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This is your destination for feeling empowered in building your business.
These are the real, raw stories of entrepreneurs and business owners who have built their businesses through the messy middle of $1-20 Million, hosted by serial entrepreneur Matt Tait.
Matt knows what it’s like to scale past the first million, and on this show he’ll be bringing on other serial entrepreneurs and business owners who have been there, done that (or, are currently in it) to share what’s worked, what hasn’t, and what’s next.
Brian Powers [00:00:00]:
The tech startup is obsessed with the word scale, right? The key to scaling anything in a business is just finding veins of repeatability and then figuring out how you repeat the things that are working and eliminate the things that aren't. Then started applying that to other parts of the business as well.
Matt Tait [00:00:17]:
I'm Matt Tait, founder of Decimal and fellow entrepreneur. Yes, I'm one of the crazy ones. I've chosen time and time again to hustle my way through that first million. Now I'm scaling to the next 50. So I know firsthand what the messy middle is really like. And I know that entrepreneurs and leaders like us need a destination for empowerment, community and encouragement. This is our place. This is After the First Million.
Matt Tait [00:00:47]:
Welcome to After the First Million. I have to say today I am really excited to introduce everybody to Brian Powers, a recovering attorney, former CEO of PactSafe, and I would say the CEO of one of the, if not the largest, tech acquisitions in the midwest, post pandemic. And I also have to say, I'm really jealous. I make the joke about being a recovering attorney, but he's way better at it than I am. So with that, Brian, welcome.
Brian Powers [00:01:18]:
Thanks, Matt. You're pretty close. I'd say. Most other attorneys would share the mv for both of us, for being how far we progress into our journey being a recovering attorney. So don't sell yourself too short.
Matt Tait [00:01:32]:
I don't know. How long did it take you of practicing law to start dreaming about being a recovering attorney, though?
Brian Powers [00:01:38]:
Not long. I started in a big firm. It was there for about five years and took about a year before I was like, I don't think this is for me. I was just too entrepreneurial. And big law firms are not entrepreneurial places. Maybe they are now, but that was 1516 years ago. So very quickly I figured that out, and I got lucky because they forced my hand. I lost the job that I had in the big firm and got forced to go out and start my own thing, and that was a solo law practice.
Brian Powers [00:02:09]:
But then that all turned into PactSafe, so they forced my hand. But I was a short timer of big law. There's just no way I would have made it.
Matt Tait [00:02:17]:
You know, I was, too. And what I'm interested in is a lot of the people that we knew growing up in the legal profession, even in law school, they just don't have that entrepreneurial spirit. They don't have what it takes or even really the desire to do that. And one of the questions that I ask people when we start, and I'm interested in your answer here is, as you know, now starting and running your own business, you've got to be slightly crazy to do it. When did you really know you were one of the crazy ones?
Brian Powers [00:02:49]:
It started before I was a lawyer. I had a tech startup back in the first dot boom in 1998. It was an Internet recruiting thing. And at the time I was actually in engineering school because I was an engineer before the whole law thing came. I gave that a whirl. It failed pretty spectacularly.
Matt Tait [00:03:06]:
What do you mean by that?
Brian Powers [00:03:07]:
I mean we went out of business, we raised money, and then I, the market completely crashed, and the business was at a point where we had to raise more money, and it was impossible to raise money at that time. I mean, it was during that huge.com boom in 2001. So it just, it went away like we folded, it liquidated what few assets there were and said goodbye. And then I went to law school. But it became pretty obvious when I was practicing law and was not really given the ability to exercise my own discretion on how to practice, how to find clients, how to understand the business side of law. That's where I knew that I was a short timer there. Right. A lot of people, I think, go into professions like that and they're like, they're happy to just bill hours and do some business development and just work, and that's fine.
Brian Powers [00:03:52]:
To me, the more interesting thing was chasing the deal, getting the customers, getting the clients, figuring out how to keep them, all that stuff, all the stuff that you think about when you're in business. And that clicked for me, where I don't think it clicks for a lot of people that become lawyers, doctors, etcetera, they just, they love their trade and they want to be the best at it and just go at it. That wasn't me.
Matt Tait [00:04:14]:
Although I don't know about you, but I can't tell you how many times I'll go out to dinner with friends of ours who are doctors or lawyers or wealth managers, and inevitably somebody will say, you know what? I should be an entrepreneur. I would be great at it. I'm awesome at this stuff. And they just kind of look at me and I'm like, sure, I think that'd be great. To be fair, if you had the balls to do it, you would have done it.
Brian Powers [00:04:36]:
A lot of people say it, but very few have the balls to do it, and very, even fewer have the balls to see it through, you know? Yeah, I think that's what prevents most people from actually doing it. Right. It's a big leap, and you got to be a little bit crazy to do it, and you got to just have this unwavering belief that you're going to be able to do it. And if you don't have that, if you only have a little bit of it, you might be able to start something, but you won't be able to finish it.
