EP #517: The tale of the tenacious entrepreneur – with Crew co-founder Mikael Cho

Mikael Cho is tenacious. Listening to this story it will become very clear that tenacity is the intangible skill in the entrepreneurs arsenal. It isn’t given. It isn’t learned. You have it or you don’t. The thing is, to be an entrepreneur you need it.

This is Mikael’s third visit to UNTETHER.tv – the first two were centered around the previous incarnation of his current business called OOOMPH. He is now the CEO of its evolution into Crew, a marketplace for matching highly qualified mobile development skills with projects. I say evolution on purpose because as you consume this episode you will notice a few things of importance: How an idea forms around a team and how the thinking of an entrepreneur evolves into a leader.

This isn’t just a story about switching businesses or pivoting, it is about fessing up to the questions all entrepreneurs face at one point in their lives: Is what I’m doing creating value? Tough question to ask but sometimes the answer is even tougher.

This is that story – Mikael’s story.


Key takeaways from this episode. Click on the link and the video will take you to that clip

1. What is Crew? 1:45
2. What was the cause of the transition from OOOMPH to Crew 3:35
3. When did you decide to transition? 5:45
4. How did you talk about the transition with your investors? 7:35
5. How did you know it was time to change the business? 10:00
6. What was the process to find the next business idea? 12:35
7. $125,000 in 7 days solidified Crew 16:20
8. What was the transition process from OOOMPH to Crew 19:00
9. What was the timeline for the transition? 23:00
10. How did you sign your first customers? 24:00
11. How has the Crew process changed since launch? 29:50
12. What did your investors think of the new direction? 35:20
13. What was the fundraising process like for Crew? 38:30
14. How a cold email landed their lead investor 41:00
15. The challenge of hitting metrics while raising a round 43:30
16. Post-investment feelings – what happens when it all goes right? 47:50
17. How different are you as a leader today as a result of this experience? 51:40
18. How do people start using Crew? 54:25


Raw Transcript

Rob: Hello everybody, and welcome to Untethered.tv. I’m your host and founder, Rob Woodbridge. This is that place you come to, to find the behind the scenes look at the mobile industry. Obviously, what I love more than anything, other than showcasing my city, and showcasing my country, which I get to do in this instance, as well, is bringing back a guest who was on a while ago, and for an 18 month check up. It’s around that time since this guest was on last, which would probably be late January of 2013. My guest is Mikael Cho, who is now the co- founder of a company called Crew, and he’s the CEO. Back then, he was the co-founder and the CEO of a company called Oomph. We did two episodes in January. We are going to find out what happened to Oomph, the transition from Oomph to Crew. We’re going to talk about the opportunity that Crew is tackling, which is really around the mobile app development space, about helping people actually build apps, but in a very unique way. And we’re going to get some tips, tricks on how to hire properly so that you can actually build a mobile application. A lot of people come to me and ask me that question, and I have no freaking idea. I just know what I’ve done before, but Mikael’s the guy to be able to at least point us in the direction. So, I’m going to bring him in right now, from Montreal, am I right Mikael, Montreal, Canada.

Mikael: Correct, Montreal, Canada.

Rob: Thanks for doing this. Third time around. The first two episodes, one was about Oomph, then we did an entire episode around the nine tips around building a mobile application. And now, all of a sudden, we’re doing this, and you’re not even Oomph anymore. Why don’t we start by talking about what Crew is, and we’re going to pull back and talk about what happened with Oomph.

Mikael: Sure, yeah. So, Crew is Oomph. I mean, it’s the same company.

Rob: What?!

Mikael: Except everything is different. Maybe 1% has stayed, a little bit of DNA. What Crew is, Crew is a network of independent, pre- vetted designers and developers focused on mobile. And we help connect them with pre-vetted projects. Let’s say if you wanted to build your first mobile application. We make it possible for you to work with somebody who has built 10 applications before, scaled to millions of users. People you don’t think you’d normally be able to get in touch with, we’re able to make that connection within 48 hours, typically. It’s a big change in the space, and we see the future of work moving towards every sort of business has some sort of online component and even more so, on mobile, and it’s this big change that’s happening in culture, and work, and it’s this thing that we’re lucky to be a part of at the same time.

Rob: When we talked last January, we talked about this revolution, this movement was happening back then, 18 months ago. It’s been going on for quite some time for those of us who have been in the industry for long enough. But, it always seemed like Oomph was really about educating. It was about pushing content out to people who wanted to initiate and do it themselves. Did you come to the realization that people are freaking lazy, and it’s more like, “No, no. I don’t want to receive information about how to do it, I just want to tell somebody how to do it.” That’s my assessment of this industry is that it’s tough, so I just want somebody to do it. What was the transition point for you guys, transitioning from Oomph to Crew?

Mikael: Yeah, I think there’s that balance of how much you want to do, and how much you want to learn, and what you want to be good at in your company or whatever you’re starting. But then there’s that part where it’s sort of like, “If I want to do this in the next year, there is no chance that if I try to learn everything, that this is ever going to happen.” We took it to the extent of, originally with Oomph, it was, we’ll help you market your application before it launches so it doesn’t disappear and die.

Rob: You’re on the other side of this.

Mikael: Correct.

Rob: The end. An app developed, we’re going to help you market it.

Mikael: Yeah. And we’re going to help you do it before it hits the shelves of the app store so that you have a fighting chance. When you get in, you have built up a following, people understand who the creator is, and what you’re trying to go after. It’s almost like a Kickstarter type model, but for apps. The challenge that we saw was, about 90-95% of the applications on Oomph, the quality wasn’t quite there. The marketing might be really good, but the quality of the product wasn’t there. Or in other instances, the quality of the development was strong, but the design wasn’t good. There was always sort of this component that was missing. That’s when we stepped back and were like, “Okay. Here’s how people are using this, and we actually need to go a step back towards the actual problem, which is building that better product first if we’re ever able to do anything else along the lines. Anything that has to do with pre-marketing — you can call it marketing, launching, any of that — you have to get the product right first. Otherwise, it’s like opening up a Christmas present that is crappy but is wrapped really nicely. Eventually, you know, “Okay, it was really nice wrapping paper but it’s not a good gift.” That’s sort of the same philosophy. You need to step back and build a better product before you ever hope to serve the market.

