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Andrew: Before we get started, I want to introduce you to Haystack. Haystack is where you’re going to find the right web designer for your next project. So let’s take a look at it here. If we scroll through it, we can find lots of different portfolios. If there’s a company that we’re interested in, we can quickly scroll through a bunch of their work and see whether we like them or not. If we’re interested in them even more, we can click over and see their page, find out a little bit more about them, see each portfolio image in big so that we can really decide if this is the right company for us. And if we want to follow up with them, there’s their e-mail address and their website right on the bottom so we can connect directly. We can also go to the top. We can hit “save to favorites”, save it for later and then keep clicking around. If you want to narrow your search down a little bit further, you can click on the city. I used to live in Los Angeles, so we’ll experiment by clicking on Los Angeles. And we can even narrow it by budget. We can click over here and we can say $3,000-$10,000 is our budget and find companies that can do the work at that price. Of course if there’s someone we like we can click over, we can either save them to favorites or we can scroll to the bottom and get their e-mail address and contact them directly. Haystack.com, that’s where you’re going to find the right web designer for your next project. Here’s the interview.
Andrew: Hey everybody, it’s Andrew Warner, founder of Mixergy.com, home of the ambitious upstart. Today I’ve got with me one of the pioneers, one of the leaders, one of the early Internet, excuse me, software entrepreneurs, before the Internet was even out there, I’ve got Heidi Roizen with me and she and I are going to talk about how she built an early company called T/Maker, how she built one of the early spreadsheet software, and we’re going to talk about her career going through Apple and how she built relationships for Apple back in their tougher times and how she went on to become a venture capitalist. And I’m looking at my notes here… Heidi, one of the problems that I’ve got with you is there is so much in your biography. I don’t know how to introduce you properly.
Interviewee: I think that just means I’m old.
Andrew: No, it means that you’re out there and you’re part of lots of different companies. And you’re going to be able to give us a lot of information. Now, before I continue I should also say that your current project is SkinnySongs. Right?
Interviewee: Yes. That is my little passion project on the side. SkinnySongs.com.
Andrew: What is SkinnySongs? For anyone who doesn’t know it.
Interviewee: It is… it’s going to sound crazy, but it really works, it’s music that helps women achieve their weight loss and fitness goals by reminding them of why they’re doing it, motivating them and giving them something fun to listen to it on when they work out but also in the car. Driving to the gym, driving to work driving out to dinner – to remind you to stick to your plan.
Andrew: I heard some of the songs. They are about…
Interviewee: Well, you’re not my target market. You’re not my target market, so…
Andrew: But I have to do my research! I was listening… by the way, it’s good music. I was listening to it in the background as I did my research for you. There’s one song about how you saw a pair of jeans at the mall and you were going to get them.
Interviewee: Yes. That’s part of what women think about, believe it or not, is fitting back in those skinny jeans again. It was a lot of fun. It was a great project to work on. I worked with Dave Malloy out of Nashville. He’s fantastic. George Daly out of Marin. Two great music producers, because I’m not a musician myself. I just had the idea and I wrote all the lyrics, but really needed to have music that was good enough to compete with what’s on top 40 radio. Because you’re not going to listen to it if it’s crummy music, even if the message is good. I had a lot of fun doing that. It it’s up on Amazon and iTunes. I learned a lot about being a merchant on those fine institutions. And I lost 40 pounds in the process. So it worked for me.
Andrew: You’re looking great.
Interviewee: Well thank you. Thank you.
Andrew: I’m going to come back to SkinnySongs. Let’s go back in time and get your biography here. I sometimes get so excited in the beginning of the interview that I don’t think I’ve laid out clearly that you were an early pioneer. We’re going to talk about the software that your company built. You went on to become a venture capitalist. You’re sitting on boards of lots of companies. And along the way according to this Harvard Business School piece about you, you’ve just built incredible relationships. So as we go through your biography I’ll be talking to you about some of the relationships you’ve built up and how you did it. Including… and tell me if this is true… it’s Harvard, so it must be true, Bill Gates is a personal friend of yours?
Interviewee: Yeah. I actually… it’s very funny, because CNBC just ran the biography series on Bill Gates in the last couple of days and I’m getting all this e-mail from people. I didn’t know it was running, and I’m in the biography video. So I’m getting all these e-mails, both from from friends who say “oh wow, I saw you on CNBC”, and then totally random people say “you know Bill Gates, can you please send him this from me?” Like, no! One of the benefits of having started out in the technology industry really in 1979, is back then Microsoft, let’s see
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Interviewee: in ’82… ’81 when my friend, Jeff Wraits, went to Microsoft I think they had 32 people, so you know back then it was pretty easy to get to Bill, right? So you kow we were all starting out together and building our companies and competing and cooperating much as is the case of the technology industry today so a lot of fun, we’re all sort of around the same age, so it is very similar I think of what goes on today in the Valley with you know with the web companies.
Andrew: So that’s one of the things that I kept seeing as I did research about you. The reason you know people who are incredible, like Bill Gates, is because you built relationships with them before they were this incredible – back when Bill Gates was running a 35-man operation. And he’s just one example.
Interviewee: Well, they were still… They were still incredible they just weren’t very well known right?
Andrew: Right. They were… Before the spotlight was on them.
Andrew: Back when Bill Gates was able to stand in line for a movie and not get hassled by people.
Andrew: OK. It goes back to… and man I keep going back to this Harvard Business case that, that starts out by talking about how your dad got into entrepreneurship. Can you tell people what his company was and what happened with his business?
Interviewee: Sure. Absolutely. And let me give you a little bit of background on the Harvard Business School case ‘cause I always think it’s amusing that there is a Harvard Business School case. Harvard approached me a number of years ago. I think that case was written in 1999 or 2000 and they said, “We really want to have more women protagonists in our cases. We’ve heard about you know networking is so important; building a business network is so important. We’ve heard about you through other sources and we’d really like to do this.” And I said, “OK.” And they interviewed me and then they showed me the first draft and I looked at it and I said, “This is boring. It’s just common sense you know. This is just what people do.” And so it’s been interesting over the years because you know, obviously, they went back and they did some more work on it as well and I have… it’s almost like once you’ve put a structure on something then you begin to appreciate that in fact there is structure you know maybe I hadn’t seen it that way at first. So the case is really a fun thing to have out there in the world. Every week I get email from students who have the case and get online and find me through my website (either SkinnySongs or HeidiRoizen.com) and I think they email me just, in part, because they want to see if I respond, which of course I always do. So that ends up being funny.
