The Art of Calibrated Chaos: Balancing Disorder and Strategy in Startups | The Pair Program Ep28
Join us for a conversation with two remarkable startup entrepreneurs who have successfully navigated the tumultuous world of startups and managed to bring order to the chaos. Our guests, Molly Hill Patten and Christian Duffus, share their inspiring stories and invaluable insights into how they’ve turned startups from a whirlwind of uncertainty into well-structured and thriving businesses.
Philanthropy
- Greyhound Welfare – https://greyhoundwelfare.org/
- New Literacy Project – https://newslit.org/
- Rock Creek Conservancy – https://www.rockcreekconservancy.org/
Transcript
Welcome to the PAIR program from hatchpad, the podcast that gives you a front row seat to candid conversations with tech leaders from the startup world. I'm your host, Tim Winkler, the creator of Hatchpad,
Mike Gruen:and I'm your other host, Mike
Tim Winkler:Gruin. Join us each episode as we bring together. Two guests to dissect topics at the intersection of technology, startups, and career growth. What's up everyone? We are back for another episode of the Pair Program. I'm your host, Tim Winkler, accompanied by my co-host Mike Groin. Mike. Y if folks are wondering, it looks like, uh, you are calling in from a different location. Uh, you are working outta your parents' basement. Is this accurate?
Mike Gruen:Yeah. Uh, almost accurate outta my parents' house. Yes. We're we're visiting family This for, for the holidays. Okay. The Passover holidays, although,
Tim Winkler:Did you enjoy my Wayne's my Wayne's World gift, though? Yes. I The, yes, the
Mike Gruen:Wayne's World gift, right? Yes. I even, even reacted was very, it was spot on.
Tim Winkler:Okay. Um, um, do you have a favorite, even to,
Mike Gruen:a little teaser does tie into my pairing, so I'm, I was very please with myself when I came up
Tim Winkler:with it, so, yeah. Okay, good, good. Well, I've got a teaser for my parent too, but it, it'll be more around food related. What is your, what is your favorite Girl Scout cookie? Oh, my
Mike Gruen:favorite is, uh, yeah, fin mint, but you gotta put it in the.
Tim Winkler:Right. Classic. Of course. Okay. Of course. All right, well, there's a little bit of a teaser. Um, well, let's, let's jump in and we're, we'll give the, uh, listeners a heads up on, on what today's episode is about. So, today's episode is designed for, you know, first time founders that are out there, or folks who maybe building very early stage companies. We wanted to put together an episode that helps you kind of create some order out. The chaos, uh, that you might be experiencing. So we'll be covering specifics around, uh, things like strategy, finance and operations. Um, and we'll discuss the, kinda like the level of structure that you may need or, or not need. Um, something that's very top of mind in today's, uh, climate is venture capital as well. So how to best put, um, some of that capital to use in those early stages. Uh, and of course, You know, this type of strategic discussion, uh, we had to bring out some heavy hitting guests. So to provide, um, our listeners with some expert insight, we are very fortunate to have, you know, Molly Hill Patton and Chris Duffy joining us. Um, you know, Molly, you have over 20 years of experience building. Managing and improving, you know, finance and ops teams for multiple, early to mid-stage companies. Uh, Chris, a serial FinTech entrepreneur with three exits to your name. So of course you'll have much to add to the conversation. Uh, and again, one thing I'd like to add, um, uh, with both of you is that you're not only. Startup operators, but I'd consider you both altruistic entrepreneurs as well. Um, you, you both seem very intentional about the types of organization, organizations that you are building, uh, and wanting to do good in the world. So thank you for that. And thank you both for spending time with us on the PAIR program. Um, let's jump into our first segment, uh, which is pair me up. Um, pair me up, you know, we. Gonna go around the room, shout out the complimentary pairings. Mike, as always, you kind of start us off with things. So what, what do you got for us today? Yep.
Mike Gruen:So, as I said, I'm, I'm visiting family. Um, so my pairing is, uh, family and unsolicited advice. Um, it's kind of un unavoidable in my house. Uh, could be talking to my dad or my mom or my sister, anybody about anything. And next thing you. You just wanted to talk and they're giving you like how you should handle whatever situation. Even before I even hopped on, like as I was leaving the kitchen to come hop on the podcast, my dad was explaining to my sister who is older than me, how to best get to Newark Airport and what time she needs to leave in order to meet her daughter, and so on and so forth. So, uh, it's unavoidable. Uh, so yeah. That's,
Tim Winkler:that's adorable. Family and unsolicited, that's parents being parents, right? Do they, do they still ask you to do like little chores? Like, like it's trash night?