Rob: We can talk about this in hindsight, but when we were speaking last January, what was going on at that point with Oomph? Did you see the writing on the wall at that moment, when you were thinking of transitioning when we were talking?

Mikael: We were sorting out what Oomph was at that point. We had some tools, we had some education tips built in to help you launch your application, a couple marketing things to help you get on the map before you got in the app store. We had done some of those things and it was just figuring out, “What is going to be the thing?” We have a lot of these little things.

Rob: You were all over the place.

Mikael: Yeah. We were putting out feelers for which one is going to be the thing. We had about 20,000 app makers sign up in three or four months. They were sort of lukewarmly using things. Just touching in, there were none that were a home run. You realize, “What we’re really building right now isn’t the thing. There’s something else that needs to be the thing.” That’s when we had a meeting with our lead investor. He was like, “I don’t know what you guys are doing.”

Rob: That’s what he was saying to you?

Mikael: Yeah. We had six months left of cash in the bank. You get out of a meeting like that and you’re like, “We’re done. I don’t know what we’re going to do. If we keep going down this route, do we just go down a rabbit hole of impending doom? Even if we make this thing better, how many people are actually going to use it? Is it even going to be useful?” It happened almost right after our phone call. I think three weeks after. It was just, “What are we going to do?”

Rob: Talk about that meeting. Was it the investor that called you guys in? Was it just an update and he just laid this on you?

Mikael: We called our investor in. We wanted to give him an update because we were feeling the crossroads, because we hadn’t built-; “if we were going to go this route, here’s what it would look like.” And we wanted to show our investor, we wanted to show ourselves how we could weave this together and what this would be. We realized in speaking in that meeting with our investor that we didn’t know. Our investor said something that was sort of like, “It sounds like you’re hoping. You don’t know anymore. You seem like a different team. It sounds like you’re hoping and you’re not knowing.” That is really scary. Someone says, “You’re not the same team anymore,” and questions everything that you’re doing.

Rob: Was he right?

Mikael: In a sense. It forces you to think. It’s not necessarily to believe it right away and that’s exactly what you are and that’s what it is. It forces you to think deep inside of yourself. “Is this really a thing?” If I stepped away for a month and came back and saw this product and somebody else was building it, would I see the value in it that I see right now because I’m in the middle of it? It forced to all pull back and say, “Is this a product? Is this a company? Is this a gimmick? What is it?” In that sense, it was really helpful. We ultimately made the decision to make the change. It was really scary and we didn’t communicate it the best. I didn’t communicate the best with our investor because I took it as a challenge. After that meeting, it was sort of like, “What are you going to do now? I’m almost giving up on you.” So, I “forgot” to tell him. We just kind of moved forward and wanted to prove things before I had to go back and show him what we were doing. That’s where we were shifting to the early versions of Crew, and I showed the progress about a month after that. Things were changing then. It was a really interesting transition, very scary.

Rob: So when you leave that meeting, there has to be something in body language or tone or the story that you’re retelling over and over again to your investor, right? It’s the same story.

Mikael: Yeah.

Rob: And you’re not progressing. Like did you sense that, as like a C.E.O.? You’re looking over thinking . . . It sounds like you had those doubts. Is this a product? Is this a gimmick? Is this a service? Is this something? Is this a business? Are we just hanging? Did you sense that and was it crystallized by your investor, or when you left that meeting it kind of dawned on you that maybe it’s my body language or demeanor. Maybe I’m not as confident any more in this idea.

Mikael: Yeah, I think that’s a really interesting point, and it . . . There’s more factors too than just what you’re saying. I noticed that a lot. You give pitches a lot as a founder and it’s all those other things that are happening with your body and your eyes. And those things are way more important almost than anything that you’re saying and when we worked with founder feel like you’re pitching every day. You have that same issue if you don’t believe in your pitch even just for that day. They can sense it, and then they’ll evaluate it as a poor pitch when really the content, the way you were saying was exactly the same almost day to day. It’s just how you said it was so different, and there’s something internally there that you can’t hide.

Rob: You cannot hide it. No.

Mikael: And when there’s a doubt it can be sensed and experienced somewhat in an investor. Even a customer or a partner can sense that uncertainty.

Rob: Yeah. That’s amazing though. I’m fascinated by this because it . . . You know, I wrote about you when we spoke the first time about this, the tenacity of an entrepreneur, the ability to change ideas and to troll that change but not be too, I don’t know, not be too concerned or too attached, I think is the best word. Attached to an idea that you are in the middle of trying to explore, right? And I think that “Oh, I’m fried.” When you guys came out of that meeting or it was something that happened, maybe it was a trigger, maybe it was before, you kind of walked out kind of oomph. And you thought, “Man, he just articulated what we’ve all been feeling here.” And now it’s time to do what we do best as entrepreneurs and refocus and reshift. And we’ve got six months to turn things around, and that’s where you guys hit after that meeting, am I right?

Mikael: Right. Yes.

Rob: So what happened next?

Mikael: When you have six months left of money . . .

Rob: Some people don’t have any money, right?

Mikael: Yeah. You’re kind of like, we have the checks. There’s something we can do, and if there was anything we could do, what would we do? Because the chances are likely low that no matter what we do we have six months. So what are we going to able to do? So we might as well build something that you want to do and that you could see yourself doing forever and never got another dime.

Rob: Yep.

Mikael: So we actually wrote down all these random names of companies, like YouTube, Shopify, and all these big companies. And then we put nouns on the other cards, and we started pairing things. And we were like, what random things . . . Maybe the idea’s not going to come from that. Can it trigger something else? Can it just move you to another place where you’re finding something?

Rob: So let me get this right before we go . . . So you’ve got like companies you admire or would have wanted to create or things that you look at as the bastions in industry. And then you put nouns to describe whatever, like it could be shopping.

Mikael: Yeah, exactly.

Rob: You put words next to it, and all you’re trying to do is associate; you’re throwing those together to figure out what ideas to spur from that.

