, right? And so the team’s growing in a measured way with people we love.

[49:41] And I think being able to do things you love, and you always hear this like cliche thing with jobs, getting up in the morning and Steve would say, “Hey if you look in the mirror and say, ‘do I really want to do what I’m about to do today?’ And the answer is ‘no’ enough days in the row, you need to make a change, right? And I think right now I really love what I’m doing, it’s fun to be part of this. And I think I’m still kind of— As a father of, one of the co fathers of this app, right? You think of like, “Hey, we had this little app and it was our thing and we were there when it didn’t work right? And it was just one or two users, and then it went to tens and then hundreds and then thousands, and now tens of millions. And as that happens, there’s still a part of me that says “we’re not done”, right? Like, there’s still this mission, there’s billions of people in the world. There’s more than 2 billion phones. There’s more than 2 billion people with email. And so to have tens of millions of users using our app is we’re just scratching the surface.

[50:31] And so I think you just need to make sure that as you go through life and you reach success or goals or whatever you think was your initial version of success, that you need to challenge yourself or have the motion to keep learning, right? And learning is another thing, right? You really want to learn. Like it’s not just about like doing the same thing. And I’m still learning stuff every day and I am, right? There are new things that I come up with that I hadn’t thought of before, or perspectives. You know, a lot of it now is like, I could argue that I have heard a lot of things or I’ve seen a lot of things and I’m like, “Oh, I’ve heard that”, but I’m learning more and more to stop and listen. And you may hear something you’ve heard before but with a different perspective, and that’s incredibly enlightening, right? And you can actually learn stuff by just learning more about a topic that you’d never seen from that angle, right? And you never looked at [inaudible].

[51:17] For the same reason that when I go back to places, whether it’s an amusement park or a zoo with my daughter where it’s like, “Oh, I’ve been in the San Francisco zoo a bunch of times, or I’ve been to this museum. But then if you go there with a five or six-year-old, you have this incredibly different perspective and they notice things that you would never have noticed or you took for granted, and so I think a lot of that falls into work, right? Like how the perspective you have on your work and the way you approach it is less of like, “Hey, I’m just trying to get through it as quick as possible.” Like, enjoy the moment. Like, what are you doing? Are you having fun? The team you’re working with and— And having fun, are they having fun? If not, why? and can you go fix that? Right? And so I think it’s a very long-winded way to get there. But I think having fun and constantly learning.

Interviewer:  [52:01] I think one of the other things I want to talk about was I don’t think a lot of people realize the “more money, more problems” thing is real. Like, it’s a good problem to have, but a lot of times is like, how do you not lose the money that you kept, right? And so it’s like, I know you’ve talked about your strategy to be before.

Kevin:            [52:27] Yeah. I mean, I think so— The strategy, there’s lots of strategies, right? I think that—I’m a huge fan of productivity hacks and simplicity in life and lists and tracking things and like, everything I do, if I’m going to do it more than once, it’s a task and I put it on my to do list and I track it, and it’s recurring and I know that this thing needs to happen every 30 days. I set it to recur every 30 days and I’m overly diligent on that. I’m kind of [inaudible], people would say that I am right. Like in terms of tracking what I do and I have listened processes for everything. And so the way I think about finances and the way I think about investing is similar, right? So when I do angel investing, whether I’m investing in a small friend’s company or investing in something large, I look at it and say, “look, would I trade the hours that it took me to make that money if I lose it”, right? Is that a fair trade? And so putting that in the right perspective helps. But just being methodical, right? Like when I go on trips, like I have an app that tracks the hundred and something different things that I could possibly check and pack, and I make sure it’s there, and you know, to the point that it’s robotic, I just go through it and it sounds a little boring, but it also helps me be— It reduces anxiety, right? Because you don’t have to worry like, “Hey, I’m leaving for a trip and a couple of days,” no worries, I’m just going to bust out the app the night before, the morning of, and go through it and make sure I got everything, and half the stuff’s already packed so I don’t have to worry about it, because I’m always kind of ready to travel. Or at work when I’m going to kick off a project, I have a template for that and track through it. And similarly with finances, right? How do you track through kind of the strategy that you’re going to take?

[54:00] And the best advice I ever got from somebody, a mentor of mine, was “just don’t change anything.” Like the first thing you do, “Oh, I made something, or I made a big—”, don’t change anything. Like, I don’t need to go buy a new car or go buy a bunch of new clothes or go buy fancy sports tickets or whatever. Like, yes you could. But the first level is don’t make rash decisions. And so I think the ability to just not do anything, it is actually hard, right? And so I have to keep reminding myself like, “Oh, don’t go do that.” You know, I could take this extra vacation or buy something nice for my family. [inaudible]. So don’t, right? I think that’s the easiest part of this strategy, from explaining it, to don’t change anything, but it’s the hardest thing to implement, right? Because it is easy. And then you know, the number of people that are like, “Hey, you have ten, can you give me one?” versions of that that are sometimes comfortable and sometimes joking, and sometimes just uncomfortable.

Interviewer:  [55:02] How many people have you had hit you up for money?

Kevin:            [55:02] I mean, not counting like investment advisors and stuff, like tens and tens of investment advisors. But I would say like, I don’t know, I mean people— I think it’s kinda weird cause I am an angel investor, so I’m kind of advertising for people to hit me up for money. So I think from that category I discount those. But from a generic money requesting thing, I would say tens of people, not hundreds, tens of people like, but they all come under, they’re not just like, “Hey, give me $10.” They’re always like, “Hey, would you want to invest in stuff that’s clearly not an investible product?” Like, “Hey, I’m—” you know, they’re more like donations, right? So I think of it this way, people that are pitching investments that when you look at them, they’re really donations. Like that’s the part of it where I’m like, “um”. Those are the ones I categorize, people asking for stuff that they probably shouldn’t.

Interviewer:  [55:54] I mean, you’re in the hub of it all. Like me, that would be my ultimate thing that I would look at. I don’t know. I’ve always wanted to like— cause I know I enjoy the growth aspect of a company. I’m used to doing everything myself though, and I struggle with a team at times, unless it’s like [inaudible], I can get my hands in and do, and then they can do it right. And so actually that’s one of the things I’m going to do is fall, is take some PHP [inaudible] classes, just because my PHP is cutting edge for 2004.

Kevin:            [56:36] Yeah. We, we always call it, yeah, like the 2004 era PHP, or like before objects existed and you know, back when you had to [inaudible] yourself and yeah. [inaudible] Yeah. I mean, the learning thing is awesome. I’ve been taking some machine learning classes, which just picking things up that keeps you fresh, and even if you don’t use it everyday in your work, just understanding some of these modern concepts is interesting. And it’s great to kind of be in school again, right? Because even when— It’s like going to conferences, right? You go to a conference like, “Oh, I know everything about X topic”, and you know, you’ve probably heard of it, but it’s incredible to hear other people talk, and the number of ideas that just sparked from like, “wow, I should try that for this.” You make these kinds of connections, right?

[57:18] And so even when I go to my wife’s company, Alpha Brand media, runs this conference every year, right? And from her website search engine journal. And you know, time over time again I go to the conferences and I’m like, “well, I’ve heard everything about SEO or Facebook advertising” and every time, every speaker I learn something, right? I learn something or I find something that I want to throw a note down to go apply it to my business or a project I’m working on, or just something that’s just interesting. And so I think that’s a great way to kind of keep fresh. And whether it’s conferences or taking classes, I think all of those are really, really good ways to kind of keep yourself and not letting your brain rot.

Interviewer:  [57:53] Yeah, for sure. And you know, that that sparked a thing with me because I’ve gone to a lot of these guys, like whether it’s Andy Jenkins or Frank Kern or you know, even Anthony Robbins, okay? So you guys all like [inaudible] Like, Anthony Robins is mostly I’m talking about here. Like you can’t talk to Anthony Robbins, right? He’s on this pedestal appear with a rope around him. And you can talk to, you can be one of the peasants right around below. And also, he never talks money, right? So he’s just like that role. Whereas like in some of the info marketers, the bigger ones, they’ve always got to put themselves on a pedestal, right? And they don’t— If you want to talk to them, it’s like 10 grand to be a part of their inner circle or war room or double diamond platinum group or whatever you want to call it, right? Those things aren’t for me. You know me. I mean like, every conference I’m in the trenches, I always say like I’m a guy of the people or a man of the people or whatever. I love talking with everyone. I pound that expo hall and just— I mean like, John chow too, that dude is—

Kevin:            [59:02] Run into whoever and man on the street kind of stuff, and just see who you’re [inaudible]. I mean, that’s how we’ve met some of the greatest people we know, right? Is through that process, right? Or go to the bar hanging out at some after conference thing, the unconference next door type of stuff. And we’ve met many of the people we probably spend more time with today then the speakers or the people that were “famous” 10 years ago.

Interviewer:  [59:22] I saw a guy speak at Pubcon and this would have been like 2005. He went on stage and he talked about how there were all these domains out there that were expired but still had incredible links but just had expired, that weren’t registered anymore. And a lot of people were like, “yeah, but how many could there be?” You know, blah, blah, blah. Just easily dismissed it. And me, I built this like, basically a crawler of the internet, I added all these things and I found 10,000 plus, and we had an open marketplace that we sold them, and the best thing was is we were basically selling air. I mean, we didn’t own them, we just gave you the name. But sorted out like, if they had military EDU backlinks, like total backlinks, PR backlinks, whatever. So people would go in there and they would buy like 50 at a time, and that was back when Google, like a lot of them, I redirected like 400 of them one time at a sub domain of Shoemoney just to see what to do. And it was ranking for high poker terms, like really high poker terms. And it was because all these guys had made these sights and just turned and burned them, and then it occurred to me, okay Google bans sites, but I don’t think it bans links. So when you three o one them, like, they still carry the anchor tag, link juice, everything.

Kevin:            Yeah.

Interviewer:  [01:00:52] So, we’re running late here, and I also just got a text from you too. So we’re actually right on the same page. I really appreciate you coming on so much, and I want to catch up with you sometime soon.

Kevin:            I’m in Lincoln, or if you’re out in the Bay area, we got to connect and kind of go from there.

Interviewer:  [01:01:10] Yeah, for sure. I just just spent days out there driving up to LA and I thought about driving all the way up to San Francisco. But cool, man, I really appreciate everything. Thanks everybody for joining us and we’ll talk to you next week.

Kevin:            Cool. Take care of that. Bye.

Marketing for Startups & Enterprise: An Interview with Microsoft’s Kevin Henrikson 

At SEJ Summit Silicon Valley, Loren Baker talks with Kevin Henrikson about how marketing works when you’re in a startup and when you’re in an enterprise.

Loren:    [00:03] Hi, this is Loren Baker with search engine journal here at SEJ summit at the computer science history museum in mountain view. With me today I have Mr. Kevin Henrikson from Microsoft.

Kevin:      How’s it going?

Loren:    Good to see again.

Kevin:      Likewise.

Loren:    So let’s talk a little bit about marketing when you’re at a startup and when you’re at a larger corporation. Recently you were involved in an acquisition by Microsoft, correct?

Kevin:      [00:28] Yeah, that’s correct. So my company Acompli, it’s about 20 of us, got acquired by Microsoft about eight months ago. And yeah, there’s some changes, right? You know, the way that we kind of did things as a small company, more agile and probably less process in general, but there’s also some things that are harder, right? And it was harder as a startup trying to get known and get your name out and get your brand know, right? which obviously Microsoft has less of that problem right now, people have heard of Microsoft.

Loren:    And has an existing marketing machine.

Kevin:      Correct, yeah.

Loren:    [00:58] Back at Acompli, you were doing a little bit more of the scrappy do it yourself type, I mean you were involved with the marketing.

Kevin:      Engineering was very closely tied into marketing and how that worked. And so I mean, the product and the product team and design, all was kind of integrated in terms of how we market. And now obviously when you move into a larger company those functions are separated. I think the good part about it is as we’ve transitioned so far kind of from accompli into Microsoft and now, you know, being branded as Microsoft outlook the brand made a big difference in terms of, you know, pushing us up in terms of growth. But it also enabled us to go focus on other things around how do we provide the best support or how do we provide the best features and functionality for that as we go through.

[01:40] And then the marketing aspects of that are really about how do we really retain those users and how do we make sure they have a great experience kind of onboarding the app and kind of, you know, taking them from where they’ve already heard of the brand or the company and probably getting them into our app and getting them ontn their phone.

Loren:    So in the startup world, if you had an idea, would you basically just pull it off that day or take the time to plan things out, thinking about what may happen down the road with that campaign? 

Kevin:      [02:02] Yeah, that’s great. So I think the way we structured a kind of marketing and growth inside of Acompli was that we had a greater vision of like an idea of like, Hey, we want to go this way or we want to attain these kinds of numbers, or this is the kind of thing we do. But how we got there was super agile. We would just throw things against the wall. Does this work? Test it. If it works, run with it. If it doesn’t, kill it and move on, right? And I think similarly, if you kind of compare the parallels, at Microsoft we do have a greater goal. Like we want to hit a growth number, we want to hit a certain target. And as we achieve that, we still kind of break that down into smaller pieces. But many of those pieces aren’t controlled by our team, right? So we end up having other teams and partner teams that are working that are more, you know, they have more expertise or own that part of the process.

[02:42] But in terms of how we design and how we decide of what to go attack, we still try to break it down into small pieces because it’s just easier to consume and it gives you that agility to say, Hey, if something doesn’t work, stop doing that and go do something else. And so I think that’s worked well.

Loren:    So, Acompli is really a success story. You guys launched an app and everything else made it, with the acquisition part of Microsoft. Congratulations, of course. But what would you say is the one kind of digital marketing discipline that you think really worked for you all? whether it’s digital PR or content or SEO or just getting word out there about the app itself? Like what really hit it off?