And once in a while I’ve actually had students who are in class and emailing me and I’m responding and giving them answers which they’ve used in class. And of course I didn’t know that was going on at the time but that one was particularly funny when that happened. Anyway the case has been really fun and allows me to go… I teach it at various universities. Sometimes I do it by Skype actually so it’s been a great thing. It’s been a lot of fun to have that case and I’m surprised at its popularity but it is quite popular.
So yeah, I was born into an entrepreneurial family. My dad was an entrepreneur in the video field. He always believed in earning your own keep by doing things that were interesting to you and he wasn’t really a very good employee. He really liked to run his own show and do his own thing and work for people he enjoyed working with on things he enjoyed doing so he… I was lucky because very early on he was very supportive of my pursuing things that were interesting to me. Now he did believe I needed to make money at a very early age and my family, financially, we were not in a good financial situation and my dad started a business that went bankrupt and so we had some pretty hard times.
And I think that was… you know again the silver lining to that is I went out and started working pretty early in my life. I actually (I don’t know if this is in any of the material that you saw) but I started my first venture when I was 12 years old. I did puppet shows for children’s birthday parties and I advertised in the classifieds and I’d have to have my mom drive me to my gigs ‘cause I wasn’t old enough to drive of course. And I would show up and the moms would look at me like, “Are you one of the guests or are you…?” And I’d say, “No, you hired me to put on these puppet shows.” So by the time I was in late high school, I was doing six, eight shows a weekend and making you know a fairly significant amount of money, actually. But to this day when I have to throw a birthday party for kids I cringe. I think I’ve been to enough children’s birthday parties to last a lifetime. But the point being you know… and I know there’s research to support this that people who start early and are supported emotionally by their familes or loved ones or whatever to do entrepreneurial things tend to do more entrepreneurial things. Right? You build that muscle and you do a lot of that over time so I think it was sort of in… not only in my blood ‘cause of my parents, but then my early experience really
taught me a lot. Running your own little teeny business right as a 12 year old – ultimately 16, 18 year old – it was a fascinating thing to do even though you know giving puppet shows isn’t necessarily what you’d think is a prerequisite to running a software company.
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Andrew: How did your dad’s experience…oh. We’re getting a little bit of an echo here. Can you lower the volume on your side or is it… mine? Let’s see.
Interviewee: Is that better?
Andrew: Oh yes, it is. If you can hear me it’s great. How did your dad’s experience shape your view of entrepreneurship?
Interviewee: Well, I think there were two things watching your parent do entrepreneurial things. One is the explicit stuff they talk to you about, right? And he would tell me, “Only do things you enjoy. Only work with people you respect. If there’s a job that you don’t really want to do keep raising your prices until they make you do it…make it so that you’re happy to do just because you’re making so much money doing it.” I saw him really be a great sounding board and supporter to the entrepreneurs he worked with. I think he had some really good ideas about incorporating enjoyment and having fun with making money. That it wasn’t about making money. In fact, he never optimized for the money. He always optimized for the interesting projects and the things that he felt were good. I did see him go through hard times. I did see him… we went through bankruptcy as a family when my parents got divorced. We had some difficult times. And I think what I saw through that is he was a real survivor. He got up the next day and strapped it on and went off and did new things and built himself back up again. So I think that was also something that I think a lot of people do not jump into entrepreneurship because they’re too fearful of failure. And I think one of the things, particularly in Silicon Valley, failure is sort of like the badge of courage you wear. Right? You’ve got to go through failure to learn. And what you learn going through failure is hey, your dog still loves you and hopefully your friends still love you and it’s not so bad.
Andrew: Yeah. I love doing interviews with entrepreneurs who’ve had companies that fail because in this industry it’s okay to fail. And if it’s okay to fail you’re not running away from it. You could spend a little bit of time examining why that happened. Why the business went the way it did and learning from it and hopefully coming here on Mixergy and talking about it. All right. The other thing that was interesting to me about the early part of your career is that you worked at Tandem and you edited a newspaper, the company newspaper, and what it got you. Can you talk about that please?
Interviewee: Yeah. It was pretty interesting growing up in Silicon Valley and you know, I went to Stanford and graduated in December of ’79. And my undergrad was in creative writing and let me tell you, creative writing is not…you don’t open up the newspaper at the time and see a bunch of ads saying, “Creative Writing Major wanted.” So it was my first dose of reality as I got out of school and I needed to go earn some money and I didn’t have an engineering degree and it was rather shocking to me the difference between people who had engineering degrees and people who didn’t have engineering degrees. So I was lucky enough that at the time, Silicon Valley was really, was obviously growing and booming and the computing arena across from personal computing all the way up to you know, at the time, mini computers and all of that, mainframes, was really burgeoning and lots of money being invested. And there was this ethos in the Valley about culture and Tandem was a company with a very strong culture. The CEO, Jimmy Tribig, really great guy, really believed in culture and they had a company newspaper. Maybe this was my first brush with the importance of networking if you will. I actually don’t like that word but having built relationships and understand how to work with your friends is I heard about the job. I knew that one of my high school friends had gone to work at that company. And remember, this is pre-email, pre- everything, right? And I submitted my resume. I found out 100 people had applied for the job and I thought, “What am I going to do to get ahead of those other people?” So I called my high school friend and she told me that the hiring manager tended to come to work on Saturdays to catch up on her work and she gave me her direct line in her office. And so I phoned her on a Saturday and she picked up the phone. Pre-caller ID too. She didn’t know who it was. So I picked up the phone…she picked up the phone and I started pitching mysel
f. And that’s part of how I got that job is to recognize, hey. There’s 100 people, how am I going to distinguish myself without making a connection with this person? And figuring out how to do it on her timeframe and where she was. So it was a great job. It gave me an opportunity to observe a company that was a real high flyer. When I was joined Tandem they had not yet gone public. I was employee number 900 and something. I stayed with them for three years through the IPO, through… I think by the time I left to go to business school…
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Interviewee: I think by the time I left to go to business school, there were 5,000 employees. Because I was the editor of the company newspaper, I had access to everybody, and my job was to report on the company. And so, it was a tremendous experience for me. It also really gave me my first taste of computers as a non-technology person, how valuable a computer was. Because as an English major, I had an IBM Selectric and whiteout. If you couldn’t cover it with whiteout, you didn’t change it. As a writer, to have the freedom to go in and freely edit and use word processing was really amazing to me, so I became a real aficionado of computing power. It sounds so weird to say this, but when I went back to business school, I back went to business school because I thought, “well, everybody getting ahead has either an MBA or an engineering degree. It’s too late for me to be an engineer, but maybe I can be an MBA.” When I went to business school at Stanford, I was there 1981-1983. I was one of only three people with a personal computer. So, it’s hard for people to understand. I’m not that old, and to think that back then, here you’re going to this business school and nobody had their own computer. That was just incredibly rare. It made me very popular for study groups. But, things have really changed since then.
