Morgan Lynch

And this is a really important point I think for entrepreneurs too. If you go into a company and you treat it like your own, the executives and people that you're working with notice. And this is really important because that's where I got my funding. >> You're basically saying exactly what I like to say to people. You don't have a killer idea that really is validated as a great idea to just go launch, go into work for a 20-person startup emerging company is the perfect thing to do. >> Yeah. >> [music] [music] >> Welcome back to the Startup Ignition podcast. Thank you so much for watching the last episode. We've We are having so much fun doing these. We have amazing guests and we have another banger for you today. We have Morgan Lynch live in the studio. Thank you for coming, Morgan, and making time for this podcast. He called me yesterday. He's like, "It's not today, right? I can't make today." I'm like, "Morgan, it's tomorrow." He's like, "Perfect." >> And Morgan's one of the first entrepreneurs I met 24 years ago when I came from Seattle to Utah. >> Really? >> Yeah. We did. >> want to date you guys, but how long ago was [laughter] that? >> 24 years, I just said. >> That's 2002? >> Wow. >> doing LogoWorks. >> Yeah. >> Yeah. >> Yeah. >> We'll talk all about that when we get to it. >> So, Morgan, thank you so much for coming. This podcast is for entrepreneurs, startup founders, um those interested in fundraising and and financing, those interested in building anything. So, you are like the perfect candidate to come on this because you wear all the hats. And so, I'm excited to dive into every angle with you. And so, I have a full show agenda and I have a bio for you. So, and I think people need to know who we're dealing with here. So, if the bio is incorrect, correct me on the fly, but this is what I put together. So, Morgan Lynch is a repeat founder best known for LogoWorks and Needle. Um he started in in marketing, then co-founded LogoWorks in 2001 after getting fed up with the traditional logo and agency processes. Um LogoWorks grew quickly, landing at number 66 on the 2006 Inc. 500, which is huge, >> Yeah. >> with a 1,053% 3-year growth and later sold to HP through acquisition. >> Hewlett-Packard? >> Yeah. >> Legendary company. >> Yeah, I guess I got to say Hewlett-Packard even though I feel like I my generation and younger and even gen all know what HP is, right? A few a few years later, Morgan founded Needle, built around helping online shoppers get advice from real product enthusiasts instead of generic customer service reps. What makes Morgan especially interesting is that his companies were not built from abstract theory. They were literally built from frustration and pain and pattern recognition and the willingness to rethink how things are done. So, I'm super excited to have you, Morgan. I know you're building something new and I hope to talk about that today with Build Angel. Um we met about it probably Was that about 6 months to a year ago that we all met about Build Angel? >> Late last year, maybe. Yeah. >> And Build Angel, for those who don't know, um helps in the custom home building process to keep costs down and get more quotes and bids for the builder and for the homeowner as well. >> Yeah, bring bring in the power of AI into the construction industry, which is sorely needed. >> Yeah, sorely needed. >> Yeah. I'm excited about that. >> Yeah. So, um uh one of the things you just said about him from pain, it just reminded me of what I teach sometimes at boot camp how two entrepreneurs um uh the uh founder of JetBlue and then also Steve Jobs, they're marked with that same talent that Morgan has, which is they find pain that they've actually experienced and seen and turn into a great entrepreneur. >> you're you're doing again with Build Angel. >> Yeah, and that's really cool. And that's and that's that's literally taught as one of the brain aspects of top entrepreneurs. They just think of there's this problem, I got to fix it. >> Yeah. >> Yeah. >> So, was that all correct? Was your bio correct? >> It was pretty good. >> Yeah, pretty good? Okay, that's great. >> Accurate. AI did it for me, but it was pretty good. >> [laughter] >> No surprise there. >> Yeah. Um, I think that's one of the good things that AI is actually really good in task with is like putting the data together online and creating all the information across the web. Okay, before we kick off the episode and before we get into your history and where you began and how you became an entrepreneur, I do have an icebreaker. Every episode we do an icebreaker and we're going to play a quick game of this or that. I'm going to say two things and you tell me which out of the two things you prefer. This one or that one? >> Is it just for him? >> Nope, you're going to participate too. I want to hear both of your guys' takes on both of these things. Okay, you ready? These will be entrepreneurial-esque but also just kind of pop culture and just fun. >> Ready, let's go. >> Big market or painful niche? What are you choosing? What's more important to you? When you have an idea, when you want to execute on something, a big market or a very painful niche? >> Painful niche. >> Painful niche? Why is that? >> Well, I think the pain is what generates the idea. I mean, obviously creating a business in a small market is terrible idea generally speaking, but it's the painful niche that kind of at least wakes me up and gets me excited about, you know, solving a problem. >> Yeah. >> So, how about how about you? >> Absolutely, and I've even morphed on this even more in my older years, painful niche, because I'm getting wary in the AI age of horizontal plays and broad plays and, you know, we use the boiling the ocean analogy, right? And then hair on fire use case that you can get in a niche. So, it definitely painful niche is the wedge to get into the market. You may be something different three, five, seven years from now, but you won't survive the first 18 months if you You have a painful niche. >> Yeah, there's got to be a pain there. you're solving. Okay, next one's easy. Mountains or beach? What do you prefer? >> Beach. >> Beach. >> Yeah, I'm a beach, too. >> Beach over mountains. Yeah, hiking you never do hiking. Do you How about you? Do you Are you a hiker? Not really. >> Well, I am a hiker. I do paragliding and speed flying, so I really really like mountains. >> really like mountains, but you like beach that much more. >> hiking up them. I don't like hiking down, so it's a really great sport for that. >> Can I ask you a question cuz in Utah last week I heard somebody died. What was that? Was that paragliding or was it a different type? >> Uh from what I understand, yes, of course. Um it was uh in uh up in Draper Yeah. And he was speed flying. Uh not It's a little bit It's a different kind of sport. >> Uh It's not the squirrel suits. >> It's not It's not base jumping and squirrel suits. It's basically paragliding, but with smaller wings, so a little bit faster. And um >> Is it more dangerous? >> Uh can be, yeah. >> Was it just windy or something? >> I don't know the details. >> Me, neither. You know, >> It can be a safe sport, but you know, you have to >> from a pretty high It something happened. He fell from a high thing and died. >> So, sorry to hear that. >> was. >> Oh, well, I've seen I've seen those people going on the freeway when you pass Draper, Lehi area. You can always see them kind of jumping off those that kind of really steep drop-off there, so. >> Yeah, it's actually we actually fly off. We don't jump off. Base jumping's where you jump. I and I do think that sport is crazy We're a little crazy, yes. >> [laughter] >> Um paragliding's much safer. And by the way, and just a little promotion here for Utah. We have probably one of the top five spots in the world. So, these people you see um half the time as you're driving up the freeway, a lot of them come from all over the world to actually learn to paraglide here. This is kind of like the Waikiki, you know, of surfing, but for paragliding, yeah. >> But it's just the the >> We're We're super fortunate here in Utah. We have this condition where the wind is the the perfect speed almost every morning coming from the south. Hits that slope, which happens to be like a perfect slope shaped by nature, I think. I don't think that was man-made from the Bonneville shoreline days. >> Yeah. >> And it just creates a really great opportunity. It's It's really a Utah treasure. People come from all over the world >> not know that. >> Oh, yeah. Probably any given time I would guess maybe 30% of the people up there are from out of town or even international coming here to learn paragliding. >> That's crazy. No, learn something new every day. I had no idea. >> I I don't It scared the heck out of me. I got bought something or won something and I went up there and so there was a guy that I rode with like I just rode with a guy doing it. It scared the heck out of me. >> [laughter] >> So, like it's like, you know, when you jump out of an airplane and you jump with somebody, it was the same thing. Is that >> Yeah, tandem flight. >> Is that how they teach you? >> You can do a tandem flight up there and tandem flight something like that. I told you guys you should try it. It's actually a quite a safe sport, especially what goes on there at the point of the mountain. That's paragliding and it's not base jumping. So, give it a try. >> Well, all that >> I say you like mountains a lot, but you like beach more. >> Yeah, I do. [laughter] I like surfing and fishing. >> That's great. Okay, text or call? What are you doing? What do you prefer? >> Text. >> Text or call? >> Yeah, text. I mean >> Yeah, text is taking over. >> when there's something really serious and there's a point of conflict or something, you got to do a voice or video call or something. >> But how rare is it that you're actually making calls throughout the day nowadays? It's more like, "Hey, I'm just going to text this guy." >> Yeah. Yeah, that's crazy. >> Yeah. >> I text mostly because I think most people like to receive it. >> Yeah. It's more convenient. >> I actually do like to talk. >> Yeah. >> I think the under 35 or so crowd is just they prefer texting. >> Yeah. >> Here we go. Here's the Gen Z in us. TikTok, YouTube, or Instagram? What do you like more? >> YouTube. >> YouTube. >> YouTube. >> Yeah. >> I I actually like Instagram still more. So, I I do like YouTube, but I I'm still not a fan of like the just scrolling on YouTube. I only go to YouTube when I specifically want to look up something or watch something. >> It's even increased for me in the last year or two because I pay for premium now. I was so tired of the