Organizational Efficiency Machines - David Karandish - Capacity - Episode #84

I don't care where the input comes from. Every product request is getting written into a consistent place.

Welcome to Not Another CEO Podcast. I'm your host, David Polites. Every week we talk to inspiring leaders and get the true stories, the ups and downs, the lessons learned, and come away with actionable advice for our own journeys. Today's guest is David Karandish. David is a serial entrepreneur. He's the founder and CEO of Capacity, an AI powered support automation platform. In just the last three years, he's acquired and merged 14 companies into Capacity and they're now serving over 20,000 customers around the world. Before Capacity, David was the CEO of Answers.com, which he scaled to massive reach and eventually sold. He's been involved with a number of organizations over the course of his career, and now he's a board member@equity.com, an incubator in St. Louis. And he's also a board member Create a Loop, a nonprofit that is focusing on bridging the digital divide by bringing computer science education into schools. Across his career, David has built and operated companies through multiple technology cycles, from early Internet platforms to today's AI driven businesses. Please welcome David Karandish.

Nice to be here, David.

Really excited for this first question right out of the gate. What is the one thing that you've done at capacity, big or small, that's had the biggest impact and you would do again if you're CEO of another company in the future?

The single biggest impact strategically that I've done is building out a compound startup. If you're familiar with Parker Conrad from Zenefits and rippling as this term he coined that I liberally borrow compound startup. And the basic strategy is this. In 2025, 2026, there's a point solution for just about everything. Out on the web you can find a lawn care CRM company if you want. You want to get really niche. The next unicorns and the next decacorns are going to be the companies that take what used to be disparate solutions, put them together, lower the cost of the individual sku, maximize the price in the bundle, and then crucially be integration as the product. And so we started out at Capacity, originally automating support within teams as a Slack plugin. Then we added our web concierge to go external facing and to help with customer support. But there was this unarticulated need. We kept hearing from people, they're just like David, I don't want to go to one place for my help desk and a different place for my workflow and another completely different vendor for all of my voice iva and a completely different vendor for my SNS or my live chat. And so we looked at this and we said, what if we could put all these pieces together into an integrated platform? Now, when I came across this compound startup framework, just made so much sense. I went back with my team and we mapped out what are the 24 steps of the customer experience journey. And then the outgrowth of that is that certain parts of that customer experience journey we would go on to build, certain parts we'd go partner in. So for example, we didn't have to build a payment processor in 2025. We've got a partnership with Stripe for that. But then there'll be certain parts that we can go find a wicked smart entrepreneur who's done a really nice job building their business out, acquire them at a reasonable multiple. We do all the integrating and the duct taping and Elmer's gluing and then cross sell upsell like crazy back out to our respective customer bases. So that's super high level strategy we're running here at capacity and was the biggest impact of everything, probably the biggest strategic impact of everything I've done since I've been here.

Did you, did you have a lot of experience with M and A before this? Because that's a lot. I mean, when I started reading all the acquisitions, I'm like, this is like, is that, is that something that you had or you brought someone in who had that experience?

So we had, I had M and A experience, as did my CFO from our time@answers.com when I was the CEO there. I think we did some like six or seven acquisitions at, at that company. So I, I knew a little bit of the playbook coming in. And then I'd been private equity backed a couple times before, so I kind of knew the private equity playbook. The difference though, between the compound startup playbook and just a private equity playbook is that everything we acquire has to fit together. This is not a, we're not building a hold Holdco house of brands. Everything we acquire has to fit together and specifically has to be something that can help us execute on our mission. Our mission is we want to help teams do their best work and we believe that AI automating support is the best way to do that.

And when you go out to do these acquisitions, like how, what is the number one thing you know so you're looking for, does it fit into the product? At least in my experience with acquisitions in my Career corporate culture can some can sometimes be a little bit of a, of a challenge in, in that and I assume just knowing some of the companies that I do recognize that you, you've acquired, they may be bootstrap companies, they may like how, how do you handle that? What do you look for, you know, when you're doing that?

