Aug. 29, 2020

Scale and Exit - by Brett Lewis, Co-Founder at SkillBridge.

Scale and Exit - by Brett Lewis, Co-Founder at SkillBridge.

Brett Lewis, Co-founder and Co-CEO at SkillBridge acquired by TopTal, talks about the acquisition, the major mistakes they've done with SkillBridge and the major successes they had. We also talked about business development - what does one actually do and how is business development at google different from business development at early stage startup.

Brett's LinkedIn: https://www.linkedin.com/in/brettrlewis/

Acquired by Lyft: https://open.spotify.com/episode/04id5VWWnfNzDVCnhTFX2a?si=gr5tjriJRLOQ4hsY_B4T1g

The video record: https://youtu.be/pKGCxQgxFCU


Transcript

This is fundraising radio and today's guest speaker we have Brett lou's global business development, lead at Google, and a Co, founder and CEO at skill bridge that was acquired by top town. 

And then this episode we'll talk about business development and Google versus business development at an early stage startup. So we'll compare brad's experience at Google and brad's experience at top tell. 

So, unless you called, but you're giving us some background on yourself and on skill bridge? Yeah, thanks a lot Constantine so first off. Congrats on everything you've been, you've been doing here on the radio stations. 

Awesome and thank you for inviting me. Yeah, so, I mean, you know, not sure where to begin, but to make a long story short, I guess my career mostly was in strategy consulting after college. 

I worked at painting company for a few years in London and then when I went to business school at Wharton, I got a lot more interested in the startup venture capital ecosystem in general. 

I spent a few months working on a VC fund in Brazil and during that time, I sort of started seeing all the great work that that startups and founders were doing. 

Both in the US and in Latin America, and I was kinda like, I really need to try my hand at this. I've had a few kind of entrepreneurial ideas and things that I've done earlier in my life. 

I'm kind of a smaller scale, 

and the beautiful thing, 

you know, 

this is back in twenty eleven, 

twenty twelve was kinda this idea of the agile framework and failing quickly and it just became so much easier and cheaper to start a company than it had been basically, 

forever before before that and myself and a couple friends batted around ideas for the entire summer. 

What could we do that obviously had a need like, what, what was a pain point that we could fill for customers but also where do we uniquely have a skill set. What could we leverage that was a bit different and differentiated from from other people. 

And what we landed on was this idea that there was a lot of kind of a, there's an emerging freelancer marketplace. That was happening with the likes of EA, lens and oh desk. 

And fiver, 

and now there are many others, 

TaskRabbit and so forth, 

but there wasn't much that was kind of capturing this more premium end of the market for people like ourselves who I kind of more of a business background and finance consulting marketing. 

And things like that, and so we said was, there's a lot of people like ourselves, who don't want to be tied down to to a nine to five or to eight to midnight, you know, four or five days a week anymore. 

And there are a lot of companies of all sizes from very small companies to fortune five hundred companies, 
private equity funds need access to really high caliber talent, 
but don't have the budget, 

or the need to bring on a full time employee necessarily, 

or to hire the goldman's or Baines of the world with a name for a million bucks a month or more in some cases. 

And so you're kind of tapping into what now during covert has become quite obvious, which is that people can work in a distributed manner pretty effectively. So that's sort of backdrop that was kind of the AHA. Moment for us. 

There are a lot of people like ourselves who are willing to do work like, we had extra capacity, and a lot of companies that want a great people, but didn't want to make the commitment. 

So that was sort of the, the marketplace we were building, and when we went back to business school for our second year, we pretty much spent the entire time working on it. 

And so we founded skill bridge myself and my Co founder Raj, Jay Kumar and we. 

You know, I'll let you ask some questions, but basically we took advantage of all the resources that we could possibly find at warden and more broadly, in terms of building a business plan. 

Getting our first customers getting a product out the door, raising a bit of venture funding and so forth and I'm sure we'll talk about all of that, but just to quickly finish. I guess the who I am part of it. 

We ran SCO bridge for three or four years. We've actually sold it to a company called top tout. It was, and is also a freelancer marketplace. It was more focused on engineering talent at the time, and wanted to build out a business vertical. 

And then, after that, I spent a little while working on investing and then moved over to Google about three and a half years ago where I worked in business development and partnerships. Nice. That's really cool. Congrats on the exit and on work at Google. That's really cool. 

