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# Stance CEO Jeff Kearl: On Skullcandy, Stance, and becoming a founder whisperer
- URL: https://www.ceo.com/episodes/stance-ceo-jeff-kearl-from-logoworks-and-skullcandy-to-stance-socks/
- Published: 2022-09-22T17:00:00.000Z
- Updated: 2026-09-03T23:19:46.000Z
- Description: Jeff Kearl built two consumer brands by finding categories where every product looked the same.
- Author: Clint Betts

# The Sam Goody buyer

A headphone buyer at Sam Goody once placed a $100,000 order with a company that had almost no money and no history. Jeff Kearl called him to ask why.

Kearl was a junior investor at vSpring Capital in Salt Lake City at the time, helping Rick Alden get Skullcandy off the ground on the side. Alden had gone to the Consumer Electronics Show with samples and came back with $900,000 in orders he couldn't pay to fill. Kearl was working the purchase orders one by one, trying to figure out which were real. Sam Goody had more than 1,000 mall stores and sold cassettes and CDs, with a rack of consumer electronics near the register. The buyer had run that rack for 15 or 20 years.

"He proceeded to tell me that the reason he was bringing it in is that Sony, Bose, Sennheiser, and Panasonic were all black and silver," Kearl told the CEO.com Podcast in an interview recorded September 22, 2022\. "They were in the same cardboard box. Their positioning was all the same. The positioning was, 'We sound better than the next guy.' And then he said, 'I looked at the Skullcandy product, and it's in top colors, clear packaging. It doesn't say anything about sound quality. It's all about this contrarian, irreverent lifestyle. And it just felt so differentiated from all the other products I was looking at. So I wanted to give it a chance. So I kicked out Panasonic to make room for Skullcandy.'"

Kearl has been standing in aisles ever since. Sunblock. Luggage. School supplies. He picks a shelf at Target and sizes up every brand on it, looking for the point where a category goes homogenized, and everyone is saying the same thing in the same package. Then he asks whether it would be worth owning the category if he won it. Golf apparel passed that test in the mid-2000s. School supplies did not. Socks did.

He had already been burned once. His first company, Freeport, sold off in pieces in 2000, and he laid off 100 employees. vSpring, where he landed next, was a $125 million fund whose five partners fell out so badly that a key man provision was triggered. He left in June 2004 to run Logoworks with a college friend. [HP agreed to buy the company in April 2007](https://creativepro.com/hp-to-acquire-logoworks-a-web-based-design-service-company-for-small-businesses/?ref=ceo.com), a deal Kearl says was all cash and started with a chance meeting with HP's head of corporate development in a hotel lobby.

Skullcandy ran on a parallel track. Kearl put Alden's CES trip on his own credit card, then talked vSpring partner Greg Warnock into a $250,000 check even though headphones were nowhere in the fund's charter. He recruited Jeremy Andrus to run operations and became chairman. Sales went roughly one million, then nine, then 35, then 75, and kept doubling.

Somewhere in there, a factory in China handed Kearl a pair of the first Beats by Dre headphones. He brought them home to his product team. They looked at the $300 price, checked the retail data, saw that only about 5,000 headphones a month sold at that level, and dismissed it.

"It's a great example of underestimating your competitor, just because they're small," Kearl said.

Beats kept growing in the one place Skullcandy couldn't follow: upmarket. Kearl negotiated a 50-50 merger with Jimmy Iovine. Skullcandy was much bigger, but Beats owned the top of the market, and Kearl argued that a premium brand can always come down while a cheap one can rarely climb. He brought the deal to his board. The private equity investors vetoed it.

The fallout led to Skullcandy going public. Alden could no longer work with the investors, so the company agreed to an IPO in exchange for their leaving the board on listing day. [The registration statement went effective July 19, 2011.](https://www.sec.gov/Archives/edgar/data/0001423542/000119312511191728/ds1mef.htm?ref=ceo.com) [Apple bought Beats for $3 billion in May 2014.](https://www.apple.com/uk/newsroom/2014/05/28Apple-to-Acquire-Beats-Music-Beats-Electronics/?ref=ceo.com)

The sock idea arrived at a breakfast buffet. May 2009, JW Marriott, Shenzhen. Alden started preaching socks and did not stop for the whole meal. Every inch of the body had been branded in apparel except that one. Sock makers put logos high on the leg because embroidery machines couldn't reach the ankle. Stance rebuilt the tooling so the logo could go where people would see it, incorporated in December 2009, and sold its first pair in August 2010 through the same skate and snowboard shops Skullcandy had come up in.

"Demand is created at the specialty level, but it's fulfilled at the mass level," Kearl said. A skate shop knows every product on its wall and can talk about it. An end cap at Target cannot. He thinks a few direct-to-consumer brands learned that the hard way.

The NBA was a marketing play before it was a sales play. Clarke Miyasaki, who had followed Kearl from vSpring to Logoworks to Skullcandy to Stance, modeled every league and celebrity the company could attach itself to. The NBA won because it was sports and it was also culture. Adidas held the apparel deal and had done nothing with socks, so the league was still putting players in plain cotton. At a meeting during All-Star weekend, Miyasaki slid a $1 million check across the table as a minimum royalty guarantee. [In April 2015 the NBA announced Stance as its official on-court sock](https://pr.nba.com/stance-nba-socks?ref=ceo.com), with the Stance logo on every on-court design, which the league called a first.

Two days before the season, the league called with a problem. LeBron James had worn the same cotton sock from a small mill in Minneapolis since middle school and would not put on the new one. Stance got a couple of pairs, loaded cotton onto its knitting machines in San Clemente, and started copying it. The machines kept failing. They had material for about 20 pairs and got two usable ones. There was no time to ship, so an employee flew to Chicago and handed them to James on the massage table before the opener. He wore them.

Nike later took the whole uniform deal and the sock with it. Stance could not match the price.

Kearl left the Stance CEO job in 2019 to join Pelion Venture Partners in Salt Lake City as a managing director. The call came from Blake Modersitzki, who had interviewed Kearl for a job at Novell Ventures in the late 1990s and never made an offer. Kearl did not want to be anyone's consumer specialist. He wanted to invest in anything, and he wanted to do it in Utah, where he believes the next two decades will produce more companies at scale than any market outside New York and Los Angeles. At the bottom of the pandemic, he moved more than half his 401(k) into Zions Bank stock at $18 a share, on the theory that someone has to write the mortgages for all the people those companies will make rich.

He remained Stance's chairman after stepping down as CEO. [Marquee Brands bought the company in November 2025](https://www.businesswire.com/news/home/20251119216623/en/Marquee-Brands-Broadens-Global-Portfolio-with-Strategic-Acquisition-of-Stance?ref=ceo.com) and licensed its operations outside China to United Legwear and Apparel Co. Stance was selling in 42 countries at the time.

```chapters
00:00:00 Introduction To Jeff Kearl
00:01:18 The Rise And Fall Of Vspring
00:10:44 Lessons Learned From Vspring's Dysfunction
00:19:24 Building LogoWorks From Scratch
00:28:10 Selling LogoWorks To HP
00:30:58 Founding And Growing Skullcandy
00:35:44 The Skullcandy-Beats By Dre Near-Merger
00:47:34 Discovering Socks As A Category
00:51:39 Landing The NBA Partnership
00:56:56 Getting LeBron James Into Stance Socks
00:59:43 Returning To Venture Capital At Pelion
01:04:12 Betting Big On Utah's Future
01:08:18 Comparing Utah To Miami And Austin
```

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And<00:03:07.335> I<00:03:07.415> think<00:03:07.576> a<00:03:07.640> lot<00:03:07.801> of<00:03:07.833> that<00:03:08.041> thinking<00:03:08.298> was<00:03:08.459> accurate.

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But<00:03:09.486> for<00:03:09.582> whatever<00:03:09.887> reason,<00:03:10.208> I<00:03:10.288> think<00:03:10.544> Greg<00:03:10.945> and<00:03:11.169> Paul<00:03:11.442> sensed<00:03:11.907> that<00:03:12.612> there<00:03:12.772> was<00:03:13.013> more<00:03:13.173> opportunity<00:03:13.830> than<00:03:14.055> those<00:03:14.311> two<00:03:14.953> competing<00:03:15.498> firms<00:03:15.914> were<00:03:16.075> taking<00:03:16.395> advantage<00:03:16.940> of.

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So<00:03:17.758> they<00:03:17.854> got<00:03:18.062> together<00:03:18.399> with<00:03:18.639> Dinesh<00:03:18.960> Patel,<00:03:19.505> who<00:03:19.585> was<00:03:19.681> sort<00:03:19.858> of<00:03:19.922> the<00:03:20.002> father<00:03:20.403> of<00:03:20.563> biotech.

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He<00:03:21.509> had<00:03:21.685> a<00:03:21.749> company<00:03:22.070> called<00:03:22.246> TheraTec<00:03:22.984> that<00:03:23.160> he<00:03:23.208> sold<00:03:23.513> to<00:03:23.593> Watson<00:03:23.994> Labs<00:03:24.394> for<00:03:24.491> $300<00:03:25.132> million.

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And<00:03:26.174> that<00:03:26.334> doesn't<00:03:26.526> sound<00:03:26.751> like<00:03:26.959> a<00:03:26.975> lot<00:03:27.216> today,<00:03:27.616> but<00:03:27.777> back<00:03:28.001> then,<00:03:28.177> that<00:03:28.322> was<00:03:28.418> an<00:03:28.514> enormous<00:03:29.059> outcome<00:03:29.460> for<00:03:29.620> Utah.

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And<00:03:31.784> he'd<00:03:32.025> been<00:03:33.131> up<00:03:33.243> on<00:03:33.371> the<00:03:33.467> university<00:03:34.093> research<00:03:34.509> campus<00:03:35.535> and<00:03:35.808> sort<00:03:36.032> of<00:03:36.273> knew<00:03:36.593> that<00:03:36.818> whole<00:03:36.994> ecosystem.

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And<00:03:38.421> then<00:03:38.533> Scott<00:03:38.918> Petty<00:03:39.383> had<00:03:39.543> come<00:03:39.719> from<00:03:39.944> Jamba<00:03:40.280> Juice<00:03:40.761> and<00:03:40.889> been<00:03:40.937> a<00:03:41.002> consultant<00:03:41.498> at<00:03:41.707> Bain<00:03:42.060> and<00:03:42.188> had<00:03:42.428> the,<00:03:42.845> the<00:03:43.069> HBS<00:03:43.647> pedigree,<00:03:44.833> sort<00:03:44.929> of<00:03:45.073> checked<00:03:45.394> those<00:03:45.634> boxes.

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And<00:03:47.734> then<00:03:48.215> last<00:03:48.600> but<00:03:48.696> not<00:03:49.017> least,<00:03:49.273> you<00:03:49.353> had<00:03:49.642> Ed<00:03:49.802> Ekstrom,<00:03:50.924> who'd<00:03:51.085> worked<00:03:51.325> at<00:03:51.405> a<00:03:51.421> couple<00:03:51.678> of<00:03:51.822> Utah<00:03:52.143> startups<00:03:52.768> and<00:03:52.880> ended<00:03:53.184> up<00:03:53.409> as<00:03:53.569> kind<00:03:53.729> of<00:03:53.826> a<00:03:53.842> senior<00:03:54.226> executive<00:03:54.804> at<00:03:55.012> Intel<00:03:55.669> and<00:03:56.150> was<00:03:56.374> responsible<00:03:57.112> for<00:03:57.272> getting<00:03:57.673> Intel<00:03:58.058> to<00:03:58.218> open<00:03:58.458> their<00:03:58.555> first<00:03:58.939> Utah<00:03:59.340> office<00:03:59.917> and<00:04:00.879> put<00:04:01.023> some<00:04:01.184> energy<00:04:01.905> into<00:04:02.145> the<00:04:02.225> state<00:04:02.819> via<00:04:03.428> Intel's<00:04:04.005> big<00:04:04.726> footprint,<00:04:05.528> which<00:04:05.752> they<00:04:05.848> had<00:04:06.025> at<00:04:06.153> the<00:04:06.233> time<00:04:06.570> and<00:04:06.650> still<00:04:06.954> do.

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So<00:04:07.916> I<00:04:08.012> think<00:04:08.189> it<00:04:08.237> was<00:04:08.349> an<00:04:08.477> interesting<00:04:08.894> group<00:04:09.134> of<00:04:09.199> 5<00:04:09.535> people.

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I<00:04:10.016> think<00:04:10.241> they<00:04:10.337> needed<00:04:10.737> each<00:04:10.978> other<00:04:11.218> to<00:04:11.299> get<00:04:11.459> the<00:04:11.539> first<00:04:11.860> fund<00:04:12.180> raised.

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It<00:04:12.661> was<00:04:12.870> $125<00:04:13.703> million<00:04:14.264> fund.

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And<00:04:16.412> without<00:04:17.294> all<00:04:17.390> of<00:04:17.550> their<00:04:17.711> collective<00:04:18.208> networks,<00:04:18.704> I'm<00:04:18.833> not<00:04:19.073> sure<00:04:19.330> they<00:04:19.474> could<00:04:19.602> have<00:04:19.714> cobbled<00:04:20.115> the<00:04:20.275> money<00:04:20.580> together.

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And<00:04:22.183> so<00:04:22.343> I<00:04:22.439> think,<00:04:23.001> I<00:04:23.081> think<00:04:23.401> there<00:04:23.642> was<00:04:24.283> a<00:04:24.299> need,<00:04:25.806> but<00:04:25.950> once<00:04:26.126> they<00:04:26.287> all<00:04:26.447> got<00:04:26.671> in<00:04:26.768> a<00:04:26.848> room,<00:04:27.249> they<00:04:27.393> had<00:04:27.489> all<00:04:27.649> been<00:04:28.371> successful<00:04:29.092> to<00:04:29.236> various<00:04:29.637> levels<00:04:31.000> and<00:04:31.096> they<00:04:31.240> all<00:04:31.961> had<00:04:32.138> strong<00:04:32.474> opinions<00:04:33.019> about<00:04:33.340> how<00:04:33.580> they<00:04:33.805> had<00:04:34.286> become<00:04:34.622> successful<00:04:35.424> and<00:04:35.504> they<00:04:35.648> weren't<00:04:35.969> all<00:04:36.065> the<00:04:36.161> same.

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So<00:04:37.332> I<00:04:37.364> think<00:04:37.524> it<00:04:37.588> was<00:04:37.748> hard<00:04:38.133> meshing<00:04:38.470> the<00:04:38.550> values.

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I<00:04:39.335> won't<00:04:39.576> use<00:04:39.752> names,<00:04:40.153> but<00:04:40.297> there<00:04:40.393> was<00:04:40.634> one<00:04:40.874> partner<00:04:41.900> who<00:04:42.076> really<00:04:42.397> valued<00:04:42.942> a<00:04:42.958> thorough<00:04:43.423> investment<00:04:44.064> process.

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Wanted<00:04:44.962> to<00:04:45.106> call<00:04:45.362> references,<00:04:46.228> build<00:04:46.468> returns<00:04:47.029> models,<00:04:47.590> write<00:04:48.167> thoughtful<00:04:48.567> investment<00:04:49.128> memos<00:04:49.609> about<00:04:49.930> the<00:04:50.074> risks<00:04:50.490> of<00:04:50.635> a<00:04:50.955> business,<00:04:51.612> and<00:04:51.772> more<00:04:51.869> importantly,<00:04:52.654> the<00:04:52.798> upside.

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And<00:04:54.160> he<00:04:54.256> felt<00:04:54.561> like,<00:04:54.737> hey,<00:04:54.977> don't<00:04:55.282> ask<00:04:55.538> for<00:04:55.682> my<00:04:55.939> vote<00:04:56.404> if<00:04:56.644> you<00:04:56.724> don't<00:04:57.045> do<00:04:57.301> really<00:04:57.766> thorough<00:04:58.166> work,<00:04:58.807> because<00:04:59.128> I<00:04:59.208> feel<00:04:59.865> a<00:05:00.025> genuine<00:05:00.570> fiduciary<00:05:01.227> duty<00:05:01.628> to<00:05:01.804> our<00:05:02.253> LPs.

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And<00:05:03.374> if<00:05:03.535> you<00:05:03.567> don't<00:05:03.791> do<00:05:03.935> the<00:05:04.031> work,<00:05:04.352> you<00:05:04.512> can't<00:05:04.752> get<00:05:04.913> my<00:05:05.073> vote.

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And<00:05:06.211> some<00:05:06.435> of<00:05:06.579> the<00:05:06.740> other<00:05:06.916> partners,<00:05:07.461> I<00:05:07.557> think,<00:05:07.941> wanted<00:05:08.198> to<00:05:08.278> go<00:05:08.598> quick,<00:05:09.704> quicker,<00:05:10.666> and<00:05:11.099> sort<00:05:11.339> of<00:05:11.387> shoot<00:05:11.644> from<00:05:11.868> the<00:05:11.948> hip.

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Hey,<00:05:12.429> I've<00:05:12.589> known<00:05:12.766> this<00:05:12.990> entrepreneur,<00:05:13.487> I<00:05:13.567> know<00:05:13.952> this<00:05:14.064> space,<00:05:14.690> therefore<00:05:15.154> we<00:05:15.251> should<00:05:15.571> do<00:05:15.812> it.

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That<00:05:16.693> created<00:05:17.094> a<00:05:17.110> lot<00:05:17.271> of<00:05:17.335> friction<00:05:18.441> when<00:05:18.858> businesses<00:05:20.461> were<00:05:20.621> evaluated<00:05:21.503> and<00:05:21.599> assessed<00:05:22.160> and<00:05:22.304> deliberated<00:05:23.266> around<00:05:23.571> how<00:05:23.667> much<00:05:23.908> work<00:05:24.132> had<00:05:24.292> really<00:05:24.533> happened.

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And<00:05:27.050> I<00:05:27.258> think<00:05:27.499> to<00:05:27.579> your<00:05:27.819> point,<00:05:28.460> one<00:05:28.653> thing<00:05:28.797> that<00:05:28.941> I'm<00:05:29.182> proud<00:05:29.502> of<00:05:29.695> is<00:05:29.839> at<00:05:29.999> least<00:05:30.400> the<00:05:30.496> staff,<00:05:31.282> the<00:05:31.378> investment<00:05:31.923> staff,<00:05:32.805> there's<00:05:33.350> a<00:05:33.366> guy<00:05:33.446> named<00:05:33.751> JD<00:05:34.087> Gardner,<00:05:34.552> he<00:05:34.713> joined<00:05:35.033> first.

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I<00:05:35.674> joined<00:05:35.915> about<00:05:36.236> 2<00:05:36.332> months<00:05:36.636> after<00:05:36.973> him.

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And<00:05:38.095> then<00:05:38.255> along<00:05:38.560> the<00:05:38.640> way<00:05:38.897> we<00:05:38.961> had<00:05:39.137> Jaren<00:05:39.522> Paul<00:05:40.243> and,<00:05:41.951> Clark<00:05:42.258> Miyasaki,<00:05:43.131> which<00:05:43.389> were<00:05:43.551> fantastic<00:05:44.343> additions.

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And<00:05:47.348> this<00:05:47.590> team<00:05:47.833> just<00:05:48.156> built,<00:05:48.641> eventually,<00:05:50.321> you<00:05:50.402> know,<00:05:50.741> we<00:05:50.790> had<00:05:51.130> Ildar,<00:05:52.104> and,<00:05:53.564> you<00:05:53.613> know,<00:05:53.742> he's<00:05:53.986> a<00:05:54.051> really<00:05:54.375> intelligent<00:05:55.024> guy.

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And<00:05:55.851> then<00:05:58.204> Gavin<00:05:58.772> Christensen<00:05:59.340> from<00:05:59.470> Kickstart,<00:06:00.634> and<00:06:00.796> that<00:06:01.023> was<00:06:01.184> kind<00:06:01.362> of<00:06:01.443> our<00:06:01.605> investment<00:06:02.187> team<00:06:02.511> supporting<00:06:03.061> the<00:06:03.142> partners.

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And<00:06:03.951> so<00:06:04.113> if<00:06:04.258> you<00:06:04.290> sort<00:06:04.533> of<00:06:04.598> follow<00:06:05.083> the<00:06:05.245> careers<00:06:05.827> of<00:06:05.973> all<00:06:06.135> those<00:06:06.458> folks,<00:06:07.570> Well,<00:06:07.794> they've<00:06:08.019> all<00:06:08.196> gone<00:06:08.501> on<00:06:08.693> to<00:06:08.821> do<00:06:09.062> amazing<00:06:09.784> things,<00:06:10.828> every<00:06:11.068> one<00:06:11.181> of<00:06:11.245> those<00:06:12.288> from<00:06:12.529> the<00:06:12.609> investment.

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I'm<00:06:12.978> pretty<00:06:13.251> sure<00:06:13.636> you<00:06:13.733> could<00:06:13.973> make<00:06:14.150> a<00:06:14.278> case<00:06:14.615> that<00:06:14.776> the<00:06:14.936> net<00:06:15.322> worth<00:06:15.659> today<00:06:17.007> of<00:06:17.328> the<00:06:17.520> 5<00:06:17.906> or<00:06:17.986> 6<00:06:18.307> or<00:06:18.387> 7<00:06:18.724> associates<00:06:19.510> that<00:06:19.735> worked<00:06:20.233> in<00:06:20.393> that<00:06:20.634> shop<00:06:21.677> far<00:06:22.078> exceeds<00:06:22.640> the<00:06:22.704> net<00:06:23.025> worth<00:06:24.069> of<00:06:24.245> the<00:06:24.325> 5<00:06:24.727> partners<00:06:25.353> that<00:06:25.513> were<00:06:25.609> operating<00:06:26.155> at<00:06:26.251> the<00:06:26.332> time.

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So,<00:06:28.402> I<00:06:28.418> don't<00:06:28.595> know,<00:06:28.980> maybe<00:06:29.285> that's<00:06:29.525> an<00:06:29.622> indictment<00:06:30.248> on<00:06:30.344> the<00:06:30.440> succession<00:06:31.146> plan.

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I'm<00:06:32.013> not<00:06:32.190> sure.

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But<00:06:33.489> systematically,<00:06:34.371> every<00:06:34.596> single<00:06:34.916> one<00:06:35.077> of<00:06:35.157> those<00:06:35.397> talented<00:06:35.878> people<00:06:36.360> left<00:06:36.744> and<00:06:36.825> went<00:06:37.065> on<00:06:37.225> to<00:06:37.306> start<00:06:37.707> funds<00:06:38.140> and<00:06:38.508> companies<00:06:39.086> that<00:06:39.230> were<00:06:39.326> successful<00:06:40.192> and<00:06:40.753> made<00:06:41.010> interesting<00:06:41.475> investments<00:06:42.116> that<00:06:42.277> worked<00:06:42.598> out.

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And<00:06:43.496> I<00:06:43.576> think<00:06:43.752> it's<00:06:43.961> a<00:06:44.057> really<00:06:44.458> good<00:06:44.698> group<00:06:44.955> of<00:06:45.083> people<00:06:45.484> and<00:06:45.580> we<00:06:45.741> enjoyed<00:06:46.077> each<00:06:46.286> other.

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I<00:06:47.585> loved<00:06:47.889> working<00:06:48.146> with<00:06:48.306> JD<00:06:48.627> Gardner,<00:06:49.349> thought<00:06:49.493> he<00:06:49.653> was<00:06:49.701> the<00:06:49.750> smartest<00:06:50.391> guy.

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Gavin<00:06:51.177> was<00:06:52.155> really<00:06:52.492> smart<00:06:52.893> even<00:06:53.117> back<00:06:53.358> then.

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And<00:06:54.961> they<00:06:55.041> just,<00:06:56.629> part<00:06:56.805> of<00:06:56.886> being<00:06:57.046> a<00:06:57.110> good<00:06:57.270> investor<00:06:57.832> is<00:06:57.992> your<00:06:58.072> natural<00:06:58.553> disposition.

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Sort<00:07:00.093> of<00:07:00.173> the<00:07:00.318> bedside<00:07:00.815> manner<00:07:01.201> you<00:07:01.297> have<00:07:01.538> with<00:07:01.698> an<00:07:01.842> entrepreneur,<00:07:03.848> how<00:07:04.025> curious<00:07:04.586> and<00:07:04.683> supportive<00:07:05.774> you<00:07:05.934> are<00:07:06.255> versus<00:07:07.860> how<00:07:08.037> critical<00:07:08.839> and<00:07:08.999> prosecutorial<00:07:10.123> you<00:07:10.347> could<00:07:10.604> be.

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And<00:07:12.305> I<00:07:12.434> think<00:07:12.755> all<00:07:12.931> those<00:07:13.252> folks<00:07:13.573> had<00:07:13.733> such<00:07:14.038> great<00:07:15.338> bedside<00:07:15.820> manner<00:07:16.140> with<00:07:16.365> entrepreneurs<00:07:17.890> that<00:07:18.050> it<00:07:18.130> was<00:07:18.227> sort<00:07:18.403> of<00:07:18.483> inevitable<00:07:19.109> that<00:07:19.270> they<00:07:19.430> would<00:07:19.591> become<00:07:20.874> trusted<00:07:21.356> by<00:07:21.516> CEOs<00:07:22.238> and<00:07:22.319> founders<00:07:22.961> and<00:07:23.282> become<00:07:23.619> good<00:07:23.779> investors.

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So<00:07:25.592> long<00:07:25.865> story<00:07:26.170> short,<00:07:26.732> look,<00:07:27.053> I<00:07:27.277> think<00:07:28.015> without<00:07:28.336> exposing<00:07:28.882> all<00:07:28.978> the<00:07:29.123> gory<00:07:29.444> details,<00:07:30.486> Let's<00:07:30.646> just<00:07:30.743> say<00:07:31.127> one<00:07:31.448> partner<00:07:32.586> couldn't<00:07:33.547> really<00:07:34.189> afford<00:07:34.669> his<00:07:34.910> lifestyle.

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And<00:07:37.635> I<00:07:37.715> actually<00:07:38.115> know<00:07:38.276> what<00:07:38.436> they<00:07:38.580> were<00:07:38.676> all<00:07:38.901> worth<00:07:39.237> because<00:07:39.542> I<00:07:39.622> had<00:07:39.782> to<00:07:39.862> file<00:07:40.183> the<00:07:40.359> SBI—<00:07:41.321> the<00:07:41.866> SBA<00:07:42.427> application<00:07:43.469> listed<00:07:43.789> all<00:07:43.901> their<00:07:44.110> assets.

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I'm<00:07:45.761> gonna<00:07:46.033> keep<00:07:46.273> all<00:07:46.370> that<00:07:46.610> private.

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I<00:07:47.043> don't<00:07:47.315> think<00:07:47.476> that<00:07:47.652> does<00:07:47.812> anyone<00:07:48.069> any<00:07:48.357> good,<00:07:48.694> but<00:07:48.934> sure.

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Eventually,<00:07:50.937> I<00:07:51.018> think<00:07:52.364> that<00:07:52.604> led<00:07:52.781> to<00:07:52.845> some<00:07:53.037> of<00:07:53.101> the<00:07:53.181> partners<00:07:53.646> getting<00:07:53.903> pushed<00:07:54.287> out.

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Obviously,<00:07:55.746> a<00:07:55.762> management<00:07:56.323> fee<00:07:56.547> divided<00:07:57.012> by<00:07:57.108> 3<00:07:57.749> is<00:07:57.974> more<00:07:58.150> than<00:07:58.246> a<00:07:58.294> management<00:07:58.807> fee<00:07:59.513> divided<00:07:59.915> by<00:08:00.076> 5.

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So<00:08:01.987> there<00:08:02.148> were<00:08:02.245> some<00:08:02.421> internal<00:08:02.887> dynamics<00:08:03.530> that<00:08:03.674> when<00:08:03.771> people<00:08:04.092> disagreed,<00:08:04.751> it<00:08:04.960> led<00:08:05.153> to,<00:08:05.442> hey,<00:08:05.683> let's<00:08:05.940> vote<00:08:06.100> people<00:08:06.486> off<00:08:06.663> the<00:08:06.823> island,<00:08:08.109> which<00:08:08.334> was<00:08:08.575> really<00:08:08.896> harmful.

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I<00:08:09.539> would<00:08:09.635> say<00:08:09.796> the<00:08:09.876> greatest<00:08:10.342> risk<00:08:10.615> of<00:08:10.744> any<00:08:10.920> venture<00:08:11.242> fund<00:08:12.511> is<00:08:12.848> that<00:08:13.009> the<00:08:13.089> partners<00:08:13.636> one<00:08:13.796> day<00:08:13.973> don't<00:08:14.214> get<00:08:14.375> along,<00:08:15.563> and<00:08:15.981> you<00:08:16.142> as<00:08:16.222> an<00:08:16.319> investor<00:08:16.768> have<00:08:17.267> committed<00:08:17.668> to<00:08:17.813> a<00:08:17.909> 10-year<00:08:18.455> fund.

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And<00:08:20.062> so<00:08:20.319> just<00:08:20.544> like<00:08:20.721> a<00:08:20.801> marriage<00:08:21.347> can<00:08:22.343> fall<00:08:22.568> on<00:08:22.793> rocky<00:08:23.131> times,<00:08:24.480> so<00:08:24.737> can<00:08:24.882> a<00:08:24.898> partnership.

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And<00:08:26.199> if<00:08:26.327> you're<00:08:26.504> that<00:08:26.664> investor<00:08:27.210> with<00:08:27.371> a<00:08:27.467> long-term<00:08:28.253> large<00:08:28.671> commitment,<00:08:29.457> that's<00:08:29.698> probably<00:08:29.954> the<00:08:30.035> most<00:08:30.259> troubling<00:08:30.757> thing<00:08:30.917> that<00:08:31.078> can<00:08:31.222> happen.

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And<00:08:32.201> that's<00:08:32.426> really<00:08:32.603> what<00:08:32.747> happened<00:08:33.164> there.

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I<00:08:33.485> think<00:08:33.710> the<00:08:33.806> partners<00:08:34.272> fell<00:08:34.432> out<00:08:34.545> of<00:08:34.609> love<00:08:34.769> with<00:08:34.946> each<00:08:35.235> other,<00:08:36.053> became<00:08:36.374> rocky<00:08:36.840> and<00:08:36.936> strained.

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Then<00:08:38.124> it's<00:08:38.284> hard<00:08:38.862> to<00:08:38.942> make<00:08:39.183> good<00:08:39.343> investments,<00:08:39.985> have<00:08:40.210> clear<00:08:40.467> thinking.

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You're<00:08:42.120> managing<00:08:42.634> politics<00:08:43.436> instead<00:08:43.693> of<00:08:43.837> the<00:08:43.982> risks<00:08:44.335> of<00:08:44.479> the<00:08:44.560> companies<00:08:44.961> you're<00:08:45.121> investing<00:08:45.667> in.

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Once<00:08:47.368> partners<00:08:47.802> started<00:08:48.251> to<00:08:48.411> leave,<00:08:49.198> two<00:08:49.310> of<00:08:49.374> the<00:08:49.455> partners<00:08:49.920> were<00:08:50.016> pushed<00:08:50.482> out<00:08:50.658> forcefully,<00:08:51.878> I<00:08:52.023> think<00:08:52.826> you<00:08:52.970> could<00:08:53.131> argue<00:08:53.548> unfairly.

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And<00:08:56.037> then<00:08:56.197> eventually<00:08:57.145> one<00:08:57.305> of<00:08:57.546> these<00:08:57.803> partners<00:08:58.285> who<00:08:58.429> was<00:08:58.670> left<00:08:59.071> that<00:08:59.232> was<00:08:59.409> not<00:08:59.650> living<00:08:59.874> within<00:09:00.131> his<00:09:00.356> means,<00:09:00.613> that<00:09:00.773> all<00:09:00.918> became<00:09:01.271> exposed.

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A<00:09:02.058> bunch<00:09:02.299> of<00:09:02.363> the<00:09:02.524> loans<00:09:02.861> that<00:09:03.005> he<00:09:03.102> had<00:09:03.278> around<00:09:03.583> town<00:09:03.985> became<00:09:05.671> widely<00:09:06.072> known<00:09:06.377> public<00:09:06.795> knowledge,<00:09:07.196> including<00:09:07.597> by<00:09:07.758> some<00:09:07.999> of<00:09:08.143> the<00:09:08.240> LPs.

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That<00:09:09.845> ultimately<00:09:10.423> led<00:09:10.664> to<00:09:10.969> a<00:09:11.210> sort<00:09:11.451> of<00:09:11.547> a<00:09:11.676> key<00:09:11.788> man<00:09:12.173> provision<00:09:12.655> being<00:09:12.896> called.

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Some<00:09:14.180> funds,<00:09:14.823> if<00:09:14.903> you<00:09:15.048> go<00:09:15.128> down<00:09:15.304> to<00:09:15.449> 3<00:09:15.786> people,<00:09:16.204> if<00:09:16.284> you<00:09:16.364> started<00:09:16.733> with<00:09:16.910> 5<00:09:17.167> and<00:09:17.279> you<00:09:17.311> go<00:09:17.456> to<00:09:17.536> 3,<00:09:17.890> that<00:09:18.130> could<00:09:18.275> trigger<00:09:18.580> the<00:09:18.676> key<00:09:18.837> man.

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In<00:09:19.319> this<00:09:19.559> case,<00:09:19.800> I<00:09:19.880> think<00:09:20.057> it<00:09:20.089> was<00:09:20.346> 2<00:09:20.586> people<00:09:20.922> triggered<00:09:21.307> the<00:09:21.403> key<00:09:21.563> man<00:09:21.964> provision.

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One<00:09:23.822> of<00:09:23.886> the<00:09:24.031> LPs<00:09:24.527> took<00:09:24.703> control<00:09:26.113> and<00:09:26.209> they<00:09:26.306> sort<00:09:26.546> of<00:09:26.626> insisted<00:09:27.251> that,<00:09:28.693> you<00:09:28.773> know,<00:09:29.173> they<00:09:29.334> either<00:09:29.494> hire<00:09:29.814> a<00:09:29.830> new<00:09:30.119> partner<00:09:30.840> or<00:09:30.936> merge<00:09:31.256> with<00:09:31.416> another<00:09:31.817> firm.

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At<00:09:32.442> the<00:09:32.522> time,<00:09:33.099> Ron<00:09:33.419> Hines<00:09:34.140> and<00:09:34.284> Brandon<00:09:35.886> were<00:09:35.998> managing,<00:09:37.649> you<00:09:37.761> know,<00:09:37.905> the<00:09:38.049> Raynorda<00:09:38.610> assets<00:09:39.090> down<00:09:39.267> at<00:09:39.347> Canopy,<00:09:40.773> and<00:09:41.013> there<00:09:41.173> were<00:09:41.269> some<00:09:41.494> common<00:09:41.830> LPs.

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And<00:09:43.496> ultimately<00:09:43.993> that<00:09:44.297> group<00:09:44.618> got<00:09:44.954> merged<00:09:45.275> together.

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And<00:09:45.915> I<00:09:46.076> think<00:09:46.300> they<00:09:46.540> really<00:09:46.861> looked<00:09:47.053> at<00:09:47.197> Ron<00:09:47.518> Hines<00:09:48.014> as<00:09:48.222> like,<00:09:48.639> Ron,<00:09:48.959> come<00:09:49.184> in<00:09:49.264> and<00:09:49.424> fix<00:09:49.841> this<00:09:50.081> thing.

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This<00:09:51.123> broken<00:09:51.525> partnership.

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And<00:09:52.986> so<00:09:53.194> I<00:09:53.291> think<00:09:53.515> for<00:09:53.676> a<00:09:53.756> while,<00:09:54.173> Dinesh<00:09:54.655> and<00:09:54.751> Scott<00:09:55.281> sort<00:09:55.474> of<00:09:55.618> continued,<00:09:56.806> uh,<00:09:57.609> with<00:09:57.849> Ron<00:09:58.187> and<00:09:58.347> Brandon.

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Eventually,<00:09:59.679> I<00:09:59.712> think<00:09:59.952> Dinesh<00:10:00.338> kind<00:10:00.514> of<00:10:00.835> retired.

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He'd<00:10:02.505> been<00:10:02.601> doing<00:10:02.842> it<00:10:02.922> for<00:10:03.083> a<00:10:03.163> very<00:10:03.404> long<00:10:03.725> time.

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And<00:10:04.190> I<00:10:04.206> think<00:10:04.383> Scott<00:10:04.832> is<00:10:04.993> the<00:10:05.314> only<00:10:05.972> remaining<00:10:06.935> member<00:10:08.155> of<00:10:08.284> that<00:10:08.460> original<00:10:09.006> vSpring<00:10:09.584> team,<00:10:10.483> still<00:10:11.029> there<00:10:11.574> in<00:10:11.671> the<00:10:11.767> same<00:10:12.072> office,<00:10:12.554> in<00:10:12.698> the<00:10:12.730> same<00:10:13.035> building,<00:10:14.544> doing<00:10:14.801> it<00:10:14.946> after<00:10:15.186> all<00:10:15.299> these<00:10:15.588> years.

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And<00:10:16.246> I<00:10:16.406> joined<00:10:16.727> in<00:10:16.808> the<00:10:16.952> year<00:10:17.129> 2000.

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So,<00:10:18.492> that<00:10:18.637> was<00:10:18.797> 21<00:10:19.214> years<00:10:19.518> ago.

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So,<00:10:20.656> he's<00:10:20.897> been<00:10:21.057> doing<00:10:21.297> it<00:10:21.538> for<00:10:21.618> an<00:10:21.762> awful<00:10:22.003> long<00:10:22.179> time<00:10:22.419> now.

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Scott's<00:10:24.343> great,<00:10:24.663> too.

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I<00:10:25.128> love<00:10:25.369> Scott.

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It's<00:10:27.965> amazing<00:10:28.430> that<00:10:28.655> he's<00:10:28.831> the<00:10:28.975> one<00:10:29.151> who<00:10:29.312> lasted<00:10:29.696> out<00:10:30.097> in<00:10:30.257> that,<00:10:30.738> although<00:10:31.075> everyone's<00:10:31.540> gone<00:10:31.780> on,<00:10:31.940> everyone<00:10:32.421> in<00:10:32.598> the<00:10:32.742> story<00:10:33.239> has<00:10:33.463> gone<00:10:33.704> on<00:10:34.601> to<00:10:34.745> do<00:10:35.002> incredible<00:10:35.483> things,<00:10:36.444> which<00:10:37.150> I<00:10:37.246> find<00:10:37.486> so<00:10:37.647> fascinating<00:10:38.127> from<00:10:38.288> the<00:10:38.368> investment<00:10:38.833> team,<00:10:39.394> from<00:10:39.570> the<00:10:39.650> original<00:10:39.971> 5<00:10:40.147> founders,<00:10:40.997> all<00:10:41.093> of<00:10:41.173> them<00:10:41.317> have<00:10:41.477> done<00:10:41.894> incredible<00:10:42.471> things<00:10:43.176> since<00:10:43.641> VSpring.

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What<00:10:44.555> did<00:10:44.763> you<00:10:44.940> learn<00:10:45.244> personally?

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In<00:10:46.450> that<00:10:46.563> experience<00:10:47.597> that<00:10:47.840> helped<00:10:48.228> you<00:10:49.036> as<00:10:49.214> you<00:10:49.440> left<00:10:49.715> and<00:10:49.844> went<00:10:50.006> on<00:10:50.184> to<00:10:50.264> do<00:10:50.361> other<00:10:50.588> things?

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Yeah,<00:10:52.903> I<00:10:52.984> think<00:10:53.290> one<00:10:53.548> learning<00:10:54.031> that<00:10:54.256> I<00:10:54.434> just<00:10:54.707> take<00:10:54.836> away<00:10:55.013> as<00:10:55.158> an<00:10:55.239> entrepreneur<00:10:56.221> is<00:10:57.236> when<00:10:57.333> you're<00:10:57.478> raising<00:10:57.816> money,<00:10:58.219> you<00:10:58.299> face<00:10:58.638> a<00:10:58.702> tremendous<00:10:59.121> amount<00:10:59.362> of<00:10:59.507> rejection.

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More<00:11:01.348> funds<00:11:01.848> typically<00:11:02.252> say<00:11:02.494> no<00:11:02.817> than<00:11:03.043> yes.