Mike Gruen:No, no, no. Um, growing up actually we didn't have a whole lot of that. Most of, I mean, my had some, I had a lot like in the yard work type area, but, um, our job was to be students. Like that was, school was our job. So that's sort of, we had more of that type of stuff. Um, but yeah, the summers, there's a lot of mowing lawns and splitting wood. Um, not so much taking the trash out, although we had a big wood burning thing. So yes, I guess taking the trash out and incinerating it, uh, but
Tim Winkler:incinerating the trash. A whole nother story. Yeah. We had a, we had a full, an all out, uh, we had an all out star chart, my brother and I, um, you know, so you had the, the trash, the dishes and, you know, you had a x amount of check marks to get, uh, you know, your gold star. Anyways. Nice. Um, well good for you. That's, that's great that you're, spend some time with the family. Um, I'm gonna jump in. So my pairing today is, uh, girl Scout cookies, uh, and overabundance. So, you know, I feel like Girl Scout. Cookies at this point. You know, they've gone from like a once a month kind of thing to a, a seasonal thing, and now I just feel like it's gotten outta control in their year round type of sales. Um, uh, and, and throughout that process, I think we at this point have maybe like 10 to 15 boxes of Grill Scout cookies that are just constantly adding up. Um, they're genius. They've strategically figured out a. Get me to open up my wallet year round at this point. But they are, they are delicious. And as a result, again, uh, a gluttonous supply of Girl Scout cookies exist in the, in the Winkler household. So that's my, my pairing. Um, you know, I'm sure each of you each has, uh, a box of Fen mint cookies in the freezer right now, which is a, a staple. Um, but, uh, but that, that'll be mine. I'm gonna pass it along to Molly. Uh, Molly, why don't you give us a, a quick intro and tell us about your pairing.
Molly Hill Patten:Sure. So first of all, my parents did not, Mike did not share your parents' philosophy. My, and I actually don't think there was such abundance of Girl Scout cookies background, a brief stint on Wall Street. And then I've spent the vast majority of my career working with early stage venture back c. Where you wanna put every dollar you can towards building what matters. And so you want just enough infrastructure that you know that you're doing that, but not so much that you're really taking that value away from the product or customer success or what you know, really is gonna help you grow the business. So that's, that's my background. And, um, for my pairing, I recently got back from spring break, so I did come up with a lot of different pairings, but the one is the most family in my mind is EVs and city living because I realized I love driving an ev and over break, we had a rental car and had to pump gas, and I thought, you know what? I never wanna have to do this again. So that's my period.
Tim Winkler:Nice. That's classic. Where, where did you guys go? We went to Costa Rica. Oh, wow. Went surfing.
Molly Hill Patten:So,
Tim Winkler:Shortage station.
Mike Gruen:Also a tie into my pairing because that's where my niece is flying back from. She was in Costa Rica and that's where my sister is going. Newark Airport to pick
Molly Hill Patten:knew airport. I'm not
Tim Winkler:creative. It's a hotspot.
Mike Gruen:It's a hotspot.
Tim Winkler:That's great. Awesome. Well, good stuff. We'll, uh, thanks for joining us again and, uh, we'll pass it over to Chris. Uh, quick intro and, and your pairing.
Chris Duffus:So, uh, I'm Chris, founder, c e o of Phonebank. Um, I've been at this FinTech game for a long time. I can sort of re-engineer anything in payments, uh, that you might think of and how, how maybe even to create any, anything new. Um, I'll sort of, uh, Molly and I actually went to the same business school, so we probably think very similarly at least, and from analytical standpoint. But, uh, so to piggyback on her pairing, I might. In addition to city, with city living is having a dog, um, and, uh, probably even more so than kids. We're both parents. We, uh, sent our kids to a, this the same school at one point, but, uh, I had a dog, a Greyhound for, I still have one for a number of years, and it required that I had to take a walk every day around the city to different places. Um, and unlike a child, like you don't necessarily talk to your dog all the time, or at least, uh, not in the same way. So you spend a lot of time looking at the city and potentially even seeing the city in ways that you never, you, you might not have seen it. And so whether it's in the inscriptions on signs and you take the time to read things and literally, uh, smell the flowers as you walk by, so I encourage every. If you, if you're not, that's one of the benefits is not only walking, but also just seeing, having to see the world. Just because if you pass something 10 times, you know, after maybe the second or third time you might. Um, uh, invest in, you know, Hey, maybe I should like look at this.
Tim Winkler:That's cool. Yeah, I, I've always had a dog. Um, but I've had that, that backyard to where you just kind of open the door and just, you know, let it run out. Um, city living with a dog is very, you know, intentionally have to go out. You have to go explore something. You have to go find, find that patch of grass, right. Um, but, uh, greyhounds are also very, very neat breed. We have a, one of our teammates. Two of them. And it's almost like a community, uh, you know, folks that have greyhounds are, are very well connected to one another. Its so, it, um,
Chris Duffus:it, it's, you have, you have to be, You have to like people to get a ground cuz people fuck you all the time.
