[00:01:14] A.J. Lawrence: And yet Scot kind of hit the ground running. I mean, he’s had all these other big exits and Spiffy is really cool app and everything, and he’s been so involved. But I think it would be cool just to touch a little bit on what took you from sort of computer engineering into the early days of tech in the 90s, and then let’s kind of go and talk about it.
[00:01:36] But first, Scot, thank you so much for coming on the show.
[00:01:39] Scot Wingo: Thanks, A.J. Appreciate you having me. Today the kids, they do this, which is spurs up, so go Gamecocks. That’s a little hand signal. Used to be surfs up, but now it spurs up, so.
[00:01:48] A.J. Lawrence: Yes. And I guess you and I were there when there was the whole big debate of some of the slogan you could use or not use in South Carolina.
[00:02:00] Scot Wingo: Yes. We’ll keep this PG-13.
[00:02:02] A.J. Lawrence: Yeah.
[00:02:02] Scot Wingo: One of my favorite jokes when I give talks about entrepreneurship is no one really knows much about the Gamecocks so if I’m out West or up North or something, so I’ll always say, people ask me, what is a gamecock? And I’ll say, I’ll tell you the PG version, it’s a butt kicking chicken. So I always get some chuckles out of that.
[00:02:18] And then another thing that we share is, I don’t know if you went to any Hootie & the Blowfish concerts, but that’s one of the fun things about that era when we went to school, was going to see them and they were just one of 10 bands we’d go see and now they’re super famous.
[00:02:31] A.J. Lawrence: Scott, the guitarist, was the guy who taught me how to be a radio DJ. So, yeah, Hootie was a regular. It was so cool because they worked, I mean it’s complete set. Even though I was never really that sound music fan at the time, they were at every show, every open concert they toured. Those were four guys who worked, they earned it. I mean, Hootie is that must defend the honor of Hootie.
[00:02:59] Scot Wingo: Yeah. So I’m from Aiken, South Carolina.
[00:03:01] A.J. Lawrence: Oh, cool.
[00:03:02] Scot Wingo: If you’re from South Carolina as well, but yeah a little town. It’s near Augusta, Georgia. It’s kind of its only claim today.
[00:03:07] A.J. Lawrence: Yeah, I know that area, the border. No, I actually went down because I ran fast and sort of caught a ball, but before I even got there, I got injured. So I never even played or did anything. But yeah, I went to South Carolina from New York.
[00:03:25] It was great four years. It took me a couple years to enjoy sweet tea, but once that happened, then I felt like okay, I think I can live here. Sweet tea is that kinda, you know, hard to do it.
[00:03:37] But how did you get into, because for me it was such a small world about the understanding of technology and what was happening back at that point, remembering sort of my experience. How did you cut from, I guess computer engineering was a little bit more forward into that area obviously than my chemistry and international relations, but how did you kind of decide to go to computer engineering and then build your own company around building technology tools? What was that kind of process for you?
[00:04:08] Scot Wingo: Yeah, so it turns out my childhood was pretty vanilla. I was kind of like upper lower income, if you will, so just like not quite middle income. But the one thing that was unique about where I grew up in Aiken is it’s a really weird town. So half the kids are kind of poor local kids, and then the other half are the children of Nuclear PhDs, physicists.
[00:04:30] And that’s because we have Savannah River Site is the largest employer in Aiken and that used to be an active nuclear breeder for Uranium that went into nuclear bombs. In Aiken, we call it the bomb plant. It’s the technical name.
[00:04:42] So it was really weird growing up in that environment cuz my high school was very bifurcated. You were either the kid of a PhD and you were doing what would now be called Calculus BC like when you were 15, or you were in remedial math. And I was pretty good on the math side, but not as good as those other kids.
[00:05:00] And our science fairs were crazy. It was like volcanoes. So I would do like the volcano with vinegar and Geiger counters. We had a kid in my high school that he built a little self-controlled autonomous vehicle that could shoot a Nerf rocket and hit a target. You could place it anywhere in the room and it would drive to it and shoot a missile. And this is like 1984. I have no idea to this day, like how that was even possible.
[00:05:22] The other thing that was unique about my upbringing was my dad is an entrepreneur. And at the time we didn’t even know what that word was. And it was kind of embarrassing because I was the only one that was kind of in the advanced math stuff whose dad didn’t work at the bomb plant. And we would just kind of say he was, he was self-employed.
[00:05:38] We didn’t really know what to call entrepreneurship, but he was a programmer. And this is all COBOL so he actually went to University of South Carolina as well. Yeah, so this is old school. He has all these jokes like COBOL begins with C, that’s kinda like a fun COBOL joke I guess.
[00:05:52] A.J. Lawrence: I put some code down on COBOL, so yeah.
[00:05:54] Scot Wingo: Yeah. And he can tell stories about the cards and all but in my house, so his entrepreneurial endeavor was he did consulting and implemented computer systems. And then ultimately, he started a company to do carpet systems. So he would go to carpet retailers and he had an inventory and a point of sale system. And it was all based on a mainframe called a Digital Electronics Corporation PDP-11. You probably know what that is, but today people may not know what it is.
[00:06:19] So in my house, I had this little tiny 2000 square house, a quarter of it was full of a mainframe computer. So he had his office in our house.
[00:06:26] A.J. Lawrence: He had a home computer.
[00:06:28] Scot Wingo: We had a home computer, yeah. Literally in the seventies I had a home computer, so I was the only person that had a computer. And my dad would let me play on it so I played Adventure Games and Star Trek games from the age of eight on and I could connect to, we had 300 bod modem so I could do that.
[00:06:45] By the time I got to college, and now you probably can’t tell, but I’m also not super athletic so I didn’t really have a team to join or anything like that. So started the computer club at my high school and was always just really into computers, so it kind of came naturally to me and always had a little bit of an edge because I grew up with a computer around me.
[00:07:02] A.J. Lawrence: Yeah.