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And<00:11:05.142> I<00:11:05.239> think<00:11:06.272> I<00:11:06.369> could<00:11:06.611> see<00:11:07.160> good<00:11:07.660> investment<00:11:08.209> opportunities<00:11:09.113> getting<00:11:09.436> passed<00:11:09.904> up<00:11:10.082> on<00:11:11.470> because<00:11:11.895> the<00:11:12.026> internal<00:11:12.450> dynamics<00:11:13.087> were<00:11:13.185> so<00:11:13.659> broken.

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And<00:11:14.790> I<00:11:14.838> also<00:11:15.240> saw<00:11:15.802> what<00:11:15.898> I<00:11:16.059> considered<00:11:16.541> really<00:11:16.862> poor<00:11:17.248> investment<00:11:17.746> opportunities<00:11:18.613> that<00:11:18.806> certain<00:11:19.272> partners<00:11:19.818> would<00:11:19.979> chase<00:11:20.381> after<00:11:20.879> for<00:11:21.103> whatever<00:11:21.505> reason.

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My<00:11:23.369> bishop's<00:11:23.835> the<00:11:23.915> CEO<00:11:24.654> or<00:11:25.441> whatever,<00:11:25.859> wherever<00:11:26.196> the<00:11:26.341> opportunity<00:11:26.984> came<00:11:27.305> from.

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And<00:11:27.690> they<00:11:27.851> would<00:11:27.964> feel<00:11:28.494> highly<00:11:28.895> passionate<00:11:29.409> about<00:11:29.715> chasing<00:11:30.261> these<00:11:30.502> below-average<00:11:31.241> companies<00:11:33.169> because<00:11:33.506> of<00:11:33.651> a<00:11:33.731> personal<00:11:34.117> relationship.

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And<00:11:36.286> I<00:11:36.366> think<00:11:36.527> that<00:11:36.687> really<00:11:37.008> exposed,<00:11:37.651> like,<00:11:38.213> I<00:11:38.374> like<00:11:38.551> to<00:11:38.631> tell<00:11:38.872> entrepreneurs,<00:11:39.579> like,<00:11:39.836> don't<00:11:40.077> take<00:11:40.318> it<00:11:40.479> personally.

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Because<00:11:41.844> you<00:11:41.940> never<00:11:42.181> know<00:11:42.567> when<00:11:42.792> a<00:11:42.888> partnership<00:11:43.531> is<00:11:44.157> dysfunctional.

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You<00:11:45.394> never<00:11:45.603> know<00:11:45.763> when<00:11:45.876> a<00:11:45.940> partner's<00:11:46.422> going<00:11:46.727> through<00:11:46.823> a<00:11:46.904> divorce.

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You<00:11:47.642> never<00:11:47.883> know<00:11:48.108> when<00:11:48.349> one<00:11:48.590> partner<00:11:48.976> has<00:11:49.297> already<00:11:49.795> done<00:11:49.971> so<00:11:50.373> many<00:11:50.662> deals<00:11:52.027> out<00:11:52.108> of<00:11:52.204> a<00:11:52.268> fund<00:11:52.606> that<00:11:52.766> their<00:11:52.991> other<00:11:53.232> partners<00:11:53.585> are<00:11:53.730> looking<00:11:53.971> at<00:11:54.099> them<00:11:54.212> like,<00:11:54.453> dude,<00:11:54.677> your<00:11:54.854> pace<00:11:55.191> is<00:11:55.416> crazy.

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You<00:11:56.043> have<00:11:56.284> to<00:11:56.380> slow<00:11:56.685> this<00:11:56.862> down.

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You're<00:11:57.826> going<00:11:57.906> to<00:11:57.938> spend<00:11:58.291> all<00:11:58.404> the<00:11:58.532> capital.

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Um,<00:12:00.460> you<00:12:00.556> know,<00:12:00.942> or<00:12:01.616> if<00:12:01.825> a<00:12:02.564> partner<00:12:03.046> really<00:12:03.768> pounds<00:12:04.234> their<00:12:04.395> fist<00:12:04.652> on<00:12:04.748> a<00:12:04.812> table<00:12:05.278> to<00:12:05.375> get<00:12:05.471> a<00:12:05.535> deal<00:12:05.792> over<00:12:06.178> the<00:12:06.900> finish<00:12:07.222> line,<00:12:07.527> that<00:12:07.864> really<00:12:08.250> doesn't<00:12:08.491> stack<00:12:08.892> up<00:12:09.069> very<00:12:09.374> well.

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Doesn't<00:12:10.577> have<00:12:10.754> a<00:12:10.818> lot<00:12:10.978> of<00:12:11.058> support<00:12:11.395> inside<00:12:11.780> the<00:12:11.860> firm<00:12:12.277> that<00:12:12.422> uses<00:12:12.758> a<00:12:12.823> lot<00:12:13.015> of<00:12:13.079> political<00:12:13.480> capital.

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So<00:12:14.587> then<00:12:14.747> the<00:12:14.779> next<00:12:15.068> deal<00:12:15.244> comes<00:12:15.549> along<00:12:15.821> and<00:12:15.950> even<00:12:16.126> if<00:12:16.367> it<00:12:16.511> is<00:12:16.687> great,<00:12:17.185> sometimes<00:12:17.569> it's<00:12:17.714> hard<00:12:17.890> for<00:12:18.035> them<00:12:18.211> to<00:12:18.291> get<00:12:18.435> it<00:12:18.532> done.

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And<00:12:19.815> as<00:12:19.911> an<00:12:20.039> entrepreneur,<00:12:20.600> you<00:12:20.697> just<00:12:20.857> don't<00:12:21.082> see<00:12:21.723> any<00:12:21.980> of<00:12:22.284> that<00:12:22.605> internal<00:12:23.279> stuff<00:12:23.888> happening<00:12:24.385> in<00:12:24.465> the<00:12:24.610> fund.

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You<00:12:25.588> just<00:12:25.748> get<00:12:25.893> a<00:12:25.909> rejection.

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And<00:12:27.416> so<00:12:27.577> you<00:12:27.673> take<00:12:27.849> it<00:12:27.994> personally<00:12:28.443> and<00:12:28.619> you<00:12:28.651> think<00:12:29.357> my<00:12:29.581> business<00:12:29.918> isn't<00:12:30.223> good.

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Maybe<00:12:31.185> my<00:12:31.361> presentation<00:12:32.147> wasn't<00:12:32.468> good.

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You<00:12:34.007> start<00:12:34.312> to<00:12:34.569> reflect<00:12:34.970> back<00:12:35.146> internally<00:12:35.531> when<00:12:35.691> the<00:12:35.755> reality<00:12:36.397> is<00:12:36.958> the<00:12:36.990> no<00:12:37.375> could<00:12:37.535> simply<00:12:37.936> be<00:12:38.161> for<00:12:38.321> all<00:12:38.418> these<00:12:38.642> other<00:12:38.818> reasons<00:12:39.284> that<00:12:39.444> you<00:12:39.540> can't<00:12:39.797> see.

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And<00:12:41.144> so<00:12:41.866> as<00:12:42.091> I<00:12:42.813> went<00:12:42.909> to<00:12:43.053> fundraise<00:12:43.534> for<00:12:43.599> my<00:12:43.871> companies,<00:12:44.834> I<00:12:45.058> really<00:12:46.021> went<00:12:46.262> in<00:12:46.438> with<00:12:46.599> the<00:12:46.759> view<00:12:47.080> of,<00:12:47.657> I'm<00:12:47.866> gonna<00:12:48.042> try<00:12:48.267> and<00:12:48.363> size<00:12:48.828> up<00:12:49.422> if<00:12:49.566> this<00:12:49.807> partnership<00:12:50.465> feels<00:12:50.834> healthy,<00:12:51.331> if<00:12:51.491> the<00:12:51.572> dynamic<00:12:52.133> between<00:12:52.598> the<00:12:52.759> partners<00:12:53.721> feels<00:12:53.978> healthy<00:12:54.780> in<00:12:54.860> the<00:12:54.924> same<00:12:55.165> way<00:12:55.326> when<00:12:55.486> an<00:12:55.646> entrepreneur<00:12:56.063> comes<00:12:56.288> to<00:12:56.384> present<00:12:56.785> to<00:12:56.882> our<00:12:57.090> whole<00:12:57.331> firm,<00:12:57.828> which<00:12:57.972> is<00:12:58.069> usually<00:12:58.390> the<00:12:58.470> last<00:12:59.753> checkbox<00:13:00.555> before<00:13:00.940> we<00:13:01.261> cut<00:13:01.438> a<00:13:01.518> check.

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I<00:13:03.122> think<00:13:03.523> the<00:13:03.684> entrepreneur<00:13:04.165> is<00:13:04.261> typically<00:13:04.807> focused<00:13:05.352> on<00:13:05.512> the<00:13:05.673> presentation.

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Are<00:13:07.148> my<00:13:07.293> slides<00:13:07.838> right?

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Mm-hmm.

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I<00:13:09.601> don't<00:13:09.778> care<00:13:09.922> about<00:13:10.099> any<00:13:10.275> of<00:13:10.339> that.

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Everyone<00:13:10.884> in<00:13:10.964> the<00:13:11.060> room<00:13:11.317> already<00:13:11.541> knows<00:13:11.846> a<00:13:11.926> lot<00:13:12.039> about<00:13:12.247> the<00:13:12.343> business.

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They've<00:13:12.984> theoretically<00:13:13.722> seen<00:13:14.027> the<00:13:14.171> deck,<00:13:14.572> read<00:13:14.748> the<00:13:14.828> investment<00:13:15.454> memo,<00:13:16.191> thought<00:13:16.512> critically<00:13:16.977> about<00:13:17.233> the<00:13:17.378> opportunity.

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I'm<00:13:19.237> looking<00:13:19.542> to<00:13:19.574> see<00:13:20.344> how<00:13:20.456> much<00:13:20.760> talking<00:13:21.241> does<00:13:21.402> the<00:13:21.482> CEO<00:13:22.107> do<00:13:22.364> relative<00:13:22.845> to<00:13:22.941> the<00:13:23.021> rest<00:13:23.262> of<00:13:23.390> the<00:13:23.486> team<00:13:23.727> members.

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When<00:13:25.170> one<00:13:25.474> person<00:13:25.731> on<00:13:25.875> the<00:13:25.971> team<00:13:26.292> starts<00:13:26.597> talking,<00:13:27.013> do<00:13:27.094> the<00:13:27.334> other<00:13:27.655> team<00:13:27.895> members<00:13:28.296> kind<00:13:28.472> of<00:13:28.617> lean<00:13:29.001> in<00:13:29.819> or<00:13:29.899> do<00:13:30.044> they<00:13:30.140> fold<00:13:30.557> their<00:13:30.845> arms<00:13:31.182> and<00:13:31.743> move<00:13:32.064> back?

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Right.

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I'm<00:13:33.747> trying<00:13:34.004> to<00:13:34.148> understand<00:13:34.549> the<00:13:34.693> team<00:13:34.950> dynamic.

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Of<00:13:38.235> the<00:13:38.380> opportunity<00:13:39.742> more<00:13:39.934> so<00:13:40.158> than<00:13:40.543> get<00:13:40.719> information.

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And<00:13:42.306> I<00:13:42.386> think<00:13:42.562> those<00:13:42.786> little<00:13:43.027> subtle<00:13:43.540> clues<00:13:44.084> around<00:13:45.991> just<00:13:46.648> the<00:13:46.729> way<00:13:46.953> people<00:13:47.289> interact<00:13:47.834> with<00:13:47.995> each<00:13:48.235> other<00:13:49.052> reveal<00:13:49.453> a<00:13:49.613> lot<00:13:50.094> about<00:13:50.478> both<00:13:50.751> a<00:13:50.815> venture<00:13:51.119> capital<00:13:51.520> partnership<00:13:52.722> as<00:13:52.898> well<00:13:53.219> as,<00:13:54.164> you<00:13:54.196> know,<00:13:54.341> an<00:13:54.485> entrepreneurial<00:13:55.142> team,<00:13:56.504> you<00:13:56.584> know,<00:13:56.905> and<00:13:57.049> obviously<00:13:57.449> a<00:13:57.465> high-trust<00:13:58.892> group<00:13:59.453> that<00:13:59.629> likes<00:13:59.949> each<00:14:00.174> other<00:14:00.686> is<00:14:00.783> gonna<00:14:00.991> be<00:14:01.552> so<00:14:01.793> much<00:14:02.017> more<00:14:02.177> effective<00:14:03.476> than<00:14:03.637> the<00:14:03.781> opposite.

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And<00:14:04.840> what<00:14:04.984> I<00:14:05.064> will<00:14:05.241> say<00:14:05.465> about<00:14:05.866> VSpring,<00:14:06.139> sadly,<00:14:06.604> is<00:14:06.748> for<00:14:06.989> whatever<00:14:07.406> reason,<00:14:08.191> the<00:14:08.288> culture<00:14:08.689> became<00:14:09.090> toxic.

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The<00:14:10.212> partners<00:14:10.613> didn't<00:14:10.870> have<00:14:11.030> each<00:14:11.255> other's<00:14:11.575> backs,<00:14:12.682> and<00:14:14.061> you<00:14:14.141> could<00:14:14.302> just<00:14:14.622> see<00:14:15.088> the<00:14:15.168> damage<00:14:15.585> that<00:14:15.745> that<00:14:15.970> caused.

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It<00:14:16.948> unwound<00:14:18.311> what<00:14:18.471> I<00:14:18.696> think<00:14:19.017> was<00:14:19.177> a<00:14:19.257> good<00:14:19.418> opportunity.

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I<00:14:20.075> believe<00:14:20.620> had<00:14:20.797> that<00:14:21.118> team<00:14:21.422> stayed<00:14:21.743> together<00:14:22.962> with<00:14:23.122> the<00:14:23.267> opportunity<00:14:23.924> that<00:14:24.229> Utah<00:14:24.566> has<00:14:24.806> presented<00:14:25.672> over<00:14:25.833> the<00:14:25.913> last<00:14:26.169> 20<00:14:26.554> years,<00:14:27.613> it<00:14:27.758> could<00:14:27.918> have<00:14:28.159> been<00:14:28.400> one<00:14:28.576> of<00:14:28.657> the<00:14:28.801> best<00:14:29.058> returning<00:14:29.524> venture<00:14:29.780> funds<00:14:30.021> of<00:14:30.166> all<00:14:30.326> time.

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The<00:14:31.450> raw<00:14:31.626> material<00:14:32.076> would<00:14:32.172> be<00:14:32.413> like<00:14:33.007> Sequoia,<00:14:33.633> right?

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It<00:14:34.115> could<00:14:34.259> have<00:14:34.420> been<00:14:34.693> something<00:14:36.266> incredible<00:14:36.988> like<00:14:37.229> that,<00:14:37.791> like<00:14:37.967> what<00:14:38.128> Sequoia<00:14:38.610> built<00:14:38.850> or<00:14:39.091> Kleiner<00:14:39.476> Perkins<00:14:40.119> or<00:14:40.777> name<00:14:41.098> the<00:14:41.258> venture<00:14:41.660> fund<00:14:41.917> in<00:14:42.061> Silicon<00:14:42.462> Valley<00:14:43.008> that's<00:14:43.506> done<00:14:43.731> really<00:14:43.971> well.

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I<00:14:44.726> mean,<00:14:44.934> the<00:14:45.031> opportunity<00:14:45.657> was<00:14:45.898> crazy<00:14:47.118> and<00:14:47.198> the<00:14:47.342> timing<00:14:47.936> seemed<00:14:48.241> to<00:14:48.322> be<00:14:48.466> perfect.

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And<00:14:49.269> if<00:14:49.301> you<00:14:49.381> just<00:14:49.606> look<00:14:49.831> at<00:14:49.991> what's<00:14:50.168> happened<00:14:50.970> from<00:14:51.211> then<00:14:51.677> to<00:14:51.773> now<00:14:52.576> in<00:14:52.720> the<00:14:52.752> state<00:14:53.057> of<00:14:53.138> Utah,<00:14:53.459> my<00:14:53.699> goodness.

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Had<00:14:54.823> they<00:14:55.048> just<00:14:55.368> kept<00:14:55.609> that<00:14:55.786> thing<00:14:55.946> together,<00:14:56.331> who<00:14:56.443> knows<00:14:56.732> what<00:14:56.893> would<00:14:56.957> have<00:14:57.053> happened?

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That's<00:14:58.657> why<00:14:58.738> it's<00:14:58.834> such<00:14:58.994> a<00:14:59.075> fascinating<00:14:59.540> story.

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I<00:15:01.241> left<00:15:01.465> the<00:15:01.545> firm<00:15:01.963> in<00:15:02.267> 2004,<00:15:03.551> June<00:15:03.888> of<00:15:03.968> 2004,<00:15:06.038> and<00:15:06.599> so<00:15:06.792> many<00:15:07.017> of<00:15:07.081> the<00:15:07.177> businesses<00:15:07.738> that<00:15:07.963> we<00:15:08.300> looked<00:15:08.685> at<00:15:08.942> investing<00:15:09.487> in<00:15:09.680> or<00:15:09.921> did<00:15:10.209> invest<00:15:10.787> in<00:15:12.391> are<00:15:12.488> still<00:15:12.873> around<00:15:13.290> today<00:15:13.755> as<00:15:13.916> I<00:15:14.076> drive<00:15:14.381> around<00:15:14.718> Utah.

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Like,<00:15:16.707> there<00:15:16.884> was<00:15:17.108> a<00:15:17.285> day<00:15:17.830> when<00:15:18.263> VSpring<00:15:18.633> could<00:15:18.729> have<00:15:18.889> put<00:15:19.515> $4<00:15:19.916> million<00:15:20.654> into<00:15:21.039> Omniture<00:15:21.617> and<00:15:22.002> $8<00:15:22.258> million<00:15:22.724> pre-money.

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And<00:15:24.481> I'll<00:15:24.707> never<00:15:25.095> forget<00:15:25.564> the<00:15:25.661> partner<00:15:26.065> that<00:15:26.291> pounded<00:15:26.631> his<00:15:26.792> fist<00:15:27.051> on<00:15:27.180> the<00:15:27.213> table<00:15:27.601> and<00:15:27.762> said,<00:15:28.732> that<00:15:28.958> entrepreneur<00:15:29.395> is<00:15:29.621> too<00:15:29.847> pigheaded.

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It's<00:15:32.097> like<00:15:34.136> that<00:15:34.379> pigheadedness<00:15:35.431> is<00:15:35.593> what<00:15:35.755> drove<00:15:36.159> one<00:15:36.256> of<00:15:36.321> the<00:15:36.386> greatest<00:15:36.791> outcomes.

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I<00:15:37.211> think<00:15:37.389> if<00:15:37.535> you<00:15:37.697> pulled<00:15:38.441> Site<00:15:38.830> Catalyst<00:15:39.461> out<00:15:39.558> of<00:15:39.850> Adobe,<00:15:41.076> that's<00:15:41.399> probably,<00:15:43.352> I<00:15:43.739> would<00:15:43.836> need<00:15:43.997> to<00:15:44.143> do<00:15:44.255> some<00:15:44.481> math,<00:15:44.966> but<00:15:45.062> I'm<00:15:45.272> guessing<00:15:45.773> it's<00:15:45.999> a<00:15:47.532> not<00:15:47.855> less<00:15:48.113> than<00:15:48.210> a<00:15:48.355> $10<00:15:48.678> billion<00:15:49.307> business,<00:15:49.711> could<00:15:49.873> easily<00:15:50.293> be<00:15:50.454> a<00:15:50.939> $20,<00:15:51.343> $30,<00:15:51.730> $40<00:15:52.134> billion<00:15:52.280> standalone<00:15:52.603> business<00:15:52.861> had<00:15:52.958> it<00:15:52.990> stayed<00:15:53.055> independent<00:15:53.265> all<00:15:55.426> years.

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You<00:15:56.564> know,<00:15:56.965> it's<00:15:57.285> a<00:15:57.301> substantial<00:15:58.007> anchor<00:15:58.327> tenant<00:15:58.712> to<00:15:58.872> Utah.

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And<00:16:00.155> those<00:16:00.395> were<00:16:00.491> the<00:16:00.571> kinds<00:16:00.812> of<00:16:00.892> opportunities<00:16:01.677> we<00:16:01.710> saw<00:16:02.239> one<00:16:02.399> after<00:16:02.735> another<00:16:03.601> at<00:16:03.793> incredibly<00:16:04.483> low<00:16:04.643> prices<00:16:05.140> by<00:16:05.380> today's<00:16:05.733> standards.

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Like,<00:16:06.406> if<00:16:06.567> you'd<00:16:06.647> have<00:16:06.743> taken<00:16:07.064> all<00:16:07.208> those<00:16:07.384> investment<00:16:07.849> opportunities,<00:16:09.548> that<00:16:09.789> fund<00:16:10.109> would've<00:16:10.350> been,<00:16:10.991> you<00:16:11.071> know,<00:16:11.376> off<00:16:11.552> the<00:16:11.632> charts<00:16:11.953> successful.

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But<00:16:13.075> I<00:16:13.155> think<00:16:13.379> the<00:16:13.459> sad<00:16:13.716> part<00:16:14.020> was<00:16:14.197> the<00:16:14.277> original<00:16:14.678> vision<00:16:15.062> was,<00:16:15.704> let's<00:16:15.960> fund<00:16:16.297> the<00:16:16.425> best<00:16:16.681> entrepreneurs<00:16:17.323> in<00:16:17.467> Utah.

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Let's<00:16:18.108> be<00:16:18.204> differentiated.

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Let's<00:16:20.192> add<00:16:20.368> value<00:16:20.689> in<00:16:20.785> a<00:16:20.929> different<00:16:21.250> kind<00:16:21.490> of<00:16:21.571> way.

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Than<00:16:23.078> the<00:16:23.158> incumbent<00:16:23.655> funds<00:16:23.960> were<00:16:24.056> doing.

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And<00:16:25.644> what<00:16:25.804> ended<00:16:26.125> up<00:16:26.285> happening<00:16:26.847> is<00:16:26.943> 10<00:16:27.167> years<00:16:27.488> later,<00:16:27.825> some<00:16:28.065> of<00:16:28.210> those<00:16:28.466> great<00:16:28.787> companies<00:16:30.696> we<00:16:30.952> didn't<00:16:31.273> get<00:16:31.497> to<00:16:31.610> invest<00:16:32.075> in,<00:16:32.315> or<00:16:32.396> we<00:16:32.556> chose<00:16:33.037> not<00:16:33.262> to<00:16:33.358> invest<00:16:33.839> in.

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And<00:16:34.625> then<00:16:34.801> it<00:16:34.961> cuts<00:16:35.266> the<00:16:35.427> opposite<00:16:35.908> way<00:16:36.469> because<00:16:36.790> you're<00:16:36.886> like,<00:16:37.127> wait,<00:16:38.313> how<00:16:38.490> did<00:16:38.730> you<00:16:38.826> miss<00:16:40.238> Omniture?

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How<00:16:41.376> did<00:16:41.601> you<00:16:41.842> miss<00:16:42.724> Qualtrics?

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How<00:16:43.622> did<00:16:43.846> you,<00:16:44.343> like,<00:16:45.145> you<00:16:45.290> were<00:16:45.466> around,<00:16:46.252> those<00:16:46.492> businesses<00:16:46.925> existed,<00:16:48.256> and<00:16:48.353> they<00:16:48.497> were<00:16:48.737> in<00:16:48.850> your<00:16:48.994> stated<00:16:49.411> investment<00:16:49.940> charter,<00:16:50.341> we're<00:16:50.437> going<00:16:50.549> to<00:16:50.678> do<00:16:50.838> the<00:16:50.998> best<00:16:51.383> high-growth<00:16:52.602> tech<00:16:52.859> companies<00:16:53.324> in<00:16:53.484> Utah<00:16:54.366> and<00:16:54.446> you<00:16:54.526> missed<00:16:54.831> them.

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So<00:16:55.809> then<00:16:55.969> your<00:16:56.114> LPs<00:16:56.467> are<00:16:56.595> like,<00:16:56.835> well,<00:16:57.717> like,<00:16:58.375> what<00:16:58.535> are<00:16:58.615> we<00:16:58.776> paying<00:16:59.096> you<00:16:59.257> for?

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If<00:16:59.882> you're<00:16:59.978> not<00:17:00.219> getting<00:17:00.459> the<00:17:00.540> best<00:17:00.844> opportunities<00:17:01.502> in<00:17:01.646> your<00:17:01.887> geography,<00:17:03.105> I<00:17:03.121> might<00:17:03.266> as<00:17:03.426> well<00:17:03.570> just<00:17:03.747> give<00:17:03.971> my<00:17:04.067> money<00:17:04.308> to<00:17:04.388> Accel<00:17:04.869> and<00:17:04.949> Sequoia<00:17:05.494> because<00:17:05.976> ultimately<00:17:06.505> they'll<00:17:06.857> find<00:17:07.114> the<00:17:07.274> best<00:17:07.579> Utah<00:17:07.836> companies<00:17:08.557> when<00:17:08.718> they<00:17:08.798> get<00:17:09.022> big<00:17:09.199> enough,<00:17:09.503> as<00:17:09.664> they<00:17:09.824> did<00:17:10.000> with<00:17:10.193> Qualtrics<00:17:10.722> and<00:17:10.866> others.

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So<00:17:12.951> all<00:17:13.047> of<00:17:13.127> a<00:17:13.143> sudden,<00:17:13.448> from<00:17:13.673> an<00:17:13.753> LP<00:17:14.073> perspective,<00:17:15.132> you<00:17:15.292> talk<00:17:15.597> yourself<00:17:15.998> out<00:17:16.158> of<00:17:16.319> being<00:17:16.495> a<00:17:16.575> regional<00:17:16.976> fund<00:17:17.233> investor<00:17:17.842> pretty<00:17:18.083> quick<00:17:18.484> if<00:17:18.580> the<00:17:18.740> regional<00:17:19.141> fund<00:17:20.168> isn't<00:17:20.441> the<00:17:20.521> seed<00:17:20.826> investor<00:17:21.291> in<00:17:21.387> a<00:17:21.451> lot<00:17:21.627> of<00:17:21.708> the<00:17:21.788> best<00:17:22.028> opportunities.

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Yeah.

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Imagine<00:17:24.274> passing<00:17:24.659> up<00:17:24.755> on<00:17:24.835> like<00:17:25.316> maybe<00:17:25.621> the<00:17:25.958> greatest<00:17:26.343> entrepreneur<00:17:27.000> to<00:17:27.081> come<00:17:27.241> out<00:17:27.337> of<00:17:27.466> Utah<00:17:27.883> the<00:17:28.027> past<00:17:28.219> 20<00:17:28.508> years.

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And<00:17:28.989> Josh,<00:17:30.593> given<00:17:31.155> what<00:17:31.315> he<00:17:31.491> did<00:17:31.732> with<00:17:31.956> Omniture,<00:17:32.598> what<00:17:32.678> he's<00:17:32.855> done<00:17:33.159> with<00:17:34.523> Domo,<00:17:35.742> I<00:17:35.758> mean,<00:17:35.902> there's<00:17:36.062> not<00:17:36.287> too<00:17:36.351> many<00:17:36.544> people<00:17:36.768> who<00:17:36.800> have<00:17:36.945> taken<00:17:37.265> two<00:17:37.490> companies<00:17:37.907> public<00:17:38.404> and<00:17:38.853> had<00:17:38.949> them<00:17:39.030> valued<00:17:39.431> at<00:17:39.511> what<00:17:39.671> they're<00:17:39.815> valued.

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There's<00:17:41.099> not<00:17:41.355> very<00:17:41.532> many<00:17:41.756> people<00:17:41.981> who<00:17:42.141> can<00:17:42.478> do<00:17:42.622> what<00:17:42.799> he's<00:17:42.959> done<00:17:43.200> and<00:17:43.344> just<00:17:43.504> pass<00:17:43.825> that<00:17:44.564> It's<00:17:44.724> crazy.

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It's<00:17:45.704> amazing<00:17:46.716> that<00:17:46.893> pigheadedness,<00:17:47.937> what<00:17:48.162> that<00:17:48.339> can<00:17:48.499> do<00:17:48.596> for<00:17:48.837> you,<00:17:49.061> you<00:17:49.142> know.

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It's<00:17:50.170> actually<00:17:50.475> quite<00:17:50.652> great.

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Incredible<00:17:52.900> value<00:17:53.238> creation,<00:17:54.025> you<00:17:54.121> know,<00:17:54.362> incredible.

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But<00:17:55.310> I<00:17:55.390> mean,<00:17:55.551> it's<00:17:55.711> funny,<00:17:55.968> we<00:17:57.013> recently<00:17:57.719> took<00:17:57.960> over,<00:17:58.282> we<00:17:58.362> made<00:17:58.555> an<00:17:58.699> announcement<00:17:59.342> that<00:17:59.486> we<00:17:59.647> were<00:17:59.743> taking<00:18:00.129> over<00:18:00.386> the<00:18:00.530> crypto<00:18:00.932> assets<00:18:01.398> from<00:18:01.655> Overstock.com.

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Many<00:18:03.534> of<00:18:03.598> those<00:18:03.759> investments<00:18:04.305> happened<00:18:04.578> under<00:18:04.787> Patrick<00:18:05.269> Byrne,<00:18:05.670> and<00:18:06.088> I<00:18:06.168> think<00:18:06.329> their<00:18:06.490> shareholder<00:18:07.052> base<00:18:07.373> was<00:18:07.469> somewhat<00:18:07.935> split<00:18:08.337> between<00:18:09.204> people<00:18:09.477> very<00:18:09.766> happy<00:18:10.120> about<00:18:10.409> those<00:18:10.650> assets<00:18:11.051> on<00:18:11.132> their<00:18:11.228> balance<00:18:11.549> sheet<00:18:11.951> and<00:18:12.496> shareholders<00:18:13.154> probably<00:18:13.634> concerned<00:18:14.131> about<00:18:14.436> them<00:18:14.580> on<00:18:14.676> their<00:18:14.757> balance<00:18:15.077> sheet.

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They<00:18:15.895> just<00:18:16.039> said,<00:18:16.263> let's<00:18:16.504> put<00:18:16.600> them<00:18:16.696> in<00:18:16.760> a<00:18:16.824> fund.

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We'll<00:18:17.562> shift<00:18:17.818> them<00:18:17.963> over<00:18:18.139> to<00:18:18.283> Pelion,<00:18:19.469> have<00:18:19.630> those<00:18:19.870> guys<00:18:20.143> manage<00:18:20.527> these<00:18:20.752> assets<00:18:21.233> out,<00:18:21.489> figure<00:18:21.730> out<00:18:21.890> which<00:18:22.130> ones<00:18:22.451> deserve<00:18:22.756> follow-on<00:18:23.317> financings,<00:18:24.118> which<00:18:24.294> ones<00:18:24.535> don't,<00:18:24.952> et<00:18:25.080> cetera.

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And<00:18:27.565> I<00:18:27.661> pulled<00:18:27.965> out<00:18:28.062> the<00:18:28.142> investment<00:18:28.783> memo<00:18:29.168> that<00:18:29.264> I<00:18:29.488> wrote<00:18:29.905> in<00:18:30.065> 2001,<00:18:31.364> 6<00:18:31.668> months<00:18:31.989> before<00:18:33.335> they<00:18:33.432> went<00:18:33.656> public,<00:18:35.019> and<00:18:35.580> the<00:18:35.676> original<00:18:36.157> Patrick<00:18:36.638> Byrne<00:18:36.878> analysis<00:18:37.840> and<00:18:37.904> why<00:18:38.225> Overstock<00:18:38.738> could<00:18:38.882> be<00:18:38.962> an<00:18:39.058> interesting<00:18:39.587> business.

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They<00:18:40.309> were<00:18:40.405> just<00:18:40.645> entering<00:18:41.062> a<00:18:41.206> partnership<00:18:41.767> with<00:18:41.864> Safeway,<00:18:42.569> which<00:18:42.713> never<00:18:42.970> produced.

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And,<00:18:44.316> you<00:18:44.397> know,<00:18:44.894> these<00:18:45.070> are<00:18:45.135> the<00:18:45.215> kinds<00:18:45.471> of<00:18:45.600> opportunities<00:18:47.220> we<00:18:47.461> looked<00:18:47.765> at<00:18:48.183> in<00:18:48.327> 2001.

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We<00:18:50.092> were<00:18:50.188> going<00:18:50.300> to<00:18:50.428> put<00:18:50.653> $5<00:18:51.086> million<00:18:51.952> in<00:18:52.033> that<00:18:52.273> business<00:18:52.594> and<00:18:52.738> own<00:18:52.851> 13%<00:18:53.573> of<00:18:53.717> it.

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It's<00:18:54.952> like,<00:18:55.642> you<00:18:55.786> look<00:18:55.947> at<00:18:55.979> what<00:18:56.123> that—<00:18:57.150> there's<00:18:57.471> so<00:18:57.712> many<00:18:57.984> of<00:18:58.113> these<00:18:58.353> Utah<00:18:58.674> companies<00:18:59.332> that<00:18:59.476> we've—<00:19:00.294> I<00:19:00.310> mean,<00:19:00.519> Overstock's<00:19:01.096> the<00:19:01.177> kind<00:19:01.401> of<00:19:01.497> business<00:19:01.834> that<00:19:01.979> I<00:19:02.043> think<00:19:02.284> most<00:19:02.460> people<00:19:02.636> in<00:19:02.765> Utah<00:19:02.925> have<00:19:03.086> almost<00:19:03.326> forgotten<00:19:03.920> about.

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It's<00:19:05.011> a<00:19:05.267> big,<00:19:05.572> big<00:19:06.166> successful<00:19:06.711> company<00:19:07.112> right<00:19:07.337> here<00:19:07.449> in<00:19:07.593> Utah.

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And<00:19:09.117> those<00:19:09.422> were<00:19:09.502> all<00:19:09.663> the<00:19:09.759> opportunities<00:19:10.385> available<00:19:10.882> if<00:19:11.043> you<00:19:11.123> were<00:19:11.267> an<00:19:11.347> angel<00:19:11.764> or<00:19:11.845> a<00:19:11.925> venture<00:19:12.246> capital<00:19:12.647> investor<00:19:13.128> in<00:19:13.272> the<00:19:13.433> early<00:19:13.689> 2000s.

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You<00:19:15.542> know,<00:19:15.607> so<00:19:15.998> many<00:19:16.307> of<00:19:16.404> these<00:19:16.648> businesses<00:19:17.299> that<00:19:17.608> went<00:19:17.770> on<00:19:17.949> to<00:19:18.031> be<00:19:18.502> really<00:19:18.828> interesting<00:19:19.429> started<00:19:19.836> in<00:19:19.982> that<00:19:20.161> timeframe.

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So<00:19:22.722> what,<00:19:23.064> where<00:19:23.162> did<00:19:23.309> you<00:19:23.406> go<00:19:23.618> after<00:19:23.863> you<00:19:23.944> left<00:19:24.205> vSpring?

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What<00:19:24.857> did<00:19:25.020> you<00:19:25.102> do<00:19:25.199> next?

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Yeah,<00:19:27.194> so<00:19:27.501> I<00:19:27.598> had<00:19:27.824> a<00:19:28.649> good<00:19:28.811> friend<00:19:29.037> of<00:19:29.070> mine<00:19:29.280> from<00:19:29.458> college,<00:19:29.927> his<00:19:30.089> name<00:19:30.283> is<00:19:30.833> Morgan<00:19:31.302> Lynch,<00:19:32.515> and<00:19:33.081> he<00:19:33.243> had<00:19:33.404> this<00:19:33.582> idea<00:19:33.841> to<00:19:33.970> do<00:19:34.148> a<00:19:34.165> marketplace.

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It<00:19:35.022> has<00:19:35.183> really<00:19:35.361> interesting<00:19:35.830> history.

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So<00:19:36.300> for<00:19:36.493> purposes<00:19:36.896> of<00:19:36.976> Silicon<00:19:37.379> Slopes,<00:19:37.799> I'll<00:19:38.024> tell<00:19:38.185> the<00:19:38.330> whole<00:19:38.524> story,<00:19:38.991> which<00:19:39.217> most<00:19:39.394> people<00:19:39.636> don't<00:19:39.942> know,<00:19:40.764> but<00:19:40.926> there<00:19:41.006> was<00:19:41.167> a<00:19:41.248> little<00:19:41.570> company<00:19:41.812> called<00:19:42.135> Gravity<00:19:42.618> Media<00:19:43.021> and<00:19:43.263> they<00:19:43.408> were<00:19:43.521> sort<00:19:43.795> of<00:19:43.827> a<00:19:43.843> regular<00:19:43.988> agency<00:19:44.182> doing<00:19:44.311> websites<00:19:46.632> creative<00:19:47.097> assets<00:19:47.578> for<00:19:47.835> startups<00:19:48.942> here<00:19:49.118> in<00:19:49.263> Utah.

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But<00:19:50.145> what<00:19:50.241> was<00:19:50.385> interesting<00:19:50.738> about<00:19:51.043> them<00:19:51.283> is<00:19:51.428> they<00:19:51.508> were<00:19:51.668> one<00:19:51.781> of<00:19:51.845> the<00:19:51.925> first<00:19:52.198> sort<00:19:52.390> of<00:19:52.550> work-from-home<00:19:53.272> companies.

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Many<00:19:54.074> of<00:19:54.154> their<00:19:54.251> designers<00:19:54.812> worked<00:19:55.036> from<00:19:55.277> home,<00:19:55.854> and<00:19:55.999> they<00:19:56.095> had<00:19:56.255> built<00:19:56.496> their<00:19:56.656> own<00:19:56.881> little<00:19:57.057> software<00:19:57.923> tool<00:19:58.260> to<00:19:58.405> collaborate<00:19:58.902> on<00:19:59.126> projects<00:19:59.768> where<00:19:59.880> they<00:20:00.025> could<00:20:00.169> do<00:20:00.345> revisions<00:20:01.067> and<00:20:01.532> pass<00:20:01.853> creative<00:20:02.270> back<00:20:02.511> and<00:20:02.607> forth.

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And<00:20:03.938> at<00:20:04.034> the<00:20:04.130> time,<00:20:04.836> my<00:20:05.061> partner<00:20:05.398> Morgan,<00:20:06.520> he<00:20:06.761> was<00:20:07.146> the<00:20:07.242> director<00:20:07.659> of<00:20:07.803> marketing<00:20:08.429> for<00:20:08.669> another<00:20:09.086> high-profile<00:20:10.113> late<00:20:10.354> '90s<00:20:10.835> company<00:20:11.797> in<00:20:12.118> Utah<00:20:12.374> County.

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In<00:20:12.775> fact,<00:20:13.000> I<00:20:13.080> think<00:20:13.240> it<00:20:13.321> was<00:20:13.481> one<00:20:13.577> of<00:20:13.658> the<00:20:13.818> biggest.

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It<00:20:14.203> was<00:20:14.299> called<00:20:14.475> Insurquote.

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And<00:20:15.807> they<00:20:15.903> had<00:20:16.048> raised<00:20:16.321> over<00:20:16.513> $100<00:20:16.947> million.

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Mary<00:20:18.231> Meeker<00:20:18.552> was<00:20:18.713> like,<00:20:18.937> this<00:20:19.114> is<00:20:19.275> the<00:20:19.355> next<00:20:19.676> thing.

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It<00:20:20.783> was<00:20:20.960> like<00:20:21.843> property<00:20:22.244> and<00:20:22.405> casualty<00:20:22.983> insurance<00:20:23.593> online.

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Um,<00:20:25.358> and<00:20:25.455> it<00:20:25.599> ultimately<00:20:26.017> merged<00:20:26.498> with<00:20:26.755> another<00:20:27.863> life<00:20:28.103> insurance<00:20:28.505> company,<00:20:28.729> I<00:20:28.826> think<00:20:29.227> out<00:20:29.452> of<00:20:30.190> Colorado<00:20:31.298> when<00:20:31.410> sort<00:20:31.619> of<00:20:31.715> the<00:20:31.860> dot-com<00:20:33.160> bubble<00:20:33.626> burst<00:20:34.059> in<00:20:34.187> the<00:20:34.380> early<00:20:34.685> 2000s.

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But<00:20:36.371> when<00:20:36.772> Mary<00:20:37.093> Meeker<00:20:37.478> executed<00:20:38.056> this<00:20:38.377> merger<00:20:38.762> of<00:20:38.923> the<00:20:39.003> two<00:20:39.180> businesses,<00:20:40.544> it<00:20:40.576> was<00:20:40.705> a<00:20:40.769> very<00:20:41.090> high-profile<00:20:41.732> thing<00:20:41.989> for<00:20:42.230> Utah.