Mikael: Right, exactly. So it might be design, YouTube for design. What does that look like or it’s Shopify for weddings. What does that look like? Random stuff, you know, it’s things that maybe never ever were built, but it helps to create different connections in your head and move things around; because at that point you’re starting from scratch essentially.

Rob: It sounds like you were. You’d put oomph on the shelf here, and it’s like, okay, forget that, forget everything. And now basically the floor is open for anything.

Mikael: Right. What would happen?” And it was really . . . We were almost willing to just do whatever would happen. We were like, all four of us. We were four founders, and we said, “All of us have to agree. That’s the only thing, the only requirement.” For the next six months or whatever it is for however long, we’re going to be together. We all agree we still want the same thing. That’s the only requirement.

Rob: That’s it. And it could’ve been shining floors, it could’ve been doing windows. It didn’t have to be intact. It just could’ve been anything.

Mikael: Yes.

Rob: As long as you all agreed.

Mikael: So what we did actually was, we took two weeks and we said, “Everybody, build what you want to build.” So we had each person essentially taking on a project. And then after two weeks, let’s see, let’s show each other what we were doing, and see how we feel about these things. And if you haven’t built anything, that’s okay, too. Maybe you didn’t feel anything. But that’s the way we were sort of approaching it. Anything goes. We knew that it was a big shift, and we were feeling like it could come to an end. And anything could happen, you know? So why not just do whatever. Do the thing that is burning inside of you to do.

Rob: So you guys go off, and you do this.

Mikael: Yes.

Rob: So all four of you go off and work on an idea for two weeks.

Mikael: Yes.

Rob: And then you kind of have your own little FounderFuel presentation where you stood up and were critiqued or were praised based on it?

Mikael: Yes.

Rob: So you guys all went off and then came back, and whose idea was Crew?

Mikael: We had built a little section on Oomph, right before we made this change of professionals to sort of help me connect, because we saw the problems. We had people good at marketing and people good at designing or developing. So we wanted to start making those connections. We built a landing page essentially before we made this change. But it came back to me and Seth, and my co-founders, and we told our other two co-founders that we see there’s something here. I used to be an independent designer. I also used to work at an agency. So I knew the issues that existed in the space. Plus we had knowledge from Oomph. And we were still passionate about helping people who want to move into this space. There is an element of Oomph that included that, and that’s what attracted us to it. How could we help the next generation, sort of, of entrepreneurs who are going to be building products most likely on mobile or some elements of mobile or web. And how can we help that? So we wanted to continue with that, and that was sort of our project.
I can’t code, and neither can Seth. So we sort of used that landing page, along with a whole bunch of other hacks to do our product. And after a week, we had $125,000 worth of projects that we had submitted. And it was crazy. So when we showed this to our team, they knew that we didn’t have any design or developments, and essentially, building them from scratch. We were using all these hacked together ways to make it happen, and it was a real sort of telltale sign. Like, “Wow, you guys were able to do this.” And then we were able to present it properly. Like here’s where we’re going. Here’s where it is now. And the team sort of started to rally around this concept. People started throwing around ideas. The way we did it is we had two weeks almost away from each other. We all went in different…like, two were working at home in different spots. And we did a retreat in the Bahamas.

Rob: In the Bahamas?

Mikael: Yes.

Rob: So if you were going to go out, like in six months, you might as well just go to the Bahamas.

Mikael: We removed everything, and we were like, “We’re going to go here, and we’re going to incubate here for two weeks. And on day one we’re all going to come and present this idea. And then we’re going to choose. And the next two weeks we’re going to build the first version of that idea.”

Rob: Come on. So you basically hunkered down?

Mikael: Yes. It was a bunker. I mean, Bahamas was nice, but it was like one of the most productive weeks in our company’s life.

Rob: I love that story. So you came out of the Bahamas…

Mikael: Yes.

Rob:…with version 1, beta 1 of Crew?

Mikael: We had version 1 of it. It was called, “Oomph.” But yes.

Rob: Yes.

Mikael: The same concept that we have now exactly.

Rob: So you brought that home with you.

Mikael: Right.

Rob: Basically you tucked that in your laptop, put it under your arm, got on the plane, came back up to Montreal in the middle of winter, right?

Mikael: Yes.

Rob: And then what did you guys do from there? You’re still as “Oomph” at that moment, right?

Mikael: Right.

Rob: And then what’s the next stage? You don’t like the name?

Mikael: You know, we have five months, right?

Rob: The clock is ticking.

Mikael: Anything that didn’t have to do with your key metrics that will help you raise another round didn’t matter. Everything faded sort of to the background.

Rob: What were your metrics then?

Mikael: So for us it was a number of projects. How can we help get those through and how can we help them complete?

Rob: Right

Mikael: So that’s a very challenging thing, you know? You can get. . . There are a lot of professional platforms, platforms for professionals to help connect. But, how do you ensure that that connection is a good one and that they’re able to work together? And the business model for a marketplace in order to sustain is you essentially have to have a percentage built in. So, you have to provide value beyond the initial connection in order for people to see value in what you offer. So, it’s one of the most challenging things you can do in a few months, let alone a year to build. It’s essentially two businesses. You have two types of customers and you have to build a network that supports the connection so that they not only connect and work together, but they’re complete and they’re happy. So, that was all we were focused on, that. How do we make a connection happen? How do we make it go through so everyone is happy because that is going to be the sustainable business model that keeps alive long-term?

Rob: Oh, it’s just that simple, right? You know, and I say that. . . It’s a total joke because if you’ve ever built anything software related or if you’ve built a house or a deck or anything that involves outside contractors or employees or yourself, for example, you know that 90% of these projects never finish on time and a huge percentage just never finish at all. They’re just never complete. So for you guys to take on, and especially in the mobile space where you’ve got. . . I mean just put a recent episode on Tethered.TV. We talked about the state of mobile. I believe wholeheartedly we haven’t figured out the web yet as a business entity in Canada, in the United States, or in the world. I think we’re maybe three-quarters of the way there to understand the implication of the web.