Yeah. So I think one of the first tenants of this is that you want to start out with Hippocratic oath, like first do no harm. Like these companies. If we're acquiring a good company, there's good DNA there, there are good people there, good products there, good platforms there. Like we don't want to come in and break it. So the first thing we do is we come in with a learning posture on what can we learn. We're learning that in the diligence process and we're learning that post, post, close as well. At the same time we want to be helpful. Like it's one thing for us to acquire a company and that company's helpful to us. We want to be helpful to the company we're acquiring. Oftentimes that means taking away big functions that were poorly done or that were split between multiple people and centralizing that. Oftentimes it means helping with a product enhancement. So when we acquired Textile a couple years ago, Textile was sending about 5 million SMS messages a month. But they had no virtual agents, they had no bots, they had no AI. And so they could have humans go and respond, but if somebody wanted to have a full fledged conversation, it had to be a person. Meanwhile, we had been building bots and virtual agents for years, but we didn't have any SMS channel. So we looked at this and we said, well the first thing, before we even try to integrate Textile back in with Capacity, let's get Capacity's virtual agent plugged into the Textile channel. And then eventually we got them both cross connected as well. And so we try to first check on a learning posture. Second, we want to be able to pull off any areas that are not core or need help. And then we want to add benefit as fast, add value and add benefits as fast as quickly as possible. At the same time, another thing I really like to do is I'm a big believer in seeing people work out of their superpowers, so particularly with the founders. So we had one founder went into more of a deep tech role, another founder that went in a BD role. We had another founder came in and helped us opera a little older founder who is a little later in his career wanted to help us with all the operations for running, we run eos internally. And so what I really like to do is find founder superpowers and say let's go strip out all the other BS you had to deal with being a CEO and have you go focus on the area that you love, you love to do and you're really at. And that can add value to the company.

In terms of financing all this, is this through venture, you know, is this through debt? Is this. How do you finance all that's a. Again, when I think about the numbers, I'm just like, wow, this is a lot of, a lot of acquisitions in a short period of time. Or equity, like, how do you finance it?

Yeah, so we'll typically do a, you know, anywhere from zero to about a third of a third of it in cash up front and then 2/3 is a combination of either equity, earn out, seller note or other kind of contingent payment.

Got it. And when you like. So I agree with this compound startup. I mean to me, having spent my career really in SaaS before it was called SaaS and cloud and kind of seeing this, just this explosion of SaaS applications in 2021, everyone had like six of these, four of these, two of the. And exactly to your point, none of it really talking to each other. The integrations were really bad. Like, and the consolidation, I saw it firsthand. I mean literally I saw the, you know, we were tracking number of SaaS apps in use of companies and you could see it, you know, kind of start to come down. Everyone was trying to consolidate. Do you feel like we're kind of in this again with AI, at least for me, like, I'm looking at the AI world and I feel like we're back to this same story again where people like, well, I'm going to use this AI agent to this thing and this AI agent to do this thing. Like is that, you know, when you think about your business and you think about the market more broadly, like, can you talk through what your thoughts?

Yeah, so I totally agree with you. There's this pendulum where anytime a new type of technology comes out, it starts out with a rush to collect point solutions and then the platforms end up taking over. And so we looked at this and we said very similarly in the SaaS space, you've already seen a big wave toward consolidation. Now in the AI space, there have been a bunch of point solutions that have come out over the last couple years and now companies are saying, look, we can't manage all of these different AI apps. We need to start to like skinny down to a smaller number that are going to go be impactful so we don't have to spend all the time, he said, doing that duct taping and Elmer's gluing to make this stuff work. I went through, I've got a slide in one of my decks where we outline the 24 steps of the customer experience journey. And if you look at every edge connecting each one of those nodes, there's 276 edges in those 24. It's for my math nerds. On the, on the podcast. There's n squared minus n over 2 for people who are interested in that sort of thing. And so it gets to be really, really big and really painful for customers to have to clients and customers have to deal with. And so we can come in and help them with that. There's a huge win there.

Do you have a specific ICP ideal customer profile that you're focusing on with this is this mostly SMB mid market.

