Jason Smith, Klue - Founder Journey Series, Episode 6

Today on Founder Journeys, it's the sassification of everything, the power of data, the freedom of data to move between applications using APIs, and that oh shit moment when you realize we're just about to raise our series A and everything's shutting.

Down because of COVID 3, 2, 1.

Hey everyone. We're back at it again with another episode of Founder Journeys. Today we've got the man, the myth, the legend, Jason Smith. He is a five time entrepreneur. He's the CEO and founder of Clue, a competitive intelligence platform for the enterprise sales industry. They were recently honored as a Deloitte Fast 50 company to watch. They just raised another big round of investment and are hiring like crazy. But prior to Clue, Jason was president of Vision Critical. Vision Critical is a customer intelligence company that he grew from a tiny startup to over 500 person marketing leader. He's also vice president of Electronic Arts. All the gamers in the audience, you know, ea Jason was a VP there for quite a few years. He's also co founder of Columbus Group, 100% web applications pioneer that was acquired by Telus. He recently received Ernst Young's emerging entrepreneur of the year award. Lots of other accolades, but some fun facts about him. He took a gap year and he traveled around the world with his family. He went to Egypt in the middle of the revolution. He's planted over 100 trees or sorry, 100,000 trees. He lost the tip of his baby finger while backpacking in Thailand and he dedicates time every week to helping entrepreneurs. He's a mentor advisor at Launch Academy. He's a mentor advisor for me. He's an amazing human being. Please welcome Jason Smith to our show. Jason, come on. Please tell yourself that I haven't covered and maybe dive into Clue itself. What is Clue? What's the competitive intelligence industry? Give our audience background about the industry that you're dominating here.

Right. First of all, that's kick ass.

Welcome.

Thank you. Wow, that's awesome. It's better than my mom would do. Thank you. Yeah, Clue's been a fun journey. It's, you know, like every startup it takes way longer than you think to get to the point where you've got the real traction and some level of success. I think we're on our way there. The round that we just raised was a 50 million US round. So it was a nice big one from a series a standpoint that helps give us the fuel that we want. And we actually, that's a fun side story raising that. In the middle of COVID we literally kicked off on March 16. But the company itself is focused. Yeah. On competitive intelligence. I won't go into a whole sales pitch, but effectively my challenge at Vision Critical was witnessing a sales team that was being corrected by very educated prospects to whom we were pitching Vision Critical for. And they were saying, actually your competitor does do that when we were making claims that the competitor didn't do that. And that becomes a very awkward situation. So I started looking around for something that could basically put what my competitor was doing on a continuous insight dashboard. And there's nothing out there.

You basically scratch your own it. You had a chain in your current corporation and as you moved on you decided, hey, this is something that's worth solving.

That was a big part. And it's, you know what? And that's true of most startups, Ray. I find like it's, you gotta, you gotta have something in your mind that's bothering you of why isn't there a solution to this? And then you go through the process of there must be a solution to this. And then you do your research and you're either kind of emboldened by your vision or you realize that you might be a little late to the game. But that was certainly the case in Clue.

Yeah, that's again, it's part of being an entrepreneur. You want to solve problems, you want to solve challenges. Most first time entrepreneurs tend to focus on B2C business to consumer products or challenges because that's what they know, that's what they're faced with. But you are also an investor. You're somebody that's been around the industry for quite a while. You know that the B2B companies, it's the unsexy businesses that really have the chance of being a big success and are easier to kind of get success metrics off.

Yeah, I think your odds are a lot better. Like if you talk to most VCs finding that right, B2C winner. There haven't been that many huge B2C companies in the past. We know them, Snapchat, TikTok, others, but it's like there's not that many. Whereas in the B2B world there are a lot. You have to find a problem that a business has and you can solve it. And I think that world of point solutions is increasing. I think the last number I heard was over 150 SaaS applications on average, inside the average business. That's a lot of solutions. Right. And before it was kind of big platform day and now it's like if you solve something for one particular division or one particular group or one particular title really well, they'll pay you for it.

That's an area that you fall into. So that's a really great point there that within an organization, typically there's over 150 other SaaS services that they subscribe to to help them operate their business.

That's it. And like my thesis was, and it's a bit of a counter thesis for some, I think we're not even, we're not, we haven't even gotten started. I think we're going to sassify pretty much everything and there's going to be, you know, greater point solutions. But I think underne all of these is data is transferring between all these point solutions so it can talk in a way that it couldn't before. Right. APIs make that possible. So you're not locked in these data silos. So it's okay to have a bunch of solutions so long as some of that data could move into Salesforce or move into Oracle or move into ERP solutions or into reporting solutions or the data lakes and the snowflakes so that you can actually pull out what a macro lens of all the data would be across all your apps. So my view is, yeah, that continues. And it's all about scratching that itch. If you can solve a problem for somebody that they're doing manually and spending a bunch of time on, and then ideally not just the time savings, but back to some kind of revenue gain or an expense saving, then you've got this combination of it saves me time, it's easy to use, and it makes the company money or saves the company money.