But first question I want to ask here is the very beginning of the journey. What do you think was the major factor that really allow this business to exist? Is it the fact that you had great Co, founders? Is it the fact that you've brainstormed this idea? 

For, like, three months of the summer and you actually, like, really put a lot of thought into what you can do with your specific. 

Talents skill set of the team, or what was that major factor that you think made the company successful? I mean, you know, I'm trying to avoid cliches and stuff, but I think those things all mattered, I guess, to an extent. 

So, we did spend a few months really whittling down a lot of ideas you know, I don't know if this is necessarily the best way to do it, but we essentially put down on paper. Twenty five things we thought could be interesting. 

I could work then we would each sort of almost pitch to each other. Like, here's why I think this is actually what we should spend time doing and essentially convince one another. 

There were three of us at a time, and I ended up being two of us that were Co founders, but I think that was a really good process because people have a ton of different perspectives and ideas. 
And if you've got a couple of people that you respect, and that you work with, and you, you sort of pitch each other, like, you're gonna have to clients and customers and venture funds, if you want to fundraise that's a pretty good process. 

But then I would also say, like, you know, I could've done any of it without my cofounder. Raj, we had similar backgrounds in some in some respects, but also very overlapping skill sets. 

He ended up really loving kind of like the product and technical side. 

He wasn't a computer science major, but he, he did think physics at Oxford. He was a very technical guy and and I was very commercial that had been sort of my focus. 

So dealing with clients, contracts, fundraising, things like that. I really enjoyed that process. 

So I think having a great, great team is super, super important, especially if it's your Co, founder, I mean, you're marrying this person through good or for ill, and they're gonna be, you know, highs and lows. And so that's that's obviously fundamental. 

And then, obviously, there's everything else I followed on from that in terms of, you know, clients and and products and all that stuff. So let's start. There was you mentioned that you to, you basically use any risk. 

So every resource that you found at your university, 

what was the best one that you found there that you actual, 

like, 

discovered and you're like, 

oh, 

that's actually helpful let me use that, 

you know, 

I think, 

I think there's so many of these these things now, 

in terms of venture programs, 

business, 

planning, 

competitions, 

fundraising. 

I don't know, to be honest, I don't think there was any one thing, and I don't think there ever will be any one thing that can make, or break your business. 

I think for us, it was just being kind of accepted into these communities, gaining access to other, like, minded founders was probably the most important thing. 
You know, your business is not gonna be successful on the back of a business plan. That looks really 
good and getting some funding, which we got, can certainly be helpful, but it's also not going to determine the success of your company. 

I mean, that's really you almost have to make sure you're so focused that you're not being distracted by these, like, things that seem like they're wins for you, but they're, they're actually just sort of very incremental. 

So, I'd say for us, you know, we did just the venture initiation program award and we, we were finalists in the business plan competition. 

We worked with first round capital's dorm room fund all that stuff was awesome, 

but probably, 

mostly just because you started to accept some of this wisdom through eyes most of this from other founders and that can be really helpful and can keep you honest and people can kind of push you and and make you think about things you hadn't thought of before 

but at the end of the day. 

You're building a company, and none of those things we'll do that on your behalf. There's kinda just like the blood sweat and tears that you need to put in. 

So, the day to day, kind of blocking and tackling and no sort of no fund or program in my experience. We'll do that for you. 

Most likely not, unless you're working with a major studio, where we actually dedicate some team members to work with you, but it's just so promotion share a little bit talk about business development. Can you define the business development? For me? 

Personally, it's like, developing a really good business relationship with the potential partners. Probably even fundraising start development and startup, but for you, what is the official definition of business development? 

Yeah, it's a really good question and it completely depends on, I guess, two things, both the stage of the company and the stage of the product you're working on. 

So as skill bridge, obviously,
as a founder Co, founder, 

and basically just met,
like,
I mean,
it was so much more than traditional media and a sensitive it was not only just finding clients, but it was really understanding what clients cared about. 

And how that affected our product and, and how we were eventually going to scale and things of that nature. 
But, I guess before that, I mean, business development, as you said, I think is developing potential partnerships and deals with with clients or other big companies. 

