Rob Petrozzo Transcript
Clint Betts
Rob, thank you so much for coming on the show, it means a lot to have you here. You are the chief product officer and co-founder of Rally, tell us about Rally and how you became and got to where you are today.
Rob Petrozzo
Yeah, Clint, thank you for having me, dude. I appreciate it, man. I mean, listen, long story short, we created Rally for ourselves, myself, and my co-founders of start. So the short answer is, what is it? It's kind of a stock market for collectibles. So we take everything that gets a lot of people excited and has created value for the wealthy over time, and we fractionalize it and turn it into stock. So it's everything from dinosaur fossils to classic cars where we started, to Warhol paintings, to game-worn Michael Jordan sneakers. It's all of these really important collectibles that, in our mind, belong in a museum, but they also belong to community-owned. So it's almost the ability to invest in the things that you really love. We've been working on that independently, with my co-founders, Chris and Max, as friends for a long time in the asset classes and the collectible spaces that we loved.
For me, it was always a mix of art and sneakers. For Chris, it was cars. For Max, it was baseball cards. It was something that we knew that the most exciting museum-quality examples of the things that we loved were living somewhere, but it was probably in some really, really wealthy person's storage locker somewhere. So in our mind, if we could take those things, bring them to life, and make them accessible to everybody, we could have a business that fulfilled our own wants and needs, but also millions of individuals who really care about these items but they're kind of stuck behind the velvet rope.
Clint Betts
How did you actually figure out the whole financial system for this? How would this actually work? Did you just look at Wall Street and different markets like that? How did you figure this out?
Rob Petrozzo
Yeah, I mean, to be honest, we guessed a little bit early on. In 2014, we started talking about this. It was on the heels of crowdfunding, which was kind of taking hold of the collective zeitgeist. Kickstarter, Indiegogo, and all these platforms, some for real estate were starting to come out and really test the limits of what they could do with an offering with an IPO. The JOBS Act, which was this legislation from 2012, came out, and it was pushed by those companies, such as crowdfunding companies. And it allowed what you would consider regular people, everyday people, to invest in what the government at that point deemed riskier assets. So those are private companies and crowdfunding campaigns. Before that, you needed to be an accredited investor; you needed to have a million dollars in net worth or have made a couple hundred thousand dollars a year over the course of years to kind of prove to the government that you were a sophisticated investor.
But for us, we always looked at ourselves as potential sophisticated investors. We didn't have the money, but we had the knowledge base. And I think that that was the big unlock for us. Robinhood, at that point, was starting to gain some traction; it had the early waitlist version of Robinhood that became the real platform. Coinbase was new, but in 2015, people started to pay more attention to crypto. You had all these mobile-first platforms coming out, and they were engaging millions of people really quickly because of the democratization of finance that was happening all around us. The last category that was left was collectibles and alternative assets, and that was something that we had a very, very unique view of individually; all of us were collectors in some capacity.
But you never had access to the best stuff. So we would go to auctions and go to Barrett-Jackson at this big car auction in Arizona; we pop in there and kind of get a feel for the room. You had a hundred thousand people show up at these events; they're all behind a velvet rope, and you have four or five people bidding on individual items. And that to us was just this aha moment where it was like, "Listen, we know this stuff probably better than some of these owners, we have no access to it, there's no way to get the museum quality stuff, there's no way to add it to a portfolio. The regular investor is stuck buying whatever's left over." And by the time it trickles down to someone like me, early on back then, if I wanted a comic book or a card or want to buy a watch, I'm getting whatever's left over. I'm not getting that from the source; I'm cutting through 5, 6, 7 different middlemen before I get there, and whatever's left is mine.
So now that we had the JOBS Act in place and you had non-accredited investors can make investments, you have the structure to kind of turn things into companies, which we sat down, talked to lawyers about, and realized it was possible. And we had this domain expertise ourselves in these individual asset classes; it was like, "All right, we could maybe make this a business." And then we started putting thoughts on paper, building the demo out, and all of a sudden, you look down, and you're like, "Damn, dude, I think we have a business here." And that led to a lot of better conversations with potential investors, VCs, and early users. And then, as life often does, seven years pass, and now it's something that's a little bit bigger than we expected, but also something that definitely is super rewarding to be able to see where it came from, having built that from that one concept seven, eight years ago.
Clint Betts
Yeah, it's huge; it's an incredible product you've built, too, which I want to talk about here in a second. But at the beginning, when you are thinking about raising money, talking to investors, talking to venture capitalists, and all this type of stuff, what was that process like? What did you learn from it? What advice would you have for people who are going through that?
