Matt Stapleton: Turning Excel Sheets into $480M, SaaS Ideas, Strategy, Startups

00:00:00 - A
He's a multi time founder, multi exited founder. You co founded capshare, that was acquired by Morgan Stanley. Later you co founded Spiff.
00:00:08 - B
I loved, I was the weird kid that kind of loved business as like a 14 year old or 10 year old.
00:00:16 - A
I'd love to pick your brain on that because that's interesting as well, like getting you know, you know, an investor to actually be a potential inquirer acquirer. Right.
00:00:24 - B
Beginning with the end in mind of like knowing that this was a possibility and something that we should be encouraging along the way. So often there's a like, no, don't talk to me. I'm building this business. And you can engage and talk and say no, but we'd love to stay friends and build those relationships over time. That goes a long way.
00:00:47 - C
If I sell privately, I still get a good value. But if I could go public and wait a few years and have it become a successful public company, my shares would go higher and I could get liquid.
00:00:56 - A
I don't know what investor even allowed that to happen. That was crazy. Everybody, welcome back to the Startup Ignition podcast. I was confused on what camera I'm looking at cause we just switched up the cameras in the room. But I am Tyler Richards, your host and John Richards, your other host.
00:01:36 - B
Hello.
00:01:37 - C
Hello.
00:01:37 - A
We are the Startup Ignition team and we are very excited today to welcome our guest Matt Stapleton to the room. He is here live and in person. Thank you for coming on. Matt. I have a bio for you and I want to read it real quick so everybody off the bat knows how cool this guy is.
00:01:54 - A
But today's guest is Matt Stapleton. He's a multi time founder, multi exited founder. You co founded capshare, which was a cap table management platform that was acquired by Morgan Stanley. Later you co founded Spiff, the sales commission platform. And honestly the whole desire of this, of you coming on the podcast sprung from Jaron being on the podcast.
00:02:17 - A
And John was like, we have to have Matt on the podcast.
00:02:20 - C
Yes, we have to have Matt.
00:02:21 - A
So you are co founders with Jaron on Spiff and co founders with Jaron on Cap Share. You guys share very similar work histories together. OB probably point. Yeah. Brothers by this point.
00:02:31 - A
Right? I know how it is with co founders, but Spiff was acquired in 2024 by Salesforce, whereas. Which is where you're currently at, correct?
00:02:40 - B
Yeah. So I was there for a year.
00:02:42 - A
Oh, okay.
00:02:43 - B
And it was by design, the way that we set it up is I was there for a year. My job was integrating Spiff. So getting everyone settled in Team settled, systems cut over. So I was kind of in charge of that on the spiff side.
00:02:56 - A
Yeah.
00:02:57 - B
And then I cut out. So I've been gone for a year now.
00:03:01 - A
Okay, so you've left Salesforce. It's been a year.
00:03:04 - C
And we'll hear what you're working on.
00:03:05 - A
Yeah, I know.
00:03:06 - B
We can talk about it.
00:03:07 - A
Okay, so from building FinTech to navigating exits to scaling SaaS, Matt has been in the trenches. He is a co founder again. Multiple. Multiple time founder. Multiple time exited founder.
00:03:19 - A
You've held roles in vp, co, founder, CEO, and most recently, obviously, you were a VP at Salesforce. That was a role that you left just a year ago. But you're very much so an early stage founder and you probably have written the book on lessons on what to do to get from idea to exit, so we're excited to have that.
00:03:38 - C
You forgot one important thing out of his history, his most prestigious thing he's ever done, which was guest teacher in the startup Ignition boot camp.
00:03:46 - A
Oh, yes. Yeah, it's true. Yes.
00:03:49 - C
He would come in and teach cap tables and how to use the cap share software and how to huge supporter.
00:03:56 - A
Back in the day when you were doing cap.
00:03:57 - C
Then he got too successful in business and he didn't teach me.
00:04:00 - A
Yeah, sorry.
00:04:01 - B
Happy to come back sometime.
00:04:03 - C
There we go.
00:04:03 - A
Thank you for coming on the podcast. We appreciate it, Matt. Okay, so I do an icebreaker. We do an icebreaker with every single guest, and we're gonna do a fill in the blank icebreaker today. Okay.
00:04:13 - A
So I'm gonna read you something and I want both of you to tell me what that blank should be. Okay. It can be one word. It can be a paragraph. It can hopefully not take three minutes of explanation, but you can fill it in with whatever you want.
00:04:24 - A
Okay.
00:04:25 - C
All right, let's go.
00:04:25 - A
Okay, here we go. The first one is, the real reason founders love AI so much is because blank.
00:04:35 - C
Because it can take tedious tasks and make them faster.
00:04:41 - A
So efficiency then.
00:04:42 - C
Yeah.
00:04:42 - A
How about you, Matt? The real reason founders love AI.
00:04:47 - B
It'S at what it does. It's so good.
00:04:53 - A
Yeah.
00:04:54 - B
And I'd say it's magical.
00:04:55 - A
Yeah.
00:04:56 - C
Yeah.
00:04:56 - B
Because as a founder, you're solving these, like, hard problems.
00:05:01 - A
Yeah.
00:05:02 - B
And so having those moments where AI comes in and assists. And assists is awesome.
00:05:08 - C
Yeah. And what? Like yesterday I had to do something and I wanted to run simulations, and I don't like it, given all the fluff explanations. So I said, I don't want any fluff. I just want you to give me results. I want you to run like a hundred simulations in the background and then analyze the results and tell me the outcome.
00:05:24 - C
And it did it and it does it. If I had an assistant have to go do that in a spreadsheet. Oh my gosh.
00:05:32 - B
My wife is working with her father on improving some things on his business. He's got a small business selling grain and she's helping with his website. And she hasn't built a website before or anything like that, but with like tiny bit of guidance from me.
00:05:51 - A
Yeah.
00:05:51 - B
And then just talking to the AI.
00:05:54 - A
Yeah.
00:05:55 - B
All day type of thing. She's made more progress than I would have made after like a couple years of college.
00:06:00 - A
Yeah, yeah, yeah. So are you, are you technical? Are you like a technical co founder? Probably not, no. So you're. You are the business side and the marketing side, sales side or what do you focus on?
00:06:14 - C
So.
00:06:15 - B
And Jaron. And I'm sure we'll talk about Jaron more later. He's awesome.
00:06:19 - A
Yeah.
00:06:20 - B
Like you say, brother, it work. Marriage is probably the best. You know, kind of compare comparison there. But we're odd compared to a lot of founders because I think we kind of split up this the CEO side. Jaron's always been the CEO and rightly so, but we would always have a technical co founder that we would bring in for what we were doing.
00:06:49 - B
But I tended to be the more grounded and more boring of the two co founders on the business side.
00:07:02 - A
Yeah. Doing the nitty gritty stuff behind the scenes where Jaron's probably up on stage. Rah, rah. Hey, let's fundraise. Hey, let's push this sales thing.
00:07:10 - A
Let's do this. And you're back there. Like, here's the analytics, here's the analysis, here's what we need to be doing.
00:07:15 - B
I think the most generic exact comparison that people would kind of gravitate to. Well, is it's kind of a Steve Jobs to Tim Cook.
00:07:23 - A
Yeah, yeah, yeah.
00:07:23 - B
Type relationship as far as like the team internally tends to know me a little better than Jaron as far as like interactions on that side. But it's. It's finance and bi and legal and HR and you know, post close stuff.
00:07:40 - C
So back to AI though. I think it's that efficiency and just what you can do with it. It's. I mean it. There's so many things.
00:07:47 - C
One.
00:07:47 - B
Yeah.
00:07:47 - A
100. Okay. Another. Fill in the blank. You ready?
00:07:50 - A
The worst cap table you've ever seen was blank.
00:07:55 - B
So I won't name the company.
00:07:56 - A
Do not name names. Do not name founders.
00:07:59 - B
I won't name the company.
00:08:00 - A
There's some horrific cap tables out there.
00:08:03 - B
But it was a local company and I worked, I worked with them personally because no one else could kind of like wrangle it.
00:08:13 - A
Yeah, we've seen that before.
00:08:16 - B
It had, it had 16 classes of preferred.
00:08:21 - A
16 classes. Okay, I've never heard of 16 classes.