[00:07:02] Scot Wingo: And lo and behold, that ended up being in today’s world quite a bit of a foresight to have had that exposure early on. So by the time I got to South Carolina, I wanted to be different than my dad, and he was software and I thought I would do hardware. I was really fascinated by how underlying computers work.
[00:07:19] Then I realized I’m not really good at that. Like there’s a permanence to hardware I don’t like, that if you make a mistake, I make lots of mistakes, so you make a mistake with hardware, it’s hard to fix. With software, you can fix it very easily.
[00:07:30] So I naturally gravitated, after my first year of kind of general engineering, I gravitated more to the software side of computer engineering. That’s how I got into it. But by the time I was at South Carolina, I was pretty adept at the internet and the Usenet boards and Unix and that kinda stuff. So I’ve been a geek for quite a long time.
[00:07:50] A.J. Lawrence: Wow. I mean, you were probably much more advanced, but yeah I remember those days where it was just like trying to get into the Tillman things. I had index card of Unix commands that I used to just carry around whenever I could get access to machines. But yeah, I had a Trash 80, that TRS 80 back in the day. Nowhere near as close as to what you had, but yeah, that Star Trek game with the K for the cling on.
[00:08:14] Scot Wingo: Mm-hmm. Yeah, it was good.
[00:08:19] A.J. Lawrence: Hours.
[00:08:19] Scot Wingo: Yeah. Move bass and then tell you what happened in your move. Yeah.
[00:08:22] A.J. Lawrence: Yeah. I know. I got hours in that game with the tape. I had a tape drive for it, but alright.
[00:08:28] Scot Wingo: The other thing that you’ll find interesting is, you probably had this too, let’s see if you had this experience. By the time I could drive, 15 or 16, I fell in love with Lamborghini. So I had that classic Alpine Lamborghini poster in my room. Did you have that one? It’s red.
[00:08:40] A.J. Lawrence: I know which one. Yeah. Another one.
[00:08:43] Scot Wingo: I’ve spent like $200 of my lawn mowing money on to get an Alpine radio so I could get the free poster.
[00:08:50] When I was 17, I want a Lamborghini and then my dad in a fit of frustration, cuz I liked computers but I just wanted to play games and he kept saying I should learn programming and I pushed back against that pretty hard. So then, he cleverly took a different approach one day and he slid a magazine over to me one day.
[00:09:06] We talk a lot about Lamborghini and how I was gonna get one. And he was trying to explain to me how expensive they are and then he gave me a magazine and it was Fortune Magazine. On the cover was Bill Gates, and the headline was How Bill Gates made a hundred million from his big deal with Microsoft. Well, that was the IPO. They didn’t even really call it IPOs back then.
[00:09:26] A.J. Lawrence: Yeah.
[00:09:26] Scot Wingo: So then I realized, I read that magazine and I was like, all right, I found someone geekier than I am. So that’s good news about Bill Gates. No matter how geeky and nerdy you feel like you are, Bill Gates can always kind of 10x you there.
[00:09:36] A.J. Lawrence: Yeah.
[00:09:36] Scot Wingo: So I was like, all right, that’s good. And then I figured, all right, Lamborghini, I need to do an IPO and then that’ll make me a million dollars and then I can get a Lamborghini. When I was 17, I set those goals for myself. So I wanted to be a millionaire by the time- Oh and Bill Gates was 30 years old when they did the IPO. So I was like, well, I’ll do that by the time I’m 30. Unusual set of goals for a 17 year old. But I was pretty locked in on it.
[00:09:58] A.J. Lawrence: No, those are great goals for 17.
[00:09:59] Scot Wingo: I dind’t talk about it too much cause I wasn’t sure I could pull it off. But yeah, my dad and I would talk about it a lot.
[00:10:03] A.J. Lawrence: Actually. That’s pretty cool cause I think my goals were more like getting a girlfriend. I don’t think I have much done that.
[00:10:12] Scot Wingo: The Lamborghini would get me girls was kinda how I thought about, that’s how I thought the world worked. But apparently it doesn’t.
[00:10:16] A.J. Lawrence: Yeah. But the order that helped you, where I think mine, I didn’t have the correct order of how to do that.
[00:10:23] Scot Wingo: The other big influence on me that made me really stretched is seeing Star Wars. So Star Wars has been a huge influence on my life. I saw it when I was nine and just this idea of, I felt a lot of empathy and simpatico with Luke Skywalker cuz he was like stuck in this boring, you know. I was from this little place in nowhere, Aiken, I felt like I was stuck there. And the fact he could kind of go from that to his hero’s journey.
[00:10:46] I think it kind of enabled me to stretch a little bit more than maybe other folks would’ve thought about at the time. So that was a huge influence on me. Today I’m a still, you can’t see in this shot, but I’ve got a lot of Star Wars stuff surrounding me here. Big Star Wars collector.
[00:11:01] A.J. Lawrence: In the late 95 I took a job with an agency, purely because I would’ve been the project manager for Hasbro’s tour. They had had just gotten the rights for the Star Wars toys. So we were categorizing all the Star Wars toys and I was the one who was in control of 200 toys, and I could distribute them to the developers who did my bidding.
[00:11:23] That was a good year. But alright. So you go off, you have this concept, you have your BHAG to get rich, get the car, get the girl. To anyone listening now, like kind of said, well, of course entrepreneurism. There’s courses, there’s programs. I remember once asking in business class like, oh, so how do I become an entrepreneur? And the professor like, why would you wanna do that?
[00:11:45] Your father had done the program, but maybe just kind from that program, getting your masters to then that first company, just maybe walk through that kinda thought process and what had happened there. Cause that’s, I’m finding it very fascinating.
[00:12:00] Scot Wingo: Yeah. So in engineering, we also at that point in time, didn’t have much talk about entrepreneurship. I did have one professor though and he was really into it, and his name was Dr. Pettis. And he would start every class and say, are you a mercenary or a missionary? And then he had a whole talk track about that, and he had like a cheesy slide. This is when they had overheads, this is not a digital projector.
