Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about how they built their businesses. And I finally left San Francisco. I mean, I actually got on a plane, a couple of them and I flew to South America. I’m here in Santiago, Chile, where I’m interviewing entrepreneurs about how they built their businesses here outside of the San Francisco bubble where it’s not so easy to raise money where my kid and I are going to do a lemonade stand. He’s four years old. I talked a lot with him in a coffee shop and two venture capitalists asked if we would charge Bitcoin and wanted to invest. That doesn’t happen here.
Devin: Yeah, no, no, no, no, no Bitcoin run lemonade stands. That’s not the run down.
Andrew: It’s not easy to get money. How much did you raise for your business?
Devin: Just over $2 million.
Andrew: Okay. Yeah, that’s impressive here, isn’t it? That’s not common.
Devin: Sure. It’s what we did. So for sure.
Andrew: So the reason I’m doing this is to understand how companies are built outside of the ecosystem where I feel like we have it easy. And I want to understand how companies grow outside the U.S. Joining me is Devin Baptiste. You just heard his name or you heard his voice. He is the founder of GroupRaise.
Tell me if I have this right. If I wanted to do a big dinner for entrepreneurs here in Santiago, Chile, or in San Francisco, or next week, I’ll be in New York. And I didn’t just want to have to search around for a location that could accommodate 10 people, I wanted an easy place to find only locations that could accommodate a big group. And I wanted one that would donate some of the profits to a nonprofit that I care about. So we’re not just feting each other and enjoying each other’s company and drinking, but also doing good in the world. I would go to GroupRaise. You would help me find the right location in any of those cities, and I could donate some of the money to a cause that I care about. Am I right?
Devin: You got it, man.
Andrew: Wow. All right. I thought, “Wow, what a nice kind hearted person. This business makes sense. Kind of it’s never going to be huge.” And then before we started, you told me the revenue. We’ll talk about that in a minute. It’s actually really impressive. We can do this thanks to two phenomenal companies. The first will host your website right, it’s called HostGator. And the second will help you hire phenomenal developers, it’s called Toptal. I’ll tell you, Devin, about them later. You should spread the word about them here in Santiago.
Devin: Sweet.
Andrew: And I’ll tell the audience about them later. Why don’t we go directly to numbers?
Devin: Sure.
Andrew: Revenue. What are you guys doing?
Devin: So we’re doing about a million in top line. We have a 10% take of that.
Andrew: A million dollars a month?
Devin: A month.
Andrew: In revenue. And people paying . . . did they pay for the dinners on your site, too?
Devin: Yeah. So they either pay for . . . they pay at our restaurant partners, and they collect it that way.
Andrew: And then the restaurant partners collect the money, and they have to tell you how much they collected. And some percentage of that goes to a nonprofit.
Devin: Some of it goes to a nonprofit and some comes back to us.
Andrew: So 10% of it comes back to you?
Devin: Yeah.
Andrew: Okay. But then . . .
Devin: We have some different pricing structures, but yeah, in general.
Andrew: Let’s say in general, 10%?
Devin: Yeah.
Andrew: How much of that ends up in the bottom profit for you, your business?
Devin: We’re not profitable.
Andrew: You’re not. Okay. How much are you burning every month?
Devin: Well, it depends. Last month we’ve burned 8K. So we’re not . . .
Andrew: Not huge.
Devin: Not huge. I think, you know, our goal is to where we went from about 500 restaurants 3 years ago to now we’re about 10,000. So my goal is to get to a million people eating a day in support of a cause. I’m really big into . . . I think the dinner table was the original social network. And I want to have more people come around and do good things about it. And so that really means building a global network of about 150,000 restaurants.
Andrew: How many restaurants do you have now?
Devin: Ten thousand.
Andrew: Oh, wow. Okay, so you want to 15X this?
Devin: Yeah.
Andrew: And the more restaurants you have equals more customers. I would think that you should focus more or that you’d want to focus more on diners.
Devin: Yeah, it’s funny it’s been less counterintuitive. So as we’ve added restaurants that’s exactly, you know, revenue has moved, bookings have moved because a lot of our restaurants promote the program themselves. And so we add the restaurants to the platform and then they become huge advocates for . . .
Andrew: How do they promote you?
Devin: Either by integrating through their website in their actual physical store. They start like listing the program as available. We get actually a ton of SEO now from people looking for a group reservations.
Andrew: Because restaurants are linking back to you. They’re saying if you want to make a group reservation and kick back some money to a cause.
Devin: Yeah, you can make the booking here.
Andrew: Wow. And the reason you’re not profitable as you’re plowing the money back into the business, as you should as a guy who’s raised money, but where is it going?
Devin: You know, it goes mainly into people and tech. So I’d say the vast majority of our spend is on our staff. And then, you know, a lot of the way we’ve done our growth is actually by building a lot of tools to map geography. So we’re really focused on what is the right, you know, mix of restaurants and organizations within a one mile radius? And so lot of the kind of growth behind what we do is just supply demand matching. And so we spend a lot of a lot of money and time feeding that engine.
Andrew: It’s not on advertising. It’s not on having people call restaurants. It’s not on . . .
Devin: So we have a team of about 30 people in the Philippines and so that is a data operation. So we essentially, you know, you could think of it as advertising, but it’s all about the biggest lesson we had was it’s names, names, names, right? It’s what is the restaurant two blocks away from you that you would want to host this event at? And who does that? And for that restaurant to come on board, what’s the organization that they’ve always wanted to work with or they’ve always been aware of?
Andrew: That the restaurant always wanted to work with?
Devin: Yeah. So . . .
Andrew: So it’s you guys looking for restaurants near where your people would be and then calling them up, knowing what organization they would want to be a part of and want to support?
Devin: Yeah. So we have a three-prong process. So the very first thing is we think about like where would these bookings happen? So what are the markets? What are the sets? And a really good example is like a college town. So if we’d like look at UT like in Austin, say, “Okay, UT, there’s 55,000 students, there’s, I don’t know, 1,500 student organizations, they’re doing events meeting constantly,” right? And that’s a really good set because then we say, “Okay, now we know where the demand is.” Then we look, “Okay, what are the restaurants in a one to five mile radius around UT that’s going to be best for this kind of demand?”
And most of these restaurants have always wanted to have a marketing campaign to UT students, but just like never actually freaking know how to do that or logistically support that. And so if I reach out to you and say, “Hey, there are 1,200 UT students, you know, student organizations and 55,000, who are all the time trying to make decisions about where they’re going to take their big group, why don’t you work with us and we’ll funnel those people to you.” And then we go back to the demand and we say, “Oh, by the way, this really great rated restaurant one block away is willing to host you.” And so we do this, identify latent demand, put supply on the ground by using data about that, and then go activate back to the folks who are in that community.
Andrew: Okay. Wow, I love the simplicity of that. And I still think how do you get somebody in the Philippines to know what a UT student is going to want to take your friends out to?
Devin: Yeah. So in the Philippines, they do a lot of the research we actually built . . . our most of our IP is actually in and we built the system that just allows us to see that distance. So we map what the value of a cluster of groups would be. And then the Philippines they actually with a research is the restaurant as the supply side.
So all I’m giving to them is like geo-radial points that turn into a list that has a specific set of Google queries that then they execute on and that list dynamically updates based on supply demand that we have an engine that like calculates. So in the Philippines, all you get is essentially, I need to look for, you know, robot sushi at this corner and we need to essentially receive, I don’t know, 56 leads for this 1 mile radius for us to have the conversion rate to be confident being able to activate that.
Andrew: They get the leads. And then it’s somebody here in Santiago, Chile or in Houston or where who makes the calls?
Devin: So we do a lot of it over email so directly to the businesses. And so these days now, so one of that we talked a little bit before, but kind of the difference between speed and momentum. And so we started just going really small, adding, I don’t know, four or five restaurants a week, just doing this supply demand matching. And then once we started to understand like, “Okay, we could actually predict the name you’ll have an emotional response to, we’re starting to be able to predict this is the nonprofit you care about. This is that pool.”
Andrew: How?
Devin: Just by distance, right? UT is a really good example. If I know that you are a restaurant within a one mile radius of UT, I know that when I talk about the opportunity to connect with UT student organizations, you’re going to have an emotional response to that, right?
Andrew: Right. Okay. But then how do you know what nonprofit they’re going to care about?
Devin: So in that case, we just we group in that category of market, it’s just UT and then we talk about five to seven top, you know, Rotary Clubs or the sports team. Like we give example organizations that we work with.
Andrew: Okay, got it.
Devin: But the main pool is that school. In other cases will be like an elementary school or it’ll be . . . we’ll essentially look for the top five nonprofits in a given city in a given area that someone may have heard of.
Andrew: You know what? By the way, the audio sound . . . I’m wearing earphones here. We’re sitting and having a natural conversation just sitting on the couch here at this hotel. I’m wearing earphones to listen in because I’m still new at this. This is the first time that Devon Meadows came in, and he just made a couple of small adjustments to the mic.
