Latest / NC Tweener Talks / Scot Wingo: Stingray -> AuctionRover -> ChannelAdvisor -> Spiffy -> Triangle Tweener Fund

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Scot Wingo: Stingray -> AuctionRover -> ChannelAdvisor -> Spiffy -> Triangle Tweener Fund · NC Tweener Talks

• 00:00:03 - Scot Wingo So, so far, the Tweener family has had, you know, the list, which is like the piece of content, and a capital side, which is the fun. And as I talk to founders, what they want is more. More hyperlocal information, this hyper local thing. And maybe it's a post Covid thing. Maybe it's because we don't really have active newspapers anymore. I don't know what's going on, but people want to. And here in the triangle, we have so many people moving here. They want to. They want a better on ramp into the community, and they want to meet people and talk about local things. So there seems to be almost an insatiable appetite on them. 00:00:39 - Jason Gillikin Welcome to episode one of Triangle Tweener talks. I'm Jason Gilliken, CEO of Earfluence, which is proud to partner with the Triangle Tweener Fund to produce this podcast. We'll be sharing stories from founders about how they got to where they are today. And the first founder we're hearing from is the man who will be hosting this podcast, serial entrepreneur and general partner of the Triangle tweener fund, Scott Wingo. Scott, welcome to episode one. 00:01:03 - Scot Wingo This is the first episode, just so people have, if I haven't met you and you don't know who I am, this is a frame of reference for where I'm coming from on this whole thing. So you hear a lot about entrepreneurs like Bill Gates and Mark Zuckerberg, and you think, okay, they were at big cities, and they went to Ivy League schools and got bored with them and dropped out and wrote a formula on their window and then made a billion dollars. That's not my story. So I'm from a small town in South Carolina. It's called Aiken. It's an unusual town in that it has three things. 00:01:33 - Scot Wingo It's near Augusta, which is known for golf, the Masters. So it's a big golf community. It's also a big horse town. So people that are into equestrian sports and any kind of horse riding come to Aiken a lot. So, for example, my high school was the thoroughbreds. 00:01:49 - Scot Wingo That was our mascot. So a lot of horse themes in Aiken. And the third weird thing about Aiken is if you've seen the movie OppenheimeR and you remember kind of the nuclear arms race, all the stuff that they needed for nuclear weapons was sent out to New Mexico. But then Kentucky was a uranium purifying, and uranium was bred near Aiken in the Savannah riverside. A lot of people don't realize that because it's got the word savannah. They don't realize that it's right in Aiken. So half the people in Aiken are kind of poor local folks. I was in that bucket, and then the other half are the kids of PhD physicists that were imported to basically breed uranium. So our science fair was crazy. It was like half. I, for example, had a volcano where you would put this vinegar in there and it would erupt. It was very exciting, and people would hatch chickens. Or we had a kid that did a Geiger counter, a fission reactor. 00:02:45 - Scot Wingo Another guy had an autonomous car, and this is in, like, 1985, that could, like, navigate a room and shoot a nerf rocket at a target from anywhere in the room. So it was a weird high school in that we had basically remedial math and advanced in calculus, ap. So I was fortunate that I could get onto that track on that side. But that was a weird thing about Aiken. 00:03:06 - Scot Wingo There's a very odd town in that way. It kind of reminds me of the movie stranger things. We always would think maybe there was some alien thing going on over then at the facility. Um, also, we have a technical name for it. In Aiken, we call it the bomb plant. So, um, my dad was an entrepreneur, and we didn't even know to call it that. It was really weird in Aiken because all my friends parents worked at the bomb plant. So it was really. It was like, hey, where's your dad work at the bomb plant? You know, does. Mine's in accounting or whatever. And I was like, my dad's self employed, but didn't know to call it entrepreneurship. And what my dad did was programming. 00:03:41 - Scot Wingo So he was a COBOL programmer. Uh, and this is like, before you had c or any of that kind of stuff. You had Fortran and Cobol or some of the earlier programs. And basic was kind of in that genre. So in my house, and I think we'll put a picture up of it. So imagine, like, a 1200 square foot house, and in there, half the house is taken up by a mainframe computer. And so this was highly unusual in this time. And down there's a picture of this. It's called a digital electronics corporation, which was called DEC PDP Eleven. So imagine, like six refrigerator size boxes. So you'd have a cpu box, a memory box, a memory box, a memory box, and two tape spinny boxes. If you've ever seen war games, it's kind of like that with the spinny tape drives. So that's. I grew up with computers, which today is like no big deal. We have, you know, everyone has at least six. But it was highly unusual to have a computer in your house when I grew up. So then, you know, my dad would, like, encourage me to play with computers. So I've been, you know, so at a very early age, I was playing these fun games, like an adventure text game and these types of things. 00:04:46 - Scot Wingo So that was my first kind of brush with entrepreneurship. Yeah. So went to high school, and everything in South Carolina has two choices. So there's north Aiken and South Aiken. So I was zoned for South Aiken, went to South Aiken High School, home of the mighty thoroughbreds, and was always into computers. And in high school, I had my first computer. So I got a TI 99 for a and had a little tape cassette and then got a very early Apple and Apple II. 00:05:11 - Scot Wingo And much to my dad's frustration, I wasn't interested in programming. He thought everyone should know how to program. Being a cobol programmer, I just wanted to play games. So he took another attack versus what I would call the full frontal attack. And he basically one of my wishes, or when I was 17, I wanted a Lamborghini. So that was my dream car. 00:05:33 - Scot Wingo So he kind of said, lamborghinis are expensive. Check out this magazine. And he slid it over to me, and it was a fortune magazine. And it was about the Bill Gates taking Microsoft public. It's an interesting magazine because you may have guessed this, but I was always the nerdiest kid growing up, so it was satisfying to see someone nerdier than me finally. So I felt like, hey, I'm not alone. You can always count on Bill Gate to be nerdier than you are. 00:05:58 - Scot Wingo And then what's interesting looking at this now is it's like they don't use the words initial public offering. Thats part of our vernacular. But they talk about this deal that made Bill Gates at age 3350 million, and they talk about Microsofts stock issue, but its so uncommon at that point in time, its not part of the vernacular. Sure enough, I read that. And also, if you read the Fortune 500 magazine, most of the richest people are founders of companies, be it the Waltons back then or now we have the Elons, the Google founders, so forth and so on, Amazon, Bezos, etcetera. So there's this really clear pattern that if you want a Lamborghini, you need to start a company and take it public. 00:06:37 - Scot Wingo So when I was basically in my teens, I decided that was going to be my goal, that I wanted to be a millionaire by the time I was 30 and then take a company public and get a Lamborghini. So that was my unusual today. We would call those big, hairy, audacious goals. So those were my teenage bhags. Another funny thing is the computer on the bottom left there is called an Apple IIc. The c is for compact. 00:07:01 - Scot Wingo And that was a portable computer. You can see it had a little handle on it, just like a modern laptop. I mean, it's pretty thick, but so you'd walk around, but it didn't operate without that screen. So you'd have this like, you know, ten pound portable part, and then like a, you know, a good 40 pound cathode. Cathode ray tube. We used to call those screens used to be thick, thicker than they are now. And so that was kind of hilarious. That was considered portable back in the day. And then there's two colleges in South Carolina. Clemson. Boo. And South Carolina, and University of South Carolina. So I went there. A lot of people that aren't from the area, they wonder, what is a gamecock? It's an ass kicking chicken. 