Listen Well

Listen Well

Where Are They Now?

Colby Tunick
Devin Miller
The Inventive Journey Podcast for Entrepreneurs
6/18/2021

The Inventive Journey

Starting and growing a business is a journey. On The Inventive Journey, your host, Devin Miller walks with startups along their different journeys startups take to success (or failure). You also get to hear from featured guests, such as venture firms and angel investors, that provide insight on the paths to a successful inventive journey.

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just listening really well and we kind of have an internal rule that if you hear something three times from three different people in three different conversations you know that should pique your interest because now that's not just you know someone's want or desire that might actually become an industry-wide need [Music] hey everyone this is devin miller here with another episode of the inventive journey i'm your host devin miller the serial entrepreneur that's grown several startups into seven and eight figure businesses as well as a founder and ceo of miller ip law where we help startups and small businesses with their patents and trademarks you ever need help with yours just go to strategymeeting.com and grab some time with us we're always here to help now today we have one of i think all my episodes i didn't say one of my favorite episodes but they're all my favorites it's kind of like choosing between your kids and i i have four kids and i don't know that i can choose between n of them but we have one of the where they at now episode which is really fun for me because you know it's you kind of do the initial interview you know meet the person here where they're at how they got to where they're at today but then you never really know where things go from there so love having people back on and kind of getting that ketchup episode so with that we have uh colby tunic and uh kobe uh is with the refocus ai and uh he was he came on about six six seven months ago had a good conversation kind of told us about his journey and he's back on to kind of give us an update as to where he's at so with that much is a short introduction as opposed to my little bit longer introductions welcome back on the podcast colby hey thanks for having me devin so before we dive into kind of what the last six months have been why don't you take us back to kind of where you're at six months ago what was going on and then we'll kind of talk about how the last six months have gone yeah absolutely so if we step in our time machine and you know rewind to the middle of the pandemic well of course six months ago we were still in the height of the pandemic for us at refocus we had just released our beta version of the product and refocus is a sales enablement product uh for people-to-people sales and we answer two key questions the first is when exactly is someone going to purchase a product and the second one is what exact product or service are they going to be interested in that given time frame and we were just kind of really honing in on that you know from a product market fit standpoint shortly after we spoke uh right around that time we've been in conversations with a couple of very very perspective or very very large prospective customers and we were actually able to close a couple of them uh so you know right around there we actually were able to begin those conversations that have since you know really helped us you know go down the ski hill towards our our success and i it's interesting to think six months ago was you know right when we were starting to have those initial conversations uh you know we also brought on some new staff members uh six months ago uh we you know revamped the website we started our blog about six months ago uh if you haven't had a chance to look at its blog.refocusai.com and we talk about everything from industry insights to digital transformation to software procurement everything that we can potentially put out there to help our uh readership which has since grown to 2500 weekly subscribers uh you know gain an edge on their competition and learn about the newest and greatest technology coming down the road so that's uh that that also started about six months ago so it's kind of fun reflecting back on how busy we've been and also the fact that it's only been six months it kind of feels like it's been two or three years oh i think it's kind of like in dog years where you know it's uh you know a year in the startup is like 10 years an adorable or an adorable job because you always have always running to catch your breath for that that whole year so i completely get that so no that was a great kind of where or kind of where you guys were at six months ago now i think the one of the first things that we i think we chatted a bit before the the catching up um was that you guys have now completed your first pilot and you have another five pilots in the work is that right yeah we are so we completed our first pilot with a national insurance brokerage they have about 5 000 employees spread across the united states uh we're now actually an international company our second pilot is with a fortune 300 company um we're working with their office in singapore so it's just crazy to think that you know we're uh we're when we talked six months ago i thought we were a team of four now we're a team of seven but you know with a team of seven we're an international company supporting multiple clients all around the world uh and then we have a uh we're working with another four or five companies right now uh with over a billion dollars in annual recurring revenue so it's really an exciting time for us no that is exciting it's always fun to grow and to see hey you know we had an idea we thought it was a good idea we put it out in the marketplace and hey it was a great idea you know it's always