Enterprise center of the fairway for us are contact centers. And the reason for that is that contact centers tend to get the largest number of emails, tickets and phone calls they have to deal with, which means we can solve a much bigger problem for them. Now we can work mid market to enterprise. We do have some SMB customers that will use us for various parts of our platform for like calendar scheduling or for SMS reach outs. But our kind of bread and butter is a contact center that needs to deploy virtual agent, get call analytics, get real time agent assist, do some workflows, manage tickets. Anyone who is trying to reduce the burden of support. And to be very clear, I'm an AI pragmatist. I'm not coming in saying, oh, AI is going to take over everything. There's going to be no humans post scared city society. I think we're a long way off of that. Personally, I think people miss out that human expectations tend to evolve very quickly. I have a fairly recent iPhone. If I gave you an iPhone one, you couldn't even use it today. Don't copy and paste, it's on 2G, et cetera. That phone was three generations ahead of anything that was out there at its time. That's not that long ago, right? There's. What is that, 20 that 2000, 2007, 2008. Right?

Yeah, yeah.

And so the reason I reason I bring this up is that yeah, I think there are going to be a lot of jobs that are impacted, a lot of things that change for sure. And our expectations of what is possible, like we're in the top of the second inning of the AI revolution. This is going from a 14,4 dial up modem to a 28.8 dial up modem. It's faster, it's better, but we're still in the dial up phase of that.

I want to transition a little bit. You mentioned eos. Are you like an EOS kind of, you know, is that what you've used at all the different companies you've been a part of?

I'm actually pretty new to EOS. We started using this about, about 18 months ago. But it's been a great framework for us to use. I do, funny though that you mentioned this is I do collect organizing frameworks. So that's one of my, one of my weird hobbies. And so I have all these different frameworks I use to run the company and EOS has helped us particularly with meeting cadence and some of our goal tracking. But I'm a big believer that communicating through organizing frameworks is a great way to get everybody aligned. So I'll give you an example of my favorites. When I think about problems within an organization, there are three different buckets. You have your problem describers who are really good at telling you what the problem is in detail. And I don't want to gloss over that because many times if you don't have a well described problem, you got a lot of problems that'll happen out of that problem. Then you got your classic problem solvers. These are your engineering types, these are your folks who like to roll up their sleeves. You give them a problem, you know, wrestle that to the ground. But the hardest role, in my opinion, both to hire for and to train for, are not your problem describers or your problem solvers. It's your problem selectors. These are the folks that are really good at knowing which problems are worth solving in what order. And that is the hardest meta skill to go communicate out to the team and to have. Because it takes a lot of integration of different parts of the business to know which problems are worth solving in what order, at what time. I've worked with guys and gals in my career who are phenomenal problem solvers, but if I gave them a list of 10 problems to solve, they couldn't pick the top three if they had three drives.

In. Within EOs, when you talk about the communication kind of framework and what do you think has been the most powerful part of that? You know, meaning is it the all hands meetings, executive team meetings, the planning, like, what if you chose one thing? Like this is the most important element of the machinery, what would that be?

I, I think the cadence around setting the, the goals or rocks in the EOS framework has been the most impactful for us. It just ensures that we have clear communication on what we are trying to accomplish over what time frame in a distributed environment. We have over 350 people working here at capacity in six different continents. And so we want to be in a position where we have to be able to communicate this stuff to folks at all every hour of the day and every 30 different countries. And so having a cadence and a framework for how we do our goals and how we communicate that out is super important.

Yeah. At least for me. I've had a number of CEOs on here that have talked about being the chief Repeatability officer or chief Repeating officer and how, you know, as the companies get bigger and you have five hundred and a thousand and two thousand, like you just have to be able to share those goals, repeat those goals, you know, share them again, repeat them again. And, and, and I, I didn't appreciate that myself as an operator because I was like, well I told them already, I sent them the email about it, you know, and then I would have an all hands be talking about something people like, why are we doing that? I said the goal that I shared with you, you know, four months ago. He said, I forgot that already from four months ago. And I tell people, I think the operating rhythm, whether it's ELS or some other framework, the operating rhythm and the communication, I truly think literally changes come. It's so weird because I think for a lot of first time founders, but I have the best product and I'm good at selling. It's like, yeah, but at some point that's not even like you have to operate.

Yeah, I mean one of the challenges of being a founder, as you continue to grow and scale as you start out, you were either really good at building or really good at selling typically. And as you get bigger, you need other people to build and other people to sell for you because you can't be in every single conversation, you can't be on every piece of the code. So whether you're coming up the sales side or the, or the, the tech side, your ability to deliver value through other people becomes a much bigger governor on your success. Other thing we like to talk about a lot is this idea of building machines, of what does it look like to build machines in every single part of the organization. And by machine, I don't necessarily mean think like a physical idea, I mean more repeatable processes. That scale and remove as much human decision making out of the process as possible. So I'll give you a quick example. Take our customer success. We get product requests from customers all the time. Step one, non machine. They're all being sent into different places. It's not organized, it's not aggregated. It's what unfortunately a lot of software companies are still like most.

