Scott Wayman and Charles Masters Rodriguez on Making the Transition from Employee to Entrepreneur

People will be like, people will say, oh, it must be nice to have like your own business and control your schedule. I'm like, must be nice to stop at, you know, 9 to 5, you know, because we don't, like I work weekends, like, you know, I sometimes I have to say no to my friends or family, like visiting them. Like that's just, that's just stuff that we have to deal with, you know, when you're a founder. So I would actually advise like if you're, you know, if you're still trying to test it and then see it out, work your full time and then work your side hustle. You know, on the weekend. And once your side hustle almost becomes your main hustle and you have enough savings, go, go full in. It's like Scott's saying, you cannot— you don't want to just like tip your toes in for 2 years. You're not going to do something like that. Like, you really need to, you really need to put pressure on yourself in order to grow. Because the only reason why I've accelerated and, you know, gotten to where I'm at is because I've been uncomfortable before I'm ready.

Scott, you're coming in from Buffalo. Charles, you're coming in from Miami, is that correct?

Well, sort of. My— the company is now in Buffalo. Uh, when we won the 43 North competition in 2018, we moved our company there. And, um, the, the requirement is you move there, you give a 1-year commitment, uh, and we're still there. We're still there. We have a great headquarters there, uh, with, with bunches of people, um, and, and growing, and love our home in Buffalo, New York. But I spend time in both Long Beach, California, and commute back and forth.

Awesome. So maybe we'll just dive into that. So we'll do a brief introduction with you, Scott, and then we'll come over back to you, Charles. But I think just to begin with, so Scott, you know, you got a rich background in both healthcare informatics and childcare technology. You know, what really sparked this idea to help create this startup, where'd it come from?

Yeah, so KT, Kangaroo Time, started, uh, I adopted my youngest brother after some crazy family, uh, circumstances in 2001, and I was 26 years old and, uh, all of a sudden was responsible for child care. I took him to a child care center. They would manually bill us and, um, I helped write them a little payment gateway, a little capture engine, and managed it until 2013. But beyond managing that for 12 years, went and started a company called MedStreaming or helped start a company called MedStreaming as one of the co-founders. And as we were building products for— we built an electronic medical records platform, a practice management platform, an enterprise informatics platform for health systems. And as we were building those, I kept saying to my co-founders, like, this would be fantastic in the world of childcare. I've already— I understand the business, I know it. And Jordan, like any great entrepreneur, from the day I thought of the idea, until we started building KT and I started my journey at Founder Institute Los Angeles. It was about 14 years. And KT took— I think we just had the advantage of this really interesting shift in the childcare business. Millennials wanted to lean into child professional institutional childcare that had education, that had more of a formal delivery model. And we started building software that could facilitate that and make the business more efficient. And it was like lightning in a bottle. We really, we really timed it well and listened to our customers. And now today, KangarooTime is It's a billing engine. It's a parent engagement platform. We actually have an AI platform that does dynamic lesson planning and has all the tooling for teachers at point of care. So in 9 years, it will be 10 years. We have our 10-year anniversary February 15th. That's when I incorporated it at Founder Institute was February 15th. We didn't actually get product out until December. Of 2015.

So wait a minute, things aren't an overnight success? You don't just launch startup and then tomorrow you're a billionaire? It doesn't work that way?

Yeah, um, they are, and I promise you, just put the shingle on the door and no, um, no, it's a journey. And I think that's the, uh, that's the beauty of it. And, and in fact, um, that's the best part. You know, we talk about the journey of a startup, just learning and grinding. And we went down to $0 a number of times. Jess and I were so pot committed. Jess is my wife. We had put our entire life savings, mortgaged the house, over $1 million into the company because we had big enterprise customers that were onboarding. There's a documentary called For the Love of Buffalo, and we became— Kangaroo Time became the star of it because our story was so interesting. In the end, before we won the contest, I had to borrow $100,000 from my father-in-law. And, and he was gracious. He didn't even charge me interest. He just gave me funny looks during Thanksgiving dinner. And then we went 43 North. And paid it back, and then we had our inflection. So it's definitely a grinder's journey.

Okay, we'll table it there 'cause I wanna come back to 43North 'cause I love what they're doing there. And selfishly, I'm a Buffalo Bills fan, so I'm always interested in learning more about Buffalo and talking about Buffalo. But maybe, Charles, on your end, so is it true you kind of came from a military background and then you decided to then go into startups? Can you maybe tell us about that journey?