Andrew: Who are some of the people who you got to connect with because you were writing the paper?
Interviewee: When I was working on the paper, much of it was internal. But, I did get to connect with Jim Treybig a lot, and he became a great mentor and friend as the CEO of the company. I got to travel extensively because I was responsible for covering the entire organization, which was a global organization. I traveled extensively throughout the United States, which was something new for me. I visited two field offices a month. I went to Reston, Virginia, and I went to Pittsburgh, and I went to Miami, and I went to New Orleans. I was all over the place. So, that was a really fun thing to do as a 22-year-old just out of college, to have the license to basically pick two cities every month that I wanted to go to and go, and meet the people, and write about them. That was just terrific. That wasn’t really an opportunity for me to meet people outside of Tandem because it was an internal publication, but many of the people that I worked with there, Ann Door and Terry Garnett and Casey Branscomb and Barry Erico, I could go on, Dennis McEvoy, lots of people who in Silicon Valley went on to do amazing things, whether it was rise through the ranks at Oracle, or Cisco, or other big places, or start their own companies. A lot of the people I met at Tandem went off, and it was like spores, right? They go off and do great things elsewhere. I still maintain contacts with a tremendous number of people I met in that very first job.
Andrew: How can you stay in touch with all these people who you met throughout your career? I keep trying the latest CRM. I keep trying spreadsheets. It’s just too much. What do you use?
Interviewee: It’s hard. And in a funny way right now, in some ways it’s better because with email, and with social networking apps and all that, in some ways you can. You can certainly find people more easily that you’ve lost.
Andrew: Yes. If I need to find someone now, I can do a search in my GMail inbox and I’ll find their email and their contact if we’ve connected.
Andrew: But they don’t stay top of mind, and they’re not sorted enough, not the way that they were back when I was even using Act.
Interviewee: Yes, I agree with you. It is difficult. Part of it is that I’m based in Silicon Valley. I live in the fish pond here, and every day you go out and you see someone at the car wash. There’s sort of the random connections. I’m very good about email. I keep up on my email. I have a lot of contacts on email, and email is my preferred methodology. I’m not a texter. My kids text me, and I just struggle with that. I’m not a big phone person; not a big Skype person actually as you can tell since I gave you the wrong number for me, the wrong ID for me. I do a lot of that. I do some outbound stuff. I have an annual newsletter that I put together, a family newsletter that goes to a lot of people that I try to make funny every year. People comment on that, which is kind of fun. I’m also really good about just, I think there’s a lot of value in just small but personal bursts about things. So, if you hear somebody has a baby, send them a gift. If you go to a party and you see somebody, write them a quick note about, “gee, it was great to see you.” If somebody got a promotion. You know, just those little niceties keep a connection going even if you don’t see those people very often. It is one of the things people say to me, “how have you managed to build such a huge network?” Because I started at Tandem…
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Interviewee: Well, cause I started at Tandem when I was 22 and I’m almost 52, I’ve been doing this for 30 years! So, you do meet a lot of people and you form those relationships and another thing people ask me, especially after having read the case because the case of course makes it look like I’m very methodical about okay, who am I gonna go meet today and how and it’s really not how it happened. Really how it happened was, I was running a company, I was immersed in Silicon Valley, it was a really exciting time to be here, I’m a people person, I’m not the programmer, right my brother is the technology genius behind our company, not me, and so my job was to go out and meet people. And my job was to get to know them and do business deals with them and work with them and that’s what I did basically 24/7 for – you know I didn’t have kids until I was in my mid-30’s cause I was busy doing other stuff! So I think it just A) It came naturally to me but then I did learn some things over time. For example it’s something I talk about to students often at business school. I got very involved in the trade associations in my industries so when I was running T-maker, which was our software company, I ran for office on the board of the Software Publishers Association. And I worked on that really hard, it put me in a forum where I was dealing with the other people who ran companies much larger than mine where I had issues more than just my little company to think about, so it’s real work. I mean, when you’re on a trade association board you really do work. But the flip side of that is that you get to learn more about your industry and you get to meet people who you might not meet in the natural course of your business and they would ultimately become important to you. I think the other thing is it helps you build your own reputation as a person who’s credible, as a person who’s serious, as a person who is – and again, not to be sexist but when you’re in Silicon Valley and it’s 1985
and you’re a 25 year old woman and you’re a creative writing major and you’re running a software company, you know there are credibility issues. You do have to get out there and say, you know I know what I’m doing and I can make this company successful and so building those networks-
Andrew: … of boards, what else did you do?
Interviewee: Well, I joined the boards, I worked on the boards really hard. I went to all the industry events like conferences and comdacs [?], I didn’t hide in my room, you know? I went out and I did things and I went to the-
Andrew: How do you get the most value out of them? Because a lot of people will just walk around and get tired from all the different conversations they have but they won’t pull in any value from it.