Kevin:      [03:22] I think for us by far the biggest kind of impact or biggest lever that we had in terms of both growing Acompli as a company or brand is press, right? And I say press and that is kind of a broad thing, right? It’s like, you know, it’s people writing about you, it’s people talking about you on social media. All of that filters down from us getting— Nobody knows who you are as you’re a startup, right? And so when you make an announcement and say, “Hey, I’m here”, press has the biggest kind of reach, it has that set of readers. And so, you know, posting articles online, writing kind of controversial blog posts and getting those kind of pushed out into press or having people write about those was the best way, and I still stink inside of Microsoft, I think a lot of that is, you know, obviously the press machine that Microsoft has is larger, right? I think that helps in terms of the width of what we can do. But at the end of the day, press was by far the best thing. It was the most impactful on both our company and our brand and kind of the app itself and user base.

Loren:    [04:16] Yeah. Which is really interesting, especially in the world of startups because a lot of the time when I’m looking at a website or an app that got their initial tech crunch, VentureBeat coverage around their investment or whatever, you see a blip and you see a little bit of traction and then it kind of dies off, right? And then it’s like next time there’s funding a blip again, right? Cause they get on tech crunch again, and then it kind of dies off. So do you think that kind of cutting through the noise with the press coverage that you had and those types of blog posts and everything else really helped you maintain?

Kevin:      [04:46] It did. I mean, for sure when you would get an article you would get a blip. And I think the thing that we realized is that the getting that blip is hard though, right? You know, the blip is huge and it’s impactful and it’s awesome. But getting those is hard. Nobody wants to write about you every day, every week, right? And so doing meaningful and impactful things, and so grouping features or grouping kind of chunks of releases into something that’s pressable, like that you can go put, you know, have actually a press event around, made sense. But for us it was really like, “what’s the story like?” You know, it’s a small team building something new and we’re attacking a space that’s very old. We were going after email, right? And like it’s been around for everybody. There’s already hundreds of competitors out there. What made us different? and what were we doing differently? And so it’s not just like, Hey, I’m doing something and funding is great, but why are you getting funding?

[05:33] Lots of people are getting funding. Like there’s lots of startups in the Valley. Like how is yours different and how is yours unique? And it was like, and being able to craft that story and have like that sound bite that you can talk to a potential writer or reporter about where they can say, “yep, I got it. Makes sense. This is why you’re different.” And then that’s why they wrote the story, right? It’s not because, “Hey, we just want to get press and we go get it.” Right? Because otherwise you get the one blip and never come back, right?

Loren:    You tell a good story and people want to retell it.

Kevin:      Yeah, exactly. And then you have that story that threads through and like, here’s the next chapter of the story. Remember at our last meeting, this is what we’re going to do. And then kind of going back and forth and that allows you to kind of get that rhythm, right? It’s like, you know, Peter, our CEO used to say it’s like the drum beat, right? And then you just keep hitting bigger notes, bigger notes, bigger notes, and you’re working with a base cause now you are starting to get known. But then so how do you make those next ones bigger, right? And how do you make it more impactful? Yeah, there you go. That’s a great way I think to think about how you work a press strategy, is have a story to tell and you know, and get people interested in what you’re doing and less about like, “Hey just go write a story.”

[06:38] Because nobody, you know, you’ve been publishing and writing for years, right? I mean you have to have something that cuts through the noise and is impactful enough to get that kind of signal to go after.

Loren:    Cool. So Kevin, where can we find you online, and the SEJ audience? Where can we find you on Twitter?

Kevin:      [06:56] So, on Twitter @KevinHenrikson, just my full name. And also on Facebook, and so you can probably look me up. Twitter is probably the easiest, less noisy. And we’re good to go. So thanks again for having me. I appreciate it.

Loren:    Very cool. Thank you. Thanks a lot.

Loren:    [07:11] Hey kids, this is Loren Baker with search engine journal here at the SEJ summit in mountain view. With me I have Jim Christian, they head of  SEO over at GoDaddy. Welcome Jim.

Jim:          Hey, thanks for the intro. Appreciate it.

Loren:    You might wonder what we’re doing sitting in a car. Well, this is no normal car. This is actually a Google self driving cars.

Jim:          It is,

Speaker:  [07:31] The SEJ summit is one of the better conferences I attended, the speakers are fantastic. the weather here has amazing. I mean, just the location, the hotel.

Entrepreneur, Angel Investor, Engineer, and Speaker – Kevin Henrikson

Shoemoney Show: Entrepreneur, Angel investor, Engineer, and Speaker Kevin Henrikson talks to Jeremy Schoemaker about some of the highlights of his career including how Microsoft bought his Email App venture Acompli For 200 million dollars and before that the sale of his company Zimbra to Yahoo.

Jeremy: [01:15] Hey everybody. What’s up? Today is April 7th, 2015. I am Jeremy Schoemaker, known on the internet as shoe money. And you are listening to the shoe on a show on webmaster radio, also available on iTunes, Stitcher, and all the other places I can’t pronounce where you can download podcasts. With me today is Kevin Henrikson. One of my friends that basically I met because he attended my first ever elite retreat way back in the day. Kevin, what year was that?

Kevin:    2007 or 2005? I don’t know.

Jeremy: [01:50] Yeah, I think that was, I think that was—

Kevin:    It was almost 10 years ago. Yeah, we can look it up. In San Antonio, right?

Jeremy: [02:01] So you want to listen to showcase, Kevin just sold a company for 200 million. All right, Kevin, give us a little bet just in case people are like, “Oh, they’re just going to bullshit around.” Okay. So Kevin, give us your background and why you do, I’m not gonna pay attention. I’m actually look that up. Go ahead.

Kevin:    You’re going to look at my background or look at when you did the—?

Jeremy: No, you talk about your background. Dude, this show is so well thought out.

Kevin:    [02:22] Yeah, I’m glad we started this right off, right? So, no, I’m cool. Well, Jeremy, thanks a ton for having me on. I mean, yeah, Jeremy and I had been friends for a while and yeah, he was a customer of this elite retreat. But so I’ve been in the software kind of world for a while, kind of internet software, just building software. Worked at a couple of startups mostly around mobile and email. And most recently co founded a company called Acompli, which was a mobile email app for iPhone android, and Microsoft acquired us towards the end of last year, and now we’re outlook. So if you can go download our app, it’s outlook on iOS or Android and yeah, it’s awesome. And I’ve had a great time kind of building various kinds of email and internet-based software platforms for awhile. And also built a company with my wife called alpha brand media.

Jeremy: Do you guys own Search Engine Journal?

Kevin:    Alpha brand media does own search engine journals. So yeah. So that’s the kind of the flagship site. And my wife’s the CEO of that company, and kind of where I kind of have this cool mix between kind of a day job of building software and kind of the VC backed Silicon Valley world of building software companies, but then kind of have this other business that, like I said, my wife now runs that was really focused on the internet publishing and we had at one point had over 300 websites that we had just started acquiring tons of sites in 2008, and have this kind of just kind of attraction to doing ads and publishing and kind of how blogs work, and all kinds of cool affiliate stuff.

[03:59] And it’s amazing the kind of things that you can take from the kind of traditional internet marketing world and how that applies to building a traditional kind of VC backed company in the Valley here. And I think a lot of the cool things we do with Acompli and Jeremy helped us like building our beta list out and just tons of things that we were able to do and kind of little growth hacks, and I hate that kind of term, but little tricks and things that you learn along the way in terms of how to apply that to your everyday business, I think was— I learned most of them in internet marketing and you know, meeting the folks at the various elite retreats I’ve been to was super helpful in my last couple of companies.

Jeremy: [04:38] This like I didn’t know. It was just like, “Hey, let’s have an event, let’s charge people $5,000.” And you know, and everyone was like, “Oh my God, these guys are insane.” But it worked and it was cool, and you’ve seen it evolve over the years. But the interesting thing was is— is this still hard to hear me?

Kevin:    No, it sounds fine.

Jeremy: Okay. I don’t know. Yeah, let me look at my settings real quick while we do that. Because when my headset cuts out, sometimes my computer wants to take over to listening. So anyway, yeah. But Kevin is like, blew me away. Because he comes over and he’s like, “dude, check this out.” And he’s like showing me this stuff he’s doing and I’m like, I mean it was really, really, really genius, and I was like, “Hey, I wouldn’t be showing many people this.” I think that was my initial thought.

Kevin:    [05:30] Yeah, exactly. You’re said, you’re like, “have you showed anybody else this?” And I was like, “no, you’re the first guy I met with today”, because we were doing these little talks. I mean, and the whole elite retreat thing was like I kind of— I don’t know how I stumbled upon it. I think I was just toying with kind of putting up websites and blogs and playing internet advertising, just seeing how that worked. And I saw this thing and it was like, “Oh, to meet with some people that seem like they’ve been doing it for a living.” I said that’d be cool. And I didn’t have a ton of time, right? I was working full time at a startup and I said, “well 5,000 seems like a ton of money, but I’d much rather do that and show up for kind of two days and kind of fire hose.”

[06:06] And it exactly was that right? It was just a completely different deep dive into that world and yeah. I mean we chatted about some of the cool stuff I was trying with at the time and yeah, it ended up being a quite a little project. And like I said, I learned a lot, right? I think one of my favorite lines I was coined from back then was like, PPC is free, right? Like as long as you have the right ROI model and as long as, if you’re spending a dollar and making a dollar and one, then you’re doing it right. And so it’s silly how people that are in kind of affiliate or internet marketing or doing paid search, you obviously know that you live and die by your tracking and how accurate your stats are, and are you building ROI, and can you detect fraud or if you’re getting triggered by fraud alerts or anything like that.

[06:49] Man, that makes so— that was like probably the biggest thing I learned through that whole business and running that kind of project was that now you look into thing and you’re like, “why would you build anything without the right kind of metrics or statistics or analytics in place?” And like you see this whole movement with data scientists and data engineers and people doing deep kind of insights into like the big data. And I’m like, “man, that’s just, you have to do that”, right? If you’re building something and don’t know how you’re winning or why you’re spending money and not tracking it’s just like this, you’re flying blind, and especially when you’re doing the companies. Yeah, it’s good.

Jeremy: [07:23] It also had like, I just met with this company, it’s a half billion dollar hedge fund and they have this new startup, and this new startup is like in this first six months, it’s profiting six figures a month. And it’s a really cool concept. I don’t want to say who they are because they’re— Hopefully they don’t listen to show, but they’re not— But I mean, like as far as like complimentary there, I mean I asked them “how many visitors you get?”, because they came in through because they wanted the par program and they were referred by a large investor. And I kind of qualify them, “how much traffic are you getting?” And the guy’s like, “Okay, hold on, let me pull that up.” And he comes back and he’s like, “1,000,307” you know? he’s like ranked a site in the world. And I’m like, “where in the fuck— are you reading Alexis stats?” And he’s like, “yeah.” And I’m like, “No, no. I mean like from your Google analytics.” And he’s like, “Oh, it says we have 2.7 page views per person. Is that what you need?” I mean, literally that’s the CEO of this company. And it’s a company that’s making, profiting over $1 million a year.

Kevin:    [08:34] But I think a lot of that is you focus on the thing, “Hey, it’s making money, let’s keep going.” And then some people never go back and add that. And you know, part of it’s just that “if it’s not broke, don’t fix it.” But it’s amazing. Like when you see stories like that and you’re like, “well, what if you were tracking that and what if you were looking for opportunities to even improve or make it better?”

Jeremy: [08:53] Yeah. So our talk kind of went from that to them just being like, “can you come here next week and sit down with us and we’ll talk?” And in conversations they’ve gotten bigger, and I don’t know there if it’s a good fit for me, they have a significant package they’re willing to offer for me. But I’ve got a lot of irons in the fire, and you know, it’s not that— that whole thing is not like with you, I love working with startups and you gave me a shout out to helping you get users like, that’s all I did, I reached out to my stuff, I got you some beta users.

Kevin:    [09:31] Yeah. Thousands and it was awesome. I mean, I was like, “Hey you know, we need to basically just throw some more users at the thing.” And I’m like, “how can I get more users and have somebody the reach?” And I was like, “I know Jeremy’s got reach.” And then like we can just find a way to basically push it out. And I think it worked really well, right? And I think yeah, I mean it’s crazy like the people that would come in and you know, we have this in-app chat thing instead of outlook app and people could say, “Hey, I love it” or “I hate it.” And “tell Jeremy thanks” like some people even thought like— because they never referred through you, right? And they’re like, “yeah, [inaudible] Shoemoney told me about your app.” And yeah, it was awesome.

Jeremy: [10:08] Remember the people that like, I don’t know if they bugged you, they bugged me about like, “bro, can you get me in?”

Kevin:    [10:14] Yeah, we were gaining— At first we didn’t want to roll it out and were you know, as a small company we weren’t ready to take that many users on at one pop. And so we were rolling it out slowly. Like we were releasing a few hundred a week. And then a few thousand a week and people were like, “how do I get to the top of the list?” And like, “I’ve referred 40 people, Jeremy said if I referred two I’d get in.” And I was like, “we’re trying to do our best.” And eventually we got everybody got in. But yeah, people were reaching out to me on LinkedIn, on chat or all kinds of places. But once they figured out like there’s a a Twitter, you’re trying to just say, “Hey, how can we get moved up the list?” But it’s cool, right? When you get to build something and see that audience work.

Jeremy: [10:47] And Kevin sold the company. So it’s not like we’re here to pitch the thing. But with that said, from day one I used it, and so to Dell Navi, like [inaudible.

Kevin:    Yeah, Dave’s a good buddy.

Jeremy: Former partner of mine, great guy, good friend of mine. And the thing with Dave is that he’s super critical of like other people’s shit, and his own. And when he used it, he actually used it before me and I got this email, it was like sent from acompli, because I’ve told people I invite them to, but I didn’t run it. And before it was like out of beta. And so when he used it and he liked it, I was like, “okay, it must be pretty good. Because he’s very picky about stuff.” And so I mean, I’ve used it from day one and now it’s branded as outlook, right?

