ABOUT THE EPISODE
In this episode, we’re joined by Steven Greenberg: Co-Founder & CEO of Totem VC, a modern operating system for fund managers. Steven started as an Associate at ff Venture Capital, and was also the Co-Founder & CTO at Unroll Me. In 2015 Steven and his co-founder set off to build Totem VC to solve the pain points that arose on a daily basis.
Steven is a visionary, having founded his first company at age nineteen, and he’s got some amazing views on things going on in the markets today, but also what’s in store for the future.
[00:06:51] Steven Greenberg: Yeah, I think that I would consider them early in the micro VC evolution.
[00:06:54] Jeff Williams: Yeah. And so what’s interesting about that is that the dynamic I’m describing, which is “Hey, we’re not like the old school venture firms that are on fund 18.”
[00:07:03] What is the same dynamic that causes a lot of things to be rethought. And the thing that you and I had talked about previously, by the way, I didn’t know that was the origin of the name Totem, and I think that’s super cool. I love it. But what we were talking about previously was how there’s like a new breed and for a long time, I think there was a question of, okay if you are one of these old school firms with 50 years of track record, consistent returns to LPs, your LPs aren’t sort of saying, oh, we need you to be data driven and provide all these.
[00:07:33] It’s like we’re an LP, we’re just trying to get into these oversubscribed fonts. We’ll take what we can get, but there is this new breed and they operate differently and they’re just saying Hey, we’re going to do things differently. And technology is a big part of it because it happens that much of the investment opportunity they’re pursuing is early stage software and technology.
[00:07:54] And I guess if you stopped me now and said, okay what’s your take? Totally seems to be this super cool organic evolution of that coming from out of one of those firms where it was like, Hey we don’t really find the thing that suits our needs. We’re going to build this ourselves and solve a problem that is logical, and at this point to stop and solve versus, Hey, we’ll figure that out in 15 years, it was like, no, let’s spend the next 15 years operating differently, quickly using technology data, stuff like that.
[00:08:22] Fair characterization?
[00:08:25] Steven Greenberg: Yeah, I would say that the new crop of funds that came along, at the micro VC stage, I think a lot of them are rethinking the process for how venture capital does technology. Then of tools that were being used to facilitate the process, whether it was, automating diligence or just creating operations tools.
[00:08:39] We work to make things more efficient all the way through, I’d say full-blown platform, which was this, black box term at the time of firms that were trying to differentiate themselves with services. And FFVC had an interesting in-house accounting. So the idea being that, you’re an early stage startup, you might not have built out a finance and accounting function.
[00:08:58] Perhaps one of the founders is quasi doing that on a quarterly basis, but you really want to have the depth, not just of being a bookkeeper, but being able to do strategic plans. So that was one of the value adds that FFVC was able to provide, was to add cost accounting to all of the portfolio companies.
[00:09:12] Now that’s certainly created a bit of a situation where we needed to have a Chinese wall, because nobody wants to think that there’s an open kimono of data coming from the accounting firm to the VC fund. But I think on the whole, it was a value added service that it’s early stage founders loved having. And a full stack team of strategic climate talent that they could tap into, whether it was them modeling out their next raise, or figuring out their pricing model, figuring out their burn rate and how to manage against that.
[00:09:41] So there were a whole slew of different firms doing it in different ways. I’d say, First Round Capital, was probably the biggest name at the time was, you know, reinventing what was called platform.
[00:09:52] Jeff Williams: Yeah. So going back to the kind of problem and you guys jumped in to solve, we’ve discussed this previously…
[00:09:58] I mean, different origins at Altvia obviously, I mean, we did get started very much in the pipeline CRM stuff, but there came this point in time and in large part, a lot of the experience that I’d had previously was like, look, you can be on the investment team and be asked for information during fundraising, right?
