TSP017 | Charles Smith – Transcription

Posted by John Livesay in Uncategorized | 0 comments

John Livesay:
Welcome to The Successful Pitch podcast. Today’s guest is Charles Smith who works at Social Starts, which is both an investor in seed round as well as series A and Charles talks to us about the different criteria and the different amount of money that they invest and how they decided. Charles said that the culture of a company beats the scheme every time. He talks about one of the companies they started as one of their first investors called Boxed, which is basically Costco for the mobile app and the CEO of that company is so successful now that they are paying for their employee’s students to go to college, which is obviously generating tremendous amount of publicity and a huge success story.

Charles talks about how important it is to find out other people who have pitched him and what questions he’s going to ask before you come to see him. Great intel. He really wants to know why this idea is great, how it’s going to change the world, why you’re passionate, and most importantly, why you’re the right person to make it happen. Enjoy the interview.

Hi and welcome to The Successful Pitch podcast. Today’s guest is Charles Smith who is working Social Starts. He was just named one of the top 25 angel investors in New York to know, so you can imagine how excited we are to get to know him on the show today. Welcome, Charles.

Charles Smith:
Thank you, John. I’m excited to be here.

John:
Would you tell us a little bit about Social Starts and then maybe backup and tell us how you got into the whole startup world in the first place.

Charles:
Oh, sure. Social Starts is a seed stage investment fund. It also has an A round fund, so we have a very interesting approach to the world. We have over 160 investments spread out over four years who very active fund and we really like to be the first money in to a company and then we also always reserve pro rata so that we can invest out of our series A funds. So, we look at those as two separate stages in a company, obviously, but we’re very particular about what we want to see when a company raises series A, so those criteria are very different going to seed to series A. The way we look at the world is the internet has enabled trust over distance at scale for the first time in human history.

John:
I love that. We’re going to Tweet that out. Trust over distance.

Charles:
Yep. So, our general part is a man called Bill Loshe, coined that phrase, or at least I credit him with coining it, and so we look at things that are right in that vein. Like, what does trust over distance enable? It enables media to happen, it enables social networks to happen, it enables you to make friends and have those friends tell you about things over distance and so that’s where we look. So, if you look at our portfolio, it is a lot of examples of social analytic platforms, marketing analytic platforms, media platforms. We do a lot of mobile commerce and we’re looking at the software of the internet of things as well. So, those are the ideas in which we do a lot of investing.

John:
Fantastic. Can you give us a range. I know the article said you typically go between $25,000-50,000 with the startup seeds, is that what Social Starts does?

Charles:
Sure, so Social Starts actually, that was my angel investing statistics, when Social Starts looks at $50,000-100,000 to invest in what we call a motive of inception investing and then our series A fund invests $250,000.

John:
Got it. Wonderful. Alright and very different criteria.

Charles:
Very different criteria.

John:
Would you mind walking us through really quickly what’s the criteria, was it moment of inception?

Charles:
Moment of inception. You know, we look at the moment of inception fund, we really look hard at the SEO and whether or not they are going to be able to get the company through the hurdles that all companies face and we have the process where we want to meet with those CEOS at least twice with two different partners in person and spend time challenging them, not only about the company and the way the company is structured, but as a person, because there is a, there’s so many points of inflection happen in a startup. Paul Graham coined a phrase, “the trough of sorrow.”

So, how is that CEO going to deal with that? How are they going to deal with the fact that at some point you’re not going to know everybody who’s in the room very well. How are we going to deal with the fact that when you’re 100 people and you have to manage a board of directors and a group of investors and a group of customers, because they are very different skills growing from a company that has 2-3 co-founders in a room as oppose to growing it to 200 people. So, those are the kinds of things we try to get to.

So, we’re very interesting in CEO’s backgrounds. We’re very interested in what they’ve done in the past. We’re very interested in why they’re doing this particular idea and what makes it a great idea from their perspective and then we also analyze, is the market big enough, if there are metrics on the company. We do fund businesses that aren’t necessarily launched.

So, we get to do projections there, but if there are statistics, how is that going? Do we think the market is as big as the company says it is? Are they creating a market? What hurdles do they face there? One very important thing too, we fundamentally believe that technological skill is what enables you to beat your competition and so we don’t invest in companies that don’t have that skill in house. That’s important to us.

John:
In other words, they’re not outsourcing it. They are still looking for somebody, they have to have that person on board and somehow either that person is working for equity and no money at this point, if there’s no revenue or however they find that person.

Charles:
However they find that person and that we want to be able to evaluate that CTO as well.

John:
Let’s just tap into a little bit of the trough of sorrow, because it is fairly familiar to most people, but since you brought it up as a key criteria, you know, that trough of sorrow can last a week, sometimes I’ve heard it last some people a year and it really is this whole concept of what am I doing, not just what you mentioned of, which is also overwhelming of I don’t know everybody or the skill sets are totally changed or I don’t know, it becomes this whole self-doubt issue, so I would imagine when you’re evaluating people that you look to have them share some experiences of when they’ve been down or had a hurdle and how they’ve come back from it. Would that be an accurate assumption?

Charles:
Absolutely. You want to talk about ways that they’ve, you know, challenged themselves in the past and how they’ve come through those challenges and that, one of the things about funds often wanting to and, we’re no different, wanting to invest in previous entrepreneurs is they’ve dealt with a lot of those issues, even if they fail previously. If they’re willing to go ahead and do it again, knowing ow hard it is and knowing the issues they face, well, that’s something that is very important to understand.