Devin: Yeah, it gets to be [inaudible 00:10:16].
Andrew: And now I feel I don’t even need earphones. It’s just is super clear. The first time I did this, I kept it like reaching over to my guests and adjusting. It’s amazing how someone with experience can make a simple little tweak that looks insignificant but changes everything.
Devin: Yep.
Andrew: All right. Let me understand something about you. I’m looking through my notes here for the article. I think it was in Forbes where they said that you had a very yawn-like growth for a few years, and then suddenly you took off. It’s that yawn-like growth that allowed you to take off later on. What happened?
Devin: Yeah, so really, I think we initially launched, we launched in Houston with six restaurants and a concept called Mission Burrito and our first kind of national deal was with a company called Jason’s Deli. So Jason’s Deli is like a southeastern deli chain that we’ve like done millions and millions of dollars in revenue now, and it was the like kind of marketing director who was running just the Houston locations, took a shot with us. We got 17 locations. She ended up getting promoted to go national.
Andrew: Let’s pause. What happened with the promotion? I want to go back a little bit because that promotion helped you guys grow. Going back a little bit, where did the idea come from?
Devin: Yeah, so growing up, so I used to play in a band actually. So I played keyboard. I sang. We did this around the city of Houston. You know, restaurant owners, bar owners became my friends, my mentors. We’d just kind of hung out and talked and I was talking to . . .
Andrew: Because you were playing at restaurants and bars.
Devin: Yeah, because I was playing. I would play for money. I would play for food. You know, we just had a good time. And one of the guys owned a restaurant and he was like, “You know what? I know, there’s a ton of organizations around me all like everywhere and I’d love to have them in but I have no idea how to reach out.” And growing up . . .
Andrew: To bring in the organizations that would host their dinners there. Like how do you get the rotary club to do a dinner here? Got it. Okay.
Devin: Yeah. And so growing up, like I’m an Eagle Scout. I was, you know, in the marching band. I just did a ton of activities. And I was like, “Yeah, I’m pretty sure I can get an organization in here.” And I called up a group I knew and I said, “Hey, you know, this restaurant, they’d be happy to host you. They’ll donate 20% back what you spend. You want to do it?” They were like, “It sounds awesome.”
Andrew: How do you know about the donate 20% back? That that would be a thing?
Devin: I talked to him and I said, “Hey, why don’t we put an incentive. It’ll be easy for you to be able to get a group in if we have an incentive.” And he was like, “Oh, sure.”
Andrew: So if it’s just, “We have space for you, and we’ll make you feel comfortable,” it doesn’t mean anything because every restaurant could say that. But if it’s, “We’ll also donate to an organization.” Got it. How do you know what organization to pick?
Devin: So the group chose. So they chose what organization they wanted to support. And I just remember, you know, he was imagining something like 30 people would come and 300 people came. And he was just like floored with excitement. I saw the look on his face. I saw like someone who would . . . this was the largest. We like broke his fire code with people coming.
Andrew: Really?
Devin: Yeah, it was huge. And then I saw a bunch of people sitting, eating, having a great time, just like talking, you know, doing almost what we’re doing now. And I thought, “Like I wonder how many places look like this where you have venues where people really want customers to come in and they’d be happy to host and you have people who are just all the time thinking about like, ‘Where we going to eat? What are we going to do?” But there was a piece of . . .
Andrew: This is going to be a business.
Devin: Yeah, there was a technology. This could be cool.
Andrew: Were you always entrepreneurial? Were you always thinking, “Here’s an angle. Here’s the thing. I can make it bigger”? I was as a kid.
Devin: Yeah. So for me high school was the moment that entrepreneurship like hit my brain. I remember like writhing in my bed not able to sleep with ideas. It would just like it would get me. And so the very first thing I did was this game tournament. It was like a Halo tournament. And I remember I presold tickets because I didn’t have the money to book the venue or anything. And so I presold tickets, and I like presold that I had like $600 in cash. And like from the time I thought of it to like the time I had $600 was like 2 days. I’m like, at that time, like $600 is like unreal amount of . . .
Andrew: I mean, there are a bunch of people listening now who are adults would say, “$600 from a thing that I created would be huge.” Yeah.
Devin: Yeah. And I just remember the high of that experience. And then I started like designing t-shirts and selling t-shirts like my friends and it was just like became was like little . . .
Andrew: Where was the Halo tournament going to be?
Devin: What’s that?
Andrew: Where was the Halo tournament going to be hosted?
Devin: It was actually going to be hosted at my church.
Andrew: Your church would then let people bring in their own laptops and . . .
Devin: Bring in game consoles.
Andrew: Oh, sorry. Right of course. They would bring in their own Xbox and the church had a projector or something.
Devin: Yeah.
Andrew: Wow. Okay. All right. And so you started saying, “All right, I can also do t-shirts and so on.”
Devin: Yeah, yep, yep. And then, you know, when I was 19, I started . . . well, I guess, before that, I started doing a music festival. And so I was in that band that I mentioned and we always wanted to play 1,000-person show, right? But nobody would hire us to freaking headline a 1,000-person show. And so I said, “You know what? Why don’t we just make our own music festival and then we’ll headline it and we invited 1,000 people.” It’s kind of the ultimate, you know, like, bait and switch. But we did that.
And that was like a real foray into planning and doing an event, and we ended up having 1,000 people come. But that process like, I invited everyone to this park that I didn’t actually have the permit for. And so like two days before, I wasn’t sure if I like I had 1,000 people coming to a place that I didn’t have. And it was this was the first time as an entrepreneur that like my stomach like rolled and pitched with challenge. And I remember being on that stage at the end, like playing a show in front of 1,000 people, and we actually donated the profits for that to a charity. And just like the ultimate high of successfully having a vision and seeing it come to fruition.
Andrew: Did the stomach churning help the high, or did it take away from your desire to do it again?
Devin: It didn’t take away from my desire to do it again. In fact, I mean, so for me, my faith is a big part of my life. It was probably the moment where I decided that I wanted my career to be going out and doing things so I didn’t know how I would do them. I was just like, “This is the thing and I have no idea how it’s going to happen.” I mean, just trust God and push through and . . .
Andrew: You still believe in God?
Devin: Oh, man.
Andrew: And so how does God when you have a vision of something bigger help manifest that? Give me an example of something big that you said, “I trust God is going to help.” Maybe take it away from business, you’ve traveled about a bunch. Is there something like that>
Devin: Yeah, I mean, so for me and my story in my life, there’s been just a lot of moments of providence. So, you know, actually, we’re literally our office here in Chile is in Providence here and it’s never lost on me that like how I ended up in South America was pretty crazy. But one of the very first kind of big moments in my life was actually meeting my wife. So I was in Taiwan at the time, and I had gone to Taiwan for a study abroad program. And I was going to church in Taiwan in Chinese and at the time my Chinese wasn’t very good. So I like didn’t understand anything and so I decided that I wanted to go and find an English church that I could go to. And so I plotted my path to this church.
And I was sitting on a bus and just writing kind of thinking. I don’t know what I was thinking. I was in Asia. Just kind of thinking about life in general, and I missed my bus stop. And I missed it so bad that took me two and a half hours and all my money to get back to the part of the city I was trying to go to. And when I got there, the church I was trying to go to had already happened. It was over and so I had been in Asia for a while and I was like, “You know what? I really want, I want a bagel.” Like I’ve been eating rice and I just like wanted some bread, you know, and I love bagels. So there’s this bagel shop. This was like cool. So I decided to go get a bagel but I didn’t have any cash so I go to an ATM. First ATM I go to it’s all out of money. I go to another ATM, it’s all out of money. I go to another ATM, it’s all out of money.
Andrew: I can’t believe that ATMs run out of money. It’s okay.
Devin: I know. I’ve never had this experience in my life. And then at this moment I’m like, “Okay, all right.” I was like, “Okay God, where should I go?” And there’s another church there and I look up and I see this church and I decided, “Okay, I guess I’ll keep looking for churches instead of following my stomach.” And there in the front row, I walk up and I asked, you know, “Do you guys have English services?” And they said, “Yes.” And I said, “When?” And they said, “Right now.” And I walk up and a couple of weeks before I was on a bus with my now co-founder who I met in Taiwan, and I saw this redhead on the front of this bus. She was speaking Chinese and she was like talking about going out and getting drunk and I was like, “Who the heck is this chick? Like she thinks she’s so cool.”
And like made fun of her shamelessly on the back of this bus. And when I walked into that church in the front row, was the red head from the boss. And was like, “Man, she goes here.” And we ended up getting . . . at the end of church, like someone came up and introduced us and we were connected. And she’s like, “I’ve got to run.” We were cut out of the conversation. “But I’m going to choir practice, What are you doing? Do you want to come?” And so I was like, “Okay, sure, I’ll go.” I didn’t have any money so I was like whatever I do. And then choir practice ends and she’s like, “Oh, we’re all going to lunch. You should come to lunch with us.” And I’m like, “Oh, no, it’s okay. No worries. I’ll catch you next time.” I didn’t have any money. And she’s like, “No, no, they pay for you the first time. Just come.” I didn’t tell her I didn’t have money, but she just was like, “Just come, they pay for you.”