Tim Winkler:Good to know they're beautiful dogs. Um, cool. All right, well that is a wrap. Um, so we'll, we'll go ahead and transition into the main discussion at this point. Uh, as we mentioned earlier, we're gonna be talking about finding some order amongst chaos as a founder, especially trying to dial into some of these earlier stages, um, of, of startup, uh, development. So, Like I mentioned earlier, if we get down to brass tax here, a lot of it is gonna be navigating, you know, some core pillars between inter uh, uh, between finance strategy and operations. Um, Molly, you kind of hit on this as well. There's usually a good, you know, small dosage of, of infrastructure that's gonna be in place here, but, you know, these pillars need to be kind of set in place as a, as a good starting point. Um, Chris, let's, let's just kind of start with you. You know, having founded. These three FinTech startups over the years, um, you know, what would you say have been some of those bigger challenges that you faced in those earlier stages of building? And I'm curious of like, what is it that you learned and or kind of course corrected for each one, uh, each of those startups along the way?
Chris Duffus:Oh man. Uh, we only have an hour. Uh, uh, you know, obviously there's a lot of infrastructure you. Create to effectively run a any type of, uh, internet company nowadays, you know, obviously you gotta build the product, you gotta market the product, um, you gotta acquire customers and this, you know, regardless of it's like an a consumer. Uh, B2C or b2b right, or whatever sort of hybrid in between and whatever the particular market might be, and, and go to market accordingly. And so I, I think, you know, the, the, the biggest challenge that we've always faced is, you know, um, um, uh, is, you know, how do I prevent, uh, having to burn the, the candle, so to speak, from both ends. You know, I think what's most important at an early stage company is that early product market fit. And so as you think about what that might mean, it could be some type of customer engagement, whether it's, uh, new users, whether it's paying users, whether it's you. A combination of both, you know, profitable users, um, depending upon, you know, potentially your financing strategy or your, you know, uh, the KPIs that you're going after. And so, you know, uh, that's sort of the multidimensional sort of matrix that I try to, or rubric that I try to solve for is and optimize for, is that okay, we have a certain pot of money, Um, we need to get this early product market fit. Uh, I also potentially have to build a product and whatever that might require, like in FinTech, there's maybe some regulatory, uh, infrastructure healthcare as well, uh, that you gotta do before you even sell $1 worth of product. Uh, I can start getting customers even if it, even if it is free. Alright. Right. Like we can't care for patients and not have doctors or some. You know, regulated sort of infrastructure, same as same as FinTech. Um, and that can add up really quickly and might put most, many businesses, or at least a, a startup or bootstrapped company, they might be able to afford that. So,
Tim Winkler:Yeah, I mean, in, in a regulated industry like FinTech, I'd imagine, you know, you're, you're maybe needing some, uh, larger sum of, of funding versus maybe some sort of a B2C app that you're just whipping up that you can probably get in the hands of folks quicker, uh, without as much red tape. Um, You know, from a finance perspective, you know, I guess it, a lot of it kind of starts here as well. I mean, obviously there's a strategy in place. Uh, I'm, I'm thinking about this in a, in a point where maybe, you know, there's already a, uh, a founding team in place, maybe a couple folks, uh, and, you know, they're, they're getting that seed round, right? So, you know, thinking about it from that, Uh, use case. Um, what is one of the biggest mistakes that you maybe see some of these founders, you know, mismanaging their funds, like, uh, prioritizing where that spend needs to be. You kind of touched on finding that product market fit, so maybe that's, you know, you know, spending and marketing, uh, areas of marketing, um, you know, investing in that product team or that engineering team, you know, a little bit early on as well. You know, from a, a venture standpoint, maybe Molly, maybe this is a good angle for you to, to approach it as well, you spent some time with Revolution. Is have you picked up on areas where it's, it's been a common theme where maybe, uh, spend is being allocated in areas that aren't top of mind in those early stages, or should or shouldn't be, you know, spent in those certain areas, in those early stages.
Molly Hill Patten:I have lot. I have lots of thoughts. One, one is that what the key, and I think this is really important for all founders, is the capital you bring in and that conversation between the source of capital, whether it's youth who's trending, self-funding, or you've got a vc, and knowing what risks you're taking when you're spending that money. Because when you're early stage and you're small, One of the risks is that you read too much and you have an N of a small N. And this is particularly relevant in healthcare, where you might find a partner with whom you could scale and you think you gonna be a great thought partner, and you try different things and you have to be careful that you're not solving for that player in the market. And not for the market wri large. And as you're doing this, this is where I think the finance strategy ops all intersects is, are you clear in what your hypothesis is? Do you know what it is that you're expecting to see as a result? And if you're not seeing the results you expected, Are you, have you captured the information in, in the way, like this is where I think about data engineering, right? Particularly when you've got interaction with tons of healthcare data and the product and the end user. Can you interpret that data in a way that's gonna help you iterate to get to what, you know, Chris, you talked about earlier, product market fit. So you know, sometimes when I've come in early on where I've seen money spent, That, and I, you know, stop me if this is not the question that you're asking where I've said, you know, take one company where they, they had two subsidiaries, which is really typical in healthcare, right? Like, you have a pc. Mm-hmm. You have an ink, and they were operating in those two entities on different systems. And so some of it is just like, how do you. How do you spend less money in that example, like get both of these entities on the same system because it's gonna tell you enough, you're gonna save money, it's gonna tell you enough, and it's gonna, you're gonna be able to take money and redirect it towards the product. So there, there, I have definitely seen patterns where people spend a lot of money. Too soon. Really? Mm-hmm. And that's where the strategy comes in is are you directing your funding in a way that's gonna be testing your hypothesis?