On the other side of that, we also wants to see the passion an entrepreneur has for his or her business, because if they don’t think that it’s the greatest idea ever and that they are there to change the world, well, then, we’re not going to be able to convince of that, right? So, the first and most important thing is that, is they believe their idea is going to change the world in whichever world they happen to be in whether ti’s human resources or anonymous chat, whatever.

John:
Right. I read about your article about being one of the top 25 angel investors to know that changing the world is a very, very personal motto for yourself and it’s not just about finding the right entrepreneur or making a lot of money, it really is about changing the world. Can you give us some examples of startups that you feel are changing the world and why you’ve invested in them?

Charles:
Sure. Well, there’s a couple of examples from my personal portfolio and it doesn’t, changing the world is an interesting thing, right. Well, I’ll give you a great example from our Social Starts portfolio. We just invested in a company called Style Lend and Style Lend is a business which allows, mostly women, to share their closet. So, they buy a dress and, you know, it costs, say it costs $200. Well, they wear it once and they can rent it out three or four times and then they wear it again.

So, they amortize the cost of the dress out through a network and this is a perfect example of this trust over distance and the way it changes the world is well, there’s a whole lot of clothes made that only get worn once and then thrown away and a woman is unsatisfied with what she purchased. Well, here’s a way to build a relationship with someone. You understand the sizing parameters are that you’re getting. You understand what it’s going to look like on you, because you created a relationship with this person. Maybe you can rent the same dresses from women again and again, different dresses.

Look, is that changing the world in a grand scheme of things? No, but it has a huge impact on women’s lives, women love it. It’s launched in the San Francisco area. It has great reputation among its customers and has an opportunity to really change the way you think about buying clothes and then wearing them.

John:
I really like that. You can see why you invested in that, because you were a VP at Etsy. Am I pronouncing that right?

Charles:
Etsy, yes. You are pronouncing it right.

John:
Where people shop from all around the world, so you have a knowledge and expertise in the shopping arena and certainty if you found someone who is your size and that dress fit you perfectly, you’d love to probably rent multiple dresses from that same person.

Charles:
Yes, absolutely. You almost become closet buddies, right. That’s a big deal.

John:
Yeah, that’s a great example. Let’s jump to what the criteria is because it is so different for social starts series A. What are you looking for there? Are you looking for revenue to be happening? How many people need to be on a team? That kind of thing.

Charles:
We are looking for..in moment of inception fund, we will act as a lead syndicator for an investment. In series A, we will not do a lead. We are a small fund. We have three active venture partners, two general partners, general partners above the venture partners, so only ten people in the fund overall, so we can’t do significant due diligence for series A. So, we’re looking for a venture capital lead on series A that we can follow. So, that’s the biggest criteria right there. It’s got to be a venture capital lead.

Now, other things that are involved there. Again, it’s often companies that are already in portfolio for which we are investing pro rata and, you know, it’s going to be obviously also in our areas of expertise, so that’s what we look for. So, different series A depending on the type of business can have very different criteria for whether or not you’re willing to fund a series A. You know, big time gaming businesses will often times raise a series A before launching a product, because the depth and the complexity of the technology so hard or you have a consumer business.

Well, you better be doing to raise a series A, you better be on a run rate to doing at least a million dollars a year with significant customer growth and customers you can go talk to. So, the criteria really depends on the area of focus for the business.

John:
Is there someone that you can give us as an example that’s public knowledge that started off as a seed and because you knew them so well, they’re one of the few people, while they weren’t, you weren’t their lead series A, oh yes, you’ve got series A, somebody else’s lead, now we know you, we’re happy to be..

Charles:
Sure. I think the best example in that category is Boxed. Boxed is a mobile shopping application, only on mobile, and it sells bulk items via mobile commerce and the founding team we got to know very early. I believe we were the first, that deal was done before I was at Social Starts, but I believe we were the first money into the company and then we followed on two rounds, I believe, after that and that’s just a great company, growing phenomenally and we’re very proud of that company as an investment and as a company. The CEO just announced that he’s going to contribute towards the college education of the children of his employees.

John:
I just read that today. That is so timely. Yes, because they compared him to the mobile Costco, right?

Charles:
Yes, exactly. Mobile Costco, yes, that’s what they would say.

John:
When I was reading about his willingness and some of the employees are making $70,000 and that company, if you qualify, is still willing to pay for your child’s college eduction, because he believes in education so much.

Charles:
Yes, that’s exactly right. Yep.

John:
What a smart marketing move as well as talking about changing the world in a small way. If you set that example of I’m a startup, this is what I’ve done and once I get to this level of success, I’m going to start making it so desirable to work here that I’m going to put my money where my beliefs are, which is I believe education is the key, as you said, tech skills beat the competition every time. Imagine him trying to attract some really smart tech people.

Charles:
Oh and I, you know, I’m a big Philadelphia Eagles football fan and the coach of the Eagles says, you know, culture beats scheme, right, and so, that’s another theme. If you’re growing a big business, you’re going to have to create a culture that allows you to grow. People define great culture as very different things and that’s something that I don’t even, that’s very difficult to define, but you know it when you’re in it and you know the company, the people in the company are committed to making a company grow.

John:
We’re going to Tweet that out. Culture beats scheme. When it’s true with sports and it’s true in your business and it really defines your culture in a way that’s just not a philosophical difference, but an actual way of treating people, you don’t have to be as big as Google, obviously, to treat people well, right?

Charles:
That’s right. That’s exactly right.

John:
What an inspiration your company picked someone of that caliber. I’m constantly talking to my clients about the importance of integrity, character, and trust, and honestly and not hiding things, because it will all come out in due diligence, but you know, tap into someone who A) has a great idea and the skill to do it, but then almost surprising you with that kind of decision that they’re going to pay for their employee’s student children college educations. It must be so rewarding to say, boy, we really bet on the right horse. The right jockey, excuse me.