Yeah, for sure. So yeah, I was an Army engineer diver for 5 years. Did that, one of my favorite jobs. When I got out, got medically retired in 2019, I kind of like basically had to fend for myself. I always had a passion for entrepreneurship and business, and this was kind of an excuse to start over. So I started MK3 Industries at that time. Leveraged e-commerce and actually, so a little bit of backstory is before AutoCAD, I ran and I still run a wholesale distribution company for automotive equipment. And that's when I found that problem. But so I was running that leveraged e-commerce marketplaces, started learning a lot about, you know, some of the pains that automotive wholesale distributors go through. Uh, you know, uh, bootstrapped that and used zero-interest credit cards to jumpstart that and grew it to a couple million in revenue this year. Um, so as I was doing that, like I said, I noticed all the pains of running a bootstrap business and then running an auto parts supply company, um, and trying to find different suppliers that wanted to onboard with me and different manufacturers and then finding buyers of the auto shops. So it's still a huge problem, and that's why I wanted to come up with AutoCAD, which is that AI-powered automotive marketplace for auto parts. So a two-sided marketplace that's connecting one side to the other so we can just buy parts quicker, faster, better prices.

And maybe just before we move on, because it's so interesting, can you just briefly tell us about the world of underwater diving, like the— for sure, what exactly we're doing. And because I'm sure there's lessons that you can learn from it, from like overcoming fear within the startup world to taking risks to, uh, putting it all on the line. So yeah, what was that like really quickly?

Yeah, and that's really what gave me the base for entrepreneurship. Um, so yeah, I was, I was running a 25-man dive team in the Pacific, so I was stationed at Joint Base Pearl Harbor-Hickam and we were doing, you know, dive missions all across the Pacific. So Vietnam, Cambodia, Thailand. So it's always, it was always like high pressure situations where you had to make, uh, you know, life or death decisions, uh, and, and, you know, those decisions for other people as well. But we did, we basically, I tell people that we do everything engineers do above water, we do below. So underwater hydraulics, demolition, search and, uh, rescue recovery operations. Um, yeah, underwater explosives, the whole nine yard. So that, that was really a good base for, for getting into entrepreneurship because you have to have the resilience and grit and you have to make decisions at the end of the day no matter what. So pretty good base.

Yeah, big time. Uh, no, I used to be friends with, um, police diver, and, uh, in murky waters it's a pretty scary job for sure. Yeah, probably Probably the scariest job I can almost think of.

Yes, you're swimming in the dark most of the time.

So, which is kind of like what startups is, right? Startup life is basically swimming in the dark. So maybe, Scott, we'll come back to you. So, you know, you're, you're starting to get traction, you got revenue coming in, you decide to like, you've been through Founder Institute, that gave you kind of like the base that you needed to move on and have the structure that you were looking for. You know, and then you decided to kind of take it to the next level. What was it like, like applying into 43North and scaling and just that whole process? Because it's a great program, you know, and a lot of times Founder Institute is the beginning of people's journey, and we know that we can't take them to like those larger seed rounds. We, we guide them with the process, but, you know, we rely on other accelerators to kind of take over. So what was that whole process like? Because it's, you know, one of the most respected accelerators that we've heard of within the ecosystem, but it's also one of the largest, like, pitch prizes in America right now.

Yeah, in my opinion, you know, $1 million for 5% equity is really efficient capital, especially if your revenue is not quite there or if there's no real applicable valuation multiple to be applied to the business. So yeah, it's fantastically efficient capital to bring into the business at the time. Um, in 2018, we are actually celebrating year 10 of 43North in October this year, uh, and we were year 4, uh, cohort at the time. They would give away 8 prizes, $1 million winner, and then 7 $500,000 or, you know, 6 $500,000 prizes. And then there was one for like $650,000 for second place. We were one of the $500,000 winners. So finished Founder Institute in May of 2015. And then I used kind of my sales background to really start to get out there and hustle and and just give myself exposure to the institutional venture capital world. So I entered Tech Week LA, Vator had a big contest that we won. I entered every pitch competition I could just so I could get the reps, get in front of people. I won one. At Tech Week LA, we were second place. And there were all these famous people there. I'm on stage or getting ready to go on stage and pitch with the microphone on and everything. And, you know, famous boxer Sugar Shane Mosley was like, all right, man, do this. If you win, I'll cut you a check for $50 grand and we'll do that. Anyway, it was kind of a wild ride, but more than anything, it was getting reps and learning how to pitch the company and practicing my pitch and codifying the the value proposition of the company and getting a little bit of exposure. When we won Vader, Vader Splash, it was a contest at the time. We had a local investor approach us and say, look, we really like it. We want to sit down with you. They met me and then they wrote a check, and that was Mucker Capital out of Los Angeles. And we did like kind of like a seed round in, in November of 2015 before the product was really done for like $300K. That gave me enough money to, to kind of, uh, hire devs and, and start working on the product. Um, I was doing a lot of it myself and then, uh, raised, raised another $1.8 million along the way. We were, we were closing customers, you know. I had, I had had so much exposure to the vertical to the vertical of childcare, we had customers that were, were ready to go. And part of the coursework I was doing at Founder Institute was pushing me to close deals. So we had deals waiting and we didn't have product. So fast forward to 2017, when the— when October of 2017 came around, we were doing like $15K in MRR, $15,000 a month. But we had orders for another $40K or $50K that we just, we couldn't build product fast enough to have table stakes to run these larger childcare businesses on. So, you know, entering into the contest, there was a lot of lot of explaining as to where the business was and where the revenue was and working with 43North to help them understand this infusion, you know, this $500,000 or $1 million really makes the business viable. You know, it really grows it, you know, 5, 6x. And we have a path to, you know, $1 million a month in revenue. We're starting to see it.