Kevin:    [11:41] Yeah. It’s awesome. Yeah. Now people are like, wait, “what happened to Acompli?” and it’s like, “Well no, it’s now outlook. And we’ve done a bunch of new stuff to it and Microsoft investing in it like crazy.” But I think it’s yeah, it’s been cool. I mean to see that, to kind of take a brand be able to you know, one in seven people in the world use outlook, right? And you think about in terms of the reach of a product or a brand is just insane, and to be able to present what used to be Acompli now is outlook on iPhone and android, is really cool. It’s something that it’s been a great journey so far and I think it’s exciting to see what we’re going to continue to kind of move down that path.

Jeremy: [12:15] Yeah. And I mean you known, Kevin talked about his history a bit, but you know, he was with a company that was called Zimbra, which sold to Yahoo and you went on that ride to Yahoo, and then when Yahoo sold it to VMware you were a part of that, right? And then I was hitting you up for VMware licenses.

Kevin:    He simply said “Hey, can you get me—”

Jeremy: Mine just expired by the way.

Kevin:    [12:39] Mine just expire too. It must’ve been a year or two since I’ve left, right?

Jeremy: [12:42] Yeah. And then you were like, “let’s roll”. What made you get on board with building this? And for those who don’t know, it’s an amazing— I like to explain it to people as— when I was up in Chicago, I showed these guys there, and they were just like, “what?” And they download it immediately. But basically, I like to explain it as a cross between and Gmail, as far as just email functionality. So you get your mail sorted by priority, but it’s better interface than Gmail. But then when you integrate with Dropbox and you integrate with your other stuff, it’s awesome for me to be able to attach a PowerPoint presentation that’s in my Dropbox so easy. Or like, somebody emails me and I just flipped to the side and I schedule a time to talk to them.

[13:35] It’s just like, it’s an amazing application. Okay, we’ve got to go to break here. And actually, I think we’ve got another minute or so, but yeah. So, and then Kevin, when we get back we got to go to a commercial break and when we come back we’re gonna talk to Kevin about what it’s like now and some other shit

Kevin:    [13:59] We can talk about how it started and yeah, it’ll be fun.

Jeremy: What plane you have in your shopping cart. All right, we’ll be back in about two minutes everybody.

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[16:31] Here’s more of the Shoemoney show on webmasterradio.FM

Jeremy: [16:50] So when I launched this Shoemoney system in like 2009, I had a contest because I wanted, because I had this call support center where I had nine— I mean, we were selling over a thousand units a day. So I basically said, “Hey, whoever makes the best Shoemoney system theme song, I’ll give you 1000 bucks and I’ll take you to the Playboy mansion.” I said, “You and a friend, I’ll cover all your flights and the hotel rooms.” So dude, I had— I mean, Brasco knows the ones I sent him, but I mean there is like probably a hundred entries, but like maybe 10 that are really good. And I mean really good. Like, dude, there’s this one that’s like “shoe money system”, Dude, and that was our old music, like when you called in for support.

Kevin:    That is awesome.

Jeremy: [17:43] Oh dude, it was awesome. So dude, that was dekay one. And if you go to YouTube, his Youtube username Dekay, which is D, E, K, A, Y. And it’s like the only thing on that YouTube thing. It’s him in a ski mask rapping the entire song, it is hilarious.

Kevin:    That’s great dude.

Jeremy: [18:05] Anyway, yeah, so that’s the songs. So it’s interesting because you came to the elite retreat and then within a couple of years you’re at every freaking internet marketing event, which is awesome because me and you together are dangerous.

Kevin:    Yeah, no, we’ve had fun. No, it’s funny, the elite retreat just got me like— It’s funny because I was never a kind of a conference— I’d go to conferences like in my kind of software space or startup space, but never the internet stuff. And I think the elite retreat was the first time that I said, “Well, when you can get a bunch of folks together and just having them talk about what they’re doing or what they’re working on, or their challenges” It makes you, it forces you to kind of pause and think.

[18:44] And then it’s like, yeah, it turned into this model. I mean, I met so many different people and network and people that are still business partners with me today and partners in my wife and I’s business that we met after elite retreat and after going to all these conferences. And I think it’s crazy, right? Because, and it’s funny, I’d go to the conferences, wouldn’t go to any of the events, like would just go to the after parties or kind of network with people in the bar. And it’s like, that’s where you get all this kind of the real value of out of that. And you’re right. I mean, I literally for a couple of years there, I probably hit four or five a year, right? In terms of hitting the internet conferences. Now I’m down to just a couple, right?

[19:17] I go to the SEJ summit events and I go to, I’m actually going to speak, I think— Or I’m going to try to speak, see if my wife will let me apply in one of the events later this year, but I think they’ve had a couple now. So yeah, it’s great. I mean, they’ve got events in Santa Monica just recently. They just finished one in Dallas. They’re going to Chicago in a week.

Jeremy: Who is this?

Kevin:    This is SEJ summit. So like the search engine Journal’s now running their own summit series show.

Jeremy: This is your [inaudible]

Kevin:    [19:44] Yeah, we’re doing a show. Yeah, it’s awesome. It’s like an invite only thing, you’ve got to apply to be part of it. It’s a free event and it’s really, really epic, right? And so yeah, they’re doing one in Chicago, they’re going to New York, Miami, they’re going to London this summer. So I’m hoping I can go to that one, even if just as a fly on the wall, just so I can get a trip over to Europe as part of it. But yeah, it’s been really cool.

Jeremy: Who is the brain behind that? Is that all your wife?

Kevin:    [20:09] Yeah, so Denise basically came up with the idea and got some sponsors together. Searchmetrics actually sponsored the series this year. And so yeah, she’s got a great team that kind of the search engine journal folks have put together and yeah, it’s really, really cool. They have some killer speakers. [inaudible], another buddy of both of us spoke at the Santa Monica one and just killed it, right? I mean, the guy’s a great speaker and just really knows how to entertain an audience. So yeah, you should go to the Chicago one, dude. It’s right in your area.

Jeremy: When is it?

Kevin:    Seriously, like in week or two.

Jeremy: I have to go there on the 22nd for the big brother casting thing.

Kevin:    Dude, you’re going on Big brother?

Jeremy: [20:50] Yeah, didn’t we just talk about this or am I having déjà vu?

Kevin:    No, you told me about I before, I think.

Jeremy: We were, like before the show started.

Kevin:    Yeah. You were just getting into it. Like come on, that’s insane.

Jeremy: No, no. Yeah, straight up. So, I did like an open thing, recorded myself on video and uploaded it to their thing. And then I did the first casting call in Denver, which was just a public circus of freaking what you see on the singing show, frickin whatever, not the voice, but I’m sure it’s like that too.

Kevin:    American Idol.

Jeremy: [21:21] Yeah. American idol. So that’s pretty much how this was. It was basically in there and you were, they did like team ones, so you are like one of five people and everything, and they’re like “what do you do? Tell us about yourself. What would you do in this situation?” or blah, blah, blah, blah. You know, just like really, I mean, I got out of there and I was like, “yeah, I got no shot.” And then I got the second round, which is now, it’s a private one. So you go in there and I guess there’s only a hundred people that are going.

Kevin:    So it’s down to a hundred people, and how many they’re going to—

Jeremy: In Chicago.

Kevin:    Okay.

Jeremy: [21:57] So they’re going around the country, right? But yeah, so in Chicago, I don’t know what this is going to involve, but like my wife has given me a green light to have a show man, if I need to do that to win, like there’s all these interesting angles, right? As to why they should pick me. So they were like, “seriously, your wife’s an anesthesiologist and she would and you’re an internet millionaire and she would let you have an affair to win.” And I’m like, “that’s what she said”.

Kevin:    To win. But if you lose that, you got to unwind it all.

Jeremy: [22:30] No, no. But to try to win. You know, dude, not like some chick there, because the whole thing is I wouldn’t be me. I’d roll in as like a freaking nine to five computer jockey and you know, and I already have a game strategy, but anyway.

Kevin:    Don’t reveal it all, people are going to be able to come back to the show and figure this out.

Jeremy: Well but see, the people that are— The outside world will know everything, but have you ever watched big brother?

Kevin:    Yes.

Jeremy: [22:57] Yeah. Because you’re completely shielded. You don’t even have a freaking iPod. 

Kevin:    Yeah, You’re locked up.

Jeremy: Which that’s going to be the hardest thing for me, is not having no internet, no iPod, no newspaper, no nothing from the outside world. No phone, no nothing for was it like three months? So, if you make it to the end.

Kevin:    if you make it all the way through.

Jeremy: [23:23] But actually you only have to make it halfway and then you’re in the jury house, and then you’ve got to stay sequestered. So, I mean, really like I know I’d make it that far.

Kevin:    That’s awesome.

Jeremy: I would be embarrassed if I didn’t.

Kevin:    No, so I looked it up. So April 15th in Chicago, so it’s actually next week. So they’d probably only have a few invites left, but yeah. So April 15th in Chicago, May 12th in London.

Jeremy: [23:48] But I’m on the 22nd. It’s a private thing.

Kevin:    You should do it, dude.

Jeremy: So it’s not— so, we have mutual friends that work for CVS, you probably know— you know [inaudible]. Okay. And so through them I got a contact with the casting company who does the big brother casting stuff, and you know, they were like, “Listen, I’m can’t do anything to help you, but I’ll give you some insight.” And so they said, look, we have specific roles that are handed down to us from CVS.

Kevin:    That we have to fill.

Jeremy: Yeah. And they’re like, “if you meet one of those predefined roles, if they’re looking for a internet millionaire, you’re in.” But he’s like, one year we were looking for like a mixed martial artist. You know, we were looking for like a gardener. And then he also said, and I’m just gonna say it, he’s like, “we have to get an African American, male and female. We have to get a lesbian, we have to get a gay guy.” You know, I mean that’s just the criteria.

Kevin:    Whatever works, right? As long as it’s coming.

Jeremy: [24:49] He’s like, “look at every year, if you’re not black, if you’re not gay, if you’re not a lesbian, basically, then we’ve got 12 other spots to fill.” So, I understand the whole diversity thing and all that, whatever. You know, so I think I would do well. If you’re a guy, you got a pretty good shot, even if you’re not hot, right?

Kevin:    Is that like statistically? have you actually looked at that and figured out like what’s the chance of making it through and what is the strategy? I mean, you’re like a addicted to this show.

Jeremy: Sure. I think I’ve missed maybe two seasons out of, I think this is 17th or 18th.

Kevin:    That’s insane.

Jeremy: [25:45] Yeah, So I know the game. I know all the things. The crazy thing is like, I know like when what happens. Anyway, so I mean, I don’t think I have a chance, but if there’s a chance like— Oh, this is another cool thing. If you have your own company and you are the majority owner, you can wear your company’s logo. Sure.

Kevin:    That’s also as— As long as you’re— Yeah, it’s a private company and you own it.

Jeremy: Right, if you’re just an employee somewhere or whatever, then they have that you can’t do that. So, I was telling some people, they’re like, “Dude, I’d give you like 50 grand, start a company.”

Kevin:    You should start a company, right? 

Jeremy: [26:27] Oh dude. Like Holy shit. Like if you could— Look at the exposure. I mean, a Superbowl commercial is how much?

Kevin:    I don’t know if big brother’s the same as the Superbowl, but I get where you’re going.

Jeremy: [26:40] But over time. Okay, check this out, It’s on three times a week on CBS that pulls like, their numbers are high, their numbers are really high. But then also 24// live feed, and then you’ve got the after dark program, which is on Showtime. Now it’s on their ghetto network, whatever it is. But I mean, dude there’s like hundreds of thousands of people that watch this thing.

Kevin:    [27:10] So, what do you do? You got to pause your show for three months? You can’t do the radio show or you gotta do it, but nobody can tell you what’s going on in the real world?

Jeremy: you know, I’d probably do like prerecorded ones like every day, although, to be honest I could probably— I don’t know how webmaster radio feels about it. I’m actually not watching the chat, but if maybe I get somebody to fill in for me, maybe you can fill in.

Kevin:    Do a little guest podcast thing to chat about life. Yeah.

Jeremy: I’ve had people fill in from me before. John Chow filled in. That was okay. I mean he’s a little hard to understand sometimes, but I love that guy though. He’s been on the—

Kevin:    [27:51] You were with us that time. We went racing and those with those exotic racing in Vegas that time, there was some affiliate, somebody, I forgot, a hosting company or something bought us those tickets. That was awesome. That was Dekay, actually.

Jeremy: Yeah, Dekay. [inaudible] goes out of business and they owe me like 20 grand, the freaking mother— Anyway.

Kevin:    Yeah, you’ve got at least a couple laps in a Lamborghini though.

Jeremy: Yeah, that 458 dude, I love that car. I’m going to have that car. Well now they’ve got the 488 coming out this month, I think. But yeah, I don’t know. Okay, so you sell a company for— I don’t know, how much time we got here? like the three or four minutes until we got to take another break? Because what I really want to get into is like, okay, you sell a company for $200 million. For me, right now, and probably the position you were in six months ago, we were probably close to the same within a bit net worth, probably close.

Kevin:    Yeah, I think that that’s reasonable.

Jeremy: I mean I have no idea where you’re at, but just guessing. Just totally guessing. So the thing is like $1 million, $2 million, put it in the bank, it doesn’t change my life tomorrow whatsoever, right? Nothing changes. I don’t do anything different.

Kevin:    Nothing changes but your change, dude it’s just like the book, dude.

Jeremy: [29:18] No, but I’m saying like I couldn’t tell you within half a million dollars how much money I have in the bank. Now that sounds a bit— but I’m also just like, my wife handles everything, so she’s probably [inaudible]

Kevin:    That’s probably smart.