00:08:28 - B
And they interacted. So like, I've always been an advocate that it's possible to like waterfall distribute out. Like, hey, if a company exits, like, you can go through like the waterfall. The waterfall. And people would push back on me and say like, no, because if someone makes a choice, it's like, well, if everyone is logical and optimizes their choice type of thing, then it really can like float.
00:08:51 - B
Not on this one. Yeah, it was like, it was very circular as far as the logic on.
00:08:57 - C
I'm going to be an acronym police here by just saying it's not an acronym, but it's a term waterfall. So to our viewers and listeners and, you know, or, you know, mostly, you know, budding entrepreneurs and those interested in entrepreneurship in the early stages, waterfall is actually something that happens at the end, very end of your entrepreneurial journey. Sometimes on the very last day before you turn the keys over to somebody else, where they say, okay, somebody's buying my company. And you have to calculate how the money's all going to be distributed to the ownership. And that's called the waterfall.
00:09:28 - C
And that waterfall can be quite complex. And this one you just said sounds nightmarish.
00:09:35 - B
It was a nightmare. And the biggest thing that made it a nightmare was kind of everyone at the table wasn't professional. So it's like it's attorneys who aren't corporate startup venture attorneys aren't venture attorneys. And a founding team that's never been a founding team before. And so every.
00:09:59 - B
And investors that weren't typically startup investors. And so everything was custom negotiated, just hodgepodge. Yeah.
00:10:07 - C
So just another lesson. We talk about this all the time, but bringing it up. When you're a startup and a founding team, all attorneys can spin up an entity, a C corp, an llc, whatever, but you need a venture attorney to do the latest things in the venture world and get it done right and make sure things are clean. And that's what you're saying. It's attorneys that don't know the venture world can mess things up big time.
00:10:32 - C
It's just like we say, it's like a doctor, you don't have a neurosurgeon, fix your knee, you don't have an orthopedic surgeon. Fix your brain tumor.
00:10:39 - A
And I do want to give you a chance to answer the question.
00:10:41 - C
I can't compete with 16 classes of preferred stock.
00:10:44 - A
But I've seen our hat to Matt.
00:10:46 - C
But there's nightmarish ones. I do it in the boot camp. You've seen one. There's a company here also in Utah that one time faced such a cram down that the founders and employees stock options and the founder stock went to nothing and they all had to be optioned back up after a big massive cram down and those kind of things. So you look at the captive and go, how come the founders only have options and no actual stock?
00:11:11 - C
You know, and, and you, you know, you see things like that. But 16 classes of preferred stock, my.
00:11:16 - A
Gosh, I don't know what investor even allowed that to happen. That was crazy. Like why would you invest after seeing the 15 classes? And you're like, oh, I'll be the 16th class.
00:11:26 - C
It's kind of related to cap table though also when you see, okay, this person's bought common stock and they've. It says on the cap table there's just common stock, but there's no footnotes. Well, they have anti dilution rights that they've been granted. You need to put that on the cap table. Right.
00:11:41 - C
That there's anti dilution rights. But that kind of messed up stuff as you go in and you're. People don't understand. You founders need to understand you're selling securities as a founder and there's securities laws when you put a cap table in which you found a cap share, a cap table company, a cap table to an investor or to somebody saying this is my ownership structure and it's missing information that is material to the actual ownership of the company. That is securities fraud.
00:12:11 - B
Yeah.
00:12:12 - C
And you have to be very careful. Right. And that, and that's why your software was like one source of truth for a founding team. So they didn't mess themselves up.
00:12:20 - B
Yeah. And, and I know we're going deep on this now.
00:12:23 - A
You're good.
00:12:24 - C
This is good stuff.
00:12:25 - B
Get off it on a second. But what I'd say, because I hear us talk here and I know the founders that are saying, yeah, but guys like I can't afford that.
00:12:34 - C
Yeah.
00:12:34 - B
Like I just, you know, took all my SA savings, you know.
00:12:39 - A
What do you mean? Afford the legal work to do it properly.
00:12:42 - B
Like I can't afford to do it. Right.
00:12:44 - A
Yeah.
00:12:45 - B
And boy, I can sympathize with that and have gotten trouble myself for not affording to, you know, but what I Will say is there are awesome libraries online of template startup docs that you can follow that do a good job of like, look, it'd be better to have an attorney do something, but those template docs are going to be a lot better than getting your brother.
00:13:10 - C
Can you say this though? If there's one, if there's one place not to skimp, it would be with the founding and making sure the cap table is right.
00:13:18 - B
Right? Generally, yes. And, and the other thing that I would say is with a good team, there are amazing law firms, really prestigious law firms who will waive fees until your first round or delay fees at a minimum and things like that. That can also go a long way.
00:13:38 - C
Yeah, yeah.
00:13:39 - A
Okay, next, fill in the blank. You ready? This one's non business so maybe we don't go as deep into this one. When you turn on your TV tonight, you all should be watching blank. What are you guys watching? The truth comes out.
00:13:53 - C
I watch YouTube and catch up on the day's news through YouTube now more than anything because long form news programs on whatever news channel you watch for me. So I go to YouTube and catch up. Like the last few nights, one of my first things do, I turn on the TV and I'm watching the updates on what's happening in Iran because it's historical.
00:14:12 - A
Wow.
00:14:13 - C
Yeah.
00:14:13 - A
How about you, Matt?
00:14:14 - B
John's got a better answer than me.
00:14:16 - A
When you, when you turn on your TV tonight, you should be watching Blink by the way, I was thinking like a binge a show or something.
00:14:23 - C
No, but you got to understand and I saw what happened in 1979. I was actually just coming into adulthood in 1979 and you know, our embassy was taken over and they held kidnap, they kidnapped 400 people for a year, you know, and stuff like that. And now that whole regime that did that is in the process of being overturned and it's crazy what's happening and it's so for me, I, it's. I, it's. But what the point there is YouTube, I YouTube.
00:14:53 - C
I'm paying now not to have the ads which makes YouTube enjoyable instead of annoying. And that's how I catch up on stuff.
00:15:00 - A
It really?
00:15:00 - B
Yeah, yeah, it's awesome.
00:15:02 - A
How about you, Matt?
00:15:03 - B
I'll be lighter hearted.
00:15:04 - A
Yeah. I was like, let's turn the mood around in here.
00:15:08 - B
But Avatar, the Last Airbender. Yeah. I love cartoons.
00:15:13 - A
Oh, I like anime.
00:15:15 - B
Yeah, a little bit, yeah.
00:15:17 - A
Wow, that's cool.
00:15:18 - B
No, I, I like easy, I like soft. The. The world is hard enough.
00:15:22 - A
Yeah. So honestly I've never watched Any of those shows, but they're highly rated on like IMDb and Rotten Tomatoes. They're like the highest ranked shows. They're great. Yeah.
00:15:32 - A
So, all right, I might have to give it a try on Matt's recommendation.
00:15:35 - C
So now that it's a binge, what are your two best binges lately?
00:15:40 - A
I. I'm really liking the Taylor Sheridan shows. Have you like Yellowstone? Oh, those and 1863 and all that. Well, and. But he.
00:15:49 - A
There's one I looked up on IMDb and rotten tomatoes and his highest ranked one is called Lawman Bass Reeves. And it's about the first black U.S. marshal in the territories.
00:16:00 - C
Oh, really?
00:16:00 - A
And it's a really good show. And I was like, why is it so highly rated? Higher than Yellowstone and these really prominent shows. I'm like, wow, let's watch this one. So me and my wife have been watching that and it's really good.
00:16:09 - C
How about you? What's the binge?
00:16:10 - B
It's awesome. I mean, I go back to things like Big Bang Theory, Parks and Red.
00:16:15 - A
Yeah.
00:16:16 - C
Yeah.
00:16:16 - A
Okay. The classics.
00:16:17 - C
Yeah.
00:16:17 - A
Yeah. Okay, here we go. I'm going to do another one. Maybe two more. The key for a founder to get his startup acquired is blank.
00:16:30 - A
The key to acquisition or getting acquired is blank.
00:16:36 - C
Revenue. Revenue. Revenue.
00:16:37 - A
Revenue. So revenue cures a lot of. A lot of woes.
00:16:40 - C
Yeah. And just that you have. You become an acquisition candidate, in my opinion, when you hit certain revenue levels. Because that's what the. There's, you know, believe it or not, there's a massive ecosystem of scouts that help large companies find acquisition candidates.
