EP 04: 'Superman' Steve Newcomb Pt. 1 - Famous, Powerset to Bing, Building a Company Cult, Never Quit Attitude

FULL TRANSCRIPT

Discussion topics about what it takes to sacrifice everything to overcome hardships and failures to achieve success. We heard the call now it's your turn. Everybody wants to be a founder and so the people that used to be your first Engineers that didn't think they could be Founders those people now trying to be Founders myself cuz I know you got a lot more. More wealthy at the end of the day and you can own your own destiny. How do you hire great Engineers whenever engineer wants to be there. And it really goes to like I would rather have 6 months of a great engineer that I'm eventually leaves me and the comes around founder. Then have some middle of the road. That doesn't want that and isn't a great engineer and I've learned that lesson to be humble to the engineers that you talk to and say I'm thankful that you that I only have 6 months of your time. Successful entrepreneur investor and heavy hitter in the mecca of innovation Silicon Valley AKA San Francisco California. Buy some of the biggest software companies over the last 20 years he's LED Capital funding rounds of tens if not hundreds of millions of dollars to which has led many of his companies through successful Acquisitions that just power set the technology that powers the mega search engine thing we sold the Microsoft in July 2008 for a hundred million dollars. Currently the founder and CEO of famous a design software platform that allows the average Joe to cry. Mobile tablet website experiences without any code. Superior talent scout and having the ability to build high functioning teams. Experience software and simplifying business models into one platform he has grit Visions to change the world in the skills to pull it off. Is written in Scripture that upon the seven. One man to redesign Silicon Valley to the famous city that it is now by hand. Iteration at a time. Is our next guest please welcome Steve Newcomb. Way too much. Studio. Brain freeze Frenzy. Style are you ready. You can say about yourself today. Did I did today or about me to something you're proud about today your every single day and I start off as the best of times and the worst of times. I've already experienced both of those. Good morning before I ever talk to you. One of the most important things to do as a Founders to Keep On Truckin. We had an amazing moment this morning and we had a death-defying moment this morning already. And it's it's something that you know. You got to handle it and handle it. With a smile on your face do you know if death comes knocking you can just smile and that's it and when opportunity comes knocking you better answer the door and you know before I had the opportunity to talk to you guys today we've already had both of those two things happen. If you could be an inanimate object. Inanimate object. I would like to be. Yo Ma's cello. Why would that be well I'm a musician and I really appreciate you right musicianship and imagine if you were the instrument played by the greatest room cellist in the world and you got to experience him. That's an interesting perspective that's really cool jump into that I believe coming up here as well but what is your favorite place that you have traveled to. Not even everything else is even close is. We sold our set to Microsoft I took a year off and my wife and I both. Everything just to read capture who we are you know what we want to do with our lives. We lived in the French side of St Martin. Only hung out with French people and just reconnected with well alcohol for 1. Nakedness. I don't speak I barely. My wife called my version no Steve's version of French because of the stench. I am not fluent in French she went to school in France. And I would just sit there and drink and be merry beautiful worst travel experience. Boy oh boy oh boy. I think that getting to Saint Martin was tough so when we went to go to st. Maarten. We got delayed flight cancelled everything we ended up in Miami on the the South Beach row and we stayed there for a while and you know where one of those very expensive hotel rooms right on the main drag. Athletic can't dance at all. My scene and I was like a little bit anxiety. Let's just go to any Caribbean island so we went to. Which I didn't know is there's nothing on Saint Croix is the only flight available and there was a reason. We booked a room and the guys like well there's no running water in your room and the door doesn't work so the door will be open to the air and you on the first floor. And he invited me to his party that he was throwing. Hookah party. Where is horrifying room. Has made the most of it and just hook it up and health. Death-defying traveling Route 2. But once we got there is absolutely wonderful. What's your morning routine look like. I'ma extreme. Early morning Riser and I try to get up. Six 6:30 if I'm having a long day but I get up and exercise I try to run to 3 miles on an elliptical I don't go outside anymore but due to take an hour to an hour and a half of music lessons where I'm learning how to score orchestral music and film music. So I set up my music studio for better an hour and a half men exercise prior and then I come into work I write my list in my famous notebook with my you