[00:12:21] So he would like have a mercenary who was like some guy carrying a gun and then a missionary who was like going on a church mission or something. You know, it got you thinking like, what do you want to be? And then if you went and asked him, he would always kind of give you stuff. So by the time I was a junior, a couple friends and I said, let’s go ask Dr. Pettis if we could just have an office.
[00:12:38] And he said, I don’t have an office, but there’s like a closet over there and if you guys want to throw some computers in there, you can use it. Cuz we were gonna work on a project for him or something. So then suddenly we had an office and we were like living like grad students and we would like basically live in that room because we were working on some fun project at the time.
[00:12:54] And then when it came time to graduate, he connected us with some guys at NC State that were also entrepreneurial, a guy named Tom Miller. And we went and pitched, myself and two friends who actually went up to Raleigh from Columbia, quite an adventure and pitched them on.
[00:13:08] We would come as a group and work on their project. We demonstrated some stuff we’ve been working on and that worked. They gave us kind of in-state tuition and a stipend to entice us to come, but then they were quite entrepreneurial and talked about it a lot. And then they later formalized a program, I’ve sponsored a lot of stuff there, where now they have entrepreneurship for engineers and a whole initiative around it.
[00:13:29] But at the time, it was kind of like underground set of people that kind of knew kids that were interested in, they would kind of funnel us. In hindsight, we kind of got into that system just by leaning into it a little bit and being missionaries versus mercenaries. And it worked out great for us.
[00:13:46] So I did 18 months here at NC State, and then I got some job offers, IBM, Motorola, which would be the big company thing.
[00:13:54] A.J. Lawrence: Yeah.
[00:13:54] Scot Wingo: And I thought I wanted to work for a big company and try it out because I saw the downside of entrepreneurship. My dad would work, he would literally work 140 hours. He’d like literally just sleep four hours a night and just like grind it out. So we didn’t see him a lot for like months on time. And he would like have to go fly to visit customers that had problems on a moment’s notice.
[00:14:12] So I knew there was an edge to entrepreneurship. And then I went on an interview to IBM and Motorola and it was just like depressing because they basically were like, if you work really hard for 30 years, you go from MTS 1 to MTS 20 and you could be an architect and it’s like this whole thing.
[00:14:28] Everyone else bought into it and I was kinda like, that’s a depressing pitch for me. Like I’m just gonna have to like grind it out here for 30 years and what’s the point? So I went to work for the startup and it was a guy I had worked with previously at an internship. We were at NCR together. I did an internship in Columbia NCR.
[00:14:42] A.J. Lawrence: Cool. Yeah.
[00:14:43] Scot Wingo: Yeah. So it was up in Connecticut, so at a startup he started called Bristol Technology and they hired me to be an engineer. But what I realized is I’d never, in school, I’d never had an opportunity to take a single business class or anything. I realized I really liked the business stuff and I liked talking to customers, which is an engineer, we’re almost kinda like trained to stand your cubicle and don’t ask questions.
[00:15:03] A.J. Lawrence: Yep.
[00:15:04] Scot Wingo: I’m an introvert, so that that is my natural place to be. But I like to stretch myself and try to do new things. So then I realized I really liked startups, and then a couple of my friends wanted to start a company. So after about three years of that, moved back here and started my first company in 1995. So that was my path to kind of pulling the trigger.
[00:15:24] The biggest pull is I wanted to really get back to this triangle area. I really liked it here. It was kind of the things I liked about South Carolina – the southern living and the little bit of nicer people and slower lifestyle, but with a little like 10% more high tech kind of vibe. So it was just perfect for me.
[00:15:41] I’ve been to Silicon Valley a lot, and that’s just too much. That’s like all they talk about so you can’t ever unplug. So I really liked the Research Triangle area and wanted to get back here after doing grad school here.
[00:15:50] A.J. Lawrence: Yeah, it’s a beautiful area. It’s definitely one of the areas I’ve liked the most as I’ve looked at different places around there.
[00:15:57] Well, you did that, and then after that success, you’ve had quite a bit more on this. Now you have your fourth company, Spiffy, where do you see yourself as an entrepreneur these days? You’re on the board of companies, you have your own fund, you have another company, so where are you as an entrepreneur?
[00:16:19] Scot Wingo: Yeah, so the way I think about it is I’ve tried to do something bigger and bigger every time. So my first company was called Stingray Software, 1995 to 1998. Bootstrapped that. I tried raising venture capital, failed miserably. I was literally an engineering person that had worked for a company for three years and had no business experience.
[00:16:38] The thing that got me through was some mentors, so some folks I’d met at NC State, there were a generation of entrepreneurship ahead. A guy Richard Holcomb and Chris Evans, they were great mentors for me. And it got to the point where I was using a ridiculous amount of their time and I felt bad about it, and I tried to pay them and they refused and basically said, in our community, we pay it forward.
[00:16:58] So, we appreciate you trying to pay us, but what we want you to do is help that next generation of entrepreneurs when it’s time. I said, okay. So we sold that first company to a public company for about $12 million, so that was a really good outcome with no vc.
[00:17:11] A.J. Lawrence: Yeah..
[00:17:11] Scot Wingo: And then at the time, you know I’m a Star Wars fan, at the time the internet was being born and Marc Andreessen had put out the browser and all that good stuff. And I was like, I took to that like a duck to water as you can imagine. So what happened is at the birth of e-commerce, there was more auction sites than there were fixed price sites.
[00:17:29] A.J. Lawrence: Yep, I remember.
[00:17:30] Scot Wingo: So being a Star Wars fan, I would buy stuff and I had this deadly combination. I just sold a business, we actually sold that about three months before my 30th birthday, so I actually got to achieve one of my BHAGs there.