Interviewee: Well, and I think this goes to another one of the things that I think about with respect to networking. It’s very hard to just go to an indoor party and work a room, right? I mean, when you don’t have contacts to build around the relationship, it’s very hard. So, one of the reasons why I like trade associations and I like volunteer boards and I like conferences where you’re speaking on a panel or something like that, is it gives you an opportunity to build a relationship by working on something with someone. You know I think that the flip side which is just, do you want to be my pen pal or kind of conversations, is one of the reasons I don’t like to sign up for mentoring students at Stanford. I go do a lot of work at Stanford but I found when I sign up for those mentoring programs you’re basically, it’s like pen pal. There’s really nothing there to really work on, it’s really just a way to help.
Andrew: Because they don’t have anything solid yet to help out with.
Interviewee: Well, cause there’s no context to your relationship. Right, and when you think about the people in your life with whom you have a really close relationship – I can almost guarantee that in all those cases it was built around something. You worked together, your kids are in the same school together, on a team together, you were on a team together, you know there was something. You don’t just randomly meet someone and then over time become really good friends with them.
Andrew: What they’re trying to do, I’m guessing is, stay in touch with you now and build a relationship hoping that some of your wisdom will rub off on them but more importantly that when they need you, they’ll have a relationship with you.
Andrew: But how do they do that right? The way that they’re doing that now or the way that they’re trying to is more pen pal approach. What’s a better way to do it?
Interviewee: Well, I’ll give you a good example of a good way to do it. So, for example, there are students at Stanford who take a course, there’s an undergrad class and a graduate class where they have to work on a project for a report and the project can be, for example online marketing. So they approached me and they said, we will work for you for a quarter for free, helping you navigate improving the reflections of your products on social networks. And I said, sure why not, free help, right?
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Interviewee: I really got to know a couple of those kids. Sorry, I call them kids. But, because they worked very hard, they were very creative, they taught me some stuff, and now, honest to God, for a couple of them if they asked me for a reference for a job interview, or if they ask me to help them get a job at Company XYZ, I would totally do that because they proved to me that they really had something to offer and they really did something. As opposed to the ones who were just, “let me meet with you once a quarter and have coffee and tell you about my teachers.” That just doesn’t work for me. I’m really a huge believer in finding something to work on together. It doesn’t have to be work-work. It doesn’t necessarily have to be a work thing; it can be around a hobby, a charitable function, something else the person is passionate about. And again, thanks to the beauty of the Internet and Facebook and LinkedIn, and all that, you can find a ton out about a person that you want to get to know better. You can find out all sorts of things.
Andrew: Like what? What could I find out about you online that I could connect with beyond work, beyond the companies that you’ve worked with?
Interviewee: Well, you can find out where I went to school. You can find out that I have two teenage daughters, so I’m probably interested in things related to teenagers. You can see that I’m affiliated with some non-profits like the National Center for Women in Information Technology, and Springboard, and things that help young women and entrepreneurial women get into school. There are speeches you can find that I’ve given where I talk about things that are important to me. I think it’s fairly simple to get online and find out more about a person. This is another thing that I talk a lot about when I go to these graduate schools. The homework never ends. Just because I’m of a certain age and people might know me, it doesn’t mean that you stop doing homework. For example, when I decided that I wanted to pursue these corporate governance positions, to join the board of directors of some companies, I really like that work, I did a lot of research on the companies, on the people, on the people on the boards, on what their interests are, what their affiliations were, where did they go to school, what kind of things do they do…
Andrew: At this point in your career, you’re personally doing it? You don’t have a person you can just say, “get all this together for me?”
Interviewee: No. I’m getting online, and I’m combing through, and I’m Googling their names, and I’m looking at their bios, and I’m looking at their Facebook pages, and I’m figuring it out.
Andrew: Did you find out anything interesting about the people behind TiVo before you joined up?
Interviewee: Did I find out anything interesting? Let me think about the TiVo one. First of all, in interviewing with Tom Rodgers the CEO, I knew when I looked at TiVo and I looked at what was happening at their board. They had three venture capitalists who were all Silicon Valley-based venture capitalists, and two of the three were coming off the board, so all the other board members are more media people. I knew right away that the reason they would be interested in me is because I’m filling as a Silicon Valley slot. I wanted to learn more about Tom, and about media, and about his background, and the things that he had done at NBC and CNBC. So learning about that and learning what his perspective would be, I went in and talked to people I knew who had worked at TiVo to try to understand a little bit more about the dynamic, and what were the challenges just so when I came in I could be more conversant about the company. I also read all of its public filings, which is another thing that people, I mean trust me, there’s a lot of boring boilerplate in public filings, but there’s a lot of really interesting stuff in there about what the company is doing. So when you walk into an interview with someone who’s the CEO of a company you’re not just, “hi, take me, I’m great,” you’re like, “wow, I see that you’re making more money on patent litigation than you make in revenue. That’s pretty interesting. Wow, that’s a big position to defend. How do you go about doing that?” It helped that I looked at Tom’s bio and I knew he was an attorney. You think, “well okay, somebody with a law degree running TiVo… well yeah, it makes sense because one of TiVo’s biggest asset is its patent portfolio.” That’s just an example, thinking back, saying, “hey, you know when you do the homework, you can walk in and put context around an interview.” And this is the thing I would say about any job interview, any interview, whether it’s for board member, or position, or anything. The more homework y
ou’ve done, the more you can walk in and understand what the company might be facing…
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Interviewee: …what have been its challenges? What have been its victories? You’re bringing more context to the conversation. It comes back to that word “context”. And you can walk in – and I don’t want to say you control the interview – but it is to a certain extent true that you can walk in and say, “Wow! So it looks like most of your customers come from Comcast and it looks like DirecTV has really been a problem.” I’m not…I’m just pulling…those aren’t real situations but why has that happened that way? You know, what has happened? And then you can have a conversation that is really about business and not, “Gee, so what did you do in your past five jobs?” Right? Which is the…that’s the job interview from hell we’ve all been through, right? Start with high school and work me through from there, right? Oh, God. You can read it. It’s on my bio. Read that. Let’s talk about something interesting.