00:07:38 - Scot Wingo They seem docile, but you get them around certain foes, especially tigers, they get very agitated. I did an internship at NCR and helped them. My uncle worked there and helped me get a job there, doing quality assurance on the software side. And I kind of famously, they had a new operating system. They were about to ship and they wanted me to break it, and I did, and they got very mad at me. I didn't 100% understand that. Turned out I had found this pretty fatal flaw somewhat, just randomly, and saved them a lot by finding that. This will come up later in my story. 00:08:12 - Jason Gillikin What's NCR? 00:08:13 - Scot Wingo National cash register. Okay, gotcha. So they actually made mini computers for a while, and then they did not go well for them. Then graduated, and it was a session, and one of my professors at South Carolina was trying to encourage me to be an entrepreneur. His name was Doctor Pettis, and he knew a guy up here named Doctor Miller. And he got me in touch and said, doctor Miller. He said, doctor Miller has some dollars for folks that are interested in entrepreneurship. You should go see him. So I went with two of my buddies, and Doctor Miller basically recruited us, come to NC State and do a masters. And they would kind of. It wasn't a free ride, but they would give us in state tuition and a stipend and stuff like that. That sounded pretty good to me versus getting a job. So I ended up doing that. What was interesting about Doctor Miller was we didn't really have a formal entrepreneurship thing at NC State at that point in time. 00:09:04 - Scot Wingo This has changed dramatically over the years. But he was kind of like a rogue engineering type that really liked entrepreneurship and he had several students that had been entrepreneurial and he'd like to encourage it. So that came to fruition when I graduated with a master's and I had three job offers. One of them was from IBM, one was from Motorola, and one was from a startup. 00:09:25 - Scot Wingo Now this startup was actually founded by a guy I worked with at NCR and he was like a level away from me, but he had. I was kind of infamous at NCR because I broke this operating system. I was infamous in a kind of a bad way, but some people thought it was good. I didn't get invited back the next summer, but I felt like I was just doing my job. But they didn't like that. I'm not really good at big companies and my dad worked crazy hours, like constantly working whatever waking hours is. He was working that plus five and I thought that's what startups were. But then I went to meet the Bristol guys and they were up in Connecticut and I thought it was an interesting problem. They were taking Windows programs and recompiling them on Unix. That was very much in my technical interest. 00:10:13 - Scot Wingo I was really intrigued by that part of it. It seemed like they weren't going to be like, you have to work 200 hours kind of a thing. So I took that job and went to work for a startup up in Connecticut. The lesson I learned there was back in when I went through engineering, so I did computer engineering both at South Carolina and NC State. The whole idea was engineers are going to stay in their cube and just do engineering. I tried to take some business and econ classes and I basically couldn't ever fit it in. I had to go just basically audit a couple things. And even then they're like, you want a what? They're like, you shouldn't do that. You're not going to be able to do your engineering classes if you're spending time on this. I was like, well, I'm just kind of curious about it today. 00:10:53 - Scot Wingo They've kind of solved that and the kids can go and do whatever they want. So it was like getting an MBA going there. And what I found was I enjoy talking to customers and that kind of thing. So that was good. And then I became a manager, kind of just, bye. I was like employee number three. So once they started hiring engineering folks, they ended up working with me or for me. 00:11:14 - Scot Wingo So that was that path. But then realized I liked startups but did not like living in the northeast. It was just too cold for a South Carolina guy. And there was no way to like a starter home. There was like $2 million, and it was like a hobble. So that was not going to work for me, wanting to start a family and stuff. So moved back to the area and started four companies. 00:11:36 - Scot Wingo The first company, so I had become relatively interested, obsessed with a new programming language called C. So you had C. Then my dad would say, well, remember Cobol starts with C? That was his famous CobOl joke. And then his other one was, there's a new computer that's so fast it can run an infinite loop in an hour. Dad jokes mixed with computers humor. It's a bad category. So C came out, and I loved objective programming and really got into it. And when I was at Bristol, I had the, ultimately, they did a deal with Microsoft. So I had all the source code to windows and everything. So I could see, like inside the guts of all this interesting stuff and figure out how it worked. And so I had like a little bit of an interesting proprietary view into things. 00:12:29 - Scot Wingo So I started, I was so interested in C as a hobby, I would start answering questions on message boards back in the days. And you'll see this is a common pattern. I started answering this question, especially around this one area. So visual c was Microsoft's tool for c. And then it had this foundation classes called the Microsoft foundation classes. So you'd have visual C, and the built on top of that was these objects. And then you'd build your app on those. 00:12:55 - Scot Wingo Well, these objects were hard to figure out, but I had the source code. Everyone didn't know that, but I did. I wasn't publishing anything, but if I had a question, I could go get an answer. I basically had Microsoft level ability to answer questions. So this is when I was at Bristol. I started answering questions on this, and it quickly got to the point where I was answering the same questions. So I developed a frequently asked questions list. I published it. So publishing a list is one of my things. I quickly became well known in that community, and it got to the point where I started to see some of the questions were basically product ideas. So people would say, I want to build a program that does this, but this widget in here only does this. 00:13:36 - Scot Wingo How do I do that? And the answer is like, well, you're going to have to go build your own widget. But you see 50 people asking for that, and you're like, maybe there's something there. So that was the idea for my first company was basically, let's go. I know, I know all the people in this community. I know what they need. Let's go build for them. And they're like me and my other co founders. So myself and two other founders, one of the folks, they're all from NC State and one of them is from South Carolina. 00:14:02 - Scot Wingo We started Stingray software. So three co founders, all technical, and no one wanted to be CEO. So I kind of threw myself on the grenade there and CEO. And the business guy, did you want to, though? I did, yeah. I liked the customer, I didn't. It was conflicting. I still wanted to code, and I did code through most of Stingray, but that was kind of the last time I've coded. Sadly now I'm picking it back up now. But that's like, that's the whole thing. It's like riding a bike. So started Stingray software in 95, bootstrapped that. We tried to raise money. I did, and failed miserably every time. I was not good at it. And basically people would say, basically what they were telling me was the addressable market was too small and I didn't really understand that. 00:14:39 - Scot Wingo Or number two, that because we were profitable, we didn't need venture capital, but we got it up to 10 million. And to grow, we wanted to launch in Europe. And that's why I wanted a couple million dollars to be able to afford to go do that. We weren't making that much money. Whenever we'd make money, we'd have to hire someone because we were growing so fast. 00:14:59 - Scot Wingo So I failed at that pretty miserably. And then I thought, well, how am I going to do this? And I think, well, maybe there's a partner. So we found this public company called Rogue Wave Software, and they were out in Corvallis, Oregon, of all places, out in the middle of nowhere, literally like a cow field. It was a spin out of a university. I can't remember if it's Oregon State or University of Oregon. Sorry, Oregon people, I'm sure they're very passionate about that. Beavers and ducks. So we went to them and said, hey, you guys, they had done c class libraries that were just very generic and not graphical, and they had a huge european in their public, so we could see what was going on. 00:15:36 - Scot Wingo And I said, you guys do a lot in Europe. We'd like you to be a distributor for us. And they said, well, how much would we sell, you think? And I said, well, we're doing ten here. We're on our way to twelve. We think you could do at least 20 there in two or three years, because the products are well formed and we get all this european demand we can't really satisfy. The reason we couldn't sell in Europe is back then, we had to sell our. We actually started this company selling on a floppy disk. 00:15:57 - Scot Wingo So we would send people, like, a stack of 40 floppy disks, believe it or not. And then we got it down to where it would be one cd. But that was distributing software was very complicated, and I'm very happy to be in the cloud world now. So they said, well, why don't we buy you? And we said, we're not really for sale. But then the number got interesting enough so that we did that, and it was about six months before my 30th birthday. So I took the money from that and bought a shiny red Honda Odyssey, because at that point, I had one child and one on the way. And I don't know if you've ever been in a Lamborghini, but you can't really put a car seat in there. 