ads. I I I held off for so long and I go, "Why am I My time's valuable. Why am I wasting it on these ads?" So, I paid the premium. >> Yeah, I've been paying premium for years, probably since they offered it. Oh, yeah. I was like, "I can't stand these ads." But, [laughter] I >> I'm a DIYer, so >> everything on there, yeah. >> I literally pull up YouTube It seems like twice, three times a day cuz I'm actually I'm looking for someone to show me how to do something. It's so >> for that, but it's also just I I can go get news, current events, or something interesting way faster than anywhere else. If I want to see like 10 minutes of what's happening in this part of the world, and I see three different things and get some idea faster than trying to hunt for it elsewhere. It's kind of crazy. >> Okay, easy one. Pizza or tacos? Or neither. I'll give you the neither. >> Well, if it's a you know, true Italian pizza, then pizza. It's like, you know, American garbage pizza, then >> Yeah, no. So, tacos over that, but if it's true Italian pizza, you're you're choosing pizza. >> So, what was that? Italian? >> No, I said pizza or tacos. >> Pizza. >> Pizza. Me, too, actually. Um press attention when you're building something or launching something or quietly building? What are you doing? Do you like to stir up attention or do you like to just quietly build in your corner? >> I usually quietly build for a while, but then I love press later. >> Yeah. >> When I'm ready. >> Yeah. So, when you're ready to launch or you're getting some traction or you're you know this is go time, you're you're going to stir up some PR. >> Yeah, the timing's important. Early on, too much hype and buzz sounds like it could be fake or fluffy, right? But, after it's production ready, then you want the hype. >> Okay. Um podcast or music? You're at the gym or you got some time to listen to something or you're driving, what are you doing? Podcast or music? >> Always music. >> Music. >> And I'm podcast. >> Yeah, yeah, I I you are podcast. Music, huh? That's interesting. Um Netflix night or dinner with the wife? >> Dinner with the wife. Dinner with the wife? >> Dinner with the partner or you Netflix? >> Probably we like to watch stuff together. >> Yeah, Netflix. Okay. >> But we we canceled Netflix. We have other choices. >> Okay, last one. Here we go. Build a company people really respect or build a company people fear? >> Respect. >> Respect? Okay. >> Yeah, respect. >> Respect? >> Mhm. >> I don't know. I thought fear could have been maybe one to to switch it up there because you know, if people don't want to go against you or they're scared of you, you know, you got to self motivate yourself. I don't know. >> I respect is in between fear and being a milk toast. So, I like respect. It's the perfect middle. >> Yeah. Okay. Well, hey, we got to know Morgan really quickly there. We understand that you now know that Utah is one top five place in the world for not base jumping, but paragliding. >> Yeah. >> And that's the one that you do? >> Uh speed flying. >> Speed flying? >> a little faster version of paragliding. >> You do speed flying? >> Yes. >> Oh, wow. That's the one that that happened. Wow, I didn't know that. Okay. So, you know, Utah, just to throw it out there, 10 minutes from where I live is the Provo River and I think of that as just the Provo River. It ends up being one of the top fly fishing rivers in the world and you people pay thousands and thousands of dollars for a trip out to the Provo River to do fly fishing. >> crazy, too. >> I know. >> We're so lucky. We have so much here in Utah. >> Yeah, we really do and we need to protect some of these things, too, as with growth and all that. But we have some real treasures here. >> All the data center stuff going on right now. You've seen all that, too? >> Yeah, I've seen it. I I haven't studied a lot and all the all the growth is right. I mean, I can't believe the Utah County projections of the growth that's happening in this county. It's crazy what's happened last 10 years and what's going to happen in the next 10 years. >> from I just read a a that it 2050 the Wasatch Front from >> Ogden to like Nephi. >> Yeah, Ogden and Nephi will double. >> It will it's going to be one big city they're saying. >> Yeah, they but they're saying that >> 15 to 20 miles wide for like 150 miles long, one big city. >> Yeah. They they project by 2055 or 54 or something like that it will double from >> That's crazy. >> 2020 or something like that. >> Yep, yep. >> Anyways, >> All right. >> Morgan, let's get into you now. Now we're done with the icebreaker thing since we're playing that this or that game. It was great. But we want to go all the way back. So take us back as far as you want to go like >> Where did you grow up and go to high school? >> Yeah, where did you grow up? >> So I grew up in the Bay Area. >> Oh. >> And when I was growing up there the excitement around technology was well known. Even as even as I was >> South South San Jose, Almaden Valley. >> What? In San Jose? Wow. >> Yeah. So it was a I tell everybody it was probably one of the best places like ever to grow up. >> that's at the center of the universe for technology. >> It was. Of course there was semiconductor and and Apple was just basically starting out, you know, with the personal computer. In fact, I tell the story sometimes Steve Wozniak lived uh down the street uh in basically Almaden Valley and I remember uh he rolled in to my friend's court where at cul-de-sac there in in a brand new shiny red Acura NSX and I remember thinking, "Well, I don't know what he does, but it's probably it's a pretty good business." >> Yeah. >> This was uh Steve Wozniak, right? >> Yeah. >> [laughter] >> Cuz he's driving a red Acura NSX. >> And it was great. It was uh obviously he was with Apple and uh those were exciting times. So it was a really really great place to grow up. >> Wow. >> And I, you know, probably got the bug a little bit just you can't everyone's talking about technology when I was growing up. So this was >> normal. >> what was the high school you went to? What was the name of it? >> I went to Leland High School >> Okay. >> in Almaden Valley and it was a communications magnet. We actually had our own radio station there. And I did not >> DJ or >> Right. >> Uh but I I I loved the I loved high school in California. It was fantastic. I loved everything about it. >> And then where did you go from high school? What did you do? >> So, I came to BYU here >> Okay. >> That's the connection to Utah was Brigham Young University, yeah. >> Came to Brigham Young, and there I studied international relations. >> Okay. >> Uh I don't know what they call it now. It might be called area studies or something now. And I was thinking, well, I'm going to uh uh talking to a a counselor there thinking, what am I going to do? I don't know what fits me. And this is I think a lot of students and a lot of young people >> that. I went to your first school and you're like, what surveys, yeah. >> Yeah, and you're like, what what am I going to do? I don't know what I'm capable of. And and you know, it's funny. I never really decided, right? And I didn't have to. I was really lucky. Had a friend uh that I was working with, and he said, hey, we're I'm at this uh technology company. We're at the in the basement of Doctors Park in Provo. I don't even know if you know where that is. It's off like 800 North and like 500 West or something. >> I I have >> And it was called >> recently. >> It was called [laughter] It was >> It's still there, you know. >> I think so, yeah. And I drive by it sometimes. I think I work in the basement there. >> oral surgeon, yeah. >> So, this was a company called InsureQuote. And there were about 20 people there. It was kind of dungy, kind of damp down there in the basement. And they said, we need a salesperson. And we do software for for insurance agents and insurance companies. I thought, well, okay. I'll I'll give it a shot. And so, yeah, I started doing sales for this software company called InsureQuote. And again, there were like 20 people there. And a lot of people drinking Mountain Dews all day, if you know what I'm saying. It was a really heavy programming culture. And >> Yeah. >> And there were few few like one marketing guy, and so and me and a sales guy, and that was about it. And I >> I mean, >> if you said Logo Works in 2002, this had to be late '90s, early 2000s. >> yeah. And so, they were uh we were venture-backed. I think it was even Wasatch Ventures back then, if I remember right, that had backed InsureQuote. And we grew that. And that was a really good opportunity because we went from like the 24 people like 500, and we bought a company in Cleveland, and I kind of grew with that company. So, actually graduating from BYU was an afterthought. In fact, I already had my job before I finished BYU. >> Yeah. >> And I was already almost working full-time by the time I graduated at that software company. It was growing fast. >> Wow. So, you did sales there? >> I did. I'm not sure how good I was at sales. What happened was I mean, I was okay. Obviously, they kept me. But, by the time as we were growing, it was the whole marketing thing that was actually fascinating me. We didn't have and back then, if you remember, we're talking like if you had you need materials, you had to actually create a CD-ROM to distribute to people, you know, it like your electronic copies. That's how things were done. >> So, they didn't download software on the internet? >> Yeah, no, not yet. And so, we didn't really have some of the marketing collateral that we needed. So, I volunteered to do that, and that experience really led me to Logo Works, right? Cuz then I was going to ad agencies to rebrand InsureQuote. And that's how I figured out this whole design thing was really messed up, and I ended up, you know, going to a design firm here locally and you're in Utah County, and that really led to the whole Logo Works experience. >> So, what were you over the rebranding of InsureQuote? >> yeah. So, I kind of grew with the company and then took on more of a marketing role, and kind of moved out of sales because we didn't have anything we had no sales materials. We had We just didn't have a presence. We didn't have a brand. And so, I I took that on and and developed that. >> So, InsureQuote >> called Studio, by the way. Studio Interactive is was the agency. >> [clears throat] >> The agency that you used? >> The agency that I used. They were down in Provo in the river bottoms down there. >> So, InsureQuote bought a 500-person company or vice versa? >> Uh it was like I think 250 at the time of people. We already had by then I think 200. We were about 500 combined. >> from 