Become a Creator today!Start creating today - Share your story with the world!
Start for free
00:00:00
00:00:01
Insights on Unique Category Fit with Verl Allen, Claravine CEO
4 Plays4 years ago
While all startups hope to be unique enough to stand out from the crowd, there are often multiple startups within the same category. What if your company doesn't fit into a standard category? What if your mission is so unique you have to trailblaze your own path in the startup world? To get a better idea of how one niche company successfully did this and grew from seed money into a Series A–all within 20 months–join us in our conversation with Claravine's CEO and founder, Verl Allen, and investor Gavin Christensen of Kickstart (a VC firm for startups in Utah, Colorado, and the Mountain West) as we bring you both sides of a Perfect Pitch. In this episode, we'll talk about:
An investor's perspective on companies with a unique category fit
Verl's advice to founders whose startup is trailblazing a new niche in the market
Why self-awareness is critical to being a founder
How leaning into and growing with pain helped Verl grow as a leader
Recommended
Transcript
Introduction and Podcast Overview
00:00:00
Speaker
While all startups hope to be unique enough to stand up from the crowd, there are often multiple startups within the same category.
00:00:06
Speaker
But what if your company doesn't fit into a standard category?
00:00:10
Speaker
What if your mission is so unique you have to trailblaze your own path in the startup world?
00:00:14
Speaker
To get a better sense of how one niche company successfully did this and grew from seed money into a series A, all within 20 months, join us in our conversation with Clara Vine CEO and founder, Verl Allen, and investor Gavin Christensen as we bring you both sides of A Perfect Pitch.
Verl Allen's Background and Personal Life
00:00:39
Speaker
What is Perfect Pitch?
00:00:41
Speaker
It's a podcast from Kickstart that reveals the minds of both investors and entrepreneurs throughout a startup's journey.
00:00:47
Speaker
So whether that's uncovering what everyone's really thinking during a startup pitch or learning how entrepreneurs like you have managed their first major roadblock, Perfect Pitch offers an honest, quick, and tactical guide to help you on your startup journey.
00:01:02
Speaker
I'm your host, Karen Zelnick.
00:01:04
Speaker
Verl and Gavin, thank you so much for being here today.
00:01:07
Speaker
Good to be here.
00:01:08
Speaker
Good to be here, Karen.
00:01:09
Speaker
Thanks.
00:01:10
Speaker
And before we jump into the discussion, I just want to tell our listeners a little bit about you.
00:01:15
Speaker
Viral, before Clarivine, you served as both the Director of Corporate Development and Business Strategy at Adobe.
00:01:20
Speaker
Is that correct?
00:01:21
Speaker
That's correct.
00:01:22
Speaker
Yes.
00:01:22
Speaker
And you also held various leadership roles across companies like Omniture, Nograxis, and Logoworks.
00:01:29
Speaker
And I've heard you're an avid skier and a cyclist and enjoy spending lots of time in the outdoors.
00:01:34
Speaker
What else should we know about you?
00:01:36
Speaker
Spending time on my bike is probably where I'm happiest.
00:01:40
Speaker
It's one of those things that provides me grit and opportunities to grow personally.
00:01:44
Speaker
But the other interesting thing about me is I spent 12 years raising three kids by myself while I was at Adobe.
00:01:51
Speaker
That in and of itself was a pretty unique adventure for me.
00:01:55
Speaker
Absolutely.
00:01:56
Speaker
I think we could have an entire podcast session just around that.
00:01:59
Speaker
I really appreciate you being here today.
Gavin Christensen's Insights on Reading and Guests
00:02:01
Speaker
And Gavin, of course, it's great to have you back.
00:02:04
Speaker
Always a lot of really deep, amazing insights when you're on the show.
00:02:07
Speaker
We have a tradition of asking you kind of what you're reading.
00:02:10
Speaker
You're just always reading something really interesting.
00:02:11
Speaker
So what are you currently reading?
00:02:13
Speaker
What I do is I kind of alternate.
00:02:15
Speaker
I go something that's educational and helpful.
00:02:18
Speaker
And then I jump to just pure, fun, sci-fi fantasy.
00:02:22
Speaker
So I'm actually in the middle of this series.
00:02:25
Speaker
It's called the Powder Mage series, which is sort of like a steampunk sort of magic slash gunpowder.
00:02:31
Speaker
It is a ton of fun.
00:02:33
Speaker
That does sound fun.
00:02:34
Speaker
Well, we will have a link to bios for both Gavin and Verl in our show notes at kickstartfund.com.
00:02:40
Speaker
So to learn more about them, check that out.
Clarivine's Creation and Business Focus
00:02:43
Speaker
And we're going to now dive into the discussion.
00:02:45
Speaker
It's going to be a really good one.
00:02:46
Speaker
And Verl, the first question is for you.
00:02:49
Speaker
I would love to know, while you're working in corporate development and strategy roles at Adobe, you evaluated hundreds of tech vendors in the marketing space.
00:02:58
Speaker
How did what you saw there inform your inspiration for Clarivine?
00:03:02
Speaker
I think in a couple of ways.
00:03:04
Speaker
One, I had the front row seat to a big evolution that was happening in the enterprise, especially across enterprise marketing organizations.
00:03:12
Speaker
A lot of that was driven by applications and by systems integrators.
00:03:17