Yes.

That when you get into step two, what I would call a descriptive machine in this case, I don't care where the input comes from. Every product request is getting written into a consistent place. Then you get into step three, which is more of a predictive machine. Okay. Based on these particular requests, which clients are going to be likely to churn if we do not address these. Is this a nice to have that somebody was like hey maybe we. Maybe we should do. Or is this a must have that if we don't deliver this particular feature or fix this bug, et cetera, these customers are going to walk out the door. So you get in a predictive machine, then you get in a prescriptive machine. Well, we can't do everything at once. How do we sort order this list by ARR. Impact over time and then eventually you get into an automated prescriptive machine where those prescriptions are being made and then it's constantly feeding back in. So you think of these five stages of building a machine. You could then apply that to every single part of the company, whether you're talking receipt management, all the way up to how you do your marketing. And so we really. One other trait I like to look for in my both of my executives and especially next layer down is folks who can not only operate the machine, but can also help build the machine.

So one of the things I talk about recently especially I've been talking a lot about all the mistakes that I made building the companies I've been a part of. And one of those mistakes that I've made way too many times is hiring people who can run the machine but not build a machine. And I'm sure at some scale I never reached that scale. I'm sure at some scale, thousands of employees, it's fine to have the people who can run the machine, but you know, at this stage other than that, like you need people who can also build the machine. And it's a really good point. Like I think that's a good like summary of how to describe that is is running like I always give the example. I hired this guy from Google. He was great like at Google, I'm sure. But then he came to us and he didn't. I mean he had a, an assistant, a rev ops person. They had all the machinery at Google for contracts and this. And then he gets to us. We've got like two reps and nothing and, and no idea how to build, you know.

Well, it's interesting you say that because I, I think, I think early on in my career I hit a real bias toward people that didn't, didn't work out and was like, oh, they're just, you know, terrible, terrible worker, whatever, whatever. And as I've gotten older, I think what I've, what I've kind of realized is that there is a stage fit for people in different companies. I interned at MasterCard when I was in college. MasterCard is a fantastic company by the way. It's a fantastic company, one of the best companies to work for. Great benefits, wonderful people, wicked smart. But in my role and somebody coming out in college, coming out of college, I get very little impact on mastercard bottom line in, in a video for a very long time.

Right?

So for me, it's not that I was a terrible human. I wanted to be someplace where I like direct bottom line impact immediately. Conversely, I hired a guy, he used to work at Google and we were trying to get into a contact center and at the time, this is years ago, but this particular contact center required, I think it was like hosting in Malaysia and we didn't have AWS Malaysia set up, but it was going to be a huge pain. We went through this whole thing and then finally I realized I was like, this problem is not in the top thousand thousand things I have to deal with or on the, on my list. You gave me a thousand problems to worry about. I cannot worry about this problem that came up. But if you're at Google worrying about some rogue country suing you for whatever, like that is a really big important problem go solve. Right? As a startup with 500k of ARR, figuring out the nuances of Malaysian law was not like you said, at the top thousand things on my, on my radar. But if you're at Google, you, you, you have to figure those things out. So it's not that I'm a bad boss and this was a bad team member or vice versa. I was a bad team member at, when I was at. It's that you have to find people that have the right stage fit for what you're trying to accomplish. The other big thing I've learned, David, I'm curious to get, get your thoughts on this because I've Seen this play out so many times in my career. There's this difference between what I call bicycle problems and network problems. So bicycle problems are problems where you get on the bike and as long as you pedal, the bike is going to move forward. Now, you might be a better biker than I am. I might be a better biker than this guy down the street. But if we're on the bike and we're pedaling, the bike is going to move. So these are problems where the effort to outcome ratio is very important. But as long as you put in the effort, the bike is going to go. Many, many problems fall under that category. But then you also have these problems. I like to call them network problems. Network problems. They are not directly correlated to how hard you pedal the bike. The solution to those problems are directly correlated to who you know. You think about a lot of key partnerships can be like that. Certain areas of sales, running an M and A process in many cases can be like that. It's not just pedal the bike harder, the size of your cab muscles, it's not going to determine your outcome. It's more, how many handshakes have you had? And so I've also run into situations where I had really smart, hardworking folks who look at things thinking that they're dealing with a bicycle problem, but really they're actually dealing with a network problem.