Matt Tait [00:05:00]:
Yeah. And why do you say that? Do you say that just because it's hard or because you end up with some self doubt and it's hard, or, like, what makes you say that? Because I completely agree.
Brian Powers [00:05:11]:
It's just not easy. Right. Like, at least in my experience, and I represented lots of entrepreneurs, and I advise lots of entrepreneurs still. And so I've been involved with hundreds, maybe thousands of startup businesses and seen it all, not just my own. And invariably, you're presented daily with information, data, examples that say that you ain't gonna make it, and your mind and your body interpret it that way because it's so damn hard. And then, you know, it's two steps forward, four steps back, blah, blah, blah, blah. And that that wears on a lot of people. I think if you don't have that unwavering belief that you're going to be able to get through it.
Brian Powers [00:05:47]:
It can't just be, you know, advisors or other people telling you, because everybody's going to tell you that if they've been there and done it. Right, right. Just, like, weather the storm, but you got to have a little bit of crazy and a little bit of like, hey, I'm not going to stop. I'm going to make this work. More people can get to that point to start something. I think a lot less people can get to the point, like, use that over and over and over again to keep going because it just, it never gets easier. The problems just change, get bigger.
Matt Tait [00:06:17]:
I always joke that everybody's got a dumpster fire. It's just a matter of what door you open at what time.
Brian Powers [00:06:22]:
Always. Always.
Matt Tait [00:06:24]:
So let's go back to your story, because you have a fascinating journey towards tech entrepreneurship. You were at a bigger firm, that firm got merged in or bought, and you ended up going out on your own, and you started what was a successful solo practice. Talk about that really quickly. And then I want to get into how that evolved into your retirement today as a swim club daddy.
Brian Powers [00:06:51]:
Yeah. So when I lost my job at the big firm, it was 2008 and there were no jobs out there, and I was still young, had a one and a half year old, and actually had another baby on the way, so was not quite really in the mindset to go out and start something that was born out of necessity, because after nine months, I couldn't find a job. So I just threw a shingle out and started my own practice, and I did it. I learned a lot in that experience, because the way I opened the practice was very counterintuitive to the way people were practicing law at the time. I had a laptop, a monitor, an email account, a Google voice line, and I started blogging. Right? And I started generating business online, which lawyers at the time were like, nope, you gotta join a board. You gotta be involved with this nonprofit, get the network in the community. And yeah, I did that stuff.
Brian Powers [00:07:41]:
But by virtue of the way I was attracting business, I started getting a lot of tech startup business. For a short period of time. I was one of two or three lawyers in Indianapolis that really specialized on the growing tech scene, and I got a lot of that business. And then I started getting tech startups from all around the world and maintained a solo practice. Did everything fixed fee. I mean, it was like the best lifestyle business you can imagine. I had a system in place. I wasn't working that much.
Brian Powers [00:08:07]:
I was making great money. Took Fridays off like it was awesome. But it also was what opened my eyes up to the problem that I ended up solving with PactSafe. Convinced me to take a pretty crazy leap and get away from that awesome lifestyle business into the dredges of starting a very difficult business to grow.
Matt Tait [00:08:27]:
So talk about that, because one of the things that I think was also slightly counterintuitive that you did, and I think it's a great idea, you worked two jobs for a period of time, for three years, I think, before really jumping in all the way. You found a problem set. You decided to build a solution to that problem. Talk a little bit about the decision of starting what was a side hustle and then how it evolved into, like, a real big business.
Brian Powers [00:08:59]:
Yeah. So when the idea came along and just the idea was clickwrap agreements, right? And those are the types of agreements that everybody's. You check a box, you click a button online when you install an app or you buy something, say, I accept your terms, I accept your privacy policy, et cetera, et cetera. The idea around PactSafe was a product, an API that would plug in behind the scenes and turn those into real binding contracts. It does a lot more than that, but that's basically what it did. It turned a checkbox into something like the docusign esignature. My lens of the problem was through my clients, which were small tech companies. I think the largest tech company I have was probably 20 million.
Brian Powers [00:09:36]:
There were no huge companies. I was going to try to solve this problem for them with this very simple developer tool that would plug in, have a very simple dashboard. And so I started working on it. I tried to build a version of it myself. That just made my computer smoke. It was not good. So I hired an engineer and a designer to help me build it on the side. And it was just going to be something, $10 a month.
Brian Powers [00:09:59]:
Hey, let's have fun with it. I'm not going to stop working as a lawyer. The law practice going too well. And that went okay. I mean, we had a few customers. I was bootstrapping it. Only expenses were aws, development costs, and, like, what very little marketing that I was doing. And I'm talking about like $50 a month in marketing.