Andrew: All right. Let’s acknowledge some of the people here who are watching us live and who are telling their friends to go out and watch us live. And by the way, if you are watching us please tweet out, include the word “Mixergy” and tell people to come watch us and that way I can see that you’re talking about us. Doc Dog is telling people to watch us. Lee Rosen, thank you very much for promoting us. John Eksley, thank you very much for telling people to come watch us. And there are a few others. I’ll keep looking at the tweets as you tell people to come watch us or give me your feedback. Tell me what you’re thinking. Ask any questions and I’ll do my best to ask your questions of Heidi. Heidi, you started Team Maker back in ’82. What was your vision for the company? I mean, personally what did you want to get out of that business?
Interviewee: So it’s really why do people start companies. I could say that I went on job interviews and no one wanted to hire me. That would be partially true. I could say that I got personal computing religion. And as an English major who was not – again, I’m not the technologist but I liken it to the idea that you don’t have to know how to build a car to know how to drive a car. And for me, the personal computer was this incredible device that could do so much. My brother and I obviously, we’re siblings and so he had this great skill and he’d created this great software product but he didn’t want to or… he didn’t want to start a company. He didn’t want to work on the company. He didn’t want to go sell. So we had this great union and for me, I think what I wanted was I was passionate about the product. I was passionate about spreading the personal computing to the non-technologist. And I loved the idea of being responsible for my own destiny. I think the coolest thing about being an entrepreneur – and it’s one of the downsides of having a job like the job at Tandem – after I learned how to do the job…let’s face it. You can kind of coast. You can kind of get away for a while and you know, you’ve got a newsletter to deliver once a month or twice a month and you bust your butt for the couple days that you’ve got to get the stuff done. And then you can kind of goof off and coast and involve yourself in office politics and dating or whatever the heck you’re doing. And the company does not get made or broken on your efforts. Yeah, maybe somebody reads the newsletter and feels good about it and keeps working there but it’s not like your butt’s on the line and if you don’t do your job the thing fails. So there’s a lot of adrenaline and a lot of personal satisfaction from starting a company, from starting from sheer scratch. I mean, literally, I got my personal computer and I’m sitting in my college apartment and my brother’s in Washington, D.C.
and again, pre-email, all that, we’re talking on the phone, we’re working on a manual, we’re talking about a sales strategy. You throw your one personal computer in the car and you drive up to CPM83 which was January of ’83 in Moskonie Center and you buy your little table and there you are. You’re like an evangelist, talking about your technology and how it’s going to help people and you’re meeting with individual users and they come to you and they say, “I run an avocado ranch. How can I use your software and this computer to make my avocado ranch to run better?” And you have to figure that out. And so what I loved about building a company was that you didn’t eat if you didn’t sell. Right? I remember one day where we had this distributor and I didn’t know if they were going to pay us or not. I was worried they were going to go out of business. I wasn’t sure if they were going to place this order. And it was $60,000. And the 60,000 was going to sort of be the difference between our ability to make payroll and not make payroll. And boy, when you face things like that, the lows are low but the highs are really high. And when you’re walking down a street in Paris and you see your product in the window, that’s really exciting. Right? Or Hong Kong. Although in Hong Kong it was probably counterfeited at the time. But you know, it was just really exciting. It was really exciting to build a company culture. To hire and run a company with a sense of – you know, obviously because I’m a woman I think our company was very pro-woman.
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Interviewee: We had a lot of women in the company which was unusual for a technology company. So for me I think, that while initial desire was to start a company was; I was excited about personal computers and I wanted to sell this software product ultimately growing the company became the desire to make the meaningful difference; to have the company I could be proud of; to bring more products to market. Broader and broader. And there are just so many reasons to it. It’s not any one thing. I think the thing in my whole career at T/Maker and being the CEO of that company, the highest high and, in a way the lowest low, is the buck stops with you. You can never slack off. You are the CEO. It’s your job to set the course. It’s your job to solve the problems. It’s your job to make the tough decisions. It’s your job to layoff people if you need to or fire people if you need to
Andrew: Did you get to a place where you could take a breath? Where you could look back and say we’ve got enough. That we’re now safe?
Interviewee: Never safe.
Andrew: Right up until the end when you sold you, weren’t safe there was always a shot
Interviewee: After we sold it I was safe.
Andrew: Yeah. Right up until then, but before then there was no safety. There was no moment where you could say I’ve got enough. I’ve got enough security. Enough anything.
Interviewee: Never. Never. Never. You always had your good quarters, you know. You had your big sales things. But the flip-side is, who were our competitors? We were competing, in spreadsheets we with Lotus and ultimately with Microsoft and in word processing we were competing with Microsoft. I mean, WordStar, these old companies. I mean there was always competition. We were always the smaller company and I’m really proud of our accomplishments. We did a lot. We built a company I’m proud of. We did well revenue-wise and we did well for our investors, but no you never have, never have that
Andrew: And Microsoft was an aggressive competitor. They would make it so their competitor program wouldn’t work on there operating systems, no?
Interviewee: Well they did all sorts of things, where if you had been them; then hey you would have done them too so.