Yeah, one of our founder and student mentors, Bryce Szechek, he's got a really good presentation that he does usually for like growth sessions. And, you know, they've invested in lots of companies. He had like a unicorn exit. And he talks about how like with every startup, there's themes. And a lot of times the themes are based on like the skill sets of the founders. So like, you know, for example, it sounds like you like you knew your industry cold. But then also you were really good at pitching and obviously good at sales because you're able to bring in sales.

Yeah, yeah, yeah. The Founder Institute archetypes. I'm a hustler, like, uh, not very bright, obviously. Um, I can barely, barely talk, but I, I can, I can hustle. And, uh, and there, you know, I, I come from a sales background. I was a college athlete, two sports. Know how to grind. But yeah, I think there's merit in just doing it.

Well, I think pumping your tires a bit. I think you could tell you're an athlete. I was going to say, because it's like you limit your role within the team to put it back onto the team, which is, as a leader, a really great quality. So maybe, Charles, from your perspective, like, you know, what were those early traction points that kind of lifted your story up to where you are now? Like, were you really good at pitching? Were you good at pitch competitions or fundraising or sales or product, or what was that really inflection point?

Yeah, I think similar to Scott, you know, one, I had really good, you know, basically knowledge of the industry because I'd been in it for 6 years, right? Struggling and hustling, right? Um, so I, I already knew the customers on both sides of the marketplace. I would talk to them and they would tell me all the problems. So, and I had that sales background too. So that was my job is close B2B sales. In addition to that, you know, we incorporated March 1st, you know, did Founder Institute and finished that in May. Right before that, I mean, Founder Institute helped me kind of, you know, organize all my thoughts and how I wanted to go about building this marketplace and also getting myself ready to pitch. So doing the 60-second, you know, the 3-minute pitch, which I think is one of the hardest ones, you know, the 4 or the 5. Um, and that's exactly what I did. We, we applied for the Emerge Tech Conference in Miami, which is the biggest tech conference in the Southeast, and we, we placed, uh, top 5 and first place university track, which, which gave us $30,000 non-dilutive funding. Um, so that was basically what we're using now to, to do the MVP, you You know, before we had nothing. So we were pinching pennies trying to— I was kind of taking my money and the other co-founders' money all in and trying to do what we could. But now we have actual funding to play with. So, you know, like I said, similar to Scott, I continue signing up for pitch competitions to this day. One, to get reps in. Two, to get, you know, in front of more VCs and investors and just more feedback. And then three, for that non-dilution. To funding or, you know, or funding in general.

So Charles and Jordan, I mean, the— so, so it started at Founder Institute for both Charles and I, that, that process of putting together something that is, is optimizing your pitch so that people understand the business. Um, I think that creates grooves, you know, like it, it creates grooves. You, you You have a revenue slide with a business model, right? And then that really just kind of clarifies to your customer, to yourself, how we go and get revenue. You know, KangarooTime, we have a processing gateway. So when parents pay for their childcare, we facilitate that for them. And, you know, we have all the invoicing business logic and everything. But we make money on that. And when we were going through the process and talking to investors and talking about the, the GMV, the gross merchandising value that goes through the Kangaroo Time Gateway at one center, which is, you know, typically $100,000 a month, and, and the fact that we could capture a 3% take rate or, or somewhere, you know, somewhere a take rate or margin, people got really excited. And finding that and fine-tuning that story was part of just getting in front of people and pitching it. Same with the product too. You know, I think investors and founders should be laser-focused on what the product does. And in fact, I think the biggest failures or the fastest way to failure is just to have too broad of a scope. And Charles, you know this, you built an MVP, it sounds like on $30,000. You know, today we spend, you know, hundreds of thousands of dollars a month just on R&D. That does not include what we spend on our sales engine. And in the early stage, you don't have the, you don't have the luxury of quality. You can't go find the greatest developers in the world. You might find one, but you've probably got some outsourced dev house that's gonna inefficiently and probably not in the best way build something for you. So yeah, you just have to be really tight on what the product is. And that comes with just conversation and customer development and pitching and those interactions.

No, I agree, because it's, um, a lot of people don't understand what it takes to actually build a startup, right? And I think that it really, it's analogous to like building, um, like a race car, really. And it's like, you know, it's expensive, it costs potentially hundreds of thousands of dollars, um, you know, you need a great team, you need to go market it, you need to do all the things you need to do, um, but regardless, it's going to be very expensive to build that engine. And I think that people don't fully appreciate that. Another thing too is like, you know, we see a lot of third-party developers coming in and like offering to build out the product early on, um, and then it ends up working against them because like they don't own the car. It would be like not owning the car and you're renting the car out, and now the rental fee on the car is really expensive because you're crashing it all the time. And like, you know, it's not your own shop, it's someone else's shop, so the iterative loop's really slow and, and like things just end up costing money.