Brian Powers [00:10:17]:
But what I didn't know is how big the problem was that I was trying to solve. And I had a huge lead come in from a big company. I was shocked that they hadn't already solved this problem because I had mistakenly figured that, okay, well, the big guys already have something in place. They must have something in place for this. I sent out a proposal for like $250,000 a year to this company. I didn't win it. It was terrifying at the time to send something like that out, but they didn't shut the door on me and they said, okay, tell us more. And so I validated the idea with a couple of friends of mine that were in house counsel at big companies at Angie's List and Amazon, and they're like, holy shit, you're trying to solve this problem.
Brian Powers [00:10:56]:
Like, oh, let me tell you this horror story. Let me tell you this horror story where this has bitten us and me and the company in the ass. And so at that moment, I had to make a decision like, okay, do, do I go after this with everything I've got, or do I not? And I did. That was a hard process because I had to transition out of my law practice. That takes a while. Had to find some people that actually knew what they were doing with the software product like this that potentially was going to track billions of clicks a day. Had to figure out how to raise some money. Most difficulty had to convince my wife she was going to continue working and we were going to sink our lake house fund into funding more of this strange idea I had that I couldn't really explain to anybody at the time.
Matt Tait [00:11:40]:
One of the things you mentioned leaving the law firm and starting your own practice was you had one kid, one on the way. You were kind of at what a lot of people would call a risky point in their lives. And then a couple of years later, you have to go to your wife. And I assume she probably knew what was going on. Like, this wasn't a, like, oh, shit. Moment for her. But how did that conversation go with you guys of, hey, we have this great lifestyle business. I'm not really working all that hard.
Matt Tait [00:12:09]:
I'm really going to be insane and try this tech company? And I probably also don't know what all that really means yet, nor do you.
Brian Powers [00:12:16]:
It was easier than it should have been, because she just trusted that I was doing the right thing. I'm lucky in that sense, but in my mind, I was pretty nervous to have the discussion. But she was just like, okay, if you think this is gonna work, let's do it. So it was one of those things where you make it out in your head to be like, holy shit, am I gonna make it through this little conversation? And it was way too easy. She made it way too easy. God bless her.
Matt Tait [00:12:43]:
That's awesome. I mean, in so many ways, you transitioned into something that is wildly different from practicing law, and you had to go out, and you'd raised money before, so raising money was something that you fundamentally at least had some idea how to do. And you worked with enough tech companies, I assume, that you were able to network through that. But talk about right after raising that money, because you'd started one company and selling your legal services, which is totally different than selling something. Nobody has any idea what to do. The whole process of like that is inexplicable to people who have never done it.
Brian Powers [00:13:27]:
Yeah, they couldn't be more different. I mean, selling legal services was actually quite simple, right? Like, most people found me, they had a problem. I could very easily tell them how I was going to solve it and how much it was going to cost, and that was it. Like, I think I probably had a 99.9% conversion rate on potential clients to clients when I was practicing law and then starting the business. Raising money was never that difficult just because I had a good network. We only did two rounds, but it just. It wasn't that difficult for us to do. I think the transition from selling legal services to selling software is hard enough because you can't just bang your fist and say, this is what I'm going to do for you, and this is how much it's going to cost.
Brian Powers [00:14:09]:
And they're going to say, okay, where can I send the retainer. I had no idea what it was like selling software, especially at the enterprise level, that there were so many different parties and lawyers who we sold to primarily don't know how to buy technology. They don't know how to use technology, they don't want to buy technology, and they typically don't have any budget for technology. So we had to figure out all sorts of weird stuff there. Right. But that's no different than every other software product. What made ours, I think, even more challenging is there was no product on the market anywhere in the world that did what our product did. And that was because the problem was very nuanced.
Brian Powers [00:14:46]:
Right. You're solving a problem that maybe they knew they had, but they had no idea there was something they could buy to solve it. And a lot of times, even if they knew they had the problem, right, they didn't know all the different ways a problem was affecting them. And then we had no inbound interest at all. We would run Google Ads for the first two or three years and it was pointless. Nobody was looking for it. Every once in a while, somebody would come in and look for it. The first big customer we had like that was Tivo, and they were looking for what we sold.
Brian Powers [00:15:16]:
We closed that deal super fast, but that never happened. So we essentially were trying to create a new category of software. And theres a lot of market education, a lot of analyzing generally in your marketing materials, but also inside of a sales process, youre educating your buyer on the problem they have. It was hard. So that was like a double whammy of a learning curve for me to try to figure out just how to sell software because I was so bad at it at first, I would just go on to pitches and I would just talk, I wouldn't listen, I wouldn't ask questions. No discovery. I'm like, what? That, that's stupid. I'm just going to tell them what they need and they're going to buy it.
Brian Powers [00:15:54]:
That, you know, that doesn't work. And then layered on top of that, the category stuff, it was, it was hard.
Matt Tait [00:16:03]:
Did you ever during that time get worried or did you always have enough to keep you going?