[00:10:19] Like let’s dig into the track record this way or that way, or what’s been the performance of this thing. And even being on the investment team being asked for that, I found myself often like, where do I go for that? Right? In theory, I’m the creator of that data and I’m still sort of…
[00:10:35] I don’t know, and again, that’s not this gun to your head problem. But the practical problem is that I’m going to be here all weekend. Like very little sleep to try to hurry and get some things scrambled. And for the most part, I’m going to be pulling data that has huge governance issues, if you will, right?
[00:10:55] I might have to go through something like a board deck or PDF of financials and then I have to key it in. And I don’t know if they’ve revised or maybe there’s a V2 on someone’s desktop that’s not on the shared server. And so I’m getting the right stuff, but I’m taking it all from different places.
[00:11:10] And typically gonna go put it into Excel. And then all of this is error prone, things that I’ve done here, versioning king, the number wrong or wrong calculation, stuff like that. And then it’s okay, I got this. Right. And I always was like, man, I don’t know. It doesn’t seem like it should be that difficult.
[00:11:28] But I say all that because the way we looked at it was very different. And I think that’s ultimately, very similar minded companies today, that play in pretty different spaces. I told you when we were first chatting, I guess frankly surprised we don’t bump into each other more often, like on a competitive front, our approach was one where it was like, okay there are systems doing that.
[00:11:49] And most of those systems that we’re doing fund accounting or portfolio level accounting, or at least financial reporting were these old school, big, heavy, very expensive solutions.
[00:12:10] So we focus on how do we get that information? Right? A lot of those companies evolved to have portals themselves because they had that information, all it was was to display it, but it was like, that’s a really intimate step in the relationship with firms. For us, it was a CRM makes sense to be managing that relationship at least have insight into that as a relationship activity, maybe gain some insights from what they are looking at?
[00:12:39] And maybe I talked to them about that. So we took a totally different approach and all that to say, a little bit rambling, but all of it to say that, we’ve ended up playing in slightly different spots. And I think what you guys see a lot of is that emerging manager, right?
[00:12:57] Steven Greenberg: I think what was interesting is when we came to the realization that what we were building could be useful to many other firms. We started, naturally, as investors who do lots of diligence, and other companies doing diligence on our own product and talking with all of our peer funds and trying to figure out what was the value of what we had built. How much could you potentially charge for something like this? What structure would need to be around it? And what was really interesting was we kept talking to firms and what was so validating to us was the fact that so many firms are going through the same exercise of hiring a software engineer and trying to build out the same views that we were building out.
[00:13:29] Everybody was seeking something that tied together everything they were doing in the front office to give them that global view of how their funds are performing both at the GP level, and obviously you care more so about PTO fund performance, where as, maybe someone like an analyst or an associate just cares about any given deal at a certain point in time.
[00:13:47] And the fact that so many firms were hiring software engineers, which was not in their core competency to build the same exact tool that we were building, I think was very valuable. And knowing that, we were onto something.
[00:14:00] Jeff Williams: So is it the case today that a lot of the folks that you’re working with are still on that emerging ish type side?
[00:14:09] It’s typically a quick, very straightforward, very repeatable way for firms that don’t have all this institutional process hangover and cultural struggles to commit to technology. These emerging firms I’m referring to are sort of born that way?
[00:14:24] Like it’s in their DNA. Are you guys still seeing a lot of activity with those guys?
[00:14:28] I mean, the thing ultimately I wonder about is whether there is somebody else on the trail here. Right? And some of these older kinds of stodgier firms are like, oh wait, we’ve been together for 45 years and that’s really the story.
[00:14:43] But what it comes down to is if technology has an opportunity to transform those firms. People are gonna use it and there might be some people not very open to bidding.
[00:14:54] Steven Greenberg: We primarily work with three buckets of customers. On the one hand, we work with really small emerging managers.
[00:15:00] Sometimes it’s just a single individual making investments who perhaps doesn’t have the pain points that we’re solving for from day one, but wants to put in place a system that will create a backbone as they’re scaling. I’d say the second group of customers that we typically find, we engage with are firms that are going from fund 1 to maybe fund 2.