Charles:
We – tons of emails around the Social Starts group today, you know, patting ourselves on the back for that kind of great decision. It feels wonderful.

John:
So, let’s talk a little bit about you and your background, because you have a really interesting background. As I mentioned, VP of Etsy and also working in this Ineo Group, did I pronounce that right?

Charles:
That was my consulting arm.

John:
You know, what caused you to want to get involved in being an investor?

Charles:
You know, if you start at the beginning of my career, my family owns a media business called Calkins Media. It’s small news papers and TV stations outside of Philadelphia, outside Pittsburgh and then the South East and I started my career at Macy’s and I grew very frustrated because I grew up in an ownership situation so I thought like an owner and after about five years at Macy’s I realized this is – I still think like an owner and that thinking is not valued in a large corporation and owners take risks, owners take responsibility, owners want to, you know, impart change on their companies as often as they can if it’s the right thing to do and so I got very interested at that point.

And that was 94-95 and the internet was just starting to happen and I thought, okay, well, I’m going to figure out hot to do that and so aggressively look for a way to get involved in an internet business and so being involved in that startup world in New York eventually lead me to investing and I find the idea of trying to understand how a company can overcome its obstacles and putting your own mind to work as that company tries to over come those obstacles was a fascinating way and not always a smart thing to do, but it’s a fascinating way to sort of put the ideas of your principles to work towards the company’s success, so I really loved doing that.

John:
That’s great, those three principles – being comfortable with risk, taking responsibility, and being comfortable with change and not just liking the status quo, which is what so much of corporate America is. It’s like it’s always work, let’s just try to make it work a little bit better, let’s not change everything or don’t be an agent of change, please.

Charles:
Yeah, exactly.

John:
You must hear a lot of pitches both at the seed level and series A, maybe not as many, but still quite as few. What are some of your big suggestions to people who pitch you or anybody on how to make it memorable and effective?

Charles:
I think the first thing you have to do is let go, as an entrepreneur, let go of the idea that that you’re controlling the pitch and understand that every investor is going to want to get different things out of the pitch and be prepared to respond in the way that the investor wants that information given and the better you know your business – if you know your business very well, you’re going to be able to answer the question in anyway that they’re offered.

John:
So, they could interrupt you during the pitch, you don’t have to finish the pitch to – or you could get asked after the pitch, it’s the ability to pivot while pitching, basically.

Charles:
Exactly and often the exercise of a pitch meeting really does test how you’re going to respond under pressure in a very small way and so I think that, you know, being prepared not to pitch, but being prepared to understand what the investor is trying to get out of you and having information as background and I think to that end, I’m always surprised entrepreneurs don’t spend more time networking amongst themselves. They do a lot of networking amongst themselves, but they really should take the step and say, okay, Charles invested in you, what’s it like to pitch him?

John:
Yes, do that homework, yep.

Charles:
Do the homework and not necessarily about like, I’m much less interested if they did a homework about my background then if they understand what it means to pitch me, you know, you can talk to two to three people pretty easily in my portfolio and say hey, what’s it like to pitch Charles? What is he looking for and then they’re not surprised and are able to, you know, that entrepreneur, he or she and I are able to have a better conversation.

John:
Because automatically they know A) you have to have the tech skills in house, right, something basic like that and they’re going o get asked that and also they want, you know, passion, you mentioned, is very important to do you so you better know the answers towards why you’re doing this and what makes this a great idea and what makes your team the right ones to execute it, right, some basic prepared answers to those questions.

Charles:
You said something there that I think is something that’s really important and you said it in a broader sense, but the real question you have to answer as an entrepreneur is why am I the person to do this.

John:
Yes.

Charles:
Because there are no new ideas, right. There are very few new ideas, so what makes a different is why the entrepreneur can execute this idea versus everybody else and part of that is a team and part of that is different strategies, but especially I advise companies as well occasionally and I’m always telling them that. You have to answer why you’re the best person to do this.

John:
It’s so important and you have to believe in yourself and you have to ideally have some kind of story that shows why you’re the best person and not just think it, right?

Charles:
That’s right.

John:
Well, since you’re such a specialist in mobile and shopping and all the other data things that you mentioned, mobile commerce in particular, are there any trends that you’re especially excited about?

Charles:
I think the interesting thing right now that’s going on and it really is sort of applying – I sort of back it up and say what I’m really an expert in is media, but what’s happening the world now is analytic systems and publishing systems are merging in such a way that delivering content based on analytics becomes, it doesn’t matter if you’re a commerce site or a media site, you’re going to be gathering information from various different sources whether it’s social media analytics, the analytics of what’s going on in your website, who is viewing your traffic, those things, what people purchased before, what ads they’ve seen before and delivering them an experience that’s based on an analytical framework.

So, the difference between, you know, serving up a dress and serving it up an article about children’s books are basically – it’s the same thing, it’s just a different type of content, so the trends we’re really seeing are and Boxed is a phenomenal example of a company that is laser focused on analytics and making sure that the items that they’re delivering to the customer are in line with what the customer has purchased before, what they want to see, what customer like them to see, right, which is, if you think about it, that’s what Buzzfeed does, right? They do the same thing and in very different ways, I’m not comparing them, in a lot of ways obviously they are apples and oranges, but that core analytic, you know, analytic and delivery framework comes from the same place.