So,
a Google, 

it typically means going and working with other other very big companies and discussing a value exchange in a way that we can maybe share part of our technology and they can share part of their platform and distribution channels. 

But it's essentially finding ways that you can work closely with with another company, or with the client and it is a little bit of a vague term. 

Because it really depends on if you're talking about, like, new business development, where it's a product that's hot off the shelf and you in a sense in D, you are still figuring out product strategy because you're hearing what your partners and what the market is us feedback. 

And then you're working really closely with product and engineering for them to to change the product, as they might see fit or, if it's more mature business development, it's kind of like, this is our product. We know that it will work for a lot of partners. 

And clients out there, so let's go and just sort of. Tackle them one by one,
I have always obviously had skill bridge,
but also a Google, 

then on a newer business development side of things where I work with our product and engineering teams almost more than I work with partners because there's so much kind of internal figuring out of what the product needs to look like, 

what the features that has to be what the partners care about what they're willing to accept, but they're not willing to accept before you actually get to a term sheet and a deal. 

There's a lot of that kind of upfront work on a newer BD side, which is what I've usually focused on. Right right. So, let's go a little bit back to what you just said, which is basically understanding what the clients need. 

And that's the question that I didn't plan to ask you, but it just popped into my head because just yesterday two foundries asked me the same exact question. Like, I had problems with my previous Serbs one of the major problems that I got was collecting that feedback. 

And putting it into something sensible, not just trying to at every single feature that my potential client, or am I paying customer tells me to add because cool. What's what's your process? 

Is that when you were doing business development skill bridge, how do you aggregate that? All that feedback actually made something that made sense. Was it some specific table or was it just literally on the waste paper? How how do you approach the problem? 

Yeah, I think that what would the, the biggest tools you have is a thunder in a sense is that you are just so strapped for resources. 
And for time that it, it almost sends you into hyper focused drive because you have no other choice. In our case. 

We had a, and we had two engineers on average, depending on which year we were talking about, but it's a very small team initially for the first, maybe year or two years. It was less than ten folks. 

And so because of that you are, so so so driven to, to minimize any, any unnecessary work, because you just basically can't do it. 

And so I think we found that that was, at the end of very good, good thing for us. We ended up doing Highland Capital program as well over the summer. 

And I think one of the one of the pieces of advice we got from one of the partners, there was, you know, if you can funder, is it's not a bad thing to do. Because it means you're gonna have runway for another twelve to eighteen months, or whatever it is. 

But one of the worst things for started is when they actually end up using too much capital, because they do all the about the build stuff that isn't really isn't really critical. 

So to answer your question, practically, I mean, we just spoke to as many costs customers as we possibly could, and we did it before we had a product. So we went out and we would survey fortune five hundred companies. We would survey private equity funds. 

We survey startups, all of these clients that we, you know, we thought were part of our addressable market and heard what they wanted from us. And that was relatively straightforward. 

They were like, I want access to really high quality talent at a, at an affordable price. I'm not going to go hire a big firm for a lot of these things, but I do need help and I do need to be flexible. So, that was pretty clear. 

It's kinda like, okay,
like,
you know, 

we understand the market that we're building here and then the devil was in the details we found there was a lot of work that was required for kind of scoping projects for project management for payments for escrow accounts for holding people accountable, 

and that was stuff that we just sort of realized by actually doing this work. 

And it was kind of like, where are we spiking in terms of time that we're spending doing stuff we don't want to do and so a lot of that was what we started building into the product was, how do you make these templatized? 

And how do you put these milestones in place? So that we can increasingly remove ourselves? 

From this process and so actually, I think, in our case, it was a lot more understanding what our clients and our freelancers needed that they didn't necessarily know that they needed, but we needed to make this process move a lot smoother. 

Because then of the day, we were selling talent and we were selling sort of output and projects, you know, we weren't selling widgets that. We're just like cookie cutter. 
So, for us, it was all about process improvement, right? Yeah, I'm totally a big fan of that methodology. 
Where you just started doing everything very in a very stupid, robust way, where you do a lot of stuff by hand, and claim that doing it or something like that. And then you actually started substituting some parts of it with knowledge. 

I think that's the only way to build it out, but let's talk about the major subject for this whole podcast, which is fundraising. How did the fundraising go for the skill breach? What did you do there? How do you re, specifically the first? The very, very first round of money. 