[00:15:17] They did things on the back of the napkin, spreadsheets, it was just a few family and friends that were their LPs. And now they’re raising funds and looking to get more institutional capital to come in as an LP base. They want to do things properly.
[00:15:30] They saw how things can go sour. If you don’t have systems in place and want to correct things for fun too. So we’ll typically step in at that point and help clean up the past and help them set up the foundation for them to continue raising new funds all the way through your larger funds who perhaps already, past the point of facing these pain points and maybe come in with a specific need, whether it’s around collecting financial data.
[00:15:51] I think that’s probably one of the bigger things we do for firms, especially in the VC space. There wasn’t a lightweight way for firms to be able to collect information from their companies. I’d say at the PE level and probably, what you guys are dealing with there are a few vendors I’d say, which are cost-prohibitive for the venture guys and probably overkill, right?
[00:16:09] In the VCs’ cases, they typically will need four or five high-level metrics. How much cash does the company I’m going to have on hand? How much do I own? And what’s their latest revenue metric? That alone is something that is difficult, especially in the hundreds of companies to be able to achieve on a quarterly basis. And we’ve helped automate that process.
[00:16:29] Jeff Williams: Yeah, super cool. How much, I’m curious to get your take on what’s going on, like in more buyout type stuff. You just mentioned it there.
[00:16:39] The thing that’s become really interesting to me, in my head, this all started as okay, the information at some point is different information. You’ve got fund accounting, you’ve got portfolio company reporting, all that stuff.
[00:16:52] At the end of the day, all that information is good to have, but really the point of it is to provide it to constituents, right? We’re in a world firmly today where information is everywhere. And to think that in this market, you couldn’t be an LP with huge dollars, committed to the asset class and sort of struggling to get information about where the money was outside of cryptic PDFs.
[00:17:11] But more recently with the bio stuff. What I feel like at least from my purview is it’s shifting a little bit. And I’m wondering if you guys see any of those too, but there’s now technology emerging and a lot more on the competitive investment opportunities.
[00:17:31] Which is to say, before all that information is even appropriate, we need to use technology and data to find companies faster and before somebody else or find better, investment opportunities. So there have been a couple of things recently that are interesting to me, like the availability of information to venture and private equity firms.
[00:17:53] And I think there’s some venture firms that are doing this. Probably in a way that’s pretty amazing and they’re pretty secretive about it, but just the idea that, how could technology and how could data allow us to find companies faster, find them actually proprietary instead of using the term proprietary to mean we’re all calling the same banker and hoping that we get into the deal.
[00:18:16] What do you see on that front? Is there anything going on there that you?
[00:18:19] Steven Greenberg: Yeah, there are a lot of firms that like to call what they built their special sauce. I think there are some firms that have gone and really built out proper data science teams. And you can see that, based on their head count and the kind of people that work at the firm that there’s really something to it.
[00:18:34] Whereas others are, perhaps, pulling data via an API and doing some sort of simple sorting algorithm on it. I wouldn’t necessarily call it all that sophisticated, but in any case, I think these firms see what they’re doing as their special sauce whether it’s procedural or whether it’s access to a certain data source that nobody else has access to.
[00:18:53] It’s definitely, I think, more oversold than reality from my perspective. I think a lot of the firms are still facing trouble with the ABCs, right? How much do I own a company is a hard question for a venture capital firm to answer. So it begs the question, whether they are able to have some sophisticated engine that’s going to find them the next Google? It’s a hard leap to make.
[00:19:15] We very much like to think we’re solving a lot of the nuts and bolts of data capture and display issues. And then enabling the firms that do have the additional bandwidth to be able to build on top of that, with whatever version of their special sauce they want.
[00:19:31] Jeff Williams: Yeah. Love that. I was having dinner with someone last night and I was joking on this topic, that for some firms it’s like, oh, well, our team’s been together for 15 years. So has everybody else, right? Like that by definition, can’t be your special sauce.
