Video, podcasts, blogs, sites, digital marketing: the media landscape is changing and new business models are emerging. This episode explores the shifting world of media with entrepreneur and investor Jason Calacanis.
Investing, Startups, and Media with Jason Calacanis, Investor and Entrepreneur
Serial Entrepreneur and Angel Investor
Video, podcasts, blogs, sites, digital marketing: the media landscape is changing and new business models are emerging. This episode explores the shifting world of media with entrepreneur and investor Jason Calacanis.
Jason Calacanis is the founder and CEO of Inside.com, a real-time mobile news app with the mission of being the world’s best news product.
Calacanis is a serial entrepreneur and angel investor in over 70 startups, including the first round of Uber. He is currently investing $15 million a year in 30 promising startups through the LAUNCH Fund and his AngelList Syndicate, which has 400 members.
After three years of hosting TechCrunch50, he founded LAUNCH Media, which publishes the LAUNCH Ticker and produces a number of events, including the annual LAUNCH Festival, the largest startup conference in the world with over 9,000 attendees last year. The Festival features 50+ startups that launch in front of 5,000+ industry leaders. Previous graduates include Mint, Dropbox, Yammer, Fitbit and Room 77.
Since 2009, Calacanis has been the host of popular podcast "This Week in Startups,” the largest talk show about technology and startups in the world. Past guests on the show includes Mark Cuban, Twitter founder Evan Williams, Paul Graham of Y Combinator and angel investor Chris Sacca.
Prior to that he was the CEO of Weblogs, Inc., a network of widely read blogs including Engadget, Joystiq and Autoblog. Founded in January 2004, Weblogs, Inc. became a wholly owned subsidiary of AOL in November of 2005. Calacanis maintained editorial supervision over Weblogs, Inc. as a senior vice president of AOL.
Before forming Weblogs, Inc., Calacanis was CEO and founder Silicon Alley Reporter, a must-read monthly that chronicled New York’s Internet and new media industries, that was eventually sold to Dow Jones.
Calacanis is known for his insights into the media and tech industries, and he is often quoted in trade and consumer media outlets. He also keynotes industry conferences worldwide.
(00:07) Welcome to episode number 162 of CXOTalk. I’m Michael Krigsman and before we start I just have to give a shout out to Livestream, who is our video streaming partner because they are great and they are enterprise ready and stable, which is what we need at CXOTalk and Livestream you guys are great partners and I just want to thank you.
(00:39) We’re here today talking with somebody who is one of the top angel investors in the world. And at the same time is truly a pioneer in new media, Jason Calacanis. Jason, how are you today.
(00:57) I’m very good. I am super super excited to be here and I am 12 days away from my wife’s due date for twins. So if I get a phone call during this I might be leaving because she’s going into labor. Who knows, anything can happen.
(01:15) Well thanks, hey thank you for taking the time to do this, especially under those circumstances. Jason, very briefly tell us about you background, just very quickly set some context.
(01:28) Well I’m a kid from Brooklynn who grew up in the right time in history I guess in terms of opportunity because you know 1977/78 somewhere in that timeframe I started using a computer, TSRS80 I think when I was out in New Jersey at my cousins house we would go to computer camp. Boy, was that a revelation to me when we were programming basic. And then I got my own PCM Junior and having a 2600, so I was kind of born at the beginning of this personal computer era and was fascinated by was able to get high paying jobs, my whole career as a database programmer, developer doing PC maintenance.
(02:08) Somebody just found, my brother actually found my first business card from my first real full-time job which was working for Amnesty International, and it said on the card, ‘Microcomputer Specialist’, and I was so proud of that card because I was a specialist of something in my life.
(02:26) But I quickly realised that I didn’t want to work for anybody and I started doing more and more entrepreneurial projects let’s call them, and once I had that entrepreneurial bug I had started a magazine called Cyber Surfer with a publisher that ended badly. I did five issues of that. Then I started Silicon Valley Reporter which became my first big claim to fame. I grew that to a $12 million a year business off my credit cards and it was quite a run. You know I think maybe 75 – 100 employees at the peak and I was a 26, 27, 28 year old with you know, whatever, almost 100 people working for me and sitting around a table with 25 journalists.
(03:09) So it was pretty heavy stuff and then of course the market crashed and I sold that company to Dow Jones and got a couple of years salary. Started Weblogs Inc, which was a blogging company when there were really only two or three other blogs out there. Dave Weiner had a blog and Gawker was out Gizmodo had just launched and then I started Engadget and Autoblog and Joystiq and a few other blogs, 18 months after Mark Cuban and me started that company. I sold it for $30 million to AOL and then I worked at Sequoia as an entrepreneur in residence. Did another company called Mahollow which is now Inside and still chugging along.