[00:17:40] A.J. Lawrence: Yeah.
[00:17:41] Scot Wingo: But then I had two kids, so I bought a minivan. So, sad part of this story is spoiler, there’s no Lamborghini coming into the story so I have not achieved that one yet and probably won’t.
[00:17:51] So what I did is I realized there was a need to search these auction sites and have an agent go buy stuff for you. So started a company called Auction Rover. And it was a auction search engine and bidding tools company and then we also had seller tools. The idea was we would do paid search for auction sites. And then we got acquired in six months by the company that invented paid search called GoTo.com who had changed their name to Overture.
[00:18:13] A.J. Lawrence: Yeah.
[00:18:14] Scot Wingo: So that was a good exit. And then the dot-com bubble burst literally three months after we got acquired, which was good cuz we rode that out. Then what happened is in 2001 we realized that after the dot-com bubble burst, there was all this excess inventory out in the world and our seller tools were still live. We got rid of the search engine because eBay was the only auction site left after the dot-com bubble burst.
[00:18:35] So then our seller tools started to be used by Nokia, Motorola, and IBM to sell excess inventory on eBay. And we only charged $20 a month for these tools. So literally IBM sold 2 million worth of ThinkPad laptops and paid us $20. I don’t have an MBA, but I was thinking, I think we could charge more for this.
[00:18:54] So we went to those customers and they were really struggling with the software cause it was built for an eBay power seller who list. Everything they list is unique, not kind of evergreen.
[00:19:03] A.J. Lawrence: Yeah.
[00:19:04] Scot Wingo: So we redid the product for, I kind say we Henry Fordized it so if you had a million skews, you could sell them in five minutes and then that got off to the races. We took that idea and spun it out in 2001 and called it Channel Advisor. So long story short, I’ve gotten really good at raising venture capital now. So we raised 90 million of venture capital, it was one of the early B2B softwares as a service companies and we went public in 2013, so I got to check that off the box.
[00:19:28] It took a lot longer than I thought I would. I thought I could do it by the time I was 30, I ended up being 40 when I did that. But that was definitely one of my entrepreneurial highlights to ring the bell and meet Jim Cramer and all the CNBC crew. I’m a CNBC junkie, so it’s kind of like surreal to be on the other side of all that.
[00:19:43] And then around 2003, during Channel Advisor, I bought a car wash as a diversification thing and then built another one in Oh 5. I’ve always loved cars and car washes. Well, you know about cars, but car washes are always kind of been interesting to me. So then right around the time of the Channel Advisor IPO, I had my first Uber app experience.
[00:20:00] And as an e-commerce person, the way that hit me was I suddenly connected these dots and I said, we’ve seen products go digital in the form of e-commerce and that’s 5 trillion of GDP as consumer goods got turned digitalized. Consumer services are twice as big. So on an average basis, if you think about your house and your life, you actually consume twice as many services as goods.
[00:20:20] Most people, it’s even more. We just don’t need that much stuff at the end of the day but with like restaurants and travel and all the other house services and car services and all that stuff. So, I was thinking, all right, this is something that’s twice the size of e-commerce, it’s gonna go digital faster than e-commerce cuz e-commerce laid all the groundwork. How could I participate in this big economic, this kind of wave of innovation?
[00:20:40] And I felt like as an e-commerce entrepreneur, I had an edge. What Channel Advisor does is help brands and retailers sell on eBay and Amazon and other marketplaces, so I’ve been in e-commerce for 20 years. And I’ve also kind of jealous, been watching with fascination Amazon get built from an online bookstore to a multi-trillion dollar behemoth. And learned a lot from watching them, how they chewed away at that.
[00:21:02] So I wanted to get in do something more active and big there, and the idea that I settled on was Spiffy. So taking the carwash and putting it in an app and making it mobile and basically saying, could we put a dent in the car care world?
[00:21:16] The other thing I like about the car care world is no one wakes up and says, I had a great car care experience. If you’ve had a Lexus or something like that, maybe you’ve had OK car experiences. But even then, and even in this post covid world, I think we’ve all seen a degradation of customer service.
[00:21:31] So that creates an opportunity for us at Spiffy to have a 10x better experience. So at Spiffy what we do is, our technicians are our employees cause we wanna really have a premium offering controlled experience. We come to you, so we’re totally mobile. We can do oil change, car wash, and tires. So started that in 2014 as my fourth company..
[00:21:51] This is a really long answer, but then on the side what I’ve done is when I do have free time, so family first and then my company and then if I have some free time, I like to give back. So in 2015, here in the Triangle area, we had so many startups.
[00:22:06] I put a list out called the Tweener List, which was a list of our startups from a million to 80 million, so that as an ecosystem we could focus on those and help them go faster and grow and get to IPO or exit. Then I opened up a little fund around that here recently because it turns out, I believe that’s a really interesting group of companies. Because once they get to a million, the failure rate goes way down.
[00:22:28] A.J. Lawrence: Yes.
[00:22:28] Scot Wingo: And then, you know, we really love to support entrepreneurs in this area. So I thought, this is a way to potentially make money and support entrepreneurs, talk to a bunch of other serial entrepreneurs in the area, and we got together. It’s a year old now and we’ve invested over 3 million in about 50 companies.
[00:22:44] So we write really small checks. The idea is to build an index of these triangle companies and help support the entrepreneurs as a network, if you will. It’s always been here and informal, but put a little bit more of a formality around it, put some dollars into the companies so that we all have a stake.
[00:22:58] As an entrepreneur, Spiffy in my mind is my last company and I’ll take it as long. It has such a big TAM, you know, I could be at this another 20, 30 years, so I’m not leaving anytime soon. But then, at the end of Spiffy’s run, I really wanna then probably focus on just helping other entrepreneurs and take a lot of the scar tissue I’ve developed over the years and try to help people avoid. Scale their businesses, avoid the pitfalls and that kind of thing.