40 when you joined or 20 when you joined or whatever to 250? >> Something like that. >> another company in another state. >> yes. Something similar. >> those together and then you became like 500 or something. >> Yes. >> Okay. Got it. Okay. And then you discovered this problem with branding, creating logos, marketing collateral. And where did How long were you there? What month and year did you leave InsureQuote? >> Man, dates are a little fuzzy now, but I it was probably around 2006-ish maybe I left InsureQuote. By then >> So, you were doing work on LogoWorks before that. Is that right? >> Yeah, I mean I >> I think so. Cuz I think the years are kind of blending together. Within the first year I met you. Okay, so I actually That was probably about the time maybe 2003, 2004 that I really started on LogoWorks. Somewhere in there. It's probably that I met you there. >> All right. >> Yeah, so I think the learning maybe for some, you know, entrepreneurs out there that are thinking, "Hey, I really want to do something." There's no shame in going to work for an you know, not doing it right out of college necessarily. I tell people all the time, "Hey, if you can go get your feet wet and go work at another tech company and really put your heart and soul into it and treat it like you were the owner." And I really did that. I mean I was so excited about what we were doing and it was insurance software. It's not like, you know, you can imagine these conventions. People make fun of insurance agent conventions. >> I went to them. >> Yes. Like every year in Scottsdale, you know what I'm saying? This was But I was still excited because I liked what we were doing. I liked the momentum. I could I felt like this was a really great place for me. And I felt like I was getting all the lessons without necessarily spending all the money and >> down on that advice. You're basically saying exactly what I like to say to people. If you don't have a killer idea that really is validated as a great idea to just go launch, going to work for a startup emerging company is the perfect thing to do. >> Yeah, absolutely. >> Absolutely. I mean, it would it taught me so many things there and I was able to if to grow and to learn things about myself basically, you know, with at the expense of >> think joining a 500-person or a 2,000-person company is quite as good cuz you get pigeonholed into a very You had the opportunity probably with 20 people the CEO can come to you and talk to you >> and say, "Hey, why don't you take this on? That's >> No, no, it was actually better than that is nobody's doing something. I think I'll step into this role and do it. That's the opportunity happens when you're in like a like even like a 10-20 person company. You just see a need, you go fill it >> Yeah. >> and you learn a lot. >> you grow. >> You get close to sales, customers, operations absolutely. And I I think the biggest thing is you see how money is made. Like you you see how oh, the things you have to do to actually make money. At like a 1,000-person company or like a law firm that's huge or like Google or some of these Fortune 500 companies, if you go to one of those companies and just take a role, you're not close enough to the customer. You're not close enough to revenue generation, you know what I mean? >> So, how did you um It's great point there and you can comment on that. I'm just curious I'd like to hear based on what you just we've been talking about your transition. How you went from Insure Quote and then all of a sudden Logo Works you said, "I'm going to do it." What was in between there? How did Was that a gradual metamorphosis or was it an overnight decision? >> It was somewhat gradual. I think we you know, we grew and we were we This is during the internet heyday. I mean, if you remember most people don't remember, but pets.com and all this kind of craziness. Well, there was this company called Channel Point. You can go look in the archives of the internet and find this one, but they were a high-flyer backed by insurance companies, had tons of money. Uh we were bought by them and I remember going out to meet some of the team out in Alameda. You know, they all had Aeron chairs, all these LED light displays, and they were just blowing money everywhere. I thought, "Oh my gosh, this is totally the opposite of what I'm used to." Like, Insure Quote was practically a bootstrap company compared to that, and they were just throwing millions of dollars all over the place. And I remember seeing their team there thinking, "Geez, they have like 20 people to do what three of us do." >> [laughter] >> I don't like this. I'm out. And I went to the CEO and said, "I'm out." >> Insure Quote and the Cleveland company got together, you were bought by Channel Point, correct? And so, after that merger, I didn't stay too too long. You know, I was like, "This is crazy." I I uh I just didn't I kind of felt like a fish out of water. >> The culture was just different. >> say this is really funny. So, they came in like the first day and they said, "Okay, you're you're making I think I was maybe $60,000 a year. That's crazy." And then I think they gave me 120 or 100, just like that. And I'm like, "Wait, what? You don't even know why you should Yeah, I'm probably worth that, especially after having seen what you guys are blowing money on." But, [laughter] it really angered me actually. Cuz I'm like, "If this is happening, like this is crazy. You don't even know why I'm good." I am good, but you don't know that. And so, I these kind of things really annoyed me, and I went went into the CEO and said, "Hey, I'm out. I got this idea." And it'd been kind of percolating in my head about the whole logo design and the design experience. Where we just spent tons of money and I wanted to fix that whole process. And this is a really important point I think for entrepreneurs, too. If you go into a company and you treat it like your own, the executives and people that you're working with notice. And this is really important because that's where I got my funding. So, the CEO, Bill Wone, um he of Insure Quote said, "Hey, okay, cool. Well, first of all, can you stay for like 6 months? Well, you can keep your office, work on your new idea, and I'll give you funding." So, I was like, "Okay." I was like, "What? This sounds great. Like, are you kidding me?" And I think some of that came just because, you know, I worked hard. >> Yeah. >> And uh he knew my capabilities. >> He believed in you. >> Yeah, and I think >> What a perfect setup. >> Yeah, it is a setup, but I think this is available to, you know, budding entrepreneurs out there. If you go and you work hard, people notice and they'll want to back you. That's important. >> It's relationship driven, though, too. You have to have a good relationship. Yeah, I mean, he he obviously you trusted him and he trusted you and he believed in you. >> So what So for all the viewers and listeners watching or listening right now, tell them what the first idea of LogoWorks was. Like, what was that initial idea that LogoWorks went and executed on? So we the I actually remember us sitting on a plane when the idea struck in my head, you know, I was like, "Wait a second. This whole process was really bad. I think I could fix this." And this is, you know, obviously the early days of the internet and connectivity was >> Tell about the process of a logo before cuz I think that's important for people to understand and what you transformed cuz you were big in transforming an industry. Yeah. >> So the idea was in a creative process. And by the way, this isn't necessarily too far-fetched from what we're doing now at BuildZoom. We'll get to that later. But the in a creative process where you're building something, sometimes you just need multiple ideas to find the one that the person's actually after. And so in the redoing the logo for insurequote, you know, we had basically one designer at this company studio doing the work. And he's really good. But whatever concepts he was doing initially weren't hitting the mark with us. Good design, just not hitting the nail on the head, right? It wasn't resonating with us. And so the thought was, "Wait a second. What I really need and what I can do as a kind of creative manager myself at the company, I need multiple ideas from different people at the same time." >> Different graphic artists and designers. >> Hopefully all good, but doing completely different ideas based on the same creative brief. >> Coming at it from a different angle. >> Yes. And so that was the whole idea and theory of >> having one of these persons do it though from a marketing agency or brand agency very expensive too at the time. >> Super expensive. Yeah, we're talking 5 10 grand. >> Yeah. Yeah, like back in the day it would be 5 10 15 20,000 just to get a logo proposal from a marketing agency. >> So then what what was LogoWorks and it was like, "Hey, come to LogoWorks and we'll give you 20 different designs by 20 different artists and you can pick the one you >> say, "How did that How did that come to your mind then?" Yeah, so knowing that we had the connectivity now with the internet, I knew we could get to designers pretty quickly. So we created a crowdsourcing back end. >> Right. >> It was before the the the word crowdsourcing had even, you know, been invented. Yeah, we we just outsourced it to designers, you know, via the internet. We presented them with the creative brief and let them do their design and we streamlined the whole process with a software platform. So really, instead of doing the whole thing where, you know, you had to go out and find a client, meet with them, do the creative brief, and then do designs that sometimes the client didn't like and go through that whole painful process and the end sometimes you didn't even get paid. It was a very inefficient process. Designers could do what they actually like to do. They look at information, get into Illustrator, >> and design. >> do design, and then >> and create >> and then create the output and put it the output in, right? And so it's super fast for them. And so we pay them, you know, it seemed like very little, but it added up very quickly and per hour they were actually making really good money. So it worked it worked really well. And for the client who got multiple designers and multiple ideas, we hit the nail on the head like 95% of the time, meaning there was one design out of those 10 or 12 or 15 that really resonated with the customer and they're like, "That's the one. I love it." >> Yeah. So would you still charge them that 5 to $10,000 price and then you would just basically divvy out that to all the different designers say hey you're getting 100 bucks 