Jeremy: [29:31] Yeah. So that can sound like I’m a jackass or whatever. And I don’t have like a ton of cash. I’m just saying like, once you hit like, let’s just call it like three or 4 million, if you’ve got that much in the bank, okay, then you— I mean, after I sold Auction ads and I did some other things, I had enough cash in the bank where I live a nice lifestyle, nothing extravagant, and our accountant basically was like, “okay, you guys have more than enough with your kids, everything to stop working tomorrow, if you don’t like drastically increase—”. So, that’s my thing, is like I’m really happy with what I have. If I got $1 million tomorrow, makes absolutely zero difference in my life. You just got $200 million.

Kevin:    [30:20] I didn’t get it all. We had investors and I have co-founders, but I know what you’re saying.

Jeremy: you got more that $2 million.

Kevin:    Yes. I mean, but I mean [inaudible] doesn’t change much. I think take some nicer vacations. It’s funny, this morning Virgin America or maybe yesterday they announced that they were now flying to Hawaii. So I’m all excited because I love Virgin America, and I’m still booking it on points and I was like actually having this conversation with my wife over email because we both love email about that we were like 40,000 points short of like booking the ticket for the family or whatever to go to Hawaii. So like now I’m like scheming how I’m going to go and gain up another 40,000. So I mean, I still you know, and in theory, could I just go buy the tickets, of course. But like, I still like winning. I like winning.

[31:12] And I think your point is well taken, right? I mean at some point you’ve done well, you’ve made money, you’ve bought the things you want. Like if you wanted it you would’ve just ordered it off Amazon, or you would have just bought, right? But I think that the next piece of that is how do you keep yourself excited and motivated? And you have the same thing. I mean you have a bunch of irons in the fire because you love to win. You love to see something that you think of or an idea that you work on or a group that you work with be successful, right? Winning for Acompli was hey, building a great app. Yeah, we got acquired. That was awesome. But I think now you look inside of what we’re doing with outlook, I think we still think of winning as the goal around it. Like, we want to make outlook, the best email client on iPhone and android, and the biggest, and the most users, and the highest ranked, and the highest ratings.

[31:49] And that’s how we keep a team that obviously as part of an acquired company you’ve done great, but I think the financial piece is just one mark and that’s kind of short lived. It’s like, how do you keep excite? How do you keep chasing it? And I think that’s the component that I think you followed well, I mean, you’ve consistently moved on to new projects and you know, you’re just when something’s doing great or “Hey, [inaudible] is doing awesome.” You’re like, “No, I’m going to go chase another—” [inaudible]

[32:23] But yeah, it’s part of it, you like to win, you like to think of ideas and move quickly and attack them. And I think that was when, like I said, I first went to [inaudible], I saw that and said, look I was kind of working on what I was working on. It’s kind of a side project. And that was great to see the other folks doing the same thing and being able to, there’s value in focusing at times, but I think there’s also value in finding what excites you and what you want to go and chase, because that’s just a great way to kind of be motivated.

Jeremy: [32:54] Yeah, and it’s also like, when you come in— Not when you’re wealthy or rich or whatever, when you have enough to where you buy something on Amazon and you’re not worried about “can I afford this?” Right? Or when you go out to eat and you never even think of how much it costs, right? So I mean, when I was in Chicago, I picked up a round of drinks or rounds of drinks with two other people and it’s like $300 and I was like, “Jesus Christ.” But you know, just whatever, you know? And I mean, this probably sounds like we’re fucking rich assholes and you know, whatever. But the thing is that, my point is that when you get to that, how do you not fuck up your kids? That’s the biggest concern I have right now, is that I can buy my kids stuff and 95% of the shit I buy them is for me.

[33:45] It’s not because they even— Like, I have two little girls, I bought them one of those, you know those Nerf darts guns? They have one that they call like the Vulcan, which is like, it’s like a 50 cal. It’s like a 50 cal. for these things. It shoots like five seconds. Dude, I’ve got two little girls. I mean, it’s funny because my dad will come over, this 65-70 year olds guy and all of a sudden the kids pulled out, It’s like, “Whoa, Whoa, Whoa.” And blowing darts all over his face, right?

[34:17] Alright, we’ve got to take our next break. When we come back, I want to touch more about what Kevin was talking about, about why we keep going after the next thing and stuff like that. So we’ll be back in a few minutes and stay tuned.

Voice:    [34:36] Time to catch some more checks. Shoemoney will be back on the webmasterradio.FM

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[37:44] Here’s more of the Shoemoney show on a webmasterradio.FM

Jeremy: Seriously.

Kevin:    [37:57] Is every intro and outro just like a custom different one? Like, you have [inaudible]

Jeremy: [38:02] Dude, I have like, I mean literally I think I gave [inaudible] like 10 that are just really good. Like I said, there’s like a hundred that were submitted. The Dekay one is just an honorary Dekay thing. It’s not because it’s good. Anyway, that’s why you only heard the beat, for Dekay. We gotta get some of the hooks [inaudible] or some of the other ones where it actually talks about Showmoney. But yeah, I think that my awesome producer [inaudible] is making it all work.

[38:36] So, all right, so you’re listening to the Showmoney show. If you’re just tuning, rewind because we just gave up some crazy stuff. All right, so we’re talking about like Kevin is rich as fuck. He just sold his coming for $200 million, which he got all of. No, he has partners.

Kevin:    And [inaudible] I was a small. And a team. You raised money, right Jeremy? and wasn’t there a big raise that went out in Nebraska?

Jeremy: Yeah, well I raised just shy of $600,000 for the art program.

Kevin:    That’s awesome.

Jeremy: Yeah, I mean it was from my wife.

Kevin:    you wrote a blog story about that, right?

Jeremy: [39:18] Yeah, it was good. I’m actually like, I know you’re against it, but I want to raise money for my new thing.

Kevin:    [39:25] You should always raise money for your new thing. I think raising money—

Jeremy: Wait, who was it? Somebody told me, I thought it was you

Kevin:    I might’ve told you that. I’m like, go build it awesome, raise money when you don’t need it, right?

Jeremy: [39:38] But you know what I’m working on and you know what I want to do with it, and I think I need a significant amount of capital to make that happen.

Kevin:    [39:47] Yeah. I mean, I think that’s actually a good discussion if we can spend a minute on that. So I think, when do you raise money? Right? Or why do you raise money? So I think idea— And then it depends on who you’re raising money from, right? I mean, friends and family venture— you know, kind of like before you get into the venture stuff you have friends and family or seed round or something, that’s people that you know, fake, borrow, steal, whatever. And I think that’s hey, get your project to a certain stage of your company to a certain stage. And I think when you go to look for VC money, there’s a very different kind of lens that they put on that, right? They want businesses that are big, right? So they want the story of how this thing could potentially turn into something that’s a multi hundred million dollar or billion dollar business.

[40:33] And you say that and say, “well, how many of startups actually have done that?” Percentage wise, very few. But I think what’s important is that there’s a possibility that it could have happened, right? Like it’s a big enough market there’s a lot of money in the market, a lot of winning space, and that it’s something that could support a lot of capital, a lot of businesses can’t support spending and dealing with spending something that’s $10 or $20 million, especially in this day and age where it’s you know, you can go register a domain online for 10 bucks and throw up a website. I mean, for $100 you can kind of “be in business” with a website in some kind of small SAS service, right? And then your time to write some code.

[41:09] But, so I think in today’s day and age, where do you spend that money? It’s on people. Engineering talent is expensive, marketing is expensive, right? And so I think you end up breaking it into like resources to build the product and resources to market the product or acquire users, right? And then because all this money is out there being raised to acquire users, the cost of acquiring users is high, right? So I think the thing that you’re speaking of without giving the details is I think you’ve identified a way to acquire users much, much cheaper than what you can get in return, right? Like it’s this kind of my joke about PPC being free, like your acquisition model allows you to acquire users for pennies versus the amount of money you’re producing.

[41:52] And so I think when you look at a business like that and say, okay, well how scalable is that? Right? So if you can acquire users for a dollar and you can produce $100 of revenue, great. Well, how many more users can you acquire for that dollar that fit that market? Right? I think that’s the piece that you’ve got to go prove out that says, look, there’s how many more people out there or how many more users out there that would fit this model and go through it. So that if I went and raised a significant chunk of VC capital, five, 10 million bucks, and here’s where I would put the engineering talent or the technical talent on building out the product side, and here’s where I would spend that money. Because as you know, for any given channel, whether it’s a Facebook ad or a Google ad or a billboard, the cost of acquiring users, it goes up pretty quickly as you need to get more and more users, right? Like to get the first user, you can buy the cheapest user for sale on Facebook ads, right?

[42:39] But if you’re acquiring hundreds or thousands or tens of thousands of users a day, those costs start to crawl up on you, right? And I think that’s the key thing of proving out that your user acquisition stays at this pretty good cost even as you scale it, right? It’s an interesting project.

Jeremy: [42:57] I just looked for a domain, I’m looking for domains for the new project. I mean, you know what I’m doing, you love it. You think that it’s gonna [inaudible]

Kevin:    [43:02] Yeah, I mean, it’s going to be great. I think it’s a great idea. And I think the question is how do you frame it so that it can grow bigger than something that’s just a project, or how do you grow this into a company or a movement? And I think that’s the challenge. I think it’s clear it’s a big market. And there’s companies out there that are doing in parallel tracks doing similar things that are much bigger. So it’s easy to make that comparison say, “Yeah, I can grow this into a huge company.”

Jeremy: [43:28] Absolutely. And I’ve proven the model, I’ve already tested it with like a joke, you know? And okay, so that’s what I want to get into is like, my biggest thing, I’ve learned now at 40 years old, over doing this for 2002 when I first started, I didn’t make much money then, but you know, so 13 years of doing this, I just turned 40 and I had this big revelation about like the [inaudible] program, I have it now. The platform is unbelievable. But here’s what I thought, it was like, my true amazing thing that makes me happy and what I love to do is like next pimp. You know, that thing made me fucking millions of dollars, but that was a side effect, that was a side effect of like, what I really loved about that, the money’s cool, but what I loved about it is I got to make shit that people really used and they found a value.

[44:22] Okay. And then you look at the Shoemoney blog, like all that is just me giving people value. Nobody pays me to read that thing. But that thing is printed money as well. And then if you look at auction ads, I built auction ads and I called it Shoemoney ads, and it was because on next pimp I was making so much with Google adsense, but if I put other banners there, they didn’t get as much things. So I made my own thing that looked like Google, but it had my own ads in it, and it did well and I call it Shoemoney ads, then I let other people use it. Then eBay came to me and said, Hey, people are using this for eBay, you should make one around that, Auction ads was born.

[44:55] When I sold auction ads in 2007 it was kind of a rally killer in that I thought, “alright, now’s the time I put away a ton of freaking cash, I’m going to freaking build this Google of the Midwest.” And so I hired a lot of developers, video people, graphics people, built up a monster freaking payroll, like you know, a lot, and had tried to build like a real, what people would call a real company, you know? And that would went on for until for about four years.

[45:33] And you know, the part program is my last attempt and I’m really like, I don’t know why I’m even saying this on the air, but I’m kinda like over it, and I’m putting it in some good hands now. But basically, just doing sales calls, managing a team, dealing with maternity policies and vacation times, it absolutely kills me. So in the last 10 days, would be 11 days now, I did something that is made a shit load of money and is legit and adds value to people’s lives, and I’ll be in— And believe me, everyone knows me. I’ll be showing it like crazy on the show, web master radio will be like, “alright, seriously stop it.”

Kevin:    They’re like, this isn’t a promotional call.

Jeremy: [46:15] Right. But it’s like the best thing I love about it is I wrote every line of code myself. I love it. That’s what drives me. And all these things that have made money, the money was just a side effect of building a fun application that other— That’s what I love doing. And when you do that, I mean that’s a magical thing to me. I got away from that and those were the most miserable days— They weren’t bad and yes I still made money, sometimes even seven figures, but it didn’t really come from that, it came from doing other things. But basically my point is that the most successful and happiest times in my life were just when I really built things for other people to use.

Kevin:    [47:00] Yeah. And I think the other thing is the satisfaction. I mean, when we were first building Acompli and then outlook, right? I mean there’s nothing better than launching a feature and then seeing people say “I like it” or coming on Twitter and say they want to use it. And similarly, actually I get motivated, like we released a version, it’s like, “Oh, I think something slower or it’s getting a crash when I do this and that.” And it’s like you want— You force yourself to achieve even a higher level because you’re like, “man, these people are counting on me to build something and they really love what they’re using, and they’re willing to talk to me”, right? There’s nothing worse than building something and not getting feedback, right? Like, it’s like the proverbial giving a speech and nobody claps.

[47:41] The neutral response like, I would rather you hate on it and say you disagree with me and tell me that I’m terrible, at least I know you listened and you have an opinion, right? Like, I was able to strike a nerve, right? But building something or doing something and not getting and response is just a really painful place to sit. And so, what you’re saying is that you want to find something where you’re motivated, but you’re motivated in some, almost vicariously, these are the people that are using it because they’re either seeing value in it or they’re using more of it, or they’re giving you feedback on it, and it’s that that kind of drives you to stay up that extra hour at night or two hours at night and crank on something, because you know that when you click the release button and you push that out, it’s like, “wow, I’m going to get feedback. People are listening, they’re waiting for this. I have an audience” right? And I think yeah, I agree.