I, I do, I, I've not heard it put that way, but that is a, that is a very good way of putting it. Like where you have those, those jobs where just pure work ethic essentially will get you, you know, someone who's willing to hustle will achieve the result. And then there's some, you know, I had a founder call me one time and they said, I want to sell the company. I said, okay. And they said, well, here's my list of all the M and A people I'm going to go reach out to and I'm going to call them and ask them if they want to buy the company. And I said, I don't, I don't think that's going to work. You know, like, and, and she's like, well, can you help me get to this? And I said, this is not the way to sell the company. And actually it was an exact network problem where understanding who the right people were at the right time, getting the introduction so they would take the meet like that. She, she was, she had been trying so hard and she wasn't getting any of the meetings and it didn't matter. It was exact example of what you just Said, you know, and I'm curious in the interview process in general when you're looking to hire for your team and I'm saying directly your executive team, how do you get to the point where you understand if they have that builder ability to build a machine and run them? Like how do you, how do you assess that?

It's very well, let me start out with. It's very hard to assess. I'll just go, I'm going to start out with that. One thing I have noticed though is that the best people who are good at coming in and automating are people who just can't stand to not do that in their own personal life. One of my questions I ask people is tell me something you've automated in your personal life recently and if they can't answer something on that, if you can't answer, if you can't automate things in your own life, really low likelihood you're going to come in to my organization and help me automate things. So that's like just a very simple, Good, good question. Interviewing question. The other thing back to the problem selectors is I love to ask people how do they make decisions like how if we bring you into this organization, how are you going to increase our collective decision making capability? What frameworks do you use to make decisions in your life? How do you make trade offs on various decisions? I like to understand people's decision making frameworks and how they think about how they think about things. So if I have somebody who's automating in their own life and they think really deeply about how they make their decisions and what frameworks they use and why they're jud. They increase the collective judgment of our company by joining us. Those tend to be people on who add a lot of value.

I want to pivot a little bit here. You know, from what I have been able to research and see you're very active in St. Louis, like in the, in the entrepreneurial community and the incubator Equity.com. like you're very active. Can you talk a little bit about that market? I mean it's not, I wouldn't say it's considered, you know, the hotbed, you know, of technology. I know there are good companies there. I'm just saying it's not considered one of those places. Can you talk a little bit about why you've, you're there, why you're building there, you know, the market. I don't know very much about it. So I'm, I'm actually, I'm very Curious.

So I'm a St. Louis native, so that's part of the reason why I'm here. But I did go to Washington University in St. Louis. Great university. And one of the things that has changed over the last 20 years from when I was starting out to today is that 20 years ago it was very difficult to go get early Stage Capital in St. Louis. There weren't a lot of mechanisms for that. If you wanted pre seed, seed a round capital, it was hard, it was tough. That space has gotten better. Like if you're a startup in St. Louis, it's pretty easy to get funded for your early stage endeavors. I think where there's still a gap in, in A, in a place like St. Louis is the late stage funding. If you want to go get B, C, D, E, pick your letter letters of the Alphabet, that is a lot harder to do here. I, I've had a, you know, great exit serial, serial entrepreneur. And even for me outraising capital, it takes, takes a lot of work. And so what I, the biggest thing I would like to see change in St. Louis is we need to get better mid to late stage capital offerings specifically for tech, so that companies can raise that capital here, spend less time fundraising, less time going out to the coast and then have that recycle. I also think that from a skill perspective there's some great engineering talent in St. Louis. We've got great folks in customer success here. We've got great folks all over the place. The hardest area to hire for in terms of specifically in St. Louis is product management because it's such an interdisciplinary role where you need some engineering background but you also need some design background, but you need some empathy, but you need some business background. We kind of need to be able to marketer as well. I would love to see institutions like Washington University actually build out product design as a, as a, as a major, as a, as a degree. Stanford, you can go get a design degree from the D school there. I think we need that same kind of thing here in St. Louis.

Are there like you know, groups, startup CEO groups and kind of co working like is there that kind of an ecosystem? They're building a lot of co working.