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His<00:20:43.674> job<00:20:43.995> was<00:20:44.155> to<00:20:44.300> create<00:20:44.620> the<00:20:44.653> new<00:20:44.957> corporate<00:20:45.278> identity.

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So<00:20:46.465> he<00:20:46.562> goes<00:20:46.818> to<00:20:46.882> this<00:20:47.123> local<00:20:47.508> firm.

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In<00:20:47.845> fact,<00:20:48.070> he<00:20:48.150> went<00:20:48.310> to<00:20:48.390> several<00:20:48.807> of<00:20:48.872> the<00:20:48.968> local<00:20:49.289> firms,<00:20:49.770> I<00:20:49.850> think<00:20:50.027> Studio<00:20:50.829> and<00:20:50.973> Gravity<00:20:51.455> Media,<00:20:52.337> said,<00:20:52.577> we<00:20:52.674> need<00:20:52.882> a<00:20:52.979> new<00:20:53.219> logo<00:20:53.700> and<00:20:53.861> corporate<00:20:54.166> identity<00:20:54.647> for<00:20:54.823> this<00:20:54.984> combined<00:20:55.545> software<00:20:56.027> company.

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And<00:20:57.374> he<00:20:57.470> writes<00:20:57.727> a<00:20:57.791> check<00:20:58.032> for<00:20:58.176> like<00:20:58.353> $30,000<00:20:59.716> to<00:20:59.941> execute<00:21:00.438> this.

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And<00:21:01.305> he<00:21:01.401> walks<00:21:01.738> into<00:21:01.882> these<00:21:02.588> fancy<00:21:02.925> conference<00:21:03.486> rooms<00:21:04.048> and<00:21:04.192> gets<00:21:04.369> these<00:21:04.593> presentations.

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And<00:21:06.053> they're<00:21:06.133> just<00:21:06.310> not<00:21:06.518> very<00:21:06.775> good.

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They're<00:21:07.240> on<00:21:07.401> blackboards,<00:21:07.962> of<00:21:08.139> course,<00:21:08.379> they're<00:21:08.604> fancy.

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And<00:21:09.326> he'll<00:21:09.438> be<00:21:09.566> like,<00:21:09.743> what<00:21:09.887> about<00:21:10.144> this?

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What<00:21:10.561> about<00:21:10.786> that?

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Could<00:21:11.267> we<00:21:11.411> combine<00:21:11.909> this<00:21:12.133> one<00:21:12.213> with<00:21:12.390> that<00:21:12.631> one?

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They<00:21:13.513> would<00:21:13.674> send<00:21:14.011> it<00:21:14.156> to<00:21:14.236> some<00:21:14.477> graphic<00:21:14.878> designer<00:21:15.360> in<00:21:15.520> the<00:21:15.665> back<00:21:16.002> room.

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And<00:21:16.307> finally,<00:21:16.628> Morgan<00:21:16.982> is<00:21:17.062> such<00:21:17.351> like<00:21:17.527> a<00:21:18.250> make<00:21:18.427> stuff<00:21:18.796> happen,<00:21:19.438> execution-oriented<00:21:20.562> guy.

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He's<00:21:21.445> like,<00:21:21.943> let<00:21:22.039> me<00:21:22.168> just<00:21:22.344> go<00:21:22.505> back<00:21:22.730> and<00:21:22.810> sit<00:21:23.067> with<00:21:23.228> your<00:21:23.372> designer.

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So<00:21:24.512> he<00:21:24.592> somehow<00:21:24.914> like<00:21:25.219> makes<00:21:25.475> his<00:21:25.636> way<00:21:25.797> back,<00:21:26.118> gets<00:21:26.343> to<00:21:26.423> the<00:21:26.503> designer's<00:21:26.985> desk<00:21:27.338> and<00:21:27.483> sort<00:21:27.659> of<00:21:27.804> like<00:21:28.125> pointing<00:21:28.751> things<00:21:29.008> on<00:21:29.088> the<00:21:29.185> screen.

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Show<00:21:30.148> me<00:21:30.309> that.

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What<00:21:30.774> about<00:21:31.015> this<00:21:31.240> color?

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Anyways,<00:21:32.059> eventually<00:21:32.460> arrives<00:21:32.878> at<00:21:33.664> a<00:21:33.745> graphic<00:21:34.467> and<00:21:34.628> just<00:21:34.933> realizes<00:21:35.671> that<00:21:35.977> the<00:21:36.009> amount<00:21:36.410> of<00:21:36.635> money,<00:21:37.100> the<00:21:37.261> back<00:21:37.518> and<00:21:37.662> forth,<00:21:39.525> was<00:21:39.702> so<00:21:39.991> inefficient.

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And<00:21:41.452> most<00:21:41.757> entrepreneurs,<00:21:42.479> one<00:21:42.640> common<00:21:42.897> denominator<00:21:43.539> is<00:21:43.699> they<00:21:43.860> despise<00:21:44.582> inefficiency.

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When<00:21:46.766> a<00:21:46.975> process<00:21:47.473> is<00:21:47.633> slow,<00:21:48.275> bureaucratic,<00:21:49.158> or<00:21:49.303> broken,<00:21:49.881> it's<00:21:50.025> just<00:21:50.186> fuel<00:21:50.828> that<00:21:51.069> I've<00:21:51.246> got<00:21:51.358> to<00:21:51.470> fix<00:21:51.792> that.

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So<00:21:53.237> of<00:21:53.333> course,<00:21:53.654> he<00:21:53.879> looks<00:21:54.120> at<00:21:54.216> their<00:21:54.441> sort<00:21:54.698> of<00:21:54.794> system<00:21:55.195> of<00:21:55.324> how<00:21:55.420> they're<00:21:55.661> passing<00:21:56.127> graphics<00:21:56.640> around.

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And<00:21:58.150> he's<00:21:58.390> like,<00:21:59.980> you<00:22:00.012> know,<00:22:00.076> I<00:22:00.221> wonder<00:22:00.381> if<00:22:00.783> we<00:22:00.943> could<00:22:01.184> do<00:22:01.361> that.

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And<00:22:02.324> that<00:22:02.485> sort<00:22:02.645> of<00:22:02.886> leads<00:22:03.271> to<00:22:03.368> this<00:22:03.592> conversation<00:22:04.636> of<00:22:05.118> could<00:22:05.294> we<00:22:05.455> build<00:22:05.696> a<00:22:05.776> marketplace?

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At<00:22:06.739> the<00:22:06.884> time,<00:22:07.526> eBay<00:22:07.687> was<00:22:07.783> kind<00:22:07.960> of<00:22:08.088> this<00:22:08.329> new<00:22:08.682> up-and-coming<00:22:09.389> business.

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It<00:22:10.741> was<00:22:12.051> really<00:22:12.439> taking<00:22:12.779> America<00:22:13.264> by<00:22:13.426> storm,<00:22:13.895> both<00:22:14.057> small<00:22:14.396> businesses.

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And<00:22:15.043> it<00:22:15.124> was<00:22:15.221> sort<00:22:15.431> of<00:22:15.593> like<00:22:17.049> what<00:22:17.210> Shopify<00:22:17.954> is<00:22:18.116> today<00:22:18.763> was<00:22:18.925> like<00:22:19.491> eBay<00:22:19.652> back<00:22:19.975> then.

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It<00:22:20.782> was<00:22:20.944> a<00:22:21.105> platform,<00:22:21.831> people<00:22:22.315> were<00:22:22.412> developing<00:22:23.026> on<00:22:23.219> it.

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So<00:22:24.494> we<00:22:24.575> thought,<00:22:24.882> could<00:22:25.059> we<00:22:25.301> do<00:22:27.319> a<00:22:27.399> marketplace<00:22:28.287> for<00:22:28.448> graphic<00:22:28.820> designers<00:22:30.130> where<00:22:30.550> a<00:22:30.615> company<00:22:30.955> that<00:22:31.100> needs<00:22:31.343> design<00:22:31.844> could<00:22:32.071> come<00:22:32.394> in<00:22:33.365> and<00:22:33.721> sort<00:22:33.963> of<00:22:34.028> fill<00:22:34.335> out<00:22:34.449> a<00:22:34.497> short<00:22:35.144> creative<00:22:35.629> brief,<00:22:36.050> and<00:22:36.195> then<00:22:36.357> we<00:22:36.454> could<00:22:36.632> farm<00:22:37.101> this<00:22:37.409> out<00:22:37.587> to<00:22:37.748> remote<00:22:38.040> graphic<00:22:38.425> designers<00:22:39.247> and<00:22:39.398> use<00:22:39.582> a<00:22:39.649> software<00:22:40.069> platform<00:22:40.992> to<00:22:41.073> pass<00:22:41.394> back<00:22:41.651> and<00:22:41.779> forth<00:22:42.116> the<00:22:42.197> file<00:22:42.518> types<00:22:42.919> and<00:22:43.000> the<00:22:43.080> revisions.

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And,<00:22:45.071> and<00:22:45.585> so<00:22:46.130> we<00:22:46.291> started<00:22:46.612> recruiting<00:22:47.094> designers<00:22:47.576> from<00:22:47.816> Craigslist<00:22:49.647> and<00:22:51.172> we<00:22:52.489> started<00:22:53.035> buying<00:22:53.356> keywords<00:22:54.239> on<00:22:54.400> Google<00:22:54.865> AdWords,<00:22:55.363> which<00:22:55.588> was<00:22:55.700> a<00:22:55.829> relatively<00:22:56.423> new<00:22:56.712> platform.

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And<00:22:57.675> you<00:22:57.771> could<00:22:57.932> buy<00:22:58.028> most<00:22:58.333> keywords<00:22:58.879> for<00:22:58.976> like<00:22:59.297> 10<00:22:59.554> cents.

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It<00:23:00.100> was<00:23:00.244> a<00:23:00.340> different<00:23:00.822> day<00:23:01.127> and<00:23:01.207> time.

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You<00:23:02.251> could<00:23:02.347> buy<00:23:02.588> words<00:23:02.893> like<00:23:03.230> logo<00:23:03.616> design<00:23:04.114> for<00:23:04.435> under<00:23:04.740> a<00:23:04.852> dollar.

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So<00:23:06.506> we<00:23:06.667> quickly<00:23:07.004> had<00:23:07.245> an<00:23:07.325> extraordinary—<00:23:08.208> we<00:23:08.369> were<00:23:08.529> charging<00:23:08.995> like<00:23:09.268> $400<00:23:10.454> to<00:23:10.598> get<00:23:10.710> a<00:23:10.774> logo.

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Most<00:23:11.977> businesses<00:23:12.522> were<00:23:12.682> coming<00:23:13.083> in<00:23:13.259> and<00:23:13.355> saying,<00:23:13.980> wow,<00:23:14.301> that<00:23:14.461> would've<00:23:14.685> cost<00:23:14.942> me<00:23:15.166> $2,000<00:23:16.064> at<00:23:16.144> the<00:23:16.288> local<00:23:16.545> design<00:23:17.026> firm.

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And<00:23:18.068> we<00:23:18.148> were<00:23:18.244> sort<00:23:18.484> of<00:23:18.629> pulling<00:23:19.045> levers<00:23:19.430> in<00:23:19.574> the<00:23:19.671> background<00:23:20.376> where<00:23:20.536> we<00:23:20.777> were<00:23:20.953> building<00:23:21.274> the<00:23:21.418> code<00:23:21.738> to<00:23:21.819> eventually<00:23:22.380> automate<00:23:22.780> the<00:23:22.860> whole<00:23:22.973> system<00:23:24.079> and<00:23:24.223> the<00:23:24.303> business.

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Of<00:23:24.720> course,<00:23:25.121> it<00:23:25.281> took<00:23:25.585> off.

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We<00:23:26.146> had<00:23:26.563> a<00:23:26.643> good<00:23:26.868> customer<00:23:27.269> acquisition<00:23:27.765> engine<00:23:28.952> and<00:23:29.128> Morgan<00:23:29.673> would<00:23:29.913> come<00:23:30.154> in<00:23:30.795> every<00:23:31.132> month<00:23:31.468> or<00:23:31.548> so,<00:23:32.254> and<00:23:32.959> we<00:23:33.199> would<00:23:33.376> write<00:23:33.600> the<00:23:33.680> business<00:23:34.097> plan<00:23:34.642> and<00:23:34.738> sort<00:23:34.963> of<00:23:35.123> think<00:23:35.299> through<00:23:35.460> the<00:23:35.540> milestones.

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And<00:23:37.384> finally,<00:23:37.689> he's<00:23:37.849> like,<00:23:38.090> hey,<00:23:38.186> are<00:23:38.411> you<00:23:38.507> ever<00:23:38.731> going<00:23:38.828> to<00:23:38.972> quit?

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Are<00:23:39.710> we<00:23:39.742> going<00:23:39.871> to<00:23:39.951> do<00:23:40.095> this<00:23:40.272> full-time?

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I<00:23:41.314> feel<00:23:41.459> like<00:23:41.571> I'm<00:23:41.780> kind<00:23:41.940> of<00:23:41.972> like<00:23:42.742> trying<00:23:42.919> to<00:23:42.999> make<00:23:43.240> this<00:23:43.400> business<00:23:43.865> go<00:23:44.202> and<00:23:44.443> be<00:23:44.668> awesome<00:23:44.940> if<00:23:45.069> you<00:23:45.229> join.

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And,<00:23:46.673> um,<00:23:47.251> and<00:23:47.395> so<00:23:47.636> I<00:23:47.716> was<00:23:47.956> arrogant<00:23:48.293> enough<00:23:48.678> that<00:23:48.775> I<00:23:48.855> went<00:23:49.079> to<00:23:49.160> the<00:23:49.256> partnership<00:23:49.834> at<00:23:49.978> VSpring<00:23:50.539> and<00:23:50.604> I<00:23:50.684> was<00:23:50.780> like,<00:23:50.957> I<00:23:51.101> can't<00:23:51.342> work<00:23:51.582> this<00:23:51.807> hard<00:23:52.144> if<00:23:52.288> you're<00:23:52.384> not<00:23:52.497> going<00:23:52.625> to<00:23:52.705> give<00:23:52.946> me<00:23:53.042> more<00:23:53.267> of<00:23:53.411> the<00:23:53.507> carry<00:23:53.893> economics.

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And<00:23:55.256> I<00:23:55.304> think<00:23:55.433> the<00:23:55.577> partners,<00:23:56.074> they<00:23:56.139> already<00:23:56.459> had<00:23:56.636> 5<00:23:57.358> partners<00:23:57.919> that<00:23:58.064> all<00:23:58.240> wanted<00:23:59.187> to<00:23:59.267> make<00:23:59.524> more<00:23:59.700> money.

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And<00:24:01.032> I<00:24:01.128> feel<00:24:01.353> like<00:24:01.593> that<00:24:02.251> we<00:24:02.331> just<00:24:02.572> sort<00:24:02.716> of<00:24:02.813> the<00:24:02.957> wrong<00:24:03.278> ass<00:24:03.535> to<00:24:03.695> the<00:24:03.839> wrong<00:24:04.160> group<00:24:04.433> at<00:24:04.561> the<00:24:04.642> wrong<00:24:04.898> time.

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I<00:24:05.299> think<00:24:05.444> they<00:24:05.540> probably<00:24:06.422> They<00:24:06.502> were<00:24:06.663> very<00:24:06.967> courteous<00:24:07.464> at<00:24:07.528> the<00:24:07.624> time,<00:24:07.865> but<00:24:08.009> they<00:24:08.105> probably<00:24:08.426> laughed<00:24:08.827> me<00:24:08.971> out<00:24:09.083> of<00:24:09.131> the<00:24:09.308> room.

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Like,<00:24:09.772> can<00:24:09.933> you<00:24:10.029> believe<00:24:10.350> this<00:24:10.590> arrogant<00:24:10.991> kid's<00:24:11.375> asking<00:24:11.616> for<00:24:11.792> 10%<00:24:12.097> of<00:24:12.337> our<00:24:12.433> partnership?

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And<00:24:14.453> so<00:24:14.678> once<00:24:14.902> they<00:24:14.998> said<00:24:15.319> no,<00:24:16.585> I<00:24:16.697> knew<00:24:17.162> like<00:24:17.323> if<00:24:17.419> I<00:24:17.451> was<00:24:17.563> gonna<00:24:17.723> keep<00:24:17.948> working<00:24:18.268> this<00:24:18.429> hard,<00:24:19.070> I<00:24:19.246> gotta<00:24:19.407> go<00:24:19.551> do<00:24:19.727> it<00:24:19.807> for<00:24:19.920> myself.

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So<00:24:20.593> I<00:24:20.689> joined<00:24:21.010> Morgan<00:24:21.474> full-time<00:24:23.077> and,<00:24:23.398> uh,<00:24:23.655> I<00:24:23.735> think<00:24:23.975> the<00:24:24.039> next<00:24:24.296> month<00:24:24.520> we<00:24:24.681> did<00:24:24.761> like<00:24:25.017> $10,000<00:24:26.684> of<00:24:26.796> revenue<00:24:27.261> and<00:24:27.406> we<00:24:27.502> were<00:24:27.598> so<00:24:27.903> thrilled,<00:24:28.464> like<00:24:28.864> it's<00:24:29.105> working.

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So<00:24:30.291> we<00:24:30.387> just<00:24:30.532> started<00:24:31.044> scaling<00:24:31.509> the<00:24:31.589> platform<00:24:32.471> and<00:24:32.792> figuring<00:24:33.176> out<00:24:33.257> how<00:24:33.353> to<00:24:33.433> get<00:24:33.593> more<00:24:33.754> customers<00:24:34.234> from<00:24:34.379> more<00:24:34.619> channels<00:24:35.276> and<00:24:35.918> making<00:24:36.238> the<00:24:36.318> platform<00:24:36.863> more<00:24:37.024> automated.

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The<00:24:37.665> business<00:24:38.082> called<00:24:38.306> Logo<00:24:38.627> Works.

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Um,<00:24:40.633> and<00:24:41.917> we<00:24:41.997> get<00:24:42.109> about<00:24:42.334> a<00:24:42.495> year<00:24:42.719> into<00:24:43.040> it,<00:24:43.602> we<00:24:43.682> have<00:24:44.003> really<00:24:44.260> great<00:24:44.564> growth,<00:24:45.543> we're<00:24:45.768> like,<00:24:46.009> we<00:24:46.105> should<00:24:46.330> try<00:24:46.490> and<00:24:46.650> raise<00:24:46.987> some<00:24:47.132> money.

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And<00:24:48.817> I<00:24:48.977> think<00:24:49.234> I<00:24:49.394> was<00:24:49.507> just<00:24:49.715> a<00:24:49.795> little<00:24:50.100> bit<00:24:50.293> jaded<00:24:50.903> with<00:24:51.063> the<00:24:51.159> dysfunction<00:24:51.785> that<00:24:51.881> I<00:24:51.962> knew<00:24:52.267> existed<00:24:52.684> inside<00:24:53.069> of<00:24:53.165> vSpring,<00:24:53.903> even<00:24:54.064> though<00:24:54.208> I<00:24:54.353> really<00:24:55.075> adored<00:24:55.572> some<00:24:55.749> of<00:24:55.957> the<00:24:56.053> individual<00:24:56.615> partners.

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And,<00:24:58.444> um,<00:24:59.584> I'm<00:24:59.969> not<00:25:00.145> really<00:25:00.370> sure<00:25:00.627> why.

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I<00:25:01.349> think<00:25:01.589> I<00:25:01.670> thought<00:25:01.926> if<00:25:02.071> I<00:25:02.215> went<00:25:02.311> to<00:25:02.472> the<00:25:02.632> Bay<00:25:02.793> Area,<00:25:03.756> getting<00:25:04.141> Bay<00:25:04.381> Area<00:25:04.718> money<00:25:05.184> would<00:25:05.280> sort<00:25:05.585> of<00:25:06.162> be<00:25:06.322> this<00:25:06.627> validation<00:25:07.429> on<00:25:07.541> our<00:25:07.749> opportunity<00:25:09.048> that<00:25:09.128> would<00:25:09.288> be<00:25:09.448> different<00:25:09.865> in<00:25:09.993> a<00:25:10.090> way<00:25:10.490> than<00:25:10.891> Utah<00:25:11.212> money.

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I<00:25:12.013> would<00:25:12.238> think<00:25:12.414> about<00:25:12.654> that<00:25:12.895> differently<00:25:13.296> today,<00:25:14.161> but<00:25:14.257> back<00:25:14.498> then—.

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Oh,<00:25:15.684> back<00:25:15.844> then<00:25:16.181> for<00:25:16.325> sure.

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Yeah.

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So<00:25:18.345> we<00:25:18.441> set<00:25:18.682> up<00:25:18.810> these<00:25:18.970> fundraising<00:25:19.467> appointments.

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We<00:25:20.541> didn't<00:25:20.830> really<00:25:20.990> know<00:25:21.166> many<00:25:21.391> people,<00:25:21.776> but<00:25:21.872> luckily<00:25:22.208> Mike<00:25:22.657> Leventhal,<00:25:23.395> he<00:25:23.507> had<00:25:23.635> just<00:25:23.956> moved<00:25:24.116> to<00:25:24.340> Utah<00:25:24.741> and<00:25:24.837> he'd<00:25:25.062> reached<00:25:25.382> out<00:25:25.639> and<00:25:25.703> said,<00:25:26.440> hey,<00:25:26.617> I'm<00:25:26.777> a<00:25:26.841> venture<00:25:27.162> investor.

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I<00:25:27.787> want<00:25:27.867> to<00:25:27.947> do<00:25:27.979> some<00:25:28.204> angel<00:25:28.524> investments.

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He'd<00:25:29.791> introduced<00:25:30.191> us<00:25:30.368> to<00:25:30.512> his<00:25:30.752> wife<00:25:31.073> who<00:25:31.153> has<00:25:31.265> a<00:25:31.329> background<00:25:31.810> in<00:25:31.891> consumer<00:25:32.371> companies.

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She<00:25:33.157> worked<00:25:33.333> at<00:25:33.478> Apple<00:25:34.696> and<00:25:34.840> other<00:25:35.000> consumer<00:25:35.337> companies<00:25:35.722> back<00:25:35.898> in<00:25:35.978> the<00:25:36.058> day.

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And<00:25:36.700> Kathy<00:25:37.181> Schlein,<00:25:37.726> and<00:25:37.982> introduced<00:25:38.544> us<00:25:38.769> to<00:25:39.010> all<00:25:39.187> the<00:25:39.267> Silicon<00:25:39.668> Valley<00:25:40.054> VCs.

00:25:40.551 --> 00:25:44.421
It<00:25:40.616> was<00:25:40.728> a<00:25:40.937> really<00:25:41.338> generous<00:25:43.281> group<00:25:43.457> of<00:25:43.602> introductions<00:25:44.084> she<00:25:44.308> made.

00:25:44.485 --> 00:25:48.595
She<00:25:44.581> even<00:25:44.806> flew<00:25:45.047> with<00:25:45.272> us<00:25:45.448> to,<00:25:45.689> to<00:25:45.834> Sand<00:25:46.074> Hill<00:25:46.251> Road<00:25:46.893> and<00:25:46.974> she<00:25:47.134> walks<00:25:47.455> us<00:25:47.600> into<00:25:47.776> John<00:25:48.097> Doerr.

00:25:48.884 --> 00:25:51.582
Obviously<00:25:49.205> her<00:25:49.382> brother<00:25:49.783> Ted<00:25:50.008> Schlein<00:25:50.426> worked<00:25:50.650> at<00:25:50.731> Kleiner<00:25:51.052> forever.

00:25:52.031 --> 00:25:56.462
She<00:25:52.192> walks<00:25:52.449> us<00:25:52.657> into<00:25:52.834> Bob<00:25:53.139> Kegel<00:25:53.492> at<00:25:53.637> Benchmark,<00:25:55.242> Jim<00:25:55.483> Schwartz<00:25:55.981> at<00:25:56.109> Accel.

00:25:56.527 --> 00:26:00.107
Like<00:25:56.751> one<00:25:56.928> by<00:25:57.233> one,<00:25:57.634> we're<00:25:57.811> meeting<00:25:58.132> with<00:25:58.373> the<00:25:58.453> top<00:25:58.774> guys<00:25:59.112> at<00:25:59.240> the<00:25:59.320> top<00:25:59.641> funds.

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And<00:26:01.102> I<00:26:01.263> think<00:26:01.488> our<00:26:01.584> first<00:26:01.921> or<00:26:01.986> second<00:26:02.467> meeting<00:26:02.788> was<00:26:03.029> Benchmark.

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And<00:26:04.297> we<00:26:04.394> get<00:26:04.554> about<00:26:04.971> 5<00:26:05.597> slides<00:26:06.159> into<00:26:06.480> like<00:26:06.656> a<00:26:06.721> 15-slide<00:26:07.748> deck.

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And<00:26:09.449> on<00:26:09.593> the<00:26:09.770> left-hand<00:26:10.492> side<00:26:11.038> of<00:26:11.359> every<00:26:11.760> one<00:26:11.872> of<00:26:12.001> our<00:26:12.097> master<00:26:12.579> slides,<00:26:13.301> we<00:26:13.381> would<00:26:13.542> show<00:26:13.863> 4<00:26:14.280> logos<00:26:14.906> that<00:26:15.002> had<00:26:15.146> been<00:26:15.371> produced<00:26:15.788> in<00:26:15.869> the<00:26:15.949> marketplace.

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And<00:26:17.955> they<00:26:18.099> were<00:26:18.180> always<00:26:18.517> different.

00:26:18.934 --> 00:26:22.898
So<00:26:19.062> it<00:26:19.159> wasn't<00:26:19.383> like<00:26:19.496> a<00:26:19.560> master<00:26:19.961> slide,<00:26:20.298> it<00:26:20.362> was<00:26:20.443> just<00:26:20.603> like<00:26:20.780> a<00:26:20.908> different<00:26:21.229> background<00:26:21.727> for<00:26:22.031> every<00:26:22.369> slide.

00:26:23.669 --> 00:26:27.552
So<00:26:23.877> we're,<00:26:24.359> let's<00:26:24.535> call<00:26:24.696> it<00:26:24.776> 5<00:26:25.017> slides<00:26:25.418> in<00:26:25.675> and<00:26:26.140> Bob<00:26:26.381> seen<00:26:26.686> 20<00:26:27.023> logos.

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And<00:26:27.809> one<00:26:27.922> of<00:26:27.986> the<00:26:28.130> logos<00:26:28.612> was<00:26:28.708> for<00:26:28.868> a<00:26:29.029> dry<00:26:29.350> cleaners.

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And<00:26:30.634> he<00:26:30.714> just<00:26:30.891> stops<00:26:31.518> and<00:26:31.598> he's<00:26:31.839> like,<00:26:32.900> I'm<00:26:33.061> thinking<00:26:33.446> about<00:26:33.848> how<00:26:34.009> many<00:26:34.395> dry<00:26:34.652> cleaners<00:26:35.134> are<00:26:35.278> out<00:26:35.455> there,<00:26:35.841> let<00:26:35.937> alone<00:26:36.243> how<00:26:36.275> many<00:26:36.500> small<00:26:36.885> businesses.

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I<00:26:37.464> can't<00:26:37.689> believe<00:26:37.962> how<00:26:38.042> many<00:26:38.332> logos<00:26:38.669> you<00:26:38.750> guys<00:26:38.894> have<00:26:39.055> already<00:26:39.232> produced.

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This<00:26:39.657> is<00:26:39.804> crazy.

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He's<00:26:40.851> like,<00:26:41.047> I'm<00:26:41.276> in,<00:26:42.175> let's<00:26:42.338> do<00:26:42.502> this.

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And<00:26:44.885> we<00:26:44.966> started<00:26:45.291> negotiating<00:26:45.843> a<00:26:45.860> deal<00:26:46.022> with<00:26:46.250> Benchmark.

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They<00:26:47.403> bought<00:26:47.712> 20%<00:26:48.134> of<00:26:48.297> the<00:26:48.443> equity<00:26:48.931> for<00:26:49.435> $4.5<00:26:49.922> or<00:26:49.987> $5<00:26:50.166> million.

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And<00:26:52.112> we<00:26:52.210> were<00:26:52.340> kind<00:26:52.454> of<00:26:52.667> off<00:26:52.764> to<00:26:52.911> the<00:26:52.993> races.

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The<00:26:53.499> growth<00:26:53.744> just<00:26:53.988> accelerated<00:26:54.559> even<00:26:54.804> more.

00:26:56.303 --> 00:27:06.862
But<00:26:56.399> it<00:26:56.464> was<00:26:56.544> this<00:26:56.704> great<00:26:56.881> experience<00:26:57.346> because<00:26:57.571> we<00:26:57.731> got<00:26:57.924> to<00:26:58.309> early<00:26:58.614> on,<00:26:58.774> this<00:26:58.951> was<00:26:59.111> 2004<00:27:00.058> or<00:27:00.106> '05,<00:27:01.518> got<00:27:01.727> to<00:27:01.759> get<00:27:01.984> pitched<00:27:02.320> by<00:27:02.481> all<00:27:02.722> the<00:27:02.882> great<00:27:03.187> venture<00:27:03.508> funds<00:27:03.861> on<00:27:03.989> why<00:27:04.166> we<00:27:04.262> should<00:27:04.471> take<00:27:04.711> their<00:27:04.888> money<00:27:05.369> and<00:27:05.674> build<00:27:05.851> relationships<00:27:06.573> early.

00:27:07.279 --> 00:27:10.584
And<00:27:07.375> a<00:27:07.439> lot<00:27:07.616> of<00:27:07.680> those<00:27:07.856> relationships<00:27:09.204> have<00:27:09.381> continued<00:27:09.926> even<00:27:10.103> today.

00:27:10.905 --> 00:27:19.073
A<00:27:11.050> good<00:27:11.146> example<00:27:11.627> of<00:27:11.772> that<00:27:12.028> would<00:27:12.269> be<00:27:12.574> one<00:27:12.750> of<00:27:12.831> the<00:27:13.232> introductions<00:27:13.954> that<00:27:14.275> Bob<00:27:14.499> Kagel<00:27:14.836> had<00:27:15.061> made<00:27:15.960> was<00:27:16.184> Jeff<00:27:16.425> Jordan,<00:27:17.324> because<00:27:17.564> Jeff<00:27:17.885> was<00:27:18.046> the<00:27:18.126> president<00:27:18.527> of<00:27:18.992> eBay.

00:27:19.169 --> 00:27:20.533
Bob<00:27:19.410> was<00:27:19.570> on<00:27:19.650> the<00:27:19.811> board<00:27:20.035> of<00:27:20.356> eBay.

00:27:21.399 --> 00:27:27.395
And<00:27:21.913> so<00:27:22.137> he<00:27:22.218> was<00:27:22.378> kind<00:27:22.442> of<00:27:22.474> like,<00:27:22.779> let's<00:27:23.100> learn<00:27:23.966> what<00:27:24.126> we<00:27:24.223> can<00:27:24.543> from<00:27:25.168> eBay<00:27:25.264> and<00:27:25.488> put<00:27:25.649> that<00:27:25.825> into<00:27:26.065> the<00:27:26.209> LogoWorks<00:27:26.786> marketplace.

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And<00:27:28.148> then<00:27:28.309> all<00:27:28.453> those<00:27:28.693> years<00:27:28.934> later,<00:27:29.190> I<00:27:29.254> ended<00:27:29.430> up<00:27:29.575> on<00:27:29.607> a<00:27:29.735> board<00:27:29.975> with<00:27:30.135> Jeff<00:27:30.552> and<00:27:30.696> all<00:27:30.792> those<00:27:30.953> years<00:27:31.193> later,<00:27:32.875> you<00:27:32.972> know,<00:27:33.500> I<00:27:33.597> end<00:27:33.773> up<00:27:33.917> calling<00:27:34.318> Jeff<00:27:34.574> about<00:27:34.862> the<00:27:34.943> Neighbor<00:27:35.343> opportunity,<00:27:36.080> which<00:27:36.224> he<00:27:36.385> then<00:27:36.497> invested<00:27:37.042> in.

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And<00:27:38.147> then<00:27:38.724> it<00:27:38.868> was<00:27:39.029> very<00:27:39.141> natural<00:27:39.670> when<00:27:39.766> you<00:27:39.926> called<00:27:40.230> me<00:27:40.311> and<00:27:40.407> said,<00:27:40.727> hey,<00:27:41.112> who<00:27:41.272> could<00:27:41.368> moderate<00:27:41.849> this<00:27:42.009> session?

00:27:42.410 --> 00:27:44.733
I'm<00:27:42.554> like,<00:27:42.730> well,<00:27:42.874> Jeff<00:27:43.067> Jordan<00:27:43.371> at<00:27:43.467> Andreessen<00:27:43.916> would<00:27:44.092> be<00:27:44.172> great.

00:27:44.974 --> 00:28:01.675
But<00:27:45.134> that<00:27:45.438> was<00:27:45.679> like,<00:27:46.640> you<00:27:46.672> know,<00:27:46.960> a<00:27:47.057> long,<00:27:48.002> long-term<00:27:48.419> relationship<00:27:49.300> that<00:27:49.620> really<00:27:50.887> Um,<00:27:52.188> was<00:27:52.364> a<00:27:52.429> product<00:27:52.990> of<00:27:53.135> those<00:27:53.311> initial<00:27:53.793> introductions<00:27:54.515> that<00:27:54.676> Michael<00:27:54.997> Leventhal<00:27:55.944> and<00:27:56.827> Kathy<00:27:57.164> Schlein<00:27:57.549> had<00:27:57.726> made<00:27:57.967> for<00:27:58.192> us,<00:27:58.448> these<00:27:58.609> two,<00:27:59.235> you<00:27:59.267> know,<00:27:59.492> 20-something<00:28:00.150> startup<00:28:00.616> guys<00:28:00.872> that<00:28:01.017> didn't<00:28:01.258> know<00:28:01.434> much.

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And<00:28:06.780> without<00:28:07.262> them,<00:28:07.823> you<00:28:07.856> know,<00:28:08.080> our<00:28:08.225> business<00:28:08.546> would<00:28:08.626> have<00:28:08.722> never<00:28:08.963> developed.

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And<00:28:10.231> then<00:28:10.472> the,<00:28:10.649> uh,<00:28:11.050> the<00:28:11.130> conclusion<00:28:11.676> of<00:28:11.853> it—<00:28:11.885> I'm<00:28:12.029> skipping<00:28:12.479> a<00:28:12.495> lot,<00:28:12.896> but<00:28:13.057> we<00:28:13.217> grew<00:28:13.378> very<00:28:13.619> rapidly.

00:28:15.128 --> 00:28:17.439
Business<00:28:15.449> was<00:28:15.529> headquartered<00:28:16.027> in<00:28:16.123> Linden<00:28:16.524> at<00:28:16.604> the<00:28:16.733> Canopy<00:28:17.134> Building.

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And<00:28:19.315> I<00:28:19.395> end<00:28:19.571> up<00:28:19.699> getting<00:28:19.892> an<00:28:20.020> outbound<00:28:20.421> call<00:28:20.661> from<00:28:20.837> HP<00:28:21.238> and<00:28:21.334> they're<00:28:21.478> like,<00:28:22.119> "We<00:28:22.264> wanna<00:28:22.520> acquire<00:28:23.145> you<00:28:23.306> because<00:28:23.642> we<00:28:23.786> can<00:28:23.899> see<00:28:24.187> how<00:28:24.267> much<00:28:24.604> ink<00:28:24.828> you're<00:28:24.924> spilling."<00:28:25.806> Like<00:28:26.030> every<00:28:26.287> one<00:28:26.383> of<00:28:26.447> these<00:28:26.671> design<00:28:27.088> projects,<00:28:27.489> we'd<00:28:27.713> expanded<00:28:28.210> into<00:28:28.515> all<00:28:28.611> sorts<00:28:28.915> of<00:28:29.011> other<00:28:29.172> design<00:28:29.508> at<00:28:29.637> this<00:28:29.813> point.

00:28:30.759 --> 00:28:40.840
And<00:28:30.935> most<00:28:31.175> people<00:28:31.480> would<00:28:31.656> print<00:28:31.896> them<00:28:32.057> on<00:28:32.297> Indigo<00:28:33.323> printers,<00:28:33.804> which<00:28:33.964> was<00:28:34.076> an<00:28:34.204> Israeli<00:28:34.782> digital<00:28:35.166> printing<00:28:35.567> company<00:28:36.448> that<00:28:36.545> HP<00:28:36.929> had<00:28:37.106> bought<00:28:38.051> to<00:28:38.628> sort<00:28:38.788> of<00:28:38.933> compete<00:28:39.333> with<00:28:39.494> traditional<00:28:40.055> offset<00:28:40.471> presses.

00:28:41.353 --> 00:29:01.664
So<00:28:41.577> we<00:28:41.738> were<00:28:41.930> early<00:28:42.299> to<00:28:42.395> this<00:28:42.635> digital<00:28:43.036> printing<00:28:43.356> revolution<00:28:44.719> and<00:28:44.799> they<00:28:44.895> had<00:28:45.023> also<00:28:45.360> bought<00:28:46.980> Snapfish,<00:28:48.233> you<00:28:48.266> know,<00:28:48.490> a<00:28:48.506> photo<00:28:48.828> sharing<00:28:49.229> site<00:28:49.840> in<00:28:49.936> the<00:28:50.017> early<00:28:50.402> 2000s<00:28:51.141> for<00:28:51.286> the<00:28:51.318> same<00:28:51.623> idea<00:28:52.105> that<00:28:52.250> people<00:28:52.442> are<00:28:52.507> going<00:28:52.619> to<00:28:52.748> print<00:28:52.989> their<00:28:53.133> photos,<00:28:53.696> this<00:28:53.808> is<00:28:53.953> going<00:28:54.065> to<00:28:54.113> spill<00:28:54.499> lots<00:28:54.692> of<00:28:54.836> ink,<00:28:55.575> and<00:28:55.704> HP<00:28:56.346> Inc.<00:28:56.523> is<00:28:56.603> so<00:28:56.925> profitable,<00:28:57.712> anytime<00:28:58.113> they<00:28:58.210> can<00:28:58.370> buy<00:28:58.467> a<00:28:58.611> business<00:28:59.013> that<00:28:59.109> spills<00:28:59.495> ink,<00:29:00.218> that's<00:29:00.716> a<00:29:00.861> good<00:29:01.085> fit<00:29:01.262> for<00:29:01.423> them.

00:29:02.371 --> 00:29:07.897
But<00:29:02.531> we<00:29:02.628> didn't<00:29:03.174> really<00:29:03.431> think<00:29:03.672> much<00:29:03.977> of<00:29:04.218> the<00:29:04.379> call<00:29:04.716> because<00:29:06.708> we<00:29:06.789> weren't<00:29:06.981> selling<00:29:07.367> the<00:29:07.511> company.

00:29:08.716 --> 00:29:24.220
And<00:29:08.877> then<00:29:09.118> randomly,<00:29:09.632> I'm<00:29:09.793> at<00:29:09.921> the<00:29:10.002> Montgomery<00:29:11.383> Investment<00:29:12.010> Conference<00:29:12.588> in<00:29:12.668> Santa<00:29:12.990> Monica,<00:29:14.659> And<00:29:15.316> this<00:29:15.557> guy<00:29:15.878> comes<00:29:16.183> up<00:29:16.343> and<00:29:16.423> asks<00:29:16.760> me<00:29:16.840> for<00:29:17.081> directions<00:29:17.883> to<00:29:18.028> the<00:29:18.188> registration<00:29:19.006> booth,<00:29:20.049> and<00:29:20.193> his<00:29:20.450> badge<00:29:20.787> is<00:29:21.011> Chris<00:29:21.477> Robell,<00:29:22.391> VP<00:29:22.937> Corp<00:29:23.257> Dev<00:29:23.658> HP.

00:29:25.166 --> 00:29:31.503
And<00:29:25.215> he<00:29:25.824> glances<00:29:27.011> at<00:29:27.172> my<00:29:27.509> badge<00:29:27.845> and<00:29:27.974> he's<00:29:28.150> like,<00:29:29.418> wait,<00:29:29.755> Jeff,<00:29:30.140> didn't<00:29:30.396> my<00:29:30.557> team<00:29:30.861> talk<00:29:31.118> with<00:29:31.343> you?

00:29:31.615 --> 00:29:33.316
How<00:29:31.696> come<00:29:31.904> we<00:29:32.000> never<00:29:32.738> did<00:29:32.947> a<00:29:33.043> deal?