John:
If you like this kind of article on Buzzfeed, we’re going to give you more of that. If you like this kind of garbage can, we’re going to show you more of those or where they really get smart with analytic is, seems like you might be running out of the filler for your garbage cans right about now, so serving you up an ad for that or content or story about it or something.

Charles:
And also I think the other thing that I think is going to change dramatically and this is different from in Commerce as oppose to media is what I call merchandising and what, which is very hard to do on the internet and stores do it very well. It’s very easy to see how this shirt goes with this pair of pants or hey, you need a wallet or you need a belt to match your shoes. There’s a key fashion tip right there. So, how are you merchandising? How are you suggesting other items?

And I think more and more analytics will go towards that so that, because look, there are two ways to raise your revenue as a retailer, as a commerce merchant. You can add more customers, right, or you can get the customers you already have to buy more and almost always easier to get the customer you already have to buy more because you don’t have to pay to acquire them again.

John:
Absolutely.

Charles:
And so, driving towards analytics is about how you raise that check size. How you raise that average check is really critical as a piece of analytics.

John:
What I’m seeing is, you know, the more you reward people for spending more with you, whether it’s an airline mile frequent flyer thing, being a frequent flyer on Boxed and getting more of a discount, people love that, because they’re like, oh, well, I wasn’t thinking of buying this with you, but if you’re going to give me a bigger discount on everything I’m buying, then why wouldn’t I buy it from you?

Charles:
Absolutely.

John:
That kind of strategy. Charles, what are some books that you like and it can be related to investing or they can be related to anything that you find useful about living a more successful, happy life?

Charles:
I often, when entrepreneurs ask me that question I tell them, I ask them typically like, you probably read TechCrunch everyday, you are overwhelmed in the amount of reading that you get in terms of magazine articles, etcetera. So, I often recommend that they do what I call mental floss reading and that’s a term from Brad Feld, who is a great and well-known investor out in the Foundry Group in Boulder, Colorado and that’s his – I’m borrowing that term from him.

So, take some time, do some mental floss, find an article. I love Neal Stephenson. He has a new book out. He is a great both computer programmer, he writes a lot about the internet age and also about science fiction and he’s books are like super technical. He has a great way of combining very technical subjects with great adventure. So, that’s an author I like to recommend to people if entrepreneurs haven’t heard of it, because it’s at high levels, but it’s not about what they’re doing.

John:
So, it will stimulate you while still giving you the mental floss. Fantastic. Is there anything else before we close that you want to say to the listeners? I mean, you’ve given us so many great takeaways about tech skills beats the competition, culture beats scheme, you know, getting over the trough of sorrow, all these great, incredible takeaways, is there anything else that comes to mind on being prepared for the pitch? As you said, talk to other people who have pitched me to see what I like to hear?

Charles:
You know, I think that, you know, at its core, pitching and trying to raise money is often dreaded by entrepreneurs and I think that if you look at it as a way to gather a very broad swath of advice from very smart people who have seen and done a lot of this before, you can change your thinking about your fund raising and managing a big company, managing a small company is all about managing the inputs.

John:
Love it.

Charles:
You’re going to get all kinds of advice, you’re going to get all kinds of information. So, the fund raising practice is really great practice for taking all those inputs when you’re running the company as well and so really look at it as a way to get information because you’re going to get conflicting advice. One entrepreneur is going to, excuse me, one investor is going to say wow, you should really go after the doll market, another investor is going to say, wow, you should really go after the athletic shoe market. Well, you have to understand what’s important and how to make use of all that different advice.

John:
I love that. Managing all the disparate input and looking at pitching and getting advice as a welcome experience as oppose to something to dread. Fantastic. What is the best way for our listeners to stay in touch with you? Blog, Twitter, LinkedIn?

Charles:
You can follow me on Twitter. My Twitter handle is CharlesSmithC. I’m always happy to receive inbound pitches, although a warm intro is always better, you know, if you know someone who knows me, I rather hear from you that way, but also nothing ventured, nothing gained, so if you don’t have a warm intro, my email address is Charles(at) SocialStarts.com, fire away and I’ll invariably respond, because I think if you’ve gone to the effort to reach out to me, then I don’t have so much volume that I don’t have the time to respond, whether or not I might not take the meeting, you know, I’m not going to take every meeting, but I’ll try to respond.

John:
How great. Well, I can see why you got voted one of the top 25 angel investors to know in New York. I would say you are one of the 25 people to know period, no matter where you are.

Charles:
Well, thank you. It’s been great talking to you. I really enjoyed it.

John:
My pleasure, thanks again for joining us.

TSP016 | Scott Eddy –Transcription

Posted by John Livesay in Uncategorized | 0 comments

John Livesay:
On today’s show, The Successful Pitch podcast, we have Scott Eddy who is a social media influencer. In fact, he was named by Klout one of the top ten global travel influencers out of 74,000 people. He is also the Global Brand Ambassador for a new startup Zipkick. Scott talks about how important ROI is in social media and that the R in ROI really stands for relationship. He talks about how to have 608,000 followers like he does on Twitter by having the right voice that’s consistent and non-stop.

Whenever he travels and he’s traveled around the world and lived in several different countries like the Philippines and Spain and Thailand, he said, I chase the conversation, not the big names and that is a key takeaway from today’s interview where he said, Twitter allows you to follow not just what your competition is doing, but what the conversations are that they’re having and that allows you to make strategic decisions to get you funded fast. Enjoy the interview.

Hi and welcome back to The Successful Pitch podcast. Today’s guest is Scott Eddy who is a social media influencer, so much so that Klout named him one of the top ten global travel influencers out of 74,000 people that they measure. Scott as an amazing following on Twitter alone of 608,000 followers. Can you imagine that? And he’s only been on Twitter since 2009, so that’s quite an impressive growth pattern that he’s going to share with us today. Scott, welcome to the show.