Andrew: What’s it like you’re saying Bill Gates is a friend of yours
Andrew: What’s it like to be competing that dirty or that tough or that aggressively
Interviewee: I wouldn’t call it dirty. This is the funny thing. Even thought yes they competed with us and they did things that, for example I remember we were in the word processing business and we were selling this great product called Write Now for Macintosh. A great Macintosh word processor. At one time we had 25% market share on the Mac, which is of course a small market but we were a relatively fish in that market and we were selling licenses to universities, site licenses. And one of the universities called me up and said we’ve decided to go with word and I said well why are you doing that? You know our product is better, more suited, because we ran better on lower, smaller Macs and they said well because Microsoft has bundled Word and Excel and the incremental cost of word is zero. So how can you compete with zero? Well, I couldn’t compete with zero. So that’s reality. Tough. You know, I mean I don’t look at that as, again if I had products that I could have bundled together I maybe would have done that too and there were, this is the thing, I think it’s been interesting watching what people think about Microsoft and then watching now what people say about Google and it’s like the same words over again
Andrew: Or even Apple especially in the [indecipherable]
Interviewee: Yeah and I think the only thing that the justice department taught Bill Gates is there’s behavior to can have when you have when you have 20% market share that you can’t have when you have 80% market share. That I think, is the big wake up call for Microsoft and I think it’s going to be the big wake up call for Google if it isn’t already is you can do all sorts of things and everything that everybody accused Microsoft of doing, all the other companies were doing too. It’s just it’s not as effective when you only have 20% market share. When you have 80% or 90%, that’s really effective and it does, that’s why we have anti-trust laws and that’s why we have, the government gets involved that’s why those things happen
Andrew: All right let’s move on to the next step, but first again I’ve got to thank the people who are here supporting tumble design, kh patel, truman quan, burgundy in gold. A lot of people are loving this. they sending me nice tweets about you. Are you on Twitter? You’re not on Twitter, right?
Interviewee: You know what, I’m not on Twitter.
Andrew: It’s not worth your time. It’s great for me because it helps to get my audience to promote what I’m doing. But it’s really, beyond that I don’t see much value. Scott Simco, thank you. Okay so you sell the business to Deluxe Corp. Then you go and here’s the thing I still don’t get. You went, and you worked with Apple.
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Andrew: You went and you worked with Apple. Here you tell me about how much fun it is to create your own destiny as an entrepreneur. I know how much fun it is to be your own boss as an entrepreneur. How tough is it to go back and work for a bigger company? Why would you do that?
Interviewee: What was I thinking? What the heck was I thinking? Well, you know what, I’ll tell you why. First of all I had built my company from scratch. We had about 100 employees at the time. I’d hired every one of them. I’d been there for 14 years. “Team maker” was my middle name. I needed an exit strategy. I needed somewhere to go. I couldn’t just…and I was 30…however old I was at that point. Thirty-seven or so. I couldn’t just go and sit at home, right? What was I going to do? So number one I needed to go somewhere. Number two is as…when we shipped the product line Click Art for the Macintosh in 1984 we were the fifth product to ship on the Mac. When you went in the store to buy a Mac you could only buy five software products in the whole world. And we were one of those five. So in many ways my fortunes rose and fell more by decisions Apple made than Apple employees fortunes rose and fell, right? I was a long time proponent of trying to get them to come out with a low cost Macintosh because I said, “Hey. I don’t care. I need volume. I need unit volume. I don’t care how much money you make on your Macs I care about the fact that I can only sell one word processor per Mac, whether the Mac cost $1500 or $6000.” So when they recruited me to come to Apple…I liken it to Mrs. Smith Goes to Washington, right? Here I had been a huge critic of Apple. And I will say that word with all the meaning of both love and hate the company, right? I had actually when the low cost Mac finally shipped, or was ready to ship, Apple invited me to go on press tour. And I went on a six week press tour with Apple promoting the low cost Macintosh as a developer because we were so excited about finally having a Mac that was going to be affordable. So for me to go inside Mac – Apple and try and direct strategy, a strategy I’d been trying to impact from the outside for more than a decade, was really exciting. And also for me, you know, again I’m really p
roud of the work I did at Team Maker. Really proud of being a start-up CEO but it was kind of exciting to say, “Hey, I can go be a vice president with 300 employees, global responsibility” at a time when Apple was very challenged. The day I joined the company they lost $700,000,000. I remember that press release came out; like I joined, they lost all this money. I’m like, “Okay. It’s not my fault. I haven’t been here that long yet.” But you know I was there at such an interesting time and I really, again, had passion about the Macintosh and the Mac as a platform and I still…I’m talking to you on a Mac right now and I was at the Apple store yesterday. So I’m still a Mac aficionado. And so it was very exciting to go there and try and make a difference. The problem was that it was also really hard and there was –
Andrew: This is just before Steve Jobs came in. You were with Apple –
Interviewer: It was a year, it was a year before Steve came back. So I joined in January of ’96 and Apple bought ??? in December-January of ’97. So I was hired under the Mike Spindler administration, I started the same day as Gil Amelio, as it turned out, and then I left about six weeks after Steve came back. And why did I do that? It was really more personal decision. I mean, Steve is a genius. He’s a national treasure and I worked with Steve extensively back in the ‘80’s because actually a little trivia thing: our company Team Maker, when we published right now the word processor that was Steve’s…he owned that product. It was ???. He had bought the development team that created that product. And he agreed to put it out and publish it and pay them royalties and that’s part of how he negotiated that deal with them. So when ??? was in business, Team Maker, my company, was their largest revenue stream. Other than interest. Which Steve used to point out to me. He’s like, “Yeah. I make more on interest than you pay me in royalties.” So yeah, I worked with Steve.
Andrew: Actually I don’t understand that relationship. You guys…my understanding before this call was that you guys sold, or licensed to ???, software.
Interviewee: No. ??? licensed to us.
Andrew: I see.
Interviewee: So what happened is Steve bought this company. The product had been called MacAuthor. So not to get into too much ancient trivia history of the Mac, there was this product called MacRight which was bundled with the Mac. They needed a successor to MacRight and Apple was worried that no outside developer would do anything because MacRIghts bundle. Again, hard to compete with free. So they funded a project called MacAuthor which was a higher end word processor.
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Interviewee: So, what happened is Steve bought this company, the product had been called MacAuthor. So, not to get into too much ancient trivia of history of the Mac, but there was this product called MacWrite, which was bundled with the Mac. They needed a successor to MacWrite and Apple was worried that no outside developer would do anything because MacWrite is bundled. Again, it’s hard to compete with free. So, they funded a project called MacAuthor, which was a higher end word processor. It was commissioned and it was an outside team, so the team was building that, then Apple decided not to publish it.