(03:47) And along the way about five or six years ago my friends at Sequoia said, Jason do you ever think about doing angel investing, you know a lot of people and you forward this to a bunch of your friends to look at their companies, what do you think? And I said okay, I’ll try it, so you know my first five investments were things like, Thumbtack, Uber, Chartbeat, and Signpost. So I had quite a good company and a really good network and since that time I’ve done 150 companies in just under six years. I’m on pace to do about 40 investments a year. And I’m definitely the most prolific arguably you know depending on who you ask the number one, two, three, four, five most desired angel investors in the world which is kind of how I define success as an angel investor, which is how much do the founders want you in their company. And you know when Ycombinator bans you, you know you’re doing something right.
(04:48) Right so on these angel investments that you’re doing is there a particular common theme?
(04:56) Yes I pick entrepreneurs who are extremely driven, resilient and who want to win. Then I picked entrepreneurs who are executing at a very high level, and then I pick entrepreneurs who fit those two categories who are operating, hopefully in a space that I see becoming a billion-dollar market capped company. If I can’t figure out how to get to a billion-dollar market capped company, then those other two factors are very strong the resiliency and drive of the founder, and the founders ability to execute I might still invest. But if those first two are off I will not invest.
(05:37) So there’s no particular subject domain or topic domain so to speak that you’re investing in?
(05:46) No that’s stupid to do I think, these are my things and I think that’s kind of stupid although the respect to people who do this and people who build entire funds or it might be because they love working on those projects or they intellectually curious about it. I don’t think it’s a very good thesis for returns, because it presupposes that you are some genius with Nostradamus like effects, and I haven’t met the person who has that. That’s coming from the person who is in the top 10 Angels investors of all time right now.
(06:19) So you know, I’ve watched the other angel investors who have done an amazing job, a better job than me. Ron Conway, Chris Sacca, they’ve had much more success than I have, and Mark Andreessen even when he was an angel investor he did pretty well to. Kevin Rose did fabulous, and I think all those people have much better track records than I do although none of them are angel investing any more. But those four I don’t think they were sector specific either. So you know, people look at the statistics, this idea like the Google glass fund, which you know Mark Andreessen funded into the Google glass fund, now there’s a Slack fund. Their previously has been you know…
(07:00) Well there serving a particular interest in those cases, a particular master.
(07:06) Yes, it’s a huge mistake I mean it’s not mistake for the companies Slack or Google it’s probably a great idea to put $100 million into funds to build up their core business. It’s a mistake for everybody else – it’s a mistake for fund managers I think to be sector specific.
(07:24) You can have preferences because I’ve a Ph.D. in biology and you know what ever sure, put this on biology I understand that, but I think on the angel investing front, if you’re looking for the big binary outcomes I would have never been a marketplace investor or taxicab investor. My two top investments are a transportation company and a marketplace company. I didn’t ever think I was going to be in those businesses right, but now I think my biggest company after Uber or Thumbtack probably would have been Café ex, which is about coffee machines, so I never thought I would be in the coffee business either but here we are, right.
(08:02) I try to reserve judgement, and what I learned long ago is that I’m not the smartest kid in the class, they told me that explicitly that actually, ‘You are not the smartest kid in the class’. So then I said hey, if I’m not the smartest kid in the class I can be the hardest working, and I can be the most connected. I can be the most risk taking, and so the smart kids are sitting on the bench and I’m more aggressive and risk-taking than they are.
(08:24) What about media, you have this week in start-up and you’ve hit over 600 episodes, so tell is about…
(08:34) It’s a hobby.
(08:35) So it’s a hobby, so you’re doing this thing as a hobby and you’ve got 600 episodes under your belt, tell us about that and tell us about what’s going on in media, because you’ve got a unique position, a unique seat as a media observe.
(08:49) Yeah, it’s the number one start-up podcast I think in the world – well actually no, there is another group that makes podcasts called start-up and it’s about their start-up, MPR guys, and I think they have much more traffic than I do.
(08:59) But I think in terms of like a serious start-up, and you know it not like an entertainment show, we are the beginning and the end we have close to $1 million in revenue or so on the podcast and then we’ve got an Emmy Award winning producer you know, a bunch of people who work on it. So I love doing it, but I actually do it to feed my own intellectual curiosity, because I like having conversations with intelligent people. And after I get out of it those conversations I feel more inspired and I have more energy.
(09:33) So, I’m a high extrovert and one of the definitions of an introvert versus an extrovert is where they get their energy from. I learned a long time ago that if I have a great conversation you know at noon you know, for the next 24 hours my energy is really high, and my creativity is very high and I really enthused.
(09:51) So my podcast is almost in a way like my energy. I just ask my producers to get me highly intelligent people that I can talk to. I could do it all day long. I could interview three people a day, every day, for 365 days a year and that would not feel like work to me.
(10:10) Yet I mean I interview people like you, people shaping the world, and it’s so much fun. But you have $1 million in revenue, what is the business model then.