[00:23:23] A.J. Lawrence: Just from the experiences you have, you probably have much, much more scar tissue than I have. But I find it funny that somehow over the years, it’s a scar tissue that has more value, I find a lot of times, when I talk to younger entrepreneurs. It’s not the cool things you learn or the cool tricks, it’s how you survive basically getting that nice in the ribs.
[00:23:47] Scot Wingo: Yeah, here’s a topical one. In 2008, Channel Advisor had just raised 20 million in a series C, and the great financial crisis hit.
[00:23:56] A.J. Lawrence: Yeah.
[00:23:56] Scot Wingo: And the first thing we did was spread that money across literally like 30 bank accounts to get the FDIC limits. So there’s a piece of information that’s very topical today. So last Thursday when the poop started hitting the fan on Silicon Valley Bank, I was able to make some quick calls and hopefully helped some people. Now we know that we avoided, they didn’t have to, but at the time it wasn’t clear. So that’s the kind of stuff that you think is a once in a lifetime Black Swan event, but here we are again.
[00:24:27] A.J. Lawrence: I remember, leading up to that, because I had an agency and we were doing quite well. We were getting pitched all these crazy safe as cash, things that then soon locked up for 12 plus months.
[00:24:42] Scot Wingo: Yeah, the money market accounts.
[00:24:44] A.J. Lawrence: Yeah.
[00:24:44] Scot Wingo: Pure liquid in, but had 6% interest or something. And you’re like, that sounds too good to be true. Spoiler alert, it was.
[00:24:50] A.J. Lawrence: Yeah. I got lucky because I was like, oh, I had two banks offering me, let me think about it. And then it just locked up. It was more my deferring that I got lucky than anything back in those days. But yeah, this last weekend was one of the more interesting weekends cause much smaller, but I’m an LP on a couple of small angel funds and advisor too of a few startups and it was really like, oh, our payroll, we don’t have money with them. Oh, we’re good.
[00:25:18] Literally getting those emails Friday. And then Friday evening, like our payroll just fine or payroll didn’t go out because XYZ payroll processor uses. It was kinda a
[00:25:28] Scot Wingo: Rippling.
[00:25:29] A.J. Lawrence: Yeah. I think a bunch of people were like, wait, what? The knock ons are gonna be very interesting.
[00:25:33] I find Spiffy really interesting because I’ve started becoming involved, and only at this point, acquired some smaller productized services, content sites and stuff that I’ve looking. But one of the constant things in the acquisition entrepreneurship spaces, [is] the talk around car washes and stuff like that.
[00:25:54] And I know that’s something moving. A lot of private equity is kinda moving down to the space. People are trying to take smaller ones and move it up. And here you come with a complete, you know. Like, Oh, that’s nice that you guys are gonna spend all that money. Let’s me just disrupt that with a direct to consumer product.
[00:26:14] Scot Wingo: So having watched e-commerce, that’s where it went. Right? The whole theory here is e-commerce was the first movie and digital services is gonna be the second movie. So in e-commerce what happened is, first, all the retailers went digital with e-commerce. But then the brand said, wait a minute, I’m Nike and I’m selling to you Macy’s so that you can just put my shoes online and sell to the consumer.
[00:26:37] In a mall, you added value cuz you were in front of the consumer physically walking through the mall and you saved me all that money from having to open Nike stores. And then they started to see more people come to nike.com than macys.com. So then they basically said, why do we have all these middlemen in an online environment?
[00:26:54] It’s more what happens is as things go digital layers come out. And another thing that changes is consumer behavior. And you’re an agency person, so you probably are a fellow study of this. I find it fascinating to see how people change their behavior and what it takes to get them to change their behavior, but when they do, how it’s sticky.
[00:27:09] There’s one of my favorite reports, and you’ve probably seen this, is Deloitte came out. This is pretty old now, probably 2017, I think. They came out with this paper and some of these things are kinda like obvious but they put a framework around it. And they talked about the value-oriented consumer and the convenience-oriented consumer, and they map that to the retail landscape.
[00:27:29] The interesting thing about retail is mall-based retailers are in Death Valley, but you have dollar stores and wholesale clubs are growing like three times the rate of retail. Mall stores are in decline. And then you have the online guys. And what’s happening is that value-oriented consumer gravitates towards that dollar store and wholesale experience.
[00:27:47] The convenience consumer gravitates towards that Amazon Instacart experience. That’s left no one for Macy’s, JCPenney, and Sears. Because the mall used to be convenient but now that it’s not, it’s neither convenient or value oriented and this bifurcation has left them without a customer base. So all that was part of my thinking starting Spiffy.
[00:28:06] I was thinking there is no convenience-oriented play for car care. The Jiffy Lube’s and all they say they are, and then there’s express car washes.
[00:28:14] A.J. Lawrence: Yeah.
[00:28:14] Scot Wingo: If you asked them, they would think they’re going after the convenience for their consumer, but they’re really not. They’re kinda like, oh, we have a lobby with coffee and crappy wifi and you know, surely, you and I are never going to view that as a great experience.
[00:28:27] And then once I had that first Uber experience, I was like, this is the experience we need to try to replicate. I press a button on my phone and my life’s taken care of. That is convenience oriented versus, okay, I can go to an express wash and it only takes five minutes, but I wait in line an hour and have to vacuum it myself. That’s the fake convenience. So that was kind of the insight for Spiffy was that I feel like they have this big blind spot of what is true convenience in today’s modern world because they don’t come from the e-commerce world like I do.
[00:28:57] And if we can provide that, customers should flock to us. And you’ll find this interesting, today, we spend like a very nominal amount on advertising because people just kind of find us. They kind of say, this should exist. Cuz in their mind there’s Uber, there’s Wag, there’s all these things where I press a button on my phone and I can take care of my life. I can have someone go grocery shop for me, why can’t I press a button and have my car taken care of? So they just think it should exist and they find us.