Brian Powers [00:16:09]:
If there was ever one thing that did worry me through the whole process, it was, are we going to figure out how to sell this? Because the product roadmap was very simple. We couldn't do a ton of customer discovery to figure out what the roadmap should be. Initially, because we were inventing this product out of thin air. So the product roadmap was born out of what I was extracting out of case law and said this is the things you need to do to make a binding contract out of this. It wasn't that hard, right, very nuanced thing that not many people thought about. But that part of it was pretty simple. The thing that worried me if anything ever did was, are we actually going to figure out how to sell this and are we going to be able to create enough market demand that eventually people will come to us? And thats kind of a two step of a very daunting thing to think about when youve sunk your savings, your entire life into one piece of software that you want to take to the world. So yeah, the second part of that, which still hasn't really come to fruition, generating enough education and demand in the world so that more and more people come to you and want it.
Brian Powers [00:17:12]:
Now, obviously that's changed a lot over the past twelve years, but that one, if anything came close to keeping me up at night, it was that, well.
Matt Tait [00:17:20]:
You got there enough. I mean, knowing the end of this story, you reached a good product market fit at some point. And then that's like one of those congratulating yourself after the first lap of a four lap race. The next lap becomes like, hey, now we get a scale and you as a lawyer are not taught anything about that. Law firms don't scale well. Like they are literally the worst example of how to scale companies. And then you had your solo firm, now you are exiting startup phase. Talk about how you kind of went into that messy middle of scaling and what that was like.
Brian Powers [00:18:03]:
Yeah, the tech startup blogosphere is obsessed with the word scale, right? You're a thousand blog posts about scale this, let's scale together, blah, blah, blah, SAS scale. So you know, I got sucked into some of that. We got lucky that we had a couple of our series A investors that I think this is. Anytime you're raising money you want to have the right partners. And we had pretty good partners early on. That really helped me understand that the key to any scaling anything in a business is just finding veins of repeatability and then figuring out how you repeat the things that are working and eliminate the things that aren't.
Matt Tait [00:18:38]:
Sounds so simple.
Brian Powers [00:18:41]:
It's not simple at all, but it's a simple way to think about it. And anytime I would get confused about what we should do next or how we should scale things, I would always try to reel myself in and reel the team back in and say, look, there's something we're doing right. We just don't know enough about it. There are things that we're doing wrong that we're going to continue to do wrong unless we really figure them out and eliminate them or start to eliminate them. So let's really understand the things that we're doing right. Like in the first place, we applied that, as any startup should, is in their sales and marketing funnel. How are we getting leads? How are we converting leads? What are the things that are helping us sell? And then the larger the data set gets right, you start to be able to understand these little veins of repeatability that you can start to expand, then started applying that to other parts of the business as well. I think any scaling exercise has to start with that.
Brian Powers [00:19:34]:
Whether it's the operational underbelly of the business, whether it's customer retention, whether it's sales, whether it's marketing, you're doing something there and there's always going to be things that you have to add to or even people right. Even retaining people, like what's the common thread and the best people that we've hired and the people that are staying. Right. Like how do we do more of that? So there was always a very clarifying and refreshing thing to pull back and just think about it like that. Like we're going to find something that we can repeat. And the more things we can find that we can repeat, the more likely that we're going to scale with some success. Again, like you said, not as easy as it sounds, but if you take that simple mindset, it was very, very helpful and clarifying to me. It's easy to get lost in so much minutiae.
Matt Tait [00:20:19]:
Well, but I think that's a really great way to put it, and it's a good lesson from your story, is finding simple ways to define complex problems. Part of that's even baked into your sales strategy for PactSafe is you have a very nuanced, complex problem set. And so much of a successful go to market is figuring out the simple explanation for the complex thing.
Brian Powers [00:20:47]:
Exactly. I mean, that was hard for us too, right? I can explain it a hell of a lot more coherently now than I could two or three years in. Hell, even five years in. And you think back and mean, it took a lot of practice, a lot of reps. But again, it was observing what words are we using that are making sense and then doing more of that, making sure those words and that line of reasoning showed up and the way we pitch and our materials on the front of the website and this content, that content. But yeah, it's a lot of repetition and a lot of mistakes, but eventually we figured out enough things to repeat.
Matt Tait [00:21:23]:
You know, one of the things that I've always found that successful companies during that kind of scale up growth phase, that messy middle, the really successful ones figure out, is finding the right people to help you grow. And oftentimes, for people like me, finding a lot people that are a lot smarter than I am, talk about that process, because I know that you also, one of your earliest hires was somebody that stuck with you through the entire process, that you knew for years ahead of time. But talk about how you were able to find and add people around you to help the company be better than you could make it alone.