00:16:32 - Scot Wingo And it's not really what I would call a family car. I actually know a fair amount of people that have this kind of cars, and they say, do not get these cars. They're a delight to drive. And then you drive an hour, and then you're, like, in a maintenance cycle. There's a lot of ownership issues and insurance. It's like a whole complicated thing. 00:16:48 - Jason Gillikin So did you reach your goal? Your goal was when you got the Fortune magazine, you want to be a millionaire by the time you were 30. 00:16:53 - Scot Wingo Yep, I got there. Yeah. Nice. Yeah, yeah. It wasn't really the driving. It just kind of happened that way. But, yeah, that was good. So then I had this deadly thing. So I had a lot of money. I'm a big Star wars fan. And episode one was coming out. This is before we knew Jar Jar Binks was going to be in there. So we were all eyes on an OG Star wars fan. I saw Star wars when I was nine, and being stuck in the middle of nowhere. I had a lot of empathy for Luke being stuck on tattooing, the whole foot on the crater thing and all that. Episode one was coming out, and I started buying bigger and bigger and more Star wars stuff. In the earliest days of the Internet, in e commerce, there was more auction sites than fixed price sites, actually. Interestingly, here in the triangle, a founder called Michael Breder Arahe had started a company called Opensight. There was software for running auctions. I found about that later. There ended up being two auction companies in the triangle randomly. We didn't meet each other until a couple of years after founding our things, I thought, what if we built software to go and look across auction sites, bid across search, bid and sell across auction sites? Wouldn't that be interesting? We started auction river. It was almost the exact opposite kind of story of Stingray. So took a lot of the smart people from Stingray, and we literally lived in an office for six months and built this thing and ended up being way harder than I anticipated. Because databases that grow slowly are very static or easy. Databases that change a lot are complicated because you've got this, like, read writes, and the databases, and this is before, this is like old school database on server type technology like SQL Server and Oracle. The problem with auctions is every seven days the database is swapping out. So every day one 7th leaves and one 7th comes in. It's this huge problem to do that. But we figured it out. But it was nontrivial. The day we launched, we issued a press release before we even launched, and we raised money off that press release. So it was cool. That was my 1st $3 million check. That was from Draper, Fisher Jervis, and they had an Atlantic office then in DC. So that was interesting. 00:19:01 - Jason Gillikin Were you actually raising or they just saw the press release? 00:19:03 - Scot Wingo Well, we weren't. We were kind of funding it ourselves. And then I saw it, and I was like, this is DFJ. And we were actually talking to some local guys, and it kind of upset some local guys. They're not with us. So one of them was inter south. South. We had a whole different set of characters back then. Interesting. So there was Aurora, Southeast interactive, and inner south. Inner south and Aurora are still kind of, I think there's a tale of their investments, but Southeast interactive kind of imploded, and it's no longer with us. One of the reasons I wasn't particularly interested in the local guys money is they had this history previously of investing and then kind of nuking the founder and putting their folks in, which they had done like three or four times. So I was kind of like, hmm, I really want to just, like, run this in the triangle. We will never have the next bill gates if that happens, right? You can't just like, constantly, like, you know, the founders aren't just like, step one. We need to get them to step 23456. So I wasn't, and I wanted to see how far I could take it. So that was good. And then by the time we had launched the product, we started getting acquisition offers. It was crazy. It was the.com bubble. And then one of them came from the whole business idea was there's this new thing called pay per click. A company called Goto.com invented it. Now, we all know google now, but go to is kind of like lost in the flotsam jetsam of time. But they actually came up with the idea and they started calling to acquire us and we ultimately got acquired by them. So it got to be so crazy. I was kind of like, this would be crazy not to sell right now because it felt like it was just like very bubbly. So they bought us, then they changed their name to overture and then the.com bubble burst. All the auction sites went away, but eBay. So when that happens, you don't need an auction search engine or a bidding engine. But our selling product became very popular for eBay sellers, what you call power sellers. Back then, ebay was largely beanie babies, believe it or not. Do you remember the beanie baby, Chris? 00:20:49 - Jason Gillikin Oh yeah. 00:20:50 - Scot Wingo The lady die bear was like the big one and went for like thousands of dollars and there was very limited supply. So what happened is people were using our software and we made it better and improved it for selling on eBay. It was 20 a month and we had a fair amount of revenue. And then one day IBM used it to sell thinkpads and they sold $2 million worth of thinkpads on eBay. And it was like eBay computer category was probably a million dollars. So it was like a data point that really stood out at that moment in time. Also, I dont have an MBA but I was like 2 million divided by $20, I think they could probably pay a little bit more. 00:21:24 - Scot Wingo Then shortly thereafter that case study, we didnt even really spread it, but it worked for the industry. Nokia, Motorola, suddenly we had six or seven really big companies using our software. That was interesting. Then right around that time, the CEO of Overture, which was previously known as Goto.com comma, called me and said theres these two guys from Stanford, they have this stupid search engine that's competing with us and they're copying our pay per click. We're going to crush them. But we need money to go buy Altavista Dogpile and two of these other tier two, aka crappy search engines to go compete with them. And I was like, okay, but we have this idea we want to think about spinning out. We were able to negotiate. It was really complicated. He threw some barriers up there. He said, we'll only let you do this if eBay invests. He randomly said that. I think it was, he didn't want us to do it. We ultimately got this guy, Jeff Jordan at eBay to agree to do this, who's now at Andreessen Horowitz. 00:22:14 - Scot Wingo And we were able to spin out in 2001 as channel advisor. And then they went on to acquire all these companies. And then that company we now know as Google, and it just absolutely crushed them. Wow. So Google came up with a better mousetrap than they had and just really got all the wins from paid search. 