And so I think, um, but let me be clear, there's no reason not to do that. In fact, it's better to err on the side of being super aggressive and having an outsourced dev house or, or, or somebody just cobble together an MVP. And in fact, our, our biggest successes have come when we, when we introduce the, the shell of a product and it has really no kind of like workflow engine. And we just capture data and we learn and, you know, we see, we measure adoption and see how people use it. It's cheap. You know, you throw just a crumb of the potential product out there and then you can really build something special with great customer development cycles with people using it.

Yeah, I agree. It's like You know, with a really good UX/UI designer, you can kind of mask things in the beginning before you can build it out to try and just go sell it and like make it look good, make it look professional. So maybe if we're fast forwarding kind of to today where you guys are now, like Charles, I'll bring it over to you. You know, they say most founders, really their role is to fundamentally like find money either in terms of like capital or sales. And then also scaling the team and hiring. So, you know, what does your kind of day-to-day look like and where you're at right now?

Yeah, for sure. So we're actually really deep into customer discovery and in the feedback loop with customers right now. So I was fortunate enough. It's so crazy, you know, I've always been a solopreneur, right? So like bootstrap my company. There was never any equity there. And as I started taking Founder Institute and connecting with people on LinkedIn, it's almost like I was attracting my co-founders. So within, within being at Founder Institute, I found my CEO, CIO, and then I also found my technical co-founder as well, my CTO. So literally it couldn't have been more perfect. So, you know, in terms of like the CEO founder, like your job is really like assembling a team. And steering the ship in terms of vision and then money. Like you need to find the money no matter how it is, whether you're looking through your couch for quarters or you're going and you're pitching, like you just need to be scrappy about it. So that's my general kind of role in the company. And then in terms of like day-to-day, we're active on Slack trying to make sure you know, that everything is rolling. I'm making sure that they're aware that, you know, we're applying to this accelerator, YC or Techstars, you know, why this would work, why this wouldn't work. My CEO, CIO is connected with my CTO and he's making sure that, you know, we're on schedule for the development. And then I'm trying to make sure that we're finding the right customers and doing the feedback loop for the customer discoveries. Because like, like Scott said, you can't, you can't be doing everything because you don't have enough money. But it really boils down to, are you solving that one, like, hair-on-fire problem that people will pay for? And if you're able to do that, then you expand on that. But you gotta be careful for feature creep and all these other things, because then you start losing, you start spending a lot of money, and that's the last rule, is you gotta make sure that you're staying on the budget.

You start spending it before you're getting it. Man, so the ICO is going to be great, guys. I remember you're in, um, Miami, and like, I remember after the ICO days, they were just heating the building with cash money. What a time to be alive. So right now, Charles, how many, um, how big is your team right now?

Yes, it's just 3 of us.

Um, yeah, so yeah. Yeah, startup is typically classified kind of like, let's call it 1 to 20 employees. And then Scott, like, you're kind of in almost the what will be scale-up, which is like 20 to like 500. Like, how big is your team now?

Yeah, about 100. Um, yeah, it's huge. Yeah. And, and, uh, yeah, so, so Jordan, I miss the early days, Charles. Like, I miss the days when there were 3 of us, and the first 3 are still here. We all moved to Buffalo together as part of the journey. We kind of, we sit on a different wavelength than everybody else. But I miss those days so much, and I love those days. And Charles is absolutely right. In my opinion, a founder has 3 enduring jobs throughout the lifecycle of their journey at their startup. And it's to go find the best people in the world. You know, just, just go find great people. And then number 2, it's set the vision from day 1. I have, I have made it my mantra to, to help our customers understand what the vision is, what they get when they buy us, and obviously our employees too. And then 3, And I think this one is the most important because just, and this has changed over the years, but to capitalize the company. You know, there's nothing more unnerving or nothing that tears away at the framework of a great organization like financial instability. You know, if you can't bring the proper amount of money in to fund your initiatives, R&D, sales, marketing, it's very tough and people don't like to work in places like that. So I've always felt like that is foundational. And then, you know, in year 9, I, you know, basically from year 7, once we got to a critical mass of employees to where you could carve out business units and have coverage across distribution, product creation pipeline, GA, your general administrative. I felt like my job was to step away from product and let professionals really lean into it and prioritize the precious dollars we spend in our product creation pipeline and step into a role to where I was culture. You know, KT is a great place to work. People, people love our brand. Our customers love our brand. I am like the, I am like the, uh, the master of hugs at trade shows. I have like, I, I go to trade shows and I have so many dear friends and our customers, and, and that's me now. Um, do I feel a little unequipped sometimes when I go into a product conversation these days, Charles? You will. Because you're not there all the time and you kind of want to step out and let people, really smart people, you want to empower them and let them cook. You want to let them do their thing. So yeah, Charles nailed it. And then later stage, I think you just turn into a kind of a specialist. You know, like I know some founders in later stage that almost lose their identity. Because they shift into a new role, they're needed for recruiting, and then all of a sudden, that's not their scope of excellence or their scope of genius. And then they're just, they're done, you know, or they, you know, they, they just, they, they don't have as much relevance inside the business. But, you know, at whatever stage, do whatever you can to help.