(10:23) We read two ads a day, about two ads per episode and we limit the advertisers to people who have products that I actually use or one of my companies uses. So we don’t get any shitty advertisers or advertisers we don’t believe in. I use GoToMeeting, I use Squarespace. We use PagerDuty, we use Chartbeat or actually not Chartbeat now.
(10:49) When we had MailChimp as an advertiser we used MailChimp. I still use MailChimp. Audible I love. Audible knows I love them because I tweet about what books I like and make them as an advertiser. Then they went away for two years, then they came back. You know like there’s different companies I love and their products will just float in and out and support the podcast. We typically sell out the ads three, four, five months in advance, and you know it’s a nice little business that I enjoy doing.
(11:17) I don’t know I think I’ll maybe get to 1000 episodes and maybe I’ll pack it in; I don’t know. I said that when we were getting close to 500 and when I was at 400 I said hmm, so maybe I’ll stop doing this at some point.
(11:28) But we’ll see. I’ve got a lot of offers to do stuff on real television now and you know real radio ad so I consider some of those opportunities. I’d like to expand you know, a little bit beyond technology and maybe talk about somethings just a little bit outside of that, because I talk about entrepreneurship and technology and you know that bleeds into a lot of other areas. But you know part of me in another life would like to just host a drive time radio show for three hours a day. I kind of love doing that.
(12:02) Yeah you like to chitchat, that’s not quite the right term. How do you build the audience, because I think that’s the real question that everybody has, so how do you build the audience?
(12:14) That might be the question you have to be honest.
(12:17) It’s definitely the question that I have but I think we’re…
(12:21) The quality of the guests. Yes, that’s it, it begins and ends with the quality of the guests. You get a great guest, you get a great conversation, and the things going to grow. You know, the thing is they just show up you know like people do like five episodes and it’s there, them and their friends talking and it’s incredible boring and none of them have any type of demonstrable success or charisma or they’re entertaining. But they just do a bad impersonation of some other podcast or other personalities. But what they don’t realise is you know, it’s not about you particularly, it’s you know the best podcasts are about the guests. You know like Kevin Pollak or Marc Maron or Adam Corolla you know some of those people are actors and comedians outside of it, but in those three cases they all happen to be exceptionally good at interviewing and having conversations.
(13:12) So I think if you look at Bill Simmons, you know he’s just a really good ring leader or Leo Laporte. So I think there’s different categories. There’s people like the ring leaders, like Leo Laporte and Bill Simmons, they can sort of organize a group of talented people around a topic. And then you have people who are solo artists, but who are great interviews. You know there’s all different types of people out there who have different skillsets. And you have to figure out which one is yours, and for me, I’m always trying to increase the quality of the guest. I know I’m a great interviewer but you know I don’t know if I would be a great solo podcaster like just me talking and not being able to give a shit.
(13:48) Yeah I know, it definitely helps. You need to have something to bounce off on. So a lot of it is being relentless.
(14:00) Yeah, showing up is probably 90% of it and you could probably say relentless is a way of saying showing up. But I do have to say you know, showing up and it being bad forever is not good either. But if you show up you should listen to what you’ve done, or take notes, or listen to the audience and just try to make a little better each time. I mean after 600 episodes, if I just made it 1% better each time that means it’s going to be well more than 6X because you’ve a compounding affect- 10X or whatever. So I should be theoretically about 1% every episode, you know 10 times better or whatever it is so you can do the math.
(14:44) But you know I don’t think a lot of people are super considered, nor do I think people are relentless. So you know, I think it takes a certain type of person because you know, it’s going to suffer for the first two or three years in terms of revenue or audience. So I think the people who succeed are the people who make it to year three or four. I think years one or two you’re just getting your legs under. Unless of course sure, Adam Corolla did a radio show or your Joe Logan and but even Joe Logan is at 700 episodes. I think he does it every day, so he’s just ploughing through episodes and he’s pretty dynamic in terms of an individual. So you know there are exceptions to it but generally speaking there’s no exceptions; that hard work pays off.
(15:29) You and I met at Jason Lemkin’s Saastr conference a few weeks ago.
(15:37) At the opening night party.
(15:39) That’s right, at the opening night party and I told you how many episodes we had done and you nailed it, so for us it’s about three years now. But as far as measurement…
(15:51) And you’ve got a good cameras.
(15:52) Oh we’ve got a great camera.
(15:55) I googled it. it’s gorgeous.
(15:59) There aren’t many people who are using this type of camera as a web cam, and it took a lot of work to figure it out, but you know figure it out. So, as far as metrics go, everybody is hung up on page views, and there’s problems with page views in general, but with video it doesn’t consider engagement at all, nor does it consider the quality of the audience. So how would do you think about metrics, page views and evaluating success.
