Rob Schoeben (Startup Advisor/Board Member/Former Tech Executive)

Hello everyone and welcome to the 24th episode of the Trojan Venture Podcast. I think this is our first episode of December and frankly probably our last given the busy holiday season. But I can promise that today's episode will make up for, I guess the entire month of December. So today I'm really excited to welcome Rob Shoban. I first met Rob as a sophomore at USC where he was my professor for my first ever entrepreneurship class. Rob's teaching really sparked my interest in venture capital and entrepreneurship, so I'm really stoked to have him on today. Outside of the four and a half years he spent as an adjunct professor at USC's Marshall School of Business from 2019 to 2023, Rob has spent many years as an executive at several well recognized tech and advertising companies. Not too long after graduating From Duke in 1988, Rob became a senior partner at Ogilvy and Mather, a well known advertising, marketing and PR agency. In 1995, Rob became a Director of Marketing at Microsoft where he spent almost eight years. In 2003, Rob moved from Microsoft to Apple where he worked for six years as Vice President for Applications and product marketing. In 2014, Rob became the Chief Strategy and Marketing officer at Carbon, a 3D printing company which has worked with brand names like Adidas. Rob has also spent the last 11 years as a startup advisor for founders at Distillery LA and is currently a board advisor at Heirloom, a direct air capture company, permanently removing CO2 from the atmosphere. As you guys can probably tell, Rob has had a wide range of experiences to kind of tell us all about. So really excited to hear more about his personal and professional journey. So let's get him on the call. Hey Rob, thanks for coming on the show. My pleasure. Really excited to have you on. I just mentioned how I actually had you as a professor in one of my entrepreneurship classes. I guess this must have been two years ago now. So time flies.

But yeah, I was trying to figure out which class you were in. No, no offense, but the classes do tend to blend together.

They are blending together for me now even as senior, so. But really excited to have you on and kind of go through your career and both professionally and teaching and so wanted to start out at the beginning. You went to Duke and wanted to hear about what was your kind of your plan coming out of undergrad. How did you think about what your career was going to be like and how did you proceed?