Okay, pretty soon we're going to transition into Q&A. But before we get there, Well, one thing we're gonna talk about where you guys are going, but I think before we get into that, we're getting a lot of interest because there's so many tools now, there's so many subscriptions that you need, there's so much AI tools coming out. Maybe we'll start with you, Charles. Like what's kind of in your own personal portfolio of tech stack basically for Hacks? Like, you know, what tools are you using? What are you using for email? Um, like, are you finding efficiency hacks in your, in your day-to-day?

Yeah, I mean, you know, I definitely use a lot of tools. I mean, so like HubSpot CRMs for startups helps me out a lot. You know, really like some of the biggest things is like consolidation of information right now, um, has been one of my hacks. So that definitely helps me out. Um, you know, Slack will always be there. ChatGPT and, and, you know, Gemini are also very good to via Soundboard as well. That's just like personal. But in terms of like AutoCAD and our stack, like we use Flutter, Amplify, Next.js, AWS, and we do use GCP as well as Figma. We're kind of doing like a hybrid model since we're growing and we're also trying to stay ahead of the curve. It's almost like an AI, it's like an AI competition between everybody and we don't really know who's going to be the top performer yet. So we're keeping our door open in terms of like our stack as well. So that's where we're at.

Jordan, can I be super vulnerable here?

Yeah, please open up the hood. Let's hear it all.

Yeah. So I feel like as I've gotten further downstream as a founder/CEO, I've used less and less tooling and kind of leaned into, you know, just very rudimentary tooling. And my teams use a ton of automation and tooling. ChatGPT over the last year and a half, especially with 4.0, has gotten so great. So I will use it as a reference to kind of pressure test all of our models. So if we're looking at revenue builds or if we're looking at some sort of like some sort of utilization science within, you know, within the product, or I will synthesize it through ChatGPT just to give me some foundation for ideation. Also to pressure test it just to make sure that I don't walk into a team meeting completely sideways or with a missing coefficient or something or variable. But yeah, I probably don't use as much tooling as I used to. I used to be such a kind of a diligent, task-oriented CEO, and it's gone away. I just don't do it as much.

No, that's the goal. Is to eventually get away from all technology. And ideally you're just having discussions. That would be the goal. I think we'll come back to kind of where we're moving in the future in the sign-offs. Maybe we'll get into some Q&A. So our production team, they're moderating here. So they're gonna bring up our first question. But I think the, for everyone that's unfamiliar, just in the top right where it says Q&A, you can put a question in. And then we're going to pull up one of the first questions right here. So curious, would you recommend straddling full-time job and startup or co-founding a startup if starting by yourself without a safety net is not a choice? So hopefully that makes sense. And either of you can answer this.

Yeah, Charles, I'll answer it. Um, I, I just don't believe that you can accomplish the impossible, which getting a startup off the ground can be if you're not 100% committed. I think you have to put yourself into a situation to where you can dedicate a majority of your time to it. Now, there is the laws of physics. There is reality, right? You have to pay your bills, um, that typically involves being gainfully employed and dedicating a good amount of time to an employer that needs your services. But I think it's very tough, but it is, it is something you can accomplish. Um, I think there's, there, there are choices you can make, especially with lifestyle. Uh, Kevin Siskar, who's a good friend of mine, he was for— he was the managing director at 43North. He was also managing director at Founder Institute New York. He and I— he talks a lot about your personal burn rate and preparing for entrepreneurship and getting yourself into a place. My wife and I, we are dual income. I had had an exit. So that was like, that was my that was my opportunity to just kind of say, okay, for— we've got like a year and a half worth of salary here. I'm going to lean in and do it. And not everybody can do that. And if you can't do that, work your 9 to 5. And then you'll see in the documentary, if you do watch, if you do watch it, I made Kangaroo Time a full-time job and then my side hustle. So our engineers were in India in the beginning. So I would work all day long on sales, business development, customer development, and then come 6 o'clock, I'd jump on with our engineering team and our product managers over there. And I worked till about 2 in the morning. I was not getting a lot of sleep, but I was young back then, you know, in my 30s, and I could do it. Charles, you're a young man. You know, this is definitely the time to index on making your startup your, your, your full-time job and your side hustle. Uh, but yeah, I just think the, the, the actual, um, forces of nature that have to, to happen and fall in place, you just give yourself a much better, uh, much better chance of winning if you're all in.