Mikael: Yeah.

Rob: We’re like less than 1% there on the way of understanding what mobile means to your business. And then when we talk about the internet of things and connected and [inaudible 00:022:16], nobody gets that right [inaudible 00:02:20]. So, you’re taking something like mobile which is a black art to a lot of people and then you’re talking about. . . And then you’re combining with the ability to get projects done, match them with the right people, and deliver on-time. That is like a witch’s brew of stuff.

Mikael: It’s. . . Yeah.

Rob: That is next to impossible to possibly achieve.

Mikael: Right.

Rob: And you said well this has got to be easier than Oomph.

Mikael: [laughs]

Rob: What are you, crazy man? Are you crazy?

Mikael: For us it was. . . I mean it was empowering to see the connections happen. I mean when you connect two people and they start working together.

Rob: It’s amazing

Mikael: It’s nothing you can feel like. . . It doesn’t feel like software. It feels like you’ve created a real. . . There’s a relationship. There’s an exchange of value. It’s an insane feeling and we’ve connected almost a thousand projects now. It’s an unreal thing.

Rob: That’s great. When did all of this go down? So, put this on a timeline here because we talked at the end of January of 2013. You guys had the meeting maybe three weeks later. So, are we talking about you guys kind of emerging as this new version of Oomph like in May, June, kind of timeframe?

Mikael: It was almost about April, its version.

Rob: April?

Mikael: Yeah.

Rob: Ok. April 2013.

Mikael: So, almost a year ago, about a year ago. Yeah it was just from their when everything went so fast. I mean, we were just watching those numbers making sure that those connections were happening so that we could keep the company alive. So, that we could make more of those connections happen and have a future. I mean, we didn’t know for sure what was going to happen, but that’s what we were looking at. Anything that would help those numbers or help those things happen, that’s what we were really focused on for those next few months.

Rob: So how did you get your first customers? Now, I mean that not because you have a network of developers, but you’ve got to also have this level of trust.

Mikael: Yeah.

Rob: With not only the people that are paying for the app to be developed, but also the developers themselves and you can’t be looked at as a middle man of no value, so how did you get your first customers?

Mikael: Right.

Rob: How did you convince somebody?

Mikael: So, remember the first list. We actually went through twitter and we found. . . It wasn’t on Tether, but like a Tether sort of twitter channel where there’d be a lot of mole people.

Rob: yeah.

Mikael: We would actually go through to their sites, validate their portfolios manually. This was all done manually in a massive Google Doc. We knew, sort of, a rough number that we needed in order to fulfill the number of projects. So, we would write to those professionals and the ones that sort of had the work that met our standards and say we have this vetted systems for getting good projects coming through, here’s the average price, and we’re just going to put you on a mailing list. If you want to unsubscribe, if you don’t like the projects, you could just unsubscribe. So, there’s almost no –

Rob: Nobody’s to turn down work.

Mikael: Right, exactly. And it was interesting because we found out it was easier to get professionals, than it was to get projects. Originally, we thought in the space, supply and demand, you see it’s very difficult to get good developers so there’s a high demand for that. So, we thought it would be the other way around. But when it came to getting enough projects for the members that was a whole other challenge that we never expected because the budgeting, the scoping, finding, the right people in a company who would do that, the founders, how do you reach those people. And lots of experimentation of the next few months to do that and you’ve seen some of the things that we’ve built to bring that side into

Rob: So, you went after the developers first, thinking that that’s where the scarcity lies, but it’s really in the projects. So, you were almost doing business development for the developers that you had signed on that agreed to be a part of this. You were out there hustling on their behalf.

Mikael: Yeah, so we were doing one week turn-arounds. So, when we first started, we would send projects on Saturdays only, so that would give us the full week.

Rob: To go find projects?

Mikael: Yeah. So, we would say, “Saturday, okay, here’s the projects and we saw how many introductions came through, which number were active. And then that Sunday, it was, “Okay, no projects for sure,” And then, “Do we need more memos?”

Rob: How many projects were you looking for, to collect?

Mikael: So, that first week we did $125,000 submitted projects. Now our vetting standards and things, that we make sure that projects are – and some of those didn’t go through. We didn’t know exactly. But, that was a good amount, a good start, and that was the metric that we were looking at, How can we improve on this and make sure there’s enough projects for the number of member, so you’re starting right away. Supply and demand dynamics is very complex stuff. And some people aren’t, available, some are, some are just checking it out, some want to be very active. So, it’s starting right away in the marketplace, what’s interesting is that dynamic is almost the most important thing. So, if you look at something like Uber 2. That is there whole thing if there’s too many drivers, or there’s too many people requesting rides, it doesn’t matter how pretty the rest of the app is or anything. If that piece falls apart, the whole system breaks. So, it’s interesting when you start on Marketplace, you think of all the things that you’re going to need. We need payments, we need protection, transferred funds, but it’s really that supply and demand at hand. And if you spend the most time at that – this is an interesting thing we learned – you’re almost doing that from scratch if you start there. You’re starting on that. Whatever that supply and demand thing is for you in a marketplace business, that’s where you need to focus.

Rob: And then the rest falls into place.

Rob: Yeah, you just have to start doing things. It’s like, “Hey, I want to send money. I want to send $500,000 to the UK.” Okay, I don’t know how we’re going to do it.

Mikael: You can do it tomorrow, and then you spend the night trying to figure out how to do that. I want my code, I want code protection until I get paid. So, you have to hold on to the code. So, you go after the developers, you get them on board, you get them excited and then you guys are out there hustling trying to prime the pump so that you get some successful projects through. And then I guess the hope is people go to the crew website and submit projects on their own and that’s where the majority of the projects come from. Is that the hope?

Mikael: Right.

Rob: Is that’s what’s happening now?

Mikael: Right, so the goal was eventually you have to build up both sides enough and eventually, you have enough projects coming through where it supports the whole system. Now a year later, we have a very strong flow of projects that are coming through, and that’s great for an independent professional, who typically in his career typically, sees lulls like this. You’ll have big months where you have lots of projects and then other months where it really dips, and you’re fighting for the next gig. So, with us you’re tapping into the stream of consistent quality work. And for someone submitting a project, you’re tapping into this network of pre-vetted people who you would not be able to connect with usually. So, there’s a value on both sides to the network and that’s the most challenging part, but it’s where we started.