(16:33) I don’t frankly. I mean everything for me begins and ends with just having a great conversation. You know, there are all kinds of little tips and tricks and things you can do. I suppose having good cover art is good. Apple featuring you is good. Having an email list is great, so even just basic stuff like that, which I guess just like blocking and tackling. But again, if you get a great guest and you know everything sort of flows from there and if you get the best out of that great guest.
(17:08) So if you look at somebody like Chris Sacca, a lot of people had them as guests, but nobody got out of them of what I got out of those individuals in conversation because they feel comfortable with me, and that’s my greatest advantage is that as an interviewer the people that I’m interviewing, if a journalist was interviewing them they would look at it as a journalist, which means it’s going to be pretty antagonistic by definition.
(17:30) If they look at it from me they go, oh this is a guy who I can do deals with, or this is the person I play poker with, or this is the person who I went on vacation with. Or this is the person who I had dinner with, or this is the person where we had a play date with our kids. So I’m got this incredible you know massive unfair advantage versus journalists who when they come in, they don’t even know who the person is.
(17:52) And so I’m not trying to catch anybody or do a ‘gotcha’ type of journalism, we just having a real conversation. I sometimes have a real conversation with somebody, and somebody will go there, and I’ll be like ‘whoa did they mean to go there or not, like the last Chammat episode he just went diversity, diversity and I asked him about diversity because he had put it out there by writing his blog post and his study about the information about it. So I sort of just put it out on a plate and said hey, tell me about your diversity effort. I didn’t ask him some you know, really you know challenging, Mike Wallace you know, hard-hitting 60 minutes confrontational question. But I don’t need to because you know if the person trust me, and if the person feels comfortable with me I can start on second or third base in terms of guessing that home run answer
(18:41) So the key to your interviewing then is creating an intimacy that’s based on trust, shared background, they trust you basically.
(18:56) Well yeah, I’m friends with a lot of the people on the show and a lot of people who have listened to the show for years or they’ve known me for 20 years as a journalist, as an angle investor, or entrepreneur. So I do think you accrue a certain amount of you know respect or people in some cases have reference for you. people like Ryan come onto the show and he’s like ‘I listened to this during college, like I called into this show’, or you know one of the founders of digital ocean is like ‘I’m at DigitalOcean because you told me to quit my job and go and join DigitalOcean. I was on an Ask Jason segment’. I was like ‘You were I don’t remember- oh yeah I do remember that’.
(19:31) So this you know when you’ve stuck around for long enough and I think if you listen to Howard Stern in this last five or six years, he’s become this incredible interviewer and I would argue that he’s always been a really good interviewer.
(19:45) Over the last five or six years, people coming into it, you know this guy’s retiring, this guy’s made me laugh for 20 years, 30 years. This guy’s had great conversations with other people; I think people are now going in who have just had Sally Field on. And you know I don’t know if Sally Field would have ever been on the show 10, 20, 30 years ago but the day after she hears Gwen Stefani – I’m sorry, Gwyneth Paltrow which was another incredible interview or Madonna or other people come on and have a great interview, I think it kind of somebody send that tapes and says listen to these three interviews. And they get inspired, they trust the person, have reverence for them, respect for them or whatever it is.
(20:19) I think I’m sort of just starting to tip into that in my career which is ‘oh yeah this guys- I’ve laughed at his show before. I’ve got information out of his show before. I can’t wait to be on the show’. I have many people that after they walk out of the show they’re like, ‘ This show inspired me to be an entrepreneur’, or you know, ‘this interview with this entrepreneur inspired me’. So the person you had on as a guest inspired me to be an entrepreneur. So the power of podcasting is not to be underestimated.
(20:47) So you’ve got this week in start-ups and then convert to a podcast. Are their business models for podcasters these days?
(21:03) …is the obvious one and donations work pretty well to, so if you look at Tech News Today, the guy who previously worked with Leo who did his tech show, Tom Merritt, he left and did his own show and he might do 10, or 20K a month in reoccurring donations. He’s up to 20K a month, up to $240,000 a year, he does it out of his house. They’re doing it on Google hangouts and you know, close to zero cost or very minimal cost for a producer and some bandwidth or whatever 100k a year or 200 K a year.
(21:37) So, I think there are models out there between asking your audience to pay and asking sponsors to pay. But I don’t think it’s a place to go to if you’re rich at all. And there is also speaking gigs. I was talking to somebody you know who has a podcast – I won’t say the name but who told me – yeah I just got my first 10/20K speaking gigs, and I’m getting those every month. So it’s like okay, your podcast made zero but you got two speaking gigs a month and it’s 30k a month from speaking gigs, holy shit, what a life you have now.
(22:06) So I mean if I wasn’t doing everything else I was doing right now I could literally just do speaking gigs for 20 grand or something like 10 grand, I don’t know what people are paying me now, I could just do the speaking circuit probably like Seth Godin does or other people and paying the mortgage that way. So there’s plenty of opportunities but I don’t think it’s a great business to get into as a business.