Rob Petrozzo
Yeah. I mean, listen, everybody tells the story of how many doors close and how many nos you got along the way. We got 400 nos or whatever it was early on, and I think there were two parts of it. This was in 2015 and 2016 when we first started to raise money. And we were going in very cold, finding people's emails and DMing people on Twitter. Luckily, VC, in general, I'll say, for all the bad things that people will say about venture capitalists and the greed element, and they're not really your friends, and all the things that are probably true, for the most part. Even the biggest VCs, the ones who have a name and who you can Google and find out are in your industry, are always really receptive to the cold pitch. And we started with Twitter DMs, and we started with a very... What I thought was a really pretty deck, but it didn't have a lot of substance, which explained what the market opportunity was.
That opened a couple of doors, but there were still a bunch of nos. Some of the nos that we got early on were just, "It's not too small right now; let me know when you have some data." A couple was a little rougher, where there was one billionaire, a well-known tech billionaire in particular, who we got on an email chain with him, his financial advisor, and myself and my co-founders. We said the pitch, and he sounded like he was interested, and then it kind of got circumvented by the business manager who stepped in and said, "This is a big no for us, and if you want to know why, you should read chapter six of my book." He also linked us to Amazon for a book that he wrote. And those things along the way are always going to be a little bit of a knockdown. But what we realized coming out of that process, the early process of trying to use the idea as the hook, was that we needed something tangible.
So, we built a demo. And it was mostly a puppet show; it was a little bit fake, and it linked into what would be a backend in the future. But it was a version of Rally with a few cars and a carousel that you can click through, see all the details, see the price mechanism and some charts that speak to provenance, detail, and authenticity, and then make an investment with the equivalent of probably 10 or 11 clicks start to finish. And I think putting that in the hands of a few of the people who were receptive early on was what put us over the edge. Those people didn't necessarily invest, but they made introductions to people who had significant domain expertise in the marketplace, in consumers, in collectibles, or in auction houses. Having that sort of feedback in hand on a phone where they can click through it was invaluable for the product, but also in terms of letting them know it's not just an idea; it's real.
And I think that's always... Any advice I give to any new entrepreneur or someone, especially starting a digital product or anyone doing hardware, is that everybody is receptive to emotion. Whether a sophisticated investor or a VC, they're always going to say, "Take the emotion out of investing." They're lying; everybody looks at something. When they see something or touch something, it has that haptic response, and they can click through from start to finish and feel it in real life. There's an immediate reaction; you can see it in their face whether they like it or not. And they're halfway there to making that investment if they can really see it and understand it in real life, and that's always what we kind of focused on going forward from that point.
Clint Betts
Did you read the chapter?
Rob Petrozzo
No, I look at that email every now and then, man. Once every five or six months, I'm in the doldrums, I look back, and I'm like, "This guy really told me to buy his book." And it's like, "What?" And now that particular person who we were pitching, I'll see pop up on TV or something every now and then, just like, "Man, I really want to connect with this guy and ask if he's still working with that business manager." But I never read the book, no.
Clint Betts
That's hilarious. It's hilarious he wouldn't send you a copy of the book, he actually wanted you to buy it, that's great.
Rob Petrozzo
Nah, I mean, listen, anything that's worth doing, if it's good enough, you should charge for it. I'll give him credit for that; send me the link and send it to Amazon. But yeah, I don't know, he didn't get his residuals off my purchase, that's for sure.
Clint Betts
That's awesome. Tell me about building the product because you've really built a unique, fascinating product. What do you think about... And you are the chief product officer, obviously, so what do you think about building products, and what is your process like?
Rob Petrozzo
Yeah, my process has always been a little bit different than what I would consider the Ivy League product managers and product designers who really want to start with a bare-bones wireframe, through the research process, through a discovery phase with new users, to onboarding in small batches, A/B testing and then releasing pieces. I've always taken shortcuts for better or worse, personally, and from a product perspective, I've tried to lead with intuition. I think the business that we're in, that we have to find collectibles that people love, that we have to syndicate them to thousands of people, that we have to tell stories effectively, that to me was always a mix of intuition and taste. And I think that's the one thing that the PM who runs products now at most startups and most companies, especially bigger companies and giant organizations, you're not going to get away with just having tastes or just having a feel.
But early on, I think when we started putting thoughts on paper, it was going to be sort of a finance app, but we wanted it to look and feel way more like a consumer experience and more like buying a pair of sneakers on GOAT or anywhere in a marketplace that wasn't about finance. So we did a lot of competitive analysis early on and did the brand twin exercise, which really focused on the brand as the pillar. But a lot of it was initial sketches; I skipped straight to the pixel-perfect designs at that point. And this was in an era when Photoshop and a few other platforms that are no longer... Figma runs product design at this point. But at a time when it was really about the visuals. And we looked at two apps at the time that made a lot of sense to me in terms of consumer experience.