So we go and we’re sitting, we’re eating, we’re talking and she’s telling me her story. And I’m like, “Dude, I can’t imagine like I’m having lunch with this redhead from the bus. Like this is super crazy.” And I don’t know if you’ve ever been in this environment where you look around and you’re kind of at the end of meal and you thought someone was going to pay for you and you realize like no one is going to pay for you, and you don’t have any money. And I was just like, “Man.” And I was just feeling nervous and Jessica, my wife, she could tell. She’s was like, “You know what? I got this meal.” And, you know, she’s like, “If you agree to come back again, I’ll give you the money for the meal.” And the rest as they say is history. And actually, this last year, I like reflected back on that experience.
And I was like one of the things in my life has been that like that day I really wanted a bagel but instead I got a wife. And like that exchange of like actually meeting my wife like when my goal was to get a bagel and do this thing. And I found my wife to be like, infinitely better. There’s like no amount of bagels on the planet that would satiate what she does for me.
And so I’ve seen that in my faith life in so many ways where, you know, I’ve had a goal and God has given me a gift. And those gifts have been infinitely better than the things I was chasing or the amount of money I was going after or whatever that goal is. And so I’m really grateful for just the opportunity to pray and allow for the directions. When I look at my life what’s most valuable, it hasn’t come from just acts of my will, it’s come from these gifts.
Andrew: And even in business when you feel this could be the end, you regain your confidence in yourself because you feel a divine connection to . . . I don’t even know how to say it but you feel connection to God and the God will find a way even if it’s not the way you expected and even if it’s not the answer you wanted.
Devin: Yeah, and I think it’s also like not even just about outcomes. It’s more about the experience of a journey of the success of . . .
Andrew: Like what? Take me to a place where you felt really at your lowest point. Is it when you were trying to fundraise? Is that it? Was that the biggest one? Or actually, [was it down 00:23:06]?
Devin: So one of the lowest points I had actually probably, you know, if you want to talk about a God story. So last year or, yeah, probably last year, we were in the middle of a fundraise. And we essentially had a bunch of reasons as to why this fundraising round wouldn’t close. It was just like . . .
Andrew: Like what?
Devin: Well, I can’t exactly . . . Some of our investors had very different ideas on what the term should be. So, I essentially went out to fundraise. I oversubscribed really quickly into a round. It was great. And once you close it and then, you know, I had an investor who just rejected the terms very intensely and like just wouldn’t let it close and just cause this whole thing. And so anyway, it started extending the time here, about four months past when we expected to close. So I was really like, at that point, we were super low on cash, just I was days away from bankruptcy. Now, I had this round, but it was still this like very intense kind of broader experience. And the real cash gap we had at the time, so like, kind of, to have enough time to let that round close was $100,000. And there’s a group in Texas called Capital Factory.
Andrew: I know them.
Devin: Yeah, Josh Baer. And so we essentially like needed $100,000 and one of their associates, like showed up in the office, and they’re like, “Hey, we’re looking for a diverse company with a founder who’s raised money in the past, who has some social element who’s interested in machine learning.” I was like, “Oh, wow, you should.” Like in my office, like I didn’t like research it online. Someone would just like pat me on the shoulder and was like sitting in my office saying like, “I’m looking for that. Do you know anybody who’s like that?”
Andrew: But how did they end up in your office?
Devin: They were just looking for companies in Houston. They decided that they wanted to . . .
Andrew: And they were just walking door . . . No, because you were in a co-working space that they could go and look.
Devin: Yep.
Andrew: Got it. Okay. And so that is the divine intervention that you were talking about earlier?
Devin: Yeah, I mean, so for us having the exact . . . for me like it was just an experience where it was the exact amount of money we needed out of randomly nowhere and out of anyone in the city. It came exactly on my door. And the craziest thing about that actually was in the very end, there was . . . so the way it functioned was a competition. So Capital Factory actually started to do these kind of challenges. So they’ll do like a challenge for machine learning or they’ll do a challenge for and this . . . And Houston, they did a diversity challenge. So they wanted to find a company that was like . . .
Andrew: As diverse as possible.
Devin: Yeah. And actually, the amount of turnout from that was like fairly amazing. Like the companies that came through. And so we ended up like originally not . . . like I thought my round was going to close, so when they came into the office, and I was like, “I don’t really know if I want it like . . . ” at the time, like $100,000. And then as we got through later stage of the process became pretty much the exact amount of capital we needed. And I was in my office, probably working it, I don’t know, midnight in Houston. And I was talking to two guys who is like the only two guys who are also in the office at that time. And I was like, “You know what? Like I don’t know these guys, but if we’re both working and midnight in the office I’m kind of curious about what’s your story like who are you, that kind of thing.”
And I was just kind of telling a little bit of backdrop, and I was talking about faith. I was talking with God. And I said, “You know, in my experience with God for . . . ” I watch God do fireworks and all I do is clap. Like my whole life I’ve just seen God be faithful over and over and over again. And I’ve just found it in this space of gratitude and pretty much exactly as I’m having this conversation with them Minute Maid Park is across the way, and I literally have a video of this. The fireworks start over at Minute Maid Park, and they signed the investment, and I have like literally have like after I say this to them, fireworks start and I get $100,000.
And it was like the most like love note to me. Like I don’t know if that matters to you or anyone else in the world. Like I don’t care if that affects anyone else’s faith. But for me to a moment where my exact statement was, you know, “I just see God do fireworks and all I do is clap,” and then to have fireworks and get $100,000. It was a very, very, very high moment.
Andrew: I imagine there’s some people who relate to that and go, “Finally, somebody who understands how I feel my faith.” And I imagine there’s some people who are cynically or skeptically, I should say, saying, “Ah, it’s just random luck.” But the big takeaway either way is the confidence in that low moment that you get from knowing that it’s not just on you, has got to be firing.
Let me talk about my first sponsor. I want to come back to business and then at some point you mentioned diversity. I want to ask you about being black. I want to ask you about being black and being married to a redhead. Black being an entrepreneur in Santiago, Chile, and frankly in Houston, and in tech. But first I’ve got to tell everyone about my first sponsor. It’s a company called HostGator. If you’re out there and you’re looking to host a website, go to hostgator.com/mixergy.
Two things will happen. Number one, you’ll be supporting the fact that we’re able to do this. Only HostGator will say, “Andrew, we’re going to give you enough money . . . ” not only HostGator, HostGator and Toptal are saying, “Here’s money. Go travel to Santiago, Chile, go record interviews with whoever you want and we don’t even care. You can say whatever you want. You can go interview whoever you want, but just make it happen. If it’s good for entrepreneurs, it’s good for us.”
And the other thing that that comes to mind is how you were able to just kind of create as a high schooler different businesses, launch them up. I keep stressing, even though HostGator doesn’t care whether I do or not, that they have that option that gives you unlimited domains. Go for that option. Get the ability to just come up with a crazy idea and put it together.
Even if it’s a crazy idea for a dinner or an event for your business or I don’t know what it is, just go pop it up on the web really fast with HostGator and see it grow or die and be okay with it either way because as long as it’s not in your head and it’s out there in the world doing something, you’re becoming a better person, you’re becoming a more experienced entrepreneur. So hostgator.com/mixergy.
Devin, I didn’t even say it’s like the lowest price for HostGator everywhere. I should emphasize that. I won’t. Hostgator.com/mixergy. They support me, support you guys listening to this. And if you sign up, I think you’ll get a really good package from them for hosting websites.
Let’s come back to the business. You found this one woman she said, “You know what? Jason’s Deli will work with you. We’ve got 17 locations, great.” Then she disappears or could have disappeared because she got a promotion. Instead, what did you guys do when she got a promotion?
Devin: I called her and I said, “Hey . . . ” and this is actually really like before we had even really proven out a ton of traction there. I called her and I said, “Hey, would you mind taking us national with you?” And she said, “Sure.” And so we went from 17 locations to 200 and overnight and that was like it went to 30 cities from one city.
Andrew: Was it really . . . would you mind? I’m trying to get a sense of, of who you are as a person that makes you so persuasive. Partly is you’re just a really good . . . You’re comfortable with people. I tried when you got in here to see how comfortable you are with me, where your buttons are, where I should stay away in the actual interview. There wasn’t anything. I feel like if I needed a place to stay tonight, I could stay at your house. If you needed something for me, you could ask me for without any hesitation. There’s a . . .
Devin: You can literally stay at my house.
Andrew: Yeah, I sense that immediately. So it was it just like that with her? Just would you mind taking us with me because I could use the help and this could actually help you or what? What’s your sales process using this friendliness?
Devin: You know, to be honest, it was that simple. I literally called and asked, and she said, “Sure.”