Brian Powers [00:22:06]:
You keyed on something very important, like hiring people that are smarter than you, and if they're not smarter than you, that makes sure they have a lot more experience or more experience, and they're better at what you're asking them to do than you are. If you can do that, you're going to do pretty well in hiring. And I was lucky that that was very obvious to me, the first hire that I made, because I made that hire, the two first hires I made, who eventually ended up becoming my co founders after they came on, was Eric Prue and Adam Gillespie. And I knew I needed somebody that knew a hell of a lot more about software and building a roadmap and selling and all that stuff, right? And so these guys came from exact target that was acquired by Salesforce, and they were both very, very highly regarded in there. In fact, when I first hired Eric, people in Indy were like, how the hell did you get Eric? True. I didn't tell them. I was just like, I was very persuasive. They didn't know that I'd known Eric for ten years.
Brian Powers [00:23:00]:
I was a swim coach, and we were like best friends. So I took all the credit for it, that I was just a very persuasive recruiter. And then Eric brought on Adam. But I knew what I didn't know at that point, and not that those guys knew everything either, but they had been through it. And so I immediately had people in there that I could trust to help me get to a point with the business where, you know, we had a product that was reliable, that worked. So it was good to start from that point of view. I always knew from day one. Cause I had never been in a hiring position before the first startup.
Brian Powers [00:23:31]:
We didn't have many people, and there were only a few of us, and that was a kid back then. So that became a recurring theme throughout anybody that we hired at PactSafe. It was like, especially people that I was hiring. If I'm hiring somebody for a sales role, I'm going to expect them not to know more about selling PactSafe or more about our product or our target audience or market, but more about just selling software in general. So always tried to do that. And even with doing that, I made a ton of mistakes. They made a lot of poor hiring decisions that were my fault, not the people that we hired, you know, and I think that's pretty common, especially in sales.
Matt Tait [00:24:06]:
What do you mean by that? Did you not set them up for success? Did you not find the right people? Like, what about that?
Brian Powers [00:24:14]:
A couple of things. One, definitely not setting them up for success, but that was more of a product of me not knowing how to set them up for success. I think there's a tendency in every startup founder to try to find somebody who's going to own the sales part. We all want to hand it off earlier than we should. And I was like, hey, I'm going to hire a good sales guy, saleswoman. And man, they're just going to go crush it. And that didn't happen. And I kept making that mistake until finally figured out, okay, nobody's going to be a sales leader here until we figure some stuff out.
Brian Powers [00:24:48]:
You know, we did the same thing with a marketing leader. I never had that problem on the product and engineering side because I had Eric and Adam and they were with me the whole way. But I think it takes a while to figure out how to put people, especially on the revenue side, sales and marketing, in a position to succeed, you cant expect them to take everything off your plate. You have to be there. Not only did I not know how to manage salespeople, I didnt know how to build a sales process. I knew none of that stuff. I started to learn that as people kept filtering through and failing, I was like, oh, well, okay. But then we stopped that, put the kibosh on it, and then took a more methodical approach with some young salespeople and then finally figured out how to bring in a sales leader.
Brian Powers [00:25:30]:
And ironically, though, the sales leader that we exited with was also a kid that I hired while he was in law school for free. He was an intern. This guy, Kyle Robbins, he was blogging for us. He's making infographics. After law school, he stayed with us, and he was in all sorts of different roles. I swore him in as a lawyer during some of our hyper growth, put him into sales, enablement role put him back into an account executive role. We had one really good sales leader for about two years, and then he took us about as far as he could, and I ended up just taking a chance on Kyle. So Kyle, like, who ended up being the last vp of sales for PactSafe.
Brian Powers [00:26:11]:
This is an interesting story, but I think it's unfortunate. But you make a lot of hiring mistakes.
Matt Tait [00:26:17]:
Well, that transition out of founder led sales is harder than people give it credit for.
Brian Powers [00:26:22]:
Yeah, it is. The initial part of it is difficult, but then it's also very difficult later on, too, when you like, there's this feeling that once you have some sort of established sales process, that you can still go in and save every deal or have that magical touch. And a lot of times that is true, but it's a death knell that truly scaling your sales and marketing processes where if you have to be ever present, we kind of forced it and we put some rules of engagement in on when I was a part of a sales process and when not and sort of stuck to it. But you know, over time it works.
Matt Tait [00:26:56]:
I like that. Sort of stuck to it.
Brian Powers [00:26:58]:
Yeah. I mean, sometimes you just can't help.
Matt Tait [00:27:00]:
Yourself, but, oh, I mean, the hardest thing is when, you know, if you stepped in, you could help them save a deal, but it's actually better for the overall growth in the company to let them lose the deal on their own and learn from it.
Brian Powers [00:27:15]:
But it was very gratifying once you started to see and hear things happening, you know, without you in the room or with you in the room but not participating. Those are proud moments where you're like, man, okay, these guys know what they're doing. They don't need me anymore. I can go focus on something else, but, you know, making sure they always needed you if they didn't. Right.