00:22:33 - Scot Wingo So that's an important, important business lesson there. Don't underestimate your competitors. So then channel advisor, the first era of channel advisor was helping people sell on eBay. And a couple interesting moments from that, this guy calls me one day and he's like, I'm the world's largest Roberto Clemente collector. And as a Star wars collector, I'm like, I don't know anything about baseball. I didn't know who Roberto Clemente was. But this guy was from Chicago and he would walk to the Cubs games and see Roberto. And he was an immigrant like him, like all this kind of stuff, right? And I thought occasionally. So when you would list on eBay with channel Advisor, we would put a little powered by channel advisor attribution on there. And this is how PayPal went viral. So we did the same thing. And he had seen that sometimes buyers would call us, but they wouldn't rattle their way to me. 00:23:23 - Scot Wingo So it was really weird. Someone had made their way to me and he said, and I'm a venture capitalist, and I see channel advisor everywhere on eBay, and I have to understand what you do, how this works. So I explained what we do. Hes like, I want to invest and this is where we were like were kind of self funding it. 00:23:38 - Scot Wingo But he ultimately twisted our arm and we ended up raising around there. And then, to make a long story short, oh, the other big pivotal moment for channel advisor. Theres a million stories in here. One day Amazon called us, and this is when Amazon was only books. So what wed call media book, music, video, DVD's, movies used to come on silver platters, and so did, so did video games and stuff, and so did music. 00:24:02 - Scot Wingo They called and said, this is super, super secret, but we're going to open this thing. We're going to call Amazon Marketplace. And our innovation is we're going to sell right on the item page. So now Amazon had failed three times at this. And this is kind of like how Amazon works. They never give up. So they had done Amazon auctions, Amazon stores, Amazon shops, and then something called like shop Amazon or something, they tried like many many ways to get a of have an eBay like marketplace and it didnt work, but they had found on the, for used books. They didnt want to sell used books but they put them right on the page and then that took off and thats what gave them the idea to build a marketplace. And they said youve got all these eBay sellers on your platform we would love. And wed always had the idea. 00:24:41 - Scot Wingo And way back in auction over, you could sell across platforms, right? So we still had the ability. It was just kind of like eBay was so big, the other platforms didnt matter. But this was Amazon. So I went to the board and said were going to go all in on this Amazon thing and they're like, this is crazy. 00:24:54 - Scot Wingo No one's ever going to buy toys from Amazon. It's a book site. And I was like, I don't know, they seem pretty motivated. So I kind of won that argument, thank God. And we bet really big on Amazon and we were super early on it and that created this huge wave that worked really well for our advantage. Then once Amazon had a marketplace, Walmart added one, target added one, then you had all the chinese ones come up. Alibaba has a whole family of them. And then Mercado libre in Brazil, before you know it, it's 0809. We're at like 60 70 million in revenue, humming along, growing really well. The great financial crisis hits, we make it through that and it was really tough and at this point we've raised 90 million. 00:25:34 - Scot Wingo We got to the other side of that and suddenly a couple of things happened. The other thing that's funny about channel advisors, when I was pitching it to VC's early on, people didn't believe cloud based software would work, so they'd be like, and we didn't know to call it SaaS, we called it aSp. And so we're like, yeah, no, we're not going to ship the software. It's going to be in the cloud. And they're like, there's no way you could do something that's transactional over the cloud. Well, all that hard stuff we had done at auction over this is easier in a weird way. So that kind of, we were so dumb. We happened in this crazy hard problem at auction River. A lot of that technology allowed us to do this on the cloud before. Like this is before AWS existed, right? So it enabled us to be able to do this and whatnot. So that was funny. 00:26:18 - Scot Wingo But then what happened is we got through 0809 and Wall street fell in love with SaaS. What we now know is SaaS. And so Salesforce went public. This company called Omniture went public and they did really, really well. And everyone, all the investment bankers are like, we need everyone. Go find SaaS companies. And there we were. And we had, we just kind of like, stumbled through and ended up being SaaS, not really knowing what SaaS Washington. And we were at the size. So we were able to go public pretty quickly thereafter. 00:26:44 - Jason Gillikin So how many employees do you have at this point? And you've been working at smaller companies. You say you're a small company guy and all of a sudden this is a huge company. 00:26:57 - Scot Wingo So first company, three years, auction Rover, like eight months, and then so channel advisor. So started in zero one, went public in 2013, and at that point we had about 800 employees. 00:27:09 - Jason Gillikin Yeah. And so leading that kind of company with 800 employees, that had to be just a huge change for you. 00:27:15 - Scot Wingo It is. It's really interesting, though. It's a. It's a different problem. And because I have an engineering mindset, it's always like an engineering problem. It's a systems. Like, how do you build these systems? And, you know, so you, at that point in the company, you know, you're having to build an HR system, and it's got a recruiting thing and a lot of software as a service businesses. As we go through these interviews, you're going to hear this common thing. A lot of it becomes like, how many sales reps can you put into the machine? So then, like, how do you build a system to go recruit sales reps, keep them, train them? So we spent a lot of time on that and I find that pretty intellectually pretty interesting. It's not that different than building a product in a way. 00:27:54 - Jason Gillikin Yeah. How do you feel about getting so far away from coding at that point? 00:27:59 - Scot Wingo It's okay. I've had to. I still love coding, but, you know, I'm an introvert and I've had to build extrovert skills. And I, you know, I find, like, once I get over that wall, as an introvert engineering type, I enjoy spending time with people. 00:28:13 - Jason Gillikin Yeah. 00:28:14 - Scot Wingo Yeah. So it's a lot of fun to, you know, some of my, my. One of the reasons I keep doing this is I love building a team that you think couldn't possibly do something and then you do it, and then watching people develop through that part and just, like, watching them, like, rip through problems and solve things, that's kind of the fun part of the whole thing for me. 00:28:33 - Jason Gillikin Yeah, that's awesome. All right, so channel advisor goes public in 2013. 00:28:36 - Scot Wingo Yeah, yeah. And you'll see some pictures there. This is a funny local story here. So I'm there in the middle. Co founder aras to the right on the picture. DavE SPitz there on the left, a couple other folks. Suzanne Maglucci back left, you may know her. Paul. Paul Colucci there between Dave and I. And then who else would you know? And then, oh, Brad Schomburg is there. Link Walls. Ryan Walsh. He's the CEO of Repview. We'll hope to have him on the show. And over on the right is Jason Kaplan. So one of our investors. So the funny story is, ever have that thing with your kids where you do the. 00:29:14 - Scot Wingo What's different between these two pictures? So there's something different about this picture. Can you pick it up? So marketing, this is like the biggest marketing event of any company's life is you're up, you're on tv, you're up at the New York Stock Exchange. And our CMO, Suzanne, there was like, we'd done all this research, and it looks good if you're kind of, like, dressed Summerly. Right? So we all were going to wear, like, a dark black suit. And the same time, Jason shows up in this brown suit. And it's literally, like, from 1970. I was like, did you wear this to your prom? And it's got, like, patches on the arms. He's like, I forgot. I was, like, so stressful to get here. I was going to miss my plane. And so every time you see Jason, ask him about the brown suit. 00:29:57 - Scot Wingo I will. Yes. I'm a CNBC junkie. So part of the highlight was I got to hang out. When you go public at the New York Stock Exchange, one of the benefits is you get to go hang out with the, they used to call it squawk box, but now they call it squawk on the street. So it's Carl Cantonia, Dave. They call him the brain. I forget his last name. And then Jim Cramer. And so I get to meet Jim Cramer. And then if Jim likes you, you get an invite to mad money. So I got to be on mad money a couple times, which was really fun, and I got to play with the soundboard. You like this as a. And actually, you do hear it in there. It's not just, and it's all marked and it's kind of fun to play with his big soundboard. It's amazing where he's got, like, you know, house of pain, all that jazz and the bull and the bear. So, so that was my entrepreneurial journey. So, yep, the one I didn't put in there. So right when we did the channelvisor IPO, we were in New York, and this is kind of, you know, iPhones are out. 00:30:52 - Scot Wingo This channelvisor customer quit his business that he had started and started the startup called Ubertaxi. And his name is Josh. I think he, I think he was like employee number five or six. So I think he did relatively well. And he said, you got to try this. And I was like, I don't know, this is weird. Like getting in a stranger's car. 00:31:09 - Scot Wingo He's like, just try it. So I did it, and it blew my mind. Cause I was like, I just pressed a button on my phone and a car came up and took me. And otherwise I'd be in New York, like, acting like a fool. Like, you know, when you're not a New Yorker, you don't know how all that works. And I can never get a taxi. So that was magical. And then I started thinking, well, we've seen, I like this theme. There's two things I like big analog businesses going digital. That creates a lot of opportunity for technologists. And the other one is there's this classic business book called the Innovator's dilemma. And I've read it, and when you read it, it's very academic. 