[00:19:44] You might make better investment decisions, but how do I wrap my head around that? What is there that’s not so subjective and qualitative to support that? And it’s like, well, here’s the technology we’re using, and you’ll have a deck during diligence. It’s got a screenshot. That’s right.
[00:20:00] It’s like, well, could we log into that? See what it looks like. Yeah, we can’t show you that. And really what that means typically is we don’t use it. We just use screenshots of it right then. And that’s okay. I’m not here to judge the decision to do that nor the LPs that backed that.
[00:20:18] It’s been about a year, almost exactly a year, maybe since I saw MSCI announce a partnership with Microsoft, but I thought it was fascinating.
[00:20:28] And MSEI of course is a very interesting player. I think they’re gonna be the first to sort of quote, unquote, win the ESG data game. But super interesting in terms of a very data-driven company in capital markets and then partnering with Microsoft to use Microsoft AI technology, which is world-class at scale. I think the press release said something to the effect of “to provide better investment decisioning.”
[00:20:55] It’d be really interesting to see how that plays out, because in theory for me, it could be that if MSCI can properly grab the data, and Microsoft can apply world-class AI technology at massive scale with very low cost that like, we may not be that far from the day where instead of people looking at sourcing as this thing of like, I have to make sure I call this banker every 15 days.
[00:21:24] It’s like the only reason you’re calling the banker is to have him tell you about a company. And maybe there is a point in time. This MSEI Microsoft stuff at least is the poster child in my brain. Like, nah, we’re telling you to call that company before everybody starts calling the banker, so it’s super interesting. I don’t ever think we’re going to have this market be transactional. Obviously there’s a lot behind investment decisioning and the process of digging into a company, at least on the sourcing front. It is so competitive, but it’s not that far fetched in my mind to think that people are going to start putting a lot of resources towards using data to bind the targets before anybody else.
[00:22:06] Steven Greenberg: Yeah. I would say I’ve been seeing a bunch of new tools creating signals that are novel at least to me. Firms that are scraping team pages, different startups websites and seeing what the company’s hiring for, which is obviously an indicator of what direction they’re headed.
[00:22:26] They are capturing screenshots of the pricing pages and seeing how that evolves, which might inform how the product has changed or how the value proposition of that particular company has changed. They’re scraping SEC documents to see the new filing of companies.
[00:22:40] They’re looking at LinkedIn title changes to see if somebody just left one of the big tech companies and perhaps is going to start a new company. So I’ve been seeing a lot of new data signals that are being created. I think firms are still grappling with how to tie that together with their process to actually make those signals useful.
[00:22:57] Jeff Williams: Yeah, totally. I love that you use signals, because one company I really started to see this in early on, and I’ve mentioned in the podcast. It’s DataFox, which is a company that uses the term signal to capture these things, and then provide them to you. And ultimately I mentioned it because it, I think it reinforces your point, which is Hey, the signals are out there and the filings.
[00:23:20] What does it mean to you? What are you going to do with that information where there’s still a sort of huge opportunity for differentiation and for strategic weapons for firms, right? To say Okay. So the pricing changed. All right. What does that mean? Should we call the company or not? Or when do we call the company?
[00:23:38] And that’s what is still kind of left open which I love because people, if they focus less on how do we hire software engineers? Which to your point, we don’t have experience hiring. How do we use what’s available and then what do we do with that information and how is it actually differentiated? It’s a fascinating topic.
[00:24:00] Steven Greenberg: Yeah. And another one I’ve heard is looking at the customer logos. Obviously a lot of SaaS vendors will have their big customer logos at the bottom of testimonials. So being able to scrape those and see if perhaps, you have a new fortune 500 that became available.
[00:24:13] So those are really interesting signals that now exist by some of these data providers that are aggregating it. Have we spoken to this company or this company? I think we need to get the ABCs right.