One was a company called Stocktwits, whose founder wound up being our first investor. It's a forum-style communication tool for people in finance to talk about individual stocks and add sentiment, and it's a very much timeline feature. The second was an app called Maple, which was by David Chang. It was a food delivery app. It was in a couple of markets here in New York; it was really about telling the story behind the ingredients and why they put this dish together. They had only five or six individual items on a menu any given night, and it was all kind of sourced in a really interesting way that it told the story. And it was this really nice paginated experience.
Those two pieces kind of blended together. I took the best parts of both and designed the first product page for our products and our individual collectibles. That told the story effectively, allowed for a little bit of communication with us and other individual users, and kind of told the whole story. But we pushed the buy, the idea of investing all the way to the back because we were trying to flip it on its head. Everything at that point, because of Robinhood more than anybody else when we launched, was about making the investing experience seamless. And it took a lot of the heart and the soul out of investing; it became to get in as quickly as possible, a very binary outcome.
Finance, in general, is a zero-sum game; it's always about making as much money as possible and getting out. And we knew that wasn't going to exist; that was a race to the bottom for us. So we looked at it and said, "Let's just flip it. We'll turn it into a product that looks and feels more like a magazine." Has the elements of those two products that I spoke about, tells a story effectively, and the button says explore. And the deeper you get into the product, the more it becomes... Some of the imagery strips out, and then you get to a point where you can make a purchase and invest in any of these individual assets. But that's six clicks away from the front page, from the initial experience, which is the worst thing that anybody could do in a transactional app, is make it so they have to go find the place to purchase something.
But that, for us, wound up being the magic early on because we weren't trying to push people into an investment; we were trying to lay out as much information in the most interesting, visually appealing way as possible and answer some of your questions to reinforce your intuition, and then you can make the purchase. So we kind of developed the product knowing that that was going to be the archetype who we were going after with the same thought process. Make it as interesting visually as possible, and give them the opportunity to explore and go deeper into the product. But by the time they get to the purchase decision, we're probably going to be able to capture the majority of those potential investors because they've gotten this far with us.
Clint Betts
Today, Robinhood's probably something like OpenAI or ChatGPT; how are you thinking about AI and integrating that into your platform?
Rob Petrozzo
I think that, again, going back to the common theme that we've always had here, we want to reinforce intuition. You want people to have a well-formed investment thesis by the time they get to Rally, but then you want them to sort of get in and maybe see something, some wrinkle they didn't know existed before making that purchase. That kind of says, "All right, I was right, I'm directionally correct, and here are the details to fill in those blanks that I didn't have." For me, that's how I use AI right now; that's how I want it to be in our product, and I think at a certain point, we'll have no choice but to integrate it into the process. But I've never thought about AI, and I've never wanted AI to be a creative crutch. I think that a lot of what we see right now is visuals and imagery, and it's thesis papers, and it's
kind of pumping out a bunch of articles. To me, that's a little bit you see it, and it feels a little bit soulless, and I think I've never wanted that to be the way it integrates into Rally or into my life. I wanted to pick up on the things that A, I just can't find or B, don't want to do. And I think that deep research that goes along with so many of these individual assets, not the storytelling part, but the actual nuts and bolts of the way something is made, a little bit of nuance around the authenticity mark of the provenance, around an individual asset. I think having those along with some of the price action and being able to get some predictive analytics that you can apply to your investment thesis or fill in some of those blanks on data that maybe might've escaped you or us in that process because it's either super new, maybe it's super old, or maybe it got lost along the way but AI can kind of fill in those blanks and create that bridge I think is going to be a really interesting part of the way it works in finance.
Because right now, so much of AI, when I see it, and I see the way friends use it, it's like, "Give me a winning parlay for six teams tonight in the AL and the NL in baseball." And to me, it's a very front-of-house way to do it. And then the other side is, "Make a pretty picture of a kid in a field playing with a kite." And it spits out something that has seven fingers on it or something crazy. There's somewhere in between that feels a lot more like application to my knowledge base right now and expanding my knowledge base on something that I know 80% about; give me the other 20%. That's where I see it fitting into our product, and that's how I'm trying to use it more every day.
Clint Betts
What does a typical day look like for you? How do you decide where to spend your time?