kind of that when you initially get it launched when you get it up and going when you try and sell it it's always a bit of question mark hey is this is people gonna think this is as good as i think it is so that's awesome that you not only rolled out you know had the first one that you rolled out went through with the big company but now you've had an opportunity to do additional pilots and now one of the other things i think that we chatted a bit is you also as you've gone through got it up and running did some pi you know did the first pilot doing you're working on getting other pilots you've also honed in on kind of what the value is to the customer so give us a bit of an insight how did you kind of you know over the last six months kind of figure out what to hone in on how to hone in on it and how is that gone yeah so i in for a little bit of background we started in september of 2019 so we're still relatively new kids on the block and we really spent the first year growing from our initial hypothesis of where we could provide value for our clients and you know we released a bunch of versions of the product in that time we learned a lot of lessons and ultimately what it came down to was one uh just listening really well and we kind of have an internal rule that if you hear something three times from three different people three different conversations you know that should pique your interest because now that's not just you know someone's want or desire that might actually become an industry-wide need secondly uh you know just really being out there not just you know in terms of calling and emailing people and publishing a blog but attending trade shows and conferences and competing in startup competitions and trying to learn uh about the the business business operations you know take feedback from that incorporate that back into your overall business strategy revise uh your pricing and personas the customer personas every couple months and uh it's really just been constant iteration if you ought to sum up the last six months last nine months last year would just be constant iteration uh and i think that's been kind of confusing i know i've had conversations with people on their team and they you know they're kind of like i have whiplash like i just like we just spoke four weeks ago like we were going to talk about the company this way now you're telling me we're going to talk about it differently i'm like yes yes we are and here's why one question and you started to touch on it but i'll dive into it just a bit deeper is you know when you get in there's multiple ways to get customer feedback you can do everything from you know um watching the website you know doing hotspots you know or where they're clicking and monitoring that you can get emails you can get you know ask for reviews you can give them a phone call and you know dial them up you can do multiple things and so when you're doing all that you know did you try all that are you implementing all that as you found one this bet one way that's better than another to get the feedback or kind of how have you gone about honing that knowing what to hone in on and then honing the message sure so we were actually able to settle uh fairly well into the the value that the product provides and i think that comes down to just having a great advisory board but how you talk about it that's really where the rubber meets the road and you can have the best product that actually solves the need but if you can articulate that in you know nine words in you know five seconds you know all of those prospective customers that might be interested are gonna shut down and uh you know hang up the phone so what it really came down to was you know and i i hate to say but there were just a lot of people in the industry that were gracious enough to bear through perhaps the conversations that were less articulate or you know less to the point or you know not as fluent as they should have been and were able to after hearing it almost synthesized back they were like you said this but what i'm hearing is you know this sort of thing and be like oh yeah that's that's what we mean and then over time actually adapt the customer language as the sales proposition as the sales language and i think that's also been very effective is you know just learning how the customers themselves think about your product and articulating that back to them it's uh one it's very rewarding to them but two it makes what you're doing very clear no and i think that that's a certainly a great lesson learned and you know and you know i think it's one thing that makes products successful you know it's you always put it out in the wild and i i don't care how good you've tested the marketplace before you put the product out you know there's going to be things you didn't consider and you know i always kind of joke but it's you know there's a lot too so i've done several different startups and i've been in the software arena and you know it's it's incredible the things that you don't think of until you actually put it out there you know the way that people do it i always i always joke is you know it's hard to make something idiot-proof because they keep making better idiots in the sense that there's always things that you don't consider and i'm not calling customers idiots don't take that the wrong way by any means i'm more saying that there are things that you would have never thought that people would have tried this that have done this they would have you know interacted with this way they would have tried to do everything else and until you really try that until you really get that understanding you're never going to fully um be able to iterate on the product but you can't put it out in the marketplace and then just say oh it's done we built it it's good to go don't worry about it you know that's not a good place