Rob: And how have your standards changed in the year? so not only from the project level, the type of project that you’re going after now. or that you will accept. And also the type of developer, right, maybe a year ago it was kind of come one, come all. Any project come in and a year later you’ve narrowed it down. How have you gone through that vetting process?

Mikael: Yeah. At the beginning it was come one, come all. So any designer, developer projects you just make that they’re meeting sort of an hourly 50 dollar minimum and the average budget was about four thousand dollars. We just make the connections. We actually make the connections through Gmail accounts. So we would make, each project had its own Gmail account. So it would be like [email protected], project two. There was a [email protected], [email protected]

Rob: So it scaled really easily, you’re saying. Oh my God.

Mikael: So we knew that we had six projects so on that Saturday when we would do the introductions we would send them all through sort of Gmail like that. That would allow us to track. It was an interesting sort of way that we were doing things. But yeah, we started with that and then we moved through doing payments through wufoo and stripe. They had an integration and you could do like five transactions for free. So we would run transactions through those. It was like a form with an email and put in your credit card.

Rob: Wow.

Mikael: That’s how we were running…

Rob: People were doing that?

Mikael: People were putting five thousand dollar milestone payments through that system. We had a stripe account set up so we could protect the funds, but it was very interesting to see that this is such a need that people would run a project through this because it was just I need this now.

Rob: They would blindly trust you guys. That’s what it was.

Mikael: There was a lot of trust and it was a telling sign for us. If we make this even just a little bit better, there’s a big chance that this could really work.

Rob: So then as you guys go through this process, the developers they become smarter. So do you drop people that…your goal, it’s like an open list if you’re a marketer. If your goal is to get the highest open rate you can and you can do it one of two ways. You can create absolutely amazing content that tailored expressly for those people on mailing lists or drop the people who don’t open them. Right? And then your open rate goes up. So when you guys are looking at the success rate of your early projects you must be grading developers. And those that are being successful and those that are not and then you just kind of slowly push those guys out the back door and bring in some new guys. How was your process for weeding them out?

Mikael: At the beginning it was almost self selecting. It was sort of you would see certain developers would rise to the top almost every time. And they became noted inside of our systems. So if we had a project that was coming in looking for someone very specific. Let’s say I needed IOS developer in New York who needs to be there we would know instantly. And we would keep the network very tight so there was a lot of loyalty. We actually had a lot of our members still on Skype. So we had this massive sort of messaging thread with each of them. So when a project comes through it seems like it automatic and very, very fast. It is very fast but there’s still sort of this little ping that we’re sending a lot of times to a professional that we know is a good fit for this project. We don’t necessarily need to show a developer who’s in Denver who’s not going to fit with that. Why flood his inbox? So before we can build, yes we want to build a system where it’s very specific that links specific people with specific projects automatically, but we can’t do that yet. We’re still very new. So we do a lot of these things that are still a little of that manual component that’s there. But I think just getting over the fact early on. We learned from the beginning just building things like with no code almost. The first version of crew, you can still do a lot of those things. You would be surprised how long you can do that and how well they scale before you actually need to build technology.

Rob: I believe in this. Like the 37 signals of philosophy around, don’t build something that you think you’re going to hit in a year or two. Build to scale and almost fail.

Mikael: Right.

Rob: And then keep adding. Then build more. Build for what you need now, not what you’ll need in two years.

Mikael: Right.

Rob: That’s something that I preach all the time, but you guys are living this and there’s an amazing amount of tools out there that can actually allow you to do those very, very, very quickly. I think that part of that is the challenge in the mobile space. Is that people thought they could build great mobile experiences. Like awesome mobile experiences with third party tools. You know you can get it to a certain level, but you can’t get it to that real embedded use every day, custom designed native application You know, build once and deployed everywhere sometimes just doesn’t work. And I think that the rush to those tools, you are starting to see the backlash. A lot of those guys that went to those tools are now looking for developers who can build natively. And I think that it bodes well for you guys. So, you guys are on your way here. When did you change the name? When did you, kind of, give up on Oomph and put it to Crew?

Mikael: That was about a month after we raised the last funding round.

Rob: Okay, wait, so you took this whole concept, you built it out. You went to Barbados. You came back. You started driving revenue through this. You are bringing on developers. You’re hustling on their behalf. You are finding clients for them, projects for them. And then you tell your investor, your primary investor, the guy that scolded you a couple of months before. You tell that guy and then what does he say about what you are doing now?

Mikael: So, we sent a message to all of the customers, saying that we are changing that. And our investor is on that list.

Rob: Oh great! So, you got another guy. Dear Investor. Dear Whoever.

Mikael: Yeah, so, I remember doing that. And I didn’t navigate this properly. This is actually my first company so I was looking at it at the approach of wanting to prove something before going back and speaking with them again. And he is very understanding. He was just, sort of, you know, just make sure if anything happens like this, just tell me before. It’s an important thing and I understand. Changing the business, changing the model, is an important thing to tell your investor. So, yeah, moving forward, I showed him the traction. I showed him what we had built in such a short period of time and where we were heading with it. Yeah, there were still a lot of things to work on but I think putting the traction behind it and seeing, now, the body language, and the eyes, and the team, you know, where this is the thing. And they are going in on this and there is a reason they are going in on this. There is some intuition there, some backing, some traction. I think that really resonated through the whole team. And then you could feel that as you were moving forward, raising the next round, talking with investors. Because we had to step back, you know, way back when, and change Oomph and go back into your heart and figure out if you can get another dime. That almost helps you get another dime. And that is an interesting thing, how that works. And you see it through all sorts of things whether it’s dating or whatever it is. You are trying not to get the girl. The girl likes you.

Rob: That never happens to me.

Mikael: That’s interesting.

Rob: Never happened. I never played that cool. But, so, he is OK with it, right? Ultimately, he is OK with it? Because had Oomph ever seen this kind of traction, $125,000 in the first couple of weeks, that kind of stuff?