00:16:57 - A
Yeah, no, yeah. And.
00:16:58 - C
And until you hit those metrics, you don't rise onto the radar.
00:17:03 - A
I don't know about you guys, Matt, but my company, when we sold, we were first headhunted by some random firm. Some random accounting firm was like, hey, we want to talk to you. And they were asking for access to financial documents and stuff. And we're like, why would we give you random Joe Schmo? And then later we finally engaged in a month later, Billion dollar company. They had a multibillion dollar company behind them.
00:17:25 - A
Like, oh, this makes sense. So, yeah. But I. Okay. How about you, Matt?
00:17:29 - A
I'm interested because, I mean, Spiff sold for what? The Salesforce is public. It was 400 million. Was it?
00:17:34 - B
Yeah. So it was like 420 million that didn't include the cash on our books that redistributed to investors. So it was almost 480 million with that.
00:17:43 - A
Wow.
00:17:44 - B
So, yeah, it was.
00:17:45 - A
So what's the key? What's the blank.
00:17:47 - B
I mean I agree with John Revenue 100% that real progress.
00:17:53 - A
The world runs on money. You have to make money to get money.
00:17:57 - B
But for something a little bit more, I guess not non obvious something that, you know, founders may not think about for in both with Spiff and capshare, I would say that building beginning with the end in mind of like knowing that this was a possibility and something that we should be encouraging along the way. So often there's a like, no, don't talk to me. I'm building this business. And you can engage and talk and say no, but we'd love to stay friends and build those relationships over time. That goes a long ways.
00:18:41 - B
The other part of that is I think often founders will say no prematurely where they're like, well we're not going to sell, so no. Where the right answer is often a hey, we're excited about what we're doing right now. I'm not sure that now is the right time, but we'd love to talk and spending you got, you can't let it balloon and take you away from like building the business which is most critical. But spending 5 to 10% of your time at any given time on some of that will pay off over time.
00:19:16 - A
So to summarize, your answer, is it, is it to prepare keeping the future mind and prepare for the future and keep an open mind. I love that answer because it also it correlates with your answer on on cap tables is, hey, build this thing like you're going to be successful, like you're going to have a future of success and then you will have a future of success. It's the same thing with entity structure, cap table management or acquisition possibilities and frameworks. So I love it. Okay.
00:19:46 - B
And we had every intention to take Spiff public. Yeah, that was kind of the goal. The chip on our shoulder that we want, you know, but we still kind of cultivate it. I Salesforce invested in our series B, led our series C before eventually acquiring us. And so there was relationship building going on there for like three or four years for an option that ended up materializing.
00:20:08 - B
So like.
00:20:09 - A
Yeah. Which is another talking point for later in the podcast too. I'd love to pick your brain on that because that's interesting as well, like getting, you know, you know, an investor to actually be a potential inquire acquirer. Right.
00:20:21 - C
Okay, one more.
00:20:22 - A
Yeah, one more and then we're done. If I weren't a tech entrepreneur, I'd probably be doing blank. If I was not a tech entrepreneur, I'd probably be doing blank. What do you guys. What are you filling in the blank?
00:20:39 - C
Well, I might be another kind of entrepreneur.
00:20:41 - A
Okay, so. Okay. If you weren't an entrepreneur, I would be doing blank.
00:20:47 - C
Well, either. Medicine. I actually want to be a doctor. I was accepted to medical school, but ended up not going and becoming an entrepreneur instead. Or a teacher, because I love teaching.
00:20:58 - A
Teacher. Okay. How about you, Matt?
00:21:00 - B
I mean, I left Salesforce a year ago. I'm full time dad 80% of the time right now.
00:21:06 - A
Oh, wow.
00:21:07 - B
So I am, for all intents and purposes, right now, I'm a stay at home parent.
00:21:11 - A
Yeah.
00:21:12 - B
But the other 20%, I am coaching on a few boards and teaching. Yeah. So the teacher thing, I did.
00:21:21 - C
That's why you like doing it with us. And I did.
00:21:24 - B
I debated leaving college if I wanted to just do the, like, Master's and PhD and go very, very academic. I like the teaching thing.
00:21:32 - C
Yeah, yeah.
00:21:33 - B
So teacher.
00:21:33 - A
Yeah, teacher as well. Wow, that's interesting. Well, great. That was my fill in the blank game.
00:21:38 - B
Awesome.
00:21:39 - A
I think it took like 20 minutes, but hey, it's okay. I loved it. A lot of teaching principles in there. A lot of awesome frameworks. Okay, now I want to get into.
00:21:47 - A
Did you want to say something?
00:21:48 - C
No.
00:21:49 - A
Oh, I thought you were about to say something. I wanted to get into your background, Matt. Like, where it all began. You have these awesome acquisitions under your belt. Again, we just talked about it.
00:21:59 - A
You just expressed that it was around 420 on paper, but really 480 behind the scenes. $480 million acquisition to Salesforce. Where does it begin? Like, where did you grow up? Where did you go to school? I know that you guys. Have you talked before the podcast that you were guests.
00:22:17 - C
A lot of people wonder how we know our guests and stuff like that.
00:22:19 - A
Yeah. Yeah.
00:22:20 - C
So Matt took my creating new ventures class at the university level, and it was kind of a class that was hard to get into. You had to matriculate into a. Hard to get into a university. You had to then be in the business school and then accepted into the business program, and then you had to wait till your senior year and that's when you took it your senior year.
00:22:43 - A
So it was a 400 level class. In the business school.
00:22:46 - C
In the business school. And it's similar. You're now teaching a similar class.
00:22:50 - A
Yeah, mine's in your science department at high school.
00:22:53 - C
And he's kind of following my footsteps in some ways, and so it's kind of fun. But yeah, that's when Matt and I met and took that class and then he started his entrepreneurial career and we stayed in touch. And then when he started Cap Share, he came in and helped us and Startup initiation, that's how we got to know each other even better. And that's kind of that history there a little bit. But before that.
00:23:14 - C
Yeah. Where did you grow up and how did you find your. What was your major at byu?
00:23:18 - B
It was entrepreneurship.
00:23:19 - C
Yeah. So Matt. Business Management. Entrepreneurship.
00:23:21 - B
Business management.
00:23:22 - C
It's now its own major.
00:23:23 - B
Entrepreneurship emphasis. Yeah.
00:23:24 - C
Okay, so that's what I did too. So before you, how did you choose that and what made you choose that? What's your pre declaring that major? History.
00:23:32 - A
So I mean, how old are you? Are you my age or you?
00:23:36 - B
I don't know. Third. I'm 38.
00:23:38 - A
I'm 38. What year did you graduate high school?
00:23:42 - B
2005.
00:23:43 - A
Okay. I was. 06. Okay. Wow.
00:23:46 - A
Yeah. Is Jaren our age or Jaron's older?
00:23:49 - B
Jaron's 13 years older.
00:23:51 - A
Yeah, I was gonna say I knew. So I just associated you at Jaren's age.
00:23:54 - B
Well, we, I feel like I. We play a fun game where we'd ask people on our team who they thought was older.
00:24:01 - C
Yeah.
00:24:01 - B
And 70% of the time they got it.
00:24:04 - C
Man.
00:24:04 - A
I think we were in a few classes together.
00:24:07 - B
We could have been.
00:24:07 - A
I think we had to have been. There's no way we weren't. Okay. Wow, that's funny because that's your major. Yeah, exact major.
00:24:13 - A
And I took his class, you know, like three times. But yeah.
00:24:17 - B
Yeah, that's awesome.
00:24:18 - A
Yeah. Okay, go on. Sorry.
00:24:20 - B
So, I mean, going rewinding backwards. Um, so I did have the example that my dad had his own business.
00:24:29 - C
Yeah.
00:24:30 - B
That he was running with a brother and it was construction software.
00:24:35 - C
Where was this at?
00:24:36 - B
Where did you grow up here? Locally? Utah Valley.
00:24:39 - C
Okay, got it.
00:24:40 - B
Okay. So I went to Pleasant Grove High School. Oh, grew up in Gee.
00:24:43 - C
Yeah. Okay.
00:24:45 - B
So I had that, that example I loved. I was the weird kid that kind of loved business as like a 14 year old, 10 year old. I, you know, wanted to create like a scooter park is, you know, like 10 year old Matt type of thing. And so in high school I took the business classes they had. There wasn't much of it and you know, it was questionable as far as the quality of some of this stuff.