200 bucks 300 bucks. >> LogoWorks was selling logo design for $250 to $500. >> Yeah, so let's back let's back up and show how that worked cuz this is this taught me this. You taught me a whole new word in the ultimate realm which to me was I called it a distributed workforce. So in other words, you had a software platform on the internet. You invited people that just wanted to ideate and create but didn't want to run their own agency, didn't want to run a business, didn't want to have to go get their own clients, all the stuff of having to be a business owner, but they could just sit and create. But they didn't have to go work at one agency, they could work from home and create. That's kind of you were offering them like gig work. It was It was the gig It was the gig economy before it was named the gig economy. You were one of the first gig economy companies I would say. And so what happened was right? Is that what he did? And so you had you basically promoted the offer so all across the country and the world designers could come on your website, register to designer and then businesses that wanted a logo instead of going to a local agency and spending $10,000, they could for a few hundred dollars go on your site, put in their information, you got it out to all these designers and they made lots of designs. Is it Keep going with the story. That that's kind of the core right there, isn't it? >> Yeah, so I you know originally and this is interesting, you know, maybe from, you know, entrepreneurs that are listening, you know, originally we were going to fix the ad agency space, right? That was my experience. I didn't buy into ad agencies. But what we realized was our offering was so efficient that we could offer a price point around $250 and $500, still have some margin and it opened up a whole new market for us. And these were all the small business owners, you know, and there's like what? 20 million of these small business owners in the United States. And of those, you know, they need a lot of logos and a lot of design. Of course now it's totally different with AI and all the options you have. You can create a logo in 10 seconds in AI and and stuff. >> that way before. >> It wasn't. And so, this offering was really powerful because they had you could really bring high-quality design to a business that normally couldn't afford it. >> Right. >> So, what it actually did was open a whole new market for us. So, in fact, originally the name of the company wasn't LogoWorks, it was called Art This, and we were going to be competing with ad agencies. But we quickly realized we we were in we're better off opening a whole new market of underserved people. >> Mhm. >> And it was way bigger. >> Yeah, so a big corporation still goes to an ad agency and pays $20,000, gets a logo design. >> Sure. Ad agencies exist today just like they did back then. >> plum- the local plumber can't do that. He's the local plumber wants a good logo for his plumbing company, and he goes to you. >> Yeah. >> Yeah. >> So, it obviously went well, cuz [laughter] I mean, you got acquired. I mean, tell us Okay, you when you came up with the idea, named it, give us the first year, what was it like? >> Oh, the first 2 years. I mean, so we my co-founder, Joey Dempster, he and I ideated on it for a long time. In fact, he lived in an abandoned house called the spider house up by Y Mountain. I think it's since been destroyed, hopefully. >> [laughter] >> Literally, he lived in this basement, the ceilings were falling down. It had been condemned, actually. But he lived there, and we would >> Full of spiders, apparently. >> [laughter] >> Completely. It was really bad. But that was our basically corporate we we called it the world you know, corporate world headquarters. >> [clears throat] >> Yeah, and so we we really thought about the process a lot and worked on it. He was great. He's he really brought Between us, we we really thought deeply about it and came up with, you know, I think a really good solution that then scaled. And you know, from there it took a while. You know, so it wasn't like an overnight success. Like we had to go through this process where like, oh, we're competing with ad ad agencies, and then realized, no, wait a second, we can do this. And And then we had to go find the the original, you know, the the first projects that we we were doing. We would put up billboards, we did mailers, we did all kinds of stuff to find these small businesses. This is before you really could do even, I mean, you could do Google Ads. I can't remember how early. And of course, we did those things, but we had to get small businesses to buy the logos online. That was asking them a lot back then to put your credit card in online for 250 bucks back in like 2002. That was a big ask. >> Yeah. >> Um now it's like no big deal. We all buy cars online and stuff. But back then, people weren't buying that kind of stuff, big ticket items online. This felt like a big ticket item. So, we had challenges. Took a while to to get this going. And you know, I had to do the friends and family funding thing. I think I even asked you to to invest, maybe. >> Yeah, we PF20. >> [laughter] >> Do you remember the lunch? >> He said no. >> I do. >> Just for the record. >> But I was pretty new >> [laughter] >> You know I had to bring that up. >> Yeah. But yeah, yeah, that Shoulda done it. >> Yeah, I know. He's got a lot of those ones. >> Yeah, I got a lot of those stories. Hey, we all do. >> I hit some, lose some. >> Yeah. So, and I'm sure we weren't that great at explaining it then, and it took a while. That's the thing. Some some of these process, when you're going after a process that's complicated and hard, you know, you might have to spend a year or two. And everyone loves to just jump in and talk about, you know, especially now, you know, these companies and and I like them too, and I'd love to invest in them, you know, the jump from like, you know, a million to 10 million ARR in like 3 months. That's awesome. I love that. Um but there are >> Not that easy. >> No, but there are also plenty of good businesses that will take blood, sweat, and tears for a year or two, where you have to figure things out. There's no shame in that, either. >> I'd say that's the norm. >> How did you So, this is a two-sided market here, right? You've got to You're bringing together designers, and you're bringing together small business and medium business people needing a logo. That's the core of the business. How did you attract them to register on your website? >> So, this is the yeah, the the balancing act that you have to do, right? So, I mean, do you remember when we first got some projects, we actually had people put their credit card in online, like, "Oh my gosh, this person bought a logo." And I'm like, "Now we got to deliver." >> [laughter] >> Like, what we got to get some designers to do this. And I remember and I'm sure there's a bunch of designers that they're listening to this podcast, they just start laughing cuz they're the first ones I called, the ones that Well, a lot of them worked at Studio, um and guys like Rob Kirby and Jared Fish and uh oh man, there's so many >> You're just like, "Hey, can you make me a logo?" >> Literally, I was like, "Okay." It's like the man behind the curtain, you know? Cuz they said, "Yeah, give me Give me, you know, three designers and all the logos." And I'm like, "Okay." And so, we didn't have our platform then, so we were uh Joey and I would sit there and we had like a little thing up on the wall and we'd be like, "Okay, who are we going to assign to this one and this one and this one?" And it's eerily similar, frankly, to what we're doing right now building building Angel 2, by the way. When we go get subcontractors to help on projects, it's similar. At some point, though, it will scale. And as you go, so as we acquired the work, meaning the jobs, then it became self-service at some point because designers get used to the fact that, "Hey, I can log in. I can see projects." In fact, it will notify me and tell me, "There's a project here." And they will start taking them self-service. So, it's a given now. Everyone understands crowdsourcing and the gig work. If you have work, there will be people that will want to come do it. >> You were super innovative and cutting edge at the time you did all of these functions that now people accept as commodity. >> I did the same thing 5, 10 years before you with co-branding websites. You know, every It's obviously common now to co-brand a website, like, put, you know, and we did co-brand websites before we called them co-brand websites. It was really popular. And now, of course, it's just standard, right? And that's And now what you've done is standard, but back then, it was cutting edge. Yeah. >> So, okay, so you get get it rolling, you actually create the software, you have the platform now, you start seeing probably some kind of tipping point where it's like, "Okay, this is actually working." What what was that moment? >> Yeah, my question back to that was how did you get enough two-sided market you because you got to have enough demand for logos and enough designers. How did How did you get that all happening? >> It was I mean, it took you It took a couple of years. >> demand at first? Was it harder to get demand for logos? >> It's always harder to get the demand. It's always harder to get the job done. >> at first than >> logos. >> That wanted to be created. >> Yes. The It's always hard to get the work. >> Yes. >> Well, once you have the work, there are people that will want to do it if the conditions are right and you're paying fairly and you're paying on time. That was Honestly, that was probably the the thing that designers loved the most was that right when they uploaded their stuff, we would within hours >> Uh >> Pay them. Yeah, pay them. >> How would How would you make sure >> Zack, we were the one of the I can make this claim to fame. We were one of the largest PayPal users You You used to have this thing called mass payments and you would literally send like a a spreadsheet of the payment. >> CSV file or something? >> Yes. And it would it would literally fire off like a hundred payments like 35, 50, 75 bucks or whatever it was. And we would do that. But we would do it instantly. No questions asked. So they upload something, we pay them. >> How did you know that they weren't like scribbling on Microsoft Paint or something? >> Well, >> Did you Did you Did you verify the >> Yeah, so there was a whole reputation system and gaming system in there where, you know, your peers would review your work as well, which they love to do. Review and and rate work. And so if you were If you If you did that