That's a great question and I'm sure on a lot of people's minds as we head into the second semester for some people, senior year, even junior year, needing to think about it. For me, I kind of want to just go back a little bit and talk about when I went to college, right. For context, I went to college in the 80s, right? And so I was going in, I was kind of confused about what I really wanted to do. The one thing I knew is I wanted to get the heck out of Dodge. For me, Dodge was southeastern Wisconsin, and I just wanted to get as far away as possible. And my, my rubric was I needed to be away, but I needed to be able to drive home for winter break, right? So that kind of took the west coast out of the mix. I ended up at Duke. Loved it, and it was great. But when I went, I did a few things. First is I applied early admission to the engineering school. Why? I think mostly just because it was the hardest to get in and I wanted to learn how to do hard things. And if I was going to apply early, I might as well get in onto the one that's the hardest to get in. I can always switch, which, oh, by the way, spoiler alert, I did switch out of engineering by the time I was done. Second thing is, I figured it'd be computer science, right? I had all these fantasies at the time about designing artificially intelligent computers, right? We were actually talking about AI back then, but it was really just getting a computer to understand our speech and to respond. And what it turned into, obviously very, very different. But, you know, I obviously didn't follow that career path because I was decades too early, right. To be honest. And the third thing I did, I don't know where the heck this came from is I decided to be pre med. So going in that, what was the reason for that? Well, you know, I grew up in sort of suburbs, slash rural southeastern Wisconsin. I looked around and the people that made the most seemed to be doctors. And I felt part of the American dream was to try and make more money than your parents. And so I figured, well, that's the easy thing to do. It turns out that most of the most successful people that were in my community actually started and ran their own companies. But because I didn't know what entrepreneurship was back then, that didn't seem actionable, right? So I was just going to go apply early, be in the engineering school and be pre med, right? It took a lot of, you know, physics, chemistry, calculus kind of classes in the first year. Took my first electrical engineering class as a sophomore. Absolutely hated it. Filled out the paperwork immediately to switch back to liberal arts. Still hung on to computer science and then added business emphasis. Duke doesn't have an undergraduate business school, but what they do allow you to do is as a computer science major, I could take up to eight classes in any field. And so I took eight classes out of the graduate business school and that became a really nice combination for me. So all I, all I knew at the time was that somehow when I was done, I wanted to live at the intersection of technology and business. And I knew I didn't want to write code for a living. And, you know, my thing wasn't overwhelmingly sophisticated, but I knew that computers would be useful. And remember context, right. Again, I'm a lot older than you are. I went to school in the 80s. The, you know, IBM PC came out in 81, the Mac came out in 84. I'm graduating in 88. This is all new, right? So this is kind of like blockchain and AI for, for your generation. I know just something, something would happen there and I, and I, I wanted to be part of it. So that's, that's how I approached it. Now you're actually, your question, that's just the backdrop. Your question is, what was my plan coming out of college and what's the interesting thing for me personally was I didn't have a plan, right? Because something happened earlier than graduation. So I had this situation where my parents struck a deal with their three children. That is they will pay for state education, University of Wisconsin, anywhere. But beyond that, if you choose to upgrade, which I'll call it that, which I went to a very expensive private school. I had to pay the difference. So for me, the notion of the burden of college was pretty significant. I had some scholarships that paid for about a third. My parents paid a third, but the other third was 100% on me. So these summer jobs, which you guys now call internships, were really important to me. Right. The first one I did was very pre medi. I did, you know, I was a possum surgeon and did some beta analytics around drugs on the biliary system was kind of interesting, but it ended up not being my path. Second summer, sophomore, junior summer, I came home, I wanted to just make as much money as possible, right? And there were a fair number of road construction jobs readily available to me and they paid pretty darn well. And honestly, I was thinking about it, I actually had a very specific school that I was going to transfer to, to if I didn't make enough money. And so. But then at the last second, I got an interview with a very small Direct marketing agency in Milwaukee. And it just sounded really interesting, right? They were launching the very first frequent flyer program for Midwest Express, which later got acquired by Alaska Airlines. They had the System 36 computer. It's an IBM mini computer. And everyone was trying to figure out, you know, as we're moving towards personal computers, you know, how do you make these things work? And they thought that I'd actually program the thing. I only did about a week of that before I turned into an account guy. But at the end of the interview, and I was pretty excited, he said $3.25 an hour. My heart dropped into my stomach, if not somewhere lower than that. And I was mortified. But in that moment, I don't know what came over me. I just. Something in my gut, my instinct said experience is more important than money. The money will figure itself out somehow. And I said yes, right? And so somehow I now was working in a real business. And I dove in head first, you know, I. I gave this my all. During that summer, we actually had a. A class within the. Within the summer job where he taught US Direct Marketing 101. All of a sudden, I was in charge of the freak of flyer program. I was charge of, you know, little Train Club and some other things. And at the end of the summer, they were starting to panic because I was doing real work, right? And so my advice, if you get an internship or a first job, even where you're doing real work, where they can't afford to lose you, that something's good's going to happen, right? So to their credit, right, Little small direct marketing agency, no one knows about stock options and those kinds of things. They took me aside at the end of the summer and said, hey, we got an offer for you. I know that, you know, you took a bet on us or whatever else. Here's the deal. You work for us for the next two years from Duke, including the summer in between, and we will give you $5,000 per year directly to Duke University to help pay your tuition. The only hook is that when you graduate, you have to come back and give us one more year. If you give us one more year, the loan is written off, right? Consider it paid off. If you choose to go to Morgan Stanley training program in New York, you need to write us a check immediately for $10,000 on the day you graduate. Like, oh, interesting, right? So I had this work study job in the medical center at Duke. Happy to turn that down. I took a bunch of timesheets and a luggable compact computer back to School and I worked pretty much a full time job while I was also doing all my studies that year, came back and worked this summer, continued to advance my position within the agency and continue to work that senior year. And man, did I not want to come back to Wisconsin. Right? Remember that high school kid wanted to get away, but I figured, you know what, I'm actually further ahead in my career already than all these other job offers I'm getting. I came back, I bit the bullet. I even went so far as to move in with my parents and I started paying back a $500 a month on my loans to really try to get debt free by the time I got out of the situation. And so it wasn't really planful. I know that listeners would hope that I could just lay out a blueprint, but it kind of was more serendipity, which a lot of things in life are. But if I go back and answer your actual question, I'd say my plan was to really pause the insecurities and have confidence in my ability, be willing to work my tail off, work harder than anybody else, swallow my pride if necessary, right? I went back to Wisconsin. I didn't want to, I sure as heck didn't want to move in with my parents and finally, and most importantly, trust my gut, right? I, I took a chance. I, you know, I could have made three times as much money doing construction, but I don't know how that would have helped me. Although, you know, that first job, you know, had a lot of interesting dynamics. It allowed me to do so much so young that by the time I went to my second job, I ratcheted up three levels. Just because a company that no one else is ever going to have heard of gave a chance on this kid and let me have way more responsibility than quite honestly I probably deserved. But I took that responsibility, I said yes and I got it done and then launched that into the next thing, into the next thing.

And first of all, amazing background story, but the immense amount of experience that you got firsthand, I'm sure helped you kind of accelerate your career as you went to more brand name players such as Apple and Microsoft. So during your time at Apple and Microsoft, what were some of the most impactful projects you worked on? And maybe kind of a second question of that is how did your first job or your internship experience kind of help you with those projects?