know famous pencil. And I get my wits about. And then we have our first team meeting at 9 a.m. in the morning. Organized. Why we love those super inspiring morning routine. What type of stress management do you provide for your company. Cypress Amos. We do differently so on Fridays everyone stops their projects. Friday's and everybody we just kind of car cleaning your closet so if there's tackle dad or product that are designed that or the stuff that needs to be done that's been bugging you. We put up all the little tiny little tasks up on a bulletin board. And we just do these tiny little tasks and then at the end of that day. And we have. Who sings beer tastings and then we cook for each other. The accomplishments of the week and we do that every week religiously. We left we just called demo day. Nearest this can be. Early release of stress just because you got to get these things off of your shoulders. Get drunk or high with anyone who would it be. Drunk or high. Wildly different things. I love to get drunk with Mick Jagger. Jagger that, probably be a lot of fun hanging backpack. Rite-hite. For a while I got to play on stage with some pretty cool stuff back when I was a kid we got to open up for the band who opened up for the band who opened up the band who opened up for the Red Hot Chili Peppers. Same thing for Jane's Addiction. We were not the best band. Same stage and you know. Shifting gears just a little bit. Ideas to our audience. NSA a while back after we sold powerset to my. This is lots of equivalence Ben Horowitz. And. I've had so many of those it powers that were you just in this startup moment and you feel like HBO should be filming it you know for Silicon Valley the TV show. In this. Moment cuz it's so ridiculous and you have those in startups you know we've had so many Crazy Ones out throughout my career where you just it just happens and you're like how the f is this real that I'm young living through this right now. Positive. Twinkies on a dime. Next. A positive one when we launched. Search engine into. You send it away to get your search results test to see if you could be Google in like no one had ever be Google before. Search results test back for a subset. The thing put in there to say did you do better than Google and we won 70% of the time and I absolutely I think I. Real like I did this cuz you have this I have massive imposter syndrome like when we succeed I have it and when we fail I'm like a horse I failed cuz I'm an imposter you know I just feel like. And you know it's it's a it's a battle to believe that this is real sometimes. Maybe 20,000 people to sign up and we had 200,000 people like now on a snap. Just amazing. What is people using our product. Maybe we are validation. A lot of people. All confident. The more I see the more nervous sometimes psychology behind. And secondly. Ask yourself. I think I think 10 years and talk to myself 10 years ago it's just the more you can live your life true and honest that the happier you'll be and the more you lie to yourself and like things like tell you tell yourself that you want to do things for Pride reasons. Anxiety goes through the roof. No it's sort of like what's the equation. 18 - meeting people anxiety. That is never more a true statement made and it was. Is the guy that Hotel chain. And that is just such a true payment like that's true statement just like live truthfully and you'll be happily happy and whether your startup becomes the next Facebook or your startup sells for $10 startup fails is actually weirdly irrelevant is it Tuesday to the importance of living your life truthfully. Power to say something to myself 10 years from now. Would you want to ask. I live healthily live for 200 years. Time it doesn't exist. No 5 Concord startup space. Rate what else can I conquer. Stop working and never stop concrete never stop learning. Beautiful what was the last thing that you can get your glad nobody else. Did you step in dogshit. Nobody else a new song. I've had some. I'd say one of my dues easiest was so when my wife and I got married we couldn't afford much to go on our honeymoon and we went to we went to Phoenix. And that's where the kind invented to go. They gave you. The couple's room afterwards for an hour and they just like we can't do whatever you want like indoor outdoor area. Out there and. At no clothing line whatsoever. And I'm like we're going to go and we were the last you know people of the day and they left and they locked us outside in our earlier Paddock area. We were naked and my wife is liking all your gear. Woman so you know right off the heels of our marriage she saw what must have been the worst naked move possible which is hoisting yourself over a spike wooden fence. Thailand on the other side of that fence and I kid you not they were having. A yoga class so I I land in the yoga class and I see this like Shaman monk do teaching the class and like Namaste and then I run. Try to find somebody. Cranial sacral massage. Ocean massage. The whole wedding. The guy gave me an hour and a half is not doing anything. Hit me as I'm running and I just start crying and I'm naked that's running. Something to cover myself up. By the time I get back. Comfortable. Jackie talwani crying. Oh my God. You have to go through one of them behind the first or a fire is Raging a gun man