so i love the iteration now one of the other things you mentioned is kind of diving through is you made a couple hires you know it sounds like you had a couple key hires tell us a little bit about that project or process so you know was it a smooth a fluid process you loved it it was a perfect thing it was arduous and you know time consuming and it was a you know because that's always you know you start out as a very small group with a startup you have a few key individuals a lot of times there's people you trust there's people you worked with before and then you reached a point to where now you have to expand out it's no longer just that key group but you're saying hey we have other needs we have other people we need to grow the team and you know i've i've gone through where i've rushed through way too quickly to make hires and they haven't been good hires and i learned my lesson and there's other ones where i took my time slowed down and we've had absolutely great hires i've been on both sides of the spectrum and i've you know you let learn those lessons so how did the hiring process you as you're looking for those hires had to go for you well i think it comes down to when anyone starts a company the first people they normally look at to start a company are people within their immediate network and that is mostly from a security standpoint because if you know if you've known someone for a couple of years outside of a work setting you pretty much can understand you know how how effective the benchmark how effective are they going to be as a co-worker now uh i have heard a horror stories of someone who you know they go and they find someone they've never met before they they supposedly both share a common idea and you know they go to try to build a company together six months later you know one founder is doing all the work and the other founders you know mowing lawns or you know doing something not related at all to what the mission that the two or three set out to do and um i've also heard stories where that works extremely well um but it's kind of a mixed bag one of the things i have learned and i think the team has learned from this journey is you just have to start and especially when you begin you know fresh i have an idea there's no product built so if it's if it's a physical hardware sort of product you know nothing built of their software there's nothing that anyone can click and touch on you know it's important to just get a team together to get something out the door and then the thing is the the more mature the product is the higher quality people you'll be able to attract uh you know i have a wonderful team uh you know chief operations officer our operating officer alexa chang has been with us from the beginning uh our chief technology officer actually had to step down uh went through a major life change and that was that was a major shift uh and in uh their place we were able to attract uh a 35-year you know phd machine learning expert worked with you know multiple fortune 50 companies uh for lead and demand generation pricing and revenue forecasting uh dr nassar honda wall and i just have to say that if we had set out in the beginning to attract someone of his caliber we wouldn't have been able to and one that's because we wouldn't have been far enough along to provide you know someone of that level the certainty that what we're working on is actually wanted by the market and two we wouldn't have probably been able to articulate our value proposition in a way that would have been attractive to someone of you know a a later senior hire would require uh and so for the people that are listening in uh you know it's more about just getting going but then i i and i i say this because you know especially if they're personal relationships you wanna you wanna be respectful of that but you do have to be um i think the best word for it's just ruthless when it comes to hiring right you you always need the best team and sometimes the team you started with is not the team that's going to get you across the finish line um that can be you know both uh you know a team decision like hey this person isn't working out or it could be mutual like hey you know i you know this just isn't working for me and every step of the way as you continue to grow and as you continue to reach you know key kpis key revenue numbers it's easier and easier to attract people of higher caliber now we're in the place where we are you know uh you know making early revenue about to make early revenue you know early recurring revenue and so making sure that we had enough of the cap table free in order to you know attract those people if we can't pay them you know multiple hundreds of thousand dollars a year was also key so you know kind of two lessons there one get going but two make sure you have enough cap table available so when you get to the point where you really need to start hiring you know seasoned key industry leaders and bring them on to the team you can attract them not just with your mission but also with your amount of equity you can offer them no no and i i definitely agree just as a quick reminder for those what a cap table is basically a cap table is in and kind of a quick summary it's ability to give them shares or equity you know and there's different ways of doing it depending how you have do it shares equity or other incentives such that when they come on they may not have necessarily as high of salary but they have that hey if the business does well you'll have an ownership you'll have a stake in the business such that you can get that reward as a prosperous so just as a complete aside but no i completely agree and one of the other things i thought was interesting so one of my i have a lot of books that i love favorite books but one of my favorite books is um it's by mark randolph which is the founder of netflix and original