Mikael: We didn’t know what the right type of metrics were yet, even with Oomph. I mean, we had a large number of people in the market that were interested in what we were doing. But it was always, “What are you doing exactly”? You know. “I know there is something over there but I don’t know.” It’s like the clap, its over there. But I don’t really know exactly what is there.

Rob: It’s up there man. Trust me. It’s there somewhere. I mean, I have these conversations daily about unteather.tv. There is something here. Right? Like those are the things. So I am learning from you as well. Like, really? I have to go and do something else. Is that what you are saying? So, then you raise more money. Like very quickly. So you talk to you investor. He is OK with it. You’re moving forward. You’re getting traction. You are starting to drive some good numbers through. Your metrics are going up, your key metrics, which is what you should be focusing on. If there is one thing you get out of this entire episode is that you have to know what your metric is and follow that metric. And you have to understand what it means when you achieve your goals in that metric. So, you are getting all of these things and then you go out for more money.

Mikael: Right.

Rob: So, tell me about that experience. Was it easy, hard? Were people welcoming? Was it the original investor? What happened, did you raise?

Mikael: It was scary because the first raise we did was straight out of [Fonderfield]. And that is a different environment. You know, you have a demo day and then you’ve sort of got the investors that are there. And, the investors who are running the fund, which will ventures, so, if they are interested in the investment, that’s what happened in our case. Our fundraising period for that was actually very short and very different than a typical fundraising process, so, this was almost like our first actual fundraising. And I remember, I was like, we are going to have to do this again. Like, oh man, and this one is like the real one. You know. We are going to have to go, you have to go to New York, Boston, San Francisco, and you just sort of keep looping that until you get the money that you need to run your company and I just sort of Mikael: …And I just sort of, you know, we did almost as we always did at the beginning of anything. You know, when you’re trying to figure it out yourself, and you’re reading about what other people have done, you’re trying to take your own spin on it, how can, how can we sort of hack the system to do it faster, or better, than what we’re even reading? And that was sort of the approach, and that’s what we’ve taken even with the company. How can we do it better, how can you go a step further than even the good stuff that you’re reading right now?

Rob: Yeah.

Mikael: You know, because you can’t replicate exactly what you’re reading, I mean that’s, that advice, even if it’s a month, or two weeks, it’s almost old. You know, it’s like who knows if it’s going to work? Take you’re…

Rob: Out of context, yeah. It has nothing to do with you, right?

Mikael: Right, so take those things bring them in, it’s okay to look at them, but then make your path, and do an action, right? And that’s what it was. You know, we first started, we actually drove from Montreal to Boston, I remember that, and we would have…I didn’t have any meetings set up I would just meet with the couple people I randomly called, emailed. You know, there’s a couple founders who were there, and I’m like I’m not….I’m new to Boston, you know, and I don’t know…I know there’s investors here, and a there’s good community here, and we’re looking to raise our next round, which is sort of speaking about the business, and I was lucky enough to…I wrote to actually the founders of Custom Made was one of my first emails, and their marketplace for makers. So, people who if you want like a lamp with legs on it, you know, and you want it custom, you know, they help with that, and they raise a lot of funding, they have great investors, but I was just always interested in their model, and their marketplace, very similar concept to Cruise. So, I just wanted to meet the founder, and he was nice enough, we took a walk around, and he just sort of said you know, “Send me the deck this weekend, and if it’s something, you know, if it seems like you’re on to something I can give you some feedback. Then I’d be happy to potentially introduce you to some investors.”

Rob: Wow.

Mikael: And that was huge, because we were going to leave that day, and I’m like, “Okay, we’re staying for a whole another week, and we need to see what happens,” right? So, I sent the deck over, he even offered us to like work out of his space. So, that was huge, and that was a big moment. We actually, our lead investor is their lead investor, so that introduction happened from him, so very, very grateful for the help.

Rob: And that was a cold email?

Mikael: Cold email, and I think it was, I mean I knew that this was the marketplace they were building, and the similarities, and we would believe in the same things, and that was actually reason why I wrote. You know, I had no intention of you know thinking that he would intro his investors, because that is a very close introduction, very important thing, you know to keep tight, and you don’t give that introduction to just anybody.

Rob: You certainly don’t random guys that email you from Canada, right?

Mikael: So, and yeah that was a great thing, and we ended up meeting with our now lead investor right after that week and signed to the [inaudible] a couple weeks later.

Rob: So, it was still a relatively short cycle for you guys to raise?

Mikael: Yeah, because Boston was really, really good for us. I mean, a lot of the investors were, were really great there, didn’t expect sort of the warm welcome coming from Canada. You know, it’s a why are you in Montreal, and why are you…you know? So, yeah, and then getting the lead right away I think helped move things forward a lot quicker for us.

Rob: What did you raise? How much did you guys end up raising?

Mikael: We did $2.1 million.

Rob: Yeah.

Mikael: We set out just initially to raise a million, we didn’t think we had the metric’s yet, but interestingly the longer it took us to close the round, because we did get interest from that lead investor pretty quickly.

Rob: Yeah.

Mikael: We didn’t close the round until December 24, right before… So, as the round kept going, you know typically that’s a scary thing for a company, because you’re metric’s usually take a hit. Right so, investors it’s in their interests then just to wait and see. You know, is this number, is this real? You know, is it going to go down, what’s going to happen? So, as we were fundraising we knew that we needed to keep that number up, and the number we were targeting was 30 percent month-over-month growth. So, we were able to hit that even while we were fundraising.

Rob: Did you set that number, or did they?

Mikael: We set that number.

Rob: Okay.

Mikael: So, Paul Graham wrote a really good piece about like what is growth, you know what is that number, and he sort of mentioned in there that every company, and why [inaudible] is sort of targeting this ten percent week-over-week, and if you don’t know…You know, if you’re not hitting that then you don’t know something, right? So, and that was an interesting take, and sort of the first time I heard of an actual number that you could shoot for. We said, “Whatever we have to do to hit that number we have to do it, and we have to figure out a way.” So, every month it’s really scary, you know. Especially a month where you grow really big, you start over the next…

Rob: Yeah.