Andrew: See, for me, it would be more of, “This is our opportunity to go national or we could lose all of our customers because we’d lost our champion. This has got to be done right. Let’s research her. What does she care about? What’s in it for her? Let’s research her business. What is national . . . ”
Devin: Her name is Grace.
Andrew: Grace. Perfect.
Devin: Never been lost on me.
Andrew: So then that’s my way and I feel in some ways my ways overkill. That’s why I’m wearing earphones instead of just having a natural conversation with you without earphones. I want to listen in. Is your way really this like chill and friendly? You didn’t have any stress about losing the deal?
Devin: I wouldn’t say I didn’t have any stress about losing the deal. That’s not necessarily . . . I experience stress like a real way. I’ve already told you my stomach churned these moments of exposure to . . . I still grapple with fear and out . . . I’m very human in that way. But I think my response has been that I think building genuine relationships with people and seeing them as humans versus, I don’t know, transactional or just dollars and cents, I think that those things matter. But I think there are a second order of magnitude. If we build a really great relationship, the things that you could already asked me to come into my house, it wouldn’t be a big deal. In fact, it would be awesome. I just think that that coming from things of like I see you as a person. In fact, it’s kind of weird for me to be interviewed because my whole style is actually I want to know what makes you tick. I want to know like why do you get out of bed. What makes you passionate?
Andrew: I noticed you did that. You asked me, “Andrew, do you still want to do these interviews after all these years? Are you still as fired up?” It was like that kind of interest. So you do that? Is there something else that you do to talk to people about themselves? I don’t mean to be overly anal, but I’m overly anal about it.
Devin: No, in my experience, I would rather hear you. I’d rather just know you and like actually really, truly hear you. I think once people have been heard, then the outcomes . . .
Andrew: But what? I used to understand that’s what people did. They looked to hear people. They took an interest. But took an interest in what? What do we bring it up? So I’ll tell you more anally. Here’s what I would do now. My kids are going through . . . they’re starting to . . . my oldest is going to go to kindergarten.
Devin: How old is your oldest?
Andrew: Four years old. He’s going to be five soon. So fifth grade . . .
Devin: My oldest is five.
Andrew: Right. So I would now that would be my interest. What’s schooling like here? The thing that I’m wrestling with, I would take an interest in you to see how you deal with it. If I was curious about living here, I would ask you, “What it’s like to live here?” I’d look for the personal that relates to me so that I could genuinely be interested in what you’re saying instead of saying, “What does Devin care about in general?” It’s more like, “What do I care about that Devin has overlapping?”
Devin: So for me the thing I’ve learned or the thing that surprises me is always that like I have something to learn from pretty much every human because we all have these different things.
Andrew: So you’re looking for what you can learn from people?
Devin: I’m looking for what gets discovered. So like the number one question I like to ask people is like, “What’s on your mind right now?” Like because I want to actually know what you’re spending. You know, what have you been thinking about recently?
Andrew: I wouldn’t know what I answer I would . . . I guess maybe I would tell you about the recording equipment or something. And so that’s what you’re looking for.
Devin: So I just think when people are actually talking to you about something that they care about, it is way more genuine of an experience. I’d much rather hear you talk about something you care about than hear you talk about something I care about. Because in hearing you talk about something that you care about, I likely am going to learn because you spent a lot more time thinking about that.
Andrew: Obsessing about it.
Devin: Yeah, it’s like whenever . . . so John Doerr is a really great example. He always does these like whiteboard sessions where he like lets the audience ask him like, “What do you want to hear me talk about?” and he puts us in the format. And I’m like, “Actually, I don’t know the right question to ask you to see your real brilliance. Like, I don’t know, actually, where something great is . . .
Andrew: He is the investor. And so would you rather instead of having him ask you, you’d rather say, “What are you obsessed about now? What are you taking an interest in?” And so that’s what you might do with Grace to get to know Grace. And that’s what you do with customers. And I’m assuming it was you in the partnership who is talking to Grace.
Devin: Yeah.
Andrew: Bring her on. Okay. So then she said, “Okay, I will bring you on.” As a result, you went from just being in Houston, 17 locations to now being in 24 cities overnight.
Devin: Yeah.
Andrew: Now we have a producer here, producer talk to you about it. Did our producer talk to you or did she do research on you?
Devin: I did talk to her.
Andrew: Okay. Good, good. That’s what I thought. I looked at your eyes and said, “Maybe she didn’t. Maybe she just did research.” Here’s the thing that I highlighted in her notes about the conversation. She said, “It was a jarring experience. I was looking for the fireworks at the end of Grace taking you to 24 cities, instead I see jarring experience.” And other thing that I underlined. “Everything broke.” What happened? It broke.
Devin: Yeah, I mean, so we pretty much had built and optimized to be in one city. At the time, we didn’t even have like an ability to list other cities. We didn’t have a support team that could deal with, you know, people who weren’t in the city. Like it was the first time we had to deal about had to think about dealing with remote support. It was a moment where the product had really been designed for individual locations. And now there was as an enterprise. We had a completely different account manager login scenario. You had different permissions and setup. You know, it was a time when we were hosting, I don’t know, 10 events a month to 50 events which may not seem like a big move. But just the amount of like load on the organization was . . .
Andrew: So then, what did you break? What weren’t you able to do because of that?
Devin: So support broke. Marketing in itself. Like understanding, okay, now we have one restaurant in this random neighborhood in Philly. Okay, like that’s not a community. Like how do you get the next restaurant in Philly or like where do you go from there?
Andrew: When you say support, what’s an example of a problem that somebody had because you guys couldn’t help them of a diner?
Devin: So the types of organizations who were hosting for example. So when we went national, we like started to market less personalized and more kind of, you know, we looked at the whole area region, the market. And we actually invited a fight club to do an event at Jason’s Deli and there was literally . . . they staged and planned a fight in the parking lot of the restaurant. And then fundraised after the fight in the restaurant. And we like invited it, orchestrated it. You know, and like I get a phone call that’s like, “Hey, did you guys just set up a fight in our restaurant parking lot?” And I’m like, “Yeah, I guess we did.”
Andrew: What’s wrong with that though?
Devin: What’s wrong with that? What’s wrong with . . . Well, most Jason’s Deli is like a family friendly non-fight club. Like a bare knuckles fight in a restaurant parking lot.
Andrew: We’re not talking about . . . got it. Bare knuckle, just two dudes punching each other in the face.
Devin: Two dudes punching each other like “Fight Club.” Like the movie “Fight Club” but in a restaurant parking lot orchestrated on the site, right? It’s just like it was just smaller issues that you know . . .
Andrew: But if you had customer service. If this was in your small city and somebody said I want to do a fight club, you would have looked at them maybe personally because . . .
Devin: Yeah. In the very beginning, we looked at. I mean, I remember the first organization was the AOBA and we thought that they were the alpaca breeder and owners association. And so me and my co-founder just went back and forth learning about alpaca facts so that when we met them like we could talk about alpaca facts. It was like the Austin Band Booster Club Association. So we like learned all these alpaca facts for no reason but at the time, I mean, support was me, right? Like it was just a couple people.
Andrew: Got it. And so when it’s you for a few cities, you’re scrolling through and getting a sense of the organizations. If somebody would have said “Fight Club,” you would have at least taken an interest and said, “Huh. Is it like fans of the movie? Let’s go see where they are. Wait a minute, I think we need to back away because we’re going to lose our relationship with our client if we allow this.” Got it. I see how broke . . . by the way, Kevin is your co-founder.
Devin: So actually so I work with for . . .
Andrew: Kevin, Paul, and Sean.
Devin: Yep. There you go.
Andrew: Who is the one you met in Taiwan?
Devin: Sean. And Sean lives here in Chile as well.
Andrew: He is head of marketing.
Devin: Yeah.
Andrew: It’s Paul who is the Chief . . . no he’s Chief Tenacity Officer. Who is coding this up because Kevin is head of business development?
Devin: So Paul is CTO, yeah, and he also kind of leads the engineering at the company.
Andrew: Oh, got it. So he’s doing a play on words there.
Devin: There you go. You got caught in that. Right. Yeah.
Andrew: The Chief Tenacity Officer, sort of. Got it. How did you meet him? He is the guy who created the site that . . .
Devin: Yeah. So I met Paul like on the playground when I was five so many years ago. And I was looking for a co-founder. And at the time it was like right at the end of college and I would . . . I don’t know, we’ve done MVPs with a couple of different people and I called up one of my best friends, actually, the reason why I went to Taiwan and I said, “Hey, man, I’ve been struggling to find a technical co-founder.” And he had no idea. He wasn’t in entrepreneurship. He’s like, “You know what? Like, didn’t our friend Paul go to Rice for computer science.” I was like, “Oh, you know what? Like he did. Let me call him and see what he’s up to.” And he was actually managing a restaurant while like building products.
Andrew: How perfect.