Matt Tait [00:27:35]:
Well, it's kind of like watching your kids grow up and they do something and you're really proud of it. And particularly when you have employees that have grown up with the company or the company as it grows up, like you have some of those same proud moments, I think.
Brian Powers [00:27:47]:
Yep, 100%. Those are definitely some of my best memories, of fact, safe, just watching some of the people grow in very unexpected ways.
Matt Tait [00:27:56]:
The other side of that though, too, is, and you guys got up to, I believe, about 50 people. Sometimes as you grow, you outgrow some people, and it just is a fact of life. How did you experience and deal with that too? Because you had a pretty tight knit team.
Brian Powers [00:28:12]:
I got pretty lucky that we had some early hires that were able to, like, grow, you know, professionally and personally in a way that they did not become outdated. I think at every stage of business you have that inflection points where your leadership team and other people just are better off somewhere else and the company's better off with finding somebody that's been to that next phase of growth. Every once in a while you're going to have people that are going to be there forever, and that's great. But I think those are pretty rare. And I think a lot of times companies probably hang on a little bit too long to, like, the tight knit culture, you know, may suffer for it, but we were always pretty quick on that front. And I was always very honest with the team. We had let some people go that had been there for a while. You know, they were management roles and everybody was a little miffed by it.
Brian Powers [00:29:02]:
So I put a graphic up where it showed, like, on one side of the screen you had like, here are the people we let go on this side of the screen. It's like, here are all the people that are on the team, and here's their families and all these people, right? And so this slide kept growing. It's like, here we are and. Q one of this year. Q two of this year. Q three of this year, the people that were with us kept growing, right. And it became this giant thing. And over here was pretty small.
Brian Powers [00:29:27]:
We're like, we wish them the best, but they're better off. And we're better off. Every time we let somebody put somebody over into this box and we let them go, we're all better off. And the company's continuing to grow over here. It's like you don't want to do that. I mean, the days where you make new hires, to me, were some of the best days ever because you're just so excited and hopeful for what that might mean for the company, you also have to when it's time. And a lot of those were because we just were in a different phase of growth. But I don't think that ever stops.
Brian Powers [00:29:58]:
I think founders and CEO's, a lot of them at some point the business can outgrow them. It doesn't always happen, but it does. It's just the way it is. I think being honest with your team and about the realities of that, just really the only way to do it well.
Matt Tait [00:30:12]:
And the hardest thing about the CEO's that get outgrown is everybody else can get fired by that CEO and somebody. It's tough for that CEO to fire him or herself true. So I want to go back to your story, because I want to get to the fun part for everybody, which is you exited and sold, made a bunch of money. But one of the things I thought was really interesting when we were doing our prep call, and to be fair, you and I have known each other for years and years, too. When you talk about the pandemic, you talked about the pandemic not in terms of how hard it was for the business, but the opportunity that it opened up. And that ultimately led to either what was going to be a big fundraise or an exit. Talk a little bit about that pandemic timeframe and how that led to the eventual acquisition of PactSafe by Ironclad.
Brian Powers [00:31:02]:
Yeah, so, I mean, just like everybody else, the beginning of the pandemic was a shit show. It was crazy. But in terms of, like, the operational side of the business, it didn't really impact us. I mean, like, I think most young tech startups, everything was online. We were already using Zoom, already using Slack. It was very simple to put some protocols in place and readjusted and didn't really skip much of a beat there. I think what made the pandemic interesting for us is that it magnified our value proposition in the marketplace. You think about what a clickwrap agreement is.
Brian Powers [00:31:33]:
It's just a very, very seamless, frictionless way to inject a contract into some other business transaction. When I sign up for Spotify, which is a big clickrap customer of ours, that form was created to sign me up. It wasn't created to create a contractual relationship. That's not really what the business cares about, but you have to inject the contract into it. And so clickgraft was really just the quickest, most seamless way to inject the contract into some sort of digital transaction. And you think about the way the world changed for everybody very quickly, is everything became digital. We had these big customers, prospects come in like Dell, where they're like, hey, we're changing a lot of the way we do business. We need a more frictionless experience for our customers that are signing NDAs or doing this, that, that we need to be more cloud centric, blah, blah, blah.
Brian Powers [00:32:28]:
And so we saw quite a bit of that. And, you know, at the time, everybody thought the world was changing forever. We know now that things have come back a little bit of. But what it did is it got our value proposition out there in a way that probably would have taken us years and years and years to get out into the market. So it sort of accelerated that. What I talk about when I say creating demand in the marketplace, the pandemic, in a way created additional, somewhat artificial demand for our product. So we had our best quarters ever during the pandemic, closed a bunch of huge deals, just kept breaking records on deal size and quarter quarterly goals and stuff like that. And there were a bunch of companies that got to experience that as well.