00:31:39 - Scot Wingo You're like, okay, I get it. But then I've lived it at Channelvisor. I've literally been in more meetings with the CEO of Circuit City. These are all retailers that are out of business. Macy's. Macy's is still in business, but the CEO is no longer. This borders so on and so forth, where they're like, Amazon's not a threat to us. People love our stores and they're going to want to pay more to be in our stores. And you're just like, okay, so the innovator's dilemma is this interesting thing. So if you look at GDP, a third of GDP is products and two thirds is services. So I thought this is going to mean services are going to go digital. That's going to be this huge. 00:32:13 - Scot Wingo This is twice the size of e commerce. It's going to happen faster than Amazon, which is a trillion dollar company now, because Amazon had to get all this groundwork of broadband to the house and payments, all this jazz that we now take for granted, iPhones 4g, going to, that's going to be an exciting area to play in. 00:32:31 - Scot Wingo So I had previously bought a car wash, and as I was thinking about the service economy and where to play in it, I kept coming back to car care because a, I knew a little bit about it and then b, it's one of the, one of those bad experiences. It's not quite. So you've got like a root canal buying a car. For me, going to the doctor in pharmacy and then somewhere kind of in that zone is like getting your car taken care of. 00:32:56 - Jason Gillikin Yeah. 00:32:56 - Scot Wingo So I thought, what if you reimagined car care? What would that look like? It would be digital, so it'd be on your phone or however you, the customer, want to do it. And it would. There's this whole idea of like meet the customer where they are. So if you're at work or home, the car care should come to you and not disrupt your day. There's also this whole framework of a convenience oriented consumer and a value or a consumer that we have in e commerce. So started Spiffy in 20, 1410 years ago to go pursue that. So that's startup number four. 00:33:24 - Jason Gillikin Were you still with channel? 00:33:26 - Scot Wingo So I still was channel advisor for a while. So for a while there I was CEO of one and exec chairman of Spiffy, while my co founder did some of the basic stuff and got it going. And then it got to be the point where I had to kind of pick a lane. And we had, Dave Spitz was our president and he was like, I want to be a CEO someday. And it was a good time for me to kick myself upstairs, become executive chairman. He became CEO of channel advisor. So then I was just kind of like on a quarterly cycle with channel advisor and just quarterly meetings. And then I had a lot more time for Spiffy to finish that up. Channel advisor got acquired in Q four of 22 by a private equity firm and taken private as part of that. So no longer in any way involved. It still exists and is like a thing, but like a kid, it's kind of like out of college, totally off the p and l and doing its own thing. Yeah, yeah, yeah. And they rebranded that to, they combined two companies and rebranded the whole thing to rhythm and. But spelled weird. I couldn't even tell you how to spell. Okay, not a fan of that. But not involved. 00:34:27 - Jason Gillikin But Spiffy went well. 00:34:29 - Scot Wingo Yeah. Yep. So we raised 90 million. We're in 30 locations. We're at about a 65 million run rate right now. I have a co founder there and got to the point with things there where about six weeks, I guess a month and a half ago now. Decided to focus on this tweener stuff full time and explore a couple other things that I was interested in. And then he's going to run with that one. 00:34:53 - Jason Gillikin Nice. 00:34:53 - Scot Wingo Yeah. 00:34:54 - Jason Gillikin So tell us about the triangle Tweener fund. 00:34:56 - Scot Wingo Then the tweener fund started with the tweener list. So if you remember back to my Microsoft foundation for ask questions. I've done a whole bunch of that stuff. So I published a c book, I did an eBay book, I did a bunch of eBay frequently asked questions. So part of my playbook is when I get into one of these spaces, become as knowledgeable about it as I can, and then start publishing stuff. And you kind of become an expert. You're just a self proclaimed expert. 00:35:22 - Jason Gillikin So it was a big deal when the list came out in the triangle and has been for looks like the past nine years or so. 00:35:29 - Scot Wingo Yeah, yeah. It comes forward and the origin of it is in my first business. So I was an engineering person and I literally couldn't take a business class, so I was running Stingray. And once it got up to like 8 million, it got way past my ability to. We hired sales reps and I. When any company gets to 50 people, that's when you get into, like, all these HR issues and things. That helps to have some prior knowledge. So I called Doctor Miller at NC State. He said, you need to talk to Richard Holcomb. 00:35:55 - Scot Wingo So he was ten years older than me. I was like, in my late twenties. He was in his late thirties. And Richard was very generous with his time. And it got to the point in the acquisition towards, like, the last three years, where I was chewing up a fair amount of his time. I tried to say, is there a way I can compensate you? The other thing you find as a founder is there's all kinds of people that want to help you, but they always want to put a hand in your pocket. 00:36:16 - Scot Wingo I had these people like, I'll help you with any acquisition and I want 20% of it. And I'm like, man, that seems high. So I would say no to all that. But Richard never asked for anything, and I tried to pay him and he refused to have it. He basically said, look, we don't have that many entrepreneurs in the triangle, and what I want you to do is pay it forward. So I'm helping you, and someone helped me, and I want you to help in ten years. You help the next generation and they'll help the next, and that's how we build the triangle to be a bigger startup ecosystem. So I committed to that literally in 98 and have been doing it kind of for 26 years, I guess. Oh, wow. 00:36:52 - Scot Wingo Yeah. Yeah. So this is part of my pay it forward part of the program. Yeah. And I wouldn't have been nearly successful. I probably wouldn't have. It wouldn't have worked out at all if it weren't for someone like Richard helping me out. So in 2015, I really. So once you're running a company at like 120 million revenue and you go to zero, you have some extra cycles. And I like to go fast. So I had all this nervous energy. I was like, what can I do? And I started meeting with founders, and what I found is a couple of things. I can have a much bigger impact if they're, like, a little bit further along. When you start a company, you're in this idea phase. Then you go through this thing called product market. They call it PMF. It's really hard to help founders in that journey because you have to just be with them every day. 00:37:38 - Scot Wingo This is why an accelerator or something like that works, because you have to almost coach them daily. I didn't have cycles for that. But then once you get through that, then there's a lot of interesting things that happen. Now you're starting to think, all right, how do I build a sales team? What's the sequence of things I do now? How do I raise money? How do I develop a board? How do I hire? What's the right. All this kind of stuff that I have enough experience at that can help people out. Whereas it's very, if I have a coffee meeting with a founder and they're number one, they want me to tell them if their idea is good or not. And I've realized I am not good at that. There are stories on that, and I don't want to be the Simon Cowell right. That's not my job. So, number two, the coffee meeting is very short because I'm just like, all I know to tell you is build something, get a customer, talk to that customer, iterate, and you. 00:38:26 - Scot Wingo And what happens is just like, talk to customers. Like, it always comes back to that. That's my only secret sauce for getting through it. And that's what all the incubators and the y combinators they ultimately have. That's like, all they're doing is, like, providing a framework to force you to figure out this customer thing. 