(22:27) I was talking with the editor and chief recently of a major news site, and his observations is media these days is kind of a cottage business, so it’s sort of mirroring…
(22:40) There is a lot of cottages.
(22:41) There is a lot of cottages but there aren’t many to many big houses, I mean it’s almost impossible to build a huge major media company.
(22:48) Yeah, I have to think about that, so yeah, I mean who cares about building a major media company. If you’re Howard Stern and you can go from 30 million listeners at his peak and go down to two or three million now or five million whenever he gets you know well, he’s making more money of 10% out the audience because the audience is paying you know 10-15 bucks a month.
(23:12) If you look at someone like Leo Laporte, yeah sure he can get a million dollar contract with somebody or he can make I don’t know, a million dollars or two million dollars in profit a year doing his own network.
(23:24) So Adam Corolla was on regular radio now, he makes $5 million a year doing whatever he does, so you know it’s all tradeoffs. But I think it’s really about the big media companies because you know they can’t control the best talent anymore; the talent can go direct to the audience. And so everybody who wants to create a podcasting network, like I tried to do it and I had the same experience with every talented person which was they would go in and out in wanting to do a podcast or not because they don’t need to, and they don’t need anybody, so they can rent my ads but I don’t need to be part of an network. I don’t need to get a pay check from you so I’m not doing it for the pay check.
(24:01) So I think there are some complications to making it a big scalable you know there’s a Podcast One Network, there’s you know people are making their own little networks like Leo Laporte did and like I did and other people did. And it’s you know I think it’s very hard to get that second, third, fourth, fifth hit podcast that you want because you don’t have the talent. I mean anybody can just leave and there’s been Tom Merritt having a year or two with Leo and now he’s on his own. That’s no fault to Leo it’s just the nature of the business that somebody can just walk out the door, start their podcast the next day, and set up a patron page and technology allows them to go and do it themselves.
(24:40) What about education, so you’re talking about podcasts where the personality of the interview is so strong that really carries it. But what about distributed education and approaching it that way, and looking at it as an educational vehicle rather than…
(25:01) Yeah, listen people get an education from it for sure. I think in that way you know Audible has been doing better and better. Podcasting does better, audible does better, Audible does better podcasting gets better where I think people are looking at the spoken word you know just the device changes everything because I have a computer in my pocket with broadband essentially. So unlimited storage essentially, so I don’t know how many podcasts you can put on one of these things, but more than you can listen to in a year.
(25:27) So yeah, the software’s sophisticated, the amount of content out there is unbelievable. The quality of it is variable, but at the top end it’s exceptional. So yeah, education is a great category.
(25:42) Again, there’s probably other tools that are better for education for directly teaching people other than podcasts, so of course what Sarah is doing with Nano courses Or Dailydrip is doing with daily education, or Lynda and Treehouse with continuing education, those things are better or Duolingo for do not learning a language. So they are going to be very specific vertical. They going to be vertical specific apps and platforms that will do better in education. But for generalized, keeping up with the news, keeping up with industry information, and learning just how the industry works there’s nothing better yeah.
(26:18) I mean if you can have a choice to go and get an MBA or take the ( Unclear 26:23) without the MBA and literally listen to three or four podcasts a day, and write a blog post about them, and pay your living expenses and do that for three years, I think you would learn more actually doing two years of listening to podcasts and writing up a blog post on them and writing your notes about them, and then doing your own each weekly podcast. Yes, for sure you can roll your own education, but you have to have discipline or it’s either you give another person a bunch of money and let them have the discipline.
(26:47) Jason, we have a question from Arsalan Khan, who’s asking what’s the best way to promote your material, but there is another way of asking it as well which is, with so much content that’s out there how do you break through the noise? And you’ve done an incredible job with that, so teach us, how do you break through the noise?
(27:10) That’s a good question, I think the quality and having the vertical that you’re good in is a good starting point. So if you start CXO podcast right, it’s a very general thing. But at least it’s about the senior executives at a company. Like doing a CFO podcast or the CTO podcast, or the Chief Strategy podcast would be a much better way to start than just doing that CXO – not that CXO’s a bad way to start. It’s obviously work for you to a certain extent so that’s awesome. But I would say go even more niche you know. I didn’t do this week in tech; Leo did I did this week in startups – a subsection of technology and the subsection I happen to be an expert on or most people consider me an expert on.
(27:52) So the key is to focus.
(27:56) Well I think if you created a sports podcast right now I don’t know if anybody gives a shit, but if you created what about rock climbing you might not have as much competition. I tell everyone we’re the number one startup podcast because there were no other podcasts about startups. It’s pretty true; when you don’t have competition is easy to be number one.
(28:16) Switching back to investing, you are seeing so many different companies, what’s interesting that is coming down the pike that you observe.