Brian Powers [00:33:09]:
But by and large, a lot of the SaaS world took a few steps back. So that was pretty unique for us. And that not only was there additional demand for the product, but it created more visibility for why we existed and actually made our value proposition more broadly applicable. I started the business just to do those types of agreements that were native. You would expect the clickrap agreement to be in your doordash signup flow or when you're buying something from Wayfair. More and more businesses wanted to copycat that type of flow across their entire business. So they're like, we need clickrap for that. And so the market had been conditioned to look for software for something.
Brian Powers [00:33:50]:
They weren't looking to solve a problem that they already had. They were looking for a new way to do business. And so those people were looking and they found us. So that was a silver lining to the pandemic for sure, for us.
Matt Tait [00:34:01]:
So how did that end up leading? You ended up getting acquired by Ironclad. Was that your goal? Talk about kind of what that led to, because that type of success opens doors for tech companies and you have to walk through them.
Brian Powers [00:34:16]:
Yeah, definitely not the goal. We had had a few different acquisition discussions with pretty big companies and just never had any interest. We liked what we were doing. We thought that the market was huge. We had an analyst that was helping us create the category at that point and told us that we were sitting on like a $15 billion market that we created. The CEO from Ironclad, Jason, reached out to me on LinkedIn. I was like, hey, lets talk about stuff. So we knew Ironclad, Ironclads, a contract lifecycle management product.
Brian Powers [00:34:45]:
Its been around about the same amount of time as PactSafe, maybe a little bit earlier. Silicon Valley, theyd raised tons of money in an existing market and they were on their way to being like one of those Silicon Valley rocket ships. So Jason and I just started talking and we realized pretty quickly over the course of like 5 hours of conversations late night over bourbon, we had very similar worldviews on what, what was wrong with contracting and how it needed to be fixed and where we could take the world. And we tried to solve those problems in two very different ways. So from my perspective, I was like, well we have this momentum right now. We dont have a ton of momentum, but we have some. Ironclad has a great platform, one of the best brand names in all of legal tech and Contra and CLM. It just made sense to attach the product to their growth and build the category from there.
Brian Powers [00:35:38]:
So that was really the driving factor behind selling. I stayed on there for a couple of years and nobody forced me to do that. I wanted to do that. We felt like we werent done, we just felt like, okay, we've been fighting this battle, we proved that we can do this in the market. We've created a very, very loyal customer base. Let's use this to kind of accelerate the opportunity and magnify the demand and build this category out faster. So that was really the deciding factor behind it. It wasn't really money driven or anything like that.
Matt Tait [00:36:10]:
What was it like going from being the boss, being the CEO, to then being a management cog in a larger company?
Brian Powers [00:36:20]:
It was interesting. I think my experience was a little bit different because I immediately became a general manager of that product line, but I also had no budget and no direct reports, so I was kind of just like a figurehead. And that was weird. All of a sudden having an entire company rolling up to me, to being like, there's not a thing on my calendar. I'm going to have to figure out how to manage this product. These people that we made the decision to fully integrate the companies and put people into existing teams, and that resulted immediately with me having no direct reports. I was a direct report to the CEO I was on the executive team, was in board meetings. What was fascinating was, I think we all tell ourselves this at every phase of growth, it's going to be better at the next phase, we're going to get this figured out.
Brian Powers [00:37:06]:
It's going to be so much easier. Then you learn, no, it's nothing. Well, I made the mistake of thinking, okay, they're going to have everything figured out, and they had a lot of the stuff that we hadn't figured out, but it was like a whole new problem set and a whole new executive team trying to figure out the problem set from getting from 50 million to 100 million, then 100 to 200. So it was fascinating that part of it being injected into an executive team that's two stages of growth ahead of where you were two days ago was pretty eye opening and it was different shit show, same day. And you learn pretty quickly that nobody knows what the hell they're doing. I mean, none of us do. And once you get one set of problems solved and he hits some stage of growth, it's like a whole nother set of problems. And trying to get past those is the exact same goddamn shit show.
Brian Powers [00:37:54]:
I mean, it was just. It was awesome. It was refreshing in a way. It was just like, okay, I was right. No, really, nobody knows what they're doing, but you do your best, and everybody did their best, and so it was awesome.
Matt Tait [00:38:06]:
Somebody explained it to me, and they said, you know, growing a startup is like walking through a hallway. That's just a disaster. Like when your kids are young and toys are everywhere, and you think when I open that door to the next hallway and close that one, that it's going to be great, and it's really just larger toys, and your kids are growing up and the disaster is different.
Brian Powers [00:38:24]:
That's exactly right. I just. I don't think there's any way to avoid it. I'll never work for a Fortune 100 company, but I guarantee you it's a shit show up there, too.
Matt Tait [00:38:34]:
Oh, yeah, 100%. Just different than the shit shows we've seen and dealt with. You went there for a few years. You spent a couple of years at Ironclad. What ultimately led you to say, I'm out?
