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Start, Grow and Run a successful business : Smerklo shares his experiences
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Mike Smerklo is an experienced entrepreneur, investor and business leader driven by the desire to turn ideas into reality. Having bought and scaled a small business into a publicly traded company worth nearly a billion dollars in value, he has a deep understanding of the hard work, dedication and grit that truly powers successful entrepreneurship.
His book, Mr. Monkey and Me , is a “real talk” guide for entrepreneurs who want to cut through the noise to cultivate a mindset that supports greatness. Smerklo ditches the usual platitudes of business memoirs to offer an honest look at the mental toughness and grit it takes to start, grow and operate a successful business.
Smerklo shares his entrepreneurial journey and offers pieces of advice in this episode.
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Transcript
Importance of Mentorship and Mental Readiness
00:00:00
Speaker
And I really encourage entrepreneurs to think about that is that you're going to try and do something that is really hard. So look for mentors, look for people that can help you look for people that can really help you stretch your imagination in any way, shape or form, because you're going to need it. And so if you're going to go play competitive sports or what have you, you want every advantage. Same thing with business. And the other thing I learned early on was that we all need help and we all need coaches.
00:00:28
Speaker
They can be formerly or informally. I certainly learned that early on in my entrepreneurship. Uh, I was lucky to have a guy named Bill Campbell who's another Silicon Valley legend. Um, I was one time explaining problems I was having with my own business and Bill said, who's your coach? So I don't have one. And he said, well, you know, the greatest golfers in the world, uh, had the coach Steve Jobs when he was alive and running Apple had a coach. Why the heck would you have some form of coach?
00:00:55
Speaker
And so things like that, that again, speak more to the mental aspects of the business, but just great lessons around understanding what you're getting into, understanding how hard it's gonna be, and then looking for sources of inspiration and help wherever you can.
00:01:09
Speaker
Welcome friends to The Entrepreneur Speaks. I'm your host Kofi Annemedou. Each week I host an amazing entrepreneur on their journey, successes and challenges. It is my hope that we will learn from their experiences as we all work towards living a life of passion and purpose.
00:01:30
Speaker
My expert clue, my guest, is an experienced entrepreneur, investor, and business leader driven by the desire to turn ideas into reality. Having bought and scaled a small business into a publicly traded company with nearly a billion dollars in value, he has a deep understanding of the hard work, dedication, and great that truly powers successful entrepreneurship.
00:01:56
Speaker
Today, as the co-founder and managing director of the Next Coast Ventures, Smacklow is a champion for a new generation of entrepreneurs building disruptive companies in big markets. His book, Mr. Monkey and Me, is a real talk guide for entrepreneurs who want to cut through the noise to cultivate a mindset that supports greatness. Mike is my guest today on the Entrepreneur Speaks podcast.
00:02:24
Speaker
Welcome to my show, Mike.
Mike Smirklow's Entrepreneurial Journey
00:02:28
Speaker
Hey, Kofi, it's great to be here. Thanks for having me. All right. So let's start today's conversation by you telling us a bit more about yourself and your childhood.
00:02:39
Speaker
Well, in my childhood, so I grew up in a very industrial part of the United States, a place called Toledo, Ohio, a lovely spot. I say sarcastically, first person in my family to ever go to college. I talk about in this book, I grew up with a lot of role models, not a lot of role models, a very economically challenged environment, and candidly just was looking for a way to get out. Fortunately, I was raised by a single mom
00:03:08
Speaker
who emphasized education, she continued to push me to go get educated. And that was impetus for me to go to college. Again, first was my family ever to complete a four year degree, worked my way through college and then began my career in a bunch of jobs in financial services that I hated, but really taught me the language of business. Very interesting. So how long have you been an entrepreneur? How has the journey been so far?