Mikael: The first of that month, and you’re like “OK, how are we going to beat that?” You know, we still have to do everything that we did the previous time, but now we have to do another thing.

Rob: How are you doing that, then? Like, so, you know, I’ve done the fund raising routine, right? Across the country, back and forth, and especially in Canada. I mean, there’s not a lot of money in Canada, so you definitely have to go…you can get some seed money here, if you know some good angel investors, and there’s a lot of wealth up here. It just doesn’t…it’s just not as easily accessible. There’s not these pockets, where you go to Boston and New York, and you go to San Francisco…it’s like money falls out of peoples’ pockets. Up here, it’s not the same thing, ’cause it’s…we’re in a frozen tundra eight months of the year. People don’t walk around with loose change. But I’ve done that. And, you know, there’s a point in time, and I always think that, you know, you can choose to go after money, or you can choose to go after customers. And, at some point, they’re so far apart, where you can’t decide, when you go after money, you can’t decide to shift focus back to customers, because you’re so far away. You’ve left that. You’ve let that go, in lieu of going after investment. And all of a sudden, you realize that your business is failing, because you’ve gone so far after investment. How did you keep those in line with each other, while you were still in this kind of tenuous spot: needing the money to come in, revenue to come in, and still going after investment, while still holding onto that growth rate that you wanted to achieve?

Mikael: Right. So there were two big things that we did. One was setting a date, so we knew that it would end. So we said, “We’re fund- raising, and ending on this day.” Which we did extend a little bit, but getting the lead, you knew that there was something was going to happen. You were going to close something. You know, if we had this investor, who was a strong investor, has to be.

And the second piece was prepping your team. So, something has to give. You know, we’re not going to be able to push product out as fast, because we actually need our designer, for example, to help with some of the support. So we sort of prepared, as a team, that this was going to happen. For the next three months, you know: “Here’s the deadline, here’s the end date that we’re going to finish on, fund-raising. But we’re going to have to restructure stuff. So I can’t be helping with customers as much, but we’re still going to need to provide that element, plus we’re growing. So there’s going to be a lot. There’s going to be a lot on everyone’s plate, but it’s going to last this long.”

All right, so putting almost a defined end date, I think is always helpful, because you know it’s going to end. Whereas if you don’t have an end date, the team also feels like “Is this ever going to happen? Am I just going to be doing this until the company doesn’t get funding, and we end?”. You know, so I think those two main things were really helpful for us, as a team.

Rob: What a story, man. It’s so interesting, to watch this transition. Because, obviously you know there’s a level of persistence that you need to have, as an entrepreneur. And this is the exact reason, right? And there’s also that side of realism, when you’re looking at your business, that you have to say, “Is this a business?”, like you guys did. “Can we make money? Can we not make money? What are our metrics, and are we achieving those?”

And then there’s the whole political side, which is maneuvering around, not only your investors, which is key and critical and important, if they’re putting money into you and your business. And typically it’s the team, and the belief in the team, and then the idea will flow, in theory. But it’s also, around your…navigating the waters with your partners. So you’ve got four of you are co-founders, which is very difficult. And I’m sure there was some tension, around idea selection. And then there’s also the employees, who have to look up to you guys and think “Do they really know what the hell they’re doing, at this point?”

Mikael: Right.

Rob: And all of that coming together, Christmas eve, you land the 2.1 million dollars. You’ve got the metrics behind you. The growth is continued. You’ve managed to hold onto every rein possible. You’re, like, doing this.

Mikael: Yeah.

Rob: And then, so you take off. And then, January rolls around. You’ve got fresh, flush, pockets. And your employees are satisfied. You guys feel great. Your original investor feels smart about his decision. Things must be rolling. Like, you must feel great at that moment. Am I right?

Mikael: It’s always, I mean, I like to make the comparison a lot, it’s like you’re an athlete. And you look at someone like Michael Jordan, for example. Every summer, for his fifteen, sixteen year career, he added a new move. So even when he’s averaging 30 points a game, he’s the MVP; he knows that he needs to add another move. You know, he knows that you can’t…there’s no…what is success.. What do you need…that you’ve made it? What is that actually defined as? And I’ve always sort of looked at that approach, when we’re moving forward. When you’re doing well, you’re like, “When is that going to end? Is it really that well? Can you do better? When it’s going not so well, how do we make it better when it’s even? When is it going to go up or down? So it’s a good thing and a bad thing, but it’s the road we chose. We’re running a company. We decided to get investors and you have to have a sense of humor with it. You have to sort of be able to remove. It’s a very challenging thing to do. You’ve got always these things you’re thinking about all the time. Try to remove a little bit each day. Just take that five minutes, ten minutes. I try to do my hip stretches and get out of my desk, or walk around [Montreal], just around the block, and just remove that layer and then come back in. And sometimes I’ll sit here — it’ll be 10 p.m. at the office — and look around at what was built from nothing. You have people here who are all building towards this thing. You have a computer. These are little things that you take for granted. and I think it’s good to look at that every now and then.

Rob: People always say, “We don’t think enough,” right? And it’s good to be reflective, and clear your mind, and do some thinking. I’m going to ask you a question. I want you to think about it for a second here.

Mikael: Yeah.

Rob: If there’s one or two things that we can leave the viewer, the listener with, when is the right time to engage with somebody like Crew or you guys? At what stage of a project? What should they be looking for in a developer? How do they decide? So I want one or two hints there. So I want you to think about that, but I want you to answer this question: how different are you as a leader and as a CEO than you were a year and a half ago, after going through this experience? I was so impressed with you 18 months ago, but you seem to be much more now in tune with whatever. It’s the blood flow, your heart, your head, alignment with business, understanding, working with customers, working with clients, working with employees and investors. How different do you think you are from 18 months ago?