00:38:41 - Scot Wingo So that's number one. Number two, I started looking out and saying, well, I wonder what's going on in the ecosystem. In the first half of me doing this, we didn't have any founders. So what I would do is evangelize entrepreneurship. So I'd go to schools and do a talk like this. Or I would go meet people at Cisco, IBM, Robbie Allen, who will have on my co GP. I first met him was at Cisco, he had developed this interesting app, it was about tar heel basketball, so you have to kind of forgive that. 00:39:07 - Scot Wingo But it was like, what? It was better than ESPN is today. And this is like in 2015 or 2012 or something like that. And I saw it, I was like, this is crazy. I don't know how you're doing all this real time stuff. And basically what he had done underneath it was what we call, it's not LLMs, but a flavor of AI. So he was on AI like ten years ago, and I was like, you gotta leave Cisco and chase this thing. He's like, what do I do? All these ESPN's calling me and I was like, leave Cisco. Ultimately he did, but it's hard. You're making all this good money, you feel like you're having a forever job and stuff. So that was the first half of my giving back. Then what I realized is we had somehow cracked through that and there's a million reasons why. 00:39:52 - Scot Wingo But suddenly we had this problem of a pipeline problem. And this is a very common thing you see in startups is they'll be like especially founder led sales. You'll have basically two parts of the pipeline leads and basically customers. Well, any salesperson will tell you you want like five or six tiers to a good pipeline lead, qualified lead, you know, considering buying, I've demoed them, we're in contract, something like that. So we had like you know, two in the triangle. We're like, you're a startup or we know you're going to be successful. So we had like 1000 startups, Pindo bandwidth, Sidequest, and all these companies that we channel advisor that we knew were there, Bronto, and we didn't know it was in the middle. 00:40:29 - Scot Wingo So I thought, I can solve that. We need a middle. And because I want to focus on the middle, I think other people do. And if we know the middle is we can get them through faster and then we can go like, you know, it's just basic pipeline stuff. So I thought I will define the middle. And uh, one of my pet peeves is a lot of the entrepreneurial organizations in the triangle. 00:40:48 - Scot Wingo Don't call it the triangle. Whenever I go outside the triangle, I spend a fair amount of time on Sandhill Road and Boston VC's and all over. And they all think of us as the research triangle park where they do commonly abbreviate a triangle. Um, so, a, I wanted whatever I did to have the word triangle, and I'm very passionate about that. And two, I like alliteration. And it was kind of like a Goldilocks list. I didn't want to call it Goldilocks. That's, like, not my vibe. 00:41:10 - Scot Wingo So I came up with this idea of tweener. I did. You can commiserate with this. I had a twelve year old, and we call them tweeners in child development, right? And they're hilarious because they think at this point, that was my youngest and I had two older ones. And my youngest one thought like, she was the cat's pajamas because she was twelve and almost a teenager and going to be 13 next year. And then like, you know, I'm really sophisticated and I whatever, dad. And then run into a glass wall or something. Hilarious like that. They're kind of like, clumsy in a fun way. That's the fun of tweeners. And companies are like that too. 00:41:39 - Scot Wingo They're like, I'm bigger now. I've got all this stuff. I'm going to open an international office. I'm like, just because you got a little bit of revenue, this is not time to start a new product or open international office. I did that triangle tweener. I came up with that. I called it the Triangle tweener list and published it in 2015. What I found when I put all the data in a spreadsheet is if companies had ten employees and up, that was relatively rare. 00:42:04 - Scot Wingo So there's all this brownian motion at under ten employees using the LinkedIn. So I built a crawler to go to LinkedIn and look at the headcount. So LinkedIn gives you an approximation. It goes one to 1011 to 20, so on. So I pulled out in the spreadsheet and I saw there was this kind of interesting breakpoint in the data at ten and over. So I said, that's a tweener. So I kind of arbitrarily drew the line there. And in the software world in early stage, typically can get to $100,000 per employee. So ten people equals about a million in revenue. So that's the, that's the entry point of tweener. Then they had to have an exit point, and that's at 80 million or 800 people. So. So a tweener is triangle headquartered, not life science, not a pure service business. It has to have some form of intellectual property, life science, meaning it has to has FDA approval. So I don't do anything in that world because I don't understand that world, and it's a kind of a different thing. So a million to 80 million in the triangles. That's the triangle. So started this. I could find 50 of them in the triangle. Today, there's 300. So that's grown six x. Wow. Yeah. 00:43:05 - Jason Gillikin Okay. 00:43:06 - Scot Wingo Yeah. So then, over time, you can see here that I started tracking more. I got curious. I was like, well, I wonder. People started saying, well, what happened to the original ones? And I started following them and tracking things. And what's interesting is this algorithm that I came up with, largely just figure out what the middle of the pipeline was. And selfishly, I wanted to figure out. I want to figure out who these four day companies are, and I want to help mentor them to get them. And we, as an ecosystem, should. I started tracking, and what's interesting is you never miss a winner. 00:43:37 - Scot Wingo So every company in the triangle that sold for over 20 million has passed through, because only life sciences kind of stay at zero for a long time and then pop. So every one of our type of companies passes to a million, so you never miss a winner. And then the loss rate goes way down once a company gets to a million, because that's a really good sign you're through. Product market fit. If you can get enough companies to pay you $80,000 a month or a million a year, then your chances of survival in the triangle go way, way up. 00:44:04 - Scot Wingo Because we're not that crazy. We don't do blitz scaling. We're not out there raising 900 million or something like that. Then it's relatively easy to recover once you're at that from any kind of bumps in the. So that was the triangle tweener list. So then around 2022, some of this was instigated by we have a really vibrant crowdfunding group here in the triangle. You probably know Mark Easley and Will Maguire, and there's a set of people that are, like, as excited I am as about tweener stuff. 00:44:32 - Scot Wingo They're as excited about crowdfunding times ten, and they're like, we want to build a crowdfund around this tweener list. I was like, yeah, I don't know how that would work. I like crowdfunding, but it also has a weird side to it, kind of like crypto coins and that you see some of it's real. Like bitcoin feels real and dogecoin doesn't feel real. And so there's some of that stuff on crowdfunding. You see some stuff and you're like, that's a real business. But you see these ones advertised in weird places and it's like a robot that's going to patrol Times Square and it looks like a doctor who dalek. 00:45:05 - Scot Wingo And you're like, this is ridiculous. Some bad guys just going to tip it over. I didn't really want to be associated with that, so I basically said, no, I'm not really interested in that. But it got me thinking. There was another local guy named Anthony Pompliano. He goes by pomp. He's pretty famous influencer. 