Okay, that's a great question. So let me, if you don't mind, I want to break that into two parts because Microsoft eight years, Apple six years. There's a lot of stuff in there. So I'll take the Microsoft one first and actually start by in a way answering the last question in a way. So I got from that first job at this company is called Communique. We spun it out into a startup called Retail Target Marketing Systems. And essentially we were doing database marketing before that became the foundation of all marketing today. We basically took to simplify, we took your credit card information from Macy's and we figured out who wants the junior mailer and who wants this other stuff targeted but physical mail. That is the foundation of Internet marketing. But we were not the cool kids back then. We were the nerdy, geeky analytical ones and, and the cool ones were doing, you know, TV ads, you know, to just make you feel good about drinking Pepsi. But anyhow, that's where I started. But that allowed me to be considered a database marketing expert, which got me into Ogilvy and Mather Direct in Los Angeles, which allowed me to be in the agency environment, which allowed me to then build the Microsoft account into a really big account, right? And so I was working at Ogilvy in LA on Microsoft for six years before I joined Microsoft for another eight, right? So starting in 1989, I was working Ogilvy LA and I managed the Microsoft account in a variety of other high tech accounts. But Microsoft was the big guns. And I spent two days a week in Seattle and I was part of the team up there. I was also built a team down here. I was lucky enough because we were growing so fast to be able to hire a bunch of people just like me. A bunch of young people that wanted to advance based on merit, not on seniority. And everyone got a lot of promotions and a lot of raises and a lot of lot of good money. And we worked really, really hard, right? And it's one of those things that I hope comes back in favor because in these days, because of the pandemic and everything else, I think the concept of work is a bit broken. I think things will be better once the pendulum swings back. But right now it's all very confusing, right? Do you actually just want to work? Are you phoning it in? Remote hybrid, blah, blah, blah. But back then we all worked together. We worked really, really hard. Work turned into happy hour, which turned into dinner. And the lines between personal and and professional were completely blurred. I had no other life, but I enjoyed both my work life and my social language was all in the same, right? We pulled all nighters. We've got great stories about, you know, the New hire I had who crashed the rental car that he took out of my name on his first day of work. It's just classic stuff, right? You don't, you can't do when you're married and you're later in life. But so I, I strongly encourage the analog of that, which is just find something you can pour yourself into and worry about balance a little bit later. Just early on, just get in there and just get stuff done and blow people away. But anyhow, back in the Microsoft days, the story I want to pull out of that whole era, which is actually both the agency era and the Microsoft era. I could talk at Microsoft about how we took on Word and Excel and all this other stuff about the Microsoft business. But for me, what was more interesting, especially because I taught entrepreneurship later in life, was a story that relates to entrepreneurship in a corporate environment. Right. Because most people think entrepreneurship, oh, I gotta start a company. Yeah, right. Here we are at Ogilvy. I built this, you know, this account that's paying the agency 7, $8 million a year in fees. The agency is really thrilled, but we're serving the business from Los Angeles and we're kind of expensive, right. And so not surprisingly, there's all these little piranha agencies in Seattle saying, give me a project, give me a project, give me a project. They're calling anybody that know that, that they know within Microsoft that has a budget and say, just let me do a little, little, this little side project, that little side project. Well, you can imagine from my perspective, the agency's perspective, that's very threatening, right? So they could legitimately create a, a body of work that is maybe less quality but is so much cheaper that it's good enough. And then separately, if you're are advocating on behalf of Microsoft's marketing machine and the messaging and the contact management, the number of messages that might be conflicting and what could happen to the brand. There's a lot of bad things that could happen without, when you loosen control. So what I decided to do is I decided to not let that happen. So I'm running this account. We're flying up all the time. We're servicing all, all this business. But I keep hearing all these little niggly things about cost and this little project and whatever else is. All right, here's what I'm going to do. Oakley Mather was owned by a company called wpp. Still are. It's a holding company that owns a bunch of agencies. Turns out they own another agency, a smaller agency in Seattle called Colon Weber. Didn't really know this agency, but I knew they existed. And more most importantly, they were in Seattle. Right. Because that was the attribute that I really needed. And so I said here's the deal. So I went back to Microsoft and said, how about if I create a secondary level of service with a second agency in Seattle called Colon Weber Direct and they will be 50% of the price of our main business and they'll be earmarked only for the low end work, the kind of stuff that's, that's at risk. And I will, you know, streamline the process. So there'll be things that'll be twice as fast, half the price, but still Ogilvy quality. And I'll ensure that because I will sit on top of both of the teams. And so I will be the bridge across the two. The only deal, the deal breaker or the clincher is you need to be exclusive. You need to stand up and prohibit all the little product groups from spending these small budgets on all this, these piranhas out there. You need to commit the second, essentially the second contract to us. So we had Ogilvie made the Direct Cola, Weber Direct. Both of them were me and they said yes. And the business just continued to grow as they grew and all those little agencies started barking up another tree and eventually Amazon launched and they could go work for them but they weren't in my account. And so it's just an example of even though the product and the business is providing marketing services to your client, it's still a business and being entrepreneurial can still happen even if you are, you know, within a large agency, within a holding company. And quite honestly, you know, your New York office doesn't even know what you people do. But I had a P and L to protect, right. And so you know, I had to be creative. And you know, again I think that's just a great example of entrepreneurship is not limited to the startups of the world.

And now I kind of want to make a transition into your time of teaching. Obviously that's how we first met and you teaching entrepreneurship classes at usc. So what made you wanted to get into teaching specifically, you know, what type of work experiences, whether that was at Microsoft, Apple or before, kind of inspired you to go down that route.