Space, a lot of different incubators. I'm at a nice CEO poker group. We get once and months to get together and money just kind of rotates around and yeah, there's a, there's a growing kind of St. Louis Illuminati of startup founders who are all working together.

Yeah, I mean I, you know, I started my career In Atlanta, I went to Emory. I started my career in Atlanta. And Atlanta, really similar kind of dynamic. And I think, you know, it actually, what I observe, because now it's. It's actually for the Southeast. I mean, Atlanta now, I'd say is the capital for kind of Southeast tech. And a lot of that came from having a handful of really big exits, I think, you know, and then kind of it sustains. It's, you know, it's kind of. Once there's a couple of big exits and people have been through those companies and they can start new companies or join other companies and help them grow. So I feel like that's what these ecosystems, from what I see, like in an ecosystem like that, it took that to then bring the investors. You know, it's a very. You need the whole ecosystem. You need the companies that are small, the companies that are big, the cup, the founders that have exited who want to reinvest. Like, you need the investors who want to come. And they see it in the beginning as like an arbitrage opportunity, and then they actually see it as like an opportunity, you know. So, yeah, it's, it's. But when you have, like, great schools like Washu and, and others, like, it feels like those cities, there's a lot of opportunities. I, I think a lot of kids come out of college, they don't really want to leave. I mean, if they had a good experience, like, they, they want to stay. But a lot of times there aren't the places to stay at.

We saw a survey. This is a little. Little dated at this point, but a few years back, if you did an internship at an entrepreneurial company in St. Louis, you're almost twice as likely to stay in St. Louis after you graduate, I believe.

Of course. Right? I mean, I believe that.

Right?

Yeah.

Yeah. Not shocking, but accept the intuition.

What is the biggest challenge I ask every guest this, this question. What is the biggest challenge that you've faced? And if you were able to overcome that, how. How did you overcome that?

What's really interesting is I feel like now I've never actually been in one of these, but they. I think Microsoft has one of these up in Seattle, but they're. They're these. I forgot what they're called, but the chambers where you go in and you literally can't hear anything.

Oh, my God. Anxiety to dig away.

So I feel like from my perspective, AI went from like, like, almost like you can't even get the words out there. People were like, early on when I was starting this, they're like, is this different from AR or VR blockchain? I look at someone, are you building a Terminator? Like, I had those types of questions back in 2017, 2018, when we were going to. Now we've got the opposite problem. There's so much noise out there in the market. There's a new AI startup every day. There's ever a new model here, there's a new this, that. Like, there's so much noise that companies are having a hard time cutting through that noise and figuring out, okay, what do we need to go? So I feel like in a very short period of time, we went from almost no ability to hear what's happening to a massive amount of noise. And so cutting through that noise is a really important part of what we got to do into 2026.

So speaking of that, like, where, where is capacity in three years from today?

Yeah. So if I Look at it, three years ago we had 75 customers, couple million of ARR. Today we've got 20,000. We're approaching 100 million. We're not there yet, but we're approaching 100 million of ARR. And I think three years from now we will have made so many more of those connections between the parts of the customer experience journey that it's just seamless and it's not reactive, it's proactive. It's capacity reaching out on your behalf to help you do your best work. That's what I'm gonna say.

I wanna talk a little bit about your background. Did you always know that you were going to be a founder? Like, did you grow up in some family of entrepreneurs or something?

Like, I didn't know that early on, but I can remember as a kid being in Cub Scouts and I was a terrible Cub Scout. I couldn't tie the knots. My dad and I went on like a little camping thing and our tent is like leaning over and his horse flies everywhere. It was terrible.

Right?

But I was really good at capital raising, which in that case was selling candy for the troop. Right. So I was, I was capital raising when I was 8 and it was obviously different scale, different time. I can remember I was the top fundraiser, top salesperson for the troop. And I can remember even though I had zero desire to be Cub Scouts, that was only for a year or two. That was a very early sign that, okay, there's something there in this kind of salesy capital raising type world at the same time. I started learning to code in high school and I just loved it. The ability to take an idea and go build Something that people could use and to make that available on the Internet for or you know, thousands and eventually millions of people to use. I just, I just love that. And so as I was thinking through what I wanted to do when I, when I went to college, I ended up studying computer science undergrad from Washu, but I also got a second major in entrepreneurship. So the, the fusing of the technical side and the kind of sales and capital side together to, in order to go solve problems and go deliver great outcomes. Like, it just felt like such a hand in glove fit. I am, I'm so thankful that I get to work in a field or in a, in a role where I get to use a lot of my gifts and talents and background every single day.