[00:24:28] And I’m hoping we can be the player that helps them get their ABCs right. To allow them to work on how they differentiate and what is their strategic weapon.
[00:24:35] Jeff Williams: Yeah. And it’s sort of like the Mars conversation. Right. Really sexy thing to think about, like, hey, people are going to explode on the launch pad, while before that and bringing it back to this.
[00:24:49] People are really fumbling with some pretty basic stuff. Let’s not get too carried away, but it’s still one of those topics where I catch myself. What’s that going to be like? And I don’t think there’s any question that it’s going to change, and we can only make the best assumptions now in terms of how it will change, definitely going to be some time.
[00:25:09] But super interesting in this market, given how competitive it is to think what will people do with that? And will it be this thing that really does finally flip the tables in terms of as an LP, looking at these emerging managers like, nope, this isn’t actually differentiated. We weren’t betting on this horse because we really think that what they’re doing will lead us to better returns than the alternative.
[00:25:30] Steven Greenberg: Yeah. I think the other thing that’s going to help here is the fact that a lot of new data sources are being digitized. So I’d say the big one driving the possibility for future analysis is the fact that now deals are being syndicated online.
[00:25:44] Right? Whereas as a single investor, perhaps you’ve done hundreds of investments that’s not a meaningful enough data set to be able to really glean too many insights. But now that there are tens of thousands of deals being syndicated online all with structured data.
[00:25:58] I think the ability for somebody to come in and build an analysis layer on top of that and the performance that has been driven in different sectors at different times, with different types of investors that sort of things, I think start to get interesting from a data play.
[00:26:09] Jeff Williams: Yeah. The thing that’s always so fascinating is that you look at something like this and then you say okay so, the example I used last night at dinner was one of the things that’s probably a little bit less available, but which isn’t far fetched to think about being able to capture, but years ago we figured there were close to a hundred thousand privately owned companies that had survived dot com and were bootstrapped.
[00:26:31] If you look at that timeline, there’s a lot of founders probably coming up on college, and could use a little liquidity. And that’s why, these firms, these growth firms have heavy outbound models. Just go find them, but take one of these companies and say, all right, maybe in a local newspaper article about this founder’s daughter say, right, who’s like the valedictorian or high school.
[00:26:57] And is a superstar field hockey player, who’s got a scholarship, right? So this is all like text inside a local news article. It wouldn’t be hurtful to know this information. Right. It’s okay there isn’t a banker that the founder has gotten to yet, but there might be an interesting story and it’s a very basic example and might not even be super easy to do.
[00:27:18] Right now because the signals and the filings are more sort of structured at least a little bit, what could you start to do with that? And then the point that I was going to make is that maybe that’s a good thing to know. Maybe that’s a good investment opportunity.
[00:27:33] Maybe it is differentiated, stuff like that. Once you get some repetitions with this stuff and machine learning models. It starts to tell you to do more of that, that’s working, or don’t do that, that doesn’t work.
[00:27:44] It’s unique, but there’s nothing in there. There’s no ponies there.
[00:27:48] That’s now this compounding effect and we’re living through the golden age of these technologies worldwide and all sorts of markets, it starts to become really pretty interesting. Could you read this market?
[00:27:58] I wanna get your big prediction, whatever it is. And it could be about Mars you want, but obviously we’re both equally fascinated with this market because it’s our day job.
[00:28:10] What haven’t we talked about that it’s going to happen or is coming?
[00:28:14] Steven Greenberg: From my vantage point is the rise of the individual investor. The world of venture, I think, has exploded. Or really the private capital markets have exploded. You have on the higher end, public markets that have started believing in the private markets because private companies have been staying private for a lot longer and raising a lot more capital.
[00:28:29] So there’s been a shift on the higher end, but on the lower end of the spectrum, it’s now a lot cheaper to start again. The ability for a smaller check to be meaningful to that company has also grown, you know, these micro VC funds, accelerator models, studio angels. And I think what angels have realized is that in order for them to really be a meaningful investor on a cap table, they can join together as a collective and invest in companies.