00:25:12 - B
But I started a company, I own Teen Tutors.com and started a company that was teenagers tutoring other teenagers. And so I'd go to parent teacher conference with like stacks of flyers that I printed out And I just put them on teachers desks so that like, when they're meeting with parents for parent teacher conference, it's like, oh, if you're the Airbnb of tutorial type of thing, like, here's a number that you could call. These guys are great.
00:25:40 - A
I love that.
00:25:40 - B
Yeah. And I made no money at it. Not. Not really type of thing, but went through the process of like setting up a bank account and setting up like a. And a lot of that helped me later because there's certain walls that people have a hard time with, like, well, how do you do that?
00:26:02 - B
Where do you start? Type of things that people get stuck on. And that was a great experience for kind of learning some of that. So, yeah, I. So I had. That was very like into the entrepreneurship.
00:26:15 - A
Path so that when you went to. So when you went to college, you were very much. I set on. I'm going to be an entrepreneur. I'm going to be a business owner.
00:26:23 - B
Yeah.
00:26:24 - C
When did you. How long before you declared the major of entrepreneurship? What?
00:26:29 - B
I. I mean, I, I took. I was accepted into the business school while I was at the mtc.
00:26:38 - C
Oh, really?
00:26:39 - B
So I did one year and then was accepted into.
00:26:42 - C
You went to serve a mission for.
00:26:43 - B
The church and went to a mission for the church.
00:26:45 - C
So you did your freshman year and you did that and then you found out when you got back you were going to be in the business school.
00:26:50 - B
Yeah, yeah. So I deferred at that point. And then I was at school for two more years after my mission, but I'd kind of declared that that was my intended. The entrepreneurship thing.
00:27:01 - C
And. Which was your favorite class?
00:27:05 - B
That's a good question.
00:27:06 - A
That's a loaded. That's a loaded question.
00:27:08 - B
That's okay, I can dodge a little bit. There's a communications class that's an. Kind of an entry level communication, like, business communications class that I happened to get the guy who wrote the textbook. Yeah, that was phenomenal for me.
00:27:22 - C
That's awesome.
00:27:23 - B
Because he. He focused on things like. Like, I hated writing, but he focused on things like, no, we're not doing long papers. Like, if you can do this in like two paragraphs, do. Because the entire point was like business communication being concise.
00:27:36 - B
And that ended up being a super, super helpful.
00:27:39 - A
And now I does it all.
00:27:41 - B
Yeah.
00:27:41 - C
Do you remember. Do you remember how you had to take those weird 3 class into the business school though? Like economics and something.
00:27:49 - B
I loved that economics class.
00:27:51 - C
Yeah. The 1:10. But there were two others. Calculus. You had to have calculus.
00:27:54 - C
I remember. Right. You know Some kind of math thing. Because now they've made the prerequisite classes more business oriented.
00:28:00 - A
Really? Oh, that would have been glorious for me. Oh my goodness.
00:28:05 - B
Math has always been my thing. I was going to say the other class was probably financing new ventures.
00:28:09 - C
Yeah.
00:28:10 - B
And I always, I mean I'm kind of the like I was CFO for Spiff, you know. So the number side has always been kind of. Yeah. Interesting for me as well.
00:28:18 - C
Yep.
00:28:19 - B
And so that financing understand. I mean that's where I first heard what a cap table was.
00:28:24 - C
Yeah.
00:28:24 - B
You know, some of those things was kind of.
00:28:26 - A
So how do you jump to what was your very first thing was capture your first thing? No, because that was much later.
00:28:32 - C
Did you start anything in college?
00:28:34 - B
I tried a couple times weekly. Nothing notable.
00:28:39 - A
What was your first real like, okay, I can make a living from this thing. Venture.
00:28:44 - B
Well, and I will say that like I struggled because I graduated quickly. I got married my senior year and so everything all of a sudden kind of hits the fan as far as a. Like, what am I going to do with my life? And so I, I iterated through a few things that senior year trying to figure it out. And one thing. And the school may be better now, but one thing that I kind of struggled with is I asked a couple of my teachers like, hey, so if I'm interviewing for this job, like do you have any advice for me?
00:29:15 - B
And I got the feedback like, you shouldn't be interviewing, you should be hiring. It's like, well, yeah, but I'm 22.
00:29:22 - A
Yeah.
00:29:22 - B
And like, I don't know, you know. And so like one of the things that was. So I didn't know what I was going to do. I ended up. It was also right after the economic slump.
00:29:34 - C
Yeah.
00:29:34 - B
Where you know, 2010. And so things were starting to come back. But hiring out of colleges was really, really low when I graduated. Yes.
00:29:42 - C
Yes.
00:29:43 - B
And so I graduated with two internships. 20 hour a week internships. One was paid, one wasn't. I ended up turning one of those. The one that was probably more in my interest was a company called Funding Universe.
00:30:04 - C
Oh yeah.
00:30:04 - B
That converted to Lendio, which is now.
00:30:06 - A
Yeah.
00:30:08 - B
Huh. And so that was one of the internships and I was on. They had an equity team that would match make entrepreneurs with angel investors. And so I was on that team as an intern. Eventually it turned into a full time job.
00:30:25 - B
Really low paying for full time. I think I was making like 30, 35 grand a year thing and was just excited that it was a sal and like real.
00:30:35 - A
Hey. Back in Those days that, that was entry level pay, like people have probably shot 30,000, but that's. I know, yeah, shows our age, I guess.
00:30:44 - B
And then they converted to lendio, which was all focused on the bank side. I wasn't on the bank side team. And so I got laid off. And so then I kind of scrambled trying to figure out what I was going to do next.
00:31:00 - A
What, what's timeline here?
00:31:01 - B
Like what was 2011?
00:31:03 - A
2011.
00:31:04 - B
So 2011 got laid off, start of the year, scrambling, trying to figure out what to do next. I'd been introducing entrepreneurs to some of these like angel investors and seed funds. And so I reached out to them because I. One of the things I was interested in in college was like maybe I'd go into vc. And I remember saying that in one of my classes and an MBA student, he was like, well cool, but what's your real plan?
00:31:28 - B
And I didn't understand what he meant until he explained like saying that you want to go into VC is like saying I want to get into the NBA, you know, like as a basketball player. He's like, that's great. But like, what's the real plan?
00:31:40 - A
Yeah, yeah.
00:31:41 - B
And so I was like, well, maybe I'll go talk to these guys. And I had one fund say, Matt, we'd hire you if you had any finance experience, particularly any valuation experience. So I was like, okay, I'll go get valuation experience. So I looked up like valuation company in Google and I think I got a list of like 13 in the country. I was like, okay, well there's my calling list.
00:32:07 - B
And so I reached out to those and one of them happened to be based in Utah and they took a meeting with me and the answer I got was, Matt, we're not hiring. But you're smart. If you want to dial for dollars for us, we'll pay you commissions on anything you close. So no salary or anything, but we'll pay.
00:32:29 - C
What were they selling?
00:32:30 - B
Commissions, Valuation services. So this is like 409A valuation. Yeah, you know, and other types of things. But it's places where for tax and accounting reasons you needed to evaluation of your company.
00:32:43 - A
Yep.
00:32:45 - B
Scalar analytics. Yeah.
00:32:47 - A
Oh yeah, we know.
00:32:49 - C
Yeah.
00:32:49 - B
So. So I met with them. They're like, if you want to dial, we'll pay you commissions on anything that you close. And at that time, everything about sales seemed sleazy to me. See, you know, like all I knew from it was a very like sales culture in college of the door to door sales and I'm this more financy guy that like so everything about it I was like, I don't want to do that.
00:33:16 - B
But I wanted into the company. So I said yes. And the next three years were the best for my career.
00:33:22 - C
Really.
00:33:23 - B
That sales experience was absolutely life changing.
00:33:27 - A
So you forced yourself to do it.
00:33:29 - B
So I forced myself to do it. The plan was to only do it for like two months to kind of keep my, keep something on my resume so I didn't get at it.
00:33:36 - A
Is that why you stayed so long? So you were making money?
00:33:39 - B
I mean, and it took. I enjoyed the culture. There are a few things about the culture there that I loved. And then it. But it took me.