It's, it's a pretty unique, I mean there aren't, there really aren't that many people who can both be the engineer and be the salesperson. I mean there, there are some, I guess, but it is, it is rare actually that you have both, that you have passion for both. You know, at least when I meet people, you know, you either see the sales guy, saleswoman, or you see the engineer. And, and they're very. It's interesting that you have both. Yeah.

And very clear like our sales team is. Got way better salespeople than I am. Our engineering team, we got way better engineers than I am. But I have enough of both sides that I can be in a product meeting and we can be debating different types of things we're going to go implement. But I could also be sitting down with customers and listen to what their problems are and helping them brainstorm as well. So that that combination of technology, entrepreneurship I started doing in high school, building web pages for people and you know, we had a little online lead gen business. We started those types of things all kind of led to what I'm doing now. If you ever saw that movie Slumdog Millionaire show and the whole show is like the summation of his entire life event feels very much like that with what I'm doing here at capacity.

What do you think in the course of your career, what was the biggest break for you? Was there a person, a moment in time? What was the biggest break?

Ooh, that's a great question. I think in my. So in my last company, we originally started out as a comparison shopping engine and the idea was you could go to our websites and find products you want to buy. And then what we realized pretty early on was that there was this. Again, this was 2006. So put your jump in your DeLorean. Go back, go back 20 years here. But there was this massive arbitrage opportunity between what it would cost to show up on Google versus what we could get paid, show people various products and services. And so what I loved about that business model was that I really was you put a dollar in and you get a dollar 20 back out and you just repeat that over and over and over again. The challenge though is that we had one customer for basically one customer for our first five years, which was Yahoo. Yahoo was our big search partner at the time. Yahoo was a big comparison shopping engine partner. And so we built this really fast growing, profitable business that was ridiculously concentrated early on. And so like it was just a very weird experience going through that. And I'm so glad, so glad I got to do that. But then that led us to go acquire answers.com led us to go get into a little bit in the SaaS space, rolling up some customer experience companies. And so it really did, it really was kind of one thing that built on top of another. But that, that, that machinery of. And it was kind of our own little prescriptive machine on how do you scalably acquire consumers in a B2C environment and get them to engage. That was a really fun problem I got to, I was fortunate enough to tackle when I was 22 years old.

Wow. Oh, wow. That was like, that was right out of, right out of school. Yeah. Cool. What, you know, so you've been through this entrepreneurial journey. You've been on this journey for eight years. It's, there's the ups, there's the downs, all of that. How do you, how do you manage that? How do you, you know, who is your support system? Like, you know, because it's a shitty job. You know, again, I've been through it, but I've also, I've interviewed everyone and like it's, you know, it's, it's never easy. Never. Even in the good times is not easy. So how do you deal with that?