Mike Gruen:Have you ever, speaking of too, too quickly, have you ever seen the opposite where companies are, maybe they're a little too, they're not willing to spend that money. They sort of are like, for whatever reason and are doing the opposite where they, they're not spending it fast enough or not sort of
Molly Hill Patten:sitting on it. Yeah, I've definitely seen that too. I mean, that's where it's like someone like you, Chris, that have done multiple startups. That's judgment. And this is why, you know, funders love to work with mm-hmm. People have started more than one company because that's where the judgment comes in, because you can also hit yourself by not spending enough.
Chris Duffus:Yeah. It's, it's definitely, um, a fine line. You know, uh, it's one of those things where it's like, what's a definition of, of, of insanity or something like that. Uh, you know, it can be viewed from, from multiple perspectives. Um, my strategy is I, I get in early, uh, and hang on for dear life. And, uh, you know, part of that is extending your runway as long as possible and treating every dollar like your last dollar. And that's where overspending, I mean, just the, that statement alone, it just says like, Ooh. Not efficiently spent this money, I overspent it. Right? That could be everything from like, oh, I'm gonna get like this huge office space because I wanna represent to the world that I have this huge office space. Or hiring a ton of people before you have things for them to do are revenue generating, you know, opportunities mm-hmm. For, for them. Um, or building a pr, uh, like this fully blown product. Before you actually know what users are gonna gravitate to. And you see this all, all the time. And so, you know what I, one of the things I'd say, especially in the, the tech and FinTech space is, you know, uh, uh, try to use someone else's existing product. You know, like rent it before you build it. Or rent to own or, you know, whatever that sort of analog is. Um, uh, but don't, don't commit to anything until you absolutely know that, okay, this is where I'm gonna generate revenue. Yeah. I wonder if that,
Molly Hill Patten:oh, just because this is a long time ago now, but, um, I worked for FlexCar and our main competitor was Zipcar. And we outsourced the tech to open and to reserve and open and close the cars. And that was an area where I actually thought we didn't spend enough. Mm. And who knew that that was, you know, this is all those, can you pivot fast enough? But Zipcar, ultimately we ended up merging with the car, the Zipcar, they developed their own tech and they really controlled the consumer experience in a way we did not. Because when we outsource that component of the technology, you know, the, that that vendor just didn't have the same drive to respond quickly as we did.
Mike Gruen:Right.
Molly Hill Patten:But you know, then in healthcare you outsource all sorts of things. And that was in transportation and health, us, those, all sorts of things. Because to your point, Chris is so highly regulated with hipaa. That until you reach a certain scale, there's some components of the data flow that it doesn't make sense for you to do
undefined:yourself
Chris Duffus:well. Yeah. But, but therein lies sort of the, uh, the quirks of it is that build and own what is strategic to you, and that's what you should be thoughtful about. And I would say that probably 90% of the time, most new tech companies, You know, overbuild their, their stack and where they should be partnering or licensing or, you know, repackaging someone else's platform at least initially until they get to a certain point. I would actually say in that example you gave Molly that these are sort of mature comp maturer company if issues, once you've gotten past a certain financing. Um, level and sustainability, um, where you're just talking about retention versus just, Hey, I'd like to get one customer, two customers, 10 or 110,000. Um,
Mike Gruen:yeah, I think the, the, what you said about, um, building for spying and all of that is another one where, like, if you, one of my theories, I haven't, I haven't worked at a ton, you know, I've worked at a few places, so I. My own experiences, um, about when companies re-platform, and I think there's companies that when they build too much too quickly, they sort of get bought in on it. And then they have this like sunk cost fallacy and they have a harder time sort of recognizing like it's ti like, yeah, that was fine, but like you should have probably left this like six months ago or nine months ago. But you keep on, you just keep investing in this platform that's, that's actually. Not the right platform and it's gonna fall crumble under the weight of what you're actually trying to do. And it only hamper, you know, you don't necessarily see it right away. It's something that you experience maybe a year later when you're realizing like, yeah, this is, we're spending so much time maintaining the system rather than building the things we need to build, uh, in that product market fit world. I'm curious if you guys would sort of agree with that, disagree with that. Say, I'm just totally off my mind. Uh, you know, totally off base on that, the.