00:33:47 - B
I got my first paycheck there five and a half months in which we're young, you know, we're living on Ramen at the time type of thing. But I got my first paycheck my first year there. I think I made 25 to 30 grand type of thing. So I, you know, started to pick up the second half of the year. But the next year I made 70 and the year after that I made 120 and the year after that I was on Track for about 220 which was really good back then.
00:34:17 - B
Oh my gosh, 100% commissions.
00:34:20 - C
Yeah. Wow.
00:34:22 - B
So it was all just kind of pay for what you kill. But the founder was a guy named Jaren Paul and Jaron. He'd started it. He then left for seven years to actually work in VC and then came back. But immediately he started looking for software that he could build.
00:34:45 - C
Didn't Jaren worked side by side with Jeff Kroll at vspring?
00:34:48 - B
He did, yeah.
00:34:49 - A
That's where he went and did. Yeah, he told us that story.
00:34:52 - B
And so he started capture as an internal kind of project at scalyr. I loved the startup thing. I love the math of a cap table software. The math of the cap table like all of that I loved. And so eventually he sold and I helped him kind of on that sell process.
00:35:13 - B
But he sold. He sold Scalar analytics to focus on capture full time and that's kind of where we took off with capture. But that experience selling like the amount that changed me from a relatively bookish like accountant and kind of turning your.
00:35:30 - C
Nose up at sales.
00:35:31 - B
That's beneath me to like understanding and appreciating just how hard sales is and.
00:35:38 - C
How it's the lifeblood. Yeah.
00:35:40 - A
And it is. Would you recommend that, that you know, early stage founders or you know, budding founders who are thinking about starting a company or even in the process of founding their company that should they take like almost a sabbatical like you did and go force themselves to learn sales somewhere.
00:35:58 - B
I mean you tend to have two types of founders. You have sales founders and you have product founders. The general rule of like a simplification.
00:36:06 - A
But that's generally true of the co founding team. Yeah.
00:36:11 - B
And what I would say is whether regardless of who you are or where you are on kind of any spectrum as a founder, I have a few companies that I work with right now that I recommend that they play SDR bdr, meaning that they dial unknown, you know, type of thing.
00:36:34 - A
Just cold call.
00:36:35 - B
Cold call. Do a hundred calls a week for the next month or two because there's so much you learn about your own business, there's. So even if they're not going to go take a sabbatical type of thing, learning to get out and talk to people. Yeah, super.
00:36:52 - A
A crucial skill. Yeah, yeah. We always say that, especially in the companies that we're funding because we now run startup Ignition Ventures, which is a pre seed fund. Anybody that we invest in, we're like the CEO founder needs to be owning the sales process. Do not pass that baton too early because we just see train wrecks happening.
00:37:12 - A
So a huge requirement for our funding is you gotta sell, you have to founder led sales. Founder led sales. Yeah. So, okay, cool. So now I know how you met Jaren and he's 13 years older than you.
00:37:23 - A
I'm like, how did you and Jared become buddies?
00:37:25 - C
Yeah, I'm a little question there on that. So he's 13 years older, he's the founder of Scalar analytics and he's selling the company and you had become a top sales rep, I'm guessing. Okay. And he noticed that obviously along the way and that you were probably a good thinker, good math, whatever. And then so when he says let's take cap share and do something with.
00:37:45 - C
Because the acquirers of Scalar didn't want cap share.
00:37:48 - A
So.
00:37:48 - C
Right, so you took cap share and created a new company and he. Did he invite anybody else from Scalar or just you along?
00:37:55 - A
I was going to say. Who, who's the co founding team of capshare then?
00:37:57 - B
Yeah, so we started as an internal project. The guys that bought Scalar were a couple of the guys that were working there. So it was, it was kind of a management buyout. It was a management buyout situation there. They're awesome.
00:38:09 - B
Yeah, they were running the day to day on the scalar side at the time. So it's pretty natural for them to, you know, be able to take over the ownership there and kind of own their destiny there.
00:38:19 - C
Yeah.
00:38:19 - B
And they've done an amazing job. But we were building out this cap share internally and so I, there was a while there that I was just selling both depending on kind of the situation where it's like, hey, this is an opportunity to sell cap share. And Scalar wasn't built with like a marketing team. I mean this is a, this is kind of a financial services business. Like it's not the, the, on the tech side you end up having like very like functionally focused people and as you start to scale up.
00:38:56 - B
But there was no concept of like marketing at Scalar. So like I would, I'd find leads by watching TechCrunch for companies that had raised money, I'd reach out to them, I'd close, you know, so it was kind of all of the steps in the process and one of the things that I did there was automate myself out of a job where I, I would create email lists that were just, I was just using like canned responses and Gmail type of thing. Like, I didn't have like a HubSpot spot or more advanced thing that, that was like automating any of this, but it made it so that like that last year when I was on track to do really, really well at scalar, I was also only spending like 5 to 10 hours a week working on scalar for, for that because I'd automated my job a bunch. So most of my time then I could focus on selling capture and kind of helping with like product vision and stuff like that on that side. Because it was what interested me.
00:39:54 - C
Me. Yeah.
00:39:55 - B
And so that, that's kind of what.
00:39:57 - A
Got me into that, maybe for the audience. Why don't you tell them what capture was and it. Or even is and you know the basic product behind capture.
00:40:06 - B
Yeah, and, and at this point it doesn't exist.
00:40:09 - A
Oh, it doesn't exist.
00:40:10 - B
I'm not really like hawking a product. Yeah, yeah, yeah, unfortunately. But so cap, Cap share, we got the idea because we were doing these valuations.
00:40:22 - C
The class of product exists though, it's very important.
00:40:25 - B
Very important.
00:40:25 - C
Now went from a leadership position was acquired and the acquirer eventually just mothballed the product, right?
00:40:32 - B
It did, yeah. Yeah, effectively.
00:40:35 - C
Okay, but what tell everybody what the product.
00:40:38 - B
So a lot of people were keeping track of their cap table, who owns what in the company via Excel. And that was something that we needed to value the company because we were figuring out what a share in the company was worth. And so we needed their cap table and There were some details there. And all of the time there was data missing. You talk about the horror stories of selling a company and securities fraud type of thing.
00:41:02 - B
There's always data missing. So we saw an opportunity to create a product where it would help with that data fidelity, it would help with version control because everyone was just using the same SaaS cap table that they're logging in and kind of looking at all of the same details. And then there was some compliance things that you had to perform on your cap table that were like annual requirements and hairy and.
00:41:27 - C
And they would. They would start very easy. A founding cap table is three guys. They split up a percentage and have so many shares. Easy.
00:41:35 - C
But after a year or two of taking an investment, having an option plan, you know, and nowadays with safes and then there's convertible debt, all the footnotes you need to explain things that are contingent. Right. All that. That overwhelms the average founding team to.
00:41:52 - B
Do it in Excel, especially because it's not their expertise.
00:41:55 - A
It was cap table management software. But at the time, was there any other software like that out there? When did Carta enter the scene?
00:42:03 - B
Within months of us. We started within months of each other.
00:42:07 - A
Wow.
00:42:08 - B
So we were very competitive through that kind of. That process.
00:42:11 - C
Yeah, yeah. And that. And then the other ones came in much later. But you were one of the first ones to do it.
00:42:16 - B
There were. They were. For larger companies and for public companies.
00:42:20 - C
Yeah.
00:42:20 - B
There were products that. That existed, but kind of startup cap table, earlier stage type of thing. Nothing.
00:42:27 - C
And the rule of thumb was a startup could get that kind of software for free. That's how you did the loss leader to get them using the product. And as they grew, you got subscription revenue.
00:42:37 - B
We had a very effective freemium strategy.
00:42:39 - C
Yes.
00:42:39 - B
They could get in and once they got up to like 20 shareholders and.
00:42:43 - A
They had to start paying.
00:42:44 - C
So how long did. How long from the point. The month and year you started cap share, how long before you sold capture?
00:42:51 - B
It's probably six years total.
00:42:53 - C
Six years cap share. And then. And then who bought it?
00:42:57 - B
So it was a company called Solium.
00:42:59 - C
Yeah.
00:43:00 - B
Their main product was called shareworks.
00:43:02 - C
Okay. Oh yeah.
00:43:03 - B
They got bought about shareworks was pretty.
00:43:05 - C
Prominent in their field, wasn't it?