00:03:37
Speaker
Yeah, it's such a great question. I mean, I kind of think of myself as a lifelong entrepreneur. Um, but I, if you, if you go by the letter, the rule of the law, if you will, the first seven or eight years of my career were spent working for other folks, learning business, getting experience, building my, what I think about as my foundation of business and management leadership. Uh, and then I went out on my own, um, 20 years ago to look for a company to buy.
00:04:05
Speaker
I bought a business and ran it, as you said, in the intro from a small business to a publicly traded company headquartered in San Francisco, California. I ran that for about three and a half years as a public company CEO, but about 13 years in total before resigning and then moving on to start a venture capital firm, which has its own entrepreneurial bent as well. So I'd say, you know, by the letter of your question, the last 20 plus years, but my whole life is about been about
00:04:32
Speaker
starting things, developing things, and really the creative energy that goes with that.
The Role of Diversity in Entrepreneurship
00:04:38
Speaker
All right, so why is entrepreneurship that critical to improving many aspects of our society? Yeah, I mean, I have a strong bias on this, and we'll get into the book that I wrote about it, but I just generally believe the world needs more entrepreneurs
00:04:59
Speaker
We need more diversity in entrepreneurship, so we need to open the door for entrepreneurship to much wider group of folks. And I also think we need entrepreneurs that once they become successful, don't do crazy dumb things. And so I'm generally feeling I'm passionate about entrepreneurship. But to your real question is, I just think that when you think about the problems that our world is facing, big or small, and I think sometimes we can think about global warming or other major issues,
00:05:27
Speaker
as the only issues that are worth addressing, but everything from global warming to building out economic pockets of greatness, if you will, I tend to believe that they all will, that comes from entrepreneurship. And so I would rather back an entrepreneur to solve a problem big or small than it would other entities.
Venture Capital Insights with Next Coast Ventures
00:05:46
Speaker
You know, it's great that governments or non-for-profits will help, but I think it's really the challenge of an entrepreneur, someone who sees a problem, who decides to dedicate their life to trying to solve that problem.
00:05:57
Speaker
And then making that dream become a reality that to me is is the You know, it's what makes the world continue makes us continue to progress as a species Okay. All right, then so now let's talk a lot more about your current business next course ventures Can you please tell us a bit more about next course ventures? Yeah, I co-founded this venture capital firm in Austin, Texas about six years ago and
00:06:24
Speaker
We invest in the United States in emerging technology companies. So internet and business software companies, we invest in them in earlier stages, usually when they've just started to get some customer traction. And we help these companies grow and scale. Everyone around our firm has been an entrepreneur before. So we know the ups and downs. We know the challenges. We've all laid awake at three in the morning.
00:06:51
Speaker
trying to figure out how we're going to pay our bills or make payroll, and so we know what it's like, and we try and bring that experience and that learning to the entrepreneurs that we back.
Resilience in Business
00:07:02
Speaker
Today, we've invested in over 60 different companies in the United States, and we have approximately $500 million of assets under management that we deploy for these early-stage companies.
00:07:15
Speaker
So if I should ask you to share some of the challenges you faced in business, what would be your response? What are some of the challenges you faced in business so far? Well, I don't think we have enough time to go through all of them. But you know, I think it's this copy. I think that, you know, business is fascinating. I've been obsessed with it since I was a youngster, but I think there's the, I put it in many buckets, but if I had to lump it into two, there's the external challenges. You know, I was,
00:07:45
Speaker
I was operating in the United States in 1999, 2000 out in Silicon Valley when the dot com bubble burst and suddenly there was no money for startups. Um, I set out about my own entrepreneurial journey when right after nine 11 after the terrorist acts in the United States, uh, I was running a company in 2007, 2009 when the global financial crisis happened. And I bring these up because I think as an entrepreneur, you just have to know
00:08:13
Speaker
that something unexpected is going to happen, like a global pandemic that suddenly we're all faced with. So I think about major challenges as business owners, you can't really predict them. You just know they're going to come and they're going to be something you couldn't have imagined. And your job is to fight your way through it. The other bucket I think that I've struggled with and still struggle with today is just the mental tenacity part, the part inside your head.