00:29:34.407 --> 00:29:35.867
I<00:29:34.455> was<00:29:34.551> like,<00:29:34.792> you<00:29:34.888> didn't<00:29:35.113> bring<00:29:35.289> your<00:29:35.433> checkbook.

00:29:35.995 --> 00:29:36.605
It<00:29:36.027> was<00:29:36.155> just<00:29:36.348> a<00:29:36.476> call.

00:29:37.760 --> 00:29:39.091
And<00:29:37.808> he's<00:29:37.936> like,<00:29:38.016> well,<00:29:38.161> I<00:29:38.225> have<00:29:38.337> my<00:29:38.482> checkbook<00:29:38.963> now.

00:29:39.284 --> 00:29:39.813
Do<00:29:39.316> you<00:29:39.444> have<00:29:39.556> an<00:29:39.685> hour?

00:29:40.728 --> 00:29:47.633
So<00:29:40.889> we<00:29:40.986> sit<00:29:41.227> down<00:29:41.469> in<00:29:41.533> the<00:29:41.630> hotel<00:29:41.968> lobby,<00:29:42.998> an<00:29:43.143> hour<00:29:43.400> later<00:29:43.722> we<00:29:43.819> sold<00:29:44.125> the<00:29:44.205> business<00:29:44.752> all<00:29:44.849> cash<00:29:45.235> to<00:29:45.316> HP,<00:29:45.879> 3<00:29:46.201> years<00:29:46.539> after<00:29:46.796> I<00:29:46.829> had<00:29:47.086> left<00:29:47.327> V<00:29:47.424> Spring.

00:29:47.730 --> 00:29:53.356
I<00:29:47.746> left<00:29:47.971> V<00:29:48.084> Spring,<00:29:49.070> my<00:29:49.118> last<00:29:49.524> day<00:29:50.385> was<00:29:51.619> June<00:29:52.284> of<00:29:52.430> 2004.

00:29:54.704 --> 00:29:56.295
We<00:29:54.866> probably<00:29:55.191> raised<00:29:55.499> money<00:29:55.759> in<00:29:55.791> '05.

00:29:56.930 --> 00:29:59.155
We<00:29:56.979> sold<00:29:57.358> the<00:29:57.457> business<00:29:57.853> in<00:29:58.182> April<00:29:58.512> of<00:29:58.644> '07.

00:30:00.810 --> 00:30:04.545
So<00:30:00.924> the<00:30:01.072> whole<00:30:01.317> thing<00:30:01.580> beginning<00:30:01.907> to<00:30:02.137> end<00:30:02.399> was<00:30:03.300> less<00:30:03.611> than<00:30:03.775> 3<00:30:04.119> years.

00:30:05.950 --> 00:30:13.336
And,<00:30:06.130> um,<00:30:07.017> Look,<00:30:07.418> I<00:30:07.578> think<00:30:07.899> like<00:30:08.076> most<00:30:08.300> entrepreneurs,<00:30:09.022> we<00:30:09.118> always<00:30:09.759> think<00:30:09.920> about,<00:30:10.305> well,<00:30:10.625> had<00:30:10.786> we<00:30:10.866> not<00:30:11.123> sold,<00:30:11.508> like,<00:30:12.229> what<00:30:12.390> would<00:30:12.486> the<00:30:12.630> outcome<00:30:12.951> have<00:30:13.127> been?

00:30:13.384 --> 00:30:15.052
It<00:30:13.673> inevitably<00:30:14.170> would've<00:30:14.330> been<00:30:14.490> different.

00:30:15.838 --> 00:30:22.156
You<00:30:15.870> know,<00:30:16.014> HP<00:30:16.335> moved<00:30:16.575> the<00:30:16.656> business<00:30:16.912> to<00:30:17.040> San<00:30:17.153> Francisco,<00:30:17.858> merged<00:30:18.179> it<00:30:18.259> into<00:30:18.484> their<00:30:18.644> internet<00:30:19.061> group,<00:30:19.478> and<00:30:20.184> everything<00:30:20.521> about<00:30:20.841> it<00:30:20.970> changed<00:30:21.467> upside<00:30:21.852> down.

00:30:22.204 --> 00:30:24.402
Some<00:30:22.493> things<00:30:22.734> for<00:30:22.846> the<00:30:22.990> better,<00:30:23.311> a<00:30:23.391> lot<00:30:23.616> of<00:30:23.696> things<00:30:23.953> for<00:30:24.177> worse.

00:30:25.300 --> 00:30:31.538
And,<00:30:27.160> you<00:30:27.192> know,<00:30:27.401> but<00:30:27.785> look,<00:30:28.267> having<00:30:28.587> an<00:30:28.828> early<00:30:29.309> outcome<00:30:30.127> makes<00:30:30.367> a<00:30:30.448> big<00:30:30.608> difference<00:30:31.009> personally.

00:30:32.212 --> 00:30:36.146
Because<00:30:32.517> you<00:30:32.549> stop<00:30:32.854> playing<00:30:33.175> defense,<00:30:33.657> you're<00:30:33.753> not<00:30:33.898> worrying<00:30:34.139> about<00:30:34.363> your<00:30:34.540> minivan<00:30:35.086> car<00:30:35.327> payment<00:30:35.600> anymore.

00:30:36.692 --> 00:30:39.807
You<00:30:36.788> are<00:30:37.013> just<00:30:37.430> thinking<00:30:37.832> creatively<00:30:38.394> about<00:30:38.618> the<00:30:38.651> next<00:30:39.020> thing<00:30:39.116> you<00:30:39.341> get<00:30:39.502> to<00:30:39.598> build.

00:30:40.706 --> 00:30:47.594
And<00:30:40.802> so<00:30:40.947> I<00:30:41.043> think<00:30:41.990> just<00:30:42.344> having<00:30:42.713> that<00:30:42.906> financial<00:30:43.371> pressure<00:30:43.837> taken<00:30:44.174> away<00:30:44.431> so<00:30:44.640> that<00:30:44.736> we<00:30:44.881> could<00:30:45.041> then<00:30:45.202> focus<00:30:45.699> on,<00:30:46.486> hey,<00:30:46.647> what<00:30:46.807> was<00:30:46.984> next?

00:30:48.830 --> 00:30:52.732
Was<00:30:49.087> a<00:30:49.376> really<00:30:49.617> great<00:30:49.858> blessing,<00:30:51.239> you<00:30:51.335> know,<00:30:51.544> to<00:30:51.624> happen<00:30:51.962> at<00:30:52.042> a<00:30:52.122> pretty<00:30:52.347> young<00:30:52.588> age.

00:30:53.953 --> 00:30:54.948
Oh,<00:30:54.226> it's<00:30:54.370> unbelievable.

00:30:54.996 --> 00:30:55.751
What<00:30:55.157> was<00:30:55.414> next?

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What<00:30:56.120> happened<00:30:56.377> next?

00:30:58.368 --> 00:31:06.944
Yeah,<00:30:58.625> well,<00:30:59.187> kind<00:30:59.364> of<00:30:59.492> at<00:30:59.573> a<00:30:59.669> parallel<00:31:00.151> process,<00:31:01.099> um,<00:31:01.596> we<00:31:01.677> had<00:31:01.821> an<00:31:01.918> entrepreneur—<00:31:02.721> this<00:31:02.865> will<00:31:02.962> maybe<00:31:03.202> get<00:31:03.363> into<00:31:03.524> the<00:31:03.604> next<00:31:03.925> part<00:31:04.086> of<00:31:04.150> the<00:31:04.182> story—<00:31:05.435> we<00:31:05.515> had<00:31:05.595> an<00:31:05.676> entrepreneur<00:31:06.093> when<00:31:06.238> I<00:31:06.318> was<00:31:06.431> at<00:31:06.575> Vspring.

00:31:07.041 --> 00:31:09.241
He<00:31:07.137> came<00:31:07.474> in,<00:31:07.764> he<00:31:07.844> was<00:31:07.940> wearing<00:31:08.181> shorts<00:31:08.583> and<00:31:08.727> flip-flops.

00:31:09.289 --> 00:31:13.609
He<00:31:09.321> didn't<00:31:09.610> look<00:31:09.771> like<00:31:10.012> all<00:31:10.108> the<00:31:10.253> other<00:31:10.430> entrepreneurs<00:31:11.152> that<00:31:11.233> used<00:31:11.393> to<00:31:11.473> wear<00:31:11.698> Banana<00:31:11.955> Republic<00:31:12.501> outfits<00:31:12.919> in<00:31:13.063> to<00:31:13.224> pitch<00:31:13.545> us.

00:31:14.188 --> 00:31:20.435
Comes<00:31:14.380> into<00:31:14.525> the<00:31:14.589> conference<00:31:15.151> room,<00:31:15.489> super<00:31:15.970> irreverent,<00:31:17.400> uh,<00:31:17.817> and<00:31:17.978> was<00:31:18.203> like,<00:31:18.444> look,<00:31:18.604> I<00:31:18.685> want<00:31:18.765> to<00:31:18.845> build<00:31:19.022> headphones<00:31:19.584> for<00:31:19.664> snowboarders.

00:31:21.029 --> 00:31:26.859
And<00:31:21.174> I<00:31:21.190> think<00:31:21.495> quite<00:31:21.816> quickly<00:31:22.218> I<00:31:22.298> was<00:31:22.459> like,<00:31:22.619> look,<00:31:22.876> our<00:31:23.037> firm,<00:31:23.519> we<00:31:23.663> do<00:31:23.840> internet,<00:31:24.322> software,<00:31:25.028> life<00:31:25.205> sciences,<00:31:25.767> we'll<00:31:25.960> never<00:31:26.169> invest<00:31:26.634> in<00:31:26.715> that.

00:31:27.853 --> 00:31:29.888
But<00:31:27.997> as<00:31:28.109> a<00:31:28.157> snowboarder,<00:31:29.055> I<00:31:29.199> get<00:31:29.359> what<00:31:29.439> you're<00:31:29.551> saying.

00:31:29.936 --> 00:31:31.667
I<00:31:30.016> think<00:31:30.176> it's<00:31:30.273> a<00:31:30.417> cool<00:31:30.577> vision<00:31:30.897> and<00:31:31.042> you<00:31:31.122> should<00:31:31.378> do<00:31:31.538> it.

00:31:32.099 --> 00:31:39.807
And<00:31:32.243> I<00:31:32.324> can<00:31:32.484> totally<00:31:32.836> see,<00:31:33.686> you<00:31:33.782> know,<00:31:34.327> shops<00:31:34.663> like<00:31:34.887> Salty<00:31:35.304> Peaks<00:31:35.705> or<00:31:35.785> Milo<00:31:36.266> selling<00:31:36.810> this,<00:31:37.051> like<00:31:37.291> local<00:31:37.547> Salt<00:31:37.788> Lake<00:31:38.012> City<00:31:38.429> core<00:31:39.294> shops.

00:31:40.496 --> 00:31:51.344
And<00:31:41.489> so<00:31:43.140> that<00:31:43.460> led<00:31:43.653> to<00:31:44.198> him<00:31:44.438> talking<00:31:44.903> me<00:31:45.063> out<00:31:45.095> of<00:31:45.239> my<00:31:45.399> credit<00:31:45.864> card<00:31:46.265> to<00:31:46.425> pay<00:31:46.681> for<00:31:47.899> a<00:31:48.027> trade<00:31:48.444> show<00:31:49.005> excursion<00:31:49.662> to<00:31:49.806> the<00:31:49.886> Consumer<00:31:50.367> Electronics<00:31:51.152> Show.

00:31:51.889 --> 00:31:53.379
He<00:31:52.033> goes<00:31:52.290> down<00:31:52.530> with<00:31:52.674> the<00:31:52.754> samples.

00:31:53.893 --> 00:31:55.032
Calls<00:31:54.213> me<00:31:54.358> after<00:31:54.615> the<00:31:54.695> show.

00:31:55.417 --> 00:31:58.417
This<00:31:55.673> is<00:31:55.882> Rick<00:31:56.122> Albin,<00:31:56.443> by<00:31:56.540> the<00:31:56.684> way,<00:31:56.941> from<00:31:57.181> Skullcandy,<00:31:57.823> the<00:31:57.903> founder.

00:31:59.251 --> 00:32:01.481
And<00:31:59.331> he<00:31:59.427> says,<00:31:59.796> hey,<00:32:00.470> good<00:32:00.646> news<00:32:00.855> and<00:32:00.951> bad<00:32:01.192> news.

00:32:01.673 --> 00:32:05.603
Like,<00:32:01.914> the<00:32:02.058> good<00:32:02.218> news<00:32:02.539> is<00:32:02.956> we<00:32:03.037> sold<00:32:03.357> $900,000<00:32:04.865> worth<00:32:05.042> of<00:32:05.106> headphones.

00:32:06.726 --> 00:32:09.502
The<00:32:06.871> bad<00:32:07.111> news<00:32:07.304> is<00:32:07.512> we<00:32:07.544> don't<00:32:07.753> have<00:32:07.929> any<00:32:08.090> money<00:32:08.491> to<00:32:08.571> pay<00:32:08.732> for<00:32:08.908> the<00:32:09.036> production.

00:32:10.977 --> 00:32:23.250
So<00:32:11.122> I<00:32:11.218> start<00:32:11.475> getting<00:32:11.764> on<00:32:11.844> the<00:32:12.004> phone,<00:32:12.405> we<00:32:12.501> build<00:32:12.726> out<00:32:12.806> some<00:32:12.919> fundraising<00:32:13.464> materials,<00:32:14.186> and<00:32:14.346> luckily<00:32:14.828> I<00:32:15.068> go<00:32:15.164> to<00:32:15.293> Greg<00:32:15.614> Warnock,<00:32:16.352> one<00:32:16.448> of<00:32:16.512> the<00:32:16.592> partners<00:32:16.913> of<00:32:17.057> East<00:32:17.186> Spring,<00:32:17.539> and<00:32:17.587> I'm<00:32:17.699> like,<00:32:17.956> look,<00:32:18.918> I<00:32:19.015> know<00:32:19.400> that<00:32:19.560> this<00:32:19.720> is<00:32:19.817> not<00:32:20.057> in<00:32:20.138> our<00:32:20.282> investment<00:32:20.763> charter,<00:32:21.405> but<00:32:21.485> I<00:32:21.565> think<00:32:21.790> this<00:32:21.966> entrepreneur<00:32:22.512> deserves<00:32:22.784> some<00:32:23.009> money.

00:32:23.330 --> 00:32:31.813
I'm<00:32:23.490> gonna<00:32:23.651> invest<00:32:24.309> I'm<00:32:24.566> gonna<00:32:24.695> write<00:32:24.936> an<00:32:25.080> angel<00:32:25.402> check,<00:32:26.446> um,<00:32:26.864> and<00:32:27.008> I<00:32:27.024> don't<00:32:27.233> have<00:32:27.362> a<00:32:27.410> lot<00:32:27.587> of<00:32:27.619> money,<00:32:28.615> um,<00:32:29.178> and<00:32:30.142> I<00:32:30.238> think<00:32:30.720> it<00:32:30.784> would<00:32:30.881> be<00:32:30.977> interesting<00:32:31.363> for<00:32:31.604> you.

00:32:32.005 --> 00:32:36.810
He's<00:32:32.230> also<00:32:32.552> a<00:32:32.568> snowboarder,<00:32:33.998> and,<00:32:34.399> uh,<00:32:34.657> so<00:32:34.817> he<00:32:34.978> wrote<00:32:35.155> a<00:32:35.219> $250,000<00:32:36.424> check.

00:32:37.613 --> 00:32:43.220
Around<00:32:37.934> this<00:32:38.111> time,<00:32:38.898> uh,<00:32:39.139> we<00:32:39.236> got<00:32:39.412> connected<00:32:39.878> with<00:32:40.039> Jeremy<00:32:40.441> Andrus,<00:32:41.148> who'd<00:32:41.325> gone<00:32:41.566> to<00:32:41.646> BYU<00:32:41.887> at<00:32:42.031> the<00:32:42.224> same<00:32:42.514> time<00:32:42.706> I<00:32:42.931> did.

00:32:43.879 --> 00:32:45.631
And<00:32:44.152> so<00:32:44.361> I<00:32:44.393> started<00:32:44.683> interviewing<00:32:45.181> Jeremy.

00:32:46.386 --> 00:32:55.533
Jeremy<00:32:46.771> agrees<00:32:47.109> to<00:32:47.205> not<00:32:47.430> only<00:32:47.752> join<00:32:48.298> at<00:32:48.458> sort<00:32:48.635> of<00:32:48.716> a<00:32:48.876> discounted<00:32:49.680> rate<00:32:50.306> like<00:32:50.643> we<00:32:50.739> didn't<00:32:50.963> have<00:32:51.124> enough<00:32:51.380> money<00:32:51.605> to<00:32:51.765> even<00:32:52.086> pay<00:32:52.406> him<00:32:52.791> what<00:32:52.887> he<00:32:53.048> deserved<00:32:53.769> or<00:32:53.850> what<00:32:54.074> he<00:32:54.106> had<00:32:54.250> been<00:32:54.411> making<00:32:54.812> in<00:32:54.876> his<00:32:55.036> career.

00:32:56.159 --> 00:33:06.293
He<00:32:56.255> not<00:32:56.495> only<00:32:56.736> took<00:32:56.960> the<00:32:57.057> job,<00:32:57.698> I<00:32:57.778> think<00:32:57.938> he<00:32:57.987> was<00:32:58.099> initially,<00:32:58.484> his<00:32:58.820> title<00:32:59.125> was<00:32:59.301> president<00:33:00.183> and<00:33:00.263> COO<00:33:00.600> if<00:33:00.745> I<00:33:00.825> remember<00:33:01.226> right,<00:33:02.428> but<00:33:02.589> he<00:33:02.749> invested<00:33:04.096> alongside<00:33:04.849> of<00:33:04.978> him<00:33:05.298> joining<00:33:05.795> the<00:33:05.876> company.

00:33:06.517 --> 00:33:09.852
And<00:33:06.581> I<00:33:06.693> can<00:33:06.934> tell<00:33:07.383> you,<00:33:08.441> this<00:33:08.602> was<00:33:08.762> not<00:33:09.147> very<00:33:09.323> far<00:33:09.564> along.

00:33:10.269 --> 00:33:14.583
This<00:33:10.446> was<00:33:10.670> a<00:33:11.007> risk-taking<00:33:11.873> move<00:33:12.674> on,<00:33:12.995> on<00:33:13.091> the<00:33:13.171> part<00:33:13.412> of<00:33:13.556> everyone<00:33:13.957> who<00:33:14.118> got<00:33:14.278> involved.

00:33:14.695 --> 00:33:17.709
Like<00:33:15.737> it<00:33:15.881> was<00:33:16.042> hard<00:33:16.298> to<00:33:16.394> see<00:33:16.699> that<00:33:16.859> this<00:33:17.020> could<00:33:17.180> be<00:33:17.341> something.

00:33:18.302 --> 00:33:20.306
It<00:33:18.367> was<00:33:19.024> a<00:33:19.040> non-obvious<00:33:19.985> play.

00:33:21.091 --> 00:33:27.936
And<00:33:22.646> I<00:33:22.774> think<00:33:23.095> Rick<00:33:23.271> was<00:33:23.432> a<00:33:23.512> gifted<00:33:24.073> visionary<00:33:24.874> and<00:33:25.099> product<00:33:25.836> person,<00:33:26.477> great<00:33:26.798> product<00:33:27.182> sensibility.

00:33:29.106 --> 00:33:31.991
Jeremy,<00:33:29.538> of<00:33:29.683> course,<00:33:30.003> is<00:33:30.148> just<00:33:30.324> an<00:33:30.628> execution<00:33:31.366> freak.

00:33:32.071 --> 00:33:39.428
He<00:33:32.183> knows<00:33:32.408> how<00:33:32.488> to<00:33:32.568> get<00:33:32.808> things<00:33:33.129> done,<00:33:34.251> very<00:33:34.652> even-keeled<00:33:35.293> personality,<00:33:37.200> and<00:33:37.360> just<00:33:37.841> always<00:33:38.162> sort<00:33:38.274> of<00:33:38.418> makes<00:33:38.723> the<00:33:38.803> right<00:33:39.043> decision.

00:33:40.422 --> 00:33:43.660
And<00:33:40.502> so<00:33:40.662> you<00:33:40.742> put<00:33:40.983> those<00:33:41.207> two<00:33:41.303> together<00:33:41.784> and<00:33:41.880> you<00:33:41.945> have<00:33:42.105> this<00:33:42.409> really<00:33:42.730> powerful<00:33:43.147> combo.

00:33:44.253 --> 00:33:50.143
I<00:33:44.349> became<00:33:44.814> the<00:33:45.295> chairman<00:33:46.498> And<00:33:46.594> the<00:33:46.674> 3<00:33:47.060> of<00:33:47.220> us<00:33:47.782> operated<00:33:48.200> that<00:33:48.441> business<00:33:49.003> for<00:33:49.227> quite<00:33:49.484> some<00:33:49.645> time.

00:33:50.271 --> 00:33:51.379
I<00:33:50.287> don't<00:33:50.448> know,<00:33:50.512> another<00:33:50.913> decade.

00:33:51.973 --> 00:34:02.779
And<00:33:52.053> the<00:33:52.439> growth<00:33:52.776> numbers<00:33:53.242> were<00:33:53.402> like<00:33:54.366> 1,<00:33:54.783> 9,<00:33:55.425> 35,<00:33:56.485> 75,<00:33:57.737> 125,<00:33:59.102> 175,<00:34:00.644> 225,<00:34:01.912> 300.

00:34:03.213 --> 00:34:06.215
Like,<00:34:03.694> that's<00:34:03.919> not<00:34:04.032> exactly<00:34:04.497> what<00:34:04.658> the<00:34:04.738> numbers<00:34:05.204> were,<00:34:05.396> but<00:34:05.621> more<00:34:05.766> or<00:34:05.942> less.

00:34:07.131 --> 00:34:11.241
Um,<00:34:07.452> and<00:34:07.612> in<00:34:07.933> 2011,<00:34:08.672> we<00:34:08.833> were<00:34:08.977> able<00:34:09.154> to<00:34:09.234> take<00:34:09.475> that<00:34:09.635> business<00:34:10.021> public<00:34:10.502> on<00:34:10.583> the<00:34:10.615> NASDAQ.

00:34:12.108 --> 00:34:18.002
Um,<00:34:12.445> which<00:34:12.606> for<00:34:12.767> a<00:34:12.847> consumer<00:34:13.313> products<00:34:13.730> company<00:34:14.597> in<00:34:15.818> Utah,<00:34:16.203> I<00:34:16.380> think<00:34:16.540> was<00:34:16.701> a<00:34:16.781> pretty<00:34:17.006> extraordinary<00:34:17.600> moment.

00:34:18.066 --> 00:34:23.333
There<00:34:18.210> hadn't<00:34:18.467> been<00:34:18.708> very<00:34:18.949> many<00:34:19.190> consumer<00:34:19.816> companies<00:34:20.459> that<00:34:20.539> had<00:34:21.117> grown<00:34:21.358> that<00:34:21.663> quickly<00:34:22.000> or<00:34:22.161> become<00:34:22.466> that<00:34:22.642> substantial.

00:34:24.088 --> 00:34:31.539
And<00:34:24.232> then,<00:34:24.473> uh,<00:34:24.634> 2<00:34:24.794> years<00:34:24.971> later,<00:34:25.356> the<00:34:25.453> business<00:34:25.854> received<00:34:26.175> an<00:34:26.320> unsolicited<00:34:26.962> offer<00:34:27.283> from<00:34:27.396> a<00:34:27.604> private<00:34:27.861> equity<00:34:28.247> firm,<00:34:28.905> which<00:34:29.066> was<00:34:29.226> substantially<00:34:29.804> more<00:34:30.174> than<00:34:30.270> the<00:34:30.415> company<00:34:30.656> was<00:34:30.768> trading<00:34:31.153> for.

00:34:31.956 --> 00:34:38.460
So<00:34:32.181> we<00:34:32.342> did<00:34:32.454> a<00:34:32.502> mini<00:34:32.839> process<00:34:33.546> and<00:34:33.642> ended<00:34:33.867> up<00:34:33.964> selling<00:34:34.365> the<00:34:34.445> business,<00:34:34.911> taking<00:34:35.184> it<00:34:35.328> private,<00:34:36.437> um,<00:34:36.934> which<00:34:37.095> I<00:34:37.239> wish<00:34:37.416> it<00:34:37.496> would've<00:34:37.657> stayed<00:34:37.978> public.

00:34:38.685 --> 00:34:43.726
Uh,<00:34:39.326> And<00:34:39.487> I<00:34:39.567> was<00:34:39.744> told<00:34:39.984> last<00:34:40.241> year<00:34:40.386> by<00:34:40.530> one<00:34:40.643> of<00:34:40.723> the<00:34:40.787> employees,<00:34:41.269> they<00:34:41.349> had<00:34:41.510> their<00:34:41.671> best<00:34:41.976> year<00:34:42.297> ever<00:34:42.811> in<00:34:42.875> the<00:34:43.019> company<00:34:43.341> history.

00:34:44.625 --> 00:34:46.857
So<00:34:45.043> I<00:34:45.123> think<00:34:45.284> the<00:34:45.364> business<00:34:45.685> is<00:34:45.942> doing<00:34:46.408> real<00:34:46.713> well.

00:34:47.130 --> 00:34:48.094
It's<00:34:47.291> kind<00:34:47.452> of<00:34:47.532> quiet.

00:34:48.238 --> 00:34:49.684
I<00:34:48.335> don't<00:34:48.720> hear<00:34:48.913> a<00:34:49.041> lot<00:34:49.202> about<00:34:49.603> it.

00:34:50.487 --> 00:34:52.911
I<00:34:50.583> know<00:34:51.129> the<00:34:51.209> CEO<00:34:51.771> there<00:34:51.932> used<00:34:52.108> to<00:34:52.189> be<00:34:52.269> our<00:34:52.365> CFO.

00:34:53.393 --> 00:34:56.251
He's<00:34:53.634> an<00:34:54.019> unbelievable<00:34:54.678> leader,<00:34:55.240> terrific<00:34:55.802> person.

00:34:57.183 --> 00:35:06.208
So<00:34:57.568> I<00:34:57.649> think<00:34:57.809> they<00:34:57.954> have<00:34:58.114> great<00:34:58.371> leadership<00:34:59.078> and<00:34:59.897> it's<00:34:59.993> kind<00:35:00.186> of<00:35:00.282> cool<00:35:00.459> to<00:35:00.539> see<00:35:00.780> this<00:35:01.824> brand,<00:35:02.691> you<00:35:02.723> know,<00:35:02.948> continuing<00:35:03.831> to<00:35:04.056> execute<00:35:04.489> as<00:35:04.698> well<00:35:04.811> as<00:35:05.035> it<00:35:05.180> is<00:35:05.437> after<00:35:05.678> all<00:35:05.838> these<00:35:06.079> years.

00:35:07.044 --> 00:35:15.152
But<00:35:07.349> it<00:35:07.413> was<00:35:07.525> a<00:35:07.606> really<00:35:08.232> great<00:35:08.392> experience,<00:35:08.906> and<00:35:09.051> that<00:35:09.613> probably<00:35:09.950> took<00:35:10.255> like<00:35:10.560> the<00:35:10.592> next,<00:35:11.925> you<00:35:12.021> know,<00:35:12.198> 7<00:35:12.744> years<00:35:13.049> of<00:35:13.145> my<00:35:13.225> life,<00:35:13.771> even<00:35:13.948> though<00:35:14.092> it<00:35:14.189> was<00:35:14.430> part-time.

00:35:16.260 --> 00:35:18.861
That<00:35:16.421> was<00:35:16.597> a<00:35:16.613> substantial<00:35:17.223> part<00:35:17.416> of<00:35:17.561> it<00:35:17.721> and<00:35:17.818> a<00:35:17.946> really<00:35:18.203> fun<00:35:18.508> ride.

00:35:19.471 --> 00:35:41.609
Instead<00:35:19.744> of<00:35:19.873> going<00:35:20.114> to<00:35:20.194> like<00:35:20.611> boring<00:35:21.077> Gartner<00:35:21.495> conferences<00:35:22.281> to<00:35:22.378> talk<00:35:22.635> about<00:35:23.180> magic<00:35:23.582> quadrants<00:35:24.224> and<00:35:24.369> whatnot,<00:35:25.332> it<00:35:25.412> was<00:35:25.653> like<00:35:25.926> sponsoring,<00:35:26.954> you<00:35:27.034> know,<00:35:27.195> the<00:35:27.275> surf<00:35:27.612> industry<00:35:28.078> and<00:35:28.222> the<00:35:28.254> snowboard<00:35:28.816> industry,<00:35:29.443> and<00:35:29.587> the<00:35:29.683> trade<00:35:30.005> shows<00:35:30.470> felt<00:35:30.727> more<00:35:30.823> like<00:35:31.129> parties<00:35:31.690> than<00:35:32.333> business<00:35:32.750> events<00:35:33.295> and<00:35:33.568> just<00:35:34.162> an<00:35:34.242> extraordinarily<00:35:35.302> great<00:35:35.622> time,<00:35:36.987> you<00:35:37.067> know,<00:35:37.147> to<00:35:37.243> reflect<00:35:37.709> upon<00:35:38.110> great<00:35:38.351> business,<00:35:38.816> great<00:35:39.073> people,<00:35:40.036> and<00:35:40.116> just<00:35:40.357> a<00:35:40.437> terrific<00:35:40.902> success<00:35:41.239> story.

00:35:42.764 --> 00:35:44.016
And<00:35:42.812> then<00:35:42.925> you<00:35:43.021> had<00:35:43.229> like<00:35:43.390> competitors.

00:35:44.128 --> 00:35:46.937
People<00:35:44.529> don't<00:35:44.690> realize<00:35:44.882> Skullcandy<00:35:45.492> came<00:35:45.717> out<00:35:45.813> before<00:35:46.134> Beats<00:35:46.439> by<00:35:46.616> Dre.

00:35:48.365 --> 00:35:50.291
And<00:35:48.766> that<00:35:49.007> is<00:35:49.183> actually<00:35:49.408> a<00:35:49.488> great<00:35:49.745> story<00:35:50.130> there.

00:35:51.334 --> 00:35:51.462
Oh<00:35:51.414> yeah.

00:35:51.591 --> 00:35:52.473
Tell<00:35:51.847> me<00:35:51.992> about<00:35:52.233> that.

00:35:52.634 --> 00:35:55.940
Like,<00:35:52.858> what<00:35:53.019> is<00:35:53.179> the—<00:35:53.597> what<00:35:53.757> is<00:35:53.902> the<00:35:53.934> intersection<00:35:54.479> between<00:35:54.736> Skullcandy<00:35:55.346> and<00:35:55.442> Beats<00:35:55.667> by<00:35:55.827> Dre?

00:35:57.143 --> 00:35:58.379
I'll<00:35:57.352> tell<00:35:57.448> you<00:35:57.529> how<00:35:57.625> it<00:35:57.753> all<00:35:57.850> started.

00:35:58.572 --> 00:36:10.227
So<00:35:59.294> we<00:35:59.454> were<00:35:59.599> over<00:36:00.321> at<00:36:00.594> a<00:36:00.658> factory<00:36:01.284> of<00:36:01.380> ours<00:36:02.086> in<00:36:02.263> China<00:36:03.692> that<00:36:03.869> was<00:36:04.045> gonna<00:36:04.270> produce<00:36:04.736> the<00:36:04.816> initial<00:36:05.394> Beats<00:36:05.715> by<00:36:05.860> Dre<00:36:06.181> product,<00:36:06.663> which<00:36:06.775> at<00:36:06.920> the<00:36:07.000> time<00:36:07.385> was<00:36:07.562> a<00:36:07.706> joint<00:36:08.044> venture<00:36:08.365> with<00:36:08.541> a<00:36:08.606> company<00:36:08.991> called<00:36:09.408> Monster<00:36:09.890> Cable.

00:36:10.292 --> 00:36:14.434
It<00:36:10.436> was<00:36:10.484> sort<00:36:10.693> of<00:36:10.837> Jimmy<00:36:11.159> Iovine<00:36:11.640> had<00:36:11.801> partnered<00:36:12.138> with<00:36:12.283> this<00:36:12.379> electronics<00:36:13.102> company<00:36:13.503> to<00:36:13.664> build<00:36:13.888> headphones.

00:36:15.333 --> 00:36:22.768
And<00:36:16.955> they<00:36:17.116> gave<00:36:17.421> us,<00:36:17.838> they<00:36:17.919> gave<00:36:18.176> me<00:36:18.738> a<00:36:18.802> pair<00:36:19.043> of<00:36:19.107> the<00:36:19.187> headphones<00:36:19.701> and<00:36:19.829> I<00:36:19.910> brought<00:36:20.102> it<00:36:20.167> back<00:36:20.407> on<00:36:20.488> the<00:36:20.632> plane<00:36:20.953> from<00:36:21.130> China<00:36:21.515> and<00:36:21.612> I<00:36:21.692> brought<00:36:21.869> it<00:36:21.997> to<00:36:22.077> our<00:36:22.238> product<00:36:22.639> team.

00:36:23.844 --> 00:36:25.449
And<00:36:23.940> our<00:36:24.020> product<00:36:24.341> team<00:36:24.502> was<00:36:24.663> very<00:36:24.903> dismissive.

00:36:25.642 --> 00:36:26.557
It's<00:36:25.867> a<00:36:25.931> great<00:36:26.188> lesson.

00:36:27.135 --> 00:36:28.661
They<00:36:27.216> were<00:36:27.376> like,<00:36:27.633> $300?

00:36:29.239 --> 00:36:30.202
No<00:36:29.383> one's<00:36:29.480> gonna<00:36:29.640> pay<00:36:29.801> $300.

00:36:30.604 --> 00:36:38.032
They<00:36:30.748> looked<00:36:30.925> at<00:36:31.005> the<00:36:31.166> NPD<00:36:31.808> data,<00:36:32.274> which<00:36:32.466> is<00:36:32.675> this,<00:36:33.092> firm<00:36:33.477> that,<00:36:34.279> you<00:36:34.375> know,<00:36:34.920> you<00:36:35.081> can<00:36:35.177> buy<00:36:35.482> all<00:36:35.578> of<00:36:35.738> the<00:36:35.883> retail<00:36:36.300> data<00:36:36.524> from<00:36:36.845> if<00:36:36.941> you're<00:36:37.101> a<00:36:37.182> consumer<00:36:37.663> company.

00:36:38.930 --> 00:36:44.495
And<00:36:39.090> it<00:36:39.267> basically<00:36:39.732> showed<00:36:40.149> that<00:36:40.293> only<00:36:40.485> about<00:36:40.774> 5,000<00:36:41.656> units<00:36:41.977> a<00:36:42.153> month<00:36:42.538> were<00:36:42.634> sold<00:36:43.420> over<00:36:43.677> $300.

00:36:45.617 --> 00:36:53.107
So<00:36:45.762> the<00:36:45.906> team<00:36:46.163> just<00:36:46.403> believed<00:36:46.884> that<00:36:47.125> that<00:36:47.446> price<00:36:47.766> point,<00:36:48.071> no<00:36:48.151> one<00:36:48.392> would<00:36:48.488> show<00:36:48.648> up<00:36:48.809> to<00:36:48.889> buy<00:36:49.049> the<00:36:49.210> product,<00:36:50.092> even<00:36:50.316> though<00:36:50.413> the<00:36:50.573> product<00:36:51.038> looked<00:36:51.375> differentiated<00:36:52.257> and<00:36:52.321> was<00:36:52.578> pretty<00:36:52.818> cool.

00:36:54.406 --> 00:37:01.927
And<00:36:54.983> I<00:36:55.063> think<00:36:55.160> it's<00:36:55.240> a<00:36:55.304> great<00:36:55.609> example<00:36:56.090> of<00:36:56.266> like<00:36:57.549> underestimating<00:36:58.688> underestimate<00:36:59.634> your<00:36:59.794> competitor<00:37:00.596> just<00:37:00.981> because<00:37:01.462> they're<00:37:01.574> small.

00:37:02.664 --> 00:37:09.255
You<00:37:02.761> think<00:37:02.985> just<00:37:03.146> because<00:37:03.418> they're<00:37:03.562> so<00:37:03.723> small,<00:37:04.364> they<00:37:04.525> can't<00:37:04.829> have<00:37:05.070> a<00:37:05.727> differentiated<00:37:06.850> idea,<00:37:07.571> but<00:37:07.716> in<00:37:07.812> reality,<00:37:08.373> they<00:37:08.533> often<00:37:08.934> do.

00:37:09.880 --> 00:37:11.067
And<00:37:10.041> in<00:37:10.137> this<00:37:10.297> case,<00:37:10.602> they<00:37:10.778> did.

00:37:11.580 --> 00:37:17.048
So<00:37:11.740> the<00:37:11.821> company<00:37:12.125> starts<00:37:12.382> growing<00:37:12.686> quite<00:37:12.847> quickly<00:37:13.344> because<00:37:13.745> it<00:37:13.985> very<00:37:14.146> much<00:37:14.386> became<00:37:14.707> a<00:37:14.723> status<00:37:15.220> symbol,<00:37:15.509> almost<00:37:15.749> like<00:37:15.974> wearing<00:37:16.214> a<00:37:16.310> Rolex<00:37:16.791> watch.

00:37:17.112 --> 00:37:25.915
People<00:37:17.433> wanted<00:37:17.898> to<00:37:17.978> have<00:37:18.315> this<00:37:18.555> cranial<00:37:19.437> billboard<00:37:20.079> of,<00:37:20.784> I've<00:37:21.121> made<00:37:21.361> it,<00:37:21.506> I<00:37:21.602> can<00:37:21.746> afford<00:37:22.179> $300<00:37:23.029> headphones,<00:37:24.328> you<00:37:24.424> know,<00:37:24.633> look<00:37:24.777> how<00:37:24.889> powerful<00:37:25.514> I<00:37:25.691> am.

00:37:26.397 --> 00:37:26.541
Oh<00:37:26.493> yeah.

00:37:26.654 --> 00:37:30.652
And<00:37:27.055> we<00:37:27.200> saw<00:37:27.457> that,<00:37:27.938> we<00:37:28.035> saw<00:37:28.275> it<00:37:28.404> show<00:37:28.581> up<00:37:28.757> in<00:37:29.126> the<00:37:29.207> numbers<00:37:29.785> quarter<00:37:30.170> over<00:37:30.411> quarter.

00:37:30.748 --> 00:37:33.959
We<00:37:30.909> could<00:37:31.069> see<00:37:31.471> them<00:37:31.711> selling<00:37:32.113> more<00:37:32.354> and<00:37:32.514> more<00:37:32.851> in<00:37:32.996> the<00:37:33.140> NPD<00:37:33.542> data.

00:37:34.280 --> 00:37:35.741
We<00:37:34.361> could<00:37:34.457> see<00:37:34.666> their<00:37:34.762> distribution<00:37:35.340> expanding.

00:37:35.806 --> 00:37:50.095
So<00:37:35.950> that<00:37:36.191> led<00:37:36.351> to<00:37:36.432> lots<00:37:36.673> of<00:37:36.753> conversations<00:37:37.652> with<00:37:37.893> Jimmy<00:37:38.198> Iovine,<00:37:38.696> culminating<00:37:39.257> in<00:37:39.338> a<00:37:39.402> conversation<00:37:40.124> where,<00:37:40.863> while<00:37:41.104> we<00:37:41.264> were<00:37:41.425> much<00:37:41.746> bigger,<00:37:43.432> we<00:37:43.528> still<00:37:43.898> both<00:37:44.315> viewed<00:37:44.540> our<00:37:44.700> competitors<00:37:45.359> as<00:37:45.519> Sony<00:37:46.081> and<00:37:46.242> Bose<00:37:46.643> and<00:37:46.739> Sennheiser,<00:37:48.168> the<00:37:48.554> incumbents,<00:37:49.356> not<00:37:49.533> each<00:37:49.758> other.

00:37:52.456 --> 00:37:54.656
Orchestrated<00:37:52.957> a<00:37:53.038> deal<00:37:53.281> to<00:37:53.362> put<00:37:53.524> the<00:37:53.605> two<00:37:53.831> companies<00:37:54.252> together.

00:37:54.802 --> 00:37:57.148
We<00:37:54.883> were<00:37:54.980> gonna<00:37:55.142> merge<00:37:55.530> them<00:37:55.708> on<00:37:55.854> like<00:37:55.967> a<00:37:56.032> 50/50<00:37:56.760> basis.