even once, you'd be kicked out of the system. And nobody wanted to do that because it became something that was really important because they for a a you know, gig economy for a side hustle, this was a great income. So you wouldn't want to mess that up. And people generally take pride in their work, too, you know? Most people do great work. And want to do good work. >> So very few bad actors ever came through, yeah. >> Yeah. >> So in other words, the customer, the business comes in, pays upfront on a credit card to get a logo made and to get several designs so that they can choose a logo. And then you issue that out and 10 people or five or whatever respond and make a logo. And then what happens from there for the system for people that aren't familiar with it, how did the business owner then chooses one of the logos? Does everybody of the 10 get paid that made a logo or how did that work? >> So, in our system, we paid everyone every time they did something. Now granted, it might have been $20 or $30 or $40 for that initial set of comps, which probably only took them about an hour. >> Yeah. >> So, at your minimum, you're probably making 20, 30 bucks an hour. So, yeah, but if you got picked by the customer, >> And you got yours one, >> then you got an extra 50. Right? So, now, you know, >> Oh, so you kind of like made it a competition. >> that what I mean we just aligned we just aligned the system >> in hourly rate. >> Yes. I mean, we aligned the payments so that you would you know, hopefully read the creative brief and design something that the client wanted. That's That's what we're trying to do is make the client happy and get them something that's professional and good for their business. >> How did this grow then after the first year or two, then what happened? >> Well, you know, we we just started investing more into domains. Back then you could domain, you know, games were, you know, we did white hat. I wouldn't say we did too much black hat stuff, but we did a little. [laughter] You know, with uh subdomains and things. So, we had SEO strategies that were, you know, don't work today, of course, but back then they did. So, we bought domains and subdomains and and and really did a ton of SEO. That was huge. You know, the thing though that actually grew our business that was unexpected more than anything else were two things. Uh and I didn't anticipate this and frankly saved our business and made it work because we if we just had to spin always to get new clients, it probably wouldn't have scaled as well. And that was word of mouth. So, uh people came in, of course, to get a logo. And then we had this thing called the ask a friend feature. This was so critical. So, everyone wants to get their friends' opinions on their new logo. And so, they put the emails of their friends in there and say, "Vote on these." And we'd have them come in. So, we exposed like we exposed like 6 10 people to every single, you know, to LogoWorks on every single project. And business people typically have their friends or other business friends. And so, that was like 20% of our business. >> That's freaking genius. >> And then, um yeah, so there was the ask a friend feature. And then the repeat business was a shocker. So, these people starting small businesses, they would either fail and start another one or they just start another one, right? If it was going wild wildly successful. >> first thing you need when you start a company is a logo. >> Yeah, so I would say I seem like almost 40% of our business at any given time was either word of mouth or repeat customers, which was huge. So, yes, we could spend money to acquire new people and then with the word of mouth referral that that grew our business. >> So, at the height of LogoWorks, when HP comes in, probably around that time. Yeah, how many years till that? >> I mean, it was like 7 years or something. >> But what like give us an idea of like what was rev- revenues on this? Like how many logos were you If you were charging 250 500 bucks a logo, you were doing a wild amount of >> our run rate was up around 15 million, I think. >> That's insane. But we weren't just doing logos by then. We were also doing, of course, websites and brochures. >> Promotional products, all kinds of things. And we had a great team. I mean, I don't want to also leave out in this whole story the importance of getting uh really great board members and then just the team that we had was incredible. I look now the things they've gone and done and it's like >> Yeah. >> I was like so lucky to get some of these people involved with LogoWorks. It's crazy. >> Now, at one point I remember, and you can correct me if uh if I'm wrong here, but I remember at some point you had so many logos to be done and this distributed network out in the internet ether that you also had to meet demands sometimes had to have your own people here locally and get more producers could to keep up with the demand. >> You know, did you hire your own designers even to do that? >> Yes, so it's it's funny. We started as a completely outsourced company, but then at some point we also realized it's nice to have a release valve inside in case someone didn't show up or we needed someone to pinch hit. >> Yeah. >> And so yes, we did have I think we got up to maybe 20 or 30 in-house designers here in you know, right in Linden at our office there. And then we did that for a couple reasons. One, it was a little bit more profitable, but even then that wasn't a really great reason for for doing that. It was more about having a safety net and the ability ability to pinch hit. >> In the 20-plus years I've been mentoring and talking to thousand thousands of businesses, I've come across different manifestations of your model in different industries and all of them have to do that to keep a baseline so that they can never be without that, you know, if they're using a distributed workforce, sometimes they have this demand and that distributed workforce not taking care of it. They needed the people in their office and I think Toptal and Upwork might have just interviewed somebody that told us about that. And that's just a common thing. So that's you you can't just leave it out to this distributed workforce all the time because you might fall short of getting things done on time, so. >> I don't know. Maybe I mean now to be honest, I think you probably could at least in what we were doing there because it's such a given. Yeah, everyone so many people are doing gig work. >> but back then. Yeah, I mean the gig economy hadn't even been coined as a term and when you were doing the gig economy. >> That's right. >> Yeah, so pretty fascinating. Pretty cool. >> Listen, I joke around with everybody and say, you know, the next one why didn't I pick transportation, you know? Yeah, yeah, yeah, Like cars. I look at an and I'm like, "Why didn't I pick that?" I picked I picked logo design. I mean, it still it was still went still went well, but you know. >> What even What what what was HP's reasoning for acquiring and coming in and buying you guys up? >> So, about 7 years in you got acquired. >> Yeah. >> Yeah. So, they they had a whole division up in Idaho. The printing division that serviced small businesses. And their business was selling ink. Ink's very expensive. And if you want to consume lots of ink, you need to have cool things to print. That's the quick version, right? So, they were they were building some services for small businesses to help them use more ink. >> like, "Let LogoWorks us >> Well, it's fun fact >> back in the day, I don't know if this is true with today's prices, but I think it's pretty close. The HP toner little cartridges that you pay 50 bucks for a little cartridge on for your HP printers and they want to sell the printers were sold at below cost because the toner was where the money was. And I once talked to the guy at Dell, of course, Kevin Rollins, who taught me this and he said if you took those cartridges started emptying them and put them in an average Toyota Camry gas tank to fill up that gas tank with that toner $250,000. >> [laughter] >> Yeah, so I think I mean >> Think about that. >> I mean, yes, the ink was important to sell, but they were building out services for small businesses. >> the software and services and other products. More offerings for small >> More printing and ours was a really cool offering for small businesses. In fact, we went and did some joint you know, meetings with them when they were talking to investors and all that and we were kind of like a kind of the sexy cool, you know, new small business service that they could add into the >> Yeah, like LogoWorks, we just acquired them. Look how cool they are. The irony is in the first 20, 30 years of the digital age or the computer age that was supposedly supposed to get rid of paper and printing so much stuff out, it actually generated for about 20 years way more paper printing. And so, that was in HP's favor, right? Cuz they were the leaders in those printers. Kind of fascinating. >> So, let's just spend a second on the exit, cuz founders and entrepreneurs love to talk about acquisitions and exits. You know, what's something you learned or something that was like a new learning moment for you during the whole process? >> whom? >> So, Jeff Curl was definitely instrumental in this. He'd been doing some investor conferences and things, and uh I think he initially made the first contact with HP, where they uh learned about it. The, you know, by then we'd raised money from high-profile Silicon Valley VCs. >> Oh, you went outside of Utah. There wasn't anything in Utah, really. >> Oh, no. There was stuff in Utah. We didn't get money from them. >> Oh, okay. >> Um I'm not bitter about it or anything. >> Yeah, yeah, yeah. >> Nobody >> No, no, no. It's It's fine. By the time >> No, in this case, we one of our board members, Kathy Schlein, who was just so helpful. You know, she She just knew everybody out in the Bay Area, so she made some introductions, which were obviously invaluable. >> Mhm. >> By then, though, we were pretty much self-funding. Now, I look back at it and think, well, who wouldn't have funded us? You know, we were basically self-funding a company, yeah, growing, and had a great [clears throat] team and momentum. We went out there to Sand Hill Road, and, you know, basically got term sheets from everyone we pitched to. >> Yeah. >> And it was It was really great that we got Benchmark, so I think we were Benchmark's first deal in the state of Utah. >> Mhm. >> And that's That's a claim to fame. >> Mhm. Yeah. >> Yeah, so Bob Kagle did our deal. He was E-Boys, and uh you know, the book E-Boys is written by them, eBay, PayPal, and that. And he was