Steve Jobs knew about MacAuthor and knew about the developers and really liked those guys and wanted them to come join NeXT. He said, “Come join NeXT.” They said, “We don’t want to join NeXT because we have this word processor.” Steve said, “I tell you what, I’ll publish it for you and I’ll pay you royalties and we’ll publish it for the Macintosh.” Well, they came and they joined NeXT, and then, you know, NeXT, at this point, has 12-13 employees. Then Steve, I’m sure things [unintelligible] up, “I don’t think NeXT first product should be a word processor for the Macintosh.” I mean, that would be a head scratcher. Right?
So, a couple of the guys that worked at NeXT had done some developing for me, and they said, “Steve, well, you know what, you need to publish it. So, why don’t you talk to Heidi and maybe you can cut a deal and she’ll do the publishing for you.” So, that’s what happened. So, we, actually, were NeXT’s licensee. We licensed it from them, and then sold it and paid Steve royalties. Then, ultimately, we bought a source code license to the product three or four years later because they just didn’t want to work on it anymore, we had our Mac following. Then we, ultimately, sold it to WordStar because they wanted a Mac word processor to go with their PC word processor.
Sorry, ancient history. I’ll be really [great] as I answered your trivia questions.
Andrew: I asked because I was curious, and I’m glad that you were willing to get into the details of it. I love details about business. I’m now worried a little bit about the time. Let’s tell you what, you spent about eight years as a venture capitalist, we could dig into that maybe on a future conversation, let’s get forward to now. You go after that and you create Skinny Songs, SkinnySongs.com, you described it a little bit. Why? What’s the goal there?
Interviewee: Personal passion. Again, it was something I was struggling with. I’ve gained a lot of weight during the dot-com bust, it wasn’t [unintelligible]
Andrew: Beyond that, I mean, you could have just done this for yourself. You could have created your own music and listen to it if you want to lose weight yourself. Did you see a big market opportunity here?
Interviewee: I didn’t know! You know what, I honestly didn’t know and it’s part of the reason why I funded it myself. I didn’t go after investors, I didn’t want to make it into a big product thing, I didn’t want to become the product. I just saw it and I thought, “Music has always motivated me.” I went out to look for this kind of music, it didn’t exist, and I thought, “This is a cool idea. If I can talk other people into doing it with me and we can do it, it’s a great creative thing.” There is nothing more motivated to get somebody to lose weight than to have to stand up and represent a product that’s supposed to help you lose weight. Right? You can’t go on “Martha Stewart Show” and hold the CD up and say, “Well, it didn’t work for me, but buy this CD.”
So, it was personally motivating, it was a fun creative challenge, back to my Creative Writing major routes. Right? All of a sudden, I was a lyricist, I was writing lyrics. I was writing lyrics with David Malloy who was composing, and I talked David into doing this with me. The first time I’ve talked to him, I pitched to him on the phone and he said, “OK, you’re a venture capitalist, you live in Silicon Valley, I don’t even know what a venture capitalist do. You’re not in the music industry, you don’t sing, you don’t play an instrument, and you’ve got this idea you want to write music for [fat chips].”
I said, “No, no! I want to write motivational music, you know, just like Gloria Gaynor’s “I Will Survive,” but it’s like “I Will Survive” without eating those chocolate chip cookies.” So, he said, “I don’t know, it’s a crazy idea, but send me some lyrics.” So, I sent him the lyrics to that song you’ve brought up, “Skinny Jeans.” He called me the next day, and he said, “I don’t know, this seems so crazy to me, but my wife said I have to do this, this is great idea.”
So, I got to work with David and David, you know, he produces Reva McIntyre and Kenny Loggins and, you know, ton of great people. He’s had, I think, 40 number one singles as a producer and he’s had five Grammy nominations as a songwriter. He went from thinking I was nuts to saying this was the most fun project he’s ever worked on and some of the best works he’s ever done. Because I’m not an artist, because I came in and I just said, “Look, I need the music to feel as good as when I listen to Carrie Underwood or Pink or Rascal Flatts.” You know, that’s the kind of stuff I listened to. I wanted to have that feel, I wanted to have this message. But within that context, just make it sound good.
So, he and I developed this great working relationship and it was really fun to do something new and creative. But that’s not my career. I mean, I think that part of what I learned is this was a really fun project to do. I’m really glad I did it, I’m really proud of it, I get fan mail. It’s a profitable company because we don’t pay the CEO. So, you know, the company is profitable, I’ve sold about 10,000 copies of the CD. So, you know, as an indi label, I’m a big success, but you’re never going to make a living doing something like that.
So, that for me, it gave me a really great creative outlet, but then I said, “You know what I really miss is working with teams of people to make something great happen.” That’s why I was drawn to doing things like joining the board of TiVo and joining the board of Yellow Pages. It gives me the opportunity to work with people and make something happen, but not do it as a full time job anymore. At this point of my life, it’s kind of nice to be at home and see my teenage kids and all that kind of stuff.
Andrew: You mentioned earlier that you learned a lot about selling online through this project. Can you tell us a little about what you learned about working with sites like Amazon, about selling on your own site?
Interviewee: Well, I tell you, there’s nothing like being a sole proprietor-entrepreneur and having to navigate some of that stuff. I mean, anyone who has tried to go on and buy Google AdWords and figure out what your actual value is, I mean, I’m convinced that the data is [unintelligible]. You can’t figure out that if you’re paying $5 per click and your product only sells for $10, that’s probably not going to be a workable model.
So, Amazon, as well, navigating Amazon and figuring out how to put promotions together, and I figured out that we don’t even have enough time to go into it.
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Interviewee: …that’s why I, I was drawn to things like joining the board of Tivo and joining the board of Yellow Pages, um, because it gives me the opportunity to work with people and make something happen, but not do it as a full-time job anymore. Which, at this point in my life, it’s kind of nice to be at home and see my teenage kids and all that kind of stuff.
Andrew: You mentioned earlier that you learned a lot about selling online through this project. Can you tell us a little bit about what you learned about working with sites like Amazon about selling on your own site?