(28:27) Robotics, marketplaces, AI, machine learning, you know enterprise software there is always a place for people having the tools that makes them even more bionic. So I’m seeing a lot of tools that make individuals more effective and what they do because, let’s face it you know, the machines are going to start doing really interesting things that white collar people do right now. So you know first we had you know machines that just drove stuff instead of people carrying it. You know now we have machines that lift things, and people used to lift things. Now people are putting painting cars and putting the doors on, and putting the hoods on the cars. You know it’s only a matter of time before the cars you know start driving themselves. So you know just the idea of manual labor is going away, and the next piece that’s going away is the white collar work, and even some of the sophisticated white collar work is going away.
(29:25) So this idea you know that somebody will connect your phone call obviously receptionists went away. And now you have oh, you had an executive assistant who booked meetings, well now there is this like you know of virtual assistant that you can CC on your email, and he was she depending on how you…
(29:43) I just started using that.
(29:45) Yeah, it’s just you know basically it books the meeting for you and there is a little bit of human attraction on the backend right, but it just works. So you’re going to start seeing a lot more than that and that’s going to go faster than people think. So this making people bionic is something I’m getting as little bit interested in. so I think what will happen is just that my company LAUNCH, were doing the Launch Festival again and it April 19 were doing it. it’s bigger than ever that’s people working on it.
(30:12) So we reduced the number of the people who work on it. the people who work on it are getting better and better. So we use something called Zappier, Typeform, Stripe, Squarespace and Hipchat in combination with google docs to just solve so many problems.
(30:29) We had Typeform for registration and we were doing that reach out to upsell people different types of ticket and do sales automation. With ticket automation when tickets got bought it’s putting it into the Hipchat room that a ticket had been bought. Stripe was process, so we were creating like all these little scripts and if/then/else statements, it’s not quite programming but sort of scripting or you know, it’s going to turn out that we’re going to be able to say we’re having an event on this date and we just put it all on one list like all the things that have to be done and the Launch Angel Summit, which is our next event when we do the summer, it’s like we popped up the event in almost no time and the only piece that’s taken time is going to be – not even inviting people. The thing that will take time is getting a location. And after we have a location getting everything else inline is going to be easy. So I’m pretty excited about that.
(31:24) So you’re using all of these different apps as essentially your weaving them together in one chain in effect to replace having to buy some sort of large enterprise app.
(31:37) Yeah, I think it’s having a real people app really. It really was more like a manual process. So the sort of business process outsourcing is what’s to occur now; it’s business process scripting, where you script, this is what I want to occur in the business process and somebody applies for a ticket, it knows they’re an angel investor, you know alert somebody on our team and we check back to see they’re a member of our syndicate. You know we can do all this kind of interesting if/then/else kind of things. you know put them into the spreadsheet and have the third party printing company print them a badge, like all the stuff we used to take a lot of time to do is just getting easier and easier.
(32:19) And so the data is and if you are using Zapier to basically manage the flow.
(32:23) Yeah Zapier and If This Then That you know, both those programs worked really well and Typeform is just great sort of like Survey monkey but a little sexier, and Survey Monkey does good stuff too. You know you can just like weave all these products together as glue is built between them through APIs. So I think it’s going to be some big opportunities there but I do think that employment is going to be really interesting to see how we create new jobs and you know, if we can train people up fast enough because we have people out there who don’t even know how to use email properly, or don’t even know how to use you know, document management or spreadsheets. And they can’t spell and they don’t do gramma and they don’t know how to do formulas.
(33:05) And there’s the other group of people who know all that stuff and know they’re learning how to glue it all together. Like I frequently hear the people say, ‘Well I can hire somebody for that’, ‘I’ll just write a script to do it’. It’s like ‘Oh really!’
(33:18) So the $20 an hour jobs, the $30 an hour jobs are going away and now you have this $100,000 person or $75,000 person in an organization who does the work of five or six people. And that’s the efficiency they’re striving, the economy.
(33:33) Will it, you know, and we’re seeing more and more people join the permanent unemployed. So I think what you’ll have within society is there’ll be less and less people full-time employed, supporting more and more people who are not employed. I don’t know if that’s through government or through families or communities, but it’s definitely going to be a trend; somethings in the air.
(33:53) So the weaving together requires an understanding of a range of products that at out there in order to…
(34:05) And the ability to learn new products, so you have to know how to be able to use new products.
(34:10) So on your team, who do you have that is helping, in a way this is like the new enterprise architecture.
(34:19) Yeah, you just have to have bright people who are fearless, I mean I think they have to have high IQs, you know, they have to literally be smart. If they were going to play any chess they would be in the top 20% of chess players. You know, it could be that they apply themselves or it could be that they’ve applied themselves previously you know I don’t want to get into too much judgements lead into nature verses nurture. But essentially if you’re able to learn new software quickly, and you’re smart and hardworking, you can just start using these tools, and you also know to look for tools.