fantastic as a board member, by the way. I had nothing but really positive things. There were a couple, you know, hard emails I got from him, but otherwise, he was helpful. And this is also, I would point out, you know, venture capitalists that are really great and uh one of their biggest contributions can obviously be in the you know the the details of running a company but in this case Benchmark was certainly helpful on the exit HP. Their name alone >> Yeah. >> meant that it was a stamp of approval that brings value like hey we invested in this company we did our due diligence and we think they're they're worth a lot and so on the exit value there is no doubt that both Shasta Ventures and Benchmark brought incredible amount [clears throat] of value to >> and listeners that don't know Benchmark Capital which still exists today is very influential at the time was definitely in the top three VCs in the world. >> Yeah. Yeah so we were lucky to have their their money but also you know we had a we had money from a fund called Shasta Ventures with and we were their kind of one of their first deals Todd Francis board member and that did our deal was so helpful. I mean I can't stress this enough to entrepreneurs like if you have the opportunity to get a world-class investor involved in your company and Todd Francis just a great human being but also had the time and energy to help us took us all over the place introduced us to people was really active super helpful. Bob Kagle didn't have as much time cuz he was doing a lot of big deals but you know between those two we had like big air cover and then we had a hands-on venture capitalist that was super helpful. If you can get that as an entrepreneur it was incredibly helpful. >> Yeah so our last episode which will have aired by the time this episode airs they talked about like being the founder going through M&A a bigger company like that acquiring you that it becomes like a second job and it's kind of stressful and all consuming. Tell about your experience with company like Hewlett-Packard sniffing around your company wanted to do due diligence then acquiring you. How was that? How long did it take? What was the experience like? >> So, I'm probably the opposite case from this is I'm an outlier. And that's that I had Jeff Curl and Paul Brockbank both kind of running the deal, so to speak. Yes, I had some conversations with them. >> and Paul Brockbank are very noted in Utah. >> Well, Jeff Curl's been on the podcast. >> Yes, exactly. >> Yeah, so when you have guys like that, you know, I kind of just stepped aside almost. Yes, I'm the CEO and yes, I'm I have to just sign off on things that are like >> of took that and you were able to keep operating the company. >> Absolutely. I was um Yeah, I mean, frankly, I didn't I didn't I knew they had the experience, too. So, I'm like, of course I'm going to let them mostly run this deal because I knew that I didn't know enough probably to be dangerous. Not only that, but you know, with a company like HP, I I recognized really quickly that I'm the crazy entrepreneur in the room. And what they want, a big company like a at the time it was like a hundred six billion dollar company, yeah, right? >> Yeah. >> So, >> They want a stable business-like atmosphere. >> Yeah, they love Paul Brockbank and they like Jeff Curl, but me not so much, right? They're like, who is this guy? And it's interesting cuz I didn't actually stay at the company after they bought us. >> Yeah. >> And because I'd done my homework, they'd just acquired Snapfish and I remember meeting with the entrepreneurs there. I forget the name of the guy who was still at HP at Snapfish. He's like, Morgan, you're not going to like this. >> Yeah. No, 99 out of a hundred times the founder's not going to stay with the company that acquires them for very long and it's not going to be a fun experience. >> Well, there's just no more upside for anybody, right? >> Yeah, it's just it's just that's the way it is. My first my first company I lasted a week. >> If the company well, honestly, if it had if it had been a more aggressive, probably smaller company, I think, you know, I would have loved to have actually grown it and kept it going and like kind of seen it off into the, you know, in the future. But this was a really big company, very bureaucratic and I I whoa. >> Even when it's not that big, it's just very the number of of entrepreneurs that have sold their company that I've had knowledge of and been involved with is a great number and I can't think of I can think of less than five that stayed longer than six months. >> Yeah. And >> [laughter] >> So, I don't I don't want to rush beyond the next one, which was Needle. I don't know how many how much time you had between LogoWorks and Needle. So, you sold LogoWorks >> was that you sold about? >> Oh, man. >> Like 2000s? >> I think it was 2007, 2008. >> Okay, got it. Okay. >> Something like that. >> And then go ahead, Tyler. >> And then and then from LogoWorks was Needle the next move? Was that the next company? >> I actually did an MBA program in between. >> Oh, where? >> Uh in Lausanne, Switzerland. >> I've had other friends that have gone and done that, yeah. >> Yeah. >> How was that? >> Well, okay. >> [laughter] >> Um >> And why did you feel you needed to do that? >> Uh but I I felt I needed to do it after I had my exits and then I had a friend of mine tell me, "John, you've already earned your MBA. You don't need to go do that." >> [laughter] >> So, I I wouldn't have done it in the United States. I really picked it because of Europe. I I like Europe. I served an LDS mission in Italy and and I've just like a lot of things in Europe. So, I'm like, I want to go have an experience there and meet some meet kind of meet people and >> with how many kids at the time? >> I think three at the time maybe by then. And so, I I chose to do that and I kind of regret the MBA part of it. Let me say So, I'll say this first. IMD is a fantastic school and it I I the people part was just like I'd hoped. I have the best friends all over Europe and they are really great people. I was a little bit of a fish out of water out there because all these people are coming from big corporations and I just sold my company to big corporation, which I didn't like necessarily, but yet I'm kind of doing a school that's geared for people that are going to end up in big corporations. And so, I did fine, you know, I I got all the coursework done and all of that, and I kind of thought maybe I needed it, but I didn't. And I will say this as directly as I can, I think it kind of ruined me for a little bit. >> Yeah. >> Meaning you know, it's a different type of education. It It probably >> Did it jack up your risk tolerance or something? Or like >> I don't know. I can't explain it. >> to >> You know, obviously all education is good. Um I The things that were taught there are are good principles that work in big companies. But as much as they want to try to study and teach entrepreneurial things sometimes in an MBA program, they just can't do it. >> not the same. >> You're kind of >> You're preaching my gospel. >> You're kind of born You're kind of born with it or you're not a little bit to some degree, you know? >> know if it's born with it, it's just that those teachings have now been proven through academic scientific research that big company tactics and strategies kill startups. They don't just hurt them, they kill startups. You cannot act like a big company with strategy and tactics and survive the startup world. >> you're saying is startups are not just mini corporations, they're a whole different beast, right? >> Right, exactly. >> Yeah, if you're if you're really into startups and that, just skip the MBA thing completely. >> Yeah. >> Yeah, I'm going to tell everybody a little stat because this is relevant. I spent 12 years teaching at a major university, Brigham Young University, which went from nowhere ranked when I started to number two in the country or the world in entrepreneurship programs, really strong. I taught countless undergraduate classes and two or no, two MBA daytime MBA classes, one executive MBA class. The undergraduate students would get taught and they'd go, "Oh, he says I can do it. I'm going to go do it." And they count created countless successful companies that went crazy. In the MBA class, they did better work, better research, better PowerPoint presentations, better oral skills. Everything was smarter, better, higher quality. But very few of them after actually come up with great ideas and companies that could make it would ever launch their companies. They went and got their jobs or they just somehow it didn't happen. Nothing really came out of the MBA students that I had the experience of seeing in my entire 12 years there. All these incredible companies like Divvy and Podium and everything coming out of undergraduate students and a countless others and MBA not so much. And I what it is to me is that the MBA kind of beats the entrepreneur out of you. And that's what you're kind of saying. You just kind of ruined you for a couple years. That's >> That's so funny. >> [laughter] >> No, not It the school's great. I learned a lot of great information. >> It has nothing to do with the school. It's just that if you learn big company strategy and tactics and then try to apply them to a startup, it's not going to work. >> I would agree with that. >> Yeah. >> Okay, so I was trying to not glaze over Needle, but I do want to get to what you're doing right now. But say a little bit about where you went to after MBA then. Was it Needle then at that point? So tell the viewers and listeners a little bit about what Needle was, what happened to it and what you're doing today. I don't want to go too quick, but we are kind of getting to the hour mark. >> Wow. >> Time flies. >> I know. It's been 58 minutes. >> Woah. >> So Needle was again a distributed workforce as you called it or crowdsourced application for online sales, right? Where we wanted to bring advocates, people that you and I would actually like to talk to about buying a high-ticket item or considered purchase, right? So if I'm want some skis or I want to do a cruise and spend 5 grand on a cruise, who do you want to talk to? We want to talk to people that have actually been on that ship and can tell you about it. And that's the people that we would bring into the equation and they would be at home or wherever they were on the road and on their laptops and they would field these conversations live with people about ready to you know buy a considered purchase online. And that was the whole model of Needle. And I started with Miko Valimaki and Joey Dempster who was with me at