Chris Duffus:Yeah, they call, they call it, uh, right? Mm-hmm.
Mike Gruen:Well, yes, I'm aware, yes. But the, the idea of not just tech debt, because tech debt I think is an important thing. Like tech debt is a valuable thing. It's like any debt. I wouldn't be able to afford my house if I didn't take out a mortgage. So there's a certain amount of debt that's appropriate, and then there's too much, and then there's what, you know, sort of waiting too long to deal with it. Um, I think is sort of where I was getting.
Chris Duffus:I, I, I think, I mean, yeah, it exists. It's a problem. Uh, and it, uh, I think it's more as much of a management issue as it is of just a, a pure technology issue and that you like, We're probably the external world wouldn't see this, but we're probably on the fourth or fifth generation of our product right now. We're like a mm-hmm. Two and a half year old company. Right. Um, and you know, part of that is like how we got started. Like, I'll give you a perfect example, like our first product, and this goes to like how we go to market fast, just to test out an idea, um, was. Uh, actually this wasn't even our first product. It was like our, our point, it was our 0.5 version versus one oh product, but was a Facebook Messenger bot that was e-commerce. Mm-hmm. Enabled. Um, you know, my current company, we, uh, have created this technology where we can, uh, uh, tokenize a unit of prepaid airtime credit on a public blockchain and essentially turn the value in. Um, uh, mobile phone sort of account into a stablecoin over the top of mobile carriers and banks. Well, um, we needed to test this at some micro level before we actually built something. Um, you know, and I, uh, set up a series of questions where we wanted to validate, um, our hypothesis. Like, would people even buy something like this? Or, or could we. Get someone to transact with us. There are many products where people spend millions of dollars and build something and then no one shows up. Right. Um, and so we just used some off the shelf software, uh, and, and the solution actually, I was at a conference and some guy was, CEO of this company, was showing me like, oh yeah, we have 11 million users that are using, you know, these messenger bots and we do all types of transactions on. I was like, oh. This is way better than building an app for a website. And so that was our first go to market. We ended up becoming the largest, uh, fastest growing sort of, um, reseller prepaid airtime, uh, within the, our designated sub-Saharan African countries within a few months. Uh, and that was sort of how it got started. It was like, You know, obvious, obviously we hit a bunch of limitations with that, but then that was sort of the impetus. Okay. Like, okay, now we know how to build it, what we build in an app. And the next version of that was a, a web app, which is still kind of available today, but we've now have a, a, you know, an Android app that's our core platform.
Tim Winkler:So this, this is at Phonebank, this is how you got your, kind of like your early stage product validation. Is that, is that. So, so I wanna like take back to the fir your first company. Um, you know, is that something that you learned along the way? You know, after making a couple of mistakes in the first go at this, like, how, what, what, what your, with your first startup, what was your approach to product validation and did, would you say you spent a lot more time and money and resources on that versus where you're at today?
Chris Duffus:Uh, definitely. Well, I'll give you the, the, the first sort of tech ish product that I ever created was, and this'll also date how old I am. Uh, when cell phone, cell phones first came out, um, they had, there were these feature phones and then these special bags that you had to create if you wanted a cell phone carrying case. And I was like, this is crazy. Like I got and I lost a phone one time and I got a different type of phone and you know, I had one of those like star tax and then I got a, a Nokia phone and one was a flip and it had it, it had special case and the other wasn't. I was like, there should be like a, a flexible bag that you could use to carry, to put each of your phones in so when if you drop it, you don't scratch and so forth. I figured out I, I designed this Nere bag and it's also a testament to the time and where we are today and how can go to market with something. But I was in New York City, I designed it and I went around the garment district and I found a couple, uh, uh, places that could, you know, create some samples for me. And then I went online and I. Some, somebody in California had a relationship with the manufacturer in China, and uh, I sent them designs. They sent me a sample back and I was like, all right, it's perfect. And I sent them money. And this probably took six to nine months. And then one day just out of the blue, like maybe another six months later, uh, maybe not that long, maybe like a quarter later. I, I got a box of like 5,000 of these neo preme, one size fits all cell phone cases. And um, and then from a sequencing standpoint, I'm like, okay, now I'm a product. And I went around to like cell phone stores to see if I could sell it. You know, this was back in the day when some of these guys were shady, at least the independent ones. And they'd take my product and they wouldn't give back to me. And, um, fast forward, you know, this wasn't my day job. Mm-hmm. It was sort of a side hustle. Uh, and I ended up getting, going to business school and, uh, I took all these bags with the, my, you know, my couch and some other TV or something like that. And I moved down. Uh, there. Uh, fast forward, I stored 'em in a box somewhere and, uh, or my closet somewhere and maybe tried