00:43:06 - B
And very good at what they did. They got bought about nine months a year after they bought us by Morgan Stanley.
00:43:14 - C
Okay.
00:43:15 - B
And Morgan Stanley. Shareworks is now Morgan Stanley's flagship product in the space.
00:43:21 - C
And they kind of just eventually petered out and mothballed cap share because they.
00:43:26 - B
Were so focused on the public markets.
00:43:27 - C
Yes.
00:43:28 - B
And we were very much like the earlier stage, the acquisition. The premise on the acquisition was that it was. It would be a feeder. As companies grew, they would grow into shareworks, which made sense. But once you had the bank behind it, that could bring it in with.
00:43:42 - C
With big clients.
00:43:43 - B
With big clients.
00:43:44 - C
So what did shareworks exactly do?
00:43:46 - B
Same thing.
00:43:47 - C
And it's still later stage.
00:43:48 - B
You just. If you're a public company and you give options to your employee.
00:43:53 - C
Yeah.
00:43:53 - B
You still have to track the vesting. All of that stuff still needs to be done. Yeah, Shareworks does. Does that.
00:43:59 - C
Yeah.
00:44:00 - B
So they have clients like SpaceX and Amazon and, you know, massive companies that.
00:44:05 - A
Are doing a ton of issuing. Yeah.
00:44:07 - C
And so was it sad to see eventually after time, and it seemed like it took a year or two or three before they mothballed, like four years. Was it sad when you saw mothball?
00:44:17 - A
Yeah, of course, guys. I mean, it was. It could have been the brand name that Carta is.
00:44:23 - B
Right? You could. Yeah. And Carta, I mean. I mean, we started at the same time when we sold Spiff was about 1/7 of their revenue, which I was proud of, given the cap share or. Sorry, cap share.
00:44:36 - B
Yeah, capture was about 1/7.
00:44:38 - A
I was like, you just skipped a couple years there, Matt.
00:44:40 - C
I know. Okay. Cap share was about 1/7.
00:44:42 - B
1/7 their revenue, which I was proud of because we had raised.
00:44:44 - C
Of shareworks, you're saying, of solium.
00:44:47 - B
Of carta. Oh, 1/7.7th of carta, which I was proud of because we'd raised 2 million during the same period. They'd raised 176 million.
00:44:56 - C
Yeah, yeah.
00:44:56 - B
And so we were competing in an environment where they were throwing 2.5 million a month at SEM.
00:45:03 - C
Wow.
00:45:04 - B
And we'd raised 2 million total in our existence. And we were direct competitors and they would love to have squashed us out. We actually started into the acquisition process from an offer from Carta.
00:45:17 - C
Yeah.
00:45:17 - B
So it was them that were like, okay, let's get rid of these guys.
00:45:20 - A
Yeah.
00:45:22 - B
That kind of prompted $170 million went.
00:45:25 - A
Into Carta in the same time, in that.
00:45:27 - B
In that period. And so, yeah, they out fundraised us. They saw a bigger market opportunity than we did. We thought we were going after a relatively niche market size.
00:45:37 - A
And they're like, no, this is every startup in the world.
00:45:41 - B
Something larger, to be fair, to get to the size that they've kind of gotten to, they had to tack together like 20 different markets. So they got into like, fund management and they got like, there's a lot of auxiliary Things, they're.
00:45:56 - A
They're our fund manager, actually. We use them for fund management.
00:45:59 - B
They do.
00:46:00 - A
Good. Yeah. So, okay, so you then sell the company that acquires you.
00:46:05 - C
What month and year was that, that you sold?
00:46:08 - B
That was. We sold in October 2017.
00:46:11 - C
Okay, got it.
00:46:12 - A
Was that a big. Was that a nice win? Was that. Yeah, yeah. Because that had to have been a great exit for everybody.
00:46:19 - B
So we, I mean, we, we sold for just shy of 20 million.
00:46:23 - C
Yeah.
00:46:25 - B
We hadn't raised, you know, we raised 2 million at the time.
00:46:27 - C
Yeah.
00:46:28 - B
And so relatively small, but it was life changing for me.
00:46:31 - A
Yeah, of course.
00:46:32 - C
So. And I remember going to lunch with you and Jaron at Tsunami in Lehigh restaurant, and you told me you were working on this thing called, called Spiff. And I had a lot of commission planning history in my career and all that. Should have invested. Yeah.
00:46:49 - C
I don't know if you let me or offered it to me. Maybe you did, I don't know. But that's cool. Yeah.
00:46:53 - A
So how did you transition over to Spiff? You and Jaren were like, right away, we're like, okay, we're done with capture. Like, let's get in this.
00:46:59 - C
Must have had a vision before because you were right on that right away.
00:47:01 - B
Right. So. And we were very explicit with Solium who acquired us.
00:47:06 - A
Oh, you had been developing.
00:47:07 - B
We were, we were very open with them. We hadn't been developing Spiff.
00:47:11 - C
Yeah.
00:47:12 - B
But we had the idea for it and we incorporated Spiff a day before we sold. And we told them we were, we were explicit, but we did it that way because of, like language in our employment agreements with them and stuff.
00:47:27 - A
And how did you have.
00:47:29 - C
Did you have to stay on? We did so literally just so our viewers and listeners know, when you sell a company, it's very common that the founders get an employment agreement for one or more years. But usually the founders don't stay there very long. In my experience. Actually, sometimes a few months, they are gone. But the acquirer wants the continuity for at least a few months.
00:47:53 - C
Right.
00:47:53 - B
And you want to do right by.
00:47:54 - C
Them and you want to do right. And you want to do right because they're buying and giving you money for their company. But so what was your agreement in selling cap share? For how long were you going to stay?
00:48:03 - B
Jaron was going to stick around for a year and I was going to stick around for two years.
00:48:07 - C
Two years.
00:48:08 - B
And that was.
00:48:09 - C
That was by agreement.
00:48:10 - B
That was by agreement. And I committed to the two years in order to help Jaron roll out.
00:48:15 - C
So the buying company allowed you to work on the side on Spiff. Yep. And up front. And by the way, and that's very important to do this to our viewers and listeners, if you try to do that in stealth without telling them there's.
00:48:33 - A
That IP risk, they would own a lot.
00:48:36 - C
There's all sorts of moral and legal and financial risk. So people don't understand that, but if you get approval, everything's fine.
00:48:46 - B
Yeah, well. And beyond the like, there's always the concern of, like, well, what if they own your ip, you know, type of things. And, and my experience, I haven't had the experience of like an acquirer going after random ip. What was really important because we were so upfront with it. When our series A for Spiff came around, the investors were nervous about the overlap there and the like, do we own the ip?
00:49:11 - B
Because we're not going to put a bunch of money into this company where there's this risk around the ip. And we'd been up front and clean enough about it that the CEO of Solium wrote a letter saying they're good, saying, we have no claim on the.
00:49:29 - C
Ip, by the way, as venture capitalists and as an angel investor, we have to do that a lot. Yeah, yeah, yeah. And so. Yeah, that's cool. So you did that and then Spiff.
00:49:38 - C
Tell. Tell us about Spiff. What was the genesis of the idea and what problem were you trying to solve?
00:49:44 - B
So, I mean, we saw, we saw. We had our sales reps at capshare who. We noticed that Salesforce was our CRM and we noticed that it was really common that they'd have Salesforce up and then a spreadsheet up on. We. They'd have a couple screens sitting there at their computer and they'd have Salesforce and a spreadsheet.
00:50:12 - B
And when we dug in to understand what that spreadsheet was, the explanation they'd been sharing around one, that someone had made a template and then they'd kind of like copied it to other reps.
00:50:22 - A
Reps, but to calculate their commissions.
00:50:24 - B
Yeah, yeah, because we pay them their commissions, but we'd pay a month later after finance had had a time to collect like all the info and close the books on the month. And so then we'd send them a commission statement and they'd argue about like, well, where's ABC co? And like I was supposed to get half a cut for so and so because they were out and, you know, I took type of thing and so.
00:50:48 - C
Chargebacks, all these issues.
00:50:50 - B
And so they track it themselves so that they could argue with us. But Also because like I said, I did three years in sales. Sales is hard. And so it was motivation. That other screen it was, it had the deals they'd close, but it also had a, like, if I can close this company, that's twelve hundred dollars for me.