LogoWorks. And they were great and we start scaling that business. >> So you got a lot of the same team members back? >> No, I wouldn't say a lot. Some. >> Just one or two. >> Yeah. No, there was a handful, yeah. >> Yeah. And you just like, "Okay, let's do this thing again, but now we're going to go attack consumer products basically or consumer experiences or anything. Any consumer facing >> was it was literally chat. So we weren't even doing voice. We were just doing chat online. So it was very targeted. >> I want to buy this grill. Okay, someone who bought this grill talk to this person who wants to buy the grill. >> Yeah, and then now we're all used to AI, the little button you push it there and you're going to be talking to an AI agent, you know, or something online. And it's it's pretty good now. But before that, you remember your options were talking to a customer service rep who literally couldn't afford to buy half of these products that you were about to buy, right? So if you ask them any questions about it on a sell side, not like, "Hey, where's my product? I hasn't arrived at my house." We're not talking about customer service, we're talking about sales, right? Like I want to buy this. It's like 5 grand or it's even just something like Nike shoes or Adidas shoes. Adidas is a big client of ours. And I play soccer and I want the best pair, but I play on really hard dirt, you know, which ones do I need? And then all of a sudden soccer pro pops up. The picture of him is like, "Yeah, I actually play in the third league in Spain. Let me tell you, this is the one you want." You're like, "What? Like I'm talking to this person?" That's that was the whole Manito model. It was really cool. It worked. Because the trust factor is really high. >> happened with the company? >> It failed. Um, you know, for a variety of reasons. The um, the biggest, I mean, it probably was that and I made a a ton of mistakes and these were, you know, it's kind of clear now, right? You look back. I think I was focused, you know, we had a really cool niche product, but we didn't integrate well with the systems of record and CRMs of the time. And this is a really good learning for everyone, right? You know, it's nice when you have something really cool and innovative and disruptive even, but it you got to play nice in the sandbox. And I was probably a little high on my success maybe at LogoWorks or something thinking we can just force this into the market and it's so good and it really was a good product. People that know Needle, like we killed it. We sold a lot of stuff and we were we had the best people talking to people. The customer experiences were off the chart. Like and so I think we kind of believed that and we spent less time integrating with like the CRMs of the day that actual customer service people were using in companies and so we became this kind of stand-alone product and that's dangerous when you're kind of this one-off thing and >> So you're saying like you should have been a bolt-on to Salesforce or some CRM? >> Absolutely. We should have focused on that right away. >> I love to point this out cuz you're teaching such important principle. Your go-to-market strategy is very important. So you can be a 10x disruptor that's so valuable that you can be stand-alone. But some companies need to be a bolt-on product to an existing product for market entry. Their market entry strategy, there's several different strategies to take. It's not always I'm going to be the coolest thing in the world so you know, I just have to build it and they will come. No, it's going to fail if you choose this strategy versus this strategy. Does that make sense? >> Yeah, no, and frankly we picked the wrong strategy in that we were so high on what we were doing and it was cool, but we didn't play nice in the sandbox. We didn't put the and say, "Hey, listen, we're just right now we're two standalone and we need to be integrated with what they're using whether we like it or not or whether we think it's dumb or not." And by the way, I did think that most of the stuff the companies were doing was completely dumb. Having these call center people that were just totally irrelevant and it just seems so obvious we had a better product, right? And so it should they should just buy it. And they did and we were successful at that, but then it was also easy to turn off because we weren't we didn't have the hooks into the company. Yeah, and so when that first customer cut us, just some guy came in, I remember it was at Adidas from North America from in Europe and some guy from Oracle or came in and had used Oracle. He said, "Oracle has chat. Why do we need this Needle thing? Kill it." It was a million-dollar revenue stream for us. >> Yeah. >> And he just killed it. And that started the whole vortex of pain. And you know, had we been integrated tightly in there, it would have been really hard to rip out, but it wasn't. And so I made that mistake and >> That mistake really hurt. See, it's not just enough to be the a great widget. You have to be an entrepreneur that understands it's not just about product, it's also about strategy, go-to-market, channel partners. Those are very important, too, to success. >> Yeah, I mean, we weren't sticky. >> Yeah, but this is why I love your story cuz we go from Logo where it's complete and utter success to Needle cuz I I remember, Morgan, when you were doing Needle and kind of probably I I I remember hearing about the fundraising rounds around Needle cuz that was right around the time I was doing DevMountain. I remember you guys hired a lot of DevMountain grads from what I was doing over at the school and didn't How much didn't you raise a lot I I'm just for learning purposes only, didn't you raise a decent amount of money on Needle? I remember >> I don't remember exactly the amount. It's probably around 20 million. >> You had 20 mi- I remember there was like a $10 million round or something that and I remember going like, "Oh, we need to get some graduates at Needle because they just raised a lot of money." And um so yeah, I I money doesn't solve all the problems in the world, right? Even if you go and raise massive amounts of of fundraising and financing, I think a lot of entrepreneurs need to know that. They think that fundraising is the end goal, where fundraising and financing is not the end goal. You still have to make a a validated business model. >> when some of the problems start. Yeah. So so what's after Okay, post Needle now. So when did Needle What year are we at? The late 2010s or something? >> 2014, 2015, I don't know. >> then what have you done the last >> By the way, that was like a you know >> It failed. >> Yes. >> And you know, I stayed with it pretty much till the end. >> Yeah. >> Eventually got sold, you know, for for less and all that. And man, I just made I made so many mistakes there. >> Yeah. >> So but I learned everything But I stuck with it at least, you know, I didn't bail when things And I wrote checks in every round. And it was a considerable amount. I mean, I So it was But at least I'm proud of the fact that, you know, stuck with it enough to like see it to the end. It was painful. I remember I was This is maybe helpful to your viewers. I remember the board at one point sitting around saying, "Hey, you've tried everything. Like we We don't have any more ideas. Like it sometimes things just fail." And I'm like, "Yeah, wait, you can't say that. You're my board." And they're like, "So keep going. You can't just Yeah, you're doing the right thing. We don't know what to tell you." And I was like, "What kind of board meeting is this?" They basically just told me, "You're You're working hard, but we're not sure you're going to save it." Literally, it's like the plane is going to crash and we've seen this movie. We don't know if you We don't think you can save it. >> Yeah. >> But you got to keep trying. I'm like, "Yeah, I'm going to." But >> Just interesting. >> So um the last 10 years then bring us forward up to Build Angel and tell us about Build Angel. So the last 10 years, what did you do and Build Angel? >> So I took a little bit of break kind of after that. I mean, I honestly, I was mentally almost incapacitated to some degree. Not a lot of people know this, but it was rough after that failure of Needle. I mean, like the the just being a part of that and have watching your team leave and having people just up and leave. And I get it because it was failing and they need to go provide for their families and stuff. But man, I just felt like I couldn't call anybody. You know, you're in that dark hole. And if entrepreneurs have been there, they know what I'm talking about. And if you if you haven't the first time you have to lay people off >> about. >> Yeah, [laughter] no, it's it's so bad. >> company has the ups and downs and when the downs come and you have this like this feeling of I have to save everything and you're just you can't save anything. >> Well, I I always thought every entrepreneur has ups and downs. I thought if I you know, if I just work really really hard and work harder, I can save it. Like I I did really till the end. I believe I could do that. >> Yeah. >> And it didn't happen and I I I tell people this, you know, so if you're thinking of doing, you know, a business and I know you entrepreneurs always think it's going to work out, but if it doesn't, you know, I there was times when I would literally go out to my car and I would just sit there and scream in my car by myself. I'm like, I can't do this in the company. They would all be like, "What [laughter] the heck is going on?" But I just sit there and be like, "Like what am I going >> Josh James told me flat out and he tells others five different times at Omniture, which was a wild success, or gave birth to a lot of what we see in Utah. Five times he came home, told his wife, "I can't go back." and he was in a ball on the floor crying. And his wife had to kick him say, "You're going back tomorrow." >> [laughter] >> There you go, right? Good wives are key, by the way. >> Yeah. >> Yeah. >> And I've I've been lucky that way. >> What's so funny is Blake, the managing partner of Pelion Ventures, Blake Modersitzki came on the podcast and I said, "Hey Blake, what's the one thing you look for in an investment?" And that's what he said. He said, "Who the partner of the founders the founding CEO is." >> the spouse. >> He said he said, "Whoever that spouse partner person that they have in their life, that's the number one thing I look at." >> We also look at that as with our venture fund. We want to know like and and often it's especially the CTO's spouse. We want to know the technical founder's not going to leave because he's