Jeremy: [48:29] You andI are very similarly wired. And this is the thing, like people are always like, “well you can do this cause you’re Shoemoney.” And I’m like, dude, I wish like you. And I don’t wish I was them, but I have a wife, I have children, okay? I have a lot of employees, I’ve got to make $5,000 a fucking day to break even, okay? Before I take a dollar myself, right? Wake up with that tomorrow and let me know how you feel, alright? And then you want to do all this. Like, so many people who are who say like, “well, you can do this and that”

[49:09] I’m like, dude, the position you’re in, you have a day job. And they’re like, “well, I’m debating whether or not to quit my day job to try to make money online.” And I’m like, really? Are you effing kidding me? You know? And that’s the thing, and that’s why Kevin knows this latest thing I’m working on is without alluding to it, but why it’s so successful. But you know, the thing that bothers me is people are like, and they hear us talk, right? And then they think, “well, you’re in this position.” When I launched Auction ads Shoemoney had a reach, but I wasn’t freaking Mike Arrington, or you know, somebody like that. If they launched it everybody would sign up for it tomorrow. I had to freaking bust it through a lot of people—

Kevin:    [49:50] Yeah, so you got above zero quickly, but I think to get it to where it got to and to sell it for as much as you sold it for, I mean, you’re not going to sell something for that many millions just by, hey, throwing it out in your blog, right? You have reach, but you need to go deeper. And I think that’s the beauty of building something that people like and people talk about. And this is that notion of how do you get things to be viral. And yeah, I agree. Like there’s gotta be a way that you’re driven to do it and that you enjoy the process, right? If you’re just building it to have a financial outcome or something that’s a very fixed goal like that, you’re not gonna make the right decisions. Whereas if you’re having fun, because whether it takes a year or six months, or 18 months, or four years to build it, if you’re not having fun, you’re going to give up early. And you know, you want to have that ability to drive and say “I can do this forever because I enjoy it so much” right?

[50:39] And it’s a great way to approach kind of projects as you think about it. And I think this new project is like that, right? It’s just awesome. I think you found something, you like, you’ve tested it, it seems to work. And then like that hit of dopamine where you’re like, “Holy shit, I got something great “ [inaudible] the next thing. And I think it deeds you, right? It’s literally a hormonal response at some level, you’re seeing these little wins, right? And whether you’re making a dollar or two and you’re thinking ahead like, what would that look like if I run that out? 

Jeremy: [51:11] Here’s the thing, we don’t have much time left. One of the things I want to point out is that what frustrates me the most when I talk to people is they want to make a business plan and all that, and that’s good and all. I’m not against that. That’s not the way I’m wired, that’s not the way Kevin’s wired. Like, we come up with something that we think, we prove the concept. You sit down and you start doing it, you know what I mean? And people who are like, “what’s your SEO strategy?” I mean, Kevin, you know what I’m working on right now. You think I have an SEO strategy?

Kevin:    No, that’s not important right now. You’re proving that it works and proving that there’s a model and then failing, like you’ve got to find the problems with this thing, right? What’s not going to work? or is there going to be fraud and really problems with it?

Jeremy: That’s the key.

Kevin:    [51:57] Find the problems and fix the problems to make sure you’re working on the right things, right?

Jeremy: And you know I just ran into a problem last night that cost me about 600 bucks in a couple minutes.

Kevin:    Yeah. But I think that’s why I mentioned the fraud thing. Because I think those are the kinds of things you hit. And that’s the real part of starting a business or starting a new project, right? You have to find those quickly and work around them. And if you can’t, then you need to stop and do something different, right? Or make a different path, I think. And you’re amazing at that part of it.

Jeremy: Thank you. Coming from you, that means a lot. And it’s kinda been fun cause we’ve kinda gone— because I met before Zimmer sold. We met before Zimbra sold. And so, we’ve kind of been on the same journey. Like we met before Auction ads sold, before even rhat thing was going. So, I look back and it’s been eight years since that, which is interesting. And I found it on stunt doubles blog. Remember that?

Kevin:    [52:56] Yeah, dude. [inaudible] I know. I haven’t seen him in years. I need to go. He keeps offering me to come to go fishing with him and I need to go charter a boat. Next time we’re in Miami. He owns a boat dude. Yeah, he’s a captain of fishing boat.

Jeremy: [53:03] My wife wants to go see some freaking thing— Anyway dude, so today somebody asked me— somebody emailed and said, “Hey, I see you own, do you want to buy So you know me, I’ve replied back and I said, “well, it depends how much you want for it.” So they replied back and said $500. And so I’m like, well shit, I mean, that’s sounds reasonable.

Kevin:    If you don’t buy it, I’m going to buy it and set up my own company.

Jeremy: Well, here’s the best part about it. So who is on it, it’s pending deletion. So, this company must be scraping data on domains that are about to be deleted, and then emailing all the other TLDs and asking if they want to buy, which is smartest shit.

Kevin:    Great business.

Jeremy: [53:53] Yeah. But that’s the thing, there’s so many opportunities out there and I just came up with this thing and it’s like printing money, and like— But the cool thing is, and Kevin knows about it is like, well, I don’t want to get too much into it, but anyway some cool stuff. We got to run here in a couple minutes. Kevin, what’s some final words of advice? And by the way, Kevin’s wife is way too intelligent and way too hot for him.

Kevin:    Thanks dude.

Jeremy: I meant to say that a while ago.

Kevin:    [54:25] Keep it at the end. Save the best for last. No, I think—

Jeremy: You got one minute.

Kevin:    [54:29] Yeah, I got a minute to wrap it out. So I think my words of advice is like you said, I mean, find something that you love and work on that, and get feedback early and often, and that’ll help you keep motivating yourself to keep working on it. And it’ll show that you’re building something that people love. I think for those of you that want to go learn about marketing, go to have my wife’s conference SEJ summit. They’re going to be in Chicago, in New York, in London and a bunch of cities. And so you can go to SEJ summit or and sign up for a requested invite. And if you haven’t tried my outlook app on iOS and Android, you got to do that. Just search for outlook on the app store. And yeah, dude, Jeremy. Thanks again for having me, it was super awesome.

Jeremy: Yeah, you said it was SEJ summit like, S E J—

Kevin:    I don’t know, just put

Jeremy: Oh, two M’s, I didn’t put two M’s.


Jeremy: [55:17] Thanks everybody for listening. Kevin, thanks so much for coming on.

Kevin:    likewise.

Jeremy: Bye everybody, we’ll talk to you next week.


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Outsource Like a Boss

Heavybit Industries Video: Kevin Henrikson leads engineering for Acompli in San Francisco. Previously, he was Senior Director of Engineering at Zimbra (acquired by Yahoo! for $350M).

Kevin: [00:10] Cool. So first of all, thanks to Tom and Tim for inviting me to come talk, and I’m going to kind of go through outsourcing. So I figured the first thing I was going to do, let’s figure out the first I was going to was just outsource the talk. So my daughter, when she comes in, she always likes to sing on this stage and so she’s actually been up here more times than I have and so I was gonna have her kind of do this presentation. So, but instead of doing that, I just outsourced actually building the presentation. So I had a guy do this for me. I wrote like the high level kind of bullet points that needed to be built out, but all the fancy graphics and stuff was somebody else. And so there’s about 500 minutes of editing time.

[00:44] I was looking at the PowerPoint file and I did about 60 of those and so it was pretty cool. So then, so this talk’s going to kind of walk through outsourcing from like how do you learn to outsource kind of from your personal life and things you can do individually, and then kind of that road into how to build an outsourced team, whether it’s starting with a small one or potentially a large one, right? And then as we go through that talking through, how do you manage remote workers and what’s the best way to handle delegation. And then a bunch of kind of tools with kind of practical tips and tricks that I’ve learned. And some of them we use today at Acompli, and some that I kind of manically use in my personal life to kind of try not to do anything. 

[01:22] So, my background. Spent a bunch of time, kind of the last 15 years basically doing email at a variety of companies starting with open wave for carriers and then Zimbra which got bought by Yahoo and then VMware. And then now more recently Acompli we’re working on the cool team upstairs doing kind of mobile email. And kind of along the way in college I worked at this company called FedEx. And what I learned there was that kind of optimization and process is really important. And it was by far the most exciting job I’ve ever had. You know, you would, these trucks would all show up, you’d grab all the boxes out of them and you’d load these planes and it happened in a matter of three or four hours you’d move thousands or millions of packages. And the interesting thing about that is they are always trying to find ways to do it better and faster and more efficiently, cause that was kind of their game. 

[02:07] And so they had some cool things where like at night they would just launch airplanes and fly them around empty, just hoping one would break down or kind of expecting one to break down or expecting the amount of freight to overload. So they, so their version of a hot spare rather than like a server or hard drives was actually an empty airplane flying around just waiting for something to break or go down. But the ultimate kind of sides. And so that’s where I kind of got started to get hooked early in college on how do you optimize things and how do you kind of make things better. And so I had a little team there that started literally unloading trucks and then moved and into the world of loading the airplanes and kind of getting to work with the bigger toys. 

[02:40] And so in the process of kind of doing 15 years of email I’ve seen literally millions of people and how they use email, right? Not directly, but kind of in aggregate or how the, how they complain about how things work and how they do work. And the amazing thing about that is everybody’s different, right? The way you work and the way that you manage work is very different. So there’s inbox zero people, there’s inbox gazillion thousand people with hundreds unread like my wife where I’m like, how can you manage your life cause you have all these unread mails or people that don’t even read their mail, they just periodically look in their inbox once a week and pick out some of the interesting ones. And so everybody has a different way of doing it and they all kind of work.

[03:16] So, as part of that, those are kind of all kind of fed into the way that I’ve kind of learned to manage people and most importantly manage kind of remote teams and outsource teams, cause you have to kind of understand the individuality of the people that you’re dealing with and how they work through. And so today at Acompli, we have 15 or 16 people upstairs and then we have a small team in Poona in India, which is four guys that we’ve started. And so that kind of sets the context. In the past, as Tom mentioned, I manage a pretty large team at VMware, kind of after the acquisitions of Zimbra and Yahoo where we had over a hundred people, many contractors and remote workers and many different offices in India, China and several across the US.

[03:53] And so tonight kind of what’s the plan? Like how are we going to walk through this? And so you know, first of all just talk about why outsourcing, like why would you go and outsource anything? why wouldn’t you just do everything yourself? And hopefully that starts to become obvious as we work through the path. But start with just some of the high level points around that and then maybe explore into what’s the ROI. Like what’s your return on your investment? Not only your time but the money you spent to outsource something or have it done, right? Like what was it worth for me to pay somebody to go build this PowerPoint rather than me spend the time to do it myself for 500 minutes that he edited it. And then kind of working the road from kind of individual personal productivity and how you can do small things to make yourself more productive and then kind of moving that into your team or broadly more broadly, your company and how you can make your company more productive.

[04:38] And then finally, kind of how that leads into the path of actually building a full outsource team that works for you or your company in terms of you know, scaling that out. So late in 2007, I read this book called the four hour work week. Have anybody heard of that? This Tim Ferriss guy? Yeah. It’s like basically only work four hours and your whole company works like that. And so clearly I think that’s mythical for most people these days. You know, nobody’s literally gonna work four hours, maybe just Tim. But there’s a lot of kind of things that came out of that that were pretty, they were pretty insightful. And so the first is your time has value, right? And it’s not just the hourly rate that you make, but also the time that you’re spending doing something.

[05:20] And if you take your hourly rate, that’s one way to look at it and say, Hey, am I doing a job that somebody else can do for a lower hourly rate? That’s a very practical way to look at it. But there’s also, you have limited time in a day. And so being able to find ways to use that time most wisely and most strategically going forward is important. And so a lot of people kind of the first thing they think is “well, I’m the only one that can do this task. Like, only I can do this.” And I think at first that’s true, but once you start to kind of dissect things, you would say, “well, I’m going to go do a presentation that I didn’t build.” Well, I mean, if you read through it a couple of times, you’ll start to learn it and you can start to extract yourself from the mechanics of doing something and then the process actually executing upon it.

[05:59] Some people have this kind of loss of control, right? When you think about, “Well, if I outsource, I’m no longer going to have control of the situation or control of the outcome.” And to some point that’s true, right? As you start to manage teams and work with people, you don’t have direct control over the work that’s being done, but you can influence that. And learning how to influence that and kind of set up success metrics around that is important. And then it’s kind of start small and expand. And so you want to focus on what you understand and what is simple, and then work into larger problems, right? So clearly you’re not going to start on day one and say, “I’m going to go hire 20 people in some foreign place” and try to figure it out, or even in another office around here. And as you’ll see as we go through this, it’s very cheap to fail and kind of cheap to test this and start some of these things. You can literally do it for a couple of dollars an hour, just find small little tasks where you can start to learn and see how this kind of process works.

[06:49] So how did I get into it? So after Zimbra got acquired, my wife was like, “Well, I hate my job.” And I was like, “well, what do you want to do?” And she’s like, “I like to buy shoes.” And I’m like, “That’s awesome.” And so we bought a website that sold shoes. And so that’s kind of the first inclination of a company that we started together called Alpha Brand Media. She runs that company, she’s the CEO of that company now and it’s a large portfolio of web properties that we’ve acquired and built over the years. But it literally started from one website.

[07:12] But as part of that, building this company was kind of like my night job and her day job during the time kind of after Zimbra got acquired. We spent a ton of time on low value tasks, like literally writing blog articles and writing, doing research about shoes and looking up like, well, what colors do all the shoes come in, what sizes they come in, and building out product pages for all these shoes and retail clothing and urban clothing and all these different sites that we owned. And so then we started hiring people to do that, but the cost of that started to escalate. And so literally, like the labor costs were insane. It was like 82% of the company’s spend was on people like writing blog articles and something that was relatively, pretty easy.

[07:52] And it couldn’t scale because a lot of that we were doing ourselves, and there was many single points of failure. There’s like the one guy that worked on the website, there was the one guy that wrote blog articles for this particular site and things like that. And so we applied outsourcing to it and a bunch of things that I’ll talk about in these tools and kind of tips. And basically after about six or eight months just before our daughter was born, which was kind of the trigger for that cause we said, “well, look, my wife can’t spend 50 or 60 hours a week and I can’t spend 20 hours at nights and weekends kind of doing this. How do we make it so we can extract ourselves from the process?” And so we ended up hiring over 50 remote workers all over the world that we’ve never met and made it easier for us to travel and get away and basically cut the cost of actually doing this work by over half, which was pretty cool.