00:51:12 - B
And so they'd have that sitting staring them in the face to keep them motivating and working and keep the smile on and you know, a lot of things that were hard there. And so we saw an opportunity to create software that would Sassify.
00:51:30 - C
Sassify that issue. Yeah.
00:51:32 - B
We also liked the fact that we were still selling into the finance team, which we knew and we were replacing something that finance was currently doing in Excel, which was a little bit of a thing for us, Cap share. We were replacing cap tables that had previously been.
00:51:47 - A
I'm saying I'm recognizing a pattern here. Like you are your kind of missions or your, your, I don't know, your attack on the business world is Sassifying financial things that are usually done Excel spreadsheets. And you just went and created a, a cloud SaaS product for it. Like, do you feel like there's opportunities around that, that even exist today for like the entrepreneurs listening that are in earshot of this podcast, that there's opportunities to still go and tackle that kind of potentially?
00:52:24 - B
I think if you take that narrow of a lens on it, then you get into just a couple narrow things. Because at this point a lot of that has been sassified. Yeah, it's been sass and beyond that. I do think in a lot of industries we're moving beyond SaaS and you know, to more and more AI solutions that fundamentally behave a little bit different.
00:52:45 - A
Right.
00:52:45 - B
But I do think this concept of taking something that in a business setting is being done in a very manual way, whether it's Excel or whether it's a multi step slack chain, the, you know, and figuring out a tidier solution, there's places that, that'll pay.
00:53:06 - C
Let me comment one thing though. We still see though to this day almost every week, pitches from entrepreneurs or just being out in the venture world where there are still amazingly complex or important, very vital to an industry processes done in Excel. It's unbelievable. Still, still today we are in 2026 and literally recently Tyler and I are very aware right now of and I'm talking in massive industries, massive sectors of the economy where huge issues are done in Excel. And it's crazy to this day to think that.
00:53:50 - C
So my answer and what you're saying a little bit, there's still a Lot of opportunity. And obviously every SaaS company is going to employ AI.
00:53:59 - B
Yeah, okay. Yeah.
00:54:00 - C
So, but the whole concept, this is where I don't think SaaS is going to be dead is because there's just a lot of opportunity like that. And also this whole idea, like I have to look into this more but Elon Musk and saying I'm going to, that we're, you know, agents are going to just replace all SaaS companies or something. I'm not sure if I fully buy that because it doesn't make a lot of sense to have, you know, let's say there's 50,000 companies in an industry. Are they all going to have their own custom software? So how does a person move in that industry and know how to run a company? Because if it's done completely differently in each company, the industry itself is damaged by that. Do you see what I'm saying?
00:54:39 - B
100%.
00:54:40 - C
Yeah. And so that, I think there's still a lot to go on here. So what I want to say to our viewers and listeners though, if, by the way, come talk to Tyler and I if you find a very important process done in Excel because we want to know about it, that's for sure.
00:54:53 - A
I can tell. I always opened up a can of worms with this question because I, I do agree that there is a, still a lot of spreadsheet conversions that you can, you know, pivot over into a SaaS and great business models and great startups can be created from that.
00:55:07 - C
One of our favorite newest investments is doing just this in one of the largest industries in the world.
00:55:14 - A
Yes.
00:55:15 - B
And to your point, John, we fully expected to start Spiff and start with very early stage companies again. And you know, where they hadn't like, because we figured like, well, once you're mature you've got to have a. And we were shocked by the scale of companies where they're, they were doing.
00:55:35 - C
That same thing and it's, and it, it is fascinating.
00:55:39 - A
Well, what would you see? Tell me one story of like a company that was mature, big, a lot of employees, huge sales force and you're just like, you're doing it that way. Like what, What's a crazy story?
00:55:55 - B
Well, I mean, I guess what, this is probably not as good as my 16. No, you're good. You know, I was just curious. But what I would say is one thing that we were shocked by, we went into a space where There are competitors. SAP had acquired a company like five years before we started NetSuite.
00:56:15 - B
Do any of this Oracle NetSuite has a company. Yeah.
00:56:19 - A
That does commission calculation.
00:56:22 - B
It does, that does commission calculations. There's a few that have, like there's one in the space that's gone public and then been taken private.
00:56:30 - C
And there's software even for a homegrown industry here in Utah, which is the MLM industry. Yeah.
00:56:35 - B
So the network there.
00:56:37 - C
Right. They have to do their distribution commissions like crazy.
00:56:40 - B
Insurance also has some specialty software type of.
00:56:44 - C
So you're saying big companies must have this figured out.
00:56:46 - B
They must have it figured out. We were shocked and pleased at the number of situations we ran into where it was a public company who'd gone to one of these competitors that were 500 million in revenue or whatever and gone back to Excel. And we were once again, we were.
00:57:01 - C
So against their software purchase. Became a white elephant. By the way. I have history on that. I can't.
00:57:07 - C
But I, you know, one of my companies that went public in the dot com era, we were there and we bought PeopleSoft for $400,000. This is via CRM. This is before the Salesforce. Right. And that would.
00:57:19 - C
They were the SAP. PeopleSoft member. We bought. We literally paid. This was a lot back then.
00:57:24 - C
Think about $400,000 for a piece of software that we had to load up on our own servers. Wasn't cloud, it was in, you know, and $400,000 and we had tons of salespeople. Nobody ever used it.
00:57:35 - A
Yeah.
00:57:37 - C
400,000.
00:57:37 - A
Yeah. So if you find, if, if the entrepreneurs out there find a situation like that where a large company or you in your daily job or in your daily workflows, you have been tasked with using a software and you don't like using it, you don't want to use it, and you go back to Excel. That's an awesome opportunity. Yes.
00:57:54 - C
Come talk to Tyler.
00:57:55 - A
Yeah, come talk to me.
00:57:56 - B
My experience is especially with these kind of boring business software because like commission, I love commissions.
00:58:03 - C
Yes.
00:58:05 - B
It's easy to classify this as boring financial software type of thing. My experience in these industries is that whatever exists ages and about every 10 to 15 years, there's room for a new startup.
00:58:20 - C
Yep.
00:58:22 - A
And that's just the innovation of these larger mature companies. They bloat themselves so big that their managers and the decision makers get so far away from the customer that they don't know what the customer wants anymore or what the user usage should look like or what the experience should be. And so they go.
00:58:40 - C
It even can come down to, let's take a vertical where 15% are using a piece of software and 65% are using Excel. Okay. And then another 10 to 15% are using paper and pencil. Literally that still exists today, all over the place. And there's ripe for opportunity.
00:59:01 - C
And imagine right now with Vibe coding and AI, how you can quickly validate there's a business. So you do lean startup to validate it. You validate the problem, then hypothesize a business model and validate it, and how quickly you can build a product and get in there and take those paper and pencil people and Excel people to your product. You don't even have to go try to win away the top 15% using an existing software. You'll eventually get there, maybe.
00:59:27 - C
But there's so much conversion from paper and pencil. Excel. Is that doing what you're. You spent a lot of time doing paper, pencil, and Excel conversions.
00:59:33 - B
Yep, a lot of time on those conversions. Most of our closes were some version of that conversion.
00:59:39 - C
Yeah.
00:59:39 - B
And I will say for the entrepreneurs that are out here right now, I'll admit that, like I mentioned that we would have loved to take Spiff public, and we're making good progress towards that type of environment where we could. One of the things that made us nervous was a realization that as fast as AI was progressing, we got Spiff to the exit that we got it to in the situation we did, we raised $118 million, and we had a team of, at its biggest, maybe 320 people, and we weren't sure. We. We thought it fairly possible for a company to raise 10 million and a team of 30 with AI's help, to disintermediate you to do everything we had done to get to that.
01:00:33 - C
Yeah. So can I ask you something you said? Because I think it'd be a good question for our viewers and listeners to hear why you said we would have loved to go in public. Explain that statement.
01:00:46 - B
I mean, I know there's so many headaches there and, you know, the extra, like, logistical and the problems there. I think we saw something that we did think could be a stable business on its own. And I just seen capshare be mothballed, to use your term, a little bit earlier. And so we were very interested in finding a place where Spiff could exist more permanently. And one of the things that was attractive to us with Salesforce is they still use Spiff, the brand name and Spiff product.
01:01:30 - C
And so that's that. But you were kind of saying, we would have loved to gone public, but you're saying your private sale was still very attractive.
