Venture Voice – interviews with entrepreneurs

Entertaining Entrepreneurship

VV Show #51 – Jeff Stewart of Mimeo, Monitor110 and Urgent Career

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Jeff Stewart needed that done yesterday. Jeff became an entrepreneur when he founded the web consultancy Square Earth in 1995. Only three years later he became a serial entrepreneur by starting Mimeo, a service that lets you send a file directly from your computer to be printed, bound and shipped overnight. Mimeo struggled in the dot com crash of 2000-2001 just as it was getting off the ground. Jeff was able to pull Mimeo though the downturn despite almost running out of cash, which has allowed the company to flourish and make $55.4 million in 2007 revenues. Ironically, Jeff didn’t have the same success in good economic times with ample cash after he raised $20 million for Monitor110. He discusses the company’s shutdown and lessons learned. Now Jeff’s focused on allowing businesses to hire good salespeople faster with Urgent Career. He announces on this show for the first time that he’s just raised a six-figure angel round to speed up Urgent Career’s success.

1:35 Entrepreneurial beginnings: yard work – “They paid me for it and I was hooked.”

2:25 College at Rensselaer Polytechnic Institute, early experience in management consulting, and first exposure to the internet.

5:15 Business ideas for a young internet

7:00 Dealing with misfires and a return to consulting “We had a big competitive advantage: we owned suits.”

9:55 “Consulting companies are not particularly good businesses. There’s only so many hours in a day and you can only hire so many good people.”

11:53 Exiting the consulting business: “I’m a believer that you only get to sell you business once, so you should do it often.”

12:14 “You only get to sell your business once, so you should do it often.”

13:05 The origins of Mimeo: “It was a bad idea in 1992, but by 1998 it was a great idea.”

17:05 Early financials: $20M round of financing, expected to be followed by $300-$400M round in preparation for a $1B+ IPO.

20:05 Keys for success through the downturn: Highly scalable business, a real business problem that needed to be solved, and a huge market

21:45 Reducing headcount

24:20 Raising money in a down market

27:10 “My memory of 2001 was pitching to raise money and firing people.”

28:50 The state of Mimeo today

31:20 “Mimeo focuses on career critical documents.” “Talking with the customer really differentiates ourselves.”

32:45 On leaving Mimeo and finding a new CEO

34:30 “It’s a lot easier to start a business if you already have customers.”

35:05 The genesis of Monitor110

38:00 Long-term needs of Monitor110: 1) real-time, 2) internet scale, 3) Boolean and Bayesian matching systems, i.e. powerful algorithms

38:40 Halted production on alpha version to focus on beta version: “a major strategic error”

39:40 “Raised close to $20 million… found out it was going to take longer than expected.”

42:00 Winding down the company (Jeff’s business partner wrote a Monitor110 post mortem)

44:20 Comparing Mimeo and Monitor110

47:10 Lessons learned: 1) “I no longer believe in Hail Mary business models.” 2) “Focus on business models that aren’t so capital intensive.”

50:40 The next idea: Urgent Group, explore business models that are more efficient with our customers time.

52:40 Major problem: “The governing factor for growth is … how quickly can you scale the sales team… You just couldn’t get enough great sales people fast enough.”

53:55 “Even at Mimeo… a lot of the venture dollars went to hiring sales people who didn’t work out.”

54:10 Launched Urgent Career, find and screen sales people using computational linguistics, i.e. figure out the quality of salespeople and the type of sales they are best suited for, focusing on fast growth companies.

57:55 Current state of Urgent Career: ten employees with a six-figure angel round plus personal investment.

59:00 How do you determine how much to raise in an angel round?

1:01:25 Dabbling in GreenTech: “GreenTech will make the telecom bubble and the internet bubble look like a speed bump.”

1:04:00 “I believe there are plenty of opportunities in GreenTech that can be done in a capital efficient manner.”

1:05:00 What’s keeping back GreenTech: “The bottleneck is not enough entrepreneurs digging into this.”

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