Rob Petrozzo
Yeah. I mean, I wake up, I think about every single regret in my entire life, and that's 30 to 40 minutes to start the day. But then I get to it. Do you know what I mean? I'm hitting these streets; I'm trying to take in as much of what's going on around me as possible and trying to start the day creatively. I think I've tried to do more where... Our product right now lives in a place that is super useful for the people who use it every day, and I think that as humans, we tend to get lost in our routines and in our ceremonies, and it has to get changed up every now and then. So for me, on a regular day, after going through all the regrets, I'm sitting down, I'm going through some email, but I'm really thinking about the product and the pieces that are missing right now, not for a week from now or two weeks from now, but trying to think about the big picture.
I'll sketch some stuff out, I'll throw some ideas on paper, and I'll share that with some of our product team, usually probably around midday. And then the majority of what I'm trying to do for the rest of these days is really sort of work on relationships. And that's something that for three, four years when we were putting this business together, so much of it was hammer and nail. It was find some assets, get some demand pulls going, make sure we're pushing this across content, that we're doing enough to make sure people know who we are, what we have, and how to get your hands on these individual assets and shares of those assets.
And now it's about sort of scaling the business. I think that we've been lucky in that a lot of people have invested in our company, and a lot of individual investors have come in and invested in assets. They know that we're here for the long term, and if they look at it like it's not that flash in the pan two years, three years, everyone makes a ton of money, we sell the business and get out. They see it as something that's developing, not just for Rally as a platform but for these relatively new asset classes.
So, a lot of what my day's been is thinking about how we scale this business. Whether it's talking to individual sports leagues or it's talking to asset owners or auction houses, thinking about a way that we can acquire, and having the conversations for the best way that we can acquire assets, that we can make money on those assets for our investors, for ourselves, for the business. Then, exit those assets when the time is right and do all of that with the right people. And this is an industry, considering that we're in 23, 24 different categories right now, it's got so many different players, and a lot of those relationships we've been forging for the better part of five or six years. And they're at a point now that the cream has risen to the top, and the people that are going to be around are still here.
Those are the conversations I'm trying to have for the bulk of the middle of each day, and those are the ones that I think don't necessarily pay dividends right now, but in the future, they'll be incredibly impactful and meaningful for our user base, for our investors, and for the future of this platform. That's what a lot of my focus has been outside of: trying to make sure that I'm doing as much design and getting as many thoughts on paper so I don't lose that edge. Because man, I'm getting a little bit older now, and I see these young kids now, these 18, 19-year-olds, 20-year-olds, they're running circles around me when it comes to the actual design, so I can't lose that. I'm trying to do as much of that as possible early in the day when my brain is still firing.
Clint Betts
Yeah. And what is your relationship like with the leagues, and how did you build that relationship?
Rob Petrozzo
I mean, we got lucky. Early on, when the platform started growing, the asset class that worked best for us and the one that generated the most interest, generated the biggest returns, and got the most investors involved was in the sports category because it's a huge pool with massive fandom, and then a lot of collectibility that goes with it in a bunch of different places. So whether it's trading cards, or game-worn memorabilia, or tickets, or it's IP. Right now, when Top Shot came out, when NBA Top Shot came out, that kind of changed the dynamic around what IP actually is and what it means in the future. It had the attention of the collected masses of retail, institutions, and these massive leagues that wanted to foster a relationship with all of those people. So, when we were raising our Series B, we immediately started thinking about what leagues we could talk to. We got a bunch of athletes involved in the NBA and in Major League Baseball. MLB as an organization came in and was part of that round as well.
So it's always been when the time is right, let's talk about doing something together. And I think that that was to us started over the course of the last year, and we've gotten way more focused as game-worn memorabilia has taken off as we and our relationships with athletes and individuals who love sports and the fans of sports have grown. The assets on the platform that matter most are the ones that matter most to fans as well. And I think that for us, we've gone to each of these leagues individually, and we've talked about what it could be to sort of open up access to fans in a more meaningful way to the past and to the future. So we've started talking to a few people about what that looks like, and it's likely... The way I hope to see it in the future is that right now, I'm in our museum space here in SoHo, which is a physical space, has a bunch of our stuff on display, and it's open during the weekends, and we have a little coffee shop in the front.
I would love to take this and have it be a carve-out in a stadium at some point or in arenas. And you see, now, when sports gambling became less of a faux pas and was not just accepted by everybody but also integrated with the leagues, that was a pretty obvious moment for me. In that every fan is a speculator in some capacity, every fan cares about having them put their money where their mouth is. There's a way to do that with gambling, and there's a way to do that with investing. And I see this as not just a compliment to what the leagues and what teams are doing right now, but as a way to grow fandom and to sort of have something where...