to sell 'em every once in a while. And at, uh, graduated from business schools moving to DC and I'm going through that, that closet. It's like, man, it's been a couple years. I'm just gonna throw these things out. And I, I do that and I move to DC and like within a week I meet some. And he's like, oh yeah, I chain the cell phone stores. And I told him about the product. He's like, oh, I would've loved it. Just throw out. So yeah, the moral of the story, timing, timing is, is everything. Um, and you know, and with the technology, with, uh, the resources we have today, you can better align a lot of that sort of product market fit. More, more quickly. And I don't wanna sort of underemphasize that at, at all. Um, you know, I spent a lot of time thinking about sort of, you know, I start with sort of the end result and I sort of, uh, backward eyes that in terms of like, you know, what are the steps, what are the resources that I need to, to get there? And. Um, and there might not be a lot of action for a while. Like, I think about some of my new, my current businesses, like I even had the idea for this one, you know, maybe back in, um, uh, 2007, right? But there's a lot of things that from a market, product market standpoint weren't available, you know, uh, until today or in the last couple years. Uh, definitely blockchain. What invented, uh, you
Tim Winkler:know, So Molly, I, I have a question in terms of like, you know, with some of the consulting that you're doing with Zephyr, um, you know, when you're coming in, what, what is the, the stage or size of, of these companies that you're coming in and doing, you know, more of this finance and operations support early stage. You know, so is there a finance person in place or do you kind of come in as a, almost like a fractional C F O, um, you know, at that stage that you're coming in, is there already somebody that's, you know, really kind of managing the books and, you know, got a, a, a roadmap in place for spend? Or is that something they're asking you to help assemble?
Molly Hill Patten:There's generally a bookkeeper, so somebody who's been helping them keep track of spend. And they're just coming to realize that it's not their area of expertise, it's not a good use of their time. Mm-hmm. At the same time, the company's not so far along that they really should hire a full-time CFO or coo because again, you really wanna put your money towards your key value proposition. And operations is a lot about, like, you get the phone call when things aren't going right. So you really focus on operations when, to your point, Chris, like you have a lot of customers and so I, I am helping people think through, first of all, assessing like, where do you stand? How do you just put your finger right on the pulse of what's going on? And then thinking about what investments you do need to make an infras. Mm-hmm. I mean, I'll just say philosophically I am slow to hire, especially in a young company like it, it's tough when you have to let people go. Mm-hmm. And you, you, I mean, I don't mean this from a cash burn perspective, but you, you really do wanna feel the burden. So someone's, you know, bringing me in because they don't have the time. For what I call, you know, the cognitive labor to really think through. It's not a, it's not a question of if you're gonna need that function, if, when, and to what degree.
Tim Winkler:Mm-hmm. Yeah. We're seeing more and more so, you know, kind of on the idea of, you know, using some sort of. No-code, low-code type of drum up of a prototype. Um, you know, primarily an offshore outsource development team. Kind of, you know, drumming that up. But just until you're able to kind of validate something before you're going and hiring up. You know, that next couple of key senior engineers internally just because the, the cost of engineering talent is, is quite ridiculously high. Um, so you're outsourcing a good portion of that until you've been able to kind of validate, you know, that that product market fit. But um, yeah, Mike, I'm sure you've seen the same. And yeah,
Molly Hill Patten:I was just gonna say that the, one of the first questions I get is kick the tires on my runway.
Tim Winkler:Hmm. That's scary. It's something you
Molly Hill Patten:wanna check regularly, right? Yeah. Yeah. I don't, I don't think it's scary. I think it's, you know, when you do that, it actually, it's really empowering.
Tim Winkler:It's getting, getting a little bit more visibility, um, that they're not thinking about.
Molly Hill Patten:Yeah. I mean, it's just, they want that information right on their finger, right at their fingertips, but then they've got the information to make the decisions that matter. So they're not mm-hmm. They're not actually pulling the data together so much as saying like, here's the data. Yeah. Because this is, you know, I've been a controller, uh, you know, I, I've run accounting so I know what it is to like close the box and have to tie out to the penny. But at that stage, honestly, you don't really mean that. I mean, you do, don't get me wrong, but, but the person who's doing that is really functioning in the nitty gritty while I'm taking that information and translating
Tim Winkler:it. Sure. And, and at the end of
Chris Duffus:the day, uh, you know, just put in perspective, look at what happened with Silicon Valley Bank. There are a lot of companies that had their en entire, um, Working capital payroll, everything in their one account that they fully trusted. And Lilly, if that, um, if the d i c hadn't guaranteed the, the full amount of the funds, a lot of business would outta business with no hope of.
Molly Hill Patten:Yeah. Lemme tell you, thousand dollars does not. Like payroll,
Tim Winkler:right?
Mike Gruen:Yeah. Yeah.