Yeah, so we kind of jumped past Apple. So let me just do a little bit of Apple. So I left Microsoft. My story was Microsoft from the agency side. Then I spent a bunch of years at Microsoft and quite honestly Microsoft people back in those days, it's kind of hard to imagine today Although they're, they're, you know, they're feeling their way again. We were kind of bred to be a little arrogant, right? We thought we knew everything about everything. We thought we were the best. And so when a marketing guy becomes a free radical and is looking for a new gig and he ends up landing at Apple, I thought I was just going to come and do a bunch of work. And so I got to work very, very closely with Steve Jobs for almost six years, right? We were meeting an hour a week on marketing. He'd get all the VPs of marketing together for an hour a week and talk about just doesn't matter what your day job is, just anything marketing for the company. And then twice a week, my. I was in charge of applications and Internet services. And so those products, we would have a product review meeting every two weeks for two hours or more with Steve. I did that for almost six years. And so the quality of my game, I felt like, grew more than ever during this period of time because I got to actually study from a master, right? It felt like a master class. When I was at Microsoft, I worked for, you know, essentially, not directly, but for a software architect in Bill Gates and a, you know, sales guy extraordinaire in Steve Ballmer. But neither of them did my job. And even though Steve's in a different league, what he was asking me to do for my little group of products was be him when he's not available, and when he is available, make sure I provide all the raw materials that he needs to look good, right? Whether that be a killer demo, all the assets for iphoto or, you know, keynote slides or whatever that may be. So I learned the state of the art after I already thought, thought or my people thought we were pretty good. And so I felt like after Apple, I really wanted to give back, right? Which is a global comment. I wanted to give back both on all the things that I've learned professionally, but then I also want to give back, right? From a do the right thing, right? So we always talked about, you know, putting a song, a thousand songs in everyone's pocket was a great thing to do. Well, you know, it's not exactly giving back, right? It's changing the world. It's not giving back. So I did a couple things coming out of Apple. One, I got involved in venture philanthropy, which is basically taking the VC model and mapping it to philanthropy to try and do a very rigorous job of selecting and supporting organizations that we're trying to do good. Got involved specifically in education track within that initiative with an organization called SB2 in the Bay Area. And then I also started a nonprofit with my wife, sort of like the second or third startup in my history, and it was to provide mental health services in school, but it was her thing, and so I needed my thing. And so where I invested the rest of my time was to mentor. It started out very, very casually. Just I'd get calls from younger colleagues just asking for mentorship or whatever else, and we started talking and that led to, you know, advising and other things. But somewhere along the line, I decided, you know, I actually want to do this a little bit more formally. And so I got an opportunity to guest speak at Stanford in the business school, and I really liked it. You know, I had to figure out how to translate what I knew into frameworks and models and ways of thinking, because I never. This wasn't a book learner thing, right. I never got an advanced degree, if I'm being honest. I've only taken one marketing class my whole life, right. So I come out of the trenches. I'm an experiential guy, and I set my sights on being able to teach experience. And so I started in the Viterbi startup garage and I was an entrepreneur in residence for the engineering school there and helping, you know, teams, either alumni teams or professor teams in that capacity. I raised my hand and was an adjunct professor for the NSF I Corps program, which is basically taking deep science, deep tech startups and trying to help them understand the rest of the business bit. Then I raised my hand and basically just reached out to Marshall and specifically the grief center and said, if you ever have a class, give me a call. And of course, they called me one week before school started in January of 2019, and I quickly scrambled to build that class and I ended up teaching it for four and a half years. And it was a way that I sort of think that a lot of what I do is teaching. That's sort of at the youngest level, where I'm really just trying to inspire people about entrepreneurship and the process and some of the skills learned along the way. Mentoring and advising is sort of people who are similar, except they've either graduated or quit school and they have to pay for their mortgage. And so it's a little bit more serious. And then all the way up to sitting on a board where you've got fiduciary responsibilities. And it's not just advice, right? You're really on the hook for the whole company now behind all of that, I had the, you know, voice in the back of my head, which is voiced by my mother, who, since I was very young, said, I don't. This work thing you're doing is great, but your true calling is teaching. And I don't know exactly what she means by that, but. But that resonated with me. And every time I. I got into a situation where I was trying to pass on wisdom or knowledge or stories or advice or counsel or teaching, I liked the feeling of it. Right. The fact that you could take things that are gleaned from my journey and somehow accelerate the next generation on theirs. That seemed pretty cool, right. And from an engineering perspective, kind of efficient, right. To take, okay, this. This whole career, and maybe I give you a nugget that could save you a year. That'd be pretty amazing. So anyhow, that's how I got into it.

And just to follow up there, because it was amazing to hear kind of your direct exposure to Steve Jobs and how that kind of led into teaching. So one, I guess, question would be, people often say, you know, the way to learn is to be around really smart people, but I think that's kind of only on the surface. So when you were working with Steve Jobs, what were the things you were doing to try to enhance your learning experience or soak up what he was saying? I think a lot of that comes to, you know, when you're in school, you might have great professors, but there's an extra level to go to. How can I get the most value out of this class? How can I learn the most from this experience? So what would you say were the things you did to kind of really enhance that learning experience for you?

Yeah, I mean, that's. The context shift from education to work is. It's. The learning is a byproduct. It's not the point. Right. So the learning in a work, any work environment, but clearly, in my experience at Apple, was very much the experience of doing it either for him, with him, or judged by him, you know, So I remember the very first time I had to do a keynote presentation, right. I had to present to 2500 people in Vegas on a bunch of, quite honestly, professional products that I. I wasn't very deep on. Right. I didn't come to this job with a, you know, having produced a movie or having been in a band or what. But yet I managed music apps, photo apps, and video apps, both at the consumer and professional level. So I needed to be on stage, I need to be Apple caliber. And quite honestly, two months prior to the event, I thought Steve was keynote, right. So then he broke the news to me that he wasn't going to do it. I had to do it. I'm sorry, I got to do it. And there's a lot of dynamics around that that are complicated. But the other thing was I knew that he was going to have agents in the front row who were going to call him immediately afterwards and report back how it went. So I knew I was being watched or whatever else. So one, I had to step up. I had to see what Apple caliber Apple process was, what this, you know, etc. And then to his credit, he went out of his way to make sure not that I was successful, but that I had the tools that I needed. So I would never forget. There was a, one of those VP of Marketing meetings I alluded to, which was an hour every Wednesday. And in one of those meetings he let everyone else know that I was going to do the keynote. And I was still a relatively new Apple person and I was, remember, I was former Microsoft. There's a bunch of Apple people that hated the fact that I was former Microsoft because if you go back far enough, they were at war. I think Steve saw beyond that, that that war is irrelevant. He had much bigger fish to fry. But there were some, some people that weren't so happy that I was there and that this early into my tenure I was going to do a keynote and that they really wanted Steve to do it because it was safer. He basically in that meeting just said he can handle it. And we started to work on how I could hold the audience for two hours and essentially taught me his tricks around how early in the presentation you have to have something super sexy to engage them. You got to be able to, you know, last two hours. So it's okay to have some dips. Find a way to spread your dips out. You got to bring your audience back up. And we just architected this whole thing. I've never done a two hour presentation before, right? You think about a pitch, it's just like five minutes, it's two hours. So I, I knew that I had sort of the, the, the keys to the kingdom from that perspective. And also I'd been through enough of his rehearsals that I know what I had to do when I was trying to act like him and so never tried to like mimic him. But there are some things that work right. So when you get, when you're really, really disciplined about the technology and you make sure you have a backup for the backup for the backup. You have demo scripts that make sure that you touch only the parts of the app that are rock solid and you know exactly how you're going through it and scripted to the word that you, you know, you script out what you're going to say, but then you get so comfortable with it that. That you go off script. But it's still natural. You rehearse with people who know this better than you, and they give you feedback and you watch their reactions and you. You leave nothing to surprise. Right. The level of preparation that Apple does, you know, which is established by Steve, it's unprecedented. And most people take for granted the fact that perfection usually comes out the other side. It's mostly because no one else would put in this amount of work.