you know steve hastings the one that everybody knows now but he wasn't the original founder mark randolph was and it was that will never work and a great book you should definitely read it not plugging it just i just like love the book but one of the things that they kind of talked about is the reason it shifted over from mark randolph to steve hastings and they also had to shift over from some or some initial employees to new employees is because as a startup a lot of times you start with the generalists in other words you need people that can do a lot of things fairly well but they aren't specialized in any given area as a business continues to grow and mature a lot of times you shift from hey we need a whole bunch of or several generalists to some specialists and those specialists can do just some areas very well and they may not do everything well but do some things very well and so as you shift that to your point is kind of hey we need or sometimes you start out thinking we need you know these type of people and then hey now we need these experts in the industry we need other things and so it's always interesting how that evolution occurs with each startup and it occurs over different timelines different sizes different types you know different there are ways that it shows that but it kind of has that same outcome within each business as you continue to grow so i definitely understand and think that makes a lot of sense well so now we've kind of gone through and you've uh you've done you know so you've talked about you're doing your pilots you've made some key hires you're continuing to grow um you know you've honed in your value proposition i think one of the other things you mentioned is also getting ready ready to do a venture raise as well is that right yeah so we will soon uh be going out and we've already started to soft circle some of that investment uh to do our initial raise which uh we've decided it's a precede i think that's one of the difficult things right now with with startups um one is you need a you need a product and you need users you know and then what you really have to do is find a firm that you know most firms either like we accept pre-revenue companies or we don't right but as long as you have a product you know and you have people using it on a regular basis you're okay but there's a lot of confusion and ambiguity in the market right now about what the titles of the rays mean uh right i think that there's so many different titles it's it's precede versus seed versus series a series b series age point one five if i mean it just seems like and then it seems like every time people just come up with new titles to make it so it sounds new and different seed one seed two it's a bridge it's you know it's uh it's just yeah so originally we thought we were going to do a seat now we we've spoken to a couple of you know key trusted venture capitalists who are not interested in working with so we can you know expect and i think that's the other thing um you know as a founder you're going to speak to a lot of investors and if you can find a couple that you know don't actually invest in your market but you know are reliable and you can trust them they'll provide you a lot of great feedback on both your raise material and your pitch and you know strategy and things like that i think that's really key i didn't i didn't know that necessarily going in like go go find two or three investors you can talk to that just like you as a human and but they don't have that conflict of interest and because of that we've since decided to call it a precede but that was a we we we talked about like we're going to do a friends and family and a seed and a precede or a post seat or it's it was like it got so confusing uh and but the funny thing is the number the dollar amount of money we were raising never changed it's always been the same amount of money we want to raise however uh it's just really the amount of expectation that investors have going into that raise um you know it's also there's a there's a lot of people out there with raises a lot of you know early stage vcs venture capitalists that you know they're okay writing you a hundred thousand dollar check if you want to just raise five hundred thousand dollars but it's really weird you know these days and with the amount of the cost to build an a functioning software product the cost to you know support customers on a functioning software product and there's actually a bit of a gap in the space between like you know raising a 500 000 and raising a million and more because the amount of traction and kpis you have to have to raise over a million are you know far more significant than if you want 500 000 but if you look at what five hundred thousand dollars gets you in terms of burn rate and key hires and product development and eventually revenue numbers right everything comes back to revenue you raise five hundred thousand dollars to get the x number and it's it's it pales in comparison and honestly in a lot of situations if you're not just you know two people the core founding team and you need to go hire some consultants may even be insufficient so uh just you know for those listening and i would just have you think critically about what your actual funding needs are how you're actually going to use the money and ultimately how long that money is going to last and what revenue that money will get you to if you can answer those four questions you'll be in a good shape to strategize your next raise no and i love that and you know it's interesting i think it's just as hard to raise a friends and family around as a series a and a series b and it's not like oh now we've made it this round is a piece of cake you know in some sometimes it is or if you get the lead investor it can make it easier but that but it's always you know it's always a chore and it's