00:37:57.812 --> 00:38:14.322
And<00:37:57.893> this<00:37:58.071> is<00:37:58.216> always<00:37:58.605> really<00:37:58.864> difficult<00:37:59.657> merging<00:38:00.061> two<00:38:00.158> private<00:38:00.563> companies<00:38:01.703> because<00:38:02.187> how<00:38:02.348> do<00:38:02.428> you<00:38:02.525> assign<00:38:02.896> value<00:38:03.234> to<00:38:03.379> growth<00:38:04.023> versus<00:38:04.990> revenue<00:38:05.635> versus,<00:38:08.148> you<00:38:08.244> know,<00:38:09.115> profit<00:38:09.517> margins<00:38:10.227> versus<00:38:10.796> whatever<00:38:11.283> other<00:38:12.421> intangibles<00:38:13.250> exist<00:38:13.640> in<00:38:13.721> these<00:38:13.900> businesses.

00:38:14.403 --> 00:38:15.898
It's<00:38:14.550> so<00:38:14.858> hard<00:38:15.118> to<00:38:15.200> get<00:38:15.346> them<00:38:15.443> to<00:38:15.525> come<00:38:15.687> together.

00:38:16.771 --> 00:38:20.097
So<00:38:17.062> we<00:38:17.724> gut<00:38:17.966> check<00:38:18.208> the<00:38:18.353> idea<00:38:18.692> at<00:38:18.838> a<00:38:18.854> Skullcandy<00:38:19.564> board<00:38:19.822> meeting.

00:38:20.210 --> 00:38:21.469
We<00:38:20.307> try<00:38:20.533> and<00:38:20.630> socialize<00:38:21.082> the<00:38:21.130> idea<00:38:21.195> with<00:38:21.324> the<00:38:21.404> board.

00:38:21.517 --> 00:38:26.508
We<00:38:21.550> know<00:38:21.582> the<00:38:21.614> idea<00:38:21.679> that<00:38:21.727> we're<00:38:21.840> gonna<00:38:23.890> gonna<00:38:24.323> take<00:38:24.484> 50%<00:38:25.030> when<00:38:25.207> we<00:38:25.287> were<00:38:25.432> already<00:38:25.849> much<00:38:26.155> bigger.

00:38:27.151 --> 00:38:30.589
So<00:38:27.392> the<00:38:27.472> smaller<00:38:28.243> company<00:38:29.239> is<00:38:29.464> gonna<00:38:29.609> own<00:38:29.850> half<00:38:30.107> the<00:38:30.267> equity.

00:38:30.653 --> 00:38:36.677
We<00:38:30.749> knew<00:38:31.006> that<00:38:31.231> was<00:38:31.488> not<00:38:31.794> gonna<00:38:32.115> go<00:38:32.275> over<00:38:32.661> very<00:38:32.918> well<00:38:34.284> because<00:38:34.589> we<00:38:34.669> thought<00:38:34.862> the<00:38:35.007> board<00:38:35.248> would<00:38:35.408> say,<00:38:35.713> well,<00:38:36.195> we're<00:38:36.372> bigger.

00:38:36.774 --> 00:38:38.396
We<00:38:36.934> should<00:38:37.240> get<00:38:37.416> a<00:38:37.481> majority<00:38:37.914> of<00:38:38.059> the<00:38:38.139> deal.

00:38:39.183 --> 00:38:50.959
My<00:38:39.328> argument<00:38:39.810> was<00:38:40.388> this<00:38:40.613> company's<00:38:41.031> growing<00:38:41.352> faster<00:38:42.396> and<00:38:42.477> they're<00:38:42.621> growing<00:38:42.878> faster<00:38:43.521> in<00:38:43.666> the<00:38:43.826> high-end<00:38:44.324> dollar<00:38:44.646> segment,<00:38:45.288> which<00:38:46.075> the<00:38:46.108> consumer<00:38:46.557> brand,<00:38:46.830> it's<00:38:46.975> very<00:38:47.216> hard<00:38:47.457> to<00:38:47.537> go<00:38:47.923> up<00:38:48.565> in<00:38:48.806> product<00:38:49.208> positioning,<00:38:49.899> quite<00:38:50.252> easy<00:38:50.445> to<00:38:50.574> come<00:38:50.750> down.

00:38:51.697 --> 00:38:57.874
A<00:38:51.713> good<00:38:51.874> way<00:38:51.970> to<00:38:52.098> think<00:38:52.259> about<00:38:52.499> this<00:38:52.676> would<00:38:52.836> be<00:38:52.933> like<00:38:53.959> Canon<00:38:54.521> dominates<00:38:55.227> the<00:38:55.323> digital<00:38:55.868> SLR<00:38:56.991> camera<00:38:57.408> business.

00:38:58.435 --> 00:39:05.879
You<00:38:58.531> look<00:38:58.708> on<00:38:58.836> the<00:38:58.868> sidelines<00:38:59.638> of<00:38:59.799> a<00:39:00.200> Utah<00:39:00.521> Jazz<00:39:00.858> game,<00:39:01.082> most<00:39:01.275> of<00:39:01.339> the<00:39:01.419> camera<00:39:01.740> people<00:39:01.981> are<00:39:02.141> using<00:39:03.088> big<00:39:03.264> fancy<00:39:03.665> Canon<00:39:04.531> lenses<00:39:05.350> and<00:39:05.430> bodies.

00:39:06.858 --> 00:39:15.425
And<00:39:06.954> so<00:39:07.130> when<00:39:07.275> they<00:39:07.499> went<00:39:07.596> into<00:39:07.772> the<00:39:07.917> point-and-shoot<00:39:08.478> business,<00:39:09.264> you<00:39:09.344> know,<00:39:09.585> years<00:39:09.842> ago,<00:39:10.724> they<00:39:10.868> had<00:39:11.269> a<00:39:11.285> natural<00:39:12.104> license<00:39:12.633> to<00:39:12.794> come<00:39:12.970> down<00:39:13.211> because<00:39:13.531> they<00:39:13.756> were<00:39:14.013> the<00:39:14.334> experts<00:39:14.831> at<00:39:14.895> the<00:39:15.040> high<00:39:15.296> end.

00:39:16.243 --> 00:39:28.138
Very<00:39:16.580> hard<00:39:16.884> if<00:39:17.045> you<00:39:17.141> were<00:39:17.302> kind<00:39:17.478> of<00:39:17.606> a<00:39:17.767> low-grade<00:39:18.328> consumer<00:39:18.745> products<00:39:19.130> company<00:39:19.628> to<00:39:19.933> then<00:39:20.414> come<00:39:20.815> up<00:39:22.754> And<00:39:22.898> so<00:39:23.251> it<00:39:23.379> sort<00:39:23.699> of<00:39:23.780> shows<00:39:24.276> the<00:39:24.421> power<00:39:24.901> of<00:39:25.222> premium<00:39:25.558> brand<00:39:25.879> positioning,<00:39:26.904> which<00:39:27.161> Beats<00:39:27.401> by<00:39:27.561> Dre<00:39:27.866> had.

00:39:28.282 --> 00:39:34.500
Easy<00:39:28.523> for<00:39:28.683> them<00:39:28.843> to<00:39:28.987> come<00:39:29.164> down<00:39:29.452> because<00:39:29.708> they<00:39:29.789> already<00:39:30.109> owned<00:39:30.365> the<00:39:30.446> top,<00:39:31.006> much<00:39:31.231> higher,<00:39:31.888> like<00:39:31.984> a<00:39:32.048> premium<00:39:32.449> Skullcandy<00:39:33.009> product<00:39:33.330> back<00:39:33.554> then<00:39:33.714> was<00:39:33.811> like<00:39:34.051> $99.

00:39:35.717 --> 00:39:39.900
And<00:39:35.814> so<00:39:35.974> the<00:39:36.054> fact<00:39:36.278> that<00:39:36.374> they<00:39:36.519> were<00:39:36.631> selling<00:39:36.935> at<00:39:37.079> $300,<00:39:37.752> it<00:39:37.881> was<00:39:38.217> a<00:39:38.233> noticeable<00:39:39.098> price<00:39:39.419> difference.

00:39:41.005 --> 00:39:43.505
And<00:39:41.903> long<00:39:42.079> story<00:39:42.303> short,<00:39:42.608> we<00:39:42.704> bring<00:39:42.864> this<00:39:43.024> to<00:39:43.104> our<00:39:43.329> board.

00:39:43.569 --> 00:39:44.979
We<00:39:43.649> had<00:39:43.810> some<00:39:43.970> private<00:39:44.306> equity<00:39:44.563> folks.

00:39:45.043 --> 00:39:46.357
Again,<00:39:45.412> I<00:39:45.508> won't<00:39:45.829> name<00:39:46.133> names.

00:39:46.486 --> 00:39:51.089
I<00:39:46.502> don't<00:39:46.774> think<00:39:46.934> that's<00:39:47.175> helpful,<00:39:47.655> but<00:39:48.377> They<00:39:48.538> threw<00:39:48.939> up<00:39:49.260> all<00:39:49.356> over<00:39:49.677> it<00:39:49.918> and<00:39:50.062> basically<00:39:50.560> killed<00:39:50.800> the<00:39:50.945> deal.

00:39:51.843 --> 00:39:53.577
And<00:39:51.924> we<00:39:52.084> had<00:39:52.245> another<00:39:52.870> board<00:39:53.047> observer.

00:39:53.673 --> 00:39:54.588
He<00:39:53.769> wasn't<00:39:54.010> a<00:39:54.154> board<00:39:54.331> member.

00:39:54.652 --> 00:39:55.823
His<00:39:54.716> name's<00:39:54.973> Brian<00:39:55.358> O'Malley.

00:39:57.043 --> 00:40:03.414
And<00:39:57.380> he<00:39:58.647> went<00:39:58.808> on<00:39:58.904> to—<00:39:59.225> at<00:39:59.305> the<00:39:59.386> time,<00:39:59.691> he<00:39:59.787> was<00:39:59.931> at<00:40:00.092> Battery<00:40:00.509> Ventures<00:40:02.114> and<00:40:02.194> they<00:40:02.338> were<00:40:02.370> an<00:40:02.451> investor<00:40:02.836> in<00:40:02.980> the<00:40:03.061> company.

00:40:04.184 --> 00:40:06.093
And<00:40:04.842> he<00:40:04.986> went<00:40:05.147> on<00:40:05.307> to<00:40:05.387> work<00:40:05.564> at<00:40:05.708> Accel.

00:40:06.447 --> 00:40:12.705
And<00:40:06.607> now,<00:40:06.832> he's<00:40:07.008> a<00:40:07.088> partner<00:40:07.393> at<00:40:07.474> Forerunner<00:40:08.035> with<00:40:08.196> Kirsten<00:40:08.613> Green,<00:40:09.415> great<00:40:09.720> consumer<00:40:10.202> investor,<00:40:11.822> really<00:40:12.127> fantastic.

00:40:13.411 --> 00:40:24.136
And<00:40:13.491> he<00:40:13.652> called<00:40:13.989> me<00:40:14.133> after<00:40:14.390> the<00:40:14.470> meeting<00:40:15.674> He's<00:40:15.835> like,<00:40:16.076> that<00:40:16.381> was<00:40:16.959> the<00:40:17.103> greatest<00:40:18.966> board<00:40:19.383> meeting<00:40:19.929> destruction<00:40:20.812> of<00:40:21.037> opportunity<00:40:22.321> I<00:40:22.337> have<00:40:22.659> ever<00:40:22.964> witnessed<00:40:23.381> in<00:40:23.526> my<00:40:23.702> career.

00:40:25.228 --> 00:40:31.971
Watching<00:40:25.789> like<00:40:26.255> this,<00:40:26.432> these<00:40:26.737> private<00:40:27.074> equity<00:40:27.459> guys<00:40:27.861> use<00:40:28.037> their<00:40:28.342> veto<00:40:28.680> right<00:40:29.787> on<00:40:29.964> this<00:40:30.221> merger<00:40:31.249> and<00:40:31.409> block<00:40:31.810> it.

00:40:32.694 --> 00:40:37.398
He<00:40:32.854> just<00:40:33.015> couldn't<00:40:33.256> believe<00:40:33.593> it<00:40:33.818> because<00:40:34.363> for<00:40:34.524> him,<00:40:34.701> it<00:40:34.845> was<00:40:34.941> just<00:40:35.150> such<00:40:35.343> an<00:40:35.568> obvious<00:40:35.905> decision<00:40:36.451> to<00:40:36.547> merge<00:40:36.868> the<00:40:36.948> companies.

00:40:38.377 --> 00:40:40.529
And<00:40:38.891> so<00:40:39.036> we<00:40:39.116> just<00:40:39.341> couldn't<00:40:39.662> get<00:40:39.822> it<00:40:39.855> through<00:40:40.079> our<00:40:40.304> board.

00:40:41.043 --> 00:40:46.502
That<00:40:41.284> led<00:40:41.508> to<00:40:41.605> a<00:40:41.669> falling<00:40:42.086> out<00:40:42.247> between<00:40:42.713> Rick<00:40:42.985> and<00:40:43.114> this<00:40:43.291> firm<00:40:44.639> because<00:40:44.912> he<00:40:45.378> couldn't<00:40:45.619> get<00:40:45.763> their<00:40:45.859> support.

00:40:46.983 --> 00:40:49.809
So<00:40:47.208> we<00:40:47.304> cut<00:40:47.465> a<00:40:47.545> deal<00:40:47.770> with<00:40:47.931> them<00:40:48.252> that<00:40:48.348> we<00:40:48.509> would<00:40:48.653> take<00:40:48.894> the<00:40:48.974> company<00:40:49.376> public.

00:40:49.938 --> 00:40:51.174
We<00:40:50.018> were<00:40:50.114> big<00:40:50.291> enough<00:40:50.596> to<00:40:50.740> do<00:40:50.917> that.

00:40:51.238 --> 00:40:58.110
We<00:40:51.270> didn't<00:40:51.415> really<00:40:51.720> want<00:40:51.928> to<00:40:52.041> do<00:40:52.201> it,<00:40:52.828> but<00:40:52.988> we<00:40:53.084> would<00:40:53.229> take<00:40:53.389> the<00:40:53.470> company<00:40:53.791> public<00:40:54.144> if<00:40:54.273> they<00:40:54.433> would<00:40:54.529> agree<00:40:54.851> to<00:40:54.931> get<00:40:55.156> off<00:40:55.332> the<00:40:55.412> board<00:40:55.718> on<00:40:55.878> the<00:40:55.974> IPO<00:40:56.456> date,<00:40:57.564> which<00:40:57.741> they<00:40:57.965> did.

00:40:59.330 --> 00:41:06.555
And<00:40:59.426> so<00:40:59.667> that<00:40:59.892> was<00:41:00.053> the<00:41:00.149> only<00:41:00.374> reason<00:41:00.631> Skullcandy<00:41:01.192> became<00:41:01.578> public,<00:41:02.461> was<00:41:02.557> to<00:41:02.637> sort<00:41:02.862> of<00:41:02.894> solve<00:41:03.424> these<00:41:03.681> broken<00:41:04.227> board<00:41:04.484> dynamics<00:41:05.190> that<00:41:05.271> had<00:41:05.431> happened<00:41:05.752> with<00:41:05.913> our<00:41:06.009> investor.

00:41:07.146 --> 00:41:13.735
Converting<00:41:07.486> them<00:41:07.647> to<00:41:07.792> common<00:41:08.212> and<00:41:08.358> getting<00:41:08.600> rid<00:41:08.713> of<00:41:08.842> all<00:41:09.020> their<00:41:09.262> rights<00:41:09.924> seemed<00:41:10.231> like<00:41:10.473> the<00:41:10.699> easiest<00:41:11.119> way<00:41:11.911> to<00:41:12.007> create<00:41:12.330> a<00:41:12.476> peace<00:41:13.299> accord.

00:41:14.850 --> 00:41:15.544
So<00:41:14.995> we<00:41:15.140> did<00:41:15.318> that.

00:41:16.280 --> 00:41:19.614
But<00:41:16.393> it's<00:41:16.490> a<00:41:16.555> sad<00:41:16.798> story<00:41:17.202> because<00:41:17.591> you<00:41:17.688> think<00:41:17.850> about<00:41:18.255> what<00:41:19.210> could<00:41:19.307> have<00:41:19.469> been.

00:41:19.728 --> 00:41:25.584
Of<00:41:19.873> course,<00:41:20.197> Beats<00:41:20.440> ultimately<00:41:20.861> sells<00:41:21.395> for<00:41:21.881> $3<00:41:22.221> billion,<00:41:24.487> not<00:41:24.730> long<00:41:24.956> after<00:41:25.294> that.

00:41:26.275 --> 00:41:34.171
So<00:41:27.144> the<00:41:27.305> overall<00:41:27.949> value<00:41:28.914> creation/destruction,<00:41:30.201> just<00:41:30.442> based<00:41:30.684> on<00:41:30.828> the<00:41:30.925> decisions<00:41:31.408> of<00:41:31.488> the<00:41:31.713> board,<00:41:32.704> So,<00:41:32.994> you<00:41:33.220> know,<00:41:33.397> great<00:41:33.719> case<00:41:33.881> study.

00:41:35.654 --> 00:41:36.556
Yeah,<00:41:35.799> it's<00:41:36.056> fascinating.

00:41:36.604 --> 00:41:40.795
And<00:41:36.685> then<00:41:36.846> Jeremy<00:41:37.249> goes<00:41:37.507> on,<00:41:37.733> Jeremy<00:41:37.991> Andrus,<00:41:38.458> who<00:41:38.539> was—<00:41:38.958> Jeremy<00:41:39.264> was<00:41:39.361> the<00:41:39.441> CEO<00:41:39.844> when<00:41:39.989> that<00:41:40.086> went<00:41:40.247> public,<00:41:40.634> right?

00:41:42.326 --> 00:41:42.407
Yeah.

00:41:42.504 --> 00:41:53.717
So,<00:41:42.892> about<00:41:43.085> 60<00:41:43.392> days<00:41:43.634> before<00:41:44.425> our<00:41:45.636> IPO,<00:41:46.395> some<00:41:46.702> things<00:41:47.025> came<00:41:47.267> up<00:41:47.413> with<00:41:47.671> Rick<00:41:48.381> and<00:41:49.043> he<00:41:49.867> sort<00:41:50.028> of<00:41:50.093> stepped<00:41:50.481> aside<00:41:51.637> and<00:41:52.443> Jeremy<00:41:52.862> took<00:41:53.104> over<00:41:53.330> as<00:41:53.426> the<00:41:53.507> CEO.

00:41:53.894 --> 00:42:00.569
It<00:41:53.991> was<00:41:54.136> either<00:41:54.700> recruiting<00:41:55.506> a<00:41:55.522> new<00:41:55.845> CEO<00:41:57.360> or—<00:41:58.102> and<00:41:58.505> sort<00:41:58.747> of<00:41:58.828> shelved<00:41:59.376> the<00:41:59.473> plans<00:41:59.876> to<00:41:59.956> go<00:42:00.117> public.

00:42:01.247 --> 00:42:03.251
Or<00:42:01.343> take<00:42:01.568> someone<00:42:01.904> internally<00:42:02.706> to<00:42:02.867> do<00:42:03.171> it.

00:42:03.348 --> 00:42:05.481
And<00:42:03.508> no<00:42:03.668> one<00:42:03.909> knew<00:42:04.069> the<00:42:04.150> business<00:42:04.551> better<00:42:04.791> than<00:42:05.112> Jeremy.

00:42:05.753 --> 00:42:10.693
In<00:42:05.850> fact,<00:42:07.100> he<00:42:07.277> probably<00:42:07.822> architected<00:42:08.480> nearly<00:42:08.865> every<00:42:09.121> business<00:42:09.522> process<00:42:10.003> in<00:42:10.083> that<00:42:10.308> company.

00:42:11.928 --> 00:42:18.150
He<00:42:12.072> worked<00:42:12.329> long<00:42:12.713> hours<00:42:13.291> and<00:42:13.419> was<00:42:13.531> an<00:42:13.628> incredible,<00:42:15.536> just<00:42:16.723> value<00:42:17.124> creator<00:42:17.525> for<00:42:17.653> that<00:42:17.781> business.

00:42:19.385 --> 00:42:22.288
So<00:42:19.545> he<00:42:20.107> becomes<00:42:20.492> the<00:42:20.524> CEO<00:42:20.973> about<00:42:21.133> 60<00:42:21.390> days<00:42:21.518> before<00:42:21.775> the<00:42:21.871> IPO.

00:42:22.352 --> 00:42:23.234
He<00:42:22.496> does<00:42:22.673> the<00:42:22.817> roadshow.

00:42:24.116 --> 00:42:26.249
Back<00:42:24.356> then,<00:42:24.677> you<00:42:24.757> know,<00:42:24.998> you<00:42:25.078> flew<00:42:25.319> into<00:42:25.479> different<00:42:25.784> cities.

00:42:26.345 --> 00:42:29.264
I<00:42:26.361> think<00:42:26.538> I<00:42:26.618> flew<00:42:26.826> up<00:42:26.922> to<00:42:26.955> San<00:42:27.227> Francisco<00:42:27.804> and<00:42:27.949> met<00:42:28.125> the<00:42:28.270> team<00:42:28.526> for<00:42:28.671> their<00:42:28.847> pitch<00:42:29.152> there.

00:42:29.328 --> 00:42:30.659
I<00:42:29.408> wanted<00:42:29.585> to<00:42:29.665> see<00:42:29.953> it<00:42:30.034> in<00:42:30.130> person.

00:42:32.028 --> 00:42:38.188
Jeremy<00:42:32.336> did<00:42:32.450> a<00:42:32.498> great<00:42:32.758> job<00:42:34.443> and<00:42:34.865> stayed<00:42:35.254> on<00:42:35.594> for<00:42:35.918> the<00:42:35.999> next<00:42:36.307> couple<00:42:36.632> of<00:42:36.713> years<00:42:37.377> as<00:42:37.475> a<00:42:37.539> public<00:42:37.864> company.

00:42:40.400 --> 00:42:40.448
Yeah.

00:42:40.496 --> 00:42:50.513
And<00:42:40.593> then<00:42:40.818> he<00:42:40.995> goes<00:42:41.301> on<00:42:42.348> to<00:42:43.008> build<00:42:43.411> Traeger<00:42:43.813> Grills,<00:42:44.296> which<00:42:44.473> is<00:42:44.844> this<00:42:45.262> incredible—<00:42:47.034> like<00:42:47.259> he<00:42:47.436> figured<00:42:47.823> out,<00:42:48.483> he<00:42:48.628> must<00:42:48.950> have<00:42:49.111> learned<00:42:49.353> some<00:42:49.514> lessons<00:42:49.820> at<00:42:49.949> Skullcandy.

00:42:50.900 --> 00:43:04.052
And<00:42:50.981> we've<00:42:51.142> talked<00:42:51.449> about<00:42:51.707> this<00:42:52.110> on<00:42:52.272> this<00:42:52.417> show<00:42:52.610> and<00:42:52.739> others<00:42:53.159> before<00:42:54.191> where<00:42:54.514> like<00:42:54.836> going<00:42:55.320> high-end,<00:42:56.814> starting<00:42:57.380> there,<00:42:58.900> building<00:42:59.239> a<00:42:59.304> brand<00:42:59.644> that<00:42:59.805> matters,<00:43:00.452> building<00:43:00.759> a<00:43:00.840> brand<00:43:01.099> that<00:43:01.245> people<00:43:01.503> care<00:43:01.746> about,<00:43:03.002> and<00:43:03.083> turning<00:43:03.422> it<00:43:03.487> into<00:43:03.713> Traeger.

00:43:04.439 --> 00:43:06.764
And<00:43:04.536> you<00:43:04.697> did<00:43:04.859> the<00:43:04.940> exact<00:43:05.279> same<00:43:05.505> thing<00:43:05.747> with,<00:43:06.053> with<00:43:06.215> Stance.

00:43:07.280 --> 00:43:12.923
At<00:43:07.426> what<00:43:07.587> point<00:43:07.845> did<00:43:08.007> you<00:43:08.249> start<00:43:08.652> thinking<00:43:09.072> about<00:43:10.186> Stance<00:43:11.300> and<00:43:11.623> that<00:43:12.112> as<00:43:12.277> a<00:43:12.360> category?

00:43:13.718 --> 00:43:14.744
Socks<00:43:14.181> is<00:43:14.297> a<00:43:14.363> category.

00:43:16.202 --> 00:43:27.766
Yeah,<00:43:16.427> I<00:43:16.443> think<00:43:16.685> we<00:43:16.830> would<00:43:16.990> always<00:43:17.312> ask<00:43:17.505> ourselves<00:43:18.133> at<00:43:18.165> Skullcandy<00:43:19.018> why<00:43:19.564> customers<00:43:20.128> were<00:43:20.224> buying<00:43:20.530> our<00:43:20.707> product,<00:43:21.189> like<00:43:21.431> what<00:43:21.575> is<00:43:21.752> motivating<00:43:22.396> this<00:43:22.621> consumer<00:43:23.361> to<00:43:23.616> pick<00:43:23.952> us<00:43:24.177> off<00:43:24.417> the<00:43:24.513> peg<00:43:24.818> hook,<00:43:25.475> take<00:43:25.811> money<00:43:26.100> out<00:43:26.212> of<00:43:26.276> their<00:43:26.500> wallet<00:43:26.981> and<00:43:27.221> buy<00:43:27.622> us.

00:43:28.904 --> 00:43:43.871
And,<00:43:29.465> you<00:43:29.561> know,<00:43:30.122> part<00:43:30.362> of<00:43:30.507> the<00:43:30.603> thinking<00:43:31.003> here,<00:43:31.340> I'm<00:43:31.548> sure<00:43:31.708> it's<00:43:31.869> not<00:43:32.125> perfectly<00:43:32.510> developed,<00:43:33.087> but<00:43:34.769> at<00:43:34.849> the<00:43:34.929> time<00:43:35.250> of<00:43:35.330> the<00:43:35.410> initial<00:43:35.811> investment<00:43:36.372> in<00:43:36.468> Skullcandy,<00:43:38.359> Rick<00:43:38.535> had<00:43:38.679> gone<00:43:38.872> down<00:43:39.096> to<00:43:39.176> the<00:43:39.272> CES<00:43:39.753> show,<00:43:40.362> comes<00:43:40.763> up<00:43:40.859> with<00:43:41.099> all<00:43:41.179> these<00:43:41.660> orders,<00:43:42.221> and<00:43:42.301> he's<00:43:42.461> like,<00:43:42.622> I<00:43:42.702> need<00:43:42.942> money<00:43:43.182> for<00:43:43.343> production.

00:43:43.920 --> 00:43:45.426
So<00:43:44.000> I'm<00:43:44.208> like,<00:43:44.368> send<00:43:44.689> me<00:43:44.849> the<00:43:44.945> POs.

00:43:46.147 --> 00:43:48.919
So<00:43:46.227> he<00:43:46.307> sends<00:43:46.644> me<00:43:46.772> the<00:43:46.868> POs<00:43:48.070> and<00:43:48.150> I<00:43:48.246> start<00:43:48.615> calling<00:43:48.855> them.

00:43:49.834 --> 00:43:54.330
And<00:43:49.979> one<00:43:50.075> of<00:43:50.140> the<00:43:50.236> POs<00:43:50.637> I<00:43:50.798> called<00:43:51.263> was<00:43:51.504> this<00:43:51.665> business<00:43:52.002> called<00:43:52.805> Sam<00:43:53.206> Goody<00:43:53.527> Musicland.

00:43:55.133 --> 00:43:56.097
And<00:43:55.213> they<00:43:55.358> were<00:43:55.518> this<00:43:55.759> retailer.

00:43:56.177 --> 00:43:57.750
They<00:43:56.321> had<00:43:56.434> over<00:43:56.562> 1,000<00:43:57.365> stores.

00:43:57.799 --> 00:43:59.147
They<00:43:57.927> were<00:43:57.959> in<00:43:58.104> every<00:43:58.280> mall<00:43:58.585> in<00:43:58.682> America.

00:43:59.228 --> 00:44:04.462
They<00:43:59.388> primarily<00:43:59.966> sold<00:44:00.592> compact<00:44:01.074> discs<00:44:01.475> and<00:44:01.636> cassette<00:44:02.037> tapes,<00:44:02.359> which<00:44:02.519> explains<00:44:02.985> why<00:44:03.145> they<00:44:03.242> no<00:44:03.467> longer<00:44:03.804> exist.

00:44:05.169 --> 00:44:12.041
But<00:44:05.409> they<00:44:05.554> had<00:44:05.730> this<00:44:05.971> section<00:44:06.373> in<00:44:06.453> the<00:44:06.533> store<00:44:06.935> where<00:44:07.079> they<00:44:07.192> sold<00:44:07.577> consumer<00:44:08.059> electronics,<00:44:09.327> headphones,<00:44:10.130> Sony<00:44:10.451> Walkman,<00:44:11.270> this<00:44:11.431> kind<00:44:11.816> of<00:44:11.912> thing.

00:44:13.020 --> 00:44:14.417
And<00:44:13.197> they<00:44:13.357> had<00:44:13.534> placed<00:44:13.855> an<00:44:14.144> order.

00:44:14.722 --> 00:44:16.694
For<00:44:14.834> like<00:44:15.091> $100,000<00:44:16.149> of<00:44:16.261> Skullcandy.

00:44:16.902 --> 00:44:17.704
And<00:44:16.966> I<00:44:17.046> couldn't<00:44:17.287> believe<00:44:17.607> it.

00:44:17.752 --> 00:44:19.419
Why<00:44:17.912> would<00:44:18.008> they<00:44:18.168> buy<00:44:18.329> from<00:44:18.489> this<00:44:18.713> upstart<00:44:19.050> company?

00:44:20.429 --> 00:44:21.471
So<00:44:20.557> I<00:44:20.637> called<00:44:20.958> the<00:44:21.054> buyer.

00:44:21.920 --> 00:44:25.590
He<00:44:22.016> mentioned<00:44:22.400> he<00:44:22.497> had<00:44:22.657> been<00:44:22.881> the<00:44:22.978> headphone<00:44:23.539> buyer<00:44:23.843> there<00:44:24.019> for<00:44:24.180> like<00:44:24.404> 15<00:44:24.821> or<00:44:24.901> 20<00:44:25.286> years.

00:44:26.184 --> 00:44:34.055
And<00:44:26.248> he<00:44:26.344> proceeded<00:44:26.825> to<00:44:26.921> tell<00:44:27.145> me<00:44:27.306> that<00:44:27.466> the<00:44:27.610> reason<00:44:27.931> he<00:44:28.011> was<00:44:28.187> bringing<00:44:28.524> it<00:44:28.652> in<00:44:28.845> is<00:44:28.989> that<00:44:29.149> Sony,<00:44:29.790> Bose,<00:44:30.031> and<00:44:30.175> Sennheiser<00:44:31.858> and<00:44:31.955> Panasonic<00:44:32.740> were<00:44:32.900> all<00:44:33.061> black<00:44:33.493> and<00:44:33.638> silver.

00:44:34.263 --> 00:44:35.930
They<00:44:34.359> were<00:44:34.439> in<00:44:34.584> the<00:44:34.616> same<00:44:34.984> cardboard<00:44:35.481> box.

00:44:36.283 --> 00:44:37.790
Their<00:44:36.443> positioning<00:44:37.068> was<00:44:37.229> all<00:44:37.341> the<00:44:37.421> same.

00:44:38.110 --> 00:44:40.771
The<00:44:38.142> positioning<00:44:38.671> was,<00:44:39.312> we<00:44:39.425> sound<00:44:39.809> better<00:44:40.130> than<00:44:40.290> the<00:44:40.370> next<00:44:40.675> guy.

00:44:41.798 --> 00:44:58.872
And,<00:44:42.199> uh,<00:44:42.937> and<00:44:43.098> then<00:44:44.205> he<00:44:44.301> said,<00:44:44.526> I<00:44:44.622> looked<00:44:44.831> at<00:44:44.863> this<00:44:45.040> Skullcandy<00:44:45.730> product<00:44:46.532> and<00:44:46.692> it's<00:44:46.933> in<00:44:47.110> pop<00:44:47.430> colors,<00:44:48.136> clear<00:44:48.457> packaging,<00:44:49.260> it<00:44:49.292> doesn't<00:44:49.516> say<00:44:49.902> anything<00:44:50.255> about<00:44:50.495> sound<00:44:50.880> quality,<00:44:51.282> it's<00:44:51.506> all<00:44:51.603> about<00:44:51.907> this<00:44:52.084> contrarian<00:44:52.902> irreverent<00:44:53.528> lifestyle,<00:44:55.053> and<00:44:55.149> it<00:44:55.277> just<00:44:55.518> felt<00:44:55.710> so<00:44:56.015> differentiated<00:44:56.994> from<00:44:57.363> all<00:44:57.684> the<00:44:57.845> other<00:44:58.021> products<00:44:58.406> I<00:44:58.486> was<00:44:58.583> looking<00:44:58.823> at.

00:44:59.000 --> 00:45:05.772
So<00:44:59.209> I<00:44:59.289> wanted<00:44:59.465> to<00:44:59.546> give<00:44:59.706> it<00:44:59.786> a<00:44:59.802> chance,<00:45:00.605> so<00:45:00.813> I<00:45:01.070> kicked<00:45:01.455> out<00:45:01.632> Panasonic<00:45:02.434> to<00:45:02.578> make<00:45:02.915> room<00:45:03.220> for<00:45:03.316> Skullcandy,<00:45:04.343> was<00:45:04.504> the<00:45:04.680> gist<00:45:05.001> of<00:45:05.066> the<00:45:05.146> conversation.

00:45:06.365 --> 00:45:22.381
And<00:45:06.526> that<00:45:06.847> became<00:45:07.152> such<00:45:07.408> an<00:45:07.473> impactful<00:45:08.837> conversation<00:45:09.640> for<00:45:09.737> my<00:45:09.897> entire<00:45:10.379> consumer<00:45:10.877> life<00:45:11.825> because<00:45:12.066> every<00:45:12.291> time<00:45:12.468> I<00:45:12.548> would<00:45:12.773> walk<00:45:13.030> into<00:45:13.416> a<00:45:13.512> Walmart<00:45:14.010> or<00:45:14.155> a<00:45:14.235> Target<00:45:14.878> and<00:45:15.023> I<00:45:15.119> would<00:45:15.199> just<00:45:15.376> stand<00:45:15.778> in<00:45:15.922> front<00:45:16.083> of<00:45:16.163> the<00:45:16.244> sunblock<00:45:16.967> aisle<00:45:18.252> or<00:45:18.413> name<00:45:18.654> the<00:45:18.798> aisle,<00:45:18.991> school<00:45:19.377> supplies,<00:45:20.244> luggage,<00:45:21.144> jewelry,<00:45:21.546> doesn't<00:45:21.723> really<00:45:21.947> matter.

00:45:23.377 --> 00:45:26.687
I<00:45:23.393> would<00:45:23.538> stand<00:45:23.875> there<00:45:24.759> and<00:45:24.904> I<00:45:24.984> would<00:45:25.225> try<00:45:25.466> and<00:45:25.563> size<00:45:26.045> everyone<00:45:26.510> up.

00:45:27.410 --> 00:45:29.933
Colors,<00:45:28.133> positioning,<00:45:29.161> pricing.

00:45:30.527 --> 00:45:34.849
How<00:45:30.704> are<00:45:30.929> all<00:45:31.106> these<00:45:31.347> guys<00:45:31.668> trying<00:45:31.909> to<00:45:31.989> attract<00:45:32.311> consumers<00:45:33.034> and<00:45:33.178> what<00:45:33.355> differentiates<00:45:34.078> one<00:45:34.319> from<00:45:34.480> another?

00:45:35.450 --> 00:45:40.831
And<00:45:35.596> inevitably,<00:45:36.181> nearly<00:45:36.653> every<00:45:36.897> mature<00:45:37.319> category<00:45:39.514> starts<00:45:39.839> to<00:45:39.985> look<00:45:40.099> homogenized.

00:45:41.650 --> 00:45:46.024
In<00:45:41.746> other<00:45:41.908> words,<00:45:42.101> you<00:45:42.166> walk<00:45:42.408> up<00:45:42.489> to<00:45:42.570> sunblock,<00:45:43.619> they're<00:45:43.764> all<00:45:43.942> fluorescent<00:45:44.507> bottles,<00:45:45.782> right?

00:45:46.266 --> 00:45:48.138
Like<00:45:46.686> they're<00:45:46.992> all<00:45:47.170> trying<00:45:47.412> to<00:45:47.493> grab<00:45:47.880> your<00:45:48.122> eye.

00:45:48.381 --> 00:45:52.319
And<00:45:48.526> then<00:45:48.687> you<00:45:48.784> look<00:45:48.945> a<00:45:49.010> little<00:45:49.252> closer<00:45:49.607> and<00:45:49.753> Neutrogena's<00:45:50.479> got<00:45:50.640> the<00:45:50.770> doctor-approved<00:45:51.754> message.

00:45:52.431 --> 00:45:56.949
And,<00:45:53.222> you<00:45:53.303> know,<00:45:53.948> Banana<00:45:54.432> Boat's<00:45:54.900> kind<00:45:55.062> of<00:45:55.142> got<00:45:55.320> this<00:45:55.546> fun<00:45:55.965> vibe<00:45:56.369> going.

00:45:57.079 --> 00:46:01.485
And,<00:45:57.821> you<00:45:57.918> know,<00:45:58.450> Hawaiian<00:45:58.950> Tropic<00:45:59.418> kind<00:45:59.676> of<00:45:59.741> has,<00:45:59.983> still<00:46:00.144> has<00:46:00.322> the<00:46:00.470> girl<00:46:00.731> in<00:46:00.895> the<00:46:00.977> bikini.

00:46:01.566 --> 00:46:04.628
And<00:46:01.697> you<00:46:01.730> start<00:46:02.041> to<00:46:02.139> see<00:46:02.516> like<00:46:03.007> all<00:46:03.171> the<00:46:03.269> different<00:46:03.662> positioning<00:46:04.251> elements.

00:46:05.217 --> 00:46:12.241
And<00:46:05.297> then<00:46:05.457> you<00:46:05.553> ask<00:46:05.778> yourself<00:46:06.115> the<00:46:06.195> question,<00:46:07.093> if<00:46:07.221> I<00:46:07.253> were<00:46:07.398> to<00:46:07.478> launch<00:46:07.799> a<00:46:07.863> sunblock<00:46:08.520> product<00:46:09.563> against<00:46:10.044> all<00:46:10.204> of<00:46:10.429> these,<00:46:10.990> how<00:46:11.311> would<00:46:11.471> I<00:46:11.551> differentiate?

00:46:12.834 --> 00:46:13.812
How<00:46:13.091> would<00:46:13.251> it<00:46:13.331> be<00:46:13.492> different?

00:46:14.213 --> 00:46:15.624
How<00:46:14.374> do<00:46:14.534> I<00:46:14.550> make<00:46:14.758> the<00:46:14.855> packaging<00:46:15.336> different?

00:46:15.673 --> 00:46:17.453
How<00:46:15.753> do<00:46:15.833> I<00:46:15.897> make<00:46:16.122> the<00:46:16.202> value<00:46:16.539> proposition<00:46:17.180> different?

00:46:17.902 --> 00:46:24.637
Can<00:46:18.062> I<00:46:18.142> completely<00:46:18.864> change<00:46:19.345> the<00:46:19.425> matrix<00:46:20.131> so<00:46:20.227> that<00:46:20.371> I<00:46:20.387> don't<00:46:20.612> even<00:46:20.868> fit<00:46:21.350> in<00:46:21.430> the<00:46:21.590> 2x2<00:46:22.071> matrix<00:46:22.697> that<00:46:22.793> McKinsey<00:46:23.274> has<00:46:23.498> drawn<00:46:23.851> for<00:46:24.140> this<00:46:24.380> group?

00:46:25.663 --> 00:46:31.582
And,<00:46:26.802> you<00:46:26.882> know,<00:46:27.508> if<00:46:27.668> you<00:46:27.828> have<00:46:28.245> that<00:46:28.566> genuine<00:46:29.047> differentiation,<00:46:29.993> you<00:46:30.090> probably<00:46:30.474> have<00:46:30.587> a<00:46:30.651> chance<00:46:31.036> its<00:46:31.132> success.