00:45:22 - Scot Wingo You probably know who he is. He's a bitcoin maximist and he's on CNBC and all this kind of stuff. But he had an investment vehicle on this new thing that Angellist had called a rolling fund, and it's basically a syndicate. So you previously had two ways to invest. You had syndicates. We have a bunch around here, or closed funds. This is kind of like the marriage of the two. So it's committed capital from the investors. You can have a lot of investors in a low check size and you can promote it, which I thought as a marketer, I thought that's going to be pretty important. And then every quarter you get a new pile of money that you can invest from your investors. So I thought, this is perfect. So ended up starting the triangle tweener fund in 2022. The idea was, so Angela said, okay, first of all, I couldn't get in. And then pomp graciously called naval and got me in. So it helps to know important people and call in a favor every once in a while. 00:46:17 - Scot Wingo So thanks to him for that. This would not exist if it wasn't for pomp. And so they got me into this beta program. And then in Q four of 21, I called 20 or 30 founders folks that we're going to have on here. And the, you know, my hit rate was like 95% on yeses. The only people that said no were like doing their own thing, like their own funds and stuff, which I totally understand. Right. So I was like, well, that's interesting. And then Angellist said the average fund starts at, then gets up to an average of 600. So I started doing this. Then we announced it and we had like one hundred k, I think kind of when we soft launched. 00:46:52 - Scot Wingo And then before the end of the first quarter, we had $600,000. And I was like, well, we were planning on writing $50,000 checks and doing four investments a quarter. Well, it ended up being like twelve investments a quarter because it was three x and I had to call a lifeline. So I called Robbie, I was like, I'm in a bit of this thing. Can you help? And he graciously said, yeah. So we'll have him on the show to explain his background in more detail. One quick slide on it. So the fund is basically the investment vehicle built around the tweener list. 00:47:24 - Scot Wingo So it basically says, if you're in the triangle, have to be headquartered in the triangle. Have a pretty generous definition of the triangle. It does not include Wilmington. It does not include the triad. Sorry, sorry. To those folks, this is just. And, you know, I think that's important because that's what resonates with our investors. They want their money to stay in this ecosystem, and they want to. Their investors, they want to make money, but they want to make money by being. They believe so much in this ecosystem. They want their money here. And that's an important part of our promise to them. And then a tweener focus now, 70% to 80% of the dollars go to tweeners. What we found is that's our priority. So every quarter we curate it. And if there's tweeners, that's the priority. Then we will look at add ons. So that's second. So any existing company that's raising around. And the third is if there's any pre tweeners. Again, I've kind of made three tiers here. Pre tweener, tweener and graduate. There are shades of pre tweener. 00:48:15 - Scot Wingo So what we found is if they're at like 40 or 50 a month, kind of MRR and growing nicely, we kind of. That's. We may only have one shot to get in there. So we will do pre tweeners. We do like them to be, you know, only very rarely will we go, if it's a serial entrepreneur or a special situation, we'll go kind of pre revenue, but that's relatively rare. 00:48:34 - Scot Wingo Like maybe one, a quarter, maybe two. And when you have 15 shots on goal, you can do some more stuff like that, right? You don't have to be, as we're writing lots of small checks. That's the whole idea of this index strategy. A good analogy is if you've done any public market investing, there's like the fidelities and Janices or picking your own stocks, right. That's trying to pick winners. And that's what traditional VC does. We're like Vanguard, so we're just like. As Vanguard is to the S and P 500, the tweener fund is to the tweener list, is how I think about it now, super nerds will tell you s and P 500 is a weighted index. 00:49:05 - Scot Wingo We're not a weighted index. So we're more like an algorithm than an index to be super nerdy. I get this question a lot. I hang out with a lot of super nerdy questions, so I have to put out super nerdy qualifiers. So that's it, part of this. So that's. That's like the one level, the level above it of the fund is what we're trying to do is exemplify what we want to. It's like the, you know, it's the quote, gandhi quote, like, you know, be what you want the world to be. You know, you act the way you want the world to act kind of thing. So we're basically trying to say, in a very transparent way, we are a group of now 183 investors that most of us are entrepreneurs in the area, and we're going to support the area. 00:49:49 - Scot Wingo And the implicit contract for these next generation is we're going to invest in your company. And when you have an exit, we would really love for you to kind of like, kind of come back onto the wheel as an investor. So if we do that, we can get this flywheel kind of going faster and faster and faster, build the ecosystem much, much faster. 00:50:05 - Jason Gillikin Yeah. And you're giving back just like your professor had advised you to do. 00:50:08 - Scot Wingo Yeah. And then it's like trying to help other people, like get on the train as well. Yeah, yeah, because it'll be. Teach a man to fish and all that, Jess. 00:50:15 - Jason Gillikin Yep. 00:50:16 - Scot Wingo So the results, you know, first thing is, you know, I underestimated the power of this index strategy. So we punch way above our weight. Since we've started, we've always been by far the largest investor in the southeast. Its funny, its by count, not by dollars, but hey, and then many times weve been the top investor in the country, one of them in Q, four of 22. We were the biggest investor in the country, and Andrew Easton Horowitz was number two. And I imagined bin Horowitz, if youve ever seen him. He cusses like a sailor. I imagine spitting out his Oreos one morning or Cheerios and being like, who the bleep bleep bleep? Or what is a triangle tweener. This works. So through this, weve received inbound about 250 external vc's that are like, we know what the triangle is and we're interested in what's a tweener. And then they find the website, they're like, this is really interesting. And we put on there every company so it's like this database for external vc's. Between the list and the list has 300, we have 120 ish. It's like this really good pr for the areas startup ecosystem. So we just crossed $8 million invested. We're recording this in Q four of 2015 for us. We just wrapped up Q three. So we just made our 166th investment in about 125 companies and we've invested over $8 million. And you can see part of what we want to do is be really transparent. We'll never tell anything about any individual company, but we do roll them up and this gives us, because we see every deal. We have really good data on what's going on in the triangle, what are the valuations, what are companies doing, etcetera and so forth. You can see all kinds of how different people invest, all this kind of stuff, the different rounds we've done. And the sector is interesting, one of the strengths of our ecosystem. We've got the universities and all the stuff around the triangle being a great place to work. But I love the diversity of different types of companies. We're not like Silicon Valley, where everyone's on a crypto for five years and now they're on AI. It creates these crazy boom bust cycles and feast or famine. We're more steady eddy, where we've got such an interesting diversity of things that even if health tech has a down cycle, there's plenty of other stuff going on to make up the slack for that. Then we have lots of companies we invested in. 00:52:31 - Jason Gillikin A quick question. The founders that you invest in or the startups that you invest in, what do you expect from them? Is it, I want an exit in a certain amount of time, or, you know, do you expect to see certain revenue? What's your involvement and expectations of the startups? 