[00:28:54] I think you’re now seeing this rise of the individual investor, and these SPV instruments quickly spin up an entity, have it funded and deploy capital out of it. And I think, you know, what I equate this to is similar to the way AWS made it easy for developers to deploy code.
[00:29:15] There are a whole bunch of new tools that have been created to make it easy for investors to deploy capital, and that’s the macro theme. I have more specifics on like, who are the players? I’m sure you’ve heard of this new concept of rolling funds by angels. They’re trying to change the model of how a LPs quote unquote, subscribe to a fund instead of commit to a ten-year fund life cycle.
[00:29:38] There’s this tool called Assure, which is purely playing on the SPV side, just making it a few clicks to spin up entities. So I think there’s been interesting developments as far as people building for the individual investor. And crowdfunding as well, becoming a hot topic.
[00:29:55] Jeff Williams: Yeah, totally. Well, the thing that I think about immediately. Or like, those are two big themes in financial markets generally, right? Like democratization of things.
[00:30:05] And then also creative ways to take advantage of liquidity. We may have just lived through a period with the SPAC mania. But, beyond SPACs, which was sort of the poster child, I mean, I’ve said this a couple of times, even on the podcasts. I don’t remember ever seeing so many creative ways to put money to work.
[00:30:30] The SPVs included, it’s wild, so much liquidity. And I don’t think that we’ll go back. Maybe there won’t be as much liquidity, but to your point, like the way that the capital is coming together and people are collaborating, it’s fundamentally going to change things.
[00:30:50] Steven Greenberg: What are your thoughts on finance-based or I guess revenue based financing? That’s also now another topic that’s been tried to be proven out. There’s a, I don’t know if you’ve heard of Indie VC so they tried it and they failed. I forget what they quoted as the reason why they failed, but that’s something that I’m hearing about as well.
[00:31:08] Jeff Williams: Yeah, it’s interesting too. I didn’t know a whole lot about what they’re doing, but I do know Bryce Roberts from Indie and OATV as well. And yeah, honestly, I don’t probably know enough to say much intelligently about it. However, the first thing I think about when you say that, and it’s appropriate in this case that I don’t know much about it because I’m immediately sort of like, it’s gotta be something creative, but in a way it’s also at a simple level, like the basic concept of, local bank lending.
[00:31:38] You know, I’d be curious. I’m not even sure what the distinction is. It’s certainly gotta be something, but tell me, what is it, what does it mean?
[00:31:47] Steven Greenberg: Yeah, I mean, I think the idea is, for those who don’t want to go swing for the fences and immediately have to paint themselves in the division of what they’re doing as a venture backed business you can raise capital in an instrument that would allow you to have a lifestyle.
[00:32:04] And would allow you to pay back your investor in the form of a dividend, but also it would be almost like a convertible note in the sense that the investors investing technically in future dividends, but that may convert into equity if you do choose to shoot for the moon later on in your company’s lifespan, but you don’t necessarily need to be selling that to the investor from day one.
[00:32:23] I think that was the initial idea of it was it’s almost a convertible debit.
[00:32:28] Jeff Williams: So some distinctions there, some nuance, but you know, for the most part, it’s just maybe this big sort of rotation in the way that capital markets provide capital. I mean, it’s not that terribly different from a more traditional kind of local lending, which isn’t to your point, swing for the fences? Interesting stuff.
[00:32:50] Steven Greenberg: I like the fact that venture capital has moved from being a single block on Sand Hill Road, to now being a lot more global. And now giving access to individuals to be able to participate in the private capital markets in a way that they haven’t been able to in the past.
[00:33:03] So I’m excited for the possibility of myself being able to do this, while I have a day job running Totum VC, as well as seeing a whole bunch of people that previously didn’t have access to this asset class, be able to participate. And I think it’s gonna bring a whole new wave of innovation in the kinds of companies that get funded, because it brings a whole new type of thinking, in the way you’re approaching making investments.