Devin: And so I was like, “Hey, dude, like there’s a restaurant called Tokyo One in Houston?” So he was like this very interesting. He knew the problem space really well. I knew him really well. You know, he was studying computer science but like since high school, he had been developing, you know, products on the web and kind of launching things. And he was really passionate at the time about building a kind of a larger infrastructure in Ruby and Ruby on Rails and so we just kind of started talking back and forth and got really passionate about it.
Andrew: Before we started, one of my ways of getting to know you is saying, “Why do you want to be here? Are you going to . . . ?” And you told me like to speak to audiences about entrepreneurship. I said, “Is this for arrogance?” Again, pushing your buttons to see what where your heart really was. And you gave me this formula about pain and reflection. What was that formula? Is the standard formula? And then I want to know yours.
Devin: Yeah. So the Ray Dalio formula is pain plus reflection equals progress. So, you know, just you go through these terrible things and you just really take the time to think about why they were terrible. And then you’re able to take that [essential 00:42:30] lesson and you get progress out of it. And so but for me, the version of that was pain plus mentorship equals frameworks.
Andrew: Pain plus mentorship equals frameworks.
Devin: Yeah.
Andrew: So give me an example. Is it that bathroom example that we should talk about?
Devin: So that’s like why I think frameworks really matter. I’m sorry, I just touched the mic. I’d be like, “Dude, don’t do that.”
Andrew: All right. And I’ve got the earphones in. I knew it.
Devin: Yeah. Yeah. So very first thing is I’m really into frameworks over tactics. And so I felt like especially when I was first starting in entrepreneurship, everybody was just trying to like crack, get a tip or like crack SEO or crack like one channel and that their business would be solved and, you know, I like just kept trying to put all these separate tactics together and I found that that didn’t work as well as just having a framework to understand like, “Okay, like, what are we trying to do with this phase? And having a pattern.” And so the bathroom example is one of my fastest ways as an example of like why I think patterns are more powerful than tactics. But so pain, you know, like the experience.
Andrew: Wait, tell the bathroom story then if this is a good way for people to understand it, do like a short version of it?
Devin: Yeah, so bathroom story is, essentially, I’m in Phoenix. I’m in an investor meeting with my co-founder and I have to go to the bathroom as one does, especially in an intense environment you like . . .
Andrew: Drink a lot of water. You need a little space.
Devin: Drink a lot of water. You got to get out. I leave my stuff, I go out, and I talk to the receptionist. The receptionist tells me that the bathroom is actually outside of the building. So I’ve got to go outdoors, walk over to another little building. There’s a five-digit code to get in the first door and a five-digit code to get into the bathroom. So it’s a 10-digit number series that I’m essentially trying to remember. Wow, really, like intensely it needing to pee. And so I go out. I successfully make it to the first door, no big deal. I get to the second door. I can’t remember this freaking code. I go back out to look at the 10-digit code that’s up on the wall. I look at it, I see it. I go back out. This time. I’ve really focused on the second five digits. And I can’t get into the freaking outside door.
I go back again the third time, you know, now like trying to look at it. Then intensely, again, try not to pee myself and lose this investment. You know, I just think it doesn’t come off right if you pee yourself in an investor meeting. And then I go and I finally make it through. Later in that meeting, my co-founder and I are kind of at a stage where we’re negotiating terms, and we decide that we want to leave the room and have this talk and we go out and he’s like, “I need to use the restroom.” And this time I get my phone, I take a picture of the thing. We’re going to get this handled. And before I can actually type like punch in the code for him, he just punches in the code for the outside door, no stress, no thinking. He goes and he punches in the code for the inside door, again, no stress, no thinking and I’m like, “Is this guy a freaking genius?”
Andrew: Right. How does he remember this without a problem?
Devin: How does he remember this? You know, and he’s like, “Oh, yeah, the lady at the desk told me you know, it’s like down right, down right.” And it was just like . . . yeah, I remember.
Andrew: On the notepad yeah. Down numbers, right numbers. Got it. And so once he knew it that way, he could just go and through the door . . .
Devin: Through the door and it wasn’t the struggle. And I found a lot of people, right, when we like I’m always interested in privilege. It’s one of the things I’m most like because I think privilege is a good thing. Actually, I think it’s a neutral thing. I think it’s a tool, right? And most people if you have it, you don’t know you have it. It’s like my canonical example of this is clean water, right? Like I woke up this morning. My kids woke up this morning. I gave them water. I didn’t think twice about it and have to do anything about it. I’m highly aware that many people on this planet spend the majority of their time in their waking hours going and collecting water. I want them to have clean water. I also don’t want my kids to lose it. So I think that’s privileged. Privileges.
Andrew: So what’s privilege in this context?
Devin: So in this context, I think understanding the patterns of things is a form of privilege, right? So understanding like how do people actually raise money, right? Like I think what you’re doing is unlocking privilege for a huge amount of people, right? You’re taking someone from the outside that looks . . . it looks like an outcome that people want to get to. It looks like this process that seems really complex that a lot of people will not tell you. They won’t tell you the truth. And I think you do an explicitly a good job being like, “But no, no.”
Andrew: That’s what I’m trying to get at.
Devin: Get at, right? And I think that that’s one of the greatest gifts you can do. And so I think the things you learn on this actually become frameworks that you can make decisions and when you have a framework to make a decision, it’s faster, it’s less stressful, you are able to move through things which other people struggle with and be like, “Oh, yeah.” Well, same problem set that but very different relationship internally and externally to the outcome.
Andrew: Okay. So pain plus mentorship equals frameworks. In this context of the bathroom, it’s you have the pain. I don’t even know how to use this . . . like what’s the code? You got a mentorship meeting. Somebody was going to . . . your co-founder said, “Here’s the plan. It’s like this.” Then you have your framework down right or downside whatever it was. That’s how you do it. Let’s take it to business.
Devin: Yes.
Andrew: Specifically, you told me before we started that the mystery that I had walking into this interview is how did you go from like flat for a bit? I actually don’t think it was flat, but not insane growth to suddenly big growth. And you said and I wrote this down, you believe in compound interest. You believe in doing things so small and so seemingly dopily simple that most people would say, “He’s not even moving.” But you want the little momentum. Talk about that in relation to business so that I understand how a framework would help in business and how you did it.
Devin: Yeah. So I’ve kind of like revealed a bit of this. It’s really simple in the end. So after we went national with Jason’s Deli, we got to about 500 restaurants. And we stayed at 500 restaurants for three years. And we were really like . . . and then the reason why we were there was we kept trying to go for these national deals. And I kept almost closing. Like it was like I had a million dollar deal with Panera Bread that was just like two days from closing, right? And it’s just that I had a million dollar deal with Chili’s. Like I had all of these deals that I put all my effort into these enterprise deals. And when they didn’t close in the end for some reason about public market not wanting to do whatever after we went all this, we had like nothing to show for it, right?
So we put all of this effort in and then the end of the day that wasn’t there. And so everybody who had sold to restaurants were told me like go after these enterprise deals. We’ll get there and I think if I had closed one of those deals and they turn into a million dollars, I probably have a totally different lesson. But instead from that point on, we started really trying to figure out, “Okay, how do we actually scale and add restaurants at a local level one by one, right?” Because it was just kind of this like grisly task people were like, “No, don’t do it.” And we built that engine where we identified, you know, demand, added supply and then activate it.
And when that started, it started really small. And it started with like literally four restaurants joining and then seven. You know, and then, we were adding about 7 a week for a while, and then 10. And then we like started to build more tech around it. And then we hired the first person in the Philippines and then it went from 10 to 20 and 20 to 50. And then we were closing 100 restaurants a week, and then we went to 250. And then we started closing like in a month, 1,000 restaurants, and this all kind of built up in this very, very slow ramp towards, you know, now we close . . . this week, we’ll add another 200 restaurants to the platform, which is we’ll do the whole first three years of the business like hours, within hours.
And so the kind of finding a model for us that was not about, “Okay, is this a model that’s broadly going to get us big quickly? But is this a model that we see is fundamentally scalable that probably starts off looking really nascent? It looks really small. Like, if you look at that traction. If I’m pitching you like, “Yeah, we added five restaurants a week.” It’s like how is this really going to get big? You want to be at 150,000 restaurants. But then, by understanding like what was the underlying data model that allowed us to say, okay . . . like, you know, so there’s a book called “Made to Stick.” I don’t know if you’ve ever read it. So there’s a story in “Made to Stick” about a local newspaper owner who’s deciding like how he’s going to compete against “The New York Times.” You know, “The Times” have more editorial resource, more kind of staff, money, distribution, pretty much like in every way they are superior.
And his realization is that like at the end of the day, no one in “The New York Times” in his community, it’s going to be super rare that anyone’s name in his community is going to actually show up in “The New York Times.” But what he can do is he can make sure that the people in the community are in the paper every day. And he’s like his mantra becomes names, names, names, break the type face for more names. And I think that feeling and experience of hearing your own name, seeing your own name in marketing and it doesn’t matter if you get personalized like that. It drives an emotional response. And so we’ve essentially built a lot of tech around how do we make communities see each other’s names and doing that matching?