00:46:32.257 --> 00:46:37.414
So<00:46:32.482> that<00:46:32.819> led<00:46:33.076> to<00:46:33.221> this,<00:46:34.586> let's<00:46:34.891> look<00:46:35.084> at<00:46:35.309> other<00:46:35.550> categories<00:46:36.257> that<00:46:36.353> are<00:46:36.434> homogenized.

00:46:38.201 --> 00:46:40.225
Could<00:46:38.426> we<00:46:38.602> build<00:46:38.843> a<00:46:38.908> differentiated<00:46:39.630> product?

00:46:40.434 --> 00:46:44.466
And<00:46:40.594> more<00:46:40.707> importantly,<00:46:41.173> I<00:46:41.253> think<00:46:41.414> the<00:46:41.558> question<00:46:41.879> is,<00:46:42.442> yes,<00:46:42.683> you<00:46:42.779> probably<00:46:43.100> can<00:46:43.325> do<00:46:43.422> that<00:46:43.598> if<00:46:43.743> you're<00:46:43.888> creative<00:46:44.225> enough.

00:46:45.012 --> 00:46:49.189
It's<00:46:45.205> if<00:46:45.349> we<00:46:45.590> did<00:46:45.831> do<00:46:46.056> that<00:46:46.394> and<00:46:46.554> we<00:46:46.859> won,<00:46:47.920> would,<00:46:48.402> would<00:46:48.546> it<00:46:48.627> be<00:46:48.723> valuable?

00:46:50.410 --> 00:46:57.832
Like,<00:46:51.052> I<00:46:51.100> don't<00:46:51.293> know,<00:46:51.454> maybe<00:46:52.643> reinventing<00:46:53.157> school<00:46:53.462> supplies<00:46:54.040> is<00:46:54.185> kind<00:46:54.346> of<00:46:54.426> a<00:46:54.570> dumb<00:46:54.827> category<00:46:55.374> because<00:46:56.434> kids<00:46:56.675> are<00:46:56.707> moving<00:46:57.076> more<00:46:57.173> and<00:46:57.301> more<00:46:57.478> digital.

00:46:58.024 --> 00:47:00.865
They<00:46:58.683> don't<00:46:58.923> have<00:46:59.148> paper<00:46:59.341> and<00:46:59.485> pencils<00:46:59.950> like<00:47:00.127> they<00:47:00.352> used<00:47:00.608> to.

00:47:01.266 --> 00:47:02.695
It's<00:47:01.427> a<00:47:01.475> seasonal<00:47:02.117> business.

00:47:02.839 --> 00:47:09.756
Most<00:47:02.951> of<00:47:03.016> the<00:47:03.096> sales<00:47:03.417> probably<00:47:03.722> happen<00:47:03.962> in<00:47:04.043> the<00:47:04.123> month<00:47:04.315> of<00:47:04.460> August,<00:47:04.941> and<00:47:05.022> then<00:47:05.503> they're<00:47:05.663> crappy<00:47:06.049> for<00:47:06.177> the<00:47:06.289> rest<00:47:06.562> of<00:47:06.626> the<00:47:06.787> year,<00:47:07.509> probably<00:47:07.830> dead<00:47:08.135> in<00:47:08.231> June<00:47:08.472> and<00:47:08.552> July<00:47:08.937> when<00:47:09.114> school's<00:47:09.499> out.

00:47:10.157 --> 00:47:16.191
And<00:47:10.237> you<00:47:10.317> sort<00:47:10.542> of<00:47:10.574> like<00:47:10.799> look<00:47:10.943> at<00:47:10.975> the<00:47:11.104> whole<00:47:11.200> category,<00:47:11.922> paper<00:47:12.388> products,<00:47:13.447> not<00:47:13.671> sustainable,<00:47:14.634> low<00:47:14.795> gross<00:47:15.132> margin<00:47:15.549> structure.

00:47:17.058 --> 00:47:20.363
I<00:47:17.090> don't<00:47:17.218> know<00:47:17.378> how<00:47:17.619> big<00:47:17.780> the<00:47:17.860> business<00:47:18.325> is<00:47:18.598> or<00:47:18.727> how<00:47:18.887> easily<00:47:19.240> it<00:47:19.304> could<00:47:19.368> be<00:47:19.465> globalized.

00:47:21.134 --> 00:47:28.275
And<00:47:21.214> you're<00:47:21.310> like,<00:47:21.567> yeah,<00:47:21.808> even<00:47:22.016> if<00:47:22.113> we<00:47:22.353> did<00:47:22.819> reinvent<00:47:23.332> school<00:47:23.717> supplies,<00:47:24.375> I'm<00:47:24.664> not<00:47:24.841> sure<00:47:25.001> it's<00:47:25.162> a<00:47:25.242> valuable<00:47:25.723> enough<00:47:26.028> piece<00:47:26.221> of<00:47:26.349> territory<00:47:27.007> that<00:47:27.152> we<00:47:27.312> want<00:47:27.505> to<00:47:27.713> own<00:47:27.826> it<00:47:28.034> anyway.

00:47:29.109 --> 00:47:34.691
So<00:47:29.334> that<00:47:29.639> adds<00:47:29.831> that<00:47:30.040> second<00:47:30.441> dimension<00:47:31.018> of<00:47:31.403> even<00:47:31.579> if<00:47:31.740> you<00:47:31.884> could<00:47:32.205> do<00:47:32.462> it,<00:47:33.087> would<00:47:33.184> it<00:47:33.264> be<00:47:33.408> valuable,<00:47:34.387> right?

00:47:34.772 --> 00:47:39.568
Like,<00:47:35.092> would<00:47:35.429> barbecue<00:47:35.975> grills<00:47:36.392> be<00:47:36.536> a<00:47:36.552> valuable<00:47:37.178> place<00:47:37.739> if<00:47:37.899> you<00:47:37.996> could<00:47:38.236> reinvent<00:47:38.782> it<00:47:38.862> and<00:47:39.022> dominate<00:47:39.503> it?

00:47:40.386 --> 00:47:44.652
Would<00:47:40.819> socks<00:47:41.605> be<00:47:41.701> a<00:47:41.765> valuable<00:47:42.327> place<00:47:42.663> if<00:47:42.808> you<00:47:42.952> could<00:47:43.193> reinvent<00:47:43.706> it<00:47:43.931> and<00:47:44.091> dominate<00:47:44.588> it?

00:47:45.214 --> 00:47:46.577
Like,<00:47:45.390> how<00:47:45.535> big<00:47:45.711> are<00:47:45.839> these<00:47:46.080> markets?

00:47:46.722 --> 00:47:47.829
What<00:47:46.834> are<00:47:46.898> the<00:47:47.043> profit<00:47:47.460> pools?

00:47:48.406 --> 00:47:50.122
And<00:47:48.486> that's<00:47:48.679> kind<00:47:48.871> of<00:47:48.903> the<00:47:48.983> second<00:47:49.304> part<00:47:49.481> of<00:47:49.561> the<00:47:49.689> homework.

00:47:50.507 --> 00:47:56.202
But<00:47:50.652> with<00:47:50.828> that<00:47:51.053> in<00:47:51.165> mind,<00:47:51.710> we,<00:47:52.496> you<00:47:52.593> know,<00:47:52.753> Rick<00:47:52.929> and<00:47:53.074> I<00:47:53.234> would<00:47:53.379> travel<00:47:53.715> around<00:47:54.132> and<00:47:54.277> kind<00:47:54.501> of<00:47:54.533> size<00:47:55.079> up<00:47:55.464> every<00:47:55.865> product.

00:47:56.362 --> 00:47:58.030
We're<00:47:56.522> like,<00:47:56.907> oh,<00:47:57.228> we<00:47:57.260> should<00:47:57.549> do<00:47:57.709> golf.

00:47:58.110 --> 00:48:02.824
What<00:47:58.207> I<00:47:58.367> think<00:47:58.608> TravisMathew<00:47:59.490> became<00:48:00.551> We<00:48:00.698> conceived<00:48:01.123> of<00:48:01.221> that<00:48:01.434> whole<00:48:01.598> business<00:48:02.006> in<00:48:02.105> the<00:48:02.203> mid-2000s.

00:48:04.500 --> 00:48:07.801
You<00:48:04.564> know,<00:48:04.693> could<00:48:04.854> we<00:48:04.934> do<00:48:05.079> something<00:48:05.401> that<00:48:05.498> was<00:48:05.659> more<00:48:05.965> irreverent<00:48:06.545> and<00:48:06.625> fashionable<00:48:07.430> and<00:48:07.656> young?

00:48:09.604 --> 00:48:15.746
Our<00:48:09.829> version<00:48:10.152> would've<00:48:10.329> probably<00:48:10.570> been<00:48:10.731> more<00:48:10.908> aggressive<00:48:11.359> than<00:48:11.456> theirs,<00:48:11.858> but<00:48:12.969> you<00:48:13.002> know,<00:48:13.308> at<00:48:13.404> the<00:48:13.533> time<00:48:13.952> golf<00:48:14.194> felt<00:48:14.453> so<00:48:14.679> sterile<00:48:15.310> and<00:48:15.407> old.

00:48:16.927 --> 00:48:18.123
Could<00:48:17.088> you<00:48:17.250> reinvent<00:48:17.670> the<00:48:17.816> whole<00:48:17.994> thing?

00:48:18.317 --> 00:48:25.327
So<00:48:18.479> we<00:48:18.641> just<00:48:18.867> looked<00:48:19.029> at<00:48:19.109> so<00:48:19.303> many<00:48:19.514> product<00:48:19.772> categories<00:48:20.338> and<00:48:20.888> to<00:48:20.969> short<00:48:21.211> circuit<00:48:21.470> the<00:48:21.518> whole<00:48:21.858> thing,<00:48:22.521> we<00:48:22.586> were<00:48:22.747> over<00:48:23.071> in<00:48:23.232> China<00:48:23.556> visiting<00:48:23.897> some<00:48:24.124> headphone<00:48:24.612> factories.

00:48:26.074 --> 00:48:34.703
We<00:48:26.155> were<00:48:26.253> at<00:48:26.399> the<00:48:26.496> JW<00:48:27.049> Marriott<00:48:27.942> in<00:48:28.121> Shenzhen,<00:48:29.537> We're<00:48:29.794> eating<00:48:29.970> the<00:48:30.099> breakfast<00:48:30.516> buffet<00:48:30.997> there<00:48:31.398> and<00:48:31.623> Rick<00:48:31.815> is<00:48:32.024> like,<00:48:32.377> it's<00:48:32.666> socks,<00:48:33.628> it's<00:48:34.061> socks.

00:48:34.767 --> 00:48:37.078
And<00:48:34.832> he<00:48:34.928> starts<00:48:35.329> preaching<00:48:35.650> socks<00:48:36.051> for<00:48:36.211> the<00:48:36.276> entire<00:48:36.677> breakfast.

00:48:37.655 --> 00:48:39.388
That<00:48:37.816> was<00:48:37.912> in<00:48:38.056> May<00:48:38.297> of<00:48:38.457> 2009.

00:48:39.565 --> 00:48:44.362
We<00:48:39.661> incorporated<00:48:40.286> the<00:48:40.383> company<00:48:40.784> in<00:48:40.944> December<00:48:41.506> of<00:48:41.618> '09,<00:48:42.148> sold<00:48:42.372> our<00:48:42.533> first<00:48:42.773> pair<00:48:42.870> of<00:48:42.902> socks<00:48:43.271> in<00:48:43.575> August<00:48:43.896> of<00:48:44.057> '10.

00:48:44.891 --> 00:48:53.635
So<00:48:45.052> it<00:48:45.084> was<00:48:45.196> really<00:48:45.517> that<00:48:45.982> conversation<00:48:46.800> around,<00:48:48.549> we<00:48:48.710> looked<00:48:48.966> at<00:48:49.207> luggage<00:48:49.849> and<00:48:50.009> jewelry<00:48:50.811> and<00:48:51.116> perfume,<00:48:52.015> lots<00:48:52.207> of<00:48:52.255> these<00:48:52.480> high<00:48:52.592> margin<00:48:53.041> categories.

00:48:53.699 --> 00:48:57.114
And<00:48:53.747> we're<00:48:53.844> asking<00:48:54.148> ourselves,<00:48:54.902> How<00:48:55.127> easy<00:48:55.303> or<00:48:55.463> hard<00:48:55.768> would<00:48:55.880> it<00:48:55.944> be<00:48:56.040> to<00:48:56.120> sell<00:48:56.297> them<00:48:56.505> online?

00:48:57.210 --> 00:48:58.685
DTC<00:48:57.771> was<00:48:57.932> this<00:48:58.172> new<00:48:58.348> thing.

00:48:58.749 --> 00:49:00.240
We<00:48:58.813> were<00:48:58.845> already<00:48:59.230> thinking<00:48:59.550> about<00:48:59.871> that.

00:49:00.977 --> 00:49:03.766
Um,<00:49:01.698> and<00:49:01.939> socks<00:49:02.436> just<00:49:02.596> seemed<00:49:02.981> fun<00:49:03.333> and<00:49:03.477> easy.

00:49:04.744 --> 00:49:12.133
And<00:49:05.225> we<00:49:05.385> also<00:49:05.577> noted<00:49:05.962> that<00:49:06.122> like<00:49:06.747> every<00:49:07.228> inch<00:49:07.485> of<00:49:07.629> the<00:49:07.725> human<00:49:08.126> body<00:49:08.591> had<00:49:08.767> already<00:49:09.007> been<00:49:09.232> branded<00:49:10.193> in<00:49:10.290> apparel,<00:49:11.235> except<00:49:11.668> socks.

00:49:12.758 --> 00:49:17.999
Most<00:49:12.854> sock<00:49:13.095> companies<00:49:13.479> were<00:49:13.559> so<00:49:13.816> dumb,<00:49:14.136> they<00:49:14.297> put<00:49:14.441> their<00:49:14.617> logo<00:49:14.938> high<00:49:15.114> up<00:49:15.258> on<00:49:15.403> the<00:49:15.435> sock<00:49:15.900> because<00:49:16.220> the<00:49:16.300> embroidery<00:49:16.701> machine<00:49:17.086> wouldn't<00:49:17.262> go<00:49:17.390> any<00:49:17.663> lower.

00:49:18.320 --> 00:49:20.820
So<00:49:18.384> you<00:49:18.528> couldn't<00:49:18.769> get<00:49:18.945> it<00:49:19.089> on<00:49:19.185> the<00:49:19.346> ankle<00:49:19.746> anyway,<00:49:20.131> if<00:49:20.291> you<00:49:20.388> wanted.

00:49:21.654 --> 00:49:22.535
We<00:49:21.734> thought<00:49:21.894> that<00:49:22.055> was<00:49:22.231> dumb.

00:49:23.659 --> 00:49:32.329
And<00:49:23.756> so<00:49:23.916> we,<00:49:24.093> of<00:49:24.221> course,<00:49:24.478> redesigned<00:49:24.960> our<00:49:25.024> embroidery<00:49:25.602> tooling<00:49:26.003> to<00:49:26.084> accommodate<00:49:26.630> a<00:49:26.726> logo<00:49:26.983> lower<00:49:27.368> down<00:49:27.673> on<00:49:27.705> the<00:49:27.786> sock,<00:49:28.251> but<00:49:28.893> that<00:49:29.118> whole<00:49:29.536> line<00:49:29.777> of<00:49:29.857> thinking<00:49:30.403> led<00:49:30.595> to<00:49:31.286> this<00:49:31.446> new<00:49:31.607> product<00:49:31.864> category.

00:49:32.426 --> 00:49:33.550
Let's<00:49:32.667> go<00:49:32.811> after<00:49:33.052> socks.

00:49:34.577 --> 00:49:46.282
We<00:49:35.139> would<00:49:35.300> go<00:49:35.476> to<00:49:35.557> our<00:49:35.782> favorite<00:49:36.135> skateboard<00:49:36.649> and<00:49:36.697> snowboard<00:49:37.227> shops,<00:49:38.527> and<00:49:38.672> they<00:49:38.832> literally<00:49:39.394> had<00:49:39.715> branded<00:49:40.117> headphones,<00:49:40.614> branded<00:49:41.080> glasses,<00:49:41.738> branded<00:49:42.140> sunscreen,<00:49:42.926> branded<00:49:43.826> head-to-toe<00:49:44.468> apparel,<00:49:45.014> shoes,<00:49:45.528> skateboard<00:49:46.073> shoes.

00:49:46.716 --> 00:49:48.289
They<00:49:46.796> just<00:49:47.117> didn't<00:49:47.358> have<00:49:47.599> branded<00:49:47.936> socks.

00:49:48.979 --> 00:49:51.287
It<00:49:49.027> was<00:49:49.107> like<00:49:49.203> the<00:49:49.427> one<00:49:49.748> thing<00:49:49.924> that<00:49:50.165> channel<00:49:50.630> didn't<00:49:50.886> have.

00:49:52.072 --> 00:49:54.589
And<00:49:52.232> so<00:49:52.585> that<00:49:52.729> was<00:49:52.874> the<00:49:52.954> channel<00:49:53.354> we<00:49:53.387> knew<00:49:53.771> from<00:49:54.012> Skullcandy.

00:49:54.653 --> 00:49:56.288
It<00:49:54.733> was<00:49:54.957> where<00:49:55.070> Skullcandy<00:49:55.695> was<00:49:55.935> born.

00:49:57.041 --> 00:50:04.639
Um,<00:49:57.378> one<00:49:57.538> of<00:49:57.602> the<00:49:57.666> market<00:49:57.939> mechanics<00:49:58.420> we<00:49:58.484> always<00:49:58.676> talk<00:49:58.916> about<00:49:59.285> is<00:49:59.846> demand<00:50:00.423> is<00:50:00.728> created<00:50:01.225> at<00:50:01.369> the<00:50:01.401> specialty<00:50:02.026> level,<00:50:02.908> but<00:50:03.004> it's<00:50:03.212> fulfilled<00:50:03.725> at<00:50:03.853> the<00:50:03.933> mass<00:50:04.334> level.

00:50:05.376 --> 00:50:11.804
In<00:50:05.456> other<00:50:05.633> words,<00:50:06.194> you<00:50:06.274> could<00:50:06.418> just<00:50:06.594> buy<00:50:06.755> an<00:50:06.979> end<00:50:07.139> cap<00:50:07.396> at<00:50:07.476> Target,<00:50:08.117> but<00:50:08.197> if<00:50:08.293> no<00:50:08.422> one<00:50:08.582> knows<00:50:08.838> who<00:50:08.918> you<00:50:09.079> are<00:50:09.143> or<00:50:09.383> what<00:50:09.544> you<00:50:09.624> sell<00:50:09.960> or<00:50:10.024> how<00:50:10.185> you're<00:50:10.281> different,<00:50:10.762> it<00:50:10.906> won't<00:50:11.082> work<00:50:11.323> anyway.

00:50:12.445 --> 00:50:16.083
People<00:50:12.669> like<00:50:12.862> to<00:50:13.006> think,<00:50:13.390> oh,<00:50:13.503> they<00:50:13.631> have<00:50:13.727> so<00:50:13.951> much<00:50:14.128> traffic,<00:50:14.705> it'll<00:50:14.929> just<00:50:15.154> turn<00:50:15.346> into<00:50:15.570> a<00:50:15.651> big<00:50:15.891> deal.

00:50:16.917 --> 00:50:17.703
It<00:50:17.078> rarely<00:50:17.479> does.

00:50:18.441 --> 00:50:31.207
You<00:50:18.537> have<00:50:18.842> to<00:50:19.002> build<00:50:19.804> a<00:50:19.900> grassroots<00:50:20.846> groundswell<00:50:21.504> of<00:50:21.648> energy,<00:50:22.931> and<00:50:23.108> that<00:50:23.493> is<00:50:23.653> much<00:50:23.910> easier<00:50:24.230> at<00:50:24.375> the<00:50:24.407> specialty<00:50:25.032> level<00:50:25.353> because<00:50:25.834> the<00:50:25.914> local<00:50:26.219> skateboard<00:50:26.860> shop,<00:50:27.758> they<00:50:27.823> actually<00:50:28.159> know<00:50:28.384> every<00:50:28.625> product<00:50:28.977> in<00:50:29.106> their<00:50:29.218> store<00:50:29.763> and<00:50:29.908> they<00:50:30.004> can<00:50:30.148> talk<00:50:30.501> to<00:50:30.645> it<00:50:30.790> credibly.

00:50:32.073 --> 00:50:45.365
Even<00:50:32.249> the<00:50:32.329> fashion<00:50:32.874> door<00:50:33.532> like<00:50:33.756> Fred<00:50:34.029> Siegel<00:50:34.574> in<00:50:34.719> Los<00:50:34.959> Angeles,<00:50:35.873> if<00:50:36.002> they<00:50:36.178> bring<00:50:36.419> in<00:50:36.499> a<00:50:36.515> new<00:50:36.820> brand,<00:50:37.301> everyone<00:50:37.766> on<00:50:37.862> the<00:50:37.942> floor<00:50:38.824> knows<00:50:39.081> about<00:50:39.370> the<00:50:39.466> brand,<00:50:39.867> who<00:50:40.027> the<00:50:40.107> designer<00:50:40.669> is,<00:50:40.973> where<00:50:41.134> it<00:50:41.310> came<00:50:41.551> from,<00:50:42.192> And<00:50:42.256> when<00:50:42.352> a<00:50:42.432> customer<00:50:42.897> asks,<00:50:43.298> they<00:50:43.394> can<00:50:43.490> have<00:50:43.634> this<00:50:43.874> really<00:50:44.275> interesting<00:50:44.740> conversation.

00:50:46.102 --> 00:50:50.204
And<00:50:46.502> you<00:50:46.599> tend<00:50:46.839> to<00:50:46.919> lose<00:50:47.320> that<00:50:47.784> when<00:50:48.345> you're<00:50:48.586> in<00:50:48.746> a<00:50:49.082> big<00:50:49.307> box<00:50:49.563> environment.

00:50:50.621 --> 00:50:57.271
So<00:50:50.765> I<00:50:50.909> think<00:50:51.166> it<00:50:51.246> just<00:50:51.470> helps<00:50:52.047> build<00:50:52.271> a<00:50:52.367> brand<00:50:52.752> when<00:50:52.848> you<00:50:52.928> start<00:50:53.169> at<00:50:53.249> that<00:50:53.425> specialty<00:50:54.034> level,<00:50:54.354> assuming<00:50:54.835> you're<00:50:54.931> gonna<00:50:55.060> have<00:50:55.236> a<00:50:55.316> wholesale<00:50:55.652> business<00:50:56.053> and<00:50:56.133> not<00:50:56.293> just<00:50:56.534> be<00:50:56.694> DTC.

00:50:57.800 --> 00:51:00.636
But<00:50:57.896> it<00:50:57.960> does<00:50:58.216> illustrate<00:50:58.697> the<00:50:59.082> problem<00:50:59.434> and<00:50:59.562> the<00:50:59.642> challenge<00:50:59.995> of<00:51:00.123> DTC.

00:51:00.940 --> 00:51:05.844
You<00:51:01.021> still<00:51:01.245> have<00:51:01.357> to<00:51:01.485> tell<00:51:01.662> that<00:51:01.838> story<00:51:02.222> and<00:51:02.367> build<00:51:02.527> that<00:51:02.687> grassroots<00:51:03.184> energy,<00:51:03.649> even<00:51:03.841> if<00:51:03.969> it's<00:51:04.129> only<00:51:04.322> online,<00:51:05.668> you<00:51:05.764> know.

00:51:05.908 --> 00:51:17.847
And<00:51:06.052> I<00:51:06.148> think<00:51:06.325> some<00:51:06.485> of<00:51:06.549> the<00:51:06.693> local<00:51:06.950> businesses,<00:51:07.591> like<00:51:07.767> say<00:51:08.250> I<00:51:08.427> don't<00:51:08.686> want<00:51:08.831> to<00:51:08.912> use<00:51:09.171> names,<00:51:09.494> but<00:51:10.076> some<00:51:10.205> of<00:51:10.302> our<00:51:10.529> local<00:51:10.868> consumer<00:51:11.337> brands<00:51:11.757> that<00:51:11.838> started<00:51:12.242> DTC,<00:51:12.954> I<00:51:13.051> think,<00:51:13.212> have<00:51:13.374> learned<00:51:13.681> the<00:51:13.778> hard<00:51:14.101> way<00:51:14.893> that<00:51:14.990> it's<00:51:15.136> actually<00:51:15.799> very<00:51:16.122> hard<00:51:16.429> to<00:51:16.526> tell<00:51:16.704> a<00:51:16.833> brand<00:51:17.060> story<00:51:17.494> online.

00:51:18.763 --> 00:51:19.503
Really<00:51:19.085> hard<00:51:19.262> to<00:51:19.342> do.

00:51:20.387 --> 00:51:22.621
And<00:51:20.467> you<00:51:20.612> started<00:51:21.335> at<00:51:21.496> a<00:51:21.753> premium<00:51:22.219> price<00:51:22.477> point.

00:51:22.718 --> 00:51:27.676
I<00:51:22.782> remember<00:51:22.959> thinking,<00:51:23.280> man,<00:51:23.586> like<00:51:23.827> $15<00:51:24.550> socks<00:51:25.049> or<00:51:25.274> like<00:51:25.515> when<00:51:25.611> it<00:51:25.660> was—<00:51:25.789> I'm<00:51:26.031> on—<00:51:26.111> this<00:51:26.337> is<00:51:27.144> fascinating.

00:51:27.773 --> 00:51:28.596
Who's<00:51:27.967> going<00:51:28.047> to<00:51:28.112> buy<00:51:28.257> $15?

00:51:28.983 --> 00:51:36.278
Turns<00:51:29.225> out<00:51:29.564> everyone's<00:51:29.983> going<00:51:30.080> to<00:51:30.128> buy<00:51:30.370> $15<00:51:31.016> socks<00:51:31.887> that<00:51:32.210> are<00:51:33.839> interesting<00:51:34.404> looking,<00:51:34.791> have<00:51:34.952> some<00:51:35.114> sort<00:51:35.291> of<00:51:35.340> story<00:51:35.685> behind<00:51:36.031> them.

00:51:36.608 --> 00:51:37.975
And<00:51:36.756> then<00:51:36.937> the<00:51:37.102> deal<00:51:37.415> with<00:51:37.579> the<00:51:37.744> NBA.

00:51:39.133 --> 00:51:51.677
I<00:51:39.197> mean,<00:51:39.373> my<00:51:39.533> goodness,<00:51:39.934> Stance<00:51:40.414> being<00:51:40.639> the<00:51:40.735> official<00:51:41.135> stock,<00:51:42.096> the<00:51:42.177> sock<00:51:42.593> of<00:51:42.753> the<00:51:42.978> NBA<00:51:43.538> and<00:51:43.618> that<00:51:43.779> even<00:51:43.955> being<00:51:44.179> a<00:51:44.259> category<00:51:44.980> and<00:51:45.060> then<00:51:45.205> like<00:51:45.381> Nike<00:51:45.653> figuring<00:51:46.166> out<00:51:46.278> that<00:51:46.374> that's<00:51:46.582> a<00:51:46.646> category<00:51:47.127> and<00:51:47.223> they<00:51:47.367> have<00:51:47.544> to,<00:51:48.088> you<00:51:48.120> know,<00:51:48.265> start<00:51:48.585> getting<00:51:49.002> into<00:51:49.146> that<00:51:49.530> game<00:51:49.723> is,<00:51:50.187> is<00:51:50.283> so—<00:51:50.780> how<00:51:50.908> did<00:51:51.132> that<00:51:51.373> come<00:51:51.485> about?

00:51:51.773 --> 00:51:53.103
How<00:51:51.805> did<00:51:51.950> the<00:51:52.094> NBA<00:51:52.510> thing<00:51:52.735> come<00:51:52.927> about?

00:51:54.433 --> 00:51:59.768
Well,<00:51:54.577> we<00:51:54.657> had<00:51:54.753> a<00:51:54.833> little<00:51:55.010> bit<00:51:55.154> of<00:51:55.234> an<00:51:55.314> advantage<00:51:55.875> because<00:51:56.131> Skullcandy<00:51:56.772> made<00:51:57.461> licensed<00:51:58.038> headphones<00:51:58.678> for<00:51:58.823> all<00:51:58.919> the<00:51:59.063> NBA<00:51:59.480> teams.

00:52:00.377 --> 00:52:01.963
So<00:52:00.521> we<00:52:00.601> knew<00:52:00.761> a<00:52:00.841> little<00:52:01.066> bit<00:52:01.162> about<00:52:01.402> that<00:52:01.626> business.

00:52:02.043 --> 00:52:08.435
In<00:52:02.123> other<00:52:02.347> words,<00:52:02.604> we<00:52:02.700> knew<00:52:03.084> like<00:52:03.629> how<00:52:03.741> many<00:52:04.286> L.A.<00:52:04.590> Lakers<00:52:04.991> headphones<00:52:05.552> would<00:52:05.712> sell<00:52:06.192> relative<00:52:06.849> to<00:52:07.330> maybe<00:52:07.586> a<00:52:07.650> smaller<00:52:07.987> market.

00:52:09.158 --> 00:52:21.714
Um,<00:52:09.816> we<00:52:09.912> knew<00:52:10.057> some<00:52:10.234> of<00:52:10.298> those<00:52:10.539> things<00:52:10.940> and<00:52:11.325> Clark<00:52:11.646> Miyasaki,<00:52:12.449> who<00:52:13.413> worked<00:52:13.670> with<00:52:13.894> me<00:52:14.071> at<00:52:14.456> V<00:52:14.633> Spring,<00:52:15.741> joined<00:52:16.222> me<00:52:16.383> at<00:52:16.544> Logo<00:52:16.945> Works,<00:52:18.149> then<00:52:18.390> joined<00:52:18.872> me<00:52:18.984> at<00:52:19.113> Skullcandy,<00:52:20.236> then<00:52:20.493> joined<00:52:20.911> me<00:52:21.055> at<00:52:21.200> Stance.

00:52:21.778 --> 00:52:24.411
Like<00:52:22.244> we've<00:52:22.420> worked<00:52:22.661> together<00:52:23.062> almost<00:52:23.319> our<00:52:23.464> entire<00:52:23.929> career.

00:52:25.069 --> 00:52:34.205
He's<00:52:25.535> really<00:52:26.177> strategic<00:52:26.836> about<00:52:27.092> thinking<00:52:28.746> what<00:52:28.987> kinds<00:52:29.260> of<00:52:29.324> business<00:52:29.629> development<00:52:30.111> channels<00:52:30.593> would<00:52:30.689> increase<00:52:31.171> awareness<00:52:31.733> for<00:52:31.877> a<00:52:31.973> brand<00:52:32.471> and<00:52:32.600> how<00:52:32.712> much<00:52:33.017> does<00:52:33.178> it<00:52:33.258> cost<00:52:33.515> to<00:52:33.724> access<00:52:34.141> that.

00:52:35.087 --> 00:52:48.552
And<00:52:35.183> we<00:52:35.408> really<00:52:35.664> thought<00:52:35.889> the<00:52:35.985> marketing<00:52:36.546> value<00:52:36.931> of<00:52:37.027> an<00:52:37.107> NBA<00:52:37.411> agreement<00:52:37.828> was<00:52:37.988> almost<00:52:38.293> more<00:52:38.405> important<00:52:38.950> than<00:52:39.191> the<00:52:39.271> sales,<00:52:40.313> because<00:52:40.457> you<00:52:40.489> have<00:52:40.633> all<00:52:40.730> these<00:52:40.954> fans<00:52:41.355> come<00:52:41.740> in<00:52:41.772> to<00:52:41.916> get<00:52:42.060> exposed<00:52:42.637> to<00:52:42.862> you,<00:52:43.423> your<00:52:43.663> logos<00:52:44.160> in<00:52:44.385> NBA<00:52:44.946> 2K,<00:52:46.308> you<00:52:46.388> know,<00:52:46.709> every<00:52:47.110> home<00:52:47.430> gamer<00:52:47.783> is<00:52:47.927> seeing<00:52:48.392> it.

00:52:49.274 --> 00:53:02.723
And<00:52:49.610> so<00:52:50.107> he<00:52:50.252> had<00:52:50.396> initially<00:52:50.813> done<00:52:51.037> this<00:52:51.213> project<00:52:51.919> where<00:52:52.239> he<00:52:52.335> looked<00:52:52.592> at<00:52:52.720> all<00:52:52.816> the<00:52:52.897> different<00:52:53.281> athletes<00:52:53.778> we<00:52:53.922> could<00:52:54.035> sponsor,<00:52:54.660> looked<00:52:54.836> at<00:52:54.900> the<00:52:54.980> value<00:52:55.365> of<00:52:55.525> the<00:52:55.638> leagues,<00:52:56.183> looked<00:52:56.359> at<00:52:56.503> the<00:52:56.583> value<00:52:57.000> of<00:52:57.145> people<00:52:57.449> like<00:52:57.722> a<00:52:57.850> Will<00:52:58.026> Smith<00:52:58.667> or<00:52:58.892> Rihanna,<00:52:59.950> you<00:52:59.982> know,<00:53:00.110> what<00:53:00.270> would<00:53:00.495> that<00:53:00.767> give<00:53:01.056> you<00:53:01.232> if<00:53:01.393> they<00:53:01.537> were<00:53:01.633> behind<00:53:02.098> your<00:53:02.258> brand?

00:53:03.300 --> 00:53:09.126
And<00:53:03.476> you<00:53:03.557> can<00:53:03.781> use<00:53:03.957> surrogates<00:53:04.583> like<00:53:04.759> their<00:53:04.839> social<00:53:05.304> media<00:53:05.641> presence,<00:53:06.282> or<00:53:06.346> how<00:53:06.443> many<00:53:06.748> jerseys<00:53:07.230> they<00:53:07.342> sell<00:53:07.808> or<00:53:07.969> what<00:53:08.194> markets<00:53:08.692> they're<00:53:08.917> in.

00:53:09.255 --> 00:53:16.244
And<00:53:09.897> pretty<00:53:10.138> quickly,<00:53:10.620> we<00:53:10.781> realized<00:53:11.327> the<00:53:11.488> NBA<00:53:11.986> could<00:53:12.227> be<00:53:13.497> one<00:53:13.738> of,<00:53:14.075> if<00:53:14.236> not<00:53:14.412> the<00:53:14.557> best<00:53:14.798> partner<00:53:15.280> we<00:53:15.425> could<00:53:15.585> hope<00:53:15.762> to<00:53:15.907> have.

00:53:16.421 --> 00:53:21.691
I<00:53:16.646> think<00:53:16.887> the<00:53:17.032> NBA<00:53:17.273> is<00:53:17.433> also<00:53:17.674> special<00:53:18.172> because<00:53:18.510> it's<00:53:18.670> sports,<00:53:20.502> but<00:53:20.663> it's<00:53:20.888> also<00:53:21.225> culture.

00:53:22.414 --> 00:53:22.736
Yeah.

00:53:23.137 --> 00:53:30.963
You<00:53:23.170> know,<00:53:23.314> people<00:53:23.619> like<00:53:23.941> Allen<00:53:24.262> Iverson,<00:53:25.082> like,<00:53:25.307> completely<00:53:26.046> reinvented<00:53:26.705> a<00:53:26.833> culture<00:53:27.476> inside<00:53:27.910> of<00:53:28.054> the<00:53:28.135> game<00:53:28.311> of<00:53:28.376> basketball<00:53:30.464> that<00:53:30.641> spread.

00:53:31.027 --> 00:53:40.935
So<00:53:31.589> I<00:53:31.670> think<00:53:31.830> the<00:53:32.713> not<00:53:32.937> that<00:53:33.049> the<00:53:33.338> other<00:53:33.674> leagues<00:53:35.021> are<00:53:35.117> not<00:53:35.501> also<00:53:35.822> very<00:53:36.078> powerful<00:53:36.704> for<00:53:36.864> a<00:53:36.960> brand,<00:53:37.521> but<00:53:37.681> they<00:53:37.922> don't<00:53:38.242> have<00:53:38.627> the<00:53:38.723> cultural<00:53:39.348> element<00:53:39.829> that<00:53:39.989> the<00:53:40.150> NBA<00:53:40.631> has.

00:53:41.448 --> 00:53:50.360
It<00:53:41.528> kind<00:53:41.753> of<00:53:41.849> wraps<00:53:42.314> up<00:53:43.067> so<00:53:43.371> many<00:53:43.916> elements<00:53:44.429> of<00:53:44.574> popular<00:53:45.054> culture<00:53:46.817> in<00:53:46.994> it,<00:53:47.619> and<00:53:47.763> I<00:53:47.859> think<00:53:48.020> that<00:53:48.244> can<00:53:48.420> benefit<00:53:48.805> a<00:53:48.885> brand<00:53:49.526> if<00:53:49.622> done<00:53:49.847> the<00:53:49.927> right<00:53:50.167> way.

00:53:50.744 --> 00:54:00.329
So<00:53:51.770> we<00:53:51.931> ended<00:53:52.171> up,<00:53:52.732> you<00:53:52.764> know,<00:53:52.892> having<00:53:53.149> lots<00:53:53.373> of<00:53:53.453> conversations<00:53:54.094> with<00:53:54.191> the<00:53:54.351> NBA,<00:53:55.617> all<00:53:55.777> the<00:53:55.873> details,<00:53:56.579> some<00:53:56.755> of<00:53:56.899> which<00:53:57.092> are<00:53:57.156> probably<00:53:57.476> still<00:53:57.717> confidential,<00:53:58.438> but<00:53:58.598> they<00:53:58.823> had<00:53:58.983> an<00:53:59.079> existing<00:53:59.560> deal<00:53:59.784> with<00:53:59.897> Adidas.

00:54:00.906 --> 00:54:08.373
But<00:54:01.002> Adidas<00:54:01.403> had<00:54:01.563> never<00:54:01.804> done<00:54:02.028> anything<00:54:02.428> with<00:54:02.589> the<00:54:02.669> socks,<00:54:03.166> so<00:54:03.406> they<00:54:03.486> had<00:54:03.646> continued<00:54:04.079> to<00:54:04.271> use<00:54:04.592> the<00:54:04.928> NBA<00:54:05.329> Jumpman<00:54:05.873> logo<00:54:06.146> sock,<00:54:06.530> which<00:54:06.691> was<00:54:06.835> just<00:54:06.995> a<00:54:07.011> very<00:54:07.332> plain<00:54:07.716> cotton<00:54:08.053> sock.

00:54:08.934 --> 00:54:16.705
So<00:54:09.078> it<00:54:09.158> wasn't<00:54:09.479> hard<00:54:09.799> to<00:54:09.975> engineer<00:54:10.520> a<00:54:10.552> much<00:54:11.017> better<00:54:11.337> product<00:54:12.283> that<00:54:12.363> had<00:54:12.539> better<00:54:12.844> padding,<00:54:13.485> better<00:54:13.981> ventilation,<00:54:15.199> fit<00:54:15.584> better,<00:54:16.208> all<00:54:16.305> of<00:54:16.385> that.

00:54:17.250 --> 00:54:24.509
So<00:54:17.362> we<00:54:17.506> did<00:54:17.731> that,<00:54:18.051> we<00:54:18.147> brought<00:54:18.243> it<00:54:18.308> to<00:54:18.388> the<00:54:18.532> NBA,<00:54:19.029> but<00:54:19.109> they<00:54:19.253> were<00:54:19.349> kind<00:54:19.525> of<00:54:19.573> like,<00:54:19.750> I<00:54:19.830> don't<00:54:19.990> know<00:54:20.150> what<00:54:20.391> Adidas'<00:54:21.352> response<00:54:21.977> would<00:54:22.153> be<00:54:22.394> if<00:54:22.554> we<00:54:22.874> put<00:54:23.195> an<00:54:23.339> actual<00:54:23.595> different<00:54:23.900> brand<00:54:24.300> on<00:54:24.396> there.

00:54:25.117 --> 00:54:27.793
The<00:54:25.198> only<00:54:25.422> brand<00:54:25.742> on<00:54:25.839> the<00:54:25.983> court<00:54:26.175> at<00:54:26.303> the<00:54:26.383> time<00:54:26.720> was<00:54:26.832> Spalding<00:54:27.425> with<00:54:27.585> the<00:54:27.681> ball.

00:54:28.885 --> 00:54:30.668
They<00:54:28.966> had<00:54:29.126> never<00:54:29.528> done<00:54:29.769> co-branded<00:54:30.331> deals.

00:54:30.732 --> 00:54:32.627
There<00:54:30.812> were<00:54:30.909> no<00:54:31.053> sponsor<00:54:31.599> logos<00:54:31.953> on<00:54:32.097> jerseys.