[00:33:25] Separate from that, I’m pretty excited about the brain, which is just a completely unrelated topic. And I think we are also in the golden era of figuring out how we can really deconstruct the brain. I love the mantra now in the valley is, ‘aging is a disease.’
[00:33:40] And it’s just something that we’re destined to figure out how to solve. And I think everything around anti-aging is super interesting. And I think we’re going to see massive strides. I think a recent headline actually came out that the children being born in this generation could possibly live up until 150 years old. And that’s by like reputable scientists who have put together that study so that will obviously change a whole lot about the world, and certainly about the ways in which people are living their lives. And when they decide to do major things, like get married or have children.
[00:34:10] Jeff Williams: I love that. It makes what we’re talking about. Private capital markets seem pretty basic when you think about it. What will the world be like as a result of that? Super cool stuff. I want to throw something out there real quick. As we wrap it up, you started a company that provided a service I loved, and you briefly mentioned it, but Unroll Me.
[00:34:27] I didn’t actually put that together, but I remember the day when it was going away. It was a very tragic day for me. It was a great service. This is silly how much time you spent being assaulted, frankly, in your inbox by people and had to be a better way to stop being assaulted and just move on with your day and get through your inbox.
[00:34:54] I’d love to hear just a little bit about that.
[00:34:56] Steven Greenberg: Yeah, everybody knew the email was broken. The Genesis was that we wanted a tool to be able to kind of fix the mistakes we made throughout the year. And the bad email habits that we had, perhaps the assault that other people were putting onto us by giving people an easy spring cleaning tool that they could log into, scan their inbox list of all the newsletters they were signing up for.
[00:35:17] Basically click checkboxes and decide which ones they wanted to unsubscribe from. Ironically at the time, this was before laws that came out around how people can send emails called the Can Act. We were behind the scenes brute force, clicking at the bottom of the email where it says unsubscribe.
[00:35:33] And in some cases, filling out a form with your email address, clicking yes. Remove from all. And it turns out that at the time that we were doing this, which is about 10 years back now, when you actually went and clicked on the unsubscribe link on some of these spam emails, you were actually then subsequently selling your emails to other spammers.
[00:35:50] Now this indicates that you were an active email. So in the early days we actually were creating more spam and people were coming in saying “I’m not really sure your product’s working as intended.” We ended up moving away from actually trying to unsubscribe you, to a simpler approach, but harder from a technology standpoint, which was instead of us trying to actually get you off of those lists at the time of you receiving any.
[00:36:14] We would just take that email quicker than you can get a notification on your phone and stuff it into a folder and mark it as read. I think the real aha moment, beyond just being a tool that would help you get rid of your subscriptions, was can we take the things that you did like getting, for example, at the time Groupon and living social, were still very popular.
[00:36:34] People like getting those kinds of emails, but I kind of categorize them as they abuse you, but you’re tolerant of it. So for those kinds of emails, we came up with something called the roll-up, which would hide those emails from hitting your inbox.
[00:36:48] And once a day, you would get a digest of all those emails that you can quickly glance through and see if there was something of interest. And I think, what would have happened beyond that? You know what I was excited about that we never got to it, and I still think it’s something that could be especially with the amount of content now, like the amount of newsletters that exist, the amount of podcasts that exists there should be the equivalent of an app store for signing up for a newsletter, right.
[00:37:11] In the same way that you’re very willing to go and download an app because at any point, if it’s not providing value to you, or if it’s not working as expected, you can pull it down, click an X button and you’ll never see it again. We too thought we could do the same with newsletters where you can almost like taste tests, a newsletter in your digest.
[00:37:29] See what kind of content was brought to your doorstep and decide if you wanted to have that, as a long-term Subscription. I still think that part of the puzzle has yet to be solved by anybody, but I still think it is very much relevant today. As other channels have gotten really noisy and email now has become, I think, a sacred place again.