Right.

It's insanity. But the value of the product at the end is so much greater than what most other people bothered to do that it was worth it. And so those are the kinds of things that you learn. And it's. It's osmosis, it's experiential, it's seeing him do it. Now I got to do it. And it was kind of cool because I got to help him when he was being him. And then again, I use all that learning to do it on a smaller scale when I needed to act like him. Right. And so there's sort of the sunshine, which is if. If there was a bunch of sunshine, he would probably want it. Right. If there's any kind of shadow like, oh, this is just pro apps in Vegas, he'd dish it off.

And.

But if you dish it off, the bar didn't go down. Right. And so I have learned since then, and I've applied it since that preparation. And I never knew how far one could go, but preparation is so valuable. And. Yeah. And so if we talk at all about the Carbon experience is the first time I'm working in. Okay, go ahead.

So I was just going to transition to that because I think I really wanted to ask you. One of the things I remember most about your class is you describing your TED Talk at Carbon when they were still a very new company and the manufacturing was very technical and your ability to be able to kind of not dumb it down, but to make their technology understandable for a mass audience. So what do you think you did during that presentation made it such a success? And you can maybe kind of tie that back to the lessons you learned doing the keynote speeches at Apple.

Yeah. So again, it all. It all goes back to the realization of what it takes behind the scenes. And at Apple. Initially, I was a little resentful about what I was expected to do. You know, I'm fairly far into my career, I'm a vp, but I'm not going to be on my hands and knees working on the computer. Oh yes I am. Because that's what someone at Apple at that level does. Because they make absolutely sure that nothing is going to fail. And if it means you have to do it yourself and you've got to load software off a flash drive yourself, you do it. So you do whatever it takes and you prepare for all possibilities. And so when I think about the process of that TED Talk, it all starts all the way at the beginning, which is the idea of doing a TED Talk for a product launch is kind of a little bit at odds, right? Because it's not a marketing show. It's technology, entertainment and design. It's supposed to be provocative to get people to think. And so we needed to get them to pick us, which is their whole process for that. They have scouts that scour the universe and interview people and try and determine if you are a fit. So we had to convince them that we were. And even though we were going to launch the company via this TED Talk, that we were not too marketing. And then we had to negotiate an agreement that said we're not going to let anyone know any of the information we're going to disclose until we hit the TED stage. And so I thought that was enough. And then they upped it another level and they said, oh, and the other thing is you can't ever show a demo outside, know your conference room, your company walls until the TED Talk. And oh by the way, you have to do it during the talk without a net. Okay, so just for context, this is a company, we have no product, we have a prototype. It's a really ugly machine, but it works and it makes things right, it makes things really quickly. And that's what was really cool about it and why I joined the company was this is a company that has the promise to revolutionize 3D printing which even though, I mean at that point it was like 23 year old technology, but it was still hot, people still believed in it, but current technology wasn't good enough. And so we, we agreed to those things and so now we have our slot. Then I also had to go back and negotiate. They wanted to give us six minutes, I needed nine. Right? So then we had to get nine minutes. It's still not a lot of time, but we're going to do a presentation for the first time ever in public. We're going to do a, a print of an object that should take six hours by any other device. It will take six minutes for ours and we will do it on a machine that's not commercially available or anywhere close. The next thing I had to do is I had to convince the leadership team to spend money with industrial designers to make the device look pretty because it needs to be. Again, the whole theory was Apple caliber. And that's what I pitched. The leadership team is we're going to make this an Apple caliber launch, which means we have to do things a certain way. And so again, there were enough fanboys and girls in the group that, that, that was fine, but there were some tough moments, right? So I said, we're going to have to do this. I helped the industrial design contractor design the machine. It cost like $30,000 that I came back and said, we got to buy two because things happen. So we had machine one, machine two, again, a little bit of spoiler alert. Day of the event, Machine one failed. Machine two is the thing that made it in the final video. So thank God for that. And then I spent a couple of months, one on one with the founder, right, the inventor of the technology, to craft the story. And there's stories within stories, and every bit of that had to be, you know, similar to what Steve taught me about the, you know, the two hour curve of how you manage the time. You know, nine minutes is not a lot of time. But there's also very high expectations with TED Talks, right, to stay very engaging and, and be very provocative. And so we architected that very, very carefully and iterated and iterated and woke up in the middle of the night and came up with 2D printing over and over again as a definition of 3D printing, which, you know, the founder had never thought about, but he's like, oh my God, that's the easiest way to think about it. So all these ways to synthesize these complicated things and get them down to, you know, little analogies or metaphors or stories. You know, somewhere in there he talked about how 3D printing, there are some mushrooms that grow faster than 3D printers, right? Well, that little anecdote, you stop in your trice and go, wait a second, I thought 3D printing was fast. Well, they think it's fast, but 24 hours isn't fast. 24 minutes is fast. You want to see fast? You know, look stage left, right? So we, we built that script over and over again. And for the launch, again, it's gonna be Apple quality. So I hired a top Notch graphic design firm out of Portland called Cinco Design to help support the presentation, make sure that it's visually impressive. We, we then also went out and did all of our scientific research and we, we tested that six minute print that I claimed to take six hours and prove that it took six hours. We printed the exact same part on every, every device available in the industry at the time and we had all the statistics available on the website the second the TED talk ended. Right, so you get the theme here, right? It's cover your ass, cover your ass, cover your ass, if I can say that and just make sure that you go overboard. Right. And so we even had a video of the demo in case both machines failed. Right. We had a video in the can if they would have let us splice that in if we had a failed demo. I was ready with that too. Right. So it was about rehearse, rehearse, rehearse. We iterated, we iterated, we iterated, we were over prepared. A couple of bad things happened, but the world never knew. And then after the fact, you had to work with the TED organization quite honestly to make sure that it makes the website. Right. Because I didn't realize all TED Talks don't make the website. So I had to assure them that the audience, they were pretty convinced because it was pretty good. But to make sure it got on the site, to make sure they had all the assets they needed, et cetera, et cetera. So just service, just provide unbelievable service to make sure you achieve your objective. Because the only thing that matters was it was an amazing talk and that a ton of people got to see it.