Interviewee: Well, I’ll tell you there’s nothing like being a sole proprietor entrepreneur and having to navigate some of that stuff. I mean, they, they, anyone who has tried to go on and buy Google ad wares and figure out what your actual value is, I mean, I’m convinced that the data is opuscated so you can’t figure out that if you’re paying $5 per, you know, per click and your product only sells for 10, that’s probably not going to be a workable model. So, Amazon as well, navigating Amazon and figuring out how to put promotions together and, and… I figured out this, I won’t even, we don’t have enough time to go into it… but I figured out some interesting things that because I’m in the software business I could tell that they were using some algorithms to determine when a product got popular how to move it internal to their organization and, and then it would… this stuff kind of screwed me up. I could really watch the relationship between PR and, and sales, which I think is fascinating about being online business. Right, when I was on the “Martha Stewart Show” and it airs in a different timeslot across the country, it was like a tsunami of orders that came across. And on iTunes you can only see it the next day but on Amazon you can literally go on and see what got ordered in the last hour. And I could see this wave come across the country and the two times she ran reruns I could see the wave come across the country. So I really also got to develop an appreciation for what kind of PR moves consumer products, right. So, so it really, I mean, it all sounds like I didn’t think there was going to be a relationship between doing skinny songs and being of value to somebody like Yellow Pages in Canada, but, you know, Yellow Pages in Canada did 1.6 billion in revenue last year and does business with 40% of the businesses in Canada, and a lot of them are sole proprietors that are struggling around on Google ad wares, trying to figure out how to buy, you know, pizza in their
local town. And, so my own experience actually makes it so that I can be helpful in that context.
Andrew: I was on “Good Morning America” for one of my sites and, like you say, instantly you get a flood of traffic to your site, and it was quality traffic. It was people who trusted the site because of where they saw me and who introduced them to me. I got there because I had a PR agency that got me on television and newspapers. How did you get on Martha Stewart, same thing?
Interviewee: Well, no. I actually… so I did have a great PR agency that I worked with, actually two- one called 15 Minutes, which I think is a great name for a PR agency…
Andrew: I did an interview with their founder, yes.
Interviewee: Oh, great. Yea, he’s a great guy, Howard. And the other one, Kelly Fungelman [?] group, Mikey Kelly. And they were terrific. They each had their niche and they did a real good job, and, like, Mikey got me on CNN. CNN is huge. I got myself on the “Martha Stewart Show” because I had met Martha in the past through Charles Simoni. And so I just emailed Charles and I said, “I have this product and I think it would be a great fit for Martha.” And I had been… “CBS Early Morning” had read about me in ‘USA Today,’ which 15 Minutes got me that interview, and they called me and said, “Would you like to be on ‘CBS Early Morning’?” And then I knew I was going to be in New York, and so I got through to Martha and I said “Hey, I’m gonna be in New York.” It’s not like Martha and I ever hang or anything, but she knows who I am. And I said, “I’ve got this product.” I Fedexed it out to her, and she said “Hey, I’ve got a slot on my show that week, too, you want to… I’ll move somebody who’s local to Thursday so you can come in and be on the show.” And so that’s how I got on Martha Stewart.
Andrew: That’s great.
Interviewee: It was fun.
Andrew: I’m looking at… [gets interrupted]
Interviewee: It’s on YouTube! You can watch it on YouTube! [laughs]
Andrew: You can watch it, I think, if you go to your website. You have rosen.com, right?
Interviewee: I have www.heidiroyson.com [sp] is my website.
Andrew: Okay, heidiroyson.com is… [Andrew and Interviewee mumble over each other] …Heidi dot Royson…
Interviewee: Yes, that’s my family. You can read about my brothers and my nephew there, too.
Andrew: …and I will just link directly to your site, and there’s a link from there to the Martha Stewart episode that you were on?
Interviewee: Yeah, I think it was on that one or definitely on skinny songs there’s a link.
Andrew: Alright, I’ve got a lot of notes here that I didn’t get to but there’s one that I wanted- I’ll let go of most of them- there’s one on here that I’ve got to ask you about. Dinner’s at your house, you’re just making basic spaghetti to invite people over and get to know them?
Interviewee: Yes. The quality of the food is not the… Haven’t you ever been to a party where the food was really good and it was just the most boring party? And then haven’t… don’t you remember some of the best nights and it’s just a couple bottles of wine and dominoes? Right? So, now, I don’t go quite so… Well, I do actually serve dominoes on occasion.
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Interviewee: It’s not about the food; it’s about the quality of…
Andrew: I’m always intimidated to do that. Olivia will maybe make something simple, and then I’ll go out and go buy extra, and more, and have more stuff delivered still, just to make sure that there’s enough, and that there’s enough variety, and that everyone’s going to love it, and it’s all perfect. I can’t do it when it’s my turn to do it. You’re saying, “get over it, Andrew.”
Interviewee: Get over it, Andrew.
Andrew: Keep it simple and have people over…
Interviewee: It’s simple! It’s not about the food.
Andrew: If I invite you over, Heidi… you and I are in different countries right now, but if I invite Heidi over with her husband and a couple of other bigwigs in the software industry, and you come to my house and I serve you Domino’s and wine, you’re still going to like me?
Interviewee: You bet. Actually, because I had to lose a lot of weight, I’m not so keen on Domino’s. But, I’m perfectly happy to eat a salad and a piece of chicken or something. I don’t care. I’ll even bring my own food.
Andrew: Wow. If you’re ever in Buenos Aires, come on down here.
Interviewee: Okay, all right. Thank you.
Andrew: We’ll have some salad and wine for you.
Interviewee: They have great wine down there.
Andrew: Yeah, we do. All right, wine and steak, but we’ll keep you with salad. Thank you for doing this interview with me. I’m really grateful for you coming on Mixergy and spending all this time.
Interviewee: Well, it was a pleasure.
Andrew: Everyone who’s watching us, thank you all for watching. I’m looking forward to your feedback. We’ve got tons of different ways for you to connect now with Heidi. We’ve given you little pieces of advice for how you could connect with her, but we haven’t given you the exact way to do it. Figure it out, listen back, connect with her, and more importantly, connect with other people and build those relationships and then come back here afterwards and let me know how it goes.
Andrew: Heidi, thank you. Thank you all, and I’ll see you in the comments.