00:08:42
Speaker
that gets you out of bed, that gets you to overlook the challenges and purposely go to look to, you know, push the proverbial rock up the hill every day. And so I don't think about business challenges in the, you know, I've had a major customer leave right when we were ready to go public. I wrote about that in the book. So I don't think about business challenges as an incident. I kind of put them in as major events that happen
00:09:07
Speaker
and that your job as an entrepreneur is to find a way to push through, keep going, get out of bed, wipe the tears off your face and get back after it, if that makes sense. Okay, yeah, it sure does. So what are some of the lessons that you've carried with you to your own company and also into investing? What are some of these lessons you've picked up? Yeah, I mean, I think the biggest lesson that I've picked up is I tend to believe that success in business, listen, you have to have a big idea
00:09:36
Speaker
There has to be an interesting market and we talk more about that. You have to have something that's innovative or different. And then I think the biggest lessons I've learned are the greatest entrepreneurs are the ones that have this mental toughness that I write about in the book that are able to push through. And there's a whole formula that I created in the book, but it really is about, can you develop the mental toughness to keep doing this?
Lessons from Mentors and Influential Figures
00:10:00
Speaker
And I give an example of, you know, if you had a friend come to you and say, Hey, I want to go run a marathon.
00:10:07
Speaker
Uh, you know, I want to go run a marathon, but I'm not in shape and I've never run before. You wouldn't say to that person, Hey, here's a pair of running shoes. Good luck. You would, you would show them that you're going to have to train for six months. You're going to have to change your diet. You're going to have to take a very rigorous training and hydration plan and all these different things. And I think too often in entrepreneurship, these attributes of like, just do it or follow your passion.
00:10:35
Speaker
They're kind of good to get you going, but they don't help you sustain through it. So much like you wouldn't say to a friend, Hey, good luck with your marathon. And you wouldn't show up on a Saturday ready to run 26 miles. You would train and prepare for it. I think the same thing applies to business and entrepreneurship is really how do you prepare for it? How do you have the toughness to continue through and know that things are never going to go as I planned.
00:11:00
Speaker
Reading about you, I realized that you've worked with a lot of extraordinary leaders and mentors and very great entrepreneurs throughout your career. Can you share some of the wisdom or lessons you've picked up from these people? Yeah, I'm blessed in that I was out in Silicon Valley in a really magical time and got to work with just extraordinary entrepreneurs. My first operating job, I got recruited by a guy named Mark Andreessen,
00:11:30
Speaker
and his business partner, Ben Horowitz, they're now very much well known because of their venture capital firm, Andrew Horowitz, but literally the preeminent entrepreneur, Mark had been the founder of Netscape, which was the internet browser that we all use today. The foundations of that had sold his business for almost $10 billion back in 99 and was starting a new business. And I got to go work for Mark and Ben at the very early stages of that company. And I got to see that company go from
00:12:00
Speaker
concept all the way through public offering. And then I ran my own business with great leaders around me. And now today, as I mentioned, we've invested over 60 different companies. So I've seen great entrepreneurs kind of across the board. I think the lessons that I learned, for example, from Mark, I'll never forget one time we were talking about something as it relates to boards, board of directors, and he was bringing on a very unusual board of director. And I asked him why.
00:12:26
Speaker
And he just looked at
Overcoming Mental Barriers in Entrepreneurship
00:12:27
Speaker
me as calm as can be and said, I want every advantage I can get fair or unfair. I'm going to do everything within legal and ethical boundaries, but I want every advantage I can get. And it was just that intensity around it that I really took away. And I really encourage entrepreneurs to think about that is that you're going to try and do something that is really hard. So look for mentors, look for people that can help you look for people that can really help you stretch your imagination in any way, shape or form, because you're going to need it.