Mikael: Yeah, when we were just first starting 18 months ago, it seemed like it was always about if we just build this product and then the company will follow and all these other things will just sort of happen, fall into place. But you realize that the actual thing is you’ve got ten different products you have in place — that’s product. You have investors — that’s product. Almost everything that you deal with on a daily basis is its own thing and you have to put as much effort into each of those channels as you would the actual software product, Crew, as a website. So thinking about that, and thinking about how can you create enough energy in yourself so that you feel it every day. I actually used to lift the apps where you can track your habits. I have a reminder every morning that says, “Bring it.” No one’s in my group.

Rob: Just you.

Mikael: But it reminds me to take it up that next level for everything. Today is a day, again, that we get to build a business that you want to build. You brought this to people, people believe in you, people are either giving you money or there a customer, or you have somebody working with you as a team member. Bring it. So we’ve written on the Crew blog too about how to work better, because the only thing that can almost hold back your company is yourself. You run out of energy, and if you’re not operating at a certain wavelength, everything can suffer. You can’t prioritize properly, you don’t have ideas that are as good, the things you build aren’t as good. So a lot of our focus has been how do we maximize that? And that’s why you’ll hear a lot of things talking about the emotional connection, heart and your head. I really believe in a lot of that stuff.

Rob: From something, so, that was a great answer, to tactical advice. Yeah. I want to leave somebody with something that they can go away and do right now and try to figure it out. So talk about that and then we’ll end, I promise. How do people find developers? How do they know when it’s time to jump in and start leveraging Crew? Do you have any advice for somebody when they walk away from this?

Mikael: Yeah. Yeah so, I think there’s two main inflection points where Crew is a good option. And even when people are coming to us with an idea, if they’re too early, I’ll often say, “Here’s a couple of things that I would do and it will help you in the long run. So, let’s say you’re coming in with an idea, and you want to build that first prototype. Hopefully you’ve already done some validation. So, you sort of know who your customer is, and [link canvas] is a great thing to do, great exercise in the beginning. Just to know the different parts of that business in a very quick view, your idea and where you want to be. Is this going to be your full-time business, is this going to be part-time? Defining these things up front will really help make decisions for how you decide to move forward and build it. But, coming in, building that first prototype is a great way to work with Crew. I mean, we have an independent developer that you could work with directly and build that first version, but if you validated some of it, you’re not going to waste building extra features, you’re not going to waste money and time, because a developer can build almost anything today, apart from some very difficult things.

Most applications, you have very similar features that need to be used, and the hard part is building that whole community around your application. Making sure that you define those things early on, but building that prototype is one. The second is, let’s say you have your prototype built, maybe you have some funding, now you want to take it to the next level; or you have a website and you want to go mobile. You know what works, and you want to build that real experience. You know that mobile, there’s a different bar, right? When you release something in the app store, because of the way it’s structured and because of the way Apple feels about things, you need to build it at a certain level of expectation. And it can be hard to do that by yourself; sometimes having a professional, even if you just want to see the mockups. Even if you just want to see a couple of screens first. And we’ve done a lot of projects like that, where you don’t necessarily need a massive budget and go and build the whole thing from scratch. Maybe there’s a couple of main screens that you can see and get that. So there’s always options, and with Crew we try to treat it like that, rather than spend four months where you’re coming in with an idea and leave with this product with no validation. We try to bring some of the lessons we learned from building a business when someone comes in with a project, and offer expert advice. We can go a different route to building it, it doesn’t need to be this big thing where you spend $50,000 or $100,000 right off the bat.

Rob: And that’s what you want to avoid, and I think there’s a point in time where you have to be able to answer a bunch of questions around the product that you’re trying to create. And it sounds like you guys get them to that point as well. There’s an inflection point, a yes or a no. It’s binary. It’s either “we’re going to build it” or “we’re not”, from a customer standpoint. And you want to be able to get there as quickly as possible, and make sure that if you’re not going to build this, you can actually have an avenue to build what you need to build, based on some smart questions.

Mikael: Right.

Rob: Wicked. All right, where do we send people? Where do we send them now?

Mikael: Pickcrew.com.

Rob: Pickcrew.com. Man, this has been fascinating. I love these follow-up stories. I can’t wait to do it again in a year. Maybe we’ll do it sooner, to see what’s going on, but I think that it sounds like you guys have centered on something where there is absolute value. And the great thing about it is that it’s doesn’t have to be specific to one industry, right? It’s like “pick crew, you can do it for anything”. So whatever happens, if Google Glass takes off, which it may not, or Apple’s whatever, or anybody’s wearable technology, whatever happens, or it could be set top boxes. You guys could be there with a marketplace to build, to find and help people build your applications for those different devices. So I like the generic enough name, and I love the direction that you guys are going in. I can’t wait to sit down a year from now. You’d better not change your company again. Or if you do, it’s just a tenacious entrepreneur and all that stuff. Mikhail, thank you so much for doing this. I really appreciate your time.

Mikael: Thank you, Rob.

Rob: Go to pickcrew.com, go to pickcrew.com, go to pickcrew.com if you’re looking to have anything developed in the mobile space or anything. Please support these guys. Montreal, Canadian, Montreal Canadians, Montreal, Canada based folks, these are hockey references, and if you’re not Canadian, maybe you don’t understand it. But go to pickcrew.com. We’ve been speaking with Mikael Cho, who is one of the co-founders and the CEO of the company, and this is his third time on the show and I can’t thank him enough. So, Mikael, thank you so much.

Mikael: Thank you, Rob.

Rob: And thank you guys for watching and listening, wherever you might be, whatever you are doing. I know you’ve found tremendous value in this episode, so come back next time for another episode on Untether.tv. See you later, everybody.

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About Mikael Cho
Mikael Cho Crew Mikael is the founder of Crew (pickcrew.com) and creator of Unsplash (unsplash.com). He graduated from the University of Wisconsin with a degree in Psychology & Neuroscience. Mikael’s writing has been published in The Next Web, Fast Company, LifeHacker, and TED.

About the author

Rob Woodbridge

I'm Rob, the founder of UNTETHER.tv and I've spent 14 years immersed in the mobile and pervasive computing world. During this great time I've helped some of the most innovative companies grow their business through mobile. If you are in need of a mobile business advisor or coach, connect with me here to get things rolling.

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