Scott Eddy:
Thanks, good to be here.

John:
Scott, you are quite the man of the world. You have literally lived in Thailand, Spain, UK, Philippines, and Portugal and, of course, now the US. Tell us about how you went from being a stock broker to a digital nomad and such a social media influencer.

Scott:
Well, my path here hasn’t been normal at all. I was born in Michigan, but I was raised in Fort Lauderdale and my father was a Fort Lauderdale police officer. So, you know, how I grew up in my mind, my whole life was mapped out. I finished highschool, I join the police academy, I become a police officer, get married, have the two and half kids, and, you know, retired.

My life was literally all mapped out. So, that all came to an abrupt end three weeks before I graduated highschool, my father was killed in the line of duty and it sort of turned my life upside down and I had no idea what I wanted to do and long story, very, very short, about six months later I ended up going to an orientation for an investment banking firm and, you know, I got accepted in the training program. I was a stock broker for ten years.

In my opinion, and I try to look for the silver lining in everything that I do and if all of that wouldn’t have happened, then I wouldn’t be where I am today and as much as I would give up everything that I had and everything that’s in the future just to have five more minutes with my father, you know, I’m grateful for one thing. When I was a stock broker, I learned the most essential skill that you can possibly learn and that’s sales, because it doesn’t matter what industry you’re in anywhere in the world, sales is definitely the most important tool that you have. So, in combination of my sales skills and being raised in an insanely strict household, you know, I was literally thrown to a wall if I didn’t say yes, ma’am and yes, sir. I think that molded me the way that I am today.

John:
What did you learn – what are some of the things in selling from being a stock broker, because obviously the people who listen to The Successful Pitch realize they have to sell themselves and their ideas to investors. What are some of your favorite takeaways on what makes a good sales person?

Scott:
You know, I learned the most aggressive type of selling that you can possibly learn. I sold stocks over the phone to generally people in the beginning of the call that didn’t necessarily want it or you had to convince, you know, it was a very, very hard sale. I liked that because I learned the most aggressive part now, I can just let off on the accelerator anytime you want. I think you have to be very genuine. I think you have to believe in whatever product or company or idea that you’re pitching. If you’re not, I think it’s apparent. I think people can tell that you’re not genuine, that it’s not something that’s real and tangible and something that’s going to follow through with everything that you’re saying it will.

John:
One of the things that you have on your homepage on your Twitter is storytelling is the key to success, which of course, I love because that’s my favorite part of pitching is storytelling. Can you give us some examples of where you’ve used a story to create success for you and who you’re working with?

Scott:
You know, I use storytelling as part of an everyday part of my life, you know, partly because of social media, but partly because I don’t think just saying what’s on your mind works anymore. Whether you’re pitching, whether you’re selling, whether – I think everybody needs a little bit of story just for clarity, just to paint the proper picture.

So, I think being a storyteller – it’s funny because when I was growing up and I’m sure when you were growing up, being a storyteller, that means you were a liar and it’s so amazing that today it’s one of the most integral parts of business that it’s unbelievable how the whole world shifts, how a term can just, again, be turned upside down and mean something completely different in ten years, in 15 years, but it’s a very important part of the startup world for any entrepreneur out there. It’s an necessary skill that I think even if you don’t have it, you need to practice it. You need to go to friends and family and say, give me 90 seconds. Let me try and explain this to you and then you tell me what kind of picture did I paint. You know, something like that.

John:
That’s great. I knew we were going to get a lot of tweetable moments from your episode, if you don’t have the skills to be a storyteller, practice it. That’s definitely a tweetable and what I really love is storytelling used to mean you are a liar ten years ago and now it means you have a compelling way to express your ideas in an authentic way that people see your passion and make it memorable.

Scott:
That might be more than a 140 characters.

John:
Yes, I’m sure it is. Well, I’ll let my experts edit that out, but it’s definitely a takeaway in the show notes, for sure. Everyone I’m sure is really curious, I don’t want to tease them anymore, tell us how did you get 608.000 followers on Twitter, because no matter what business you’re in, social media and getting a following and getting word of mouth is key to success and growth.

Scott:
Yeah, so, you know, again, I have an insatiable desire for developing relationships. It might sound weird coming from my background as a stock broker and an entrepreneur that I have lots of success and failures, money means absolutely zero to me, because I’ve lost everything I’ve had twice just because I go all in on everything that I actually do.

So, for me, it’s all about the relationships that I have and my global network, you know. I just love dropping down into a new country where I know one person or zero and just building up a whole new network and the only way you can really do that is on social media. I mean, you get out there and you find out who’s having a conversations and I chase those conversations. I don’t chase the big names.

You know, if I find out who’s the most active people, just like when I came to San Francisco, I came here in mid January and before I got here, a couple of weeks before, I’ve been to San Francisco a couple of times, maybe 15 years ago, but I haven’t been down here since social media took off, so I found out who were the active brand here, who were the active online magazines, who were the active individuals. What conversations are they having? Do they follow back? Do they talk back? Do they retweet? Do they share? These are the people that I’m getting into bed with, so to speak. These are the people that I’m following. I don’t care about the big names and the white check next to your name, your verified account. I could care less if you’re a celebrity. I want to know are you human on social media. Do you talk, do you have conversations.

John:
I love it. Chase the conversation, not the big names. That’s a tweetable moment, for sure. So, this leads us to another great story, which is Zipkick found you on Twitter. Tell us how they found you and what Zipkick is.