[00:37:48] And it’s interesting like, you know, I would say physical mail, right? It used to be that physical mail got too cluttered because of how much stuff was getting sent to you. And now nobody sends physical mail because it’s just too expensive. They’d much rather put their ad dollars towards digital. So now physical mail has become a great channel again.
[00:38:04] So it’s interesting how the pendulum swings.
[00:38:09] Jeff Williams: That’s fascinating. I love that. I think that’s outstanding. I’ve never heard that, put that way, but I agree with you. I think that’s fascinating. I love the way you think your brain works. Super fascinating.
[00:38:21] Thank you. Thank you for joining us, sharing some thoughts. Last question two, favorite music. This is a private equity technology podcast, but we make all the music in house. And so you just have to throw in something. Favorite band, like what was the first concert song?
[00:38:38] What moves you? Like you have a really fascinating way of thinking. It’s gotta be something in there music related.
[00:38:47] Steven Greenberg: Staring at my record player, which my father would be proud of that probably has 15 to 20 Beatles albums beneath it. I’m a big fan of the Beatles. I love the mania.
[00:38:57] I watched a 10 hour documentary. I think there will never be another Beatles and I’m sad that I didn’t get to live through the craze that existed. I love the fact that, with vinyl, you can listen to something and you’re required to be an active listener.
[00:39:13] Whereas with Spotify, I can just put shuffle on. I’m barely listening. It’s in the background. It’s shuffling between genres. There’s definitely a love for vinyl that I’ve come to appreciate, and I would have to go with the Beatles, just given the legends that they are.
[00:39:27] Jeff Williams: Absolutely. And I think it’s like one of those things where they are so legendary. They’re great. But there’s so much to dig into and you never really get through it all and it just gets more and more fast. And a lot of people, don’t necessarily ever do that and accept perfectly fine based on just a few inputs.
[00:39:54] Steven Greenberg: I think actually one, one cool thing about the Beatles that I learned from this 10 hour documentary is, they were very much a band that was just the boy band that would play feel good songs at a concert, sell out massive stadiums all around the world. So they were creating music designed around, being able to sell out massive stadiums and play and just play live.
[00:40:12] And at the time there were limitations around what could be played live, there weren’t the same level of effects that are possible today. So there were certain things that were only possible in a studio setting and I think the manager of the band didn’t want them to do anything other than produce songs that were meant to be played live, which limited their ability to be as creative as possible.
[00:40:33] And there was this breakthrough in technology and music that eventually enabled them to start having these sounds played live. And I think that’s when you start to see a complete shift in the kind of music that they play. And it’s only really when you watch the sequence of how the songs came out and the layers of complexity that are added to it, where you start to appreciate there’s more to music than just bands being in phases at different times of their lives.
[00:40:57] Jeff Williams: Oh yeah well, and a lot of guitar players that really studied the Beatles stuff will tell you that it was an early form of an algorithm. The music that they were playing in, a lot of cases covers early on. Like they’re finding what people like, and if you trace back the sort of DNA, which is subjective, these guitar players would make a strong case that you can start to see traces of what was popular, you know, like Netflix creates content.
[00:41:26] They know it is interesting because they know what you watch. Right? That starts to enable you to create music yourself that is reasonably, fair to assume people will also like, and you can start to see some of that DNA and in terms of the composition and music and stuff, so brilliant stuff across the board and some good timing perhaps to your point about the amplification of sound and all that sort of stuff.
[00:41:51] But, very little question in my mind that are total legends. It’s hard to argue against that. So love it, Steven. Thank you, man. Awesome conversation and love what you guys are doing and wish the best for you. And I just, I’m now just personally, super interested in following you and just seeing what you’re up to and what you’re thinking about.
[00:42:12] So thank you for sharing some of it with us and wish you guys the best of luck, man.
[00:42:17] Steven Greenberg: Yeah. Thanks for having me.