Chris Duffus:And, and so and so, you know, as it comes to like burn your runway assumptions, like business, many businesses are very complicated, right? And there's a lot of different variables that go into calculating that type of assumption. You know, outside of just like, okay, these are my fixed expenses and this is my cash and you know, this, I can waterfall out. Like when that that ends, that's an easy one, but many businesses aren't. You know, that simple. And you could, you know, they're gonna be like, oh, you have an unexpected drop in sales one quarter again. Totally natural for a startup, right at, at very various stages. Company could, could be out of business or like,
Molly Hill Patten:a lot of it is based on, so you're, you're really early trying to figure out product market fit. You have a potential big customer that would say, Hey, if you can do X, like everybody's sitting in this boat, right? If you can do X, we can sign this deal. And then the question is, what impact does X have? And does this, is this gonna give me the return I need, and am I gonna just be able to pull the resources out of the hat to be able to do it?
Tim Winkler:Hmm.
Mike Gruen:And I think getting back to a point you made earlier, um, it's not just the dollars and cents of like, well, how much is it gonna cost me to build and what's the opportunity cost if I build that versus this and so and so forth. It's the, it probably goes back to the other thing that you brought up at very early on, Molly, about a good partner. Is this a good representation or good represent? You know, of what we want our product to be like I, I've worked at plenty of places where we've just chased the money, but it's sort of brought us down bad paths. It's like, cool, we built this thing and we landed big company X, but nobody else in this industry mm-hmm. Operates the way big Company X does. And so we've basically just. We sort of blew it. We, we spent a, you know, yeah, we're getting a return on that, but if we'd done something else, we probably would've gotten a larger return. Um, and I'm curious if that sort of ties into to some of the stuff that you're talking about as well. Oh yeah, totally.
Tim Winkler:Is there something that you,
Mike Gruen:sorry. No, no, please. I was just gonna ask like. Yeah. Well, I was gonna ask like what makes a good partner, but Tim, I don't know if, um, what you were
Tim Winkler:gonna ask. Well, I was just gonna relate it back to almost like, you know, it's also like the founder's vision, right? And so if the vision is just being skewed over to satisfy one customer's request, it's like, well, what was your, what is your overarching vision here? And is, is, are you still sticking to that or not? And I think that's where a lot of, a lot of companies might go down the wrong path of just trying to allure. Big customer and now their, their entire product's kind of, you know, getting shifted down in different directions.
Molly Hill Patten:It's so funny you say that, cause the first pairing I thought of was vision and capital. Mm-hmm. And that's good. You don't, you know, if you don't have your North Star, it's easy to your point, Mike, to just chase the money. And then your strategy is evolving cause you're chasing the money, not your strategy. Mm. And then you find yourself in a boat where you know, you haven't necessarily channeled the money the way it's going. You need to for it to pay off long term.
Tim Winkler:Mm-hmm. Right. So when you come in to, to help a company, you know, are you kind of starting from some of those grassroots of, you know, let's talk about the vision, let's talk about how those goals connect to, to, to your vision. And, and from there you can kind of figure out where the money is going and, and if it's in the right direction.
Molly Hill Patten:That is a great question because. I actually first try to figure out what their biggest pain point is. Mm-hmm. And fix that pain point. And then I'm asking those questions throughout the process as opposed to saying, Hey, at the outset can we talk about your strategy? It's more like, how do I get your stress level down? Mm-hmm. You know, cause, cause when you have scarcity of time and resources, literally the brain tunnels, right? Mm-hmm. And it's really hard to see big picture. So if you can take that friction out, if you can help them, like you can help reduce that feeling of scarcity, you're actually going to have a better conversation than if I'd asked it at the outset. Mm-hmm. Like, get there eventually put not straight out the gate.
Tim Winkler:Right. Put, put the, put any fires out first and foremost and re reduce the, uh, the stress level here. Yeah.
Chris Duffus:Yeah, Mo Mo Molly's like that, that character in, uh, pulp Fiction, the Wolf,
Mike Gruen:uh,
Chris Duffus:you, you see their faces when, uh, he shows up. They're like, but, uh, no. I mean, I, I think that's a great point. Like you spend a lot of. Uh, trying to adhere the organization to the vision and many, many people. Um, uh, ha That's one of the, the discipline that's really difficult to instill within a corporation. And, um, you need, you need. You know, it's a form of culture, being a culture bearers, but like, Hey, I'm a, I carry the water on the vision as well, and what you're doing today does not align with that vision. And so how do we sort of realign or readjust Yeah. And get course correct. Yeah, it's a good
Tim Winkler:point. I mean, it's, it's a topic that we could probably talk for another couple hours on in terms of like how that vision impacts everything from the culture of values and hiring and strategy. So, um, We'll have to, we'll have to put a plug in it for now. Um, but I think, you know, this is kind of just scratching the surface. Um, I'd love to, to transition us to this next segment here before, uh, before we wrap. So we'll, we'll, we'll segue into the, the five second scramble here. Again, this is gonna be, uh, Kind of a quick rapid fire q and a. Um, I'll ask a couple of business slash personal questions and try to give us, uh, your answers under five seconds. Um, so I will, I will start with, uh, with Chris. Um, Chris, what problems are you solving at phone bank, access to dollar? What, what type of technologist would you say thrives at phone?