Andrew: How? How do you do that?
Devin: So that goes back to kind of what we were talking about before with UT. When I know that you know a restaurant that’s one block away that you’ve always wanted to go to. And I can see that by the reviews and set. So I know which restaurants will be most relevant, which names of restaurants will be most exciting to you.
And the same thing is true. When I market to you like I always talk about your restaurant and a name. It’s kind of like the street you grew up on. And I don’t know if you remember the name of the street you grew up on. If I have a word bubble on the wall, all the rest of the words won’t matter if you see the street you grew up on, you have a flood of memory. So identifying words in the lexicon of a particular customer that will likely trigger a flood of memory or trigger some like desire or either the desire to go there or like a missed opportunity . . .
Andrew: Like so for the restaurant, I could understand the names of the organizations that they might have felt some connection too. Like you said that you were a scout, Boy Scout?
Devin: Yep.
Andrew: So if you know that someone in this area is part of the Boy Scouts saying, you know, the boy scouts have this parent group they might be able to come in here. That would trigger. So you just keep using names throughout with the conversations with both sides. With the organizer of events, they care about these names of restaurants that they would want to feel elevated by inviting their people too. And to the restaurants, they want the business of these organizations that they aspire to work with. I see that. By the way, that story “Made to Stick” is one has stuck with me a lot too.
I keep thinking in social media I should be doing that. I care a lot about other people, less about what I’m doing for breakfast. I’ve been taking pictures of what I’m eating for freaking breakfast. I don’t care about it even. I should be talking more about the people I’m passionate about. But coming back to your story. In that period where you were adding 5 restaurants at a time, not 500, is it about learning a process and improving on it and improving on it and improving on it? Is that what it is? Is that one of the takeaways that I should have?
Devin: Yeah. So I think it’s about finding a process that . . . it’s about in the selection of opportunities and what you’re going to work on, not eliminating things that start really small.
Andrew: Okay. But that part I got. So when you’re starting small, so I’m starting small, I got a little bit of equipment. When you and I were talking before we recorded, you may not have noticed, I wrote a little checklist for the next time of things that I need to know based on what you and I were doing so that I can make the next interview a little bit better. And then the next interview, I’m going to do improve the checklist and make it a little bit better. And a year from now, when you and I are sitting, it’s going to be amazing how Andrew has the little details down because I suffered through them. You’re smiling. You’re recognizing some of this. Talk about how you did it. What is it about the small that allows you to go big and not stay small?
Devin: Well, I actually think it goes back to what you were talking about with this mic, right? Where you realize that a very, very, very tiny change fundamentally changes the output in this massive way. And so I think sometimes when we want big outcome changes, we look for big input changes. When in reality, it’s usually some very small input change. Like so I grew up, we always worked on our cars. Like I was always . . . I hated it at the time my dad . . . I had like a small hands, my hands in the carburetor or whatever. And my dad like when I would see like a spark plug would be out and the entire car . . . or you have two spark plugs out, the entire car won’t work. And you see something like this big, actually, like functions across the entire like system. And so when you’re looking at building businesses, I think oftentimes it is really understanding that a very small adjustment can have this massive output and then if you continue to repeat in those small bubbles.
Andrew: How do you do that? I get it. So for myself here, I will have a chat . . . like you notice that I was wiping my nose a couple of times and the audience probably noticed that was sniffling and it was in the mic. I have a note to myself, see if you can find a mute on a Lavalier so that if I do another live interview, I can mute myself when I sniffle because I have problems sniffling forever and unmute myself when I’m ready to talk as I do in recorded remote interviews. I could do that for myself.
When it comes time to working with a team, it took me a long time to work with them in a way that will allow their knowledge and little things that they do to improve. To not just happen in the moment and be forgotten, but to go back into something that they could improve and more importantly be clearly written so that the next person could follow up on that and could build on that improvement.
When you’re starting out, going after five restaurants, what’s your process of taking something that’s small and helpful for you? It makes incremental progress not losing it. And then when you hire someone else having their incremental progress recorded and improved on.
Devin: So I think it’s a great question. It’s a great framing. And I actually think about it a little bit fundamentally different. And the way I think about it is actually how can you capture that knowledge in technology? So instead of like me making that next hire and how do I train that next hire, which is in another important part, how do we codify a certain behavior? Or like, how do I first . . . so whenever I write an email, even if the email is going to go out to a million people, I always write it to one.
Andrew: Right. Okay.
Devin: So I’m just going to talk to Andrew. I’m just going to talk about Andrew’s life. I’m not going to think like is this data scalable? Or like can I find it? I’m just going to say like what would that great be? And then once that’s defined, I’m going to work backwards and then find like to teach a machine how a machine could write an email just to Andrew that is just as personalized.
Andrew: If you’re writing an email to a restaurant but you know it’s going to go into your software that will fire off personalized messages to a lot of restaurants. You think, “What’s one restaurant that I really want to work with? You know what? I’m going after The Chili’s type of fast casual restaurant now. Let me write it to Steve where remember worked at The Chili’s that I was trying to get to.”
Devin: Yeah. And I pull up his LinkedIn and I get really focused there.
Andrew: And you sit down and you write it. Okay, you’ve written it to Steve, you send it out to several fast casual restaurants. Now that’s out there, you get your results, but you want to sit back in a moment of reflection and use it to improve what happens in the future. So the machine could do this. Machine meaning actual software or a team of people. What’s your process for taking that back and doing that?
Devin: Yeah. So, I mean, I think the beautiful thing about data is that it’s very truth telling in terms of outcomes and results. So what we’re essentially looking for is once we run, I don’t know, let’s say 25 different experiments. So we’re really big into saying, “Okay, what is the set of experiments that we’re going to do? That’s when we’re going to optimize the open rate or we’re going to optimize the set.” And then once we have that, “Like what’s the framework? Like what actually is underneath that that caused the 45% open rate?” And, you know, one of the biggest things we learned is names. In the subject line, if I dynamically create a subject line that has your name, I can do this.
Andrew: And so you’re sitting down with your team and you saying, “Our goal now is to get more people to open up the messages that we send out to try to get restaurants to pay attention. Let’s try a bunch of experiments.” You try a bunch of experiments, names comes back at the answer. And now where do you codify that so that the next time you’re writing a different thing that’s not this email, the company knows the [day before 01:00:25]?
Devin: Yeah, so either one, you know, we have a wiki that actually goes to the writing process. Or two, we actually then just take that knowledge and then all the campaigns. So the structure we have is we essentially start really small. We start with, I don’t know, let’s say 300 restaurants we’re targeting and we get all the way to let’s call it 300,000. And so the 300 are the tip of the spear. They’re like what are the [guesses 01:0050]? What’s working? And so once we learn what works with those 300, we then like change the next series that is now, let’s say, 3,000. And then based if what we learned with the 300 is still valid, then it graduates up to a larger sample size. All the way up until through sample size like implementation, we have extra confidence in the actual answer to the results. And then those results for those campaigns are then codified into the method of what a machine decides who should get marketed to next.
Andrew: All right, I’m with you. Let me take a moment to talk about my second sponsor. I realized we went a long time without me telling you about Toptal. Toptal . . . have you heard of Toptal?
Devin: I have.
Andrew: You have? What do you know about them?
Devin: They provide top talent. I think they their claim is the top 3% to 5% of a given industry . . .
Andrew: Wow, only three. They don’t go top five.
Devin: Okay. Yeah, there you go.
Andrew: Five percent of developers?
Devin: I’m just giving my take.
Andrew: What’s your big challenge for hiring developers? This is actually something I should bring back to my ads. Ask the guests about their big problem. Talk to the guests about . . .
Devin: Like, come on, man.
Andrew: So what’s your big hiring challenge when it comes to developers?
Devin: So, actually, that’s one of the great things about being in Latin America is that a lot of people overlook the talent here. And, in fact, a lot of the Toptal people are people who are here who . . .
Andrew: That’s one of their big insights.
Devin: Yeah.
Andrew: And you know what? No one is paying attention Latin America developers.
Devin: And so they sell them to you at U.S. rates. But if you’re here . . .
Andrew: But cheaper than U.S. rates.
Devin: Well, a delta between Latin American rates and U.S. rates for a profit.
Andrew: Right, right. So you’re here in Latin America, you’ve got the developers in Latin America, you pay Latin American rates. Toptal pays Latin American rates and they charge Americans and Europeans and other entrepreneurs a little bit more.
Devin: Yes.
Andrew: Right, fair enough
Devin: Which is less than the U.S. rates.
Andrew: Going rate. Yes, exactly. And that’s the beauty of it. It’s people who are overlooked who are phenomenal at their jobs. They could work in the U.S. in many cases, absolutely. They could come into the U.S. I go to these big dinners and lunches and things that go on in the U.S. within companies. Now that my wife is very much an executive in Silicon Valley, I get to go to see these things. These people are from all over the freaking world. The people who are on Toptal, no doubt can come and work here. They don’t want to leave their family behind. They don’t want to leave the lifestyle behind. They like where they are.