00:12:55
Speaker
And so if you're going to go, you know, play competitive sports or what have you, you want every advantage. Same thing with business. Um, and the other thing I learned early on was that, uh, we all need help and we all need coaches. They can be formerly or informally. I certainly learned that early on with my entrepreneurship. Uh, I was lucky to have a guy named Bill Campbell, who's another Silicon Valley legend. Um, I was one time explaining problems I was having with my own business and Bill said, who's your coach? So I don't have one.
00:13:25
Speaker
And he said, well, you know, the greatest golfers in the world, uh, had the coach Steve jobs when he was alive, running Apple had a coach. Why the heck would you have some form of coach? And so things like that, that again, speak more to the mental aspects of the business, but just great lessons around understanding what you're getting into, understanding how hard it's going to be. And then looking for sources of inspiration and help wherever you can.
00:13:50
Speaker
Thank you so much for that. So what do you really see as the biggest mistake entrepreneurs make? Well, let's try and break it down to a couple buckets. I mean, I think when it comes to starting your business, I think sometimes people get trapped with imagining their idea isn't big enough, which sounds kind of weird. But I think sometimes entrepreneurs think, oh, well, this is, you know, it's not that great of a business. I counsel entrepreneurs to remind them that every amazing business that we've heard of, think Facebook,
00:14:20
Speaker
think Starbucks, think Nike shoes. They were all started with an entrepreneur who had a pretty simple idea. And that simple idea was to take a current solution and do something that's significantly better. But it didn't have to be, you know, when Howard Schultz was starting Starbucks, if you read his books, he didn't say, I'm going to have a Starbucks on, you know, every corner of retail throughout the world. He said, I want to create a differentiated
00:14:47
Speaker
experience, a cafe experience at the time wasn't prevalent in the United States. Phil Knight with Nike started selling shoes out of the back of his car because he thought he wanted to come up with a better shoe for runners. Even Facebook, Mark Zuckerberg started that with an idea at Harvard to meet girls. So I think that first and foremost is just think about whether or not your idea is something that people are willing to change their behaviors for, which is a really important point.
00:15:16
Speaker
And then secondly, I think the biggest mistake that I'd see over and over again I made was not getting help, not being afraid to ask for guidance and being too concerned about what others think versus saying, hey, I don't know what I'm doing here and raising your hand for help. Now let's talk about your book, Mr. Monkey and Me. So why that title, Mr. Monkey and Me?
00:15:43
Speaker
Um, well, so, so the book, I mean, to be clear, like I had a pretty good career as an entrepreneur, but this is not a memoir of sorts. It's not like, Hey, here's the Mike's Merklow story. As one of my friends said, that would be a, you know, a short blog post at best, but I wrote the book. Um, and I'll tell you about the title. I wrote the book for a simple reason. When I looked at entrepreneurs and content, um, to help entrepreneurs, I saw it falling into two categories. There was the how to stuff, how to write a business plan.
00:16:11
Speaker
how to form a corporation, things like that. And then there was the other form, which was super usually short form content. You see it all the time. If you go on the web, some of these things about what great entrepreneurs do before breakfast or what foods to eat or things like that that really don't help. They're kind of just light, fluffy stuff. And I didn't see anything that was focused on the mental aspect of entrepreneurship. And I like to write, and that's why I wrote the book, to the title,
00:16:40
Speaker
Basically, it speaks to this voice I've had in my head since I was very young. And I think everyone has it. In my case, the voice, you know, kind of sitting here, I joke like he, you know, right before this podcast, he's jumping around like, man, no one's gonna listen to you. No one cares what you say, like that voice in your head, that's fear, uncertainty and doubt, or imposter syndrome, it can show up as, hey, I don't feel like getting that I'm not gonna go do my heart my best today, a voice inside your head that's trying to prevent you from achieving your goals.