looks behind the second one and behind the third one. Or will you choose. The first one. Which door do you choose. I did the same. An interesting one because it's like a little doozy just to warm up the prefrontal cortex but that hasn't eaten in 3 years I miss that one as well myself he's dead anyway anyway. Stucco repair. I've never used the product I built. Okay. Tremendously successful career but you don't become an A-list winky shouldn't entrepreneur overnight. And anyone or anything that's helped you shape you to wear today. Like many people I'm not from. And I came here I lived in DC. And when I came here this is like. Country. I didn't know how Venture Capital work I didn't know how startups were. Startups were in like Palo Alto or Mountain View back then they weren't really in the city we had 4th Street I don't know if you remember was called silicon Gulch. Back then. For startups on 4th Street. I was desperate to know how Venture Capital works and how to raise money and coins no a startup that did very well on the.com boom but I still didn't know anything and one of the things I did early on I came up with this crazy idea to have what I call the Venture Capital Breakfast Club. Have six startups to pitch to General partners of VC. And that way I'll meet all of these seas and I'll get to see how the pitch sound ever been in a pitch in my life. And then I got. Lawyers I knew lawyers always wanted to get client so I went over to Wilson. And I want to spend where can I sell you guys sponsor this thing. Yes I was like shocked that they said yes. Breakfast coming in. Prior to ever having your own stand-up. To hear and just saying I want to learn. Entrepreneurial Spirit as a Young Man. Apologize to startups. That created cheesy music jingles and then I sold them the car dealerships and that was fun. System so that we can input resumes into fax machines which I went to school. Fax machines back in the day and so we can share resume. At the school has which means. Classic. Thompson's back down. I work in the Big Shot you know I'm right. Every Thursday I did it for two years so I got to watch that many startups pitch to that many General Partners in the law firms helped me get the Venture Capital people there. I just put a notice out you know. It exists and I'm upset. Let me know and I'll send it had like. Restart. Imposter syndrome startup. Easy to set up. What it looks like in the eyes of a venture capitalist when he thinks somebody's bullshiting them. You know I see 99% of the people that were full of s***. Real. What you would be able to signify that okay that person for the s*** or was it something that. We have to listen to the whole pitch to realize at the end of it was their key characteristics. How to find you now. Eventually what was. What day is that. When I saw MBA students from whatever name your Ivy League school pitch. BCA not excited at all I'd see them. Start immediately question passion. And that was my great surprise you know cuz I had always thought of people who get into Stanford and Harvard have a leg up on these things and every NBA kid. And the people that did well where people that came from the industry that they were trying to create something in or had been self-taught or had some sort of struggle. And that's when I realized like this this little pocket that we live in is really and truly a meritocracy and if you don't matter what your background is if you earned it if you come from it if you've seen a real tangible problem you're solving a real tangible thing these species could taste it and smell it. Cuz I was just bought. I get the Spade in this community. Started feeling like I belong cuz I was always so worried like if I didn't go to an Ivy League school I wouldn't have. Engage execution strength. What they would be able to pull off ever since what's maybe in the next life. Give me the news in this Venture Capital Breakfast Club results. Things that I noticed. Presentation at all did better. Not affected me and has affected how I present definitely people who. Fifty thousand customers misses. Have a growing at 200%. You want to talk more here's my idea or people who came in with a product and showed a prototype so that deeply affected me when we built power set the only thing we really showed was the demo of us vs Google and a blind side by side Pepsi challenge taste test that's what I presented to Peter to you all when we went petertyl funded us we didn't have a dick I just we just had an A and A B and you couldn't tell who was who. And when he did it we one I think was like 9 out of 10 times. Stop easily as a search engine I don't need to tell you the market for search engine but we just beat the pants off. When I did the did the angel round for famous we only brought it down. Actually brought a printed book I have it here at the show it to you guys. Almost like a photo book history of famous things we did every photo in it I actually we doctored up the scene that we are in to be exactly like the scene of every photo of Steve Jobs with his team in the beginning of apple and replicated every scene of their original photos of Apple didn't tell anybody. And but we presented a book in a demo for famous and I presented to demo a prototype. Initial rounds. I saw these things that you can just sense when somebody is actually real things