When people walk into this museum, I see it all the time, and they own assets, they own shares in any of these assets. They're with their family, they're telling them all about it, they're saying when they bought it, they're talking through the history of the individual item. To be able to do that in a stadium or in an arena for a team that you follow generationally for your entire family, and it's been passed down to you, I think, is a really important unlock. We've seen it a little bit in kind of fantasy sports and gambling parlors in individual stadiums worldwide. And I think the next step for that is collectibles, and the idea of Yankees having Monument Park and also having the space where there's a bunch of collectibles that you can invest in on the spot or that you own shares in when you go to that game is where I want to see this going.
Clint Betts
What do you know now that you wish you would've known at the beginning of your career?
Rob Petrozzo
Oh, man, there are a lot of different ways to get the money. I think that is the big one. We immediately went for VC money. Some of it's been good, and some of it's been bad, but for the most part, relationships are great. But in reality, I see a lot of people who've bootstrapped from start to finish at this point; for us, it probably wasn't an option. But there's much more to be said, and we're starting to see it now in having independence and not being beholden to somebody else's view of your product. As much conviction as I've always had about this business and about what we've built, I'm not impervious to other people's opinions. And especially when someone's giving you 10, or 15, or 20 million dollars, it's kind of the conversation starts, and their opinion is right.
There's no world where I'm telling them, "Nah, get out of my face; you're wrong." You have to listen to it. I'm a bad listener at times; when someone talks to me and tells me what I should be doing and what I shouldn't be doing, I'm immediately on defense. That happens all the time in my regular life, my personal life, and my work life. But when someone's giving you money, I think that I'm always way more open to what they're telling me, as it kind of should be and as I expect from some of the investments that I have in other platforms, and other companies, and other products. But I think I would've probably stuck to my guns a little bit more along the way with a couple of bumpy spots in the trajectory of this business.
And I think that for new entrepreneurs, it's almost cooler to be independent. It feels way more impactful and way more accomplished when you've raised no money; you've grown a business to 20 or 30 million dollars. In the VC world, that's such a small amount of money and such a small potential exit. But when you own 100% of that business, that's a massive, massive opportunity, really built it from scratch. I think early on; I probably would've explored maybe skipping a round or two more than anything else, but also alternative financing methods or thinking about starting smaller and not having to accelerate immediately, which would've allowed us to think a little bit differently about the way we raise money.
Clint Betts
What are you reading, or what reading recommendations do you have for us?
Rob Petrozzo
Man, I don't read enough. What I've been doing more of... I took off from podcasts for a while, and then I started reading a little bit more, and now I've gone back to podcasts again. I think that when you're in tech, you get caught up in a lot of the Malcolm Gladwell-esque kind of mix of self-help and business, and you're trying to pull little idioms and analogies out of those individual books that talk on podcasts and have conversations like that as well. But for me, I'm trying to think more about what we've built and the nostalgia that goes with it. I started reading old Goosebumps books again because they're all over our office. And that to me is this nostalgia, but it's also when we bought them for this company, for the museum that we're in right now, all of a sudden they were... It was $1,200 for all 63 editions of that.
And I'm thinking in my head it goes back to the Scholastic Book Fair days, and it goes back to summer reading. And it's these things that now we're on this cycle where Gen Z and Generation Alpha are so in tune with what happened in the nineties and the two thousand, there were all these things around that I kind of missed early on. It's not just Catcher in the Rye type stuff; it is these weird little Goosebumpy type of books that are 75 pages that are written in such a unique way. You look at it now, and I realize it tells the future. It's the same movies, the same IP that's getting rehashed right now, and that, to me, is what I've been doing just from a business perspective to better understand what was going on in the nineties and the early 2000s because I forgot so much of it at this point. And there was so much cultural currency in those individual titles and the things that I think, as someone who kind of grew up and came of age in the nineties, took completely for granted.
Now, when I walk around SoHo and see 18-year-olds dressed the same way I was dressed in 2005, it's crazy to me. But I'm trying to read and take as much of that culture back in right now so I don't lose it because if you don't pay attention to the past, you're going to have no idea what's happening in the future. And that window right now of what matters and the cultural currency that matters is this really tight timeframe from the late nineties and early two thousands, so I've been trying to pay attention way more to that.
Clint Betts
What have you learned about the power of nostalgia?
Rob Petrozzo
There are two parts to it, man. Nostalgia could be fantastic, and it opens up these parts of your brain that you kind of forgot existed, but it can also be toxic, and I'm trying to avoid that toxic nostalgia. And when I say toxic nostalgia, it's more about implanting these moments that never actually happened or weren't as good as they kind of seem. It's one of those things where a memory is only surface-related to the last time you remembered it. For me to remember what happened when I was three or four years old right now, I have little flashes of it, but I don't remember anything in real detail from before I was 17 or 18 years old other than little moments.