00:54:33.783 --> 00:54:39.372
So<00:54:33.864> it<00:54:33.928> was<00:54:34.024> kind<00:54:34.185> of<00:54:34.265> a<00:54:34.410> big<00:54:34.586> deal<00:54:34.827> to<00:54:34.908> be<00:54:35.052> like,<00:54:35.373> we're<00:54:35.534> gonna<00:54:35.711> put<00:54:35.871> a<00:54:36.032> branded<00:54:36.995> logo<00:54:37.622> on<00:54:37.879> every<00:54:38.200> NBA<00:54:38.441> player's<00:54:39.003> ankle.

00:54:39.485 --> 00:54:40.400
Like,<00:54:39.661> are<00:54:39.742> we<00:54:39.886> okay<00:54:40.127> with<00:54:40.272> that?

00:54:41.508 --> 00:54:46.471
So<00:54:41.797> luckily<00:54:42.697> we<00:54:43.098> had<00:54:43.259> an<00:54:43.339> early<00:54:43.644> angel<00:54:43.901> investor,<00:54:44.849> a<00:54:44.929> guy<00:54:45.025> named<00:54:45.266> Mike<00:54:45.587> Levine<00:54:46.230> from<00:54:46.423> CAA.

00:54:46.615 --> 00:54:50.405
He's<00:54:47.258> the<00:54:47.354> president<00:54:47.740> of<00:54:47.868> CAA<00:54:48.318> Sports,<00:54:48.799> largest<00:54:49.105> sports<00:54:49.442> agency<00:54:49.779> in<00:54:49.908> the<00:54:50.004> world.

00:54:50.807 --> 00:54:51.867
He<00:54:50.871> was<00:54:50.984> one<00:54:51.112> of<00:54:51.144> our<00:54:51.208> early<00:54:51.530> angels.

00:54:51.931 --> 00:54:54.645
He<00:54:52.092> called<00:54:52.333> the<00:54:52.413> commissioner,<00:54:53.537> gave<00:54:53.714> us<00:54:53.778> some<00:54:54.083> air<00:54:54.260> cover.

00:54:55.206 --> 00:54:57.353
Helped<00:54:55.623> get<00:54:55.927> the<00:54:56.007> whole<00:54:56.280> deal<00:54:56.648> lubricated.

00:54:57.930 --> 00:54:59.436
We<00:54:58.090> ended<00:54:58.331> up<00:54:58.507> at<00:54:58.571> an<00:54:58.667> All-Star<00:54:59.148> Game.

00:54:59.484 --> 00:55:00.798
I<00:54:59.548> think<00:54:59.789> it<00:54:59.853> was<00:55:00.013> in<00:55:00.189> Houston.

00:55:01.391 --> 00:55:06.999
And<00:55:01.471> I<00:55:01.551> remember<00:55:02.112> Clark<00:55:02.657> brought<00:55:02.833> a<00:55:02.977> check<00:55:03.330> for<00:55:03.698> $1<00:55:03.938> million<00:55:04.996> as<00:55:05.156> like<00:55:05.397> the<00:55:05.477> minimum<00:55:05.909> royalty<00:55:06.358> guarantee.

00:55:07.383 --> 00:55:16.740
And<00:55:07.624> in<00:55:07.784> the<00:55:07.848> meeting,<00:55:08.281> slid<00:55:08.617> it<00:55:08.745> across<00:55:09.963> to<00:55:10.107> the<00:55:10.267> NBA<00:55:10.588> licensing<00:55:11.245> team<00:55:12.366> and<00:55:12.446> was<00:55:12.607> like,<00:55:13.872> here's<00:55:14.145> a<00:55:14.273> down<00:55:14.593> payment<00:55:15.170> on<00:55:15.314> how<00:55:15.427> many<00:55:15.667> socks<00:55:16.116> we're<00:55:16.276> gonna<00:55:16.452> sell.

00:55:18.199 --> 00:55:23.037
And<00:55:18.439> they<00:55:18.599> were<00:55:18.695> kind<00:55:18.839> of<00:55:18.871> like,<00:55:20.201> I<00:55:20.233> don't<00:55:20.442> think<00:55:20.538> they<00:55:20.698> were<00:55:20.778> thinking<00:55:21.339> that<00:55:21.483> the<00:55:21.563> category<00:55:22.044> could<00:55:22.220> be<00:55:22.445> that<00:55:22.701> big.

00:55:24.704 --> 00:55:38.923
And<00:55:24.865> we,<00:55:25.025> of<00:55:25.169> course,<00:55:25.490> were,<00:55:26.051> and<00:55:26.548> I<00:55:26.708> think<00:55:26.949> that<00:55:27.253> was<00:55:27.349> such<00:55:27.510> an<00:55:27.814> over-the-top<00:55:28.792> signal<00:55:29.353> to<00:55:29.513> them<00:55:30.395> that<00:55:30.491> a<00:55:30.555> combination<00:55:31.261> of<00:55:31.421> us<00:55:31.661> working<00:55:31.998> behind<00:55:32.319> the<00:55:32.383> scenes,<00:55:33.184> working<00:55:33.521> with<00:55:33.681> the<00:55:33.825> team,<00:55:34.787> they<00:55:34.883> ultimately<00:55:35.300> said,<00:55:35.525> yeah,<00:55:35.749> we'll<00:55:35.845> do<00:55:36.005> a<00:55:36.150> 2-year<00:55:36.566> deal<00:55:36.887> because<00:55:37.128> there's<00:55:37.352> 2<00:55:37.512> years<00:55:37.753> left<00:55:38.009> on<00:55:38.089> this<00:55:38.266> Adidas<00:55:38.731> deal.

00:55:39.676 --> 00:55:41.985
At<00:55:39.772> that<00:55:39.933> point,<00:55:40.237> we're<00:55:40.334> going<00:55:40.430> to<00:55:40.494> put<00:55:40.654> the<00:55:40.702> whole<00:55:41.039> jersey<00:55:41.375> up<00:55:41.536> for<00:55:41.696> bid.

00:55:42.257 --> 00:55:49.871
Nike<00:55:42.642> ultimately<00:55:43.139> paid<00:55:43.267> $1<00:55:43.379> billion<00:55:43.764> and<00:55:44.261> took<00:55:44.485> the<00:55:44.565> whole<00:55:44.726> thing<00:55:44.902> head<00:55:45.062> to<00:55:45.223> toe,<00:55:45.543> but<00:55:46.104> for<00:55:46.200> those<00:55:46.505> 2<00:55:46.729> years,<00:55:47.547> we<00:55:47.627> were<00:55:47.771> able<00:55:47.948> to<00:55:48.028> put<00:55:48.188> Stance<00:55:48.621> socks<00:55:48.845> on<00:55:48.990> every<00:55:49.294> NBA<00:55:49.647> player.

00:55:50.593 --> 00:55:58.355
And<00:55:50.673> from<00:55:50.850> a<00:55:50.994> brand<00:55:51.299> awareness<00:55:51.716> perspective,<00:55:52.534> if<00:55:52.678> you<00:55:52.774> think<00:55:53.223> every<00:55:53.624> game,<00:55:53.945> every<00:55:54.266> replayed<00:55:54.763> game,<00:55:55.869> and<00:55:55.950> just<00:55:56.110> the<00:55:56.206> exposure<00:55:56.623> to<00:55:56.752> the<00:55:57.072> athletes,<00:55:58.131> right?

00:55:58.452 --> 00:56:12.084
Inside<00:55:58.853> the<00:55:58.997> All-Star<00:55:59.414> Game,<00:56:00.216> Clark<00:56:00.617> is<00:56:00.761> in<00:56:00.857> the<00:56:00.938> locker<00:56:01.419> room<00:56:02.445> at<00:56:02.622> halftime<00:56:03.343> or<00:56:03.423> before<00:56:03.808> the<00:56:03.905> game,<00:56:04.771> and<00:56:04.851> he's<00:56:05.027> done<00:56:05.188> these<00:56:05.428> custom<00:56:05.909> boxes<00:56:06.471> with<00:56:06.631> the<00:56:06.856> All-Star<00:56:07.273> Game<00:56:07.529> socks,<00:56:08.074> and<00:56:08.155> he's<00:56:08.315> like<00:56:08.556> handing<00:56:08.957> them<00:56:09.117> out<00:56:09.358> to<00:56:09.518> every<00:56:09.823> player<00:56:10.641> and<00:56:10.737> explaining<00:56:11.443> why<00:56:11.603> they're<00:56:11.843> better.

00:56:13.046 --> 00:56:15.628
And<00:56:13.127> you<00:56:13.207> can<00:56:13.367> imagine<00:56:13.768> like<00:56:13.993> all<00:56:14.089> the<00:56:14.249> NBA<00:56:14.554> players<00:56:14.955> putting<00:56:15.115> your<00:56:15.211> product<00:56:15.596> on.

00:56:15.693 --> 00:56:17.152
It<00:56:15.741> was<00:56:15.917> kind<00:56:16.078> of<00:56:16.174> a<00:56:16.254> fantasy<00:56:16.751> moment.

00:56:17.216 --> 00:56:19.317
Like<00:56:17.537> what<00:56:17.697> an<00:56:17.778> incredible<00:56:18.483> part<00:56:18.740> of<00:56:18.820> the<00:56:18.884> story.

00:56:20.744 --> 00:56:26.774
We<00:56:20.905> still<00:56:21.225> do<00:56:21.386> the<00:56:21.482> NBA<00:56:21.931> licensed<00:56:22.572> product,<00:56:24.112> but<00:56:24.336> Nike<00:56:24.609> now<00:56:24.897> has<00:56:25.090> the<00:56:25.218> on-court<00:56:25.651> sock<00:56:25.972> deal,<00:56:26.260> which<00:56:26.421> was<00:56:26.517> sad.

00:56:26.902 --> 00:56:42.841
We<00:56:26.982> just<00:56:27.078> couldn't<00:56:27.319> compete<00:56:27.639> with<00:56:27.784> them<00:56:28.024> on<00:56:28.121> a,<00:56:28.826> on<00:56:28.906> a<00:56:28.986> price<00:56:29.323> basis,<00:56:30.927> but<00:56:31.103> it<00:56:31.231> was<00:56:31.472> a<00:56:32.049> fantastic<00:56:32.771> breakthrough<00:56:33.268> for<00:56:33.492> the<00:56:33.572> brand<00:56:34.679> at<00:56:34.839> the<00:56:34.919> time,<00:56:35.400> and<00:56:35.994> I<00:56:36.138> think<00:56:36.363> it<00:56:36.395> was<00:56:36.603> also<00:56:36.844> our<00:56:36.940> first<00:56:37.244> performance<00:56:37.822> product,<00:56:38.928> and<00:56:39.024> I<00:56:39.105> think<00:56:39.265> there's<00:56:39.489> always<00:56:39.682> a<00:56:39.746> question<00:56:40.291> when<00:56:40.452> you<00:56:40.484> start<00:56:40.788> getting<00:56:41.029> into<00:56:41.430> running<00:56:41.991> or<00:56:42.312> biking.

00:56:43.659 --> 00:56:48.906
Now<00:56:43.995> the<00:56:44.156> true<00:56:44.380> athletes<00:56:44.877> look<00:56:45.038> at<00:56:45.118> this<00:56:45.358> as<00:56:45.519> a<00:56:45.679> piece<00:56:46.000> of<00:56:46.336> equipment,<00:56:47.187> not<00:56:47.428> as<00:56:48.006> a<00:56:48.151> fashion<00:56:48.569> item.

00:56:49.613 --> 00:56:55.767
So<00:56:50.031> the<00:56:50.111> substance<00:56:50.979> of<00:56:51.155> the<00:56:51.284> way<00:56:51.541> the<00:56:51.637> sock<00:56:52.023> is<00:56:52.248> built<00:56:52.393> and<00:56:52.730> what<00:56:52.842> it's<00:56:53.051> built<00:56:53.308> out<00:56:53.614> of<00:56:53.790> really<00:56:53.967> matters<00:56:54.754> in<00:56:54.899> those<00:56:55.140> use<00:56:55.317> cases.

00:56:56.682 --> 00:57:01.808
And<00:56:56.763> we<00:56:56.843> didn't<00:56:57.068> have<00:56:57.164> any<00:56:57.325> credibility<00:56:57.952> on<00:56:58.032> the<00:56:58.128> performance<00:56:58.610> side,<00:56:59.173> but<00:56:59.317> all<00:56:59.494> of<00:56:59.591> a<00:56:59.655> sudden<00:57:00.121> LeBron<00:57:00.522> James<00:57:00.779> is<00:57:00.940> wearing<00:57:01.326> the<00:57:01.358> sock.

00:57:02.531 --> 00:57:05.648
Like,<00:57:02.852> that's<00:57:03.414> all<00:57:03.495> the<00:57:03.591> validation<00:57:04.073> you<00:57:04.170> need,<00:57:04.780> which<00:57:04.941> is<00:57:04.973> another<00:57:05.278> great<00:57:05.455> story.

00:57:05.696 --> 00:57:06.531
I'll<00:57:05.841> tell<00:57:05.905> you<00:57:06.001> quickly.

00:57:07.528 --> 00:57:10.902
We<00:57:07.608> get<00:57:07.704> a<00:57:07.769> call<00:57:07.929> from<00:57:08.154> the<00:57:08.251> NBA<00:57:08.717> 2<00:57:08.893> days<00:57:09.279> before<00:57:09.616> the<00:57:09.713> season<00:57:10.098> is<00:57:10.259> going<00:57:10.484> to<00:57:10.564> start.

00:57:11.368 --> 00:57:13.199
And<00:57:11.448> they're<00:57:11.609> like,<00:57:12.171> guys,<00:57:12.589> we<00:57:12.733> have<00:57:12.846> a<00:57:12.910> problem.

00:57:13.953 --> 00:57:17.606
LeBron<00:57:14.497> has<00:57:14.674> tried<00:57:15.058> the<00:57:15.138> socks<00:57:15.491> in<00:57:15.555> practice<00:57:16.757> and<00:57:16.821> he<00:57:16.981> won't<00:57:17.221> wear<00:57:17.462> them.

00:57:18.728 --> 00:57:25.602
He's<00:57:18.824> been<00:57:18.904> wearing<00:57:19.160> the<00:57:19.224> same<00:57:19.497> sock<00:57:19.978> since<00:57:20.266> he<00:57:20.362> was<00:57:20.667> in<00:57:20.843> middle<00:57:21.067> school,<00:57:22.205> and<00:57:22.285> they're<00:57:22.429> manufactured<00:57:23.086> by<00:57:23.246> this<00:57:23.471> little<00:57:23.663> sock<00:57:23.967> company<00:57:24.368> up<00:57:24.544> in<00:57:24.993> Minneapolis.

00:57:26.467 --> 00:57:27.509
It's<00:57:26.611> an<00:57:26.756> all-cotton<00:57:27.188> sock.

00:57:27.557 --> 00:57:30.906
So<00:57:27.733> we<00:57:27.829> immediately<00:57:28.390> somehow<00:57:29.496> get<00:57:29.720> a<00:57:29.736> couple<00:57:30.057> pairs<00:57:30.377> of<00:57:30.441> these<00:57:30.682> things.

00:57:31.963 --> 00:57:44.386
We<00:57:32.060> go<00:57:32.300> get<00:57:32.460> a<00:57:32.556> spool<00:57:33.005> of<00:57:33.101> cotton,<00:57:34.367> we<00:57:34.527> load<00:57:34.768> up<00:57:34.960> the<00:57:35.120> knitting<00:57:35.505> machines,<00:57:36.226> and<00:57:36.386> we<00:57:36.482> make<00:57:37.251> NBA<00:57:38.165> Cleveland<00:57:39.014> Cavaliers<00:57:39.447> socks<00:57:40.934> just<00:57:41.113> straight<00:57:41.602> copying<00:57:42.334> this<00:57:42.562> other<00:57:42.806> company<00:57:43.393> that<00:57:43.474> he's<00:57:43.783> used<00:57:43.962> to<00:57:44.044> wearing.

00:57:46.895 --> 00:57:55.682
There's<00:57:47.073> so<00:57:47.218> much<00:57:47.461> trial<00:57:47.866> and<00:57:48.011> error<00:57:48.254> to<00:57:48.351> try<00:57:48.448> and<00:57:48.675> get<00:57:48.901> this<00:57:49.079> sock<00:57:49.727> done<00:57:50.520> that<00:57:50.682> the,<00:57:51.976> the<00:57:52.057> machine<00:57:52.624> keeps<00:57:52.883> malfunctioning<00:57:54.161> and<00:57:54.339> we<00:57:54.485> keep<00:57:54.808> ruining<00:57:55.294> the<00:57:55.440> socks.

00:57:56.748 --> 00:58:02.496
And<00:57:56.828> I<00:57:56.925> think<00:57:57.087> we<00:57:57.151> have<00:57:57.264> enough<00:57:57.490> material<00:57:57.813> for<00:57:57.991> like<00:57:58.233> 20<00:57:58.685> pairs,<00:57:59.283> and<00:57:59.347> we're<00:57:59.493> down<00:57:59.670> to<00:57:59.751> like<00:58:00.074> 2<00:58:00.300> pairs<00:58:00.704> when<00:58:00.865> we<00:58:00.962> finally<00:58:01.447> pull<00:58:01.673> off<00:58:02.157> a<00:58:02.173> sock.

00:58:02.981 --> 00:58:04.856
We're<00:58:03.061> doing<00:58:03.384> all<00:58:03.481> this<00:58:03.724> in<00:58:03.853> the<00:58:03.933> office<00:58:04.192> at<00:58:04.273> San<00:58:04.435> Clemente.

00:58:05.552 --> 00:58:15.709
By<00:58:05.633> the<00:58:05.731> time<00:58:05.974> we<00:58:06.055> get<00:58:06.200> the<00:58:06.281> final<00:58:06.621> sock<00:58:07.026> copied<00:58:07.674> and<00:58:07.820> we're<00:58:08.306> happy<00:58:08.792> with<00:58:09.035> it,<00:58:10.812> It's<00:58:11.068> one<00:58:11.309> day<00:58:11.470> before<00:58:11.791> the<00:58:11.871> game,<00:58:13.172> so<00:58:13.397> we<00:58:13.621> put<00:58:13.782> a<00:58:13.878> woman<00:58:14.264> from<00:58:14.424> our<00:58:14.585> office<00:58:15.083> on<00:58:15.243> an<00:58:15.323> airplane.

00:58:16.110 --> 00:58:18.374
She<00:58:16.287> flies—<00:58:16.752> the<00:58:16.833> first<00:58:17.090> game<00:58:17.266> is<00:58:17.411> in<00:58:17.555> Chicago.

00:58:19.322 --> 00:58:20.478
She<00:58:19.498> flies<00:58:19.771> to<00:58:19.819> the<00:58:19.900> locker<00:58:20.285> room.

00:58:20.542 --> 00:58:25.118
They<00:58:20.638> meet<00:58:21.088> LeBron<00:58:21.666> like<00:58:21.987> before<00:58:22.613> the<00:58:22.709> game<00:58:22.966> because<00:58:23.593> we<00:58:23.673> couldn't<00:58:23.994> FedEx<00:58:24.315> the<00:58:24.411> socks<00:58:24.733> in<00:58:24.877> time.

00:58:25.198 --> 00:58:26.402
We<00:58:25.262> had<00:58:25.391> to<00:58:25.439> just<00:58:25.664> hand<00:58:25.840> deliver<00:58:26.226> them.

00:58:27.671 --> 00:58:29.742
And<00:58:27.767> he's<00:58:28.008> kind<00:58:28.313> of<00:58:28.570> like<00:58:28.747> scrutinizing<00:58:29.694> them.

00:58:29.790 --> 00:58:31.492
He's<00:58:29.999> actually<00:58:30.320> on<00:58:30.481> the<00:58:30.561> massage<00:58:31.075> table.

00:58:31.862 --> 00:58:45.911
Our<00:58:32.022> head<00:58:32.199> of<00:58:32.343> products<00:58:32.745> trying<00:58:32.986> to<00:58:33.082> explain<00:58:33.628> to<00:58:33.708> him<00:58:33.949> why<00:58:34.190> this<00:58:34.415> is<00:58:34.575> a<00:58:34.640> a<00:58:34.992> superior<00:58:35.553> product<00:58:36.115> and<00:58:36.195> he's<00:58:36.355> kind<00:58:36.596> of<00:58:36.676> dismissive<00:58:38.664> and<00:58:38.840> he<00:58:39.001> wears<00:58:39.385> these<00:58:39.562> socks<00:58:40.428> and<00:58:40.604> the,<00:58:41.085> you<00:58:41.165> know,<00:58:41.887> message<00:58:42.368> comes<00:58:42.608> back<00:58:42.865> from<00:58:43.089> the<00:58:43.234> NBA<00:58:43.795> that<00:58:44.757> actually<00:58:45.077> he<00:58:45.174> was<00:58:45.318> happy<00:58:45.639> with<00:58:45.799> them.

00:58:46.777 --> 00:58:53.190
And<00:58:46.921> so<00:58:47.322> I<00:58:47.402> don't<00:58:47.482> know<00:58:47.643> how<00:58:47.819> many,<00:58:48.444> I<00:58:48.541> don't<00:58:48.685> know<00:58:48.749> if<00:58:48.861> we<00:58:49.086> made<00:58:49.262> socks<00:58:49.599> for<00:58:49.807> his<00:58:50.048> whole<00:58:50.160> season,<00:58:50.785> but<00:58:50.946> LeBron<00:58:51.491> wore<00:58:51.651> a<00:58:51.747> different<00:58:52.068> sock<00:58:52.453> than<00:58:52.549> every<00:58:52.774> other<00:58:52.950> player.

00:58:54.473 --> 00:58:54.762
Really?

00:58:55.916 --> 00:58:56.076
Yep.

00:58:56.958 --> 00:59:13.700
It's<00:58:57.760> like<00:58:58.706> if<00:58:58.818> you're<00:58:59.347> a<00:58:59.444> normal<00:59:00.085> NBA<00:59:00.486> player<00:59:00.726> and<00:59:00.870> you're<00:59:01.031> like,<00:59:01.271> I<00:59:01.287> don't<00:59:01.448> like<00:59:01.608> the<00:59:01.704> sock,<00:59:02.153> they<00:59:02.249> probably<00:59:02.490> don't<00:59:02.714> listen<00:59:03.035> to<00:59:03.774> But<00:59:03.918> if<00:59:03.998> you're<00:59:04.432> like<00:59:04.641> LeBron<00:59:05.042> or<00:59:05.299> Chris<00:59:05.701> Paul,<00:59:06.424> or<00:59:07.131> you<00:59:07.211> have<00:59:07.388> all<00:59:07.532> that<00:59:07.789> weight<00:59:08.030> in<00:59:08.175> the<00:59:08.223> league<00:59:08.817> and<00:59:08.898> you're<00:59:09.058> like,<00:59:09.717> I'm<00:59:09.877> not<00:59:10.183> wearing<00:59:10.584> this<00:59:10.825> part<00:59:11.002> of<00:59:11.082> the<00:59:11.243> uniform,<00:59:12.833> the<00:59:12.929> league<00:59:13.234> is<00:59:13.331> concerned.

00:59:13.893 --> 00:59:15.339
They're<00:59:14.054> like,<00:59:14.214> we<00:59:14.295> have<00:59:14.439> to<00:59:14.519> solve<00:59:14.841> this<00:59:15.017> problem.

00:59:15.837 --> 00:59:21.667
So<00:59:16.206> I,<00:59:16.527> it<00:59:16.624> was<00:59:16.849> just<00:59:17.668> this<00:59:17.909> fortuitous,<00:59:19.129> somehow<00:59:19.531> it<00:59:19.740> all<00:59:19.836> came<00:59:20.077> together<00:59:20.543> and<00:59:20.623> we<00:59:20.736> satisfied<00:59:21.459> him.

00:59:21.764 --> 00:59:26.984
But<00:59:21.908> I<00:59:21.989> was<00:59:22.149> really<00:59:22.406> nervous<00:59:22.808> for<00:59:22.888> about<00:59:23.193> 48<00:59:23.595> hours<00:59:24.077> that<00:59:24.735> this<00:59:24.880> was<00:59:25.057> gonna<00:59:25.362> escalate<00:59:25.795> into<00:59:26.036> a<00:59:26.181> big,<00:59:26.422> big<00:59:26.583> problem.

00:59:28.333 --> 00:59:28.462
Wow.

00:59:30.237 --> 00:59:43.877
Well,<00:59:30.736> let<00:59:30.849> me—<00:59:32.330> I<00:59:32.346> have<00:59:32.733> to<00:59:32.781> respect<00:59:33.151> your<00:59:33.232> time<00:59:33.490> and<00:59:33.618> we're<00:59:33.795> probably<00:59:34.053> a<00:59:34.101> little<00:59:34.279> bit<00:59:34.424> over<00:59:35.068> as<00:59:35.245> it<00:59:35.341> is,<00:59:36.114> but<00:59:36.211> I<00:59:36.356> want<00:59:36.517> to<00:59:36.598> talk<00:59:36.759> about<00:59:36.936> you<00:59:37.097> getting<00:59:37.338> back<00:59:37.644> into<00:59:37.821> venture<00:59:38.063> capital<00:59:38.369> and<00:59:38.449> you've<00:59:38.546> been<00:59:38.707> investing<00:59:39.271> this<00:59:39.400> whole<00:59:39.512> time<00:59:40.479> throughout<00:59:41.751> your<00:59:41.912> whole<00:59:42.073> career,<00:59:42.250> but<00:59:42.653> you've<00:59:42.894> kind<00:59:43.055> of<00:59:43.136> come<00:59:43.378> full<00:59:43.539> circle.

00:59:43.941 --> 00:59:46.293
You're<00:59:44.263> the<00:59:44.344> managing<00:59:44.827> director<00:59:45.294> at<00:59:45.375> Pillion<00:59:45.793> Ventures<00:59:46.196> now.

00:59:47.999 --> 00:59:49.971
What<00:59:48.338> gets<00:59:48.645> you<00:59:48.742> excited<00:59:49.470> these<00:59:49.712> days?

00:59:50.035 --> 00:59:51.280
I<00:59:50.100> mean,<00:59:50.262> you<00:59:50.342> don't<00:59:50.520> need<00:59:50.666> to<00:59:50.746> work<00:59:51.005> anymore.

00:59:52.039 --> 00:59:53.704
Why<00:59:52.363> do<00:59:53.009> venture<00:59:53.332> capital?

00:59:54.140 --> 00:59:55.579
What<00:59:54.480> gets<00:59:54.722> you<00:59:54.884> excited<00:59:55.288> about<00:59:55.466> all<00:59:55.498> this?

00:59:57.758 --> 00:59:57.871
Us?

00:59:58.224 --> 01:00:12.540
Look,<00:59:58.465> I<00:59:58.610> think<00:59:58.786> it's<00:59:58.931> kind<00:59:59.108> of—<00:59:59.751> I<00:59:59.815> hate<01:00:00.072> the<01:00:00.152> analogy,<01:00:00.795> but<01:00:00.891> it's<01:00:01.036> kind<01:00:01.213> of<01:00:01.293> a<01:00:01.357> player<01:00:02.482> turned<01:00:02.868> coach<01:00:03.527> analogy<01:00:04.073> a<01:00:04.089> little<01:00:04.410> bit<01:00:05.374> in<01:00:05.519> the<01:00:05.551> sense<01:00:05.921> that<01:00:06.017> I<01:00:06.098> don't<01:00:06.322> know<01:00:06.499> that<01:00:06.644> I<01:00:06.740> would<01:00:06.869> have<01:00:07.030> the<01:00:07.305> tolerance<01:00:08.277> to<01:00:08.439> start<01:00:08.828> a<01:00:08.909> company<01:00:09.396> from<01:00:09.639> dead<01:00:09.833> scratch<01:00:11.016> and<01:00:11.113> get<01:00:11.259> it<01:00:11.421> off<01:00:11.583> the<01:00:11.616> launch<01:00:12.005> pad<01:00:12.232> again.

01:00:12.653 --> 01:00:16.786
It<01:00:12.734> takes<01:00:13.010> such<01:00:13.204> an<01:00:13.301> enormous<01:00:13.625> sacrifice<01:00:14.436> and<01:00:14.582> work<01:00:15.950> and<01:00:16.191> hard<01:00:16.529> to<01:00:16.689> do.

01:00:17.075 --> 01:00:19.164
They<01:00:17.107> don't<01:00:17.397> all<01:00:17.493> work<01:00:17.798> out<01:00:18.216> and<01:00:18.297> I'm<01:00:18.538> getting<01:00:18.843> older.

01:00:19.245 --> 01:00:35.320
And<01:00:20.289> I<01:00:20.466> think<01:00:21.189> the<01:00:21.334> ability<01:00:21.816> to<01:00:21.897> be<01:00:22.009> able<01:00:22.154> to<01:00:22.314> work<01:00:22.636> with<01:00:23.022> young,<01:00:23.664> great<01:00:23.923> entrepreneurs<01:00:24.392> and<01:00:24.459> maybe<01:00:24.627> share<01:00:24.761> the<01:00:24.795> lessons<01:00:25.096> that<01:00:25.448> I<01:00:25.499> learned<01:00:28.379> One<01:00:28.475> of<01:00:28.540> the<01:00:28.620> things<01:00:28.861> we<01:00:28.957> skipped<01:00:29.584> in<01:00:29.680> this<01:00:29.841> interview,<01:00:30.163> which<01:00:30.339> I<01:00:30.404> was<01:00:30.564> happy<01:00:31.030> we<01:00:31.111> skipped,<01:00:31.593> is<01:00:31.689> before<01:00:32.155> vSpring,<01:00:32.878> I<01:00:32.958> had<01:00:33.071> another<01:00:33.521> Utah<01:00:33.698> startup<01:00:34.501> called<01:00:34.742> Freeport.

01:00:35.947 --> 01:00:41.860
I<01:00:36.011> actually<01:00:36.493> raised<01:00:36.815> money<01:00:37.233> from<01:00:37.795> Wasatch,<01:00:38.663> now<01:00:38.904> Epic,<01:00:40.366> and<01:00:40.526> some<01:00:40.671> Utah<01:00:40.928> County<01:00:41.314> Angels.

01:00:42.599 --> 01:00:49.251
And<01:00:43.162> in<01:00:43.579> 2000,<01:00:44.142> when<01:00:44.302> the<01:00:44.383> dot-com<01:00:44.945> crash,<01:00:45.733> we<01:00:46.006> sold<01:00:46.375> the<01:00:46.456> business<01:00:46.857> off<01:00:47.034> in<01:00:47.195> pieces<01:00:47.821> and<01:00:47.918> laid<01:00:48.143> off<01:00:48.303> 100<01:00:48.705> employees.

01:00:49.348 --> 01:00:53.445
It<01:00:49.444> was<01:00:49.589> a<01:00:49.621> super<01:00:50.071> painful<01:00:50.794> failure<01:00:52.015> for<01:00:52.176> me,<01:00:52.497> my<01:00:52.722> first<01:00:53.220> venture.

01:00:54.409 --> 01:01:01.606
And<01:00:54.682> of<01:00:54.763> course,<01:00:55.052> I<01:00:55.148> learned<01:00:55.534> more<01:00:55.710> lessons,<01:00:56.739> uh,<01:00:57.237> shutting<01:00:57.638> that<01:00:57.863> company<01:00:58.201> down<01:00:58.682> and,<01:00:59.711> and<01:01:00.193> coping<01:01:00.675> with<01:01:01.076> the<01:01:01.156> failure.

01:01:02.442 --> 01:01:09.173
Um,<01:01:02.715> you<01:01:02.795> know,<01:01:02.940> I<01:01:03.100> felt<01:01:03.261> like<01:01:03.422> I<01:01:03.582> went<01:01:03.743> from<01:01:03.984> paper<01:01:04.450> multimillionaire<01:01:05.366> to<01:01:05.510> failure<01:01:06.137> in<01:01:06.297> like<01:01:06.474> a<01:01:06.538> matter<01:01:06.876> of<01:01:07.117> months<01:01:07.663> as<01:01:07.840> the<01:01:07.904> stock<01:01:08.241> market<01:01:08.562> melted<01:01:08.948> down.

01:01:10.314 --> 01:01:14.764
And<01:01:10.796> that<01:01:11.133> taught<01:01:11.438> more<01:01:11.615> lessons<01:01:12.161> than<01:01:12.257> nearly<01:01:12.723> any<01:01:12.964> other<01:01:13.623> successful<01:01:14.266> venture.

01:01:14.908 --> 01:01:20.499
In<01:01:15.053> fact,<01:01:15.952> a<01:01:16.017> lot<01:01:16.193> of<01:01:16.258> the<01:01:16.290> lessons<01:01:16.740> learned<01:01:17.077> there<01:01:17.382> went<01:01:17.543> into<01:01:17.864> LogoWorks<01:01:18.603> and<01:01:18.764> later<01:01:19.021> Skullcandy,<01:01:19.808> those<01:01:20.049> kinds<01:01:20.306> of<01:01:20.402> things.

01:01:22.441 --> 01:01:30.016
But<01:01:22.587> I<01:01:22.619> think<01:01:22.927> being<01:01:23.234> able<01:01:23.510> to<01:01:24.141> share<01:01:24.707> all<01:01:24.853> that<01:01:25.015> information<01:01:25.678> with<01:01:25.857> a<01:01:25.921> younger<01:01:26.310> entrepreneur,<01:01:27.767> like,<01:01:27.961> and<01:01:28.106> being<01:01:28.268> their<01:01:28.495> confidant,<01:01:29.304> I've<01:01:29.401> always<01:01:29.790> been<01:01:29.952> that.

01:01:30.065 --> 01:01:31.069
I<01:01:30.195> was<01:01:30.356> that<01:01:30.615> with<01:01:30.923> Rick.

01:01:32.560 --> 01:01:35.664
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01:01:35.728 --> 01:01:36.951
It<01:01:35.889> never<01:01:36.130> felt<01:01:36.356> like<01:01:36.597> work.

01:01:37.417 --> 01:01:41.599
My<01:01:37.578> partner<01:01:37.835> Morgan<01:01:38.205> and<01:01:38.302> I<01:01:38.463> talked<01:01:38.768> around<01:01:39.090> the<01:01:39.186> clock<01:01:39.894> at<01:01:39.991> Logo<01:01:40.312> Works<01:01:40.586> because<01:01:40.859> we<01:01:40.956> wanted<01:01:41.294> to.

01:01:43.080 --> 01:01:52.106
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01:01:52.571 --> 01:01:59.315
I<01:01:52.635> really<01:01:52.892> like<01:01:53.133> being<01:01:53.358> this<01:01:53.535> person<01:01:53.856> in<01:01:54.000> the<01:01:54.080> background<01:01:55.124> and<01:01:55.220> just<01:01:55.445> sort<01:01:55.542> of<01:01:56.023> trying<01:01:56.248> to<01:01:56.344> create<01:01:56.666> value<01:01:57.308> through<01:01:58.111> the<01:01:58.191> coaching<01:01:58.608> experience.

01:02:00.262 --> 01:02:02.944
And<01:02:01.001> so,<01:02:01.723> I<01:02:01.788> don't<01:02:01.948> know,<01:02:02.285> there<01:02:02.430> was<01:02:02.607> that.

01:02:03.008 --> 01:02:10.153
And<01:02:03.152> then<01:02:03.490> the<01:02:03.650> other<01:02:03.811> story<01:02:04.196> was<01:02:04.292> that<01:02:04.469> I<01:02:04.517> actually<01:02:05.176> interviewed<01:02:05.657> at<01:02:05.882> Novell<01:02:06.219> Ventures<01:02:07.440> in<01:02:07.568> the<01:02:07.664> late<01:02:07.905> '90s<01:02:08.467> when<01:02:08.612> I<01:02:08.708> just<01:02:08.933> graduated<01:02:09.415> from<01:02:09.575> BYU.

01:02:10.635 --> 01:02:12.321
They<01:02:10.683> had<01:02:10.779> a<01:02:10.811> $300<01:02:11.197> million<01:02:11.679> venture<01:02:12.064> fund.

01:02:12.803 --> 01:02:14.506
And<01:02:12.947> I<01:02:13.044> thought<01:02:13.510> I<01:02:13.590> would<01:02:13.767> get<01:02:13.911> a<01:02:13.992> job<01:02:14.393> there.

01:02:14.715 --> 01:02:18.185
They<01:02:14.811> seemed<01:02:15.132> like<01:02:15.374> they<01:02:15.518> liked<01:02:15.856> me,<01:02:17.061> but<01:02:17.205> an<01:02:17.286> offer<01:02:17.543> never<01:02:17.864> came.

01:02:18.651 --> 01:02:21.158
Of<01:02:18.732> course,<01:02:18.908> the<01:02:19.149> person<01:02:19.856> I<01:02:19.953> interviewed<01:02:20.355> with<01:02:20.579> was<01:02:20.820> Blake.

01:02:21.624 --> 01:02:23.070
He<01:02:21.704> was<01:02:21.801> running<01:02:22.010> the<01:02:22.122> venture<01:02:22.347> fund<01:02:22.540> at<01:02:22.749> the<01:02:22.926> time.

01:02:23.151 --> 01:02:24.243
He<01:02:23.183> hadn't<01:02:23.472> come<01:02:23.681> to<01:02:23.809> Thalia.

01:02:24.870 --> 01:02:37.463
So<01:02:25.095> when<01:02:25.320> Blake<01:02:25.642> called,<01:02:26.043> I<01:02:26.059> don't<01:02:26.220> know,<01:02:26.300> I<01:02:26.316> guess<01:02:26.541> it's<01:02:26.863> been<01:02:26.959> about<01:02:27.184> 3<01:02:27.409> years<01:02:27.602> ago<01:02:27.827> now,<01:02:28.068> and<01:02:28.229> said,<01:02:28.454> "Hey,<01:02:29.274> would<01:02:29.434> you<01:02:29.579> ever<01:02:29.916> be<01:02:30.061> open-minded<01:02:30.543> to<01:02:30.623> coming<01:02:30.881> back<01:02:31.090> to<01:02:31.203> investing<01:02:31.688> full-time?"<01:02:33.710> That<01:02:33.856> was<01:02:34.017> intriguing<01:02:34.681> just<01:02:34.875> because<01:02:35.069> it<01:02:35.150> felt<01:02:35.392> like<01:02:35.651> this<01:02:36.039> chapter<01:02:36.525> that<01:02:36.622> had<01:02:36.767> never<01:02:37.026> closed.

01:02:37.511 --> 01:02:38.320
Blake<01:02:37.754> and<01:02:37.835> I<01:02:37.916> could<01:02:38.061> work<01:02:38.110> together.

01:02:39.408 --> 01:02:41.720
And<01:02:39.825> we'd<01:02:40.050> co-invested<01:02:40.628> together<01:02:41.029> over<01:02:41.206> the<01:02:41.335> years.

01:02:41.832 --> 01:02:44.417
And,<01:02:43.036> and<01:02:43.133> so<01:02:43.293> I<01:02:43.358> think<01:02:43.534> it<01:02:43.598> just<01:02:43.759> felt<01:02:43.920> natural.

01:02:44.465 --> 01:02:52.445
And<01:02:44.546> then<01:02:44.642> when<01:02:44.787> I<01:02:44.947> looked<01:02:45.204> at<01:02:45.429> my<01:02:46.312> personal<01:02:46.665> angel<01:02:46.970> investments,<01:02:47.612> I<01:02:47.757> think<01:02:47.918> I<01:02:47.998> had<01:02:48.094> about<01:02:48.335> 15<01:02:48.977> in<01:02:49.154> Southern<01:02:49.523> California,<01:02:50.101> 15<01:02:50.583> in<01:02:50.743> Utah,<01:02:51.129> and<01:02:51.289> 15<01:02:51.707> in<01:02:51.787> the<01:02:51.867> Bay<01:02:52.012> Area.

01:02:53.152 --> 01:02:58.306
And<01:02:53.296> I<01:02:53.457> looked<01:02:53.714> at<01:02:53.939> Pelion's<01:02:54.501> deal<01:02:54.741> flow<01:02:55.303> and<01:02:55.400> it<01:02:55.480> was<01:02:55.624> kind<01:02:55.769> of<01:02:55.817> like<01:02:56.186> a<01:02:56.202> third,<01:02:56.620> a<01:02:56.668> third,<01:02:56.909> a<01:02:56.925> third<01:02:57.262> in<01:02:57.391> the<01:02:57.423> same<01:02:57.792> triangle.