01:01:36 - B
Very, very attractive. It was.
01:01:38 - C
Financially, everything.
01:01:39 - B
And we found a Home where we feel like Spiff can last for a long time.
01:01:43 - C
But. But one, one thing that is true, all other things, but being equal, when you go public, my life history is about this. You will, the valuations will be about two and a half times higher eventually that you get liquid on your shares as a founder. So in other words, if I sell privately, I still get a good value, but if I could go public and wait a few years and have it become a successful public company, my shares would go higher and I could get liquid. You're forced to not sell them for 18 months.
01:02:10 - C
And when you go public, public, or excuse me, six months, 180 days. And so it's just interesting. But at the same time, going public has its own headaches.
01:02:20 - A
Yeah.
01:02:21 - C
And by the way, we have a history here in the last decade of these SPAC companies. Right. Where you go back public backwards in a reverse merger and with the SPAC or a special purpose acquisition corporation or company that if you go look at the track record here in Utah, several companies in the 2021ish era when things were zany, went public through SPACs. And you can go look at their stock records and it's not a pretty picture.
01:02:50 - B
Yeah. I also think in general, I mean, valuation is ultimately a price at which a willing seller and a willing buyer can agree. And there's a lot you can do to influence influence. And that's probably, you know, a whole separate conversation. But there's either going public or in a private acquisition, you can get a great valuation and you can you find something that works and a burden.
01:03:15 - C
Handsworth two in the bush.
01:03:16 - A
Yeah. So I mean, you've gone through two acquisitions now. Obviously Spiff was much larger than Cap share, but do you think your confidence of going through that first acquisition kind of gave you and Jaron the ability to capture that much larger of an exit the second time around? You're like, look, we've been in this industry, we know this spreadsheet conversion thesis that we did with capture. We're going to do the same thing with commissions. We've talked to these customers.
01:03:45 - A
We've been through an acquisition. We know what it takes. We know the revenues we need to achieve was that was it like. I felt like it was like almost cut in stone that the future of.
01:03:55 - C
Spiff, you know, the principle leverage there is huge. Yeah.
01:03:58 - B
I mean, we mean, made so many mistakes on Cap, of course.
01:04:01 - A
Yeah, yeah, yeah.
01:04:01 - B
And we made so many mistakes on Spiff too. Like you don't.
01:04:05 - C
But I bet, but I bet you A lot of learnings from Cap Share from those mistakes you repeat. And Spiff got bigger. So you were in new territory, so you made more new mistakes. But as far as getting Spiff to where capture was when you sold it, I bet you avoided a lot of mistakes.
01:04:20 - B
Yeah, we could avoid like six months at a time, hop forward by just like knowing where to step in some of these things.
01:04:28 - C
Here's this landmine. Let's go this way. Yeah. Yeah.
01:04:31 - A
One thing I did want to bring up too, that you brought up at the beginning of the podcast was about how Salesforce invested in you before they acquired you. You know, that's, that's unique and I think it actually happens a lot more than a lot of entrepreneurs understand that a lot of these companies have these venture arms that they're investing in acquirable or like minded products or ancillary products to their main product. Was that Salesforce's goal from the whole time?
01:04:58 - C
And let's make this your last question because we are getting a little bit low on time and then. Because we want to ask them our golden question at the end.
01:05:04 - A
Right?
01:05:05 - C
Yeah.
01:05:06 - B
Yeah. So they, I mean, I would say someone like Salesforce Force, incredibly smart company. Obviously they're putting down a lot of bets earlier on, some of which are going to pay off, some aren't. But building that relationship for them is valuable as well. And so understanding that and figuring out like can I set up a situation that I can make this a good bet is always smart if you're.
01:05:43 - B
We only had one corporate venture partner in Spiff at Salesforce.
01:05:49 - C
Right.
01:05:50 - B
And I usually advise against that. Meaning that you don't want to get in a situation where a Salesforce has put feelers in you and made it very costly for SAP to buy you.
01:06:03 - A
Yeah.
01:06:04 - B
Or someone, you know, any variety.
01:06:06 - A
You mean their print was just all over you.
01:06:09 - B
Yeah. Well, and they, they'll put language in first right refusal around for things like first right of refusal and for information rights. That can be costly in a situation where we easily could have competed with Salesforce. You know, like we, we needed a situation where we could argue on price when it came to that acquisition. And if we argued too much and they went out and acquired another company, then all of a sudden we've got this investor with, you know, so we didn't give them board observer rights.
01:06:43 - B
So we invited them. They were at every board meeting, but they didn't have the formal rights. And so there's things like that that I do think that you want to be careful about.
01:06:51 - C
Yeah.
01:06:52 - B
To Be aware of the fact that like, yeah, they will use this information.
01:06:58 - C
Be careful who you invite, your messages. Be careful who you invite inside your tent. Yeah, yeah. And that can have a consequence in this case, it was a good consequence for you, but it could have been not been that way.
01:07:10 - B
And they were awesome.
01:07:11 - C
Yeah, yeah, it's cool.
01:07:13 - A
So, yeah. Okay, we're going to wrap up the podcast. Thank you, Matt, for coming on.
01:07:18 - C
Incredible discussion and you're always, you know, fun to discuss these things with this.
01:07:22 - A
But before we close, we always like to ask our guests, you know, having this track record, having this experience now, all of us now, knowing your story and your history, what's the tip? Like, what is the one thing you can shake this all down to? That's like, if I can tell and look these entrepreneurs square in the eyes, this is what needs to happen. This is what you need to do. What would it be?
01:07:48 - B
Here's something that I've given before, but I'll, I'll give it here because I do feel it like pretty passionately. Yeah. So when I sold, I was looking back a year after we sold Cap share when I'd kind of moved on to Spiff and I had, I had my to do list app and I had a handful of to do lists in there that were cat in a cap share, like bucket. So they're my cap share to do list. And I went through and I had, I don't know, 5,000, 7,000 to do's from the course of like when I was at Capshare.
01:08:27 - B
And they're, they're random things. Talk to Tim, you know, 10 talk about. But I kind of spent some time scrolling through my TO dos and kind of looking at them before I deleted that out and you know, because I was doing other things. And what I found was that of those to do's, it's probably about 2% of them that really mattered. And the 2% kind of had a common theme of like one of two things.
01:09:02 - B
They were either painful things I didn't want to do, or they involved really digging in and caring about a person, someone on the team. You know, it's like it's a hard interpersonal conversation or, you know, either helping someone further along things or having a hard, like let a person go type conversation or something like that. But the 2% was always hard. But they, there's situations where you, when you look at those, I probably was more productive in the, like, what we accomplished as a business. I was probably more productive in one hour hour when I got that to do done than the rest of the week.
01:09:54 - C
Yeah. So there's a bumper sticker, I can do hard things. So bottom line is you're saying the hard things that are sometimes uncomfortable are the ones that were the most productive.
01:10:04 - B
Yep. Identify those things that are the productive that are going to be kind of 20x.
01:10:09 - A
Which literally shakes back to how we began this podcast of you telling us that you forced yourself into sales that led to a very fruitful career for you. Yes.
01:10:20 - C
Imagine if you had kept your nose up and said, I walked away sales. Where would you be now? Where would you be now?
01:10:26 - A
Think if you did not take that job and you walked away from that analytics company and never took that sales opportunity. That's crazy to think about.
01:10:34 - C
Yeah.
01:10:34 - A
Well, Matt, thank you so much for joining us. This has been an awesome episode. I think we knew each other at. By. By you, but I don't know.
01:10:42 - A
So our. Our paths may have crossed more time.
01:10:46 - C
You could have been sitting in the same class.
01:10:47 - A
No, legitimately, probably. But thank you, Matt for coming on. Your story is incredible. Like a lot of lessons learned here. So, like, Share, Subscribe Follow Us Hit Matt up.
01:10:59 - A
Sounds like he's got 80% of free time on his hands right now. I'm not gonna overstate Matt and his availability, but we're gonna hit him up. But he's really nice guy and he's a. He's a great. He's a great mentor and knowledgeable in a lot of different facets.
01:11:14 - A
But thank you so much, man.
01:11:15 - B
Thanks, guys.
01:11:15 - A
Seriously.
01:11:16 - C
Thank you.
01:11:16 - A
We are going to wrap this episode of the Startup Ignition podcast and we are out.
01:11:32 - B
Bike.