(34:48) So I have people who are just so – I see people in the world, I don’t have them work for me I hire them real quick for my teams and fit them out pretty quick. But you know, there are people like ‘I don’t know how to do that’, and it’s just like let me Google that for you you know. Ticket sales, you know we were using event bright competitors, so like we just found people that wrote a blog posts, like if you don’t want to pay the Eventbrite price where they charge 5% for ticket sales, you can literally set up a Typeform and put it in Stripe and build your own Eventbrite. Like it used to be just five, six, seven years ago Eventbrite was just incredibly revolutionary product, and we used it and I was like, what am I paying them for and it’s like, well because they do all the processing, but yeah Striped does that and we have a Stripe account. You go and plug your stripe account into the Typeform and ask for the first name and last name and these other five questions, and you’ve got something better that Eventbrite. So you know it’s pretty interesting times. You can basically roll your own stuff, and it’s more effective, more cheaper and better.
(35:51) Yes it is pretty amazing, so again the challenge in a sense is understanding the range of products, understanding the capabilities of the products because that’s the first stepped for being able to do what you were just describing.
(36:11) You know, I’m not sure exactly where this is going. One of the things I’ve learned as an angle investor I don’t actually have to know where the train is going or the rocket ships going. I just have to be able to identify this is a rocket ship, this is a train, get on it. right, so I know there’s a train and it’s going somewhere, and there’s a rocket ship and it’s going somewhere you can be on it. And to be on it you have to be on the captain’s table somehow.
(36:34) What’s the best way for people who want to be funded to approach you? How do you like to be approached?
(36:42) It’s not so much about how I like to be approached. I can tell you the most effective way to get to any investor, because I’m not like one of these guy’s whose like you know the queen of England, I literally have some VC friends who is like (Queen of England voice) ‘This is how you have to approach me. You have to ask…’ so like get over yourself!
(37:05)You know basically I could tell you the best hack is to have coffee with an entrepreneur, who’s in that person’s portfolio, have that entrepreneur fall in love with your business and have them introduce you.
(37:10) So if you want to get built early as an investor and somebody from one of the portfolio companies od DogVacay or Uber or anywhere in between like that’s the way he’s going to pay attention. If you want me and you talk to Tom at Thumbtack or talk to Tony at Chartbeat, or talk to Stuart at Signpost, any of those people you know and they refer you to me and say, ‘Hey Jason this looks really interesting for me’, that’s the best way.
(37:50) Cold emails we look at and if it’s an incredible product that has revenue traction and is really well put together sure. Then the worst things you can do is to say, ‘can I have coffee’ and write a long email, because like this is too long, so it’s kind of like, ‘Oh my god, what’s important in a 2000 word email; it’s very hard to determine, so I like short emails. ‘we are building a Slack competitor that is better because it’s open source, and we’re going to make money off hosting and we charge a flat rate of $500 a month and you can have as many people as you want. It’s very disruptive.’ That email to me would be like ‘okay’ and there’s a link and ‘you could see the product here. You can try the product here. We have 20 people who are using it’. Whatever.
(38:35) The way I just presented that like yeah, we’re a flat rate variation of Slack, it’s ‘Oh is that charge just $500 a month and you have unlimited? Okay, it sounds like a disruptive business model, great. Let’s talk.’ Right so you know people are just a little bit clueless. They want to hang out, they’ve got that backwards. They think that you’re associated with a great investor you’re going to be successful. What it is it’s the great investors are finding the great entrepreneurs and it makes them look successful.
(39:03) you know, I’m not – the fact that I’m an investor in Uber makes me seem I’m the most brilliant person on the planet. I can assure you I am not. I got lucky. Had a 15 year relationship with the founder of the company and we’re friends, and I got lucky. And if anybody want to ascribe anything that Uber has done to me, they’re idiots. Uber would have been as successful. I have absolutely no credit t take and you know, it pisses me off a little bit sometimes because I’ll see other investors in Uber or like Thumbtack and they all want to like take credit for it.
(39:38) The most you can take credit for I think as an investor is you know, being a good picker right, and then you can take a little bit of you know, you can give yourself a high-five or pat on the back, if you like. If the founders say you’ve been helpful when they need somebody to talk to or a connection. But the truth is because I’m an entrepreneur like they know. The truth is the entrepreneur has built these businesses.
(39:58) The investors? They may have guided them, they may have set up meetings, they may have helped with the hire, but they’re not in their everyday working 12 hours in the day like everybody else in the team. So you know, never get too high on your own supply. It’s ironic or actually I should say it’s paradoxical that the best investors in the world are always the most humble and are aware of this fact,. Like you would never see Bill Gurley you know and the benchmark team taking credit for you know there investment success. You would never see sequoia doing that. you would never see Social Capital doing that. we all know we pick great entrepreneurs, we support the hell out of them but they’re doing the heavy lifting.