This is a very, very different landscape today than when you first started your entrepreneurial journey. What is it? What's different today? Like going from your first startup to your fifth, how did you approach things differently? What made things easier, what made things harder?

So when I did my first startup, I was your classic straight out of university, I want to start a company. And this is back when, like, it wasn't cool to start companies. So like I went to Sauder ubc. I graduated with a business degree. My parents were like, okay, you're gonna get a job at American Express or some big boy company. And I was like, I'm going to start this company with two of my buddies and they thought I was crazy, wasting my degree on something again. It was back when it wasn't cool to do entrepreneurial stuff. So my theory was like, look, I'm young, I've got an idea. I was big into, I'd Say I was interested in what the web was doing and it was kind of emerging back then. It was like early days. Like I think there were like five people on the Internet in total back when I got started. It was super early and, and we were kind of, I had a very geeky friend and myself and we just thought that people needed back then websites and literally we knocked on the doors. If you can imagine this Ray. We knocked on doors of companies like Telus and Verizon and like telcos like that and going, hey, I think you need this thing called a website and we should build it for you. Like imagine that, that's what we were pitching way back then. So, you know, the web's changed a hell of a lot since then. There's a lot more people online, there's a lot more bandwidth online. Like it was dial up modem days back then. But I think the consistent theme with somebody that thinks about a startup today is just looking at what was going on and you're in the middle of it and going, I think this feels like something that people are going to need. Why don't we build something towards that need and just see. And actually, you know, one of the things that I find different from startup then and say my fifth startup now is, is that I'll call it the youthful naivete. That was helpful to not know how painful some of it would be frankly, because you just go into it, you're like, that seems like a good idea, I've looked around, I'm going to do that. And you just go forward and you don't see all the brick walls. As you get older and you've hit your head against enough brick walls, you start to notice the brick walls a lot more. And so that becomes a bit more of a challenge is to make sure that you still look for the loose brick in those brick walls, having seen a lot of them. Whereas in the early days you're kind of like, who knows, let's go do this. And that was what our first company was. It ended up being successful. I think maybe that's the other benefit is if you're successful in your first one, you've got this other naive belief of this is easy, hey, this is your first time, you win. And in our case, Telus bought us for double digit millions and we were young, in our 20s and we thought this stuff was easy. And then you realize there's so many other factors that go into it. Like our timing was good, the people that we had attracted were good, the space that we were in was good. So there were so many other factors that came together for this why now moment to make it successful. My next two businesses were not successful at all. You know the one after it, I went to San Francisco, got together with two Harvard MBAs. One of them we convinced to drop out of Harvard to do this startup. And this is like the dot com era. And we thought this huge idea was awesome. Leveraged the Harvard mafia to get into all these VCs looking to raise $20 million on the back of a PowerPoint and it was a total failure. Compared like the come out of university with two buds, put five grand on a pot buy max and just go and try and see if you could do something. It was a much bigger shoot for the swing, for the fences. But also with these connected Harvard MBAs, compared to what do we know here in Canada and Vancouver, what are we doing? And it turns out that you need a lot of other things to come together, not just the network to make a business succeed.

With experience comes wisdom and you're able to look back and realize, okay, there's a lot of luck involved in all this. But also the you go back to the naivety of you hit a brick wall, you just want to pound your head through it and force your way through it. Whereas if you are experienced, you're able to sit back, say I actually see that brick wall coming, how do I avoid it, how can I walk around it or how can I get over it as opposed to try to go through it. But I go back to it's the big fish small pond syndrome as well. You guys were a big fish in Vancouver. You got acquired by a big telco that's local. Double digit millions return. Okay, hey, we can bat pound for pound for the big boys. Let's go to San Francisco. And then it's a totally other different market out there. So how did you guys, I guess did you recognize that right away and if so, how did you adapt? Or did you turtle up and decided not coming home?

It's a good, I don't know if it was the turtle up is a good analogy, maybe a good analogy. I don't know. I think what it was is coming straight out of university. I honestly, I just didn't know what the level of exceptional was. I didn't know what really good looked like. And again that was part of the benefit. You could just hop in and just go and nobody told you that you were doing it wrong. You shouldn't go into business with your friends. You can't do it. I'm bootstrapped.