But when I think about Christmas Eve at my aunt's house who was two doors down from my apartment, or when I think about what was happening in high school, and certain moments, and certain things that I bought with my own money for the first time, I think about nostalgia as a way of reconnecting with good times, but I want to make sure I don't get lost in it. And the business that we're in with Rally, it's really easy to get lost in nostalgia and make up an entire story about something that happened in 1997 that probably never even happened, and now I'm chasing that moment in my real life. And I'm trying to do a little bit less deep nostalgia dives and do a little bit more use it as a little bit of a platform to get to the future, but sparingly because I don't want to get lost in a time that's never going to be recreated.
Clint Betts
What are some products, apps, or tools that you have to use every day that are integral to your daily life?
Rob Petrozzo
Yeah. I've gone way back to analog, so I'm at a point now where I'm not wearing a watch today, and I feel absolutely naked right now. I forgot to put a watch on walking out the door. And that to me has always been this mix of I want to show people the things that I care about, but also I want to stay back in an analog world because I can't even pay attention to everything; it's so digital at this point. But outside of that, I've gotten to... As horrible as a phone is to have on you at all times, I do start and end my day, and everything in between when it comes to everything from video editing to emails; all of it has gotten so comfy on my phone at this point. I'm trying to get further away from it now. On a day-to-day basis, we have digital timers that I keep in the office that are really well-designed and pretty from the MoMA Store that count down 20 and 30 minutes at a time, so you can get relentless focus. I use that on a day-to-day basis.
I'm still very, very deep in Photoshop. I think that for me, the ability to edit and do it in a non-angular kind of freeform way will probably make me one of the dinosaurs that are using the Creative Suite forever into the future. But that's a must; there's never a day that Photoshop doesn't get opened on my computer, on my phone, or somewhere in between. And then, in terms of getting from point A to point B, I've also gone back a little bit analog, and I'm just taking Citi Bikes everywhere lately. I've kind of tried to sunset Uber from my life, and I've taken the train less; I'm trying to sort of be... Now that we have a little bit better weather in New York, that's been my day-to-day, and the way that that system works in New York has always been really interesting to me, the Citi Bike system in New York.
And the way that it hasn't somehow... It's avoided, knock on wood, what happened with Bird and Lime scooters, where they just became a disaster in every city, and you wind up seeing them thrown in the garbage and set on fire, and the docks never work. That's a system that's been really interesting to see come together in New York and, over the course of half a decade at this point, to be as relevant as it still is. That's the one piece of technology that is this mix of analog and digital, and that's always really... I've always paid attention to it, but I've been using it way more often lately.
Clint Betts
What role has New York City played in your whole journey and in the journey of the company?
Rob Petrozzo
Yeah, I mean, it's all of it. To me, it's such a New York-centric thing to say, "This is the greatest place in the world." But it's really hard...
Clint Betts
It is.
Rob Petrozzo
It absolutely is. And it's hard for me coming from Brooklyn, and I live in Manhattan now. Obviously, our business is in Manhattan, and you're in this world where Brooklyn is part of New York City. But when we were younger, it'd always be like, "We're going to the city." That was always the way you said it. And the city just meant Manhattan at that point, and you tell anybody outside of New York, "Yeah, the city." They're like, "What's the city?" "It's the whole thing." It's like, "Yeah, there's 11 million, 12 million people here; it's the whole thing and includes Brooklyn." But this, to me, is this aspirational thing that I've come to appreciate more over the course of the last probably five to 10 years, especially in starting this business. When we launched, in my mind, it was the taste level, curation, and density of the population and things that people care about that we needed to represent on Rally. And that, to me, was a direct representation of New York.
So when we launched in California... In particular, Northern California became our biggest market, and then Los Angeles became our second-biggest market, and York was third. To me, it was almost not a failure, but I was like, "How do we not have 10,000 users from New York knocking the door down right now? We built this in this city for this city." My co-founders and I are from this city. Me and Chris, my CEO and my original co-founder, are from Brooklyn. All of our friends are from Brooklyn and parts of Manhattan; how is this not something that's winning in New York? And you realize that what we've done here is mimicking what the city has built in a lot of different cities. But it's kind of New York that goes everywhere, and that's anywhere you are. You're going to find somebody from New York, and you're going to have a conversation about New York.
It's going to be about New York versus Paris; if you're from Paris, it's going to be that fight. It's going to be New York versus Berlin if you're talking to them. It's a creative outlet; it's a place where you could walk outside and see all the things that we have on this platform; you'll see them one way or another. You'll see a Lamborghini drive down the street randomly; you'll see somebody at a restaurant that has a hundred-thousand-dollar watch on. You could see these things everywhere and anywhere, and that, to me, was always the indicator when we built this platform, what we should put on the platform first.