01:02:58.482 --> 01:03:01.951
So<01:02:59.558> it<01:02:59.719> felt<01:02:59.895> like<01:03:00.120> I<01:03:00.216> could<01:03:00.377> invest<01:03:00.714> in<01:03:00.778> the<01:03:00.859> same<01:03:01.164> geographies.

01:03:02.384 --> 01:03:04.359
I<01:03:02.448> had<01:03:02.785> talked<01:03:03.042> to<01:03:03.171> a<01:03:03.187> couple<01:03:03.428> of<01:03:03.524> other<01:03:03.749> venture<01:03:04.054> funds.

01:03:05.362 --> 01:03:10.285
That<01:03:05.524> really<01:03:05.831> wanted<01:03:06.026> a<01:03:06.090> specialist,<01:03:06.900> like,<01:03:07.143> come<01:03:07.305> be<01:03:07.467> our<01:03:07.629> consumer<01:03:08.179> investor,<01:03:08.779> or<01:03:08.908> come<01:03:09.086> be<01:03:09.248> our<01:03:09.345> SaaS<01:03:09.815> investor.

01:03:11.757 --> 01:03:15.765
And<01:03:11.918> I<01:03:13.463> didn't<01:03:13.769> want<01:03:14.091> that<01:03:15.073> constraint.

01:03:15.958 --> 01:03:25.758
I<01:03:16.039> like<01:03:16.296> the<01:03:16.441> idea<01:03:16.747> of<01:03:16.844> being<01:03:17.021> able<01:03:17.198> to<01:03:17.246> invest<01:03:17.729> in<01:03:17.810> anything<01:03:18.212> and<01:03:18.357> everything,<01:03:19.645> um,<01:03:19.822> and<01:03:19.967> being<01:03:20.144> a<01:03:20.224> generalist,<01:03:20.949> which<01:03:21.110> I<01:03:21.190> think<01:03:21.432> you<01:03:21.513> can<01:03:21.674> only<01:03:21.997> really<01:03:22.239> do<01:03:22.481> these<01:03:22.723> days<01:03:23.757> if<01:03:23.918> you're<01:03:24.015> a<01:03:24.176> geographically<01:03:24.984> focused<01:03:25.452> fund.

01:03:25.807 --> 01:03:29.342
It's<01:03:25.952> tough<01:03:26.130> to<01:03:26.210> be<01:03:26.356> a<01:03:26.436> generalist<01:03:27.018> in<01:03:27.082> Silicon<01:03:27.550> Valley<01:03:27.889> because<01:03:28.148> how<01:03:28.309> else<01:03:28.519> do<01:03:28.584> you<01:03:28.616> differentiate?

01:03:30.133 --> 01:03:35.415
Um,<01:03:31.115> which<01:03:31.277> is<01:03:31.375> why<01:03:31.522> most<01:03:31.782> firms<01:03:32.125> have<01:03:32.369> highly<01:03:32.760> focused<01:03:33.167> practices<01:03:33.819> in<01:03:34.047> each<01:03:34.161> of<01:03:34.307> the<01:03:34.389> key<01:03:34.552> investment<01:03:35.040> areas.

01:03:36.350 --> 01:03:38.728
So<01:03:36.447> I<01:03:36.544> think<01:03:36.770> all<01:03:36.867> those<01:03:37.110> things<01:03:37.353> combined<01:03:37.903> weighed<01:03:38.065> on<01:03:38.162> the<01:03:38.243> decision.

01:03:38.793 --> 01:03:47.309
And<01:03:38.971> then<01:03:39.197> last<01:03:39.521> but<01:03:39.618> not<01:03:39.861> least,<01:03:40.168> the<01:03:40.249> most<01:03:40.443> important<01:03:40.831> part<01:03:41.155> was<01:03:41.381> just<01:03:42.951> from<01:03:43.566> a,<01:03:45.450> how<01:03:45.514> do<01:03:45.627> I<01:03:45.724> see<01:03:45.967> the<01:03:46.193> world<01:03:46.598> developing?

01:03:47.406 --> 01:03:52.889
I<01:03:47.487> had<01:03:47.730> read<01:03:47.891> the<01:03:48.134> University<01:03:48.652> of<01:03:48.862> Utah<01:03:49.201> census<01:03:49.848> that<01:03:50.010> they<01:03:50.172> were<01:03:50.398> predicting<01:03:50.819> the<01:03:50.899> state<01:03:51.223> would<01:03:51.449> double<01:03:51.773> in<01:03:51.854> the<01:03:51.886> next<01:03:52.193> 19<01:03:52.598> years.

01:03:54.267 --> 01:04:05.543
And<01:03:54.673> I<01:03:54.770> had<01:03:54.949> seen<01:03:55.662> the<01:03:55.744> number<01:03:55.971> of<01:03:56.133> companies<01:03:56.814> spinning<01:03:57.431> out<01:03:57.626> of<01:03:57.853> Domo,<01:03:59.067> Qualtrics,<01:04:00.349> Vivint,<01:04:01.311> Pluralsight,<01:04:02.914> all<01:04:02.994> of<01:04:03.090> these<01:04:03.395> great<01:04:03.715> Utah<01:04:04.036> companies<01:04:04.597> that<01:04:04.677> had<01:04:04.773> been<01:04:04.950> founded.

01:04:06.216 --> 01:04:09.711
And<01:04:06.312> I<01:04:06.440> could<01:04:06.553> see<01:04:06.857> people<01:04:07.178> leaving<01:04:07.595> and<01:04:07.739> starting<01:04:08.204> the<01:04:08.236> next<01:04:08.540> generation<01:04:09.021> of<01:04:09.182> companies.

01:04:10.688 --> 01:04:12.388
And<01:04:10.769> I<01:04:10.929> was<01:04:11.025> just<01:04:11.185> so<01:04:11.426> long<01:04:11.891> on<01:04:12.051> Utah.

01:04:12.933 --> 01:04:14.792
I'm<01:04:13.109> so<01:04:13.349> long<01:04:13.894> on<01:04:14.071> Utah,<01:04:14.391> Clint.

01:04:15.818 --> 01:04:19.184
I<01:04:15.834> could<01:04:16.139> really<01:04:16.459> believe<01:04:16.876> this<01:04:17.117> is<01:04:17.341> the<01:04:17.373> next<01:04:18.078> big,<01:04:18.559> big<01:04:18.880> place.

01:04:20.563 --> 01:04:34.405
And<01:04:20.643> the<01:04:20.787> reason<01:04:21.108> why,<01:04:21.284> you<01:04:21.381> know,<01:04:21.926> I<01:04:22.070> believe<01:04:22.406> this<01:04:22.727> is<01:04:22.967> I<01:04:23.048> put<01:04:23.352> half<01:04:23.705> of<01:04:23.849> my<01:04:24.074> 401<01:04:25.677> At<01:04:25.838> the<01:04:26.094> depths<01:04:26.800> of<01:04:27.057> the<01:04:27.939> pandemic,<01:04:28.741> while<01:04:28.902> the<01:04:28.982> market<01:04:29.447> was<01:04:29.544> still<01:04:30.490> crashing<01:04:31.212> and<01:04:31.373> people<01:04:31.693> were<01:04:31.774> uncertain<01:04:32.255> what<01:04:32.415> was<01:04:32.576> going<01:04:32.672> to<01:04:32.752> happen,<01:04:33.298> we<01:04:33.378> were<01:04:33.538> under<01:04:33.795> lockdown.

01:04:34.998 --> 01:04:40.999
The<01:04:35.143> first<01:04:35.496> move<01:04:35.784> I<01:04:35.801> made<01:04:36.843> was<01:04:36.988> I<01:04:37.004> shifted<01:04:37.485> my<01:04:37.646> 401,<01:04:39.073> more<01:04:39.250> than<01:04:39.394> half<01:04:39.667> of<01:04:39.827> it,<01:04:40.196> into<01:04:40.373> Zions<01:04:40.774> Bank.

01:04:41.271 --> 01:04:44.913
It's<01:04:41.961> like<01:04:42.202> my<01:04:42.443> retirement,<01:04:43.678> I'm<01:04:43.902> going<01:04:44.223> long<01:04:44.480> Zions.

01:04:44.961 --> 01:04:47.673
I'm<01:04:45.058> like,<01:04:45.202> Zions<01:04:45.667> at<01:04:45.892> $18<01:04:46.293> a<01:04:46.485> share,<01:04:46.774> are<01:04:46.935> you<01:04:47.111> kidding<01:04:47.432> me?

01:04:48.234 --> 01:04:49.357
I'm<01:04:48.475> backing<01:04:48.860> the<01:04:48.940> truck<01:04:49.261> up.

01:04:50.159 --> 01:04:53.818
And<01:04:50.240> my<01:04:50.336> thought<01:04:50.705> is,<01:04:51.507> The<01:04:51.844> population<01:04:52.245> is<01:04:52.326> going<01:04:52.422> to<01:04:52.566> double<01:04:52.823> in<01:04:52.887> the<01:04:52.952> next<01:04:53.192> 19<01:04:53.529> years.

01:04:54.717 --> 01:04:58.232
Each<01:04:54.877> one<01:04:54.990> of<01:04:55.038> these<01:04:55.214> tech<01:04:55.439> companies<01:04:55.856> goes<01:04:56.097> public<01:04:56.579> and<01:04:56.659> produces<01:04:57.140> hundreds<01:04:57.638> of<01:04:57.782> millionaires.

01:04:58.408 --> 01:05:02.838
We<01:04:58.504> still<01:04:58.745> have<01:04:59.130> MX<01:05:00.190> and<01:05:00.350> Lucid<01:05:01.136> and<01:05:01.377> We<01:05:02.035> and<01:05:02.196> Podium.

01:05:03.078 --> 01:05:08.904
There's<01:05:03.303> a<01:05:03.399> whole<01:05:03.624> nother<01:05:04.041> wave<01:05:04.442> of<01:05:04.603> mature,<01:05:05.165> great<01:05:05.470> companies<01:05:05.967> that<01:05:06.112> haven't<01:05:06.593> exited<01:05:07.492> and<01:05:07.636> are<01:05:07.716> going<01:05:07.797> to<01:05:07.893> create<01:05:08.294> a<01:05:08.358> bunch<01:05:08.551> of<01:05:08.679> wealth.

01:05:10.204 --> 01:05:13.959
And<01:05:10.942> I<01:05:11.022> just<01:05:11.247> thought,<01:05:12.146> who's<01:05:12.467> going<01:05:12.691> to<01:05:13.173> do<01:05:13.333> the<01:05:13.398> mortgages?

01:05:14.152 --> 01:05:15.404
Who's<01:05:14.328> going<01:05:14.457> to<01:05:14.553> do<01:05:14.714> the<01:05:14.794> car<01:05:15.099> loans?

01:05:15.757 --> 01:05:17.249
Who's<01:05:15.917> going<01:05:16.014> to<01:05:16.078> finance<01:05:16.479> these<01:05:16.575> small<01:05:16.880> businesses?

01:05:18.084 --> 01:05:18.936
It's<01:05:18.165> going<01:05:18.261> to<01:05:18.325> be<01:05:18.422> Zions.

01:05:19.610 --> 01:05:22.244
Like,<01:05:19.674> I<01:05:19.707> can't<01:05:19.964> think<01:05:20.156> of<01:05:20.413> a<01:05:20.638> better<01:05:21.216> regional<01:05:21.682> bank.

01:05:23.401 --> 01:05:41.261
So,<01:05:24.027> you<01:05:24.124> know,<01:05:24.332> literally<01:05:24.830> I'm<01:05:25.087> voting<01:05:25.392> with<01:05:25.633> my<01:05:25.794> feet<01:05:26.581> by<01:05:26.758> being<01:05:26.918> a<01:05:27.063> venture<01:05:27.320> investor<01:05:27.818> in<01:05:27.962> Utah,<01:05:29.231> and<01:05:29.311> I<01:05:29.472> voted<01:05:29.809> with<01:05:30.034> my<01:05:30.211> own<01:05:30.452> dollars<01:05:31.817> by<01:05:32.058> backing<01:05:32.459> the<01:05:32.620> largest<01:05:33.182> bank<01:05:33.487> in<01:05:33.648> Utah,<01:05:34.066> just<01:05:34.226> because<01:05:34.531> I<01:05:34.628> believe<01:05:35.094> our<01:05:35.351> region<01:05:35.752> is<01:05:35.913> going<01:05:36.057> to<01:05:36.138> continue<01:05:37.679> to<01:05:38.547> perform<01:05:39.366> so<01:05:39.671> much<01:05:39.928> better<01:05:40.233> than<01:05:40.410> most<01:05:40.651> other<01:05:40.892> regions.

01:05:41.358 --> 01:05:45.597
I<01:05:41.390> mean,<01:05:41.598> there's<01:05:41.855> no<01:05:42.161> reason<01:05:42.562> we<01:05:42.659> shouldn't<01:05:43.044> be<01:05:43.285> bigger<01:05:44.264> or<01:05:44.489> different<01:05:44.907> than<01:05:45.148> Denver.

01:05:46.978 --> 01:05:56.066
And<01:05:47.877> they<01:05:47.990> don't—<01:05:49.001> the<01:05:49.097> number<01:05:49.627> of<01:05:50.992> companies<01:05:51.570> at<01:05:51.747> scale<01:05:52.678> that<01:05:52.919> we<01:05:53.096> have<01:05:53.401> versus<01:05:53.738> what<01:05:53.882> they<01:05:54.059> have,<01:05:55.006> you<01:05:55.087> can't<01:05:55.263> even<01:05:55.424> compare<01:05:55.761> the<01:05:55.905> two.

01:05:56.789 --> 01:05:59.759
Not<01:05:56.901> to<01:05:57.029> pick<01:05:57.190> on<01:05:57.351> Denver<01:05:57.832> or<01:05:58.057> others,<01:05:58.555> it's<01:05:58.731> like,<01:05:58.940> but<01:05:59.020> they're<01:05:59.117> not<01:05:59.277> in<01:05:59.326> the<01:05:59.470> same—.

01:05:59.904 --> 01:06:01.108
Even<01:06:00.144> Austin,<01:06:00.787> right?

01:06:01.349 --> 01:06:01.702
Austin.

01:06:01.750 --> 01:06:05.074
I<01:06:01.766> mean,<01:06:02.007> they<01:06:02.152> have<01:06:02.312> like<01:06:02.424> established<01:06:02.890> companies<01:06:03.195> that<01:06:03.292> are<01:06:03.356> moving<01:06:03.854> there,<01:06:04.737> right?

01:06:05.202 --> 01:06:07.274
That<01:06:05.604> are<01:06:06.326> putting<01:06:06.567> corporate<01:06:06.840> headquarters.

01:06:07.370 --> 01:06:11.914
But<01:06:07.450> you<01:06:07.547> put<01:06:07.723> like<01:06:07.932> the<01:06:08.012> homegrown<01:06:09.859> companies<01:06:10.356> versus<01:06:10.742> Utah,<01:06:11.015> it's<01:06:11.240> not<01:06:11.400> comparable.

01:06:12.203 --> 01:06:20.938
It<01:06:12.267> doesn't<01:06:12.508> get<01:06:12.669> the<01:06:12.701> national<01:06:13.568> attention<01:06:15.157> because<01:06:15.430> it's<01:06:15.591> not<01:06:16.362> Austin,<01:06:17.646> right,<01:06:17.967> which<01:06:18.128> has<01:06:18.304> its<01:06:18.465> own<01:06:19.091> appeal<01:06:19.589> and<01:06:19.669> all<01:06:19.750> that<01:06:19.910> type<01:06:19.990> of<01:06:20.151> stuff<01:06:20.392> outside<01:06:20.793> of<01:06:20.890> it.

01:06:21.034 --> 01:06:24.133
But,<01:06:21.516> but<01:06:21.612> yeah,<01:06:21.821> Utah<01:06:22.078> blows<01:06:22.463> these,<01:06:23.041> these<01:06:23.282> ecosystems<01:06:23.924> away.

01:06:24.229 --> 01:06:28.533
They<01:06:24.326> get<01:06:24.406> a<01:06:24.486> lot<01:06:24.727> of—<01:06:25.193> like<01:06:25.353> Miami,<01:06:25.771> for<01:06:25.931> example,<01:06:26.654> which<01:06:26.814> is<01:06:26.911> getting<01:06:27.200> a<01:06:27.216> lot<01:06:27.392> of<01:06:27.617> publicity<01:06:28.179> right<01:06:28.340> now.

01:06:29.528 --> 01:06:31.631
Utah's<01:06:29.865> blowing<01:06:30.186> Miami<01:06:30.668> away<01:06:31.294> right<01:06:31.535> now.

01:06:31.792 --> 01:06:32.611
Will<01:06:31.937> that<01:06:32.033> continue?

01:06:32.916 --> 01:06:33.526
Who<01:06:33.077> knows?

01:06:33.639 --> 01:06:38.266
But<01:06:34.988> It's<01:06:35.791> Miami's<01:06:36.370> getting<01:06:36.611> the<01:06:36.691> pub<01:06:36.916> because<01:06:37.173> it's<01:06:37.398> freaking<01:06:37.735> Miami.

01:06:39.728 --> 01:06:43.777
Like,<01:06:39.889> I<01:06:39.905> got<01:06:40.146> like<01:06:40.547> 20<01:06:40.949> venture<01:06:41.271> friends<01:06:41.737> that<01:06:41.785> have<01:06:41.913> moved<01:06:42.138> to<01:06:42.540> Miami<01:06:42.958> during<01:06:43.183> the<01:06:43.263> pandemic.

01:06:43.858 --> 01:06:54.592
Some<01:06:44.066> have<01:06:44.227> now<01:06:44.565> gone<01:06:44.790> back<01:06:44.982> to<01:06:45.047> New<01:06:45.191> York<01:06:45.609> or<01:06:45.689> other<01:06:45.914> places,<01:06:46.316> but<01:06:47.441> I<01:06:47.521> have<01:06:47.634> a<01:06:47.859> really<01:06:48.726> close<01:06:48.984> friend<01:06:50.269> and<01:06:50.414> I<01:06:50.510> was<01:06:50.735> asking<01:06:51.056> him,<01:06:51.378> and<01:06:51.426> he's<01:06:51.571> at<01:06:51.651> a<01:06:51.699> fund,<01:06:52.117> and<01:06:52.165> I'm<01:06:52.278> like,<01:06:52.503> hey,<01:06:53.065> you<01:06:53.161> know,<01:06:53.627> tell<01:06:53.788> me<01:06:53.868> about<01:06:54.109> the<01:06:54.190> deal<01:06:54.431> flow.

01:06:54.672 --> 01:07:00.119
And<01:06:54.736> he's<01:06:54.833> like,<01:06:55.074> honestly,<01:06:55.957> I'm<01:06:56.391> seeing<01:06:56.841> way<01:06:56.938> more<01:06:57.243> deals<01:06:57.886> in<01:06:58.062> Nashville<01:06:58.689> and<01:06:58.769> Atlanta<01:06:59.332> than<01:06:59.444> I<01:06:59.589> am<01:06:59.750> in<01:06:59.830> Miami.

01:07:01.016 --> 01:07:02.193
So<01:07:01.161> everyone<01:07:01.500> went<01:07:01.661> to<01:07:01.757> Miami.

01:07:02.531 --> 01:07:04.482
I<01:07:03.015> think<01:07:03.192> it<01:07:03.337> will<01:07:03.515> develop<01:07:03.934> into<01:07:04.095> something.

01:07:04.546 --> 01:07:05.304
There's<01:07:04.659> no<01:07:04.869> question.

01:07:05.368 --> 01:07:13.329
They<01:07:05.449> have<01:07:05.594> such<01:07:05.787> a<01:07:05.852> supportive<01:07:06.336> mayor<01:07:06.739> and<01:07:07.061> too<01:07:07.206> many<01:07:07.464> good<01:07:07.609> investors<01:07:08.093> have<01:07:08.270> moved<01:07:08.512> there,<01:07:10.371> but<01:07:10.694> 9<01:07:11.486> women<01:07:12.149> can't<01:07:12.375> have<01:07:12.553> a<01:07:12.634> baby<01:07:12.876> in<01:07:12.973> a<01:07:13.038> month.

01:07:14.655 --> 01:07:16.659
These<01:07:15.043> things<01:07:15.398> are<01:07:15.528> a<01:07:15.560> natural<01:07:16.174> process.

01:07:16.821 --> 01:07:19.718
Like<01:07:17.322> it<01:07:17.484> takes<01:07:17.807> time<01:07:18.211> to<01:07:18.260> get<01:07:18.454> big<01:07:18.778> anchor<01:07:19.021> tenant<01:07:19.361> companies.

01:07:19.831 --> 01:07:21.532
Qualtrics<01:07:20.382> was<01:07:20.479> 20<01:07:20.787> years<01:07:21.046> in<01:07:21.127> the<01:07:21.192> making.

01:07:22.018 --> 01:07:23.898
Yeah,<01:07:22.278> it's<01:07:22.407> worth<01:07:22.585> $35<01:07:22.990> or<01:07:23.071> $40<01:07:23.396> billion<01:07:23.720> now.

01:07:24.919 --> 01:07:26.215
That<01:07:25.097> did<01:07:25.324> not<01:07:25.567> happen<01:07:25.891> overnight.

01:07:27.038 --> 01:07:30.262
It<01:07:27.070> was<01:07:27.278> a<01:07:27.519> long<01:07:27.920> time<01:07:28.337> of<01:07:28.417> sacrifice<01:07:29.059> in<01:07:29.139> the<01:07:29.203> making<01:07:29.621> to<01:07:29.765> get<01:07:30.022> there.

01:07:30.968 --> 01:07:40.354
And<01:07:31.064> so<01:07:32.187> the<01:07:32.412> odds<01:07:32.733> that<01:07:32.909> Miami<01:07:33.294> is<01:07:33.535> going<01:07:33.599> to<01:07:33.696> have<01:07:33.872> like<01:07:34.113> a<01:07:34.418> $40<01:07:35.059> billion<01:07:35.797> company<01:07:36.198> tomorrow<01:07:36.920> are<01:07:37.145> low<01:07:37.337> because<01:07:38.188> these<01:07:38.380> companies<01:07:38.765> take<01:07:39.006> time<01:07:39.327> to<01:07:39.471> grow<01:07:39.664> and<01:07:39.808> develop.

01:07:40.915 --> 01:07:52.065
Like<01:07:41.573> what<01:07:41.749> happened<01:07:42.150> in<01:07:42.359> Utah<01:07:42.856> was<01:07:43.081> there<01:07:43.161> was<01:07:43.274> a<01:07:43.338> bunch<01:07:43.514> of<01:07:43.659> entrepreneurs<01:07:44.220> like<01:07:44.525> Ryan<01:07:44.926> who<01:07:45.022> spent<01:07:45.327> the<01:07:45.407> last<01:07:45.664> 20<01:07:46.065> years<01:07:47.910> building<01:07:48.375> real<01:07:48.616> value<01:07:49.033> into<01:07:49.258> these<01:07:49.514> businesses<01:07:50.060> that<01:07:50.156> are<01:07:50.236> only<01:07:50.557> now<01:07:51.279> everyone<01:07:51.680> can<01:07:51.841> see<01:07:51.985> them.

01:07:53.029 --> 01:07:57.705
And<01:07:53.190> we<01:07:53.286> have<01:07:53.447> a<01:07:53.608> whole<01:07:53.833> nother<01:07:54.170> group,<01:07:54.411> like<01:07:54.572> I<01:07:54.588> mentioned,<01:07:55.455> right<01:07:55.680> behind<01:07:56.002> them<01:07:56.500> and<01:07:56.580> another<01:07:56.966> group<01:07:57.126> behind<01:07:57.448> that.

01:07:58.428 --> 01:08:11.427
So<01:07:58.589> like<01:07:58.830> the<01:07:58.926> num—<01:07:59.392> the<01:07:59.537> velocity<01:08:00.292> of<01:08:00.436> companies<01:08:01.079> getting<01:08:01.384> to<01:08:01.481> scale<01:08:02.204> in<01:08:02.445> Utah,<01:08:03.730> I<01:08:03.811> don't<01:08:04.052> think<01:08:04.293> there's<01:08:04.469> another<01:08:05.000> ecosystem,<01:08:05.498> save<01:08:05.819> maybe<01:08:06.156> New<01:08:06.381> York<01:08:06.719> or<01:08:06.847> LA,<01:08:07.972> which<01:08:08.133> obviously<01:08:08.454> have<01:08:08.631> population<01:08:09.209> advantages<01:08:09.756> and<01:08:09.900> capital<01:08:10.302> advantages<01:08:10.880> that<01:08:11.041> we<01:08:11.121> don't.

01:08:12.246 --> 01:08:18.078
But<01:08:12.391> outside<01:08:12.712> of<01:08:12.744> those<01:08:12.969> markets,<01:08:13.435> I<01:08:13.451> don't<01:08:13.676> think<01:08:13.853> there's<01:08:14.013> another<01:08:14.512> secondary<01:08:15.058> market<01:08:15.540> that<01:08:16.247> can<01:08:16.407> hold<01:08:16.584> a<01:08:16.648> candle<01:08:17.066> to,<01:08:17.468> to<01:08:17.613> what<01:08:17.789> Utah<01:08:18.046> is.

01:08:18.459 --> 01:08:32.583
It's<01:08:18.918> really<01:08:19.114> a<01:08:19.245> testament<01:08:19.753> to<01:08:19.835> the<01:08:19.999> culture,<01:08:21.292> all<01:08:21.390> of<01:08:21.554> the<01:08:21.718> entrepreneurs<01:08:22.373> that<01:08:22.536> came<01:08:22.782> before,<01:08:24.819> and<01:08:24.932> just<01:08:25.012> sort<01:08:25.238> of<01:08:26.869> a<01:08:27.095> unified—<01:08:27.740> Silicon<01:08:28.079> Slopes<01:08:28.338> is<01:08:28.402> a<01:08:28.467> big<01:08:28.628> part<01:08:28.822> of<01:08:28.886> this,<01:08:29.694> like<01:08:29.920> Josh's<01:08:30.404> first<01:08:30.743> map<01:08:31.147> back<01:08:31.405> in<01:08:31.712> whatever,<01:08:32.067> '06.

01:08:33.164 --> 01:08:33.374
Oh,<01:08:33.245> yeah.

01:08:33.471 --> 01:08:37.319
When<01:08:33.568> he<01:08:33.649> was<01:08:33.859> selling<01:08:34.036> the<01:08:34.116> calendars<01:08:35.178> and<01:08:35.516> saying<01:08:36.047> like,<01:08:36.289> this<01:08:36.466> is<01:08:36.562> a<01:08:36.691> real<01:08:36.933> thing.

01:08:37.737 --> 01:08:46.889
I<01:08:37.753> mean,<01:08:38.461> we<01:08:38.558> don't—<01:08:39.282> I<01:08:39.363> think<01:08:39.588> Josh<01:08:39.846> gets<01:08:41.117> credit,<01:08:41.455> don't<01:08:41.616> get<01:08:41.777> me<01:08:41.922> wrong,<01:08:42.959> but<01:08:43.056> him<01:08:43.316> selling<01:08:43.949> Omniture<01:08:44.371> for<01:08:44.518> what<01:08:44.631> he<01:08:44.696> sold<01:08:45.005> it<01:08:45.086> for,<01:08:45.248> proving<01:08:45.654> you<01:08:45.703> can<01:08:45.752> get<01:08:45.914> a<01:08:45.930> Silicon<01:08:46.320> Valley<01:08:46.645> exit.

01:08:47.445 --> 01:08:55.974
Without<01:08:47.926> living<01:08:48.247> in<01:08:48.343> Silicon<01:08:48.744> Valley<01:08:49.145> in<01:08:49.305> 2009,<01:08:50.491> what<01:08:50.732> Amateurs<01:08:51.293> done<01:08:51.549> to<01:08:51.725> the<01:08:51.886> Adobe<01:08:52.271> business<01:08:52.591> since<01:08:52.976> then,<01:08:54.098> and<01:08:54.178> then<01:08:54.355> doing<01:08:54.675> it<01:08:54.755> again<01:08:55.477> with<01:08:55.701> Domo.

01:08:56.663 --> 01:09:05.031
It's<01:08:56.839> just<01:08:57.865> unbelievable<01:08:58.587> what,<01:08:59.003> what<01:08:59.228> that<01:08:59.404> guy—<01:08:59.949> and<01:09:00.206> he<01:09:00.366> created<01:09:00.847> the—<01:09:01.152> he<01:09:01.312> coined<01:09:01.568> the<01:09:01.648> term<01:09:01.969> Silicon<01:09:02.370> Slopes,<01:09:03.412> put<01:09:03.572> all<01:09:03.716> the<01:09:03.877> energy<01:09:04.197> and<01:09:04.294> money<01:09:04.534> behind<01:09:04.951> it.

01:09:05.095 --> 01:09:07.516
Man,<01:09:05.336> the<01:09:05.416> guy<01:09:05.656> deserves<01:09:06.634> a<01:09:06.698> statue,<01:09:07.323> right?

01:09:07.564 --> 01:09:09.071
But<01:09:07.644> the<01:09:07.740> Adobe<01:09:08.141> building<01:09:08.542> is<01:09:08.702> good<01:09:08.798> enough.

01:09:09.247 --> 01:09:09.904
That's<01:09:09.423> a<01:09:09.487> good<01:09:09.600> enough<01:09:09.760> statue.

01:09:09.984 --> 01:09:12.998
He<01:09:10.065> probably<01:09:10.385> had—<01:09:10.642> he<01:09:10.770> probably<01:09:11.091> has<01:09:11.331> a<01:09:11.411> statue,<01:09:12.004> so<01:09:12.309> he's<01:09:12.726> good.

01:09:13.160 --> 01:09:22.268
But<01:09:14.058> I<01:09:14.298> think<01:09:14.555> the<01:09:14.795> interesting<01:09:15.260> point<01:09:15.501> is,<01:09:15.757> you<01:09:15.838> know,<01:09:16.158> a<01:09:16.319> year<01:09:16.543> ago<01:09:16.960> someone<01:09:17.425> put<01:09:17.521> a<01:09:17.586> flag<01:09:18.003> down<01:09:18.387> in<01:09:18.548> Miami<01:09:19.045> and<01:09:19.189> was<01:09:19.350> like,<01:09:19.863> Silicon<01:09:20.408> Miami,<01:09:21.274> we're<01:09:21.450> coming<01:09:21.851> for<01:09:21.948> you.

01:09:22.332 --> 01:09:23.022
We're<01:09:22.493> Miami.

01:09:23.856 --> 01:09:26.069
And<01:09:23.936> my<01:09:24.241> point<01:09:24.401> is<01:09:24.497> just,<01:09:24.963> yeah,<01:09:25.123> we<01:09:25.219> did<01:09:25.379> the<01:09:25.444> same<01:09:25.861> thing.

01:09:26.823 --> 01:09:30.142
The<01:09:26.903> guy<01:09:27.127> was<01:09:27.304> Josh<01:09:28.026> and<01:09:28.170> it<01:09:28.250> was<01:09:28.410> the<01:09:28.491> year<01:09:28.667> 2005<01:09:29.565> or<01:09:29.645> '06.

01:09:30.832 --> 01:09:39.219
So<01:09:30.992> we're<01:09:31.217> like,<01:09:32.355> we've<01:09:32.564> had<01:09:32.740> 15<01:09:33.462> years<01:09:34.119> of<01:09:35.146> building<01:09:35.563> Silicon<01:09:36.044> Slopes<01:09:37.231> and<01:09:37.343> they're<01:09:37.631> literally<01:09:38.064> starting<01:09:38.530> from<01:09:38.706> scratch.

01:09:39.829 --> 01:09:44.079
So<01:09:39.989> it's<01:09:40.214> just<01:09:40.438> going<01:09:40.615> to<01:09:40.679> take<01:09:40.919> some<01:09:41.160> time<01:09:41.641> for<01:09:41.978> these<01:09:42.202> other<01:09:42.443> markets<01:09:43.020> to<01:09:43.181> get<01:09:43.341> their<01:09:43.502> stride.

01:09:44.544 --> 01:09:46.998
I'm<01:09:44.624> not<01:09:44.801> saying<01:09:45.186> the<01:09:45.266> Midwest<01:09:45.747> can't<01:09:45.972> be<01:09:46.052> an<01:09:46.148> interesting<01:09:46.629> place.

01:09:47.046 --> 01:09:49.180
I'm<01:09:47.191> not<01:09:47.367> saying<01:09:47.592> Miami<01:09:48.073> won't<01:09:48.313> be<01:09:48.394> a<01:09:48.458> great<01:09:48.714> market.

01:09:49.757 --> 01:09:55.627
It<01:09:49.998> will,<01:09:50.944> but<01:09:51.040> there's<01:09:51.201> a<01:09:51.217> natural<01:09:51.826> course<01:09:52.628> to<01:09:52.788> turning<01:09:53.270> into<01:09:53.606> a<01:09:53.687> whole<01:09:53.927> ecosystem<01:09:54.649> and<01:09:54.745> it<01:09:54.874> takes<01:09:55.194> time.

01:09:55.756 --> 01:09:59.798
And<01:09:56.558> we<01:09:56.718> planted<01:09:57.055> the<01:09:57.135> flag<01:09:57.472> and<01:09:57.536> started<01:09:57.921> building<01:09:58.338> 15,<01:09:58.659> 16<01:09:59.060> years<01:09:59.365> ago<01:09:59.685> here.

01:10:00.888 --> 01:10:07.785
You<01:10:00.985> could<01:10:01.129> argue<01:10:01.466> VSpring<01:10:02.027> before<01:10:02.428> that,<01:10:02.733> and<01:10:02.813> you<01:10:02.974> could<01:10:03.070> argue,<01:10:04.096> you<01:10:04.176> know,<01:10:04.433> Wasatch<01:10:04.914> Venture<01:10:05.299> Fund<01:10:06.101> and<01:10:06.197> Utah<01:10:06.582> Ventures<01:10:06.999> before<01:10:07.384> that.

01:10:08.363 --> 01:10:20.378
Like<01:10:08.523> a<01:10:08.539> lot<01:10:08.860> of<01:10:09.004> people<01:10:09.341> have<01:10:09.550> been<01:10:09.710> at<01:10:09.967> this,<01:10:10.208> the<01:10:10.352> Wayne<01:10:10.609> Brown<01:10:10.994> Institute,<01:10:12.213> um,<01:10:12.758> all<01:10:12.935> the<01:10:13.095> iterations<01:10:13.881> of<01:10:13.977> the<01:10:14.058> life<01:10:14.362> science<01:10:14.715> associations<01:10:15.886> and<01:10:15.983> the<01:10:16.063> tech<01:10:16.384> associations<01:10:17.330> that<01:10:17.410> existed<01:10:17.892> for<01:10:18.052> all<01:10:18.148> these<01:10:18.389> years,<01:10:18.790> the<01:10:18.870> Mountain<01:10:19.271> West<01:10:19.512> Capital<01:10:19.993> Group.

01:10:20.859 --> 01:10:31.543
It's<01:10:21.036> the<01:10:21.196> combination<01:10:21.998> of<01:10:22.303> all<01:10:22.544> those<01:10:22.800> things,<01:10:23.763> most<01:10:24.148> of<01:10:24.308> which<01:10:24.501> are<01:10:24.629> 20+<01:10:25.351> years<01:10:25.672> old,<01:10:26.634> that<01:10:26.730> are<01:10:26.811> finally<01:10:27.292> resulting<01:10:27.917> in<01:10:27.998> all<01:10:28.094> the<01:10:28.399> obvious<01:10:29.056> outcomes<01:10:29.602> you<01:10:29.698> see<01:10:30.019> now<01:10:30.260> that<01:10:30.404> everyone<01:10:30.741> could<01:10:30.885> point<01:10:31.238> to.

01:10:32.249 --> 01:10:34.799
But<01:10:32.345> this<01:10:32.570> has<01:10:32.746> been<01:10:33.628> decades<01:10:34.270> in<01:10:34.350> the<01:10:34.495> building.

01:10:35.008 --> 01:10:39.536
I'm<01:10:35.458> sure<01:10:35.634> if<01:10:35.731> you<01:10:35.859> were<01:10:35.955> talking<01:10:36.276> to<01:10:36.373> the<01:10:36.517> early<01:10:36.838> WordPerfect<01:10:37.481> folks,<01:10:37.802> they'd<01:10:37.962> be<01:10:38.123> saying<01:10:38.444> some<01:10:38.605> of<01:10:38.669> these<01:10:38.765> same<01:10:39.167> things.

01:10:40.275 --> 01:10:47.725
You<01:10:40.355> know,<01:10:40.515> if<01:10:40.612> you<01:10:40.692> went<01:10:40.853> to<01:10:40.933> the<01:10:41.174> SNET<01:10:41.639> team<01:10:41.977> and<01:10:42.137> said,<01:10:42.442> tell<01:10:42.619> us<01:10:42.763> about<01:10:42.940> the<01:10:43.662> Utah<01:10:43.984> ecosystem<01:10:44.465> 25<01:10:45.011> years<01:10:45.252> ago,<01:10:46.215> you'd<01:10:46.312> have<01:10:46.472> a<01:10:46.553> bunch<01:10:46.729> of<01:10:46.874> interesting<01:10:47.339> content.

01:10:48.720 --> 01:10:59.896
And<01:10:48.865> so<01:10:49.363> the<01:10:49.523> idea<01:10:49.908> that<01:10:50.888> Miami<01:10:51.289> is<01:10:51.434> the<01:10:51.466> new<01:10:51.691> place<01:10:52.092> and<01:10:52.189> it<01:10:52.253> started<01:10:52.638> 1<01:10:52.815> year<01:10:53.040> ago<01:10:54.099> seems<01:10:54.485> kind<01:10:54.645> of<01:10:54.677> silly<01:10:55.127> when<01:10:55.368> you<01:10:55.544> look<01:10:55.849> at<01:10:56.411> how<01:10:56.524> much<01:10:56.893> work<01:10:57.455> it's<01:10:57.616> really<01:10:57.953> taken<01:10:58.274> to<01:10:58.418> get<01:10:58.740> Utah<01:10:58.997> to<01:10:59.141> where<01:10:59.302> it's<01:10:59.462> at<01:10:59.623> today.

01:11:00.707 --> 01:11:01.760
Yeah,<01:11:00.885> I<01:11:01.047> totally<01:11:01.419> agree.

01:11:02.343 --> 01:11:03.509
Jeff,<01:11:02.667> we<01:11:02.748> need<01:11:02.845> to<01:11:02.893> have<01:11:03.055> you<01:11:03.088> back<01:11:03.379> on.

01:11:03.557 --> 01:11:04.513
You<01:11:03.638> and<01:11:03.736> I<01:11:03.865> could<01:11:03.962> talk<01:11:04.205> forever.

01:11:04.594 --> 01:11:08.902
I<01:11:04.756> want<01:11:04.870> to<01:11:04.934> talk<01:11:05.112> to<01:11:05.161> you<01:11:05.242> about<01:11:05.355> marketing<01:11:06.084> and<01:11:06.635> how<01:11:06.797> to<01:11:06.878> build<01:11:07.137> a<01:11:07.202> brand,<01:11:07.510> all<01:11:07.542> that<01:11:07.688> type<01:11:07.769> of<01:11:07.931> stuff,<01:11:08.158> which<01:11:08.255> we<01:11:08.336> didn't<01:11:08.498> even<01:11:08.660> get<01:11:08.790> to.

01:11:08.983 --> 01:11:11.323
But<01:11:09.693> I<01:11:10.435> appreciate<01:11:10.984> you,<01:11:11.033> man.

01:11:11.404 --> 01:11:12.340
Thanks<01:11:11.646> for<01:11:11.726> everything<01:11:12.033> you're<01:11:12.130> doing.

01:11:12.469 --> 01:11:15.018
Appreciate<01:11:14.534> you,<01:11:14.631> Clint.

01:11:15.099 --> 01:11:18.084
Thanks<01:11:15.341> for<01:11:15.761> building<01:11:16.067> up<01:11:16.245> this,<01:11:16.809> this<01:11:16.890> silicone<01:11:17.455> ecosystem.

01:11:18.181 --> 01:11:18.915
We<01:11:18.280> appreciate<01:11:18.832> it.

01:11:18.999 --> 01:11:19.835
And<01:11:19.183> thanks<01:11:19.350> for<01:11:19.451> having<01:11:19.752> me.

```