[08:36] So, now I’m gonna walk through just some of the sites and some of the kinds of tools that we’ve used to kind of do this. And many of these we still use today at Acompli, and I use in my personal life just to kind of optimize things. And so the first kind of category of these, and we’ll walk through several kinds of categories, is just remote workers. And so you guys have anybody heard of oDesk or freelancer? Like there’s lots, Fiverr, there’s lots of sites out there where you can just kind of hire somebody to do something. And so oDesk is my favorite. it’s been around for a while and there’s a couple of reasons for it. So one is that you can kind of see this very clean work history of them and you can build up an employer history.

[09:11] But the awesome thing is they run this little toolbar on people’s computers that take snapshots randomly every 10 minutes, and so you can see exactly what’s on the person’s screen. If their working, and how many keystrokes and how many times they moved the mouse. And so it literally tracks their activity. So you know, if they’re just not like listening to the radio or chatting or doing something random. And then oDesk handles all the tax paperwork cause these people are many times in different countries where it’s not easy to report taxes and handle that.

[09:38] And so what are some costs? And so it’s insane, right? We’ve actually hired people for less than a dollar an hour in some of these countries and they’re super loyal and they love it because in their country nobody makes a dollar an hour US, but you know, see there’s some other kind of high level things. So web researchers for a couple of bucks, writers for six or eight bucks, designers for $15, developers. And again, these are just rough ones of what you can do. I’d say manager in quotes at the bottom. When we got up to 50 employees, a lot of the work was just going back in reviewing the lower paid employees’ work to make sure they were doing things right. And so we started hiring kind of second level managers to go and look and just say, “well, anytime you see somebody chatting or on Facebook, just send them a message and say, ‘Hey, you need to revert that time and we can’t pay you for it.’” And that person basically paid for themselves just finding people that were basically billing for time that they didn’t do, which was great. And you know, and if after a while they break the rule a few times, then you just let them go. But in higher paid workers generally require less supervision. So I think clearly when you’re hiring somebody for 60 cents an hour or $2 an hour, the type of tasks they can do and the type of supervision and kind of framework that you put around them needs to be a little more rigid.

[10:47] So some tips, right? So we’ve used it for a variety of things. I think more popularly I use it for hiring writers. So I have my ghost writers, all my blog articles, that if you ever read my blog, most people don’t, but are written by ghost writers, or you know, highly edited by ghost writers. This PowerPoint was built by somebody who helped me write it. Tech roles, so just general programmers. So at Zimbra we have some guys that just do Perl scripts for us for testing and load testing and things like this, or generating data. We need to fill up lots of email accounts with email. So we have somebody that just bangs out some quick Perl scripts. Research, which I’ll talk about in a second. We do a lot of research. And so when you say research, what does that mean? It’s really just web research. Go search the web for ads and present it to me in some organized fashion.

[11:28] Generally you want to hire individuals cause there’s lots of agencies on these sites where they try to roll up workers and they’ll give you one good worker and then after time they’ll switch it up for one that’s not as good. But if you hire individuals, you kind of bias against that cause you know the individual you’re working with. if you’re doing technical projects and you’re not technical, don’t pay by the hour, pay fixed price just so you can kind of judge what you’re doing. And I have this kind of process I call the audition, so whenever I go to hire somebody, we are trying to look for pro programmers, I hired five and I give them all a one hour task and said go write a script to do X. And then the ones that do the best after the first hour, you’d keep them and then rotate through that. And then after a week or so you find the one or two guys you want to keep for the long term.

[12:06] So the ROI here is pretty simple, right? You can hire people to do relatively complex, relatively simple tasks, a whole mix of that for a pretty good discount over what you’re probably getting paid or what your employees are getting paid. And the success here is really you needed to define that and set the bounds up for what you’re looking for and make it very clear that you have checkpoints to kind of focus on these people and make sure that they’re getting the work that you want out of them.

[12:30] So this is a research project that we did. It’s really hard to read, but basically it’s a list of like 150 different mobile apps. I said, go find every mobile email app that exists. And so they searched iTunes, Android, windows mobile, Blackberry, etc. All the different mobile email apps that exist and build a spreadsheet of them with their names and their price, and where they are, and the URLs, and whether they’re funded or not, and what their Twitter handles were. And so we use this for a lot of reasons, right? And so one of the obvious ones is we go and grab all the Twitter accounts and we retarget all their Twitter accounts and make them follow ours, or use in advertise. We’ve used it just to go and do due diligence on these people and track them in blogs, and I have all of their blogs and so we subscribed to their blogs and watch when they’re saying things or they’re doing things.

[13:15] And basically also kind of, you can see there’s a bunch of tabs, I didn’t bring them all up. But basically we went and after we found all the apps then go and find people that are influential in this space, that write about email, go and find blogs that write about mobile email, go and find people that are kind of influencers in the space that talk a lot about mobile productivity. Go and find sites that just review mobile apps, we found hundreds of sites that review mobile apps. And again, just load these in a database. And I think this whole thing probably cost like 150 bucks to build out. It was five to 10 bucks an hour. There’s a couple of different researchers, one kind of low end, one that would do the basic one, and then a higher end one that would kind of synthesize the data and make sure that it’s correct.

[13:52] And then the next thing is we took that same data and said, now go back a year and find all the articles that were written about those apps and generate a list of all the articles and what the sites are, and the authors of those. And so this came up with about, I don’t know, 200 or 300 articles about basically all of our competitors in any news article that’s written about them. So press release, news article, their blog, whatever. And we categorized those by news source, but then also by reporter and author. So we can see what are the sites that are writing about mobile email? And then more importantly, on those sites then you look at some of the big sites have huge numbers of authors, which ones are the ones that do the best mobile review apps or which ones have reviewed our competitors so that we can start to kind of track them and watch what they’re doing? And so this thing probably costs about 200 bucks. Again, about 10 bucks an hour, and the guy spent about 20 hours on it to build it out.

[14:37] And so in a later section I’ll talk about some other stuff we do with this data, which was pretty interesting. So our PR team would have went and you know, build us a ton of money to go do this kind of basic research to go find all the competitive information, find all the data. Here we said, here’s the information. You go do this.” And clearly they have relationships with a lot of these people and they can go and help accelerate the process. But we were able to kind of give them the data for a fraction of what we would have to pay them to go and do this research for us.

[15:03] So kind of the next category is local workers. So a lot of times the remote kind of web connected person doesn’t get it done and you need somebody who’s a little more local. You need somebody to come into your office to do something. And so in this case you kind of go on Craigslist or TaskRabbit. And so for my wife’s company, one of the things we do a lot is cover local events. So we get tickets to some concert or some clothing release in New York or Atlanta, or some city that we obviously don’t live in. But we can go hire somebody off Craigslist for 20 bucks, and a lot of times they’ll do it for free cause they want to have access to the event. So we’ll give them free tickets to go to a concert, they have to just write a blog article about it. And so we’ve also used them for conferences. So we’ll go and hire a video crew and then send in a spokesperson and have them go and do interviews. Great way to create a bunch of blog content, to just go and interview people. And again, the video interviewers work for almost nothing because they want the screen time and the practice. The camera crew, if you can negotiate a deal generally for credit, they’ll do it relatively cheaply.

[15:57] You can use them for deliveries, lots of stuff. I mean, these ones are pretty straight forward. If you had somebody to do something. I’ve used them at home, I’ve had somebody come over and just help me scan all the documents, right? So everything’s digital. How do you go and scan all this stuff in my file cabinet and get it onto a USB stick? Somebody can just sit there and feed my scanner all day for six or eight hours. So the ROI here is again, simple, right? You can get tasks done quicker because somebody’s there to work with you. And then again, you could, you’d be doing something else while they’re doing something for you. Success here is pretty simple. I mean, you’re generally watching them cause you’re local. We generally don’t work with people on a remote site unless we’ve worked with them before. So we wouldn’t hire somebody to do something and you know, go to a conference in Las Vegas unless somebody is kind of representing or being with them to kind of make sure that the things are getting done right.

[16:39] Kind of the next one is kind of graphic design, I think you know, best and awesome designer she does all our kind of in house kind of production work for the app, obviously. But there’s certain things like you want to just go bang out ads or my wife’s company, we had some logos designed for a bunch of sites where we didn’t really care. You can go and pay a design firm thousand bucks for a nice logo or a hundreds of thousands if you use one of these really expensive ones. 99 designs gives you hundreds of them for a hundred bucks, right? You’re buying logos for 50 cents on the pop. And you know, kind of the tips there is quickly go through and give feedback, right? Cause a lot of these contests sites, you get an immense amount of submissions. Most of the first ones are very crappy, right? And so you want to basically have a quick filter to say “This one’s terrible. Get rid of those.” So people start to focus on what you like and give you stuff that works, right?

[17:25] You know, give the visual examples. Say I like these kinds of sites or I like logos that look like this so that you kind of coached people to do things that you want, right? It’s not really stealing, it’s just kind of helping them understand your needs. And then a lot of times we’ve ended up hiring. So, two of the designers that worked for my wife’s company, now we’ve hired them off 99 designs and said, Hey, just come work for us full time or half time or whatever. You can kind of use it as a recruiting tool.

[17:48] So the next one’s just kind of crowdsourcing. So I think most people have heard of Mechanical Turk. So we use that to create lots of consumer email accounts. And so some of the consumer email companies don’t like you to create lots of accounts in an automated fashion, so you have to do it manually, use a phone number or something like that to verify it, or you want accounts in different locales. And so again, for us to do that, we would have to set up proxies or something, but it’s easier to do that on mechanical Turk. So I think we were paying about 25 cents to create an email account with a phone number verification. And that would usually take a couple of days to get through a 50 batch of accounts. And if we doubled the price to 50 cents, we could get it done in a few hours, and so that was pretty nice.

[18:27] And then CrowdFlower is kind of a layer around mechanical Turk. They actually have their own workers now. They don’t use mechanical Turk anymore. But the cool thing about the software that they’ve built is they have this notion of gold. And so basically you provide a similar task, and so you say, “Hey, here’s a Twitter feed and I want you to go and tell me which tweets positive and which ones are negative.” Very simple question. Read this tweet and tell me it’s positive or negative. You give them four or five examples to kind of coach them with the gold, and then you can upload a large feed and then they go to work. And what you do is you run the test three times, you have three different people read that tweet and say positive or negative and it comes back with a score and says it’s more positive or more negative based on that. And so kind of sentiment analysis. They can also do things like scraping the web for things like that.

[19:09] So what we use them for is we fed that spreadsheet of all of the articles written about our competitors into that, and this is kind of the results. It was like 290 articles. I think it costs like 40 bucks for the article to be read three times, and they basically make a simple vote, positive, negative or neutral. And then what we do is you come back and you get a score, one to five, or one to three, or whatever numbers we picked to say, was this author generally writing positive articles or was this author generally writing negative articles? or was this particular app getting lots of positive or negative articles? And so again, a good way to kind of quickly run through a bunch of data without having to read all these articles and kind of bounce back and say, “Hey, here’s the four or five reporters we want to go after to do PR with because we know they’re writing positive articles.” Or we know they’re writing negative articles and we don’t want to work with them. We’d rather pick somebody else.

[19:59] So, kind of the last category in the kind of personal productivity hacks type of approach is what I would call the virtual assistant. And so Fancy Hands is my favorite. Zirtual is kind of a higher end one where it’s pretty expensive. It’s kind of like hiring or renting an assistant, it’s a little more personal but it’s a little more expensive. And then we’ll jump into fancy hands first. So fancy hands is basically, I’ve been using it for like the last eight or nine months and it’s really simple. It’s really simple. They have a PC and a phone and they’re US-based workers, and they can do anything that you can do with a PC and a phone, so they can jump on the web and look something up, make a reservation, go do research for you. So I’m like, “Hey, I’m going to Napa this weekend and I need a car and a hotel. Go and research what’s the best deal and give me five options.” Or “I want to take my wife to a bed and breakfast in XYZ city. Go and find three recommendations and tell me what the prices are, and then go and make the reservation for me.”

[20:51] They can also buy things up to 100 bucks. So, you can say like “I left my jacket at a restaurant last night. Can you go into task rabbit and file a job and pay them the 12 bucks to go pick my jacket up and bring it back here?” I mean, you can make these crazy meta tasks. So, I think I use it for the most is phone calls. And so I hate sitting on hold, and so you just say go call this number and you know, call HBO or go and call the Comcast and get HBO added. And so normally in Comcast you work through all the system and you get to HBO and you find the right guy and you sit on hold, and then you get to the point— So they run through the entire kind of script, get to the point where they’ve told them your account number, told them what you want, and all you have to do is they’ll patch you in at the last minute and say, “yes, that’s what I want, approved.” And then it’s done in like 30 seconds.

[21:36] And so, a while ago my credit card got stolen and I had to go and change my credit card for a bunch of stuff. And same thing, you have to call a lot of these companies, they wouldn’t let you do it online. You had to call them to change your credit card. I just gave the list to fancy hands. I said, “call all these people, go through as far as you can through the security questions. The point when they actually want to give the credit card number, just patch me in and I’ll read the 16 digits off and say, yes, that’s me.” And it’s done. So rather than sitting on hold for all of these, most of them were like my daughter’s school and like my daughter’s swim lessons, people that just didn’t even have a website so you had to call and wait for the lady to call you back. And then finally when they got on the line, I would just get a quick call. I’d say, “yup, here’s the number. I’m Kevin. Yes, change the credit card number.” Makes it super easy.