[00:29:22] And then also, I don’t think you’ve seen one of our trucks yet, but our vans, they’re big blue and they have the giant penguin logo and that generates all this. We have like over 350 vans across the US right now.
[00:29:32] A.J. Lawrence: Okay, cool.
[00:29:32] Scot Wingo: It’s like paying for the best outdoor advertising possible, but it’s free cuz it’s on our vans. It’s traveling billboards.
[00:29:38] A.J. Lawrence: Before the show, I was telling Scot literally last night, I was having this discussion around finding a place to clean. Because some gas stations have kind of that small drive thru, I lived in Spain for five years, just moved back. After I sold my last company, took that mid retirement? Semi-retirement? Whatever. And lived in southern Spain, the typical low end.
[00:30:01] But then they had these places you would go, usually near the fancier shopping areas, almost like a VIP service. You would give the guy a key in a nice little booth, they would drive it behind the building and they would give you a car and you would come back 45 minutes-1 hour later, and your car was perfect.
[00:30:19] And they always had the fancy car collection parked right outside to kinda let you know where it was. So it’s kinda exciting when I saw your app. I was like, oh, that’s perfect.
[00:30:32] Scot Wingo: Yeah, you’re a busy dude. And I don’t know if you have two cars, but we can get both cars done simultaneously. And if you need an oil change, we’ll knock that out too. So freeze you up. You could be podcasting while your car’s being taken care of.
[00:30:43] A.J. Lawrence: I have a Tesla, but my wife has whatever the VW, Volkswagen, whatever, and there was an oil change indicator. And just trying to get advice like where to go locally. Basically started one of those like Flame Moores on whatever the local community message board and was like, okay, this is not gonna help.
[00:31:00] It’s interesting watching how the discovery process is because it’s gone from such a cool concept of how to discover local to kind of a manufactured information piece. The Yelps, the paid search.
[00:31:14] Scot Wingo: If I did do another company, I would try to put Yelp out of business side. I have no love loss for those guys. It’s an extortion racket. They’re constantly wanting you to pay for advertising. So our reviews are really bad there cuz they suppress our positives. They say they’re fraudulent. They’re like, companies don’t have that many positives. And we’re like, we can show you the transactions and we’re not soliciting. They’re like, the algorithm suppresses, but you could be an advertiser and maybe that’ll solve it. And we’re like, no.
[00:31:38] A.J. Lawrence: Back in the day they used to say, having run search agency, doing a lot of searches. There was a period of time where it was like somehow miracles if you’re spending a lot of money on paid search on the different things, you would end up with really good organic. I mean, mostly that stopped. I think there are some on the secondary engines, you can see some.
[00:32:00] You’ve had these obvious transitions, I wanna ask on one specific one you had mentioned earlier or what seemed like a transition, but then also just ask, as an entrepreneur a lot of times we go in thinking, okay, if I can rub my two sticks together fast enough, get that spark out there and start the business and it starts making money, all is good.
[00:32:21] And then all of a sudden we hit a million bucks and it’s like, wait, what’s happening here? I mean, yeah, it’s great having money but all a sudden now this stuff is harder. And then again, five. And from my experience, as I’ve approached ten and not quite broken through, I’ve had that experience again and then knocked back down to the five range.
[00:32:43] You talked about after the first business getting into sort of the raising money, cuz you had tried earlier and didn’t even, you know. You were this young student. And then all of a sudden you went with your next one after the dot-com crash. And there was, once again, for people who weren’t around, there was that period from like 2001, especially after 9/11, it was like, ok, the good days are not coming back.
[00:33:05] There was like two years where everyone was like, maybe it’s coming back? And then 9/11, it was like, oh, it’s not coming back. And then there was like what I call the drift, where people were just like, oh, please don’t talk about technology, into about 2005. Then all of a sudden it start coming back a bit. What was that like where you decided you were gonna go out, raise money? What did you have to do to transition into that type of entrepreneur? From bootstrapping to now becoming that type raising funds?
[00:33:35] Scot Wingo: Yeah. My mental model is influenced like you, I imagine. I read a lot of business books, right? So there’s Good To Great, which is a classic, which is where I mentioned the BHAG that comes from that book. And another one of my favorites is Crossing the Chasm.
[00:33:47] A.J. Lawrence: Yes.
[00:33:48] Scot Wingo: It’s a really good framework for going from 1 to 5 to 10.
[00:33:51] A.J. Lawrence: Yeah, I read that after the fact.
[00:33:58] Scot Wingo: I would’ve told you to read it. But then when I read, and this is from the guy that does Dilbert, Scott Adams, he has an old book called How to Fail At Everything and Still Win Big. And two things in that book that hit me were systems versus goals, like how to build a system. And then also this kind of concept as an individual, as you think about your career, this stack of skills. So I always use that framework.
[00:34:20] So in my first company, I was really good at engineering, right? And knew that. I knew nothing about any marketing or anything. But in that business, I got pretty good at understanding customers and how to talk to them, and that’s been a real fundamental skill for me in building anything.
[00:34:36] It’s kinda like a learned skill because making a customer happy is a little tricky. There’s a nuanced way of asking them questions to get to their pain.
[00:34:46] A.J. Lawrence: Yeah.
[00:34:46] Scot Wingo: Your intuition as an entrepreneur is you’re trying to sell is to just talk a lot because you’re kind of like to fill the space. But you’re not. If you’re talking, you’re not listening.
[00:34:54] So, I would say in my first company, that’s the skill I’ve built a a lot more, and I used that for solving the VC problem. So I pitched like all the local VCs here and they all told me no. And the reasons I got didn’t make any sense to me, but I researched them.
[00:35:07] Number one was my first business was profitable. They would say, we don’t really invest in profitable businesses. Doesn’t make any sense, right? But I was kinda like, well, if three VCs told me that, there must be something to them. And then another one said, we won’t invest in you because every investment we make has to return the whole fund, which didn’t make sense to me.