Scott:
So, for the past, like you said, I have been on Twitter since 2009, but I really haven’t been active. I did what everybody else does. I setup a Twitter account. I tweeted a couple of times and said, this is just a Facebook status update over and over again. I don’t understand it and I’m leaving it. So, I went away for probably a year and a half. I really didn’t get super active on Twitter until probably to mid to end 2010. So, I really have only been active on Twitter for maybe three and a half years, maybe four years at the most, but you know, I realize that it was a platform.

This is where the conversations take place. 94% of the accounts on Twitter are non-private, so they’re completely open to the public. So, if I’m starting someone that’s going to rival Burger King. I can go on McDonald’s, Wendy’s, you know, any of the competitors. I can see how they’re marketing, who they’re talking to, what are their conversations. There’s no industry, there’s nos platform in the world where you can go on and see the conversations of your competitors so out in the open like you can on Twitter. It just blows my mind. It’s amazing how everybody doesn’t take advantage of this.

John:
I think that’s such an important point, Scott, because when you’re crafting a pitch deck for investors, one of the key slides is who is your competition.

Scott:
Exactly.

John:
And to do that research on Twitter is a no brainier as you just described it, but I don’t think a lot of people think to do it, so that’s a huge takeaway.

Scott:
Not only who are my competitors, what are they talking about. How active are they on social media. Like, you can get so, you can get the stats can just be mind blowing.

John:
Right.

Scott:
They can really blow you away, so yeah, okay. I built up my following just because I’m aggressive, following the right people and they follow back and I conversate and people can actually see, hopefully, that I am human and that I have etiquette, I have manners, and this and that. That goes along way in social media, because a lot of people don’t.

John:
Let me just point something out, which I think is so fascinating, which is, your childhood of being raised by a police officer where manners were so important in the home has now – a key success to you getting 608,000 followers on Twitter because of your manners. I love that so much and I love that you’ve learned that from your father, so in a way, his legacy is living on through you in Twitter.

Scott:
Yeah. I mean, for me, it’s very important, you know? I mean, let me tell you. I don’t really throw people under the bus on social media. I would rather not talk about you than give you, you know, because bad press is still good press, so I rather just not give you any press rather than throw you under the bus. I could have six million followers if I just sat down and crushing everybody all day on Twitter, because people like that. There’s a certain aspect. I would much rather have 600,000 of the right crowd, the right mentality, people that, you know, I like conversation rather than six million of and just being negative all the time. I wouldn’t trade it for the world.

So, getting back to the story, for the past three years, 100% of the opportunities that I’ve taken advantage of have found me on Twitter or through Twitter and then contacted me. So, Zipkick is no different. So, mid January the co-founder, Jason, who you’ve met.

John:
Yes, great guy.

Scott:
He found me on Twitter and asked me a question. We went back and forth a couple of times. I really like to, when I meet somebody that I click with right away, I like to translate that into a Skype call as soon as possible. Within a few hours we hoped on Skype and we had a conversations and, you know, at first they just wanted me to be beta tester for his app and it quickly jumped and he said, look, why don’t I bring you out here and you be our global brand ambassador. Long story short, 12 days later, I was on a flight to San Francisco and I’m still here.

What Zipkick is, it’s a travel booking app. If you think Expedia or Kayak, you know, they give you 4,500 results and there’s all kinds of advertises and check boxes and scroll bars. Think Expedia, but also think Google and Facebook and if they all had sex [cuts out]. Okay, the baby would be Zipkick and what I mean by that is this, it’s a simplified travel search, travel booking app that’s starting out with hotels and then moving into flights later, but we give you five highly personalized results and nobody has given you the personalized service that you need.

You know, Facebook gives you a personalized timeline. Everybody is going down the personalization route, the travel industry is still stuck 25 years. They’ve been using the same model, same search techniques. Everybody comes out, you know, there’s a new site, there’s a new this, there’s a new that, but it’s all the same business model. It’s all the same search. You know, why not personalize something for you, John, or for me, Scott, or for somebody else. Everybody’s search preferences is going to be the same, but yet, if we all go on Expedia right now and look for a hotel in LA for certain – for specific dates, we’re all going to get the same results.

John:
It’s a fascinating model, that’s for sure. I know investors love to invest in their team. That’s their number one criteria, even more than the idea. They like to say, we invest in the jockey, not the horse, so having you as part of the jockey and the team for Zipkick is really quite clever on Jason’s part, because you are the secret weapon, the secret sauce because of all the followers you have on Twitter, eliminates a need for a huge marketing budget, because now when you’re tweeting something out about Zipkick, you have people who are travel enthusiasts who are going to be these early adopters to use it and I think that’s really a great example of what makes you and Jason and Zipkick so smart to getting investors to jump on board.

Scott:
I got news for you. The real secret weapon in this whole process. I may be in the spotlight because of my following and my influence and my association with all the travel bloggers all over the world, but Jason is the real key to the driving force behind this thing. I mean, he is such a genius when it comes to this area and what I mean by that is this, I can’t think of any startup in the world that has ever used an influencer to replace a marketing budget.

I mean, think about this. If you have an app that’s coming out. I don’t care what sector it’s in, the most important thing when you raise money is for technical resources. To make the app as good of a user experience as absolutely possible. You gotta hire the best of the best of the best to have them on your team, because then you’re going to have the best app possible, but typically, how much of the money that you raise is dedicated to getting in front of eyeballs and marketing budgets and things like that. Anywhere from 20% all the way up to 70%

John:
Yes and you hope it resonates and some of that money, the ads may never get clicked on as oppose to you – so the new trend in advertising is native advertising, which is making it authentic from a blogger, for example, but you already have all that creditability with these early adopters, so it’s really smart.