00:52:50 - Scot Wingo Yeah, so, you know, this is, it's a high risk game. So, you know, it wouldn't be fair to me say I expect you to succeed, right? And what we expect the founder to do is run their idea to ground as best they can and if they need help, reach out and that's it. And some are going to fail, and I think that's okay. Right? So part of the, part of the culture of being a good startup culture is it's okay to fail. I don't think we have a problem with that. We just haven't had a lot of failures, but we will now. We see the activity really crank up and we need to be really, really gracious. For those folks that have tried it, it usually isn't the founder's fault. It's usually an externality of some kind. They thought the customer wanted this, and it didn't work out. There's a million reasons why these things happen. Sometimes it is the founder tapping out. We would love for founders not to do that, but I'm not going to say to someone, you should have pushed through this mental health, or, I've seen founders quit because they've had a chronic disease that they didn't expect and you cannot expect. If I found out I had something like that, I probably would stop what I'm doing. So it's the golden rule. I can't expect someone else to not do the same thing. The expectation is, do your best, grow hard, yell if you need help, and then let us know how it's going. And so it's usually in the form of a quarterly report, and it's pretty simple of how revenue is going, what's working, what's not working, how can we help you kind of thing. Yeah, because we're on 130 companies. We can't be on the board. So this isn't a typical investment. So usually there is a VC involved and they're doing their thing. We want to be that kind of behind the scenes founder support mechanism that is like a lifeline. It ends up being half tactical stuff. Like, I'm going to hire a BDR. Whatever to get paid in the triangle and do no six, or we end up doing kind of like what I would call founder counseling. Like, not like counseling, but like, because we can be a confidential, trusted, not on the board, and not a co founder, not an employee. People can tell Robbie and I stuff they can't tell other people. 00:54:42 - Jason Gillikin That's mentorship. 00:54:43 - Scot Wingo Yeah, it's mentorship, but it usually is, like a little. Kind of like, it's tough. Like, it's very lonely when you're a CEO, because usually your significant other is like, I'm tired of you complaining about this. I don't know if you ever had that experience. All right, enough work. I don't want to hear. I don't want to hear about influence anymore. So you feel, like, super lonely in that regard. So that's part of the service we provide. I didn't really think that's what it would be, but happy to do it. I've been on the other side of it. It is good to have an outlet. It is mentorship to some degree. 00:55:12 - Jason Gillikin Then what do your lp's expect? 00:55:15 - Scot Wingo Whenever you get into early stage investing, the minimum check size is $20,000. So that's very low in the world of this. You have to be an accredited investor, which you can google that. SEC sets that rule. We don't have, then the average company in a seed is going to have a ten to twelve year exit. That's what they expect is a long term investment cycle in there. You're going to have some failures, you can have some singles, doubles and then wins. And then there's this thing called the power law distribution, if folks are interested in that, where you tend to have these outliers in the triangle, Pindo will be very much an outlier. Where early investors in Pindo, I don't know, they probably make 5000 times like some crazy numbers, right? Uber, Facebook, the usual suspects all have that power law kind of a thing like a one in a thousand type returns. So yeah, so that's, you pull all that together and your typical seed, this is not us guaranteeing, this is like across a wide cohort. No one's done what we're doing and it takes ten years to know if it's going to work. So we do have, it's informed by the list, but past performance is no guarantee for future performance. And all those caveats. Usually you would expect a three to five x on your investment over this ten year period, which if you look at it, is a really good compared to stocks and those things. It also has what you would call alpha. So it goes a different direction when the stock market goes another direction. So it tends to be out of cycle with other things. And that's why a lot of people use this asset class. 00:56:42 - Jason Gillikin Yeah. 00:56:44 - Scot Wingo So last topic is the reason we're here today is to talk about this new podcast. And it's got a sister Substack newsletter. So the substack newsletter is called the Triangle Tweener Times. And this pod is called Triangle tweener talks. So, so far, the tweener family has had the list, which is like the piece of content and a capital side, which is the fund. 00:57:06 - Scot Wingo And as I talk to founders, what they want is more hyper local information, this hyper local thing. And maybe it's a post Covid thing, maybe it's because we don't really have active newspapers anymore. I don't know what's going on, but people want to. And here in the triangle, we have so many people moving here, they want a better on ramp into the community and they want to meet people and talk about local things. 00:57:28 - Scot Wingo So there seems to be almost an insatiable appetite on that. Now, we do have some great news things here in the triangle. So that's not what we're. Those are all good. This is not going to be news. This is going to be more like content from local founders, for local founders. So what are people in the triangle talking about right now? What are some of the issues? What's going on with some of these tweener companies? And then that's going to be the newsletter part. 00:57:51 - Scot Wingo And then the podcast is going to be deep conversations, kind of unfettered by time. This isn't going to be like a ten minute thing to get those startup stories always with a local angle and always with local founders. The different types of folks we want to have on. Here's some pictures. Some of these are already lined up. 00:58:10 - Scot Wingo So also I want to capture some of these stories. I have this concept of there's these generations of founders, and I'm in the middle, if you will. I did my one attempt at this. It's probably not graphically beautiful, but we have what I have calculated to be six generations of founders in the triangle. We've got the ogs, which is like back to gen one. The only one I could think of on a dime was doctor Goodnight at SAS. 00:58:39 - Scot Wingo He's the original gangster of startups in the triangle. Never took a dime built. I think they're like a four or $5 billion private company. Then we have Gen two, and those are the folks in the eighties. And then gen three is in the nineties. And then this is when you founded your first startup. And then in the two thousands, Gen four and then gen five is the then gen six. I didn't represent it here, but when I finished building this slide, you'll see we've invested in 130 companies. Most of them are Gen six. So there's this bend to the curve where we are really adding a lot of great founders. 00:59:16 - Scot Wingo The other thing I will say, this is not a focus of our fund, because if you have two focuses, you've cut a percent of a percent, ends up being an teeny tiny number, and you can't have an index with a teeny tiny number. We do have a lot of diversity of founders in the triangle, and I think that's great. So we've always had a lot of powerful women here. So a lot of folks will know. Jan Davis, Robbie Hardy, not to be confused with Robbie Allen, and just a lot of awesome Bill spruill. Just what traditionally would be underrepresented founders have not been so as represented underrepresented in the triangle. And I think that's like part of a, you know, there's the whole all or welcome here thing on the was it over by pools? You know, we definitely have that vibe in the triangle. 01:00:01 - Scot Wingo And then when people I talk to, because I'm the mayor McCheese, I get to be the welcome wagon for a lot of people that move here, and they're like, I've never been anywhere where people are so open to just talking to me and introducing me into the market. And so those things are important parts of what make us different, and I don't want to lose those as we grow. So, uh, also part of this is going to be making sure we talk about that and highlight it and keep it going forward. 01:00:25 - Jason Gillikin Yeah. And it's not a coincidence that we're recording in a co working space. And I think companies like O'Reilly founded have been so instrumental in the entrepreneurial community also. And so, um, I'm really excited to talk to some of these founders and hear their stories. I see a lot of shark tank people on there also, so it's going to be amazing. 01:00:41 - Scot Wingo Yeah, yeah. It's going to be fun. And, um, look forward to you guys coming along for the ride. It's gonna be a lot of interesting content. And thanks for helping out, Jason. 01:00:49 - Jason Gillikin Of course. Thank you. 01:00:55 - Scot Wingo This podcast was edited and produced by earfluence. For more tweener content, check out the triangle tweener times substack at tweener dot substack.com. thanks for listening, and we'll see you again soon on triangle between our talks.