Yeah, Charles, like, how did you make that decision to do the leap of faith?

Yeah, so I mean, mine was, mine was a little different too, just because like when I got medically retired, I had a little bit of funding coming from the government, right? Every month. So that, that gave me a little cushion, right? It wasn't, it wasn't insane. Like I wasn't eating lobster and steak every day, you know, I was, I was making sure that, you know, my funding at least covered where I was staying and all that stuff. But, uh, but I would actually say like, working, working a full-time job and then working on your startup during the weekend would— is like, is a very viable option. Not only that, it's almost like a stress test for you because this is how life is gonna be. Like, you know, people will be like, people will say, oh, it must be nice to have like your own business and control your schedule. I'm like, must be nice to stop at, you know, 9 to 5, you know, because, because we don't. Like, I work weekends. Like, You know, I sometimes I have to say no to my friends or family, like visiting them. Like, that's just, that's just stuff that we have to deal with, you know, when you're a founder. So I, I would actually advise, like, if you're, you know, if you're still trying to test it and then see it out, work your full time and then, and then work your side hustle, you know, on the weekend. And once your side hustle almost becomes your main hustle and you have enough savings, go, go full in. It's like Scott's saying, you cannot You don't want to just like tip your toes in for 2 years. You're not going to do something like that. Like, you really need to, you really need to put pressure on yourself in order to grow, because the only reason why I've accelerated and, you know, gotten to where I'm at is because I've been uncomfortable before I'm ready, and then I just step in.

So yeah, I think, uh, I stopped golfing once I became a founder anymore. Okay, maybe we'll get into another question, uh, We'll pull it up here and again put the questions in the Q&A if you want to have one. So how important do you think it is to engage with VC and entrepreneur communities such as your pitch contests and similar events when you're still developing your product and your company leans more towards being a lifestyle business? You know, and we don't have to focus down on the fact that it's a lifestyle business, but I think, you know, how important is it to get in front of VCs?

Yeah, I mean, I think it's super important. Uh, you're just, you're just trying to get reps at the beginning, right? Like, I wasn't, I wasn't the best pitcher, you know, best pitch person ever. Like, I was good at sales, but you're really just trying to figure out, you know, what are the holes, what are the holes in your business idea? Like, what are the holes in your company? What are the holes in how you talk about your business, because VCs and other entrepreneurs, they'll tell you, like, that's who you want. You want that direct feedback. I— and you learning like that, when you have someone saying, no, I'm not going to invest in you because of this, like, that is the best feedback that you can ever get at high stakes, because you will never forget when you didn't close that deal because of something that you said. Or because of a way that you said it or because they didn't understand the way you talked about it because you're too close to the product. So that's my side.

Yeah, Scott, you've done a lot of pitch competitions, you won a lot of pitch competitions. What's your take on it?

So I think it's absolutely accretive and a positive as you build a network, right? I do have a word of caution there though. As I would go to these things, I would see some people that just kind of loved the juice and the, you know, that experience of networking. And I think that's interesting. Sometimes you just want to kind of say, hey, maybe you should be working on product. Maybe you should be really hustling and doing investor meetings instead of out to drinks at the, you know, at this event or whatever. But there's, there's so much value in having conversations, building your network, talking to other founders. I mean, Charles, you know how it is, just having your, your close-knit group inside your Founder Institute cohort, that in itself is, is your mental health. It's, it's your inspiration. If you have a competitive spirit, it will push you along. But yeah, I love them and I think it's accelerated learning. It's like going to a trade show and getting to do 100 demos in a few hours instead of, you know, doing it the old-fashioned way. But yeah, the only caution is just don't obsess with that. Like, go build a business.

Yeah, I mean, we're in Waterloo and so we have like very technical teams. That a lot of times they're not very good at sales. And I think that's where the weakness comes in. It's like you, you need to get yourself out of the building, you need to put your ideas out there. And, you know, if anything, there's red flags when people are reluctant to put their ideas out there and try and get validation, because I think it's so important to just get that initial feedback and fundamentally to create that luck. 'Cause I find like every time you put yourself out there, you know, even if it's just a matter of like going to a conference, let's say you don't have the money to go to the conference for a booth or anything, it's still worthwhile to buy like one of the cheaper tickets to just go attend, you know, and then you can put, you can then at least go work the floor and meet people. It was like the first year we went to South by Southwest, I think I got 500 business cards. And then the second year I got 3 business cards. Because it was like then more targeted. You knew exactly where you needed to go. But like that first time I didn't know anything. So it was just a matter of talking to as many people as possible.

Jordan, some of my biggest, some of our biggest moves in, in both my businesses have been facilitated by another vendor that I met at a trade show. So, you know, I'd see another vendor. They knew somebody at this huge account that I knew needed us. And I got the intro, or, or they just kind of gave me that, that warm opportunity to, to be connected with that person.