Scott:
Myself and Jason, but definitely Jason, but myself and Jason are definitely a deadly combination when it comes to his mindset, his strategic planning, his, I mean, his way of thinking, we just resonate so well together with everything that we do, both in business and personal life. So, I mean, it just makes for a person marriage, so to speak.

John:
Well, it’s interesting that you use that analogy, because investors tell me time and time again they look for not only who is on the team and what their background is, but how well does the team get along, because it is like a marriage and they said the average marriage lasts 7.2 years and when they are investing with startups, they typically goes for ten years. So, it’s very important that they see you get along well and have a rapport and have the skills to deal with bumps that come along the road.

Scott:
Yeah, it’s just a really, really good thing. Plus, they have a patent pending surrounding the algorithm that gets the search. I mean, the whole business model of Zipkick, it’s just going to explode.

John:
We would know because you are certainty have your finger on the pulse of the travel zeitgeist from living in all these other countries and engaging wherever you are. Recently I read about KLM using social media for booking flights and being a source of revenue. They actually have people dedicated within KLM to engage with people on social media, to deal with things like customer service almost, and then from there when they couldn’t get through any other way, when problems were happening, some people were trying to book connecting flights through social media. What are your thoughts on brands using social media beyond just the typical use of it?

Scott:
Well, you know, thank God 2015 came along, because these travel brands are finally starting to get it. I saw that article. I think it was – because I tweeted it, I think it was, they have a direct correlation of $25 million dollars a year directly comes from their engagement on social media affects their bottom line, which is what I’ve been preaching for the past three years when I’ve been working with all these travel brands.

They don’t understand, you know, some of them get it, but the majority of them are still dinosaurs as far as the mindset is concerned. They just don’t understand that the ROI doesn’t come in five minutes. It all starts with a conversation. You have to be human. You gotta get out of the brand mentality and you have to have the right brand personality, the right voice on social media. You gotta be consistent and you gotta have no stop conversations. Some of those conversations will turn into ROI. I always say the R in ROI definitely stands for relationships.

John:
Oh, I love that. Can we tweet that out please? The R in ROI is relationship. Oh, that’s great. Really great. Having the right voice and getting away from being a brand and being a real person and be consistent and non-stop, that certainty seems to be the formula for your success in having so many hundreds of thousands of followers and it takes dedication and passion. You can’t fake it. You said earlier the key to being successful in sales is being genuine and having a strong belief in what you’re doing and people can feel that even in a tweet.

Scott:
100%. You know, I’m completely transparent and authentic with all my tweets and posts and videos. I mean, if anybody ears me on a podcast or sees me on a video or meets me in real life, they’re like, wow, you really are the same. It’s the first thing I hear, all the time, and I’m like, you know, there’s no other way to be. I don’t understand. I know the saying, fake it till you make it, but that doesn’t apply to the way you are and the way your personality is. That’s just a mindset and a way of thinking. Yes, if you’re in a certain position in your career, you don’t want to dress like that, you want to dress for the position you want. Yes, I understand that, but you still have to be authentic in your personality.

John:
It’s true. Well, having the opportunity to meet you face-to-face as well as doing this podcast with you, I can verify that you walk your talk, you are consistent in all of your interactions whether it’s a tweet, in person, and email, setting this all up, you know, you just, easy, nice, fun to be with, and that’s what investors are looking for. They want to be with people who they like and that likeability factor is another thing that you can’t fake. There’s a great book about that that Tim Sanders wrote called The L Factor. Speaking of books, what are some of your favorite books that you like to read when you’re traveling or that you think the audience should be reading?

Scott:
You know what, I don’t read a lot of books. I have read quite a few in the past, but now I’m into more podcasts, coincidentally, and I’m not just saying that because I’m on here, but you know, I’m a massive, massive, over top the Gary Vaynerchuk fan. I just think his mindset, because he’s not from the digital industry and he talks like a real person. So, you know, I love his show. I love John Lee Dumas. There’s a few guys that I just, I’m hardcore addicted to. You know, Grant Cardone. I just did his show, actually, Power Players. He has another show called Young Hustlers.

You know, these guys. I love optimism. I love positively. I can not stand pessimists. I can not people that are negative. You know, that old saying that everybody uses is so true where is, you are the sum of your five most closest people. You know, if you surround yourself with shit, guess what’s coming out of you.

John:
It’s true because you get people commiserate how hard it is or how tough it is as oppose to, you know, you know what? We’ve been knocked down before and we always get back up and we’re going to make it and all that good stuff that keeps you motivated, keeps you going.

Scott:
Let me tell you something, if it was easy, everybody would be a God damn success.

John:
Now, of all the countries you’ve lived in, you’ve seen so many different cultures and mindsets. I’d love to get your perspective on what’s it like in other countries that you’ve lived in, again, Thailand, Spain, the UK, the Philippines, Portugal, how do those countries and they’re all different, I know, but you can just pick one or two, differ in their perspective in entrepreneurship.

Scott:
You know, for me, my favorite place on the planet is Thailand. I just absolutely love it. I love the organized chaos everywhere in Bangkok. It’s like living in New York, but in Asia without the insane crime, but everybody is warm and nice. It’s like, it’s the craziest thing you’ve ever seen in your life. It’s the last thing you’d ever expect. You know, but the startup scene there is huge. The social scene there is massive. I don’t know, most people don’t know this, but Bangkok is considered the most social city in the world.

John:
I didn’t know that. Hmm.