Yeah, that's a good question. So I think one of the great things about being in a place, like business school is, you just have, like, tremendous access and the networks can come in a variety of formats. Right? 

It can be like you're in Silicon Valley, or you're part of a larger tech company that maybe spun out. Some people that are now, angel investing. Those networks can come from a lot of places. 

I think the thing for us was we had really great access. So, I was just thinking, I was listening to an interview about John Foley, founder of peloton, and I felt a little bit like him, because he could get into any room. 

But people were kinda like, you haven't done this before. Like, why should we? Why should we believe in you? 

And I think for Raj and I was kind of the same, it was like, okay, we can manage to find we could network our way into almost anything, but once we were there, how could we prove that? 

We could be founders of a company, because our backgrounds typically had been more kind of corporate finance things of that nature. And I think in our case, what really, really worked extremely well was having revenue. 

So kinda like, we were just talking about. We did a lot of this manually with that. We'll have it by hand. We totally faked it until we made it, but we had, you know, we had a dozen clients and we even had. 

Three or four of those who are repeat clients and I think and some of them were were brand names, you know, we had Estee Lauder. We had Warby Parker. We had General Catalyst. 

There were, there were a few these kind of big brands that were really liked our product and. 

As, you know, I think so many people are trying to raise money, way too early and I understand it. Right? You're not working you need capital to keep the company alive. But I think it's so much more powerful. 

If you can show that, you have some degree of product market fit. Right? The addressable market is always a big question. Mark how fast you can scale is a big question mark. 

But, if you can show how somebody actually wants to buy your product back, when, when Kickstarter was all the rage, I think anything that shows that there's demand out there is super powerful. And so, for us, I think that was really the key. 

We recruited a great first first, and we had a handful of clients and that was, that was enough, I think, for the beginning, right? 

Because we were raising relatively small rounds, and that was enough to get us over the line. And then you then done the clock starts taking right which I think is a big consideration for when you wanna raise venture money. 
If and when you want to raise venture money, because everybody's gonna wanna see within twelve months, if you hit the next milestone and it doesn't give you a lot of time. And it does make you sometimes do things you wouldn't. 

Otherwise do, because you're just trying to scale so, but yeah, to answer your question, I think, in our case, it was having clients and having a good team, which were good. 

That's pretty much the, the golden bullet, the silver bullet. I keep confusing. Golden,
and it's horrible,
but, 

yeah, 

I mean, 

having traction some good traction and it did seem that's you're, 

you're done, 

you raise money, 

but let's if you could go back in time into the beginning of that fundraising process would you change anything? 

Would you, like, make the round bigger or would you maybe reach out to strategic investors? Instead of just angel investors, or maybe you would reach out to very early stage PCs or would there be something that you would change here? 

Maybe ending in hindsight, like, when you when you're when you're fundraising for the first time, I think anybody that's able to write a check. 

But there's a lot of different venture capital funds and angels and things out there. I think in our case, we, we kind of sprayed and prayed way too much. 

Like, we kinda like, you know, let's just make a list of thirty investors that we know whether or not they're angels or funds whether, or not, it's a small fund or a big fund and kind of went out there. And I think it ended up working out. 

Okay, because we were able to make inroads with some pretty good places, but I think in hindsight, we probably should have been a little bit more strategic with kind of approaching angels first. 

I think the first couple of rounds, even just near the first round, you want it to be not necessarily the best venture capital funds. You can find you want them to be the real evangelists of your product people who just. 

Love what you're doing and really, really care and want to help you. And then, I think once you get a little bit bigger and you have a little bit more data, you can point to. 

Then maybe you wanna go to more of kind of like the big brand names who will give you more time. 

But we were kind of doing all of all of those things we ended up in the room with very sophisticated larger funds who thought this was an interesting idea. But we weren't ready for that. 
And then I wouldn't say we burn any bridges. But then you kinda have to go back a year or two later and explain how things have changed and the progress you've made. 

So, I think what you really want to do at first, whether or not it's angels or maybe slightly more out of left field, venture capital funds. I think you wanna find the people that really, really believe in what you're doing and actually want to get involved. 

And, of course, if they have relevant experience, like, in our play in our case, like, marketplace, experience or professional services experience that's probably best. 