[22:14] Another one is when we hire executives, or like when JJ and Javier were starting the company, I was like “go onto the web and search the first three pages of Google and Bing, and find all the links and references to us as individuals, and then come back with all the lists of profiles, make sure that they’re current and they say that we work at Acompi and not two companies back, and make sure all the head shots look nice and it’s not like a picture of JJ on the beach or Javier driving his fast car. It’s like let’s go and put professional pictures to kind of give a nice image for all the people that work at the company, or the executives.” So just another simple thing.

[22:44] So you can see like some of the totals. I think it’s like I’ve made 130 requests. They’ve placed 219 phone calls, they’ve sent a bunch of emails and things like that. They’ve scheduled a lot events. They’ve saved me money. So one time I got out of a Hertz car and the satellite radio wasn’t working. And the guy’s like, “Oh, we’ll take it off your bill. Just go wait in line. And you know, we’ll take off the whatever week of satellite radio.” And I was like, “Oh, that’s annoying.” So I just took a picture of the receipt, clicked fancy hands and said, “Hey, go call them and take this off.” They called Hertz, figured out the confirmation number from the receipt and said, “yeah, no problem. It’s taken off. You got your 40 bucks back.” So I think that’s why I saved my 129, so I must’ve done it one other time as well.

[23:17] The costs, I think it starts at like $5 a task. And then if you buy more, it gets down to like two bucks a task, and they’ll basically spend up to 15 minutes on it. And so sometimes you want them to do something for an hour so you just say, “use four tasks and go do something for an hour” and they’ll knock it out. And then this one’s a slightly different one, but rescue time, anybody heard of rescue time? it’s like this thing that tracks like what you do. It’s a little creepy, but it kind of tells you what apps you’re using online. And so it’ll basically email the most thing I do, cause I’m testing, so I think it’s probably not good that I do email all the time, but it basically gives you a quick view into what are you doing. And so I use this periodically to go in and just look at like, what am I spending time on and is there that app or that site that I could go have somebody outsource.

[23:58] So that kind of was a quick run through of like all the kind of personal hacks and productivity stuff. Now I’m gonna switch gears a little bit and talk about kind of remote teams and offshore teams and how we think about that or how I’ve thought about that over the last few years. So kind of the first piece you do when you want to think about building an offshore team is, are you at a point where you can go and afford that, and is it the right stage of the company to go do that? And so for Zimbra, we didn’t start our team in India until our B round. And so it was 18 months into the company and then we decided to go and create an entity and start a team in India. With Acompli, because I was more familiar with it and we had done it before, we started it right when we kind of raised our series A, so much earlier in the company

[24:42] In the past at VMware we had a really big team in China, which was awesome. And JJ speaks Chinese, so that’s nice. And so we looked at China, but the problem with China is that financially they require a quarter of a million dollar investment just to start like an entity there, kind of hire your first person. So it doesn’t really make sense for a startup to go and hire a small team in China, at least at this point. But in India, you’re able to do it for dramatically less, like 10,000 or 15,000 bucks. You can go and start up an office with a few people and build an entity. And the other kind of thing that you want to check with your lawyers and financial people on when you go and start this is, is this appropriate for you to do for your type of company? And so one thing that we had problems with Zimbra when we got acquired was we had created an Indian entity.

[25:22] And when you create a corporation in India, it’s basically impossible to shut it down. There’s like only certain times of years when they allow you to shut down companies. And so these entities exist for essentially forever. And so the Zimbra entity after it’s been acquired three times, still exist in India and we’ve never shut it down. And it’s like a shell with a few bucks in it. They’re waiting for the next opportunity to close it. And so for example, when Accompi company went and took this route, we started with doing contractors until you reach kind of the point of scale where you want to go and take on that, the risk and the kind of legal ramifications of dealing with an entity there that you’ll have to deal with. So the other option is to go and use a third party vendor that already has an entity and you hire contractors, and I’ll talk about that in a minute cause we are doing some of that now.

[26:05] And so when you start to grow a team, like you have to figure out like who’s that first person you’re going to hire. And generally you don’t want to just hire one person cause that’s going to be hard for them, they’re on an Island unless you know them or you’ve worked with them before. But you really want to focus on finding somebody I call like the player coach. Like, they can do the work but also can kind of grow a team around them. And so in our case, we found a guy that had managed teams in India before, but also was a relatively competent iOS developer. And so we had the mix of knowing iOS, knowing mobile, building QA teams. And so from that we were able to build around him, a set of mobile developers and some QA people. And now we’ve got a pretty solid kind of mobile team that we’ve started, you know several times zones away.

[26:45] And so you know, how do you kind of build the right culture? And so one of the things that I think I’ve seen done wrong at previous companies is that the remote teams or the offshore teams end up being treated as kind of second class citizens or they’re not kind of treated and blessed with having fun stuff to do. It’s like, “Oh, you guys just do support, or just do QA, or just do our manual tasks.” And I think what was successful for us at Zimbra is we really focused on making each team kind of centers of excellence, right? So we hired great people, smart people that wanted to work for a product company, that weren’t kind of tied to being this services kind of like architecture. They were really focused on building a great product and being part of our team. So they got t-shirts when we got t-shirts, they had their own office with a sign on it that said the name of the company, and that was something that to them means a lot, and it helped them have a strong culture and then also have that kind of great relationship with the US team.

[27:37] And the little things matter, right? So you have to kind of have this travel interaction, right? And so with our India team, I go there twice a year, kind of as the team grows basically 25% of them will visit every quarter. And so over the course of a year you’ll be able to get the entire team to come over and visit, and kind of have that face to face time that help builds that out. And people laugh when I say like 360 reviews. It sounds like a big company thing, but it really just is really simple, right? for as much that you want to give feedback to people you’re working with, you want them to basically give feedback to you. What’s working? Is the time of the call at 10 o’clock appropriate for you? is the time that we’re spending with you to coach your issues or review your code, is that working? Like having your code sit in a review state for two days really doesn’t make you effective. And so how do you work through some of these issues? And having that kind of constant communication back and forth really helped us kind of integrate the team into Acompli. But also in the past at Zimbra we had that same type of approach.

[28:30] And so one of the tricks to kind of doing this if you don’t want to kind of commit to say, “Hey, I’m starting an office” and building a team straight away, is to kind of work wwith some kind of offshore vendor. So Kyle [inaudible] introduced us to a company called Testlio, which is an Astonian based company, a super small company that’s really focused on mobile QA. And then in addition to that, we’ve worked with two other kind of what I would call traditional services companies in India. And so the cool thing about the traditional services companies is they’re super hungry for work and so we haven’t paid them for like the first three or four months, like of the project they were testing through this. And so they were doing the work for free just to kind of earn the work and kind of show us that they know what they’re doing. And so that’s something that, if you’re doing a project that they’re interested in going after or a market they’re interested in getting in, you can get up kind of a lot of free samples to kind of work through the process and really find the right one. It doesn’t cost you a lot to interview these people. Testlio was a smaller company, but the commitment for us was very simple. It was hundreds of dollars a month kind of thing to get started and try it out.

[29:29] And so for us, we never wanted to kind of do a whole “build our own manual team.” Cause at Zimbra we had built a huge team of kind of manual testers and it was just, they were never happy being manual testers cause they’d see people next to them doing automation or doing kind of more advanced, they always wanted to get off that team, and it was the hardest position to keep full. And so when we started to build this team out at Acompli we thought through this and said, “Well, look, let’s not hire that team. Let’s only hire automation engineers and use some kind of offshore type approach or a vendor approach to kind of fill the manual testing goal.” So, the nice thing about this is we don’t have to go buy all the devices, which are very expensive in foreign countries because you don’t have the contracts that we have in the US, and so the devices are sometimes $1,000 to go buy an unlocked device. And so these mobile companies already have all those devices, and more importantly, they already have a team of people that are trained in QA for mobile testing and that are familiar with it, they’re smartphone users. And so they’re not like they’re grabbing random people off the street to go test with. And in many cases they either work right in our bug database or in Testlio’s they have a great integration where all the testing they do dumps into our [inaudible] database. And so we get all the bugs locally on our site.

[30:34]] So here the, this is just a screenshot of what Testlio does, and they have like this test matrix they go through and they do “pass” “fail”, and so it’s awesome. So every day on every Friday we release a new build to our staging environment, they pick it up, they test with eight or nine people all weekend, and then on Monday morning we show up and they give us a report and told us what was working, what didn’t work and whether or not, you know, we should ship the build to our customers. And so the kind of the ROI here is that they’ve already got the pre-screened people for you. You don’t have to go through the practice of hiring them. They do build the team, and in this case it works really well. And they already have great QA practices, right? So they understand when they find a bug, if it’s not straight forward, they take a video of it, they upload all the log files and they make it really easy for us to reproduce things.

[31:14] But even with this, we still have to find ways to make sure that they’re successful and that they’re providing good value to us. And so some of the metrics we look at is, what is the dollars per bug? Like how much are we paying for every bug that they find? So on a weekly or monthly basis, we total up all the bugs they found, divide by what we paid them and see if that rate still make sense for us to keep doing that. And we also look at the quality of the work they’ve done, right? Are they finding like complaining about little UI lint or are they actually complaining about like, “Hey we crashed the app cause we loaded up 500 folders and the app crashed.”? And so that is something that is important to us. And then just flexibility. So like, I want to be able to call them and say, “Hey this week don’t test this area, go test calendar because we made a bunch of changes in calendar.” And so that is something that’s been super helpful for us.

[32:00] So in closing, this is my last slide. You know, so starting from the high level, right? Always thinks in terms of what your cost benefit is, and kind of what’s the ROI that you’re imploding, right? It’s gonna take time to set this up. It’s gonna take time for you to break tasks into smaller pieces and work with people that you haven’t worked with before. Make sure that you’re getting a return on that, right? That you’re not spending a lot of time doing things that you could have done quicker yourself. But if you do it small and work through it slowly, you’ll be able to provide a way to get a better ROI.

[32:28] And then just start personally, right? The reason I walked through all of the kind of personal productivity hacks first is that kind of my adventure into this process is I learned how to break things into small pieces and always thinking like, when somebody asked me to do something, I say, “how can I have somebody else do it?” Right? And not in the sense that I’m fully lazy. I’m a little bit lazy, but also in the sense that a lot of times other people are better at doing this than I am. And if you always kind of hit it with that filter, you can constantly look for areas to kind of increase your own personal productivity. And then once you kind of get good at that and delegating small pieces of your life to other people or to having small tasks that are on your plate done by a remote worker or an outsource person, then you can start to integrate some of those practices into your company. And so to me at this point, it comes very naturally to start up a team in a remote country and just how you would manage them and how you would work through that, or go and negotiate with vendors to have a vendor relationship to do testing or something like that. It’s pretty straight forward.

[33:19] And then the final thing is use this as stepping stones to get yourself not only individually highly productive, but also kind of your broader team and work like that. So with that, I’m done. Cool. Thank you. 


Mark: [33:41] Yeah, that’s a good question. So I think, I mean, generally every day, I think even today we talk to our India team, at least somebody in the team talks to one person on our team almost every day. So we usually use Skype or HipChat for that. You know, HipChat’s great cause you just work with your phone. But I think we talk to them every day and I think that it’s like you would talk to all your coworkers every day. So, we don’t talk to every one of them every day, we have weekly calls, but the main process is being able to find a way to communicate effectively. And what process works for you kind of depends on how you’ve set up your communication, and clearly through like bug databases and all the tools being online, you end up seeing a lot of code checkings coming through code reviews and things like that. So some of the communication’s not chat, it’s more of like a, “here’s a code review, review it, send it back type of thing.”

[34:29] It’s random. Yeah. So you see the same people periodically. But I mean, generally you assume it’s no context, and so you have to get good at kind of packaging. You can’t just assume they know what they did yesterday, or in fact you can’t even assume they know what they did with the other task that you submitted five minutes ago.

[34:46] I think it’s less about the— I think they’re all about the same in terms of what they execute. I think the variability comes to how they present themselves. I think the one thing I always like, I like them to pretend like they’re really my assistant. Like, “Hey, I’m Jim calling on behalf of Kevin” rather than saying, “Hey, this is fancy hands” and it kind of like blows my cover. They’re like, I’m just too lazy to do it myself. And so I think that’s the one thing that I put in my profile and I coach them, and some of them fail in that sense. So I think from the quality point of view— Cause it’s great, I have a Gmail Alias set up for my assistant and I can CC them on emails and say, “Hey Jim or Jack is going to go set this up” and it looks like I’m sending it to another person on Gmail, they have a Google plus profile, it looks like a normal person, but behind the scenes it’s all routing into fancy hands. Same thing with a [inaudible]. Like I have all my tasks in [inaudible], I assign one to fancy hands, they pick it up and execute that task as if I did it and they represent me and send from that email address that I gave them.

[35:44] Yeah. So, they’re not great on technical stuff unless— if they need knowledge of like, “Hey go write about why Google analytics sucks and Mixpanel does this or Keen’s better than both of those.” Like that’s a hard thing. It takes too much context. But even something is like, “how would you set up a very complex cluster”, if they can’t find it on the web, if it’s not a Google-able answer or a Google-able topic, I would say that they generally aren’t great at it. Now, there’s a couple people that I’ve had for ghostwriters in the past where they’re very expensive, they’re $70, $80 an hour, and those people can write— I basically pick up the phone and I just talked to them for 10 minutes and just tell them what I want to write, and then they go and draft it. And so that I’ve been more successful with writing kind of more complex pieces, but like the $10 or $12 an hour people that are writing about shoes or writing about urban clothing or the latest hip hop album, it’s a Google-able answer so it’s easy for them to go write about it. But really technical stuff, you really want to find a higher-level writer, and they’re out there. They’re expensive. Right now you’re paying $40, $50 an hour for that kind of a writer. And even then, you need a lot of coaching to kind of get them to go.