Chris Duffus:Uh, someone who is nimble.
Tim Winkler:What's your favorite aspect of working at Phonebank? Uh,
Chris Duffus:international, like, uh, I am in a business where I like my customers. I like the problems we're solving. I like the markets we're going after. Um, and I think about sort of, this is something where I want to spend the rest of my life sort of
Tim Winkler:addressing. What do you love most about yourself?
Chris Duffus:Whoa. Uh, again, uh, we don't have another hour. I need extended time on this one.
Tim Winkler:Just, just, that's funny. Uh,
Chris Duffus:I, I like being who, uh, um, I like being a dad. I like being the version of myself
Tim Winkler:today. We'll simplify this next question. Favorite cereal? Uh, we need to extend the time again. Frost Flake, frost Flakes. All right. I, I dig that. Yeah. Um, what is a charity or corporate philanthropy that's near and dear to you?
Chris Duffus:The Garden School of Business. Um, uh, there you go. Greyhound Welfare. Bring it,
Tim Winkler:bring it full circle. Um, do you believe there's life on other planet?
Chris Duffus:Oh, heck yeah. That's something, something I think about every day. What's
Tim Winkler:the number one country you'd recommend that everyone should travel to once in their life? Hmm, Jamaica. All right. All right, Molly, you're up. We're gonna kick it off with, um, uh, question one. So with consulting, what is your favorite stage of a startup to jump in and help Series A? Sorry, because what is the, oh, go ahead. Yeah. As to why. Oh no, I was just gonna
Molly Hill Patten:say, because you're starting to figure out product market set.
Tim Winkler:Mm-hmm. What is the biggest challenge facing founders in 2023 Capital? What's, uh, what's one of the best personality traits that you've seen from successful founders? Resilience. What's your favorite aspect of call? The weeble wobble effect. The what? The Weeble wobble.
Molly Hill Patten:The weeble wobble effect. You know,
Mike Gruen:weeble Wobble. Wobble, but they don't fall, fall down Weebles. Right. For that.
Tim Winkler:Um, favorite aspect of, of working with Zephyr?
Molly Hill Patten:You know, I just love working with entrepreneurs. They're risk takers that see an opportunity and wanna make a difference.
Tim Winkler:Good answer. What is a charity, your corporate philanthropy that's near and dear to you? Okay, I'm gonna
Molly Hill Patten:have to name two. Okay. One is the News Literacy Project, and it's all about, you know, civics has been taken out of our high school. Curriculum and it's teaching kids and actually the public how to differentiate fact from fiction, and that is incredibly important this era. And the other is Rock Creek Conservancy because we just have a, a, just a wonderful asset here in the District of Columbia. I'm District of Columbia. It's a national park and it's absolutely beautiful and you know, got a lot of views through covid. So, uh, I work with a conservancy.
Tim Winkler:Cool. Including volume train to do Nice. What is your biggest guilty pleasure?
Molly Hill Patten:Sleep. So much more done. I didn't sleep.
Tim Winkler:Sleeping in. Um, if you had one day left to live, would you spend it with Morgan Freeman or Denzel Washington?
Molly Hill Patten:Wow. With my last date Morgan.
Tim Winkler:So you're going out, you're going out hardcore, huh? Little, little less casual than, than, uh, oh, I'm sorry. That's more Denzel. Sorry. Free. Yeah. You're you're, you're having a nice calm, a nice calm last day. Right.
Mike Gruen:Somebody narrating the story of your life. That's right.
Tim Winkler:Do you have, uh, do you have any phobias or, uh, irrational fears? Yeah, Roach. Oof. Would, would you rather have a pet dragon or a pet? Pet unicorn?
Molly Hill Patten:Um, I think a Pet
Tim Winkler:Dragon. Pet Dragon, because I would to fly's a good And your favorite Disney character to wrap it up, um,
Molly Hill Patten:is the last a girl Disney.
Tim Winkler:Everything's Disney these days. Isn't
Molly Hill Patten:Pixar part of Disney now? Yeah, I'm going with the last girl. I channel her all the time. I'm like, I can stretch that far.
Tim Winkler:Confirmed.
Molly Hill Patten:She is a good mom and she gets stuff done. She makes the world better
Tim Winkler:place. There you go. Well said. Cool. All right, well that is a wrap. Thank you all both for, for hanging out with us. Um, been fantastic guests and we're looking forward to, to sharing, uh, these insights with our listeners. Thank you. Thank you. Good guys both. Yep. Thanks so much.
Molly Hill Patten:Thank you for hosting.