Devin: But here is not the U.S. But yes.
Andrew: It’s not. They prefer it.
Devin: I was just saying here but I guess we’re talking about is . . .
Andrew: I’m saying the developers who work outside the U.S., who work in Eastern Europe, who work in South America, they don’t want to leave their families. They don’t want to leave the lifestyle that they love. They want it and they want to work for companies who are working on challenging issues, challenging problems. Anyway, that’s Toptal model. They find these people. If you’re looking to hire developers at great rates, not . . . you can definitely find them cheaper on the freelance sites. Absolutely.
Devin: That is well curated, right?
Andrew: Exactly.
Devin: So I think Toptal, I think, you know, if we’re going to talk about their there . . . if you’re not on the ground and you have a hard time curating like we’re here. So we have an advantage of actually being here on the ground. I think they allow you to get access to a talent pool that you couldn’t have access to and they do the curation for you, which is a good deal.
Andrew: Great curation. You can often hire within a couple of days or actually they’ll put people in front of you and then within a couple of days, you could get started. If you need to hire, go to toptal.com/mixergy. That’s top as in top of your head. Tal as in talent as Devin said .com/mixergy. And they’ll give you 80 hours of Toptal developer credit when you pay for your first 80 hours. That’s phenomenal. And they’ve got a no risk trial period. Go for details by going to toptal.com/mixergy, toptal.com/mixergy.
I didn’t ask you yet about being black.
Devin: So . . .
Andrew: But before we started, I said do you feel comfortable with me bring this up? And I explained to you that in the past I would have been too embarrassed to bring it up because we’re all the same and all . . . right? Or I would have been worried about bringing it up and having a faux pas that would have then made me look racist for bringing it up.
Devin: No, yeah, I assume.
Andrew: And then the thing that got me was I do interviews and an audience of people who are outside the U.S. who are not white males will say, “I need you to see me.” And I for a long time said, “What do you care?” They’re doing the same thing but I can’t keep saying that. And hear people say, “No. I want people like me.” And I can’t keep listening to them and then say, “No. You’re broken in your understanding.” I have to accept that they’re looking for something. So talk a little bit about your background.
Devin: Yeah, I think on that point, you know, I also growing up I thought, you know, I’m going to just focus on achieving regardless of any aspect of my background. And that, you know, like, I think, for historical reason . . . historically, you know, segregation existed, right? There were all these things systematically . . .
Andrew: In the U.S. Where you’re from, right. Yes.
Devin: Yeah, in the U.S. And now a lot of those layers have been pulled away. So this is big opportunity to go forward. I think the big thing that’s missing is the path of knowledge and kind of . . . some people really need to see themselves represented in order to feel . . . like to feel as though it’s a path that they can take it. I never like . . . like I told you before. So my mom was the first black woman to integrate and her parish in Louisiana. She went to school. She went to a school that was a white school. And she was the only one to go. It was an optional thing. You didn’t have to go. And she was the first one to go. And there was definitely no one like her at that school. And three days later the Klan showed up at her house and burned a cross, right?
Andrew: To get her to stop coming to the school.
Devin: Yeah. To intimidate her.
Andrew: And was she intimidated?
Devin: No. No.
Andrew: Why not? I would be honest with you. I would be intimidated. If somebody . . .
Devin: She had amazing parents, right? My grandparents just explained that world of hate, and she knew. It wasn’t as though when she made the decision, she was a high schooler, that she didn’t know that people would have a negative reaction, right?
Andrew: She knew that this would be negative. She didn’t maybe expect a burned cross. But she did expect some harshness.
Devin: Yeah. I mean, I think, that’s a part of being black is that there’s often moments where you kind of expect . . . so harshness for being who you are is something that is a given in many of the cases especially and historically inside of the black community, right? So not being able to stay at a hotel. Not being able to sit in a certain place. Not being able to go like . . . and if doing these things experiencing repercussions. My grandmother passed a voter’s right test and was the first black woman to vote in her area. I took that test actually just last year. And like I . . .
Andrew: You couldn’t pass it.
Devin: . . . could not pass it, right? She studied intensely to be able . . .
Andrew: Just to for the right to vote. And this was a bullshit law that they put in place to keep her from voting. And they put this obstacle in her way. She overcame this unreasonable illegal obstacle. And I get it. You said that even to this day when you walk into a room you feel like the outsider. I’m not phrasing it the way you did. Talk about that.
Devin: No. So I talked about the uninvited which is . . .
Andrew: Uninvited is the word?
Devin: Yeah, which is this kind of idea of there’s a table, right? Whether you see yourself. Whether you see . . . when you look at historical figures, you know, when you read about Edison. There’s some people who read about Edison who just see like that could be me. I could be an inventor. I could do that. And there are other people who look at the history of the world and see a bunch of white men who’ve run it. And look at the kind of history in their family. Either, one, they don’t have history in their family because it was systematically taken away.
And so when they look for that achievement, they don’t actually see for . . . if you look back for thousands of years people who look like them achieving the things or they don’t know those stories or they’re not aware of them. And so when you hear of someone being successful, it is a learned experience where you don’t equate that you could have that success. And so I call anybody who calls in that category of not seeing that the uninvited.
So being here in Latin America, you know, whether that’s from looking at the Valley and seeing what’s happening there or, you know, whether that’s being African American looking at these different kinds of environments. You know, before Barack Obama was president like you’re not . . . you know, Tupac wasn’t singing songs about not being able to be president because that was not true at the time, right, or as a true idea of never seen that.
Andrew: So how do you get past that? If you don’t have all these historical references to say, “I’m like them. I can be like them. I started like they started. I could be like them.” If you don’t have that in your family, what allowed you to do this?
Devin: So, again, I think, I come from a history of people who don’t care, right? I was blessed to be in a position of first where I don’t need to see anyone who looks like me to have permission to do it. And then recognizing that as I achieve the next set of people who do need that, like I can be that, right?
Andrew: So you’re drawing on not a background of entrepreneurs who’ve been in business and inventors who’ve been changing the world that way. But a background of people like your grandmother who said, “You don’t want me here, I don’t care. I’m going to be here because I believe that if I’m here, I’ll have a better life later. And by the way my next generation of kids and their grandkids and people who won’t even remember my name will know that I did this will be benefited by it.” And so you’re doing the same thing?
Devin: Yeah. I mean, so I think it’s both. So Edison is my favorite inventor. Like I’m obsessed with history. I named my kid Octavian. Like . . .
Andrew: What’s Octavian reference to?
Devin: Roman Emperor, Octavian.
Andrew: Oh, Octavian? Okay.
Devin: Yeah. So he was born Octavian. When we came he became Caesar Augustus. So I always say when my son does something of like great note I’ll change his name to Augustus. But, yeah, so I think, understanding . . . I don’t know if you’re familiar with a guy named Toussaint Louverture.
Andrew: Nope.
Devin: So he did something only one person in human history has done which is he led a successful slave revolt. And he did that in Saint-Domingue which is now modern day Haiti. Which is actually kind of interesting here in Chile. And so he essentially got access to reading like about the Roman legions. And he successfully built a legion in Haiti taking the British, the French who tried after they did the slave revolt to come and reclaim Haiti back. And instead he beat them and he invited their generals to be involved. And like he was one of these guys who looked at history . . .
Andrew: Wait, what did he do? Was he a slave?
Devin: He was a slave.
Andrew: He was a slave and he said, “I want to get out of slavery and I want other people get out of slavery.” He read what the Romans did about legions. So can you be more specific? What did he learned from the Romans and how did he use it?
Devin: Yeah. So Toussaint, born a slave. You know Haiti is historically a French Colony, you know, a very, very brutal form of slavery and way worse than slavery in the U.S. and the Caribbean in general. And they see an opportunity to . . . there’s a lot of the history there but there’s a revolt, right, that comes through.
And he did a couple of things that were different from most kind of slave revolts which is instead of killing the slave masters, he recognized that those are the guys you have the economic ties to the rest of the world to actually like ship the sugarcane out. And so he pardoned them and made them pay their workers a fair wage. And he kept them in place. This is one of the like very first huge differences to mostly revolts equal slaves rise up. Kill their masters.
Andrew: And?
Devin: Other people, external military comes quells revolt destruction.
Andrew: Got it. And he says, “No. We’re going to take the people who are oppressing us, who are enslaving us. We are going to work with them.” And as a result what happened?
Devin: And as a result though he got the economic relationships they had, the trade deals they had. And he kept them in place. And he was actually able to successfully establish a nation, right? Which was Santa- Domingue became a nation. Now Haiti has a very interesting like backstory in history to what happened later. But at that time like a successful slave revolt that yielded a nation is never happened in human history.
Andrew: So let me pause and come back to you. This is you finding the historical figures that you need to get to be the person that you want to be?