[00:35:24] Again, as an engineer, I was like that mathematically stupid because you make 10 investments, how come you’re not returning a 100x? It’s cuz they have so many failures, but anyways. So then having time to reflect on that over three years, what was happening was our TAM was too small. So that’s what they really meant and he didn’t do a good job articulating that to me.
[00:35:42] A.J. Lawrence: Yeah.
[00:35:42] Scot Wingo: So then I learned about TAM, what is TAM and why does it matter? And sure enough, my first business probably had a terminal revenue rate of 30 million and we had like 30 or 40% market share, which you usually don’t put in it, which would be highly unusual for a TAM calculation. But for smaller TAMs, you can get in there. So then over time, in that three years at my first company, I built that skill stack.
[00:36:04] Also, when I was pitching my first company, I was just talking about our customers, what we were building. Like I was doing an engineering, I was talking about the product. I didn’t really set the vision. I never had a pitch that was like, there’s this many engineers in the world and if we can get them all using, I never talked like that.
[00:36:19] So my second company, I would talk and say, look, we have this idea. There’s all these auction sites, e-commerce is gonna be huge and we’re gonna build this search engine. And the, in my first meeting, they’re like, can we write at you a $3 million check? And I was like, sure. So I got better at it. I watched a lot of other pitchers.
[00:36:35] So then as I’ve gone those transitions you’re talking about, I’ve tried to add to my skill stack and kind of get better and better at, you know, the thing I tell other tech entrepreneurs all the time is I spend almost 85% of my time selling. And it’s really, I think of it as persuading.
[00:36:51] So I have to persuade investors to invest and stay with us and add more. I have to persuade people to come work for us. I have to persuade people to stay. I have to persuade customers to come work with us. So I spent a lot of time persuading and that’s the skill that I’ve had to work on the most over my 30 year career as a tech founder.
[00:37:10] A lot of it has come from watching other people persuade, reading books, and just kind of like really trying to hone that skill over time. I had to be pretty self-aware. This is the humble part of it, is that I was really, really bad at it when I was in my twenties.
[00:37:26] Being an engineer, you kind of like have a little bit of an ego thing too, and I was probably like, these guys are stupid. Why won’t they invest in this? It’s such a good idea. You just get frustrated cuz you don’t understand why they don’t see it what you do. But that’s really a feeling on you, not them. Persuading them and showing them what you’re seeing to get them involved.
[00:37:44] A.J. Lawrence: That understanding. It’s the one thing to know how to do something. It’s another to understand why someone would want be interested into something and then put it into their own. Yeah, that in a sense, I think we all need a good amount of reps at the situation. For me, I agree very much. I didn’t learn to sell until my mid-thirties, if anything. I was in situations I thought I was selling because in the late 90s I was flying around the world and signing million dollar contracts. But the reality is, my skillset was [unintelligible].
[00:38:26] Scot Wingo: Yeah. That’s a good way to start.
[00:38:27] A.J. Lawrence: On the late 90s, it was kind of like if you knew anything about technology. You know, there was that 98, 99 that was sort like just unreal type of period of time. But yeah, learning how to get there.
[00:38:39] It seems very much like what helped you besides getting the reps, was this idea of hearing other people do. How were you hearing other people learning from that experience? What was that process for you?
[00:38:50] Scot Wingo: Here in the Research Triangle Park area, and I know in the Virginia area, you guys have that NVCA I think it’s called.
[00:38:57] A.J. Lawrence: Yeah, I just moved here. I’m a New Yorker.
[00:38:59] Scot Wingo: Okay. Every area has kind of like an entrepreneurial startup group. Ours in the triangle is called the Council for Entrepreneurial Development. So they’ll do an annual pitch event where VCs come in and they see pitches. Well, one of my favorite things to do is go watch other people pitch. I’ll mentally watch that and kind of say, I like how they approach this or that didn’t really land very good. And I’ll kind of watch it in the persona of a VC and I’ve probably seen it at this point, 500 pitches.
[00:39:29] Another thing that’s really nice is whenever someone goes public, they go on a a roadshow and now those are published. So it’s really interesting to watch people’s roadshow pitches as well. That’s where you’re seeing the most elite pitches. So it’s kind of fun to go watch the series A seed investor pitches, B and C pitches, and then kind of like the elite.
[00:39:49] Another great way to see a lot of pitches is Shark Tank. They’re cheesy, and they have a cheesiness to them, but it is interesting. It’s not that far away from reality. And you can see the judges get wrapped up in the unit economics, and the TAM, and that kind of thing. So it’s just a lot of watching other pitches is where I owes most a lot of my best pitch things.
[00:40:11] And it’s fun, we live in this amazing age where go watch every Jeff Bezos talk is amazing. Steve Jobs pitches, that’s the tip of the tippy top there to watch. Like Steve Jobs when he released any of his later products later in life. Just watching the pitch there, that stylistic approach that he takes. You don’t wanna totally be like the Theranos lady and copy, but you need to take little elements from that and build your own style. Don’t just start wearing black turtlenecks or something like that. So that’s how I’ve built that skill over time, is really watching a lot of pitching going on.
[00:40:47] A.J. Lawrence: No, I like that. Steal but make it your own
[00:40:50] Scot Wingo: My favorite pitch, and this’ll be good, there was a Mad Men episode where Don Draper is pitching Kodak. They have this new product that is for slides. That’s the best. I watch that probably once a month. I just love watching that segment. So if you Google Don Draper Carousel Kodak pitch, that is probably the best pitch you’ll ever see. It’s obviously fiction, but that’s the master persuader right there. It’s like a whole another level.
[00:41:18] A.J. Lawrence: Everyone I know who pitches or does any sort of level of pitches has that really, I remember seeing it and just being like, ohhh. After all the pitches I’ve done in my life, I was just like, oh.