00:17:09
Speaker
And for me, it helped to make that voice a big creature, to make it a big monkey, big hairy beast jumping up and down. And that kind of became, he is the real star of the book. And the book is about how that voice was in my head and how I learned sometimes successfully, sometimes not successfully to overcome that voice and to not let it get in the way of what I really wanted to achieve. So
00:17:39
Speaker
I figured that Mr. Monkey and me was a creative way to demonstrate what we're talking about the book. And hopefully it's also, I try and have a little bit of fun and hopefully people laugh a little bit when they read it. Okay. So now let's go into some more details about the book. What indeed are the key messages from the book? Well, what I do is again, this is not the Mike Smirklow version of it. What I tried to do was I looked back and did a bunch of research on
00:18:06
Speaker
what I'd learned from working with folks like Mark and Ben, as I mentioned earlier, I looked at lessons I learned as my 13 year time of running a company. And then I also looked at what I have seen at Mexico's ventures that would make truly makes a successful entrepreneur. And as I've gone through that, I was able then and I talked to a bunch of other entrepreneurs that truly successful much more than I was and said, what do you think the biggest attributes are that helped you be successful?
00:18:33
Speaker
And from there, I was able to summarize it into a five-letter acronym called SHAPE, S-H-A-P-E, that are specific attributes that I've seen great entrepreneurs have. And I talk about that in the book. And then I also at the end of every chapter give four to five specific exercises that current or aspiring entrepreneurs can use to develop these capabilities. So it's really a how-to guide, if you will,
00:19:01
Speaker
to develop the mental toughness to be an entrepreneur or continue to be a successful entrepreneur.
Advice for Aspiring Entrepreneurs
00:19:07
Speaker
So how does one get a copy of the book? Well, and I'd highlight the fact that all every dollar of proceeds of the book goes to charity. So my wife and I set up a scholarship for diverse and underrepresented students who are into an entrepreneurship. So every dollar proceeds to the book go to that charity. So I'm not making a nickel off this.
00:19:28
Speaker
The book is available on Amazon. Mr. Monkey and me, a real survivor guide for entrepreneurs. It's available there. There's some interesting reviews there. I think mostly positive to help you understand what the book is about. It's a pretty short read. It's not going to be a multi-week endeavor, but hopefully it helps people really, again, get into this mental aspect of entrepreneurship. Thank you so much for those weights.
00:19:55
Speaker
Before we end this conversation, you've had a wealth of experience doing business all these years. And a lot of my listeners are either about to start business, some are in business.
00:20:10
Speaker
And some are kind of afraid to venture into business. So I want to spend the rest of our time together to ask for your advice to these categories of people. So let's start with the first group of people. What will be your advice to people who are desirous of starting a business? Yeah, well, I think that, listen, I kind of, I bookend this part of the advice. I mean, first part is I go back to what I said before, the world needs you.
00:20:39
Speaker
Like if you're thinking about it, you think you have an interesting idea and it's in your passion. I kind of feel like it's the classic, like when you're thinking about things in the shower or you can't get out of bed because you're laying in bed thinking about it. It's like, you know, you're ready when you just, it seems like there's no way you cannot go forward with your idea. So that's my first part and the world needs you. The second part and really in the shape formula, the E is for expectations is understand that it's going to be tough.
00:21:08
Speaker
And I think that's the thing where when I write the book, I'm not there to discourage folks. I just want you to understand much like that marathon example, it's going to be challenging. It's going to be filled with ups and downs. The world is, everyone's very busy. So the world is not going to, I joke, you know, you sit there and tell your idea and you tell your mom or your significant other and they say, that sounds great. That sounds great. The hard part is when you go out and start talking to other people about it.
00:21:33
Speaker
And they don't really care. So just know, have the right expectations going in that it's going to be a challenge. There's going to be ups and downs. The world's not going to really care that much about what you want to do. I think if you have that at the start, your chances of success are much greater. Um, so that's my, my, my two things is that we need you make sure it's something that you're really feel like you can't go to sleep at night without thinking about, and then no going in that it's going to be ups and downs. But Hey, that's, that's part of the journey.