Devin: Yeah. So in that case I learned about Toussaint which affected me a lot but then also Edison in Korea. I lived in Korea. I went to the Edison Museum. When I saw and, you know, it’s like one of the most magical experiences I walked in . . . you know, Edison created recorded sound, right? Which we’re sitting here with video and recording. He did that on a milk crate with, you know, a piece of tin, right? I think the original stock ticker that he created was there and just looking at time of invention and understanding like the original startup stories. The startups have not been different from the time Edison was creating the light bulb till now like there was hype and all the sudden. So I find both in characters like Toussaint and Edison a lot of inspiration.
And so back to kind of today is most African Americans in the U.S. don’t have access to their history. Like from a genealogy perspective being traded as . . . you know as slaves your cargo versus kind of like the stories of your family. And I think the ability for you to know the stories of what the people did before you, to know like, you know, the professions of what people did and to demystify that is not something that naturally happens in a lot of underrepresented places. To understand like how are those paths trailed?
And so for me I’m really passionate about getting the skill going out like for me like fundraising. And we raised $2 million. And if you look at . . . you know, I think, women in 2018 get like two and a half percent of venture and like minorities got less than a quarter of a percent rate. So like I was actually a percentage of the total minority funds raised which at the time I didn’t look at the stats until after I raised. But David Cohen, because we went through Techstars, like taught me like how to raise money. And like I looked at, you know, everyone in my lineage and people now. I realized that no one ever learned how to do that, right?
And then recognizing that the truth is that anybody can learn, that it isn’t about race. And that all these things are there but you have to kind of, for a lot of people, it’s it is showing that, “I validate that that’s true.” Because if it’s true, if it was just everyone can do it, then you would see even distribution or pretty even distribution of talent, right? And in fact being reflected in positions of power. And that’s actually one of my core thesis is that talent is easily . . . is evenly distributed throughout the world but opportunity and capital is not. And there’s a lot of reasons as to why opportunity and capital are not as distributed.
Andrew: I get it. I want to touch on one other thing related to history and related to capital. We were talking before we started about Magma Partners. That’s the firm, the VC firm, that made this possible for me to come here to Chile and do interviews. I always thought that Nathan had a small amount of money in the VC fund. And it was his partner who uses family money to make investments in company like yours. That that’s where the money came from.
You and I before we started we’re starting to talk about families like . . . you said basically Nathan actually had much more money put into Magma than Andrew you expected, which was eye opening for me. It was interesting. But then you started talking to you about the family of the partner. And I know from the way you were talking about it that you’re not going to talk openly within this interview. It’s a private thing that you wouldn’t even share with me in private. But I did think it was interesting to understand how Chile works. How money in Chile works through your historical context. Can you tell me a little bit about that? What happened in the past that allowed some families have a lot of money here that now some of them are using to invest? I want to get a sense of the culture of the city that I’m in and the country I’m in.
Devin: Yeah. I mean, I think, we talked a little bit about just kind of this general phenomenon across Latin America of smaller sets of families that have kept wealth all the way back from the time that the Spanish were here.
Andrew: So here in Chile specifically.
Devin: Here in Chile specifically. But you will see this if you go to Guatemala, there are eight families. If you go to Bolivia, there are a couple of families.
Andrew: Really?
Devin: Yeah, if you go . . .
Andrew: The Spanish owned Chile until the 1800s. Am I understanding this right?
Devin: Oh, man . . .
Andrew: Spanish domination was not that long ago?
Devin: Yeah. So the Spanish were here like the 1530s. I want to say all the way until, yeah, the early 1800s. I should know more. But, yes.
Andrew: I’ll get the data in a moment if I could. While we’re talking I’m checking out Wikipedia. Okay. But . . .
Devin: Yeah. So . . .
Andrew: So then what happened? You were starting to say how when they left, they left a few families. What was that?
Devin: So the money here once it has been made tends to stay, not necessarily institutionally in just large companies. Like in the U.S. I think we have these really big and direct like Ford. I guess Ford is technically a family too but whether . . .
Andrew: General Motors is not a family, right. Yes.
Devin: We are these really endearing kind of public institutions that have held capital as well as families. But in Latin America, I think there’s a lot more families who have held wealth at a family level for a very long time. And so you have this impression of like last name, right? So literally in Santiago . . . so from Las Condes all the way . . . so this is one of the wealthiest areas. And if you just follow the red line down the metro, it gets less wealthy. Like the surnames change and . . . Like so here people will ask you where you live as just a quick way to ping you socially. Not only just like in a city where like, “What kind of neighborhood are you in?” And you kind of get this, but to know the history of your family. To know if your family owned land. If they didn’t own land. If I say the last name seen to you, you know instantly this is the history of that money. This is where it came from. This is where these kids go to school. This is where . . .
Andrew: Do they invest in companies and new companies regularly or is Magma Partners unusual in that?
Devin: It’s super unusual.
Andrew: It is. They keep to themselves in the older industries?
Devin: But it’s changing, right? And in fact the things Start-up Chile and what’s happening in Latin America in broad is that a lot of just historical very long held classism is now through entrepreneurship having this very fundamental shift, right? Initially, I’d say entrepreneurship up here in Santiago 10 years ago was funding those kids who lived in this part of the cities ideas. And now it’s opened up massively to just trying to fund the best ideas, right? And you’re having these really big shift of . . . you know, SoftBank just opened their $5 billion Latin America focused fund a couple of weeks ago.
You’re having . . . you know, Andreessen started making a lot of investments in Brazil. And you’re starting to have this influx to recognize that there’s just great talent here. And the lines of that talent don’t fall on the historical class lines. And that’s one of the biggest like cultural shifts and changes that are happening here. And now Magma has been a really big part of leading that in Latin America of just finding great companies that are focused on either the U.S. as a market with our back office in Latin America are doing really great B2B companies here.
Andrew: Yeah. I’m amazed by how helpful they’ve been to me and to the entrepreneurs who I’m asking to interview. They have done so much to help people and to stay connected to people that when they ask you to come do an interview with me you don’t have to . . .
Devin: Oh, man.
Andrew: You said, “Okay. Nathan, I’m on. What’s Andrew going to . . . Nathan, I’m on.” By the way, it was a national junta in the name of Ferdinand, heir of the deposed king was formed in September 1810 and as a result they got their independence. So 1810.
Devin: Dieciocho is a really big . . . this is a huge celebration here in Chile. It’s probably the . . .
Andrew: September 18th?
Devin: Yes. Being here in Chile on September 18th is one of the greatest experiences. It’s a lot of fun.
Andrew: I wish I was here then. But I’m glad I’m here now. It is beautiful here. Devon Meadows who’s come here with me from the Bay Area and I went just walking around here yesterday. It was so much fun. Had dinner last night. The weather’s beautiful. The environment is great. I’m looking forward to seeing it more.
Devin: Yeah. The wine, please drink so much wine here. It’s so good.
Andrew: I haven’t had any wine yet.
Devin: Oh, Chile is . . . this is Mecca.
Andrew: All right. You know what? What I did was I had whiskey and I had local beer. The local beer was okay but . . .
Devin: Yeah. Even before coming to Chile, I wasn’t that big into wine but Chile wine is super cheap. And there’s like a crazy amount to try and, you know, it’s just the best place I think to fall in love with wine.
Andrew: Right. Some I’m going to have some wine in your house just uninvited.
Devin: Okay, man. Come.
Andrew: All right. Thanks so much for being here. Thank you for doing this with me. To everyone who’s listening, the website is groupraise.com. You don’t even have like a .cl. You’re a fully international company largely in the U.S. You just happened to love it here. And this is where you’re living and growing your business.
I want to thank the two sponsors who make this interview happen the first is Top Talent. God love Top Talent for bringing developers from all over the world to you. Go check them out at . . . in fact don’t just check them out. Have a call with one of their matches, you’ll fall in love with them. That’s toptal.com/mixergy. And I want to thank the second sponsor, the hosting company that will get your hosting done right. Go to hostgator.com/mixergy.
And finally you were asking me, yes. I am going to be doing the Santiago marathon on Sunday. I’ll be running 26.2 miles. This is the first organized marathon that I’ve done in a long time when Devon and I flew to Texas. And then I ran into Mexico it was just like, “Let’s just find a road for 26.2 miles and we’ll cross the border. We’ll figure it out.” This one is fully organized. I’m looking forward to doing it. And the reason I’m saying that to you is . . .
Devin: You ran to Mexico from Texas.
Andrew: Yeah, man.
Devin: Yeah. It’s usually the other way around. But that’s awesome.
Andrew: And you know what? It was the Mexicans who told me not to go into Mexico. The Americans on the American side said fine. The Mexicans on the American side, “Are you really going to do that?” I did. We really did it. Devon put together a great video of it on YouTube. If you want to follow along as I’m traveling the world to doing interviews like this and running marathons on every continent, go to runwithandrew.com. That’s all I got.
Devin: Epic.
Andrew: Thanks again. Bye.
Devin: Of course.
Andrew: Bye, everyone.