kind of like you know selling you know raising five hundred thousand is the same as raising a hundred thousand and it is difficult as raising 10 million depending on where the company's at so i think that that definitely makes sense so well awesome well so now we've kind of walked through you know we've done everything from your currently in a raise and definitely encourage those that are either credited investors or investors or other people who want to get involved they can reach out to you but you've also refocused you've you've honed your message your own your business anything else as we kind of wrap towards the end of the the episode anything else you've done over the last six months that would be interesting or that otherwise people should know about or think about as they're doing running as they're doing their business yeah um and i think this is just kind of a the indus software is very cyclical but it's also very buzzword trendy heavy so we have a lot of people we speak with uh that don't actually understand what machine learning is and there's a lot of companies that you know talk about machine learning uh perhaps incorrectly uh you know there's a lot of great companies out there that are actually using some sort of machine learning artificial intelligence uh to drive value and one of the struggles for us has been trying to say like no no we're actually using real machine learning uh to generate these you know real-time sales insights and you know we have a lot of people that ask well like oh we spoke to this other company the other day and they say they're doing something similar but then you kind of dig into it a little deeper and you know they're doing optimization or they're doing some sort of robotic process automation or pa which aren't machine learning uh sort of derivatives and you know one of the things we've had to be really cognizant about is how we talk about you know both ourselves and our expertise and our skill set is to to really make it known that you know just ai and machine learning is a very specialized skill set it's it is difficult to do and not everyone that talks about it you know is actually doing it in the market uh you know that was a kind of a challenge that when we spoke six months ago i didn't expect and it's become really prevalent now because we're talking with you know such large companies that are being approached all the time by companies like ourselves to be quite frank and you know there's kind of this confusion about like what is machine learning how does it actually work uh you know how how is this different than you know uh a monkey in a black box just like spitting out recommendations uh and you know i would uh i i think one of the things that's very helpful not only for investors but for you know co-founders for startups for people that are just interested in learning about machine learning is to you know just pick up a book and try to understand maybe even try to code some of it themselves to figure out how it works and that's sort of practical hands-on knowledge i think is beneficial to anyone who's interested in ai but the other kind of key caveat to that is machine learning is not a silver bullet and we've actually had to turn a lot of companies down because they're not either in the place where they have the data necessary or what they want actually doesn't require machine learning and for both those reasons both very valid reasons we've had to say to some very large uh potential checks you know i'm sorry we just can't work with you or you know we're actually not the right fit and we don't we don't want to you know set ourselves up for to not meet your expectations so saying no i think ultimately saying no and and being really strong in what we do well those are kind of two lessons that we've learned over the last six months that you know if you would ask me six months ago what do you think some of your struggles will be i would have never have predicted um no and i think that there's a a lot of wisdom there so now as we start to wrap up i always like you know where they you know normal episodes always have the two questions i ask at the end of each podcast and what the where they at now i always like to change it up just a bit um so the question i always like is you know as you go along your journey you know on the one sense the farther you get in you learn a lot you you know you pivot you adjust you adapt and you do that you also sometimes i think when you initially as a as an entrepreneur you have you're a bit naive and i think most entrepreneurs are otherwise you never get started and then you also you don't you know you don't know what you don't know so to speak and as you get further into your journey you get less naive and you learn more which is a benefit but it also can kind of create those fears of you know now you know what you you should be working you know now you know what keeps you up at night so with that along your journey so far what's uh what's your biggest fear and how have you dealt with it well i don't think anyone should start a journey like having a startup if their dreams aren't bigger than their fears because then they'll have nothing to you know keep pulling them forward or pushing them forward or working towards uh but you know the biggest fear of you know it's a difficult question i think it's a very valid question and it's kind of twofold it's it's one you know is something going to happen in the market in the global economy that you know dries up all of these budgets that you know currently we're working with right because if another 08 stock market crash or another tech bubble happens chances are people are going to say you know we just sorry like we love what you're doing but we don't have a budget for it and that's really that we've never gone that uh we've never had someone tell us yeah we don't have a budget for what