Yeah, that's awesome. Okay, let's get into another question here. Uh, so how do you get early traction when you have full-time job that is needed to bootstrap the startup? This is in the context of less time for networking and pitching. Also, you may want to do under the radar of your employer. So it's the chicken or egg basically problem. So yeah, who wants to take this one?

Yeah, I will. So I was in that scenario and I felt like there were milestones that I had to just hyper-obsess with. And for me, when I left my full-time corporate job and 2011 to go to Medstreaming full-time, it was all about kind of like creating enough revenue so that I could pay for myself, you know, so that I could pay for my salary. So I would just kind of— we triangulated to a plan to a certain number of customers. It was just like an obsessive, very diligent, disciplined 1 hour per day of demoing. You know, I could do it super early if it was East Coast, outside of work hours. I could do it after work if it was, you know, or later in the day if it was on Pacific time. But I think having goals and framing out what gets you there, whether it's revenue, whether it's getting to a certain level of product market fit or product maturity, and chipping away and understanding those goals and obsessing over them. I think the most frustrating thing, I think where dreams die is when you don't frame the, and have, Adeo used to call them false starters or false motivators. Like, you know, I'm gonna intellectually get to a place to where if I don't get this done by this date, then I have to punish myself. You know, I can't, you know, I can't go for drinks with my friends, I can't hang out, I've got to get this done. So I think there's a level of discipline that can be deployed so that you can get yourself ready to move on. And it's intense, but there's nothing like it. I think, uh, you know the actor Chris Pratt? Um, he, he had some— when he did the, the first Marvel movie that he did, he got all ripped and hot and everything. And, uh, and a person asked a question like, "Hey, I was your, or I am your size that you were when you were on Parks and Rec and you were like 270 or whatever. How'd you do it?" And he just said, "My mentality was nothing tastes as good as it feels to look this good." And he just said, "That drove me and it was my north star." So, find the north star and then science the shit out of it. Figure out what you need to do with the limited amount of time to get to that north star.

Yeah, Charles, I mean, you probably from a military background, you're probably pretty disciplined. How has there been techniques there that have helped?

Yeah, I think, you know, the aspect of, of always trying to maintain, you know, an optimal level of working is, is, it's like a daily struggle. Like, literally every single day I wake up and I'm like, okay, like, how do I optimize my day? And if I had a day where I was like, that, that was not optimal, like something happened that and I ask myself like, okay, so like, what do I need to change? Is it, you know, is it because, you know, I turn on the TV for lunch? Like literally I'll go down to like that level. Okay, so I turn on the TV for lunch. Like I was eating while I was watching TV. Oh, I went 45 minutes watching TV and stuff. So like, I'm like, all right, I'm not watching TV anymore. So I unplugged the TV. So there's things that you can do on a daily basis. To continue at an optimal level. Like, my favorite book, and it's like my Bible, it's called Atomic Habits. Um, it literally is, is what I breathe through in terms of, like, even, even when I wake up in the morning, I have my, I have my coffee next to the book that I'm reading, whether it's like Lean Startup Ideas or, you know, whether it's 48 Laws of Power or something where I'm just trying to grow. Um, but you just, you just need to, you just need to continue working on it. You know, there's, there's days where it's just, it's not optimal and I know it and that's just a skip day and then the next day you try to do better.

So yeah, there's no shortage of work and like until the Tesla robot delivers in hopefully 2 and a half years, it's like you're working on your own. So yeah, I, I, for me, I found, um, like a, like a productivity planner where I can mark out the day and then like I use Pomodoro method with like, I got one of those punch clocks. And so then I'll— everything's a scrum. It's like, on Mondays, defining the scrums for the week, and then breaking down the day in terms of, let's say, like 55-minute scrums with maybe a 17-minute break or whatever, like time period you want to do. But I find when I'm not conforming to that system are the days that I'm not as productive, for sure. Okay, let's get into maybe one more question. And then We'll kind of do a bit of a sign-off and then we're going to get into networking. Everyone can come back to the main intro room. So yeah, final question: how would you define product market fit? Is it MRR that VCs look for these days? Or what I think where this is coming from is, um, you know, it's very difficult to fundraise these days, it seems. Uh, it's not like, um, the ICO days were heating the buildings with cash. The, uh, so a lot has changed. So yeah, um, who wants to jump on this one?