Yeah, so a couple, couple different things. The first thing is I have, I have learned that entrepreneurship is as much about energy management as it is time management. And so Paul Graham put out something a few years ago on the kind of maker verse manager schedule on how when you're a maker you need uninterrupted time to just build and need focus blocks, etc. And when you're a manager, you need, you need time to like meet with your one on ones and do your direct reports. Yeah. Meet with your directs and go do These types of things. And then if you're in a money role where you're out selling, you need a different type of structure and schedule because you, you are at the behest of people who will take your calls. And then if you're in an M and a role where you're either raising capital or acquiring companies, you need a slightly different role. So I kind of think of them as the four M's. You're either a maker manager, you're in a money role, or an M and a role. And as an, as an entrepreneur and as a early stage founder, oftentimes you're switching between those. You don't have somebody to go do all four of those, particularly in the early days. And so what I ended up doing with my, my executive assistant, by the way, I have phenomenal executive assistant who's helped me grow and scale as we start out with this, we call it kind of ideal calendar where you start out with blank the calendar out. How would you structure your time so that David, you have the most energy to go do the task that you need to do. And it's a very different kind of level of energy you need to be at. If you're heads down building something vers you're doing internal meetings versus you're doing external M and A vers you are, yeah, just out doing, doing sales. And so we, we, we, we kind of crafted that first. The other thing that I, I, I learned the hard way from my last company, my last company was running 24 7. There would be, you know, traffic and websites and all, all this sort of stuff. This company's a little more, more work hours stuff. Although we're getting more international now. So I set up my schedule for when I would work late where in my before, the thing that drove my wife was that she didn't know about becoming Omet 5 or becoming home at 8. She didn't know, you know, I'm working late this night or I'm not working like this night. And so what we did is we said okay, Monday nights and Wednesday nights are my work. Late nights come home, eat dinner, say hi to kids and I'm, I'm in it. I'm, I'm working until 10, 11, sometimes later. But those are my, those are my late nights. I'm a night owl. There was another thing I had to learn early on is like I night do not be with 9am for you or for me. Tuesday nights I do a date night. And we try to do that every night or every week. I think in the last year we probably had 46 or 47 out of 52. Tuesday's a great night because in St. Louis most of the restaurants are open but they're not all booked. But we don't have. Feel like our date night has to conflict with, with friends schedules and things like that. I get kids and sports and all the things. Thursday night's kind of a flex night. I'll usually work on Saturday mornings and then I'll take Saturday afternoon, Sunday afternoon, kind of do a little slackless Sabbath and then I jump right back in. I'm working on and off on Sunday after Sunday afternoon late. And so having that 24 hour Sabbath, very old, ancient practice. The very important I think for recharging, having a schedule where you have these time blocks out where you can focus your energy as much as possible. I think that's very important. And then my wife, she's amazing. I couldn't do this without her. Especially with four kids.

Four kids?

Yeah. I've got a 14 year old, a 12 year old, a 10 year old and an 8 year old. So three girls way. So it's a very, we have a lot of, a lot of structure around the calendar. And then the other thing I started doing right at the pandemic is I do these early morning walks where it's kind of a prayer time, time to get out in the morning. It can be 15 degrees out. I got my parka on and my ridiculous looking gloves and it's just a great way to start the day where I can collect my thoughts. As a practicing Christian, I get to pray. Now we got a dog. And that's my, you know, somehow like my kids thought they, they told, they convinced us they did a better sales job than I did convincing that they were going to take care of the dog. Now I take care of the dog. But getting that like carved out time where you pull away from the business is very, very important.

I really like that. I think the structured calendar piece is a really important piece. That in the early. What I see a lot of founders do, including myself, is you'd block the calendar and then you just let people book over it. You move stuff around, you know, and when you actually hold to that calendar, you figure out that you will find the time to get the stuff done. But the routine at least it depends on. For me the routine was so, you know, I, I was like, I'll work from 8am to 8pm straight and my EA would be like, Dave, maybe we should put like some break maybe somewhere in the middle you know, I'm like, no, but I don't even need to e lunch. And she's like, okay, but maybe just take like 30 minutes. Just go outside, you know, and as soon as we started to structure the calendar exactly what you're saying, like it really. And aligning with my family calendar and all that stuff, I think it's, that's really good advice and, and finding that routine because, you know, you, you, you, like you said, you're doing all the jobs really, and, and figuring out how.

To either wait, you have a weight of. We have 350 people in the company either way, I've got 150 people whose jobs and livelihood and upside depend on what happens here. And so, like, I have to recharge so I can give them my best.

Yeah. Okay, last question for you. Knowing everything you know today, all the experiences that you've had, everything in your career, what is the one piece of advice you would go back and give yourself before you started your first job?

I would say enjoy the moment as you're in it. There were some really stressful times early on that I had no idea how in the world we were going to get through. That doesn't mean taking the foot off, off the electric pedal, by the way, but like, I've, I've had that. I've gone through the process of building a business, selling it, and there's, there maybe there's some. It's kind of like the nostalgia of giving birth. Like, know, my wife was like, oh, you know, we had, she had this great pregnancy. I was like, I was there. It looked really, really hard what you were doing. Right. And so just enjoying the, enjoying the moment. Building a company is one of the hardest things you can do, but enjoy the moment, enjoy the people.

Great advice, David. Thank you so much for doing this with me. I, I've been looking forward to this episode. So thank you for doing this. A lot of good stuff in here for, for founders and, you know, employees at early stage companies and people who want to be founders. So thank you very much.

Thanks, David.

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