you're doing we've actually gotten really positive feedback if you hear that that normally means you're not solving the problem but after a tech burst bubble something like that it's very possible that these budgets could drive up and you know of course that has nothing to do with us that's kind of an external fear as the world kind of returns to a new normal after the pandemic too it's just trying to make sure that you know that continues to happen and that there's not some sort of next wave that derails how businesses are thinking about operating in the budgets and their you know revenue forecasts but uh the the second one is you know and i think this is perpetual it's you know what if something happens to the team right i mean and this isn't like you know someone just goes off the deep end or you know has a a a stress attack i i joke with my co-founders that we actually get stressed stress stress equity strike distress quickie uh and people are like oh yes you know stock equity is great i'm like no no you literally get equity for stress like you just you literally it just you know have to try to it's stressful and so it's it's a matter of you know well what happens if someone goes through a major life event or a family member gets sick or you know some sort of you know life-changing event which is unfortunately they do happen and you know suddenly you're kind of left with a gap again and we already went through this once without when our cto unexpectedly resigned due to that significant life change and you know we parted on on very good terms and we only wish that person the best and you know very fond memories of the time working together but you know suddenly you go from having a strong team that you know you have all of your gaps filled suddenly you have a big hole and except last time when this happened you didn't have fortune 500 customers saying okay you promised me this where is it uh so i guess that that for me is probably my biggest personal fear is like what happens if there's a you know the composition of the team changes and how long would it take to find someone with the skill set and experience to fill that and of course you can handle that a myriad of ways from succession planning to you know coaching to just regular check-ins and saying hey is there anything on the roadmap or your horizon that i should be aware of but you know life does happen and it's those unexpected curveballs that ultimately keeps this interesting no and i think that you know that's there's a lot to impact there and we won't dive into all of it but i think that there's a lot of validity but i think even the things that you learn are that are out of your control you kind of touched on that the economy or what are things they're saying they are a great product we just can't afford it or you know those type of things are ones that you start to learn and say okay i just figured everybody buy my product if it's a great product and i make a great thing and then you know you start to learn but i think there's a lot of fears in there but i think it's also one where a lot of times we don't you know you tend to not want to focus on the fears or even talk about in the community because then it makes you show like hey everything is not absolutely perfect and i don't have everything figured out it's not all just going exactly as perfectly as i could ever planned and i think that you know you have to have the the forward foresight say hey i'm going to have to i'm going to have fears i'm going to have things that i'm not going to be able to control or not haven't thought of that i'm going to have to encounter i'm going to have to figure out how to deal with and so rather than just kind of pretending like they aren't there recognizing them and then figuring out how to deal with them is a great thing so i love hearing a little bit about that well as as we wrap up then it's been a pleasure to have you on again um but if people want to they want to be a customer a client they want to be an investor on your current round they want to be an employee they want to be your next best friend any or all the above how do they reach out connect up with you and find out more absolutely well they can reach out to me uh through our website which is just refocusai.com uh you can drop us a line there you can also email me it's colby refocusay.com and uh always happy to speak to someone who's just interested in kind of innovation and product you know i don't want to say that we're a success story yet because we still have a million miles to go but you know if someone is just getting started and they say like how do i take this idea i have and you know what what's the next step right how do i take my first step on that journey always happy to to help someone think through those uh steps there as well awesome well i definitely encourage people to reach out find out more support you guys and and any and all of the above so thank you again colby for coming on it's been a fun it's been a pleasure now for all of you listeners if you have your own journey to tell whether you're telling your six-month journey where you're at or you're just starting out on your journey we'd love to hear your love to share your journey um so feel free to go to inventiveguest.com and apply to be on the podcast two more things as a listener one make sure to click subscribe in your podcast players so you know when all of our awesome episodes come out two leave us a review so no everybody else knows that or can everybody else can find out about all of our awesome episodes last but not least if you ever need help with patents trademarks or anything else with your business feel free to reach out to us by going to strategymeeting.com grabbing some time with us to chat well thanks again kobe and as always wish the next leg of your journey even better than the last thanks to having you too you