And then, if you want to, you can go talk to talk to the fancy liners and of the world later on. 

But I would be a little bit more strategic about kind of the nature of these funds and not getting too far out ahead of your skis. Because it can become very distracting and ultimately you might want to talk to them, but you want it. 

You want to have those conversations when you're more prepared. 

Right, right, absolutely. And one more time traveling question kind of thing. 

If you like, 

looking back at your journey with skill bridge, 

like, 

all the way up to the acquisition, 

what do you think was the major thing though, 

is, 

like, 

slowing you down maybe was like, 

on the first round, 

you gave out too much equity and then that's really slowing you down or maybe there was some client or whoever this what was the thing that you've made that kind of slowed down to approaches? 

I think in our case, I'm seeing a theme here. 

So, 

maybe, 

maybe this is something I need to think about, 

but I think we also went after probably too many different kinds of clients and we ended up trying to build a product that was, 

you know,
okay for everyone,
but wasn't maybe exactly what a smaller segment of our client base needed and what I mean, 
by that is we sort of thought, well,
the marketplace by definition, you sort of bringing the supply, you bring the demand, 

they find each other and then, 

and then off, 

you go, 

you kind of remove yourself from the equation and you have this great highly liquid marketplace and I think that, 

you know,
eventually that's probably where you wanna go. 

And I haven't studied, you know, the of the world in great detail. But I do think there's a lot of value to starting with, like, an incredibly narrow focus and getting that. 

Perfect and then maybe that's enough for a long time or you can slowly add kind of some adjacent markets. 

But in our case, we were sort of like, you know, startups need great people, huge corporate need, great people, investment funds, need. 

Great everybody, everybody, you know, everybody can benefit from this, but at the end of the day, those are actually incredibly different sales processes. The way you get the approval to be a vendor at a large corporation is actually a six month process. 

Whereas, if his investment fund, you call one of the partners, and you're like, hey, do you have, like, three months where you need, like, some crack person that can help you? 

And so,
I think that was probably one of our one of our mistakes and then startups in general,
I wouldn't recommend selling to startups,
because they don't have any capital and funds,
which is,
which is perfectly right,
right you know,
startup shouldn't be spending money on unnecessary things but I think that was probably it, I think, 
you know,
being ambitious and wanting to do a lot is great and you need that. 

But I think you really have to, like, nail a couple of things before you before you try to do more. And in our case, that wasn't, you know, I don't think we didn't realize we were trying to do more. 

But but those are very different market segments at the end of the day and I think you need to stay hyper focused and nail it before you can do more. 

Absolutely perfect advice here. And now that we've discussed your mistakes, let's talk about something that you're really proud of. So, what's the thing that you've done at scale bridge besides you know, starting a successful company what's that thing that you've done there? 

That's you're the most proud of you you look back in your life. I did that. I'm good. It's a good question. 

I mean, I was just really happy with the fact that we the fact that we survived as long as, as long as we did made it as far as we did, you know, I think there's some things I can point out. Like, we had a, we had a great team. 

Like, we had a, we had a great culture. We had a lot of fun. There weren't like, you hear all this dramatic stories and there were difficult times. 

And there were some people that worked out and some people that didn't, but but there wasn't there weren't any of these calamities that you that you hear about more and more in tech press? 

But obviously more than anything, just like, the failure rate of startups is. 

So high, right I mean, I think everybody's going eyes wide open with these kinds of things and we were with some really talented people who beat us in some of these business plan competition or raise more money or whatever. 

And, 

for one reason, 

or another, 

be regulatory or just, 

the product market fit wasn't quite right they didn't last very long and skill bridge not only lasted and persisted but, 

but joined bigger company and help them build out a whole new business unit for top ten ultimately. 

So, I think all of that was really, really exciting and it just came on the back of, like, every day by day, week, by week, just trying to trying to win more than you lose. 

And I think that ultimately is like, the most gratifying feeling. 

Right, yeah, and that's that's true. I mean, that Congrats on that. Congrats on that, let's speak about the acquisition, just a little bit the actual plan for it didn't happen quickly. Where was it completely well plan random event that just secured? 