got to have his family aboard for it, too. So, it's kind of cool. >> Um so >> Take bring us back to the >> yeah, so finally I mean after some years of doing other things and um it was really great cuz I was there for the years of my kids all in high school and I had a little extra time with them. So that was great. So then we started almost a year ago Build Angel, right? In Build Angel, we're about protecting homeowners that are building custom homes, right? It's like, you know, Zillow came online and brought transparency in pricing to home buying and we're doing the same with pricing information and bid comparison, competition to bring transparency to the custom home building process. >> All the detailed line item estimating bill I mean lumber, concrete, excavation, you're trying to bring to the surface these pricing, how things are priced regionally, locally, all that and you're trying to >> Yeah, so if you're going to go build a custom home, the biggest obstacle you face is that you don't know how much stuff costs and so you rely on other people exclusively. Now, luckily, with AI, you can get some information, but it's really hard to evaluate that because we don't build homes, right? We you probably do it once in your life, maybe twice. And you just don't know the cost and price information. So we're going to and have been putting that information out there so people understand really well how much things should cost. That's the first part. And then the biggest thing that actually helps owners save money is just a simple concept, bids. You need to get Everyone knows in their head they should be getting three bids, four bids, five bids and that actually doesn't happen most of the time in the custom home building process. >> bid. >> Well, you know, so a lot of contractors will, and for good reasons, use their guys, right? But the then there's price, you know, kind of creep that comes up and so Build Angel is really about being the builder's rep for the homeowner. And you think that that's your general contractor. And generally speaking, they are trying to help build you a house. And building a house is hard. So, I don't I tell people they should they should use a a general contractor. Most people are not equipped to build their own home. >> Right. >> But that said, there's some there's some interesting things in the industry like cost plus pricing. We were talking about this earlier. The fact that every time you spend more, your general contractor makes more on your house. That's kind of bad alignment. We don't we don't love that. I But but that that's the way the industry works. And so, what you can do with that is if you use the right tools now, we use a lot of AI to help people understand costs, and then to to make sure they have competitive bids on all the trades in the house. And that literally saves 20 to 30% on average on a house. That's big money. That's Most people are spending now with >> custom home, you're saying I can maybe get done for 750 to 800. >> Easy. Like I That's a guarantee. That's not hard. Um it can be more. So, and there's just so much inefficiency in the system. There's everything from just inefficiency to kickbacks and straight fraud. And that's happening, and it's rampant. >> And mistakes. >> And mistakes. >> Billionaires. >> Yeah. So, uh there's just a lot of opportunity. And here, of course, in Utah, you we have a really great market because there's so much custom home building going on. But people now have tools, including ours, that they should be using. And if they do, you know, they're going to have a lot of equity in their home by the time they actually build it. And or get more things for their money, right? So, if you're building a $2 million home, someone like Build Angel comes in, and you're like, well, I'm going to my budget's $2 million. Most people are still going to spend the $2 million. The difference is you might get that sport court underneath your garage with a suspended slab or something like that. And we literally do this all the time. We get people more for their money. >> Yes. >> Yeah. So, if >> to our viewers and listeners, if you're building in a kind of any capacity, just check out Build Angel at buildangel.ai. This is not a commercial, but I'm just You're kind of come on here. I think this is disruptive and I I really want to encourage you. >> Yeah, I I mean >> We want to see it happen. >> I've talked to you about this before a year ago or more that I just can't went through the whole custom home building process. It was insane. I mean, shout out to my builder, he was great and he would did a great and phenomenal job and luckily we timed the market perfectly so that the price of my home has gone just up and up and up, but at the same time the process to do it, it was pretty crazy. >> It is always insane. It's a I've been my own general one time. It was a nightmare. >> Yeah, so we bring, you know, a lot of this experience that we talked about today, so my experience with marketplaces in particular. So we were creating a marketplace of really good subs >> Yeah. >> especially and contractors. So we help people pick their contractor and their subs that will give them a fair price and then also use all the methodologies to keep their costs reasonable. We're not talking about a race to the bottom here. We're not talking about crappy work. We're talking about the same quality or higher work for a fair competitive price, right? >> is also there's just mounds of data. A real custom home bid is going to be thick. It's going to be mounds of data, pricing, volume, if it's done right. And sometimes it's done schlocky, sometimes it's done really like professionally, but there's so much data the average home buyer or home owner that's having that built doesn't have the capacity, time, or inclination to go through all that and check prices. Your Your service is going to use the power of AI to do that grunt work, but still the contractor, Build Angel, and the homeowner building the home are going to be partners in using human judgment at the end of the day to do the right thing, but having that foundation of knowing Oh, this bid for cabinets is 40% more than I can get from other people in my market. Let's take a look at that. >> Is that kind of the what we're looking at? >> Absolutely. And yeah, the the comparison of bids is really important and we with you know, our AI and systems now are trying to make those bids apples-to-apples so you can understand them cuz there's a lot of differences in materials and workmanship and all of that. And so, yes, we try to make it easy for the >> is this 30% cheaper? Oh, it's inferior material. >> Yeah, yeah, it's plastic. >> But, oh, this one's 20% less than the other bid, but it's the same material. That's the kind of thing, yeah. >> So, this is awesome. We encourage you I just want to say, please go make it happen and be successful. This is going to be awesome. >> it's kind of funny. All of your stuff has a very similar vein theme throughout your whole career. Why why is that? And you just feel like like this distributed way >> fix big problems. >> Yeah, I like I I do get irritated when I see inefficiencies or um things that are in a market that don't seem fair. >> Yeah. >> like so I you know, I'm up in Alpine, we got a lot of houses going in up there, and a lot of my neighbors were complaining for years that are like, "Oh, yeah, I did my I did this house, I spent like 4 million. I thought I was going to spend 3 million." And it's 18 months instead of 12 months. >> you gave your example of 2 million, I was going, "I thought you were going to say, yeah, my budget was 2 million, but it mushroomed to 2.4." Yeah. >> Yeah, so I mean, we we'd like to help fix and bring efficiencies to this market. I'm frankly I'm I'm surprised in 2026 when you get done building your house now. Most people don't have they don't have a digital twin of their home. They don't have records of all the stuff that went on. They can't talk to their uh large language model or AI, right, and say, "Hey, uh who worked on my who did my the who did the plumbing? Uh what's the color of paint in my master bedroom?" That's the kind of stuff that you would expect in 2026. So, we do that, and it seems like a no-brainer. And then we're going to so, we're really going to help, you know, homeowners build houses and and not waste their money and >> Tyler's got one last question for you. Before you do, I just want to say, okay, let's check back in with you in the future on this podcast, and let's see I would expect to see the average home custom home built over the last year, you know, went up 20% above the owner's budget, but Build Angel homes went 20% below the budget. If you do that, you will change the world. >> going to do it. So, >> Okay. >> anyone building a home should pay attention. >> Okay. That's going to [clears throat] be awesome. >> Okay. So, we always ask to end the podcast episode all of our guests the final question, which is if you not that you could go back to when you're 20 years old or, you know, do it something over, but if you could leave all of these viewers and listeners with one piece of advice, whatever it is, whatever you've learned, like what are you telling them? >> I'm going to tell them you won't remember the money. Experiences are everything. >> Yeah. >> You know, if you think back to some of the cool things you've done, you can't even remember how much they cost or, you know, if you spent money on on doing something special or helping somebody or anything like that. The money is like irrelevant. So, people have these dollar things in their head. Like as you get older, you just realize money is just a medium of exchange. And what you should be exchanging that for anytime you can are experiences, yeah, good experiences. >> Very good advice. >> I love that advice. Okay, Morgan, thank you so much for coming on the podcast. We really appreciate it. >> Yeah, it has been amazing and >> Thanks. >> thank you so much to you guys listening, tuning in. Reach out to Morgan. Go build your home through Build Angel. Go go talk go follow Morgan on LinkedIn. I'm sure he's on all the social media sites. Go hit him up and and just become his friend. He's a really really nice genuine guy and a great friend of the podcast, great friend of Startup Ignition and of course dating John all the way back to 25 years ago. >> that. I feel bad I dated him so much. >> Okay, I guess [laughter] 24 years ago. But, okay, thank you for watching. This is it for this episode of the Startup Ignition podcast. Like, comment, subscribe, follow, and tune in for the for the next episode. We have a great one coming after Morgan as well. So, stay tuned. Thank you so much.