That's why it was cars, and then it was sports and some trading cards. It's such a massive sports city. It went into watches, wine, handbags, and all these trappings of wealth in New York, and we wanted to sort of knock the door down first here. It was surprising that we got to this one-third, but now we realize it's all part of the idea that New York is everywhere, and the concept of investing in culture and only the things you care about is not New York-centric. As much as I think New Yorkers want it to be, and as much as I want it to be ours, it is something that translates everywhere.
Clint Betts
Yeah, for sure. What advice would you have for entrepreneurs and leaders now that you've been in this game for as long as you have and you've seen some success? What advice would you have?
Rob Petrozzo
Yeah, I'll say I've had so much failure along the way, and I've always kind of embraced it. I think I try and make sure that everybody here understands that too. I do a bad job at times because I let my passion and my temper get the best of me. I've been trying to fight that for almost 40 years. I've been in the workforce for 20 years now, and a lot of what I think about is how to be a little less emotional. But I really have trouble doing it, and I think that that's the biggest thing along the way... Having gotten fired so many times and sort of had projects that just didn't take off the way I wanted them to, you get hit in the head over and over and over again, and you have no choice but to use it as fuel.
I've always kind of enjoyed getting fired. In the last two jobs I had, getting shown in the door was just this freeing moment for me; it's a weight off my shoulders. It's like, "This wasn't the place for me anyway." And I've tried to use that as best I can. But I got fired maybe two jobs ago, this is in 2012 or 2013, and I'm talking to my dad, and he said something that stuck with me that I stole from him, and I use it all the time now. It's like, "Whether you're right or wrong, if you're an asshole, you're wrong. It doesn't matter how good your point is; it doesn't matter how smooth you get it across or how it's articulated." That's the absolute truth; I'm still guilty of it on a weekly basis.
It used to be on a daily basis, but I'm trying to knock that down to a monthly basis and then get that kind of attitude when things don't go your way out of my system entirely. But for a 19 or 20-year-old now who's just getting started, especially as a designer or as somebody who has to take critique, I think being able to understand that someone who's telling you something is wrong or telling you that you didn't do something right is not... Especially in a job, is not telling you their personal belief. It's telling you something that represents the future of the company, the business, or your future; it's just maybe not the right place for you. And any conversation, any deal, any sort of sales cycle you go through where you can't appreciate that... Even when you're right, sometimes you have to take a backseat to the conversation. This is something that I learned the hard way without question, and I'm still working on it. But that to me is something that I don't want to be the guy who's saying, "The next generation, they don't appreciate anything." I don't want to talk about millennials the way the previous generation did because that's not true. These new kids are going to be the most successful generation ever, and they're so creative and on point with the way they think. But I think they've gotten really used to accepting criticism from a distance, and when they get it face to face, it triggers a lot of emotion in them one way or the other. And they want to kind of mobilize and protest against it, literally and figuratively at times, and sometimes it's not the right way to get the point across.
Sometimes, taking that confrontation and turning it into sort of a positive, and thinking about how do I present this conversation in a way where if I need to be around these people or have this conversation again in a year or two years, it's not something where I burned this bridge down? It's an important part of a creative journey and a career journey. I learned that the hard way a bunch of times, so I've always preached to that next generation, "Whether you're right or wrong, again, if you're saying it the wrong way and you're talking crazy, you already lost that battle. It's not worth it."
Clint Betts
How do you think about your mental health and staying grounded? And what do you do throughout the day to make sure that you don't completely lose it given the times we live in?
Rob Petrozzo
I mean, I do sometimes. There are times when it is too rough to handle, and I don't ever want to be like, "Poor me." But there are times when... It's walking away a lot of time. I think what I've done is literally trying to be outside more, trying to change the environment up, and changing the routines. Those ceremonies and the kind of things that you do on a day-to-day basis to ground yourself and that you want to remain consistent with are super important, but changing the scenery literally and figuratively is a super important part of that, too. There are days when working from the office is not the right place to be for that day. There's going to be very hyperfocused work; you want to get rid of all the distractions around you. But also, you want to be in a different mental state because I want to sort of open up my ideas and open up the ability for me to design and create in a way that's different than that standard ceremony, that standard kind of the typical day-to-day.
I think getting away from it... I'm as guilty as any entrepreneur, any CEO, or founder, or whatever, where it's you don't take vacations, every single day is work, there's never a day where the computer doesn't open, there's never a day where emails don't get answered. I kind of expect the same out of a lot of people who are at our company, especially the senior people who I've been with over the course of the last four or five years who know what the expectations are.