[36:51] Yeah, for sure. I mean, so I would say 60% of the people that work for my wife’s company, we found them on oDesk, like the CTO of my wife’s company I hired him for $5 an hour seven years ago as a PHP programmer. And so now he’s the CTO of the company. He took kind of my role when I left the company two years ago. So yeah. So I think we’ve definitely recruited a good number of people. It’s a great place. And you think of most of the people on oDesk come there because they don’t have a permanent job and they want to find a great remote working relationship. And if they see you as a good employer, then they’ll kind of continue to work for you. And he was really young, in this kid’s case, he was really young when I found him. He was five bucks an hour, he was in Serbia. Now he moved to Sweden, he’s married, got a kid and you know, he’s basically full time for my wife’s company as the CTO. And so kind of went through the process of $5 an hour, $7.50, kept walking up the ladder and doing more and more complex tasks. And similar with some of the writers, and actually the designer that did this presentation works for my wife’s company too. And he was a guy we found an oDesk for $10 an hour building ad images for retargeting. And now he does most of the graphic design for my wife’s company

[38:08] They can be. So, oDesk has a service where they call like the W2 service or the 1099 service, they have either one depending on what you want, and they’ll take their 10% cut. But generally we have the discussion that says, “look, do you want to move off oDesk?” Cause that’s a trust thing for them, because then they have to— A lot of times they can’t move off oDesk because they don’t have a way to get the money. Cause oDesk has like a multitude of ways of paying people in very complex situations. And some of these countries, PayPal doesn’t work. And so that’s— Or you can’t make a wire transfer because they don’t have a bank account. So in those cases we leave them on oDesk and they’re kind of full time but still on oDesk. But in the case where they’re like, Hey, I’ll split the fee, let’s cover the 10%. And they make more, we pay less. And it’s in a country or in a way that they can get the money. But yeah.

[38:52] Yeah. So I’m kind of [inaudible]. So, I have like 50 or 60 Google docs that explain like every task I’ve ever hired somebody to do. So like how to be a PHP programmer, how to do Perl code, and what I want you to write, and how I want you to check the code in this very kind of way. And so it’s literally that, it’s all of the things that you’ve seen somebody do wrong over the years, I just keep adding a rule like, “okay when you check coding make sure you strip the white spaces, when you do this, run it through this lint checker for this kind of code” or for writers, “make sure you spellcheck, run it through a grammar checker, use this tool to verify that you’ve done things right.” And so I think those documents, kind of for designers, for PHP, it’s the same thing with job descriptions, right? Like when you hire on these sites, like one of my tricks is just at the bottom, just put like a code, like start the title of your application with “I’m a super star”, “I’m the coolest person ever.” Like, just give them some thing that force them to actually read it to. That way you can delete all the spam applications like in two seconds, right?

[39:47] And so, for the same thing, for like how do you maintain control, and then always use like, I use Google docs or some kind of source control, whatever it happens to be. Always used something where they have to commit that and they have to do it every day. So, the managers that watch all these people in oDesk, they don’t get paid unless they’ve committed whatever work they did. So, if like if I wrote all day and for my four hours, if there’s not a document that was saved from all your writing from that four hours, you don’t get paid for that day. So you have to— cause I don’t want you to go to sleep and then— I’ve heard every excuse, right? “My computer died”, “I moved”, I mean, it’s like every third grade answer you can imagine, these people have come up with over the years of hiring lots and lots of remote workers. And a lot of them are probably true, but it’s just, assume they’re going to be gone the next day. And so kind of if you think with that in mind and give them very specific instructions it works really well. And I think— I don’t know, it sounds like it’s a lot of work, but it’s really not. It’s just like when you have a new employee or even a coworker and you say, “Hey, I need you to do something.” If you aren’t specific enough and they don’t have all the context, it may not get done right. And so it’s just building up that context and understanding the parameters to work with them, and it makes it more successful, right?

[41:02] And that works. I was talking to JJ before [inaudible]. When you start to manage like small teams, like when you’re like a manager of like five people at a company, you can talk to them everyday and you see them, and then you start managing people that are in a different office, and now what you have to do to be successful is different. And then you think of managing a team of a hundred where you start to not know everybody’s name and you’ve never even hired people and you’ve never met them because they’re in a remote office. The way you manage those teams is different. And you start to use more data to manage them. And I think it’s like you bubble this up and say, well, rather than saying, “Hey, did you, this bug today or this task today”, you start saying like, “did this team hit their metrics”, right? And so, Oh, there’s a dev team and they have a thousand bugs, but 10 engineers, are they going to finish the product by this week? Probably not, right? And so you can start to build up high level metrics around that.

[41:49] And so every chunk of work is different for how do you measure success. But having some metric that you can use just like you would deal with an individual and saying, “Hey, you’re four bugs for the day [inaudible] closed, you only got through three quarters of your work”, those same kind of rules apply to remote workers when you think about what did you assign them and how did you do it. And the other trick is hire multiple people for every job, right? So audition more than you need. Always have a backup. So like, for the pro guy, if he disappears one day, I have another pro guy that’s also writing half the code. And so, never let one person do everything. But it’s the same as the company, right? You don’t want one server ops guy, which is what we have at Acomplice, so if Mike ever gets hit by a bus, we’re in trouble, right? Because somebody better know how to run all the scripts to spin up servers at Amazon. Exactly. Be careful on your walkout.

[42:39] It’s a depends. So the financial stuff I’m pretty trusting like in the sense that these days you can go put your credit card out and run up a bunch of payments or lose your credit card and it’s not too hard to get that unwound these days. And so at some level, like when I give the credit card information to the people that have it, so fancy hands refuses to take that information, they’ll only bill a hundred bucks on their credit card and they just back bill it to you. So they won’t actually, they won’t do certain things of that nature. But I have another VA in the Philippines that does have my credit card, but she has a special credit card with $1,000 limit, so she can’t go crazy and build that stuff up.

[43:14] The other thing is like with passwords and stuff, everything’s unique passwords, kind of controlling what data they have access to. So I have a separate Google apps account with a different email address where I keep docs that the VA’s work on and the remote workers work on, so that they don’t have access to my entire, my main Gmail account. They have access to another one. When I want them to do email, I forward the email. I have an email rule that says, “Hey, this chunk of email—” Like if I’m getting, I don’t know, when I was interviewing a lot of people on oDesk, I get all these applications coming in, I just set up a rule to forward them to the VA and say you go do the first pass through them, rather than me looking at those emails. And so I’ve never given full kind of root access to my systems, I guess is one way to do it. But you know, I guess when you hire like a full time person that you trust and you see everyday, then you can kind of loosen that. But with a virtual person, I’d never got fully comfortable letting everything go. And change your passwords every time you lose one, right? I mean, that’s kind of the one password rule.

[44:05] Cool. Thanks guys.


Backing Acompli & the Value of a Veteran Team

Redpoint Partner Satish Dharmaraj and Acompli CEO Javier Soltero discuss how Acompli keeps second time entrepreneurs hungry.

Satish: [00:10] Hi, I’m Satish, I’m [inaudible] partner at RedPoint ventures.

Javier: And I’m Javier Soltero, CEO and cofounder of Acompli.

Satish: [00:20] And if you look at the apps that you use on your phone, after, you know, maybe the browser, maybe Twitter or Facebook, if [inaudible]. I think it’s the email app that you use the most often every day, engagements are off the roof. And yet there’s no real interesting, you know, good email app that really solves the pin point of end users. And so, and Javier was talking about that, I felt that there was a big hole there, and that it was the most important app on your phone, and yet no one was innovating in it.

Javier: [00:59] Yeah. And I had decided that for my own sanity sake, I was kind of done with traditional enterprise companies, and in particular infrastructure ones. So as I started thinking through what kind of things I wanted to do, I wanted to do something that was much more end-user driven. So a piece of software that, at least the way I would have described it then, was adopted and loved by users, even if their IT department didn’t force them to use it.

[01:25] There was a very specific meeting that took place where, and I remember this, and he’s probably regretting that I remember things as clearly as I do, but I do. I sat in his office and he said “man, why isn’t anybody doing like an email thing? Like for real?” And I was like— You remember this now? And it was actually, and I could probably do a better impression of that, but I’m going to—

Satish: You have too much hair for that.

Javier: [01:49] The point is, he was really kind of, frankly, it seemed like it really pissed you off that nobody was really stepping up to the opportunity to do email. And I remember my immediate reaction, you might not remember, but my immediate response to that question was “because you have to be absolutely crazy to start an email company.” And what I meant at that point, you remember that? and I may have used an F bomb or two in that response just, because we were among friends. What happened there was, you know, obviously you had to be crazy because it’s really hard. It’s not because it’s a bad idea, it’s just very, very, very, very difficult. And it’s difficult because I see it as an all or nothing proposition. You either build the right product and it gets massive adoption and you become very, very successful or you languish, and you built something that is sort of a, you know, that people don’t care about.

 [02:42] Satish had convinced a guy named Kevin Henrikson to join Redpoint as an entrepreneur in residence. And Kevin and I had actually gotten to know each other back at VM-ware as part of when we acquired Zimbra at VMware. You know, Kevin was one of the stars of that team. And I always knew him to be an extremely talented dude. And so Satish immediately said, “well, I’m bringing Kevin in as an EIR as well, you should talk to him.”

Satish: [03:08] Six to nine month gig for an EIR, and three weeks into the gig he’s looking at, you know, Javier doing another email company and I’m being involved in it. And he’s like—

Javier: “Oh, I guess I’m doing email again.” Yeah.

Satish: Then the third co-founder, and you know, at that time Javier and I were talking about “Hey, Kevin [inaudible] is a great team, and there’s this guy called JJ who worked at Zimbra and knows all the email and exchange, and end to end stack cold, and great architect. And I said, “Javier, you should meet this guy and he should be a third cofounder” and Javier is going “I don’t need a third cofounder.” And I’m like, “okay, you might be right, but why don’t you just go meet with him and then come back and tell me whether you want him as a cofounder or not.” And so he goes and meets with him and comes back and says, “yeah, I see what you’re saying. We can make him a cofounder.”

Javier: [03:58] I think he was absolutely right. I mean, the skillsets that my two co founders have and the experience that they have that’s unique to tackling a problem as hard as email are impossible to find anywhere in the Valley, anywhere in this country, anywhere in the world. It’s just something that is extraordinarily specialized and a huge reason why we have such a strong team.

[04:23] The first thing you’ll notice is that we’re— I don’t think there’s a single person on our team. In fact, I know that there isn’t a single person on our team who has Acompli as their first starter. And so this kind of veteran angle is really important because people are accustomed to operating in a model, and I mean, in a state where there’s a lot of uncertainty, and the uncertainty comes from different places. There’s uncertainty around what the overall product strategy may be. You know, six or 10 months down the road there’s uncertainty around the economics of the business because, you know, we’re an early stage company. There’s a lot of different angles that if you are not able to keep your sort of act together, if you will, you’d be very, very hard pressed to handle that. As we evolve, it’ll become a more welcoming place, I think for people who maybe would have this be their first starter.

Satish: [05:22] One of the drawbacks that I was thinking about as I was pondering this question and during your answer is you know, sometimes I feel the experience and knowledge is a word, right? Because you’re not as naive as you might be if you know too much about a product. And if anything, that’s a small, I would rather, you know, I rather have people who are super experienced and have a lot of wealth of knowledge in the subject, but you know, sometimes you don’t try blind stupid things when you are not naive and that, you know, in a startup sometimes crazy things lead to crazy outcomes.

Satish: [06:12] Yeah, I think we worry about this a lot when we back founders who had previous successes, and the things that we look for when we back founders who have had previous successes is I think the same thing that other employees who have not had those successes look for when they join a team, which is, are the people who’ve had these successes and are these founders, are they still motivated, hustling, you know, acting like as though they have nothing and starting from the ground up? Or are they getting a little lazy or there’s a little lack of hunger and a lack of hustle as a result of the wealth that they’ve accumulated from the previous exits? So when employees see that, you know, yeah, these guys have had successes, but look, I mean, these guys are fighting ground war and we want to be part of that. I think that motivates everyone and levels the playing field despite the success people have had in the past.

Javier: [07:16] We run things a little differently. Certainly from the way that I ran things on my first time as CEO. Frankly I think I would have— and since you weren’t one of the investors, I can say this even. Well, whatever, it worked out, but I was kind of making it up as I went along. I’m being a little bit more delivered by this time. But you know, we have a lot of different viewpoints and we have a lot of different experiences, by design we’ve brought a lot of different people into the company. And there are places where you need to get insights from everybody in order to arrive at the right answer. JD is a great example. My cofounder and CTO. By personality he’s not the most outspoken guy, and this is his first time as a member of the executive team, as the cofounder of a company. And the amazing thing about that guy is that aside from his technical skills, which are amazing and undisputed, he can chime in on any subject, it could be a go to market discussion or something about the logo, or any aspect of this business. And while he isn’t always right, and frankly, none of us are, it’s just there’s sort of like this wisdom and serenity about him, and unfiltered quality of his comments that it’s a good example to call out, because it’s somebody who’s role typically doesn’t call for that, and in this case we’ve created an environment where that kind of thing is encouraged.

[08:47] And I think more broadly as a company, I tend to run the company with a lot more transparency than I did in the past. For example, we have a board meeting today. Tomorrow we will review the same board deck that I present to the board, gets reviewed with the team, and the team at all times knows exactly where we are, where the expectations of Satish and the rest of our investors are, where my expectations are. And in that we don’t have this kind of like, everybody like talking randomly and throwing wild and crazy ideas. We have, you know, I guess I’m more a steady approach to how we manage this.

I hate Astrology

Since I am one of those steady white collar folk working with computers all day; we all have access to the internet. We love to hate it. You claim to have found the end of the internet almost monthly, growing tired of reading the same news sites everyday, checking your preferred personal email and dabbling on the net with things that interest you or strike your fancy. With this vast knowledge of information and misinformation floating around, it can be hard to justify what is right and wrong in the world today. Well today I know for a fact one thing: Astrology is wrong.

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