Yeah, this was, this was kind of my journey, that this very question. And this will also— I mean, once, once you achieve some sort of product-market fit, this will also define your valuation, uh, forward-moving, because, you know, you, you are, you are selling the potential and the multiple of what your thing can be, right? So For me, the proxy that most people used to judge the legitimacy of kangaroo time was MRR. And beyond that, there were other SaaS metrics that were highly scrutinized in the early days. You know, like if you're bringing on 2, 3 new centers a month, how many are you churning? And then is the MRR revenue build like, does that indicate, does that signal to the investor through financial performance and revenue performance that this thing can get to venture scale, that it can get these investors a really nice multiple on their investment? So, so yeah, there's MRR. I also think if you can go improve differentiation, that, you know, as we got into our Series B, we got a really nice multiple because every enterprise customer in the country wanted to run our stuff. And, and either— and, and that's still the case, you know, an enterprise that has hundreds of centers in the US or in Australia, they look to KT first because we built that differentiation inside the product. So, so that landed us a really nice connection to what the multiple could be into the future. So if you are, if you are building something that, that really applies to a segmentation that has, that has a really interesting TAM, um, that is a part of it. But I, I hate to say it, I know, I know it's, it's almost too playbook-ish. Your revenue is, is definitely the closest proxy to understanding product market fit, the health of the business, the potential, um, growth rate was another one. I love going into a fundraise where I could show growth rate of 7% month over month, uh, 12 months prior to the fundraise, because that, that, that just exponentially, uh, extrapolates into really good value for the shareholder.

Uh, okay, maybe we'll just end it there. Um, But we'll hand it over to you, Charles. So like, are the things that you need help with, are you hiring, or is there just overall parting advice that you have for founders? So this camera, this camera, this camera. What do you want to promote, Charles?

Yeah, I mean, if y'all know any people that are auto shops or auto suppliers and that want to talk to us, you know, we just want to have them as a sounding board to understand more about their pain points. Uh, but you know, in terms of, of parting advice, I would say, you know, the founder journey is, it's a struggle. Like, it's not easy. I, there, I mean, Scott knows, Jordan knows, like, it's just, but it's so rewarding at the end. Like, it's so rewarding. And, and the best part about it is you're always growing. Like, if I. If I saw myself like 3 years from now and I talked to myself, like he wouldn't even believe that I'd be where I'm at today because, because you really just need to, before you're even ready, step foot into the shoes that you need to become in order to continue succeeding. Um, so that's, that would be my advice and, and would love to connect with y'all on LinkedIn. Like, you know, search for me and I'm always willing to talk to other founders and mentor, uh, you know, as y'all grow in this, this journey.

So awesome. Yeah. And Scott, with you, anything you want to promote, uh, or just parting advice?

Yeah, no, I'm here to advocate for 43North. So, so keep close— pay close attention, um, for this year, year 10. Applications are in. Um, it changed my life, and I, I just feel like it's such a great ecosystem. I've learned so much from our, our investors in Buffalo But I'll say this, my parting advice, there is an evolutionary biology, there is a primal instinct to provide for people and to create things. And if you're thinking about it, just really make the considerations around who your tribe is and what kind of support you have. You know, Founder Institute has been so integral in my journey. And, you know, as we alluded to before, you need those people in your tribe that give you confidence, that give you encouragement, that give you harsh feedback because it can help you avoid a lot of the pitfalls. But just assure you surround yourself with the greatest people. And for those of you who are here because you are, you're slaying it away at the 9 to 5, and you have this inherent need to go and make something and put it out into the world. I'll say this, and Charles, you have seen it a number of times. When I see our brand, when I— my wife during COVID was at a vaccine clinic and one of the doctors— my wife's a nurse and they were bringing people through the assembly line and giving shots and everything. The physician on her team yells out, "Hey guys, you gotta see this. My child's in childcare and they have the cutest app and here are all these pictures." And my wife yells out, "My husband invented that." And the doctor was like, "Yeah, right, yeah, right. There's no way." But you just get those prideful moments in putting something into the world and, you know, building a team that makes these beautiful things. There is nothing more intoxicating.

Yeah, no, I agree. There's nothing more rewarding than building something bigger than yourself. And ideally, you know, from a founder perspective, that can go on without you. So huge round of applause to the two of you. Thank you so much. Just before we go, a couple things. So for people that— if you're interested in finding out, like, what your entrepreneur DNA is, we kind of talked about it before. I'll put it into the chat here. But just as a quick tour, you can take the assessment on your own, it's free, basically. So you just fill this out, you can pay a little bit extra to get to like the more detailed report. But for example, it can then give you the types of profile that you are. So, you know, for example, are you the hustler? Are you the innovator, the machine, the Prodigy, the Strategist, the Visionary, the Architect, the Inventor, the Achiever. Um, so we see a lot actually, uh, like co-founding teams sometimes will take this, and then that way they can kind of figure out the strengths and weaknesses of each member of the team. So it's been really helpful. So feel free to fill that out if you're interested. You can also then find out information if you want to apply to Founder Institute, and you get more questions answered there, and then our team can always help you. So huge round of applause. So we're gonna kick everyone else out. We're gonna go back into the main room. So Scott, Charles, you're free to hang out if you want, or you can take off, but we appreciate all your time and continued success on your journey. And then for everyone else, there's an opportunity to network and talk for a little bit. So I'll meet you over there. And for everyone else, happy Canada Day, but thank you everyone for attending and This is July 4th week as well, so hopefully we can slow down a little bit towards the end.