The Entrepreneurial Journey: Perseverance and Learning
00:22:02
Speaker
Okay. So how about those who are already in business, who are facing challenges, who are on the verge of giving up? What would be your advice to such a group of people? Well, I think that my first research advice is this is why I love like great books. My favorite book about entrepreneurship would be Phil Knight's Shoe Dog, which talks about Nike, which I mentioned before, or Ben Horowitz, who I worked with the hard thing about the hard thing.
00:22:31
Speaker
I give those books as examples just because every entrepreneur, so my one piece of advice is every entrepreneur that's ever started a business, big or small, has had the oh blank moment or moments. I had mine at all where you're laying awake at three in the morning going, I don't know how I'm going to make it. I don't know how we're going to survive. I don't say that to make light of someone who's struggling. I just may, I emphasize it to say everyone goes through that.
00:22:59
Speaker
And so your job as an entrepreneur is to reflect on it, know that fortunately most businesses aren't life or death. Like even if a business fails, that's okay. You'll get a chance to do it again. Um, and also understand that this is also part of the journey. So that same, like getting started is hard. I'm going to keep using the marathon. Uh, I've completed one marathon in my life and that was plenty, but you know, everyone talks about mile 20 and says, you're going to, you're going to hit the wall and you know, it's coming, you're running, you know, it's happening. And,
00:23:29
Speaker
And so your job is to have the expectation that it's going to be hard, have the expectations that you're going to feel challenged, and then continue to push through.
Embracing Unpredictability and Continuous Learning
00:23:37
Speaker
So before we wrap up, with everything that you've learned yourself, what kind of wisdom do you like to pass on?
00:23:48
Speaker
You know, I think it's an instinct spot to answer this question. I think it's all like every day is different. I guess that's such a silly thing to say in terms of wisdom. But, you know, I don't know. Every day I get older, I feel like I have less wisdom than more, which is counterintuitive. But, you know, it's a long journey. There's things go up and down all the time. No one has answers. I guess that's my one piece of advice is that
00:24:14
Speaker
Everyone likes to act like they have the answers. Everyone likes to like to tell you they know what's going to happen, but nobody really knows. And the more you get comfort with that, I've been meditating on this. It's just like the more you get comfortable with the fact that nobody really knows what's going to happen tomorrow, oddly enough, there's something freeing in that. And so I think about the same thing for entrepreneurship or life or whatever. It's like no one knows coming tomorrow. So, you know, anyone's out there telling you they know exactly what's going to happen in the future is just downright crazy.
00:24:45
Speaker
I don't know if that's wisdom or not, but that's what I'm thinking about right now. Okay, all right then. So before we go off, what would be your general advice or last words for my listeners and viewers? Well, I think that the curiosity, anyone who's listening to this, it's great that you do this podcast. I think it's a wonderful time to be alive because of the flow of information and resources. I mean, these conversations
00:25:10
Speaker
Uh, you're in, you're in Ghana, correct. And I'm in Austin, Texas, and we're sitting here talking about entrepreneurship. If you go back even a few years ago, that would seem impossible. Um, so I think first of all, thank you for doing this too. It's a great time to be alive, to have the resources. Um, so my piece of advice would be is curiosity is probably the greatest attribute you can have. So a learning mindset, curious is what people successful, curious is how people think about different things.
00:25:40
Speaker
is a key to success, probably underestimated. And I appreciate that you're doing this and helping people really learn and expand their horizons. All right. So thank you so much, Mike, for sharing your rich experience with us today on the Entrepreneur Speaks podcast. We wish you the very best. Thanks for having me, Kofi. I really enjoyed the conversation.
00:26:03
Speaker
So this has been another exciting episode of the Entrepreneurs' Peace Podcast. I'll come your way next time with another exciting episode. I remain your host Kofi Animeidou. As always, do take good care of yourself and let's continue to keep hope alive. Cheers.