So you mentioned a lot about the importance of crafting a story for your pitch at Carbon. And I remember this was something you talked a lot about in class and really emphasized to us when we were building out our kind of our fake companies was about the importance of having a story and being able to tell that in an effective manner. So what would you say are the main ingredients for crafting a good story for your company? And then what are the ways that you should effectively communicate that as an early stage founder or whatever that is?

Yeah, I mean, I think one of the anecdotes that I borrowed when we talked about this in class was you can't tell a great story if you don't have a great story to tell. Probably the most obvious and straightforward thing that you could say, but too often people don't put the work in to make sure first and foremost that it makes sense. Right. One of the things That I find is so useful in helping entrepreneurs is just to force the team to go through a process of trying to go from beginning to end to tell a coupling, to tell the story. We'll decide if it's compelling or not to someone who you've never met before or who doesn't know your business or certainly doesn't work for you. Because in doing that, you have to make sure it makes sense, right? And there's a set of things that you want to do along the way to get the audience nodding, right? It's like, yeah, yeah, that makes sense. Not only does that make sense, but I'm into that. I really care about that. And so the first thing I would say is you have to recognize that in order for someone to take action, and this is true of anything, this is even true for dating, right? They need to understand, they need to care, and then and only then are they willing to take action. And too many people are trying to focus on only number one. And they think that understand is blast all the information that I know. And if you know everything I know, you're going to think that everything that I think, not how the world works, it's not how the brain works, right? And there's this thing called evolution. And as a species we learned how to communicate differently than, than the other forms of human species in that we were the ability to tell stories and help you imagine futures that didn't yet exist.

Right.

I think I've mentioned this in class. Neanderthals are, they have bigger muscles, bigger brains, they're more well insulated. And we kicked their butt, right? Because they got language that was, that was descriptive. And they could say, tell you facts, that's a stone. There is a dangerous predator by the river. But what we did is we said, you know, hey guys, let's get together. Remember the last time we were down here at the river, there were all those nasty saber toothed tigers and they ate, you know, your kid and my kid. Let's not let that happen again. And why don't we figure out a system? Maybe we could have platforms in the trees and if we have lookouts, we have lookouts and we can work together. And if the saber tooth tigers coming, we'll put all the babies in the tree and they'll survive. That kind of planning is fundamental to creating a movement, whether it be a cult, a company, a political movement or whatever else. But to make something happen that doesn't yet exist, you need to be able to persuade people of that. Which is why in entrepreneurship they talk so much about vision. It's really just helping people see a future that you believe in and then proving to them that that future is both necessary, desirable, possible. And because this is a business, usually profitable. Right. And so there's a series of questions and things you want to address. And there's this overly simplified part, which I would call setting the hook. You know, you want to do a lot of stuff, show them your pro forma financials, talk about the team, whatever else. That's nice. But the thing that matters, there's five things up front that matters. First, can you identify the problem in the world or call it the enemy? The thing that is so dastardly and so evil that it is worth doing the hard work of trying to eradicate it. Right? So create your Darth Vader. You know, paint an emotionally evocative picture of your target audience and the crap that they go through and that. And make me feel that it's not okay if you don't do that job and do it arguably, maybe almost always first, you have no right to talk to me. Right? I don't want to hear about your credentials or your office space or who you've hired. I don't hear about any of that. Because if I don't, if you can't convince me that there's a problem that enough people have that it's worth solving, we got nothing to talk about. Right? Second thing is, if that's the case, can you paint a picture for me of a future state of the world where that same person or target audience, it can be an animal, I guess things are so amazing for them. And that's a world that I want to see happen. And I'm going to convince you that you want to see happen. So now we've got the motivating factor. If there's a problem, it sucks. We got to eradicate it. And there's this future that is worth. Worth going for. And at that point in the process, the audience does this thing, which is kind of cool, and you feel the energy in the room a lot of times where they metaphorically go from the other side of the table to your side of the table. Imagine you're in a car, you're driving down the road. They used to be in the street trying to get you to slow down or whatever. Now they open the door, they get in the passenger seat, they buckle up, and they say, let's ride. Now, they're not sure that you can get there yet, but they want to. This care, you feel, the care they care about the problem, they believe and they want the solution. Now. Audiences are pessimistic and cynical, so you also have to prove them that now is the right time to take this trip. Right? Because LA traffic has been intractable forever. Yes, we want to fix it. Yes, it sucks. But what exists in the world today that says that we're actually going to be able to do something about this, right? We're going to talk about teleportation. Is there a policy in place? What are the things that have aligned? How are the stars and the moons align? That this is the episode of Star wars where Darth is actually going to get his comeuppance, Right? And so the classic answer for a VC is that's kind of interesting, let's stay in touch. What that means is you didn't convince them of the why now, right? Literally my license plates on my car is Y N O W. Right? Because it's timing is oftentimes the most.