[00:41:31] Scot Wingo: Of course, yeah. The best is, it’s so good that at the end the account manager says, well, enjoy your next meeting. That’s great. He knows that they’ve totally just crushed it.
[00:41:46] A.J. Lawrence: That’s always the best feeling, when you know you have won.
[00:41:49] All right. You’re talking about growing Spiffy, making it that higher quality experience. You’re looking at this concept of yourself moving more to helping other entrepreneurs grow. You have your own growing family, I have teenagers which means I don’t sleep anymore.
[00:42:10] I always thought that it was just the babies that you don’t sleep, now it’s also the teenagers again.
[00:42:16] Scot Wingo: Yeah. You didn’t anticipate TikTok and Instagram.
[00:42:20] A.J. Lawrence: TikTok, and then also 7am school days starting for high school students. I’m like, what is it with the south the most early super mornings.
[00:42:34] You’ve had success. How are you going about defining what that’s going to mean and especially as you move forward, what does success mean for you personally as an entrepreneur? Not for Spiffy, not for the companies you help, but like how are you looking to define that success for you?
[00:42:51] Scot Wingo: Yeah. I get the most satisfaction out of building things. So having an idea and I try to do things that haven’t been done before. So that’s more fun, you know? So copying something, you could do that and it is a viable business strategy. It’s not for me. I wanna do something that no one’s tried before. I don’t wanna be like the fifth VC fund. I wanna try a different thing. I don’t wanna build the 1,000,000th carwash. Let’s try a different approach.
[00:43:14] So building something that’s unique that no one’s ever done before is where I get the most satisfaction. And then inside of there’s wrapped a lot of stuff – building the team, solving the problems, making it through all the externalities like bank crisises and pandemics and all this stuff and getting through to the other side and then you can point at that and say, we built that.
[00:43:34] We had this idea and we built it from nothing. That’s what I get the most satisfaction out of. And the team building of that and getting everyone aligned in doing it and then helping, it’s infectious. Cuz like once you’re in it and doing it, you realize it’s a pretty special experience, that kind of once in a lifetime kind of thing to go. You and that team together, solving that problem is pretty special. So that’s what I get a lot of joy from.
[00:43:59] A.J. Lawrence: Very cool.
[00:44:00] Scot Wingo: I’m sure you’ve felt that as well. And you feel it if it’s a million dollar thing, it’s a retail store, that’s the fun of entrepreneurship is you can get that feeling and it’s just as good at any scale. I’m in a position where I can go for pretty big moonshot type stuff, but you don’t have to do it that way. Whatever it is you’re doing, that’s the fun part of our entrepreneurship.
[00:44:23] A.J. Lawrence: I definitely agree. I think the combination of seeing where the people who have worked with you and for you, seeing where they go on, which is funny. Now all of sudden having like nearly 30 years being like, wow, people have had an entire company. How did this happen? I remember that guy couldn’t even, like we had to remind him to bathe on a regular basis, he’s now a VP. Seeing that growth.
[00:44:48] Scot Wingo: Yeah, you had an people’s influence on that.
[00:44:50] A.J. Lawrence: Oh, hopefully.
[00:44:51] Scot Wingo: You were a part of that. And that’s important, you know.
[00:44:54] A.J. Lawrence: And then I think as you’re talking about those x factor moments, like things that in a million years you wouldn’t know, like a bank run on one of the default players in the space and how you’re able to help. For me, the threading of needles of things you just never would’ve planned as a risk factor, being to get your business. Yeah, I agree. Those are the things that kinds of glow in the hindsight. So that’s pretty cool.
[00:45:29] So Scot, thank you for sharing that. How could the audience learn more about what you’re doing? Learn more about Spiffy?
[00:45:32] Scot Wingo: Yes. Our website is getspiffy, G-E T-S-P-I F-F-Y. We’re in all the app stores so download the app. We’re not everywhere, we’re only in about 30 markets in the United States, 60 if you include franchising, but we have pretty good coverage of the major metros.
[00:45:46] And then I do pontificate about entrepreneurship. LinkedIn is a good place to follow me, it’s Scot with one t, S-c-o-t, and then last name Wingo, W-i-n-g-o. And I’m also on Twitter as Scot Wingo, just Scot Wingo altogether. So would love to have a follow and I love talking about entrepreneurship, so feel free to reach out to me. And if this stimulated any ideas or you wanna keep the conversation going, reach out.
[00:46:10] A.J. Lawrence: Cool. Everyone, we’ll make sure those are in the show notes, those links, and we’ll make sure in the newsletter when this episode comes out and in our socials.
[00:46:23] Scot, thank you so much for coming on.
[00:46:31] Scot Wingo: Yeah. Maybe we’ll run each other into Columbia at some point. Maybe one of your teenagers will go to South Carolina and we’ll see you down there.
[00:46:36] A.J. Lawrence: Definitely.
[00:46:37] Scot Wingo: Or come to the North Carolina school, so lemme know.
[00:46:40] A.J. Lawrence: I’m trying to push more to the North Carolinas, but a pint down at Five Points would be very good. I haven’t been Group Therapy in 20 years, I missed that bar. That was a great bar.
[00:46:51] Scot Wingo: It was. All right, we’ll do a reunion. Hit me up.
[00:46:54] A.J. Lawrence: I will, definitely. All right everyone. Thank you again for listening. Remember, go check out beyond8figures.com and sign up for the newsletter, so you can be the first one to know when Scot and other cool entrepreneurs like him come on the show. Alright everyone, talk to you soon. Goodbye.
[00:47:09] Scot Wingo: Thanks, A.J.
[00:47:16] A.J. Lawrence: This episode of Beyond 8 Figures is over, but your journey as an entrepreneur continues. So if we can help you with anything, please just let us know. And if you liked this episode, please share it with someone who might learn from it. Until next time, keep growing and find the joy in your journey. This is A.J., and I’ll be talking to you soon. Bye-bye.