Scott:
Now, I’ll tell you, more than any other big cities in the states as well. In Bangkok, there’s 8.9 million people in the city center, not including the suburbs, which brings it a total of probably 12.5 million. So, in the city center, 8.9 million people. Out of those, 8.6 of them are daily active Facebook users.

John:
Wow.

Scott:
Active! Logging on several times a day. Outside of that, three out of the last four years, the most Instagrammed place on the planet was in Bangkok.

John:
Really?

Scott:
So, when I tell you that Bangkok, first off, it’s the center of South East Asia. It’s much more developed. If you’ve never been to Asia, don’t think that everybody there is riding around on elephants like all my friends that have never left the US. It is more developed than some of the cities in the US. The shopping malls, the public transportation, they blow away any city in the US and what I like is, it’s super, super developed, but then right next door, you can see a street stall. They keep the local culture, they keep the local flavor. They keep the local pricing. You know, you can get as seven star as you want or you can get as one star as you want and you can get anything in between.

John:
Wow. That’s great. Well, no wonder you feel so at home there if that city is so engaged with social media and you are so engaged with social media. Now, besides Twitter, are you active on LinkedIn, Pinterest or Instagram, Facebook? What’s your other favorites.

Scott:
So, in order of my importance is Twitter, Instagram, Facebook. You know, I need to get more active on YouTube, because videos are becoming more and more important basically everyday, especially, I would say, in the startup world as well. One thing that I’ve noticed is there’s a lot of VCs in South East Asia. What they’re doing for, you know, wanna-be founders or people that have ideas and, you know, they want to pitch them. They are having them send them short videos along with the pitch deck or the plan.

John:
Ah.

Scott:
So, it might not be a bad idea, you know, again, it doesn’t have to be professionally edited. It doesn’t have to be Universal Pictures production, you know, just hold up the thing, just like we’re doing right here and blah, blah, blah, let’s do it. Again, super, super important for all industries, but it’s getting really important in the startup world.

John:
Speaking of video, what do you think of Meerkat vs Periscope with Twitter?

Scott:
You know, I’ve sampled both. I haven’t really jumped on the band wagon, you know, full steam. I know some people that do and some of them are having success, some of them aren’t. I just haven’t jumped on board yet. I use the Twitter video, upload a lot, and I see my engagement double or triple than my normal tweets. So, listen, the platforms that I concentrate on are keeping me quite busy right now.

John:
Yes, indeed.

Scott:
Every time there’s a new platform comes out, I’m like, oh my God, because, I don’t, it’s only me! I’m not one of these people that, okay, can you tweet for me today because I’m busy in meetings. It’s all me, all the time.

John:
Right, and that’s what makes it so successful, yeah.

Scott:
But, having said that, my Instagram is probably, if you look just, you know, follower per follower size, my Instagram is growing faster than my Twitter right now. So, it’s interesting.

John:
And do you have suggestions beyond some of the great suggestions you’ve already given about, you know, have the right voice, be consistent, be non-stop, but if a startup wants to grow their Twitter following, let’s say, do you think that they should follow and retweet – anybody that follows them, should they instantly follow them back, do you have any basic tips?

Scott:
I have a couple thoughts on this subject. Number one I would say, if you are founder or a potential founder or a startup guy or whatever, I think you need to build up your personal brand. Concentrate on that much more than the company you’re developing, because if you build up your personal brand, you never know what tomorrow is going to bring. Say tomorrow this idea gets scratched and you have to start over, then what are you going to do? You’re going to start over from scratch. If you have your personal brand, you can talk about anything.

John:
Yes, great.

Scott:
So, concentrate on that much more than the company, but you do have to incorporate company and your conversations and, you know, for me, I think it’s high twitter etiquette to follow back. The reason most people don’t follow back is out of pure laziness and I’ll explain what that means. That means, they say, I don’t want to follow too any people, because I don’t want my timeline to get clogged, but realistically, why don’t you segment your lists, that way you only follow your lists and you can have, you know, finance or sports or social media, digital, whatever, entrepreneurs, and just follow specific lists, so you can really get the subject down and narrow your focus instead of just taking the shortcut and looking at your timeline.

John:
Got it. And speaking of lists, I noticed that you have a lot of lists that you follow. What’s your philosophy on that?

Scott:
I only follow my list, because my timeline, it’s too – it moves too quick and obviously I can’t follow 600,000 tweets. So, if I see good content from you or I know you or I expect good things from you, I’ll add you to a list right away and I constantly monitor my list for deadwood or deleted accounts. I remove and add people from my list, everyday.

John:
Wow. I love that.

Scott:
So, it’s the most time consuming part of my day, but for me it’s worth it.

John:
Sure, it’s curating your stream. Scott, obviously we want to encourage people to follow you even though you “don’t need it”, but they’re going to be so inspired to want to watch you as you travel around the world and share your words of wisdom with us. What are the best ways for people to follow you on Twitter and all the other places and how should people keep up with what’s going on with ZipKick?

Scott:
So, my website is MrScottEddy.com and I’m on every social media platform @MrScottEddy or just Gogle me. I’m all over. As far as Zipkick is concerned, go to Zipkick.com. You can sign up for the releases and it’s actually in the app store now, but we’re just finalizing a few bugs that we have and the official launch is going to be sometime in the next couple of weeks, but good things coming, big things are coming.

John:
Exciting. Scott, I can’t thank you enough for being on the show. Your insights are fantastic. I think my favorite is the ROI and the R stands for relationship. That really encapsulates your strength and your wisdom and your success and I’m excited to watch you and Jason kick butt with Zipkick.

Scott:
Alright, John. Thanks a lot.