But stepping away from it and literally going for that 45-minute walk, where it feels like I'm going to be doing something that's counterproductive, is the only way to be productive. It's conversations like this, too; it's talking to people who are creative in the space that you don't necessarily see on a day-to-day basis, which is a huge part of it, too.
I tried to say yes to more things. Saying no is important too, but I've tried to say yes to more dinners and more events, speaking on more panels, and doing things that put me in a room with a bunch of people I'd never met before or people that I'm not necessarily comfy with to the point that I'm texting them all day or I'm in group chats with them. I think that's an important part from a mental health perspective, too. Because if you're doing the same thing over and over and over again, there are diminishing returns there. It's not going to be something that provides you with what you need to be successful in the future, especially if you're already in a mindset that's a little bit tight or it's a little bit complex at the moment. Getting away from that complexity with new people, new places, or something as simple as taking a walk in the sun for 45 minutes has changed the way that I think about the day on a day-to-day basis.
Clint Betts
Finally, we ask and end our interview with the same question, and that is at CEO.com we believe the chances one gives is just as important as the chances one takes. When you hear that, who gave you a chance to get you to where you are today?
Rob Petrozzo
Yeah, I have two people who have done something I've tried to do more of, especially with young designers. I got out of school, I was a super raw designer, and I was skipping so many steps, which I still do to this day. It's the worst thing you could do as a designer. And I was going straight to the printouts at that point, back in the early two thousands when it was all logos, and package design, and you were literally drawing fonts by hand. I sound like a dinosaur right now, but that's what it actually was.
I had no portfolio, I had a bunch of loose pieces of paper, and I had a couple of things in an email; it was messy. The first person was a guy named John Monopoly, who's Kanye West's manager now. That was my first job out of school, I was doing a bunch of designs for Kanye. And he saw an actual printed piece of material that I had at a print shop in Queens and asked the owner of the place... I was going to pick all this stuff up in a box. And he said, "Who designed this?"
And the owner gave him my number and said, "We're starting this label; I want you to come in and meet a few people." He gave me the first chance, and even to this day, he still asks me for stuff every now and then, including files from 20 years ago, and I make sure he gets his stuff all the time now. He was the first person who allowed me to sort of say, "Listen, here's the budget, here's what we're trying to do, it's a tour for John Legend, or it's whatever it's going to wind up being, throw some ideas together." And that was the first time that I was allowed to sort of think about, not just here's the nail, here's the hammer, just get that done. It was the first person who said, "Do whatever you want, and if it works, you get rewarded for it. If not, we'll go back to the drawing board."
And that was a really important part of my early career. The second was once I got into startups and started working on products, a previous CEO, John Lima, who is somebody that I just talked to and who I reconnected with for the first time a week ago by chance. It was the same situation; I didn't have digital design. I had a lot of physical, tangible design at that point, but he kind of saw something in me. And he's not a designer, he's an entrepreneur, and he's a money guy, but he looked at it and said, "This is something that even though we're making apps..." At that point, it was a company called [inaudible 00:39:05] Motion, who were designing for Vogue, and for Esquire, and these huge magazines that really cared about the aesthetic. He saw that the aesthetic, even though it wasn't digital, wasn't for apps, it wasn't for iPad or iPhone, could translate to digital design, it could translate to product design. That was literally the first time I even heard the term product designer when, in my mind, I was a graphic designer.
And I think those are two people who kind of saw the work and the potential and didn't think about it in terms of fitting into the box of title. So every time that I've hired now to this point, based on those two experiences, has been more about is it a cultural fit, and is it somebody that I could work with on a day-to-day? But is it somebody with a refined level of taste who could be executing in a bunch of different verticals? And if I needed a T-shirt, a website, an app design, an interactive design, or augmented reality, this person has enough of a design eye to build that from scratch without worrying about what the discipline is. And those are two people who did that for me, so I've been trying to do that as much as I can in my career.
Clint Betts
Rob, thank you so much for coming on, seriously. And it's an incredible product. I mean, everybody knows who you are, but everybody should check it out.
Rob Petrozzo
Clint, thank you, brother; I appreciate it.
Clint Betts
It's an incredible, incredible, incredible product, and it's genius. And well done on everything you've done.
Rob Petrozzo
Man, sincerely appreciate it. Thank you so much for having a great conversation. This was the therapy session for today, dude. You asked about it; this was it. This was the 45-minute walk, sitting with you and talking through life.
Clint Betts
Perfect, let's do it again. Let's do it every day, man.
Rob Petrozzo
Absolutely, for sure.
Edited for readability.