versus. Give me money then I can build it. That's a bullshiter. Really getting a good sniffer for both. So you took what you learned in this breakfast. And eventually took that knowledge in. Expertise at that point on how to raise money and you convert it into your I guess it's a couple startups down the line but powerset can you talk us into against the starting is what what made you want to get into search engines available if you will and you know how you how you build your team and. I was I had gotten a dream job at the Stanford Research Institute I really wanted to dig my teeth in deep inside of an industry like I saw people that had succeeded in those venture-capital Breakfast Club meetings. Which is really hard to get into and we are doing voice recognition search. Learning some really cool. And learning under a guy by the name of Paul Cook who was our CEO he taken five companies public and was just amazing to learn. We had an amazing technical team that I got to learn from and my co-founder. Barney Powell was at Nasa doing voice recognition work for the space shuttle. Lorenzo was at Xerox Fuji Xerox Park doing natural language search. And we were introduced to each other by venture capital. Partner that I have met through the Venture Capital Breakfast Club years earlier and her name is larger eon. Hey I'm ready to start a startup I think. Search I know a lot about. I now know the pain I want to solve that take I took at that point I had five years under my belt really learning how to do all this stuff and Laura introduced me to Barney Barney introduced me to Lorenzo and that's how the three founders of power set got to know each other. And it's because I basically volunteered without charging a dime for five years helping DC's and sometimes was The Breakfast Club sometimes I help them due diligence. 5 years into this relationship. For larger and I wouldn't have met Barney and it wouldn't have met Lorenzo and powerset would have never existed so you got it you got to pay it forward and then and then you ask for that one favor. All comes together and not probably haven't thanked Laura well enough for what she did for me because it helped start my entire career as a start-up person when she listens to this she'll understand. Absolutely. Can you speak on your device over when you can. And how you fly with the power set which later became the mega search engine Bing. Yeah I mean so there's so much talent in today's world, I think a lot of people now know this is a meritocracy and so everybody wants to be a founder and so the people that used to be your first Engineers that didn't think they could be Founders those people now are trying to be found himself cuz I know you. More wealthy at the end of the day and you can own your own destiny. So how do you hire great Engineers whenever engineer wants to do their own founder. I would rather have 6 months of a great engineer that I'm eventually leaves me and the comes around founder. Then have some middle of the road. That doesn't want that and isn't a great engineer and I've learned that lesson to be humble to the engineers that you talk to and say I'm I'm thankful that you that I only get 6 months of your time and that if they want to leave you and found their own company then help them. Keep anyone down. Turn this like in Spades at the power set. Kind of started with this young engineer named Tom that joined us and he was started as an L2 but then group. Each year in like this little radius of the Bay Area. And it's it's kind of a strange thing to think that's how I feel that it is how I feel and I love talking to other Founders I love helping them I love learning from them and it's like this meritocracy base Community is so rarefied that we should just be thankful it but exists in the first place cuz this doesn't exist anywhere else. Do this anywhere else but right here in like this little radius of the Bay Area. Culture. Your success is growing in power. What was the feeling you got when you real. Microsoft wanted to acquire you. The word success and power set together and those two. When when we were young. In-N-Out in the throes of the the power set story I saw it as a failure. Can I still see it. The company that. Respected Google I wanted to go to search engine I wanted to build a big. What I want to do I don't want to sell companies. I want to build a big company and I want to trade my own cultural to revolutionize know how people think about companies and products. Factory sold Microsoft to Microsoft for a hundred million. VTOL to other Founders as a failure story because it was. Loc tappers hope you're enjoying part 1 with Steve Newcomb and if you're watching on YouTube We did an off-site recording in San Francisco at Steve's offices we really appreciate him hosting us up there next week we'll be launching the final part 2 and how Steve was able to take what he learned from his company's acquisition from Microsoft to building his current company famous so if you ever want to learn how to fundraise build a team culture pivot a company's direction or all of the above stay tuned for next week's episode on call to action podcast. Trading in a comment and if you don't. You want honest feedback because at the end of the day we're here to produce the best show possible for you our listeners. See you next week.