Brian Powers [00:38:45]:
It was just time. I was still passionate about what we were doing and, you know, was passionate about what Ironclad was doing. But I figured out that two years is probably about as long as I could go not doing my own thing. I don't think I could ever work for somebody again. I think I'm unemployable at this point. And it's not because I don't like working for people. It's just a different mindset every day. When you don't have some level of control over what's going to happen with, like, strategically the future of the company.
Brian Powers [00:39:14]:
And I had lots of input there, and I still talk to Jason and other people at Ironclad all the time, but it was just time. It was a good time. Like, family wise. Like, I have two girls in high school, one who's going to be in college next year, and I'm like, man, I have an opportunity to just spend the next three or four years at home and not miss a thing. And I'm lucky enough that I don't have to work. So that's it. It was just time.
Matt Tait [00:39:38]:
You think you'll ever get back into it?
Brian Powers [00:39:40]:
That's a tough question. I mean, I get the. Itch every once in a while when I come into my office and I'm doing something, I'm like, it feels good to be doing something. Or, like, even talking now. Like, you miss all that. You miss. I hate the word grind. But you miss that part of it, too.
Brian Powers [00:39:56]:
Not all the time, trust me. Like, there's plenty of days where I'm perfectly happy. Gardening, building legos, making breakfast and lunch for the girls before school, taking a nap, swimming. But I don't know. It would take another one of those ideas that I just can't ignore.
Matt Tait [00:40:11]:
Then do you think it'd be your idea? It'd be your idea versus somebody else comes to you with one?
Brian Powers [00:40:17]:
I think so.
Matt Tait [00:40:18]:
Well, I really appreciate you, and I really appreciate the time. I'm interested. Usually I give one question to end it, but for you, I'm going to give two. Okay, so first question. That is my atypical one. For those, let's call them kids, those people out there that are just coming out of law school that are thinking of at least legal career. Some of them are meant to do it, some are not. What piece of advice would you give them as a recovering attorney?
Brian Powers [00:40:49]:
So I'd say you don't have to think only in terms of, am I going to get a job with a law firm? It's probably a good idea, too, because it's a great training ground. As you know, I think the most valuable thing you come out of law school with is just a way of thinking and a way of analyzing and solving problems that is drastically different than other professions. And that was invaluable to me as a tech founder and CEO. Like, just the ability to think like a lawyer and analyze issues and come up with solutions based on empirical proof. Right. Like, the things that have happened. There's a lot you can learn from other people's successes and mistakes, and it's a very valuable problem solving way of thinking. It's just important to remember that I.
Matt Tait [00:41:34]:
Talk about it as the ability to input tons and tons of information from a variety of sources and come up with a variety of outcomes.
Brian Powers [00:41:42]:
You know, my prior education was engineering, which is. There's very binary solutions to most engineering problems, whereas with law. Right. Like, it's. There's very rarely one right answer. There's a lot of gray. It's an interesting way to analyze problems that is very, very helpful in leadership roles and problem solving roles, even in sales.
Matt Tait [00:42:03]:
Yeah. So going back to, you know, one of the big purposes behind this show is to talk about the scale, the messy middle and you've done that I'm interested in. The last question I'll let you go is, if you could go back and give yourself some advice about what you learned going through that messy middle phase, what would it be?
Brian Powers [00:42:24]:
More patience, especially more patience. And scaling anything or doing anything involving scaling that requires hiring people. So that's a roundabout way of saying be more thoughtful about the hiring decisions you make. Then I think try to surround yourself with people that are smarter than you and better than you, what they're being hired to do. But I think you got to have a process. You got to be patient. I mean, the most important thing ultimately to scaling a business is the people you surround yourself with, the people that you grow the business with. You can't do it all yourself.
Brian Powers [00:42:57]:
And do not rush into that. You got to be patient. You got to be methodical, get advice, learn how to evaluate talent, and just don't move too fast. I mean, you got to move sort of fast and everything you do at that stage. But the switching costs of making too many mistakes during that point of growth is hard to come back from. People always do it. I mean, it's a startup cliche, but if you can be a little bit more patient and make a few less mistakes when you're scaling by hiring people, you're going to be better off in the long run.
Matt Tait [00:43:29]:
I like that. Be patient. Go slow so you can go fast.
Brian Powers [00:43:33]:
Yeah.
Matt Tait [00:43:34]:
Well, Brian, thanks again, man. I really appreciate it.
Brian Powers [00:43:37]:
Thanks for having me, man. It was fun.
Matt Tait [00:43:41]:
Thanks so much for listening. After the First Million is presented by Decimal, to listen to more episodes and find tips to help make running a business easier, visit decimal.com/afm. Want to join the conversation? Reach out to me on LinkedIn and let's explore the messy middle.