(40:35) I had Lew Cirne, who is the CEO of New Relic on CXOTalk, and he made the comment that the best entrepreneurs are the ones who are most self-aware.
(40:50) Yeah, you do need to be a little bit self-aware, I mean I’ve seen people who are not self-aware to be successful to, they just being delusional and whatever. But yeah, I would say being self-aware is a gift, because you know your own psychology. You know what’s going on inside your head. You know why you’re doing stuff. You know your motivation. It takes a little while to get there typically for most entrepreneurs who start doing stuff when you’re young. But you know, when you’re older it’s pretty nice to be self-aware.
(41:20) It can also be a curse to be self-aware because you realise it’s all meaningless, and you’re going to die and what is the point of having the number-one enterprise software company. But be pretty careful because if you become super enlightened you just might realise that oh my God, I can just take whatever money I have right now and live on a beach and spend time with my kids, which is much more important and fun for me. You know, or I could just go and play cards for a living and laugh, sleep, and eat and not really have to have any of this stress.
(41:49) So we’re just about out of time, so why don’t you pitch are anything you want that you are working on.
(41:59) Well I would say check out the inside Daily Briefing. I’m particularly proud of that and LAUNCH Ticker. They are both the exact media product in two different verticals. Essentially I have writers who are really smart, who do the news all day and summarize it, and curate it and send it to. Inside Daily Briefing is 20,000 people, 50% of them open every email, and there’s three emails a day so we’re getting you know, probably I would say 75% of the list, 80% of the list opens either of the two emails I’ll send a day. And every week probably 80% of them open it.
(42:33) So it is incredibly timesaving. It’s time-consuming on our part to have a full-time and going through all this content and saying these are the best and debating or not whether putting them to work, and to determine what is the best based on people’s clicks and what you read in the newspapers. So Inside dot com, just go there and sign up, try it for 10 days, and then hit reply and it will go to the entire team and rate the email on a scale of 1 to 10. And people will do it. I ask people every 50 episodes or so, every three or four weeks like, ‘Hey rate the email 1 to 10, and tell us what you love and don’t’. People write back like, ‘This thing saves me so much time, incredible’.
(43:14) So I think it’s going to be a very big business; I have 20,000 doing the email now and I might be able to get it to a million. So if I get it to a million people a day who are getting it twice a day, that could be a huge business. Launch Ticker is $100 a year, $10 a month and it’s the same product, and about 11,000 emails people get it every day, and we’ve converted 1000 of them to paid. There is 9000 on a one year free trial or two month trial or whatever it is depending where we put them on the list. So, those are the two things that I think are super fascinating in my world.
(43:47) And your open rates are phenomenal. Unbelievable.
(43:51) Yeah, it’s like five, 10 times the industry average because we have a secret; if you send it twice a day and people don’t want to be unsubscribed, and then we put an unsubscribe link at the top sometimes and we’re like, ‘Hey if you don’t-‘ because people don’t page down to the bottom, so I’ll just say, ‘Hey if you are not enjoying this anymore, do me a favor and please unsubscribe’. And then people ask why are you asking, and it’s like well if you don’t want to be on with it I don’t want you to get it’, because I want them to be able to have a high open rate and have the high click rates because that you know really helps. Some people are like you know, I don’t click because you summarize the news so elegantly, and now I have got to figure out what the business model is here. So, that’s the next piece of the puzzle but just go Inside dot com, hit reply, try it. I get every reply and I replied to probably 9 out of 10, almost always I reply. Just give me critical feedback which we love and grated on a scale of 1 to 10.
(44:43) Great, well thank you so much, and also before we go I have to give a shout out to Marshall Kirkpatrick, who is the founder of Little Bird who is just a great social media platform, or influencer discoverer I should say, and Marshall’s the person who introduced us and we released the 20 influential CXOTalk guide to 20 influential Chief Digital Officers, and Chief Information Officers, and we use Little Bird so thank you to Marshall Kirkpatrick. And thank you to Jason Calacanis, who has been our guest today on episode number 162 of CXOTalk.com, Jason thank you so much for taking the time
(45:35) My pleasure, thanks for having me.
(45:38) And congratulations on your upcoming twins.
(45:44) Absolutely, it’s going to be amazing.
(45:46) Everybody thank you so much and we’ll see you next week, bye bye.
Companies mentioned in today’s show:
Amnesty International https://www.amnesty.org/en/
LAUNCH Ticker www.launchticker.com
Y Combinator https://news.ycombinator.com
Angel list https://angel.co/jason
Jason Calacanis website www.calacanis.com
This Week in Startup www.thisweekinstartups.com
Advertisement: Having an email list
Published Date: Mar 18, 2016
Author: Michael Krigsman
Episode ID: 323