So, I think at the outset, Raj, and I were pretty open to any kind of potential outcome. We founded this company. We said it might not work very quickly and that's fine. 
At least we will have tried something and we will definitely have learned something, you know, and then, I think basically every, every six to twelve months, you kind of re, evaluate. You're like, okay, how are we doing is this. 

Good enough for us to keep spending time on. Yes. Okay. That's great. Then, where do we see ourselves going in the next year or two? Do we want to be an independent business? Do we want to eventually get acquired? You know, what's what's our goal? 

And so I think the idea of working with top tell probably merged around, like, the third year or there about, you know, things were going really well, but it wasn't a software company. 

We were never, we probably weren't gonna go public and so an acquisition, I think, at some point, seemed like it might be the right Avenue and then there's a bunch of these kinds of marketplace companies out there, which I think is great. 

And I do still think is the future of work to have this flexibility for people that need it. 

I think there's so many inefficiencies and unnecessary friction and finding a job and suiting your lifestyle if you want to work a hundred percent of your time or fifty percent of your time. 

So, I'll get off my soapbox, but I still think that this is kind of the future of the way that labor needs to operate. 

But so we were part of this community of marketplaces and specifically kinda talent marketplaces of which top towel is one of the biggest and best known specifically for engineers. 

And it just seemed like it was sort of made it just sort of made sense after after the third year or so. So we hadn't we hadn't planned on our exit when we started. I think we were always open to any outcome. 

And this one just kind of emerged as making the most sense three years into the process when we had grown to business. But, as I said, we kind of knew it wasn't ever going to be an independent company that we were gonna take public. 

So that seemed to make the most sense.
Right, yeah, and that's how usually things go then. Congrats. 

And acquisition again now, last two questions first is as an exit founder do do any sort of mentorship or angel investments for other startups or do we just keep focusing on Google? 

Yeah, Google is obviously my my full time job and then some, but yeah, I love mentoring and angel investing. Those are both areas I'm passionate about and hope to do more of in the future. 

Especially as New York, where I'm based becomes more of kind of a tech hub and tech ecosystem. I went to a high school here in the city to math and science school called Stuyvesant and there's a lot of founders actually coming out of the school. 

So, I've been doing a lot of mentorship of folks that are like, five or ten years behind me. So that's been a lot of fun. 

And, yeah, I've been getting more interested in writing, sort of angel checks, either through different angel networks, or, as as they come to, you, as, you know, this is all very organic stuff at this stage. 

But, yeah, I think those are both, I mean, they're Super fun, right? It's really fun to mentor folks and to feel like, you might have some sort of information you can share. That would help and it's just so cool. 
You can kind of live vicariously either through through mentoring or investing and I think I still think sort of innovation and technology has a lot of good that it can do for the world in shaking things up. 

You know, I think this weird time that we're living in now is a great example of how there are a lot of different lifestyles and workings that we never we never really thought about. That are actually pretty, pretty possible. 

So, I think it's a super exciting time to be involved in early stage companies. That's true. That's true. And good point. Happy to hear that. You're still taking active part in the, you know, giving back to to the other founders. 

They're younger than you, but let's talk about last thing call to action to, to the founders who are listening to this one was the one thing you want them to do as soon as that is always over. I guess I would say if you're. 

If you're building a company for your for your own sake, and for your own valuable time, I would as uncomfortable as it may be, I would look at the facts as objectively as possible. 

And I think that applies to to everything to fundraising, to your product to your team. 

But the one thing I would say is most important is feedback and taking taking feedback most importantly from your clients and not sort of having rose tinted classes. 

But we're really trying to see the world as it is, because I think so often as a founder, you're so enthusiastic about something that you sort of morphed things into being what you want them to be. And it's really uncomfortable. 

But I think really critical to to hear feedback, like exactly. 

As it is and know when things are working or more often than not when they're not working and just becoming really comfortable with addressing areas that need to be addressed as early as possible. 

So you don't waste your time because. 

That's the most important thing you have, right? Yeah. Don't waste your time D*** it. That's that's a good good advice and definitely follow that. My personal call to action will be go to the description of this episode. 

I will leave a link to brad's LinkedIn. Of course. And also to another episode about the quick acquisition by lifts, the person liked a lot. 

So, yeah, if you're curious about other acquisitions, definitely take a look at the description of the episodes, and as usually have a good date.