Important entrepreneur license plate.

It is that and nothing else was available. Yes, I'll stick a true entrepreneur. So then finally you're like, okay, I want to go there. I believe in you. Some, somewhere subtly in this you have to say why us? Right? But I do think that can come later. But then you have to prove that you're not just a marketing machine, right? And so yeah, you spun a great story and you know, this great demo and everything else. How do you prove to me that this is real, right? So show me some customers that are either interested or already paying or at least show this is why there's demos and technology startup. So much is you're demonstrating because that's all you've got at that stage, a solution that you're hoping to convince the audience to believe that customers will buy. Obviously sales are better, letter of intents are better, but I'll take a demo if I don't have anything else, right? It's why there's a demo in every new product launch. Because it's my only way to show you that a bunch of people are going to clamor to this. And then after that, the last thing is, you know, prove to me that this is going to make money, right? Because it's all, it's all well and good, but if, you know, if I prove to you that I can make a ten thousand dollar solution to a hundred dollar problem, we still don't have a business, right? So there's a lot more. But I think that's the core of it is to make sure you set the hook. You Move the audience along with you. You get them on your side and you get them to want what you're wanting. And you play your homo sapien extraordinaire and you paint a picture of a future that the world can't live without.

And I want to speak to what you were saying about how you can't just be a marketing machine. You have to kind of have either a demo or contracts to kind of back that up. And I really want your thoughts on the transition we've seen from 2021, where frankly, we had a lot of marketing experts that raised a shit ton of money with no real products. And now you're kind of seeing a shift in 2023 to more emphasis on profitability and unit unit economics. Do you think that that pendulum is going to swing back to let's try to raise as much money as possible because it's great for pr? What do you think is kind of the dividing line for founders to say, you know, it's great to raise money, it looks good and it's going to help us, but we also need to make sure that we're going to be profitable. This is not something that's never going to be profitable.

Yeah, it's funny, there's like seven questions in there. I'll pick off a couple and then feel free to re ask the other five. But one of my pet peeves is, and I have a lot. I mean, if you remember from my class, I definitely am full of pet peeves. One of them is so many entrepreneurs consider fundraising to be a badge of honor and it really should be more of a acknowledgment of necessity. It's not in and of itself, it's not an achievement. Now, obviously it's a signal, right? So in the world, you're looking for signals of product market fit, or at least product investor fit appeal. But if I could start a company and not have to sell 20% in the first round to a bunch of random people, I should do that. And the best way to do that is to have a business that has all things that I described and is profitable and generates real revenue and doesn't need to like, get eyeballs that we monetize later or whatever else. And we've gone through this cycle. This isn't the first time, Right. We've gone through the cycle numerous times even since you've been on this planet. The dot com burst is probably the bubble verse is the most famous, right? So people running around with just the most crazy business models and they all sounded like well, as long as we get an audience, we'll be fine. Like how? It doesn't matter. We'll figure that out. But as long as we get millions of users to come to our site and cost us a bunch of money, we will eventually make it up on the back end with that scale somehow. We'll charge them something for some, right? And then the answer is you always have these also these panaceas, which is, oh, we'll just put ads on it. Oh, pet peeve number two, right? Oh, we'll just get a lot of users and then we'll monetize them like Facebook did Instagram. We'll just copy everybody else's business model. So I think what's going on now is we're in the latest round of sort of the hype hangover. And on the other side, honestly, I think the venture committee overcorrects whenever this happened. They overcorrect. And so now pet peeve number three is a lot of VCs, especially the lower tier ones, think that it's time to act like a small business bank and say, okay, let me show me your revenue stream. I need to have a, A quarterly P L, et cetera, et cetera. And that's what I'm going to fund. And what's, you know, what is your, you know, what are your assets? No, venture capital is a risky asset class that is supposed to invest in things that we think are going to make a ton of money someday and a whole bunch of them are going to fail and a few of them are going to make a ridiculous amount of money. That's the asset class that it is. So VCs need to continue to act that way. But I do think they're looking for more signal of product market fit. And I think that the lazy ones only want that signal to be revenue. I think that signal is signal. And I think personally, I think that getting a little bit of revenue early and then flatlining is often the kiss of death. I'd rather have nothing and have signal and then take off like a rocket ship. Because once you start with revenue, at least the good VCs expect a slope that's quite steep. And if you're tinkering around, you know, and you've got a few thousand here and you're really proud because you have revenue, but it's not going up, you know, you know, 10x a month, people are kind of disappointed. So I think that especially with AI, people are starting to realize as the hype wears down that there's going to be a small number of very successful platform level providers that are going to make a ton of money. There's going to be a bunch of people at the next layer up that are going to get crushed like a bug and they're either going to get acquired and pushed into the platform or they're going to just get competed out. And then just like every other platform that came before it, there's going to be some real value added applications that we haven't really imagined yet that are going to go up a whole nother level and a lot of them are going to be very specialized and verticalized and they will be okay. And ironically the most impacted organizations are the ones that already have a business but they do a good job of adding AI to make you know, there be higher walls to unfortunately all the startups out there. So I think there's some people in the middle that get crushed. I think the people at the bottom are very expensive but, but they're fine, right? The Google's, the OpenAI and Amazons of the world. But if you are trying to be just I'm an AI company, that's no longer a good enough answer. And I love every cycle you go back to crypto blockchain's similar, right? A lot of these new technologies they have that way, right. All the money goes toward it and then all of a sudden things change. And these things aren't going to change because that's the game. If they can make a smart bet during the dumb phase, they win. And their portfolio can handle some of those dumb bets to be bad outcomes. But those of us started companies, we ought to be more careful because when you start a company and it passes away, that's a lot worse for you than it is for your vc.

Yeah, well, really insightful answer there. And I just want to kind of transition to one last question about what you're doing now. I know you're a board advisor at Heirloom and so wanted to just know about how you got introduced to Heirloom and why you're excited about kind of being part of that team.

Yeah, I mean that story is kind of a, it plays back a dimension of the networking that I know USC students always hear about networking, networking, networking. But for me it's just practical. Right. It's not investing as networking. So I, I came gradually moved back to LA from Northern California, started engaging Viterbi Startup Garage and one of the first teams that was introduced to the first cohort was Nick Dazzle and Julian, his co founder and they had another startup and it wasn't Heirloom. Right. It was called Block at the time and it sort of failed. And then they started Pocket List and then it was a pretty good idea, but Pandemic kind of crushed it. And then they were thinking about going back to more traditional work, but they kept working on the side and then they came up with the idea for Heirloom. And throughout that process. Originally I played that role officially because I. I ran sort of the program at the Viterbi Startup Garage. And then we stayed in touch because I liked him. We went from the guy who just like talked incessantly at his introduction meeting to me jokingly being his coach to get his communications more. More pithy because he's actually a great guy with super smart. But he was one of these guys that needed to work on stories. So we spent a lot of time on that through all these startups, provide a lot of feedback. And then one day he called me and said, I need a session. And we met down at the local brew pub, downtown Manhattan beach. And about a company who's thinking about starting with Julian again. They're great co founders. That's a whole other lesson. You have a great co founder. Hang on with both hands. So they're on their third or fourth iteration and this one's pretty exciting and I think the one that's going to pop. And he asked for my advice and I started getting into it and I realized this is super interesting and not only that, I would like to learn more. Right. So yes, I'm providing my counsel to you based on whatever the heck I've learned over the last year, number of years. But I also, this is new for me. Right. So web3 and blockchain was new. And I said I'd like to, if you don't mind, I'd like to explore this with you. And so we did and we kept talking informally. And one day he and Julian called out of the blue on a FaceTime and said, can we talk? Yeah, what's wrong? I said, well, we want to be formal about this because I know we've had an informal relationship for a long time, but we would like to nominate you to the board and put you through a process to join as as a board of directors. So there's two VC seats, sorry, two preferred seats and one independent board seat and we'd like you to try out for that. And so they put me through the hoops and eventually I joined as as a board member. And so that's for me, you know, again, that's you're always learning in life, right? So no matter where you are in the process. So I've been a, a mentor, I've been an advisor, you know, strategic advisor for equity. I've been involved in a lot of programs, but I've never actually sat well and I actually was the board chair, founding board chair of a non profit. So I've been on a non profit board, but not a for profit board and says, ah, this is cool. This is a new technology space, right. Because I've been involved in a lot of platform shifts and blockchain and AI are two of them and I am not in the game anymore. So it brought me back into the game and oh, I'd like to evolve into the Check the box. That said, I'm also a private company board member as well.

Well, Rob, really just want to thank you again for not only taking the time but relaying so many stories that, and I now, now that you've said them, I remember little glimpse of them from class, but it's great to hear them in more color and much more personalized. So really thank you again and I think everybody will get a lot of value out of this episode.

So my pleasure. I'm just happy to hear you remembered something, that's all I ask.

All right, thank you, Rob.

All right, take care.

All right. Well, I thought that was a great episode as I was expecting. Really reminded me of being back in Rob's class two years ago now, just in terms of how captivating he is in the way he speaks and the way he presents himself, but also to learn about all of his experiences from working with Steve Jobs and how that led into his time in teaching and also, you know, his work at Carbon and earlier at Microsoft. Just really a wide range of experiences that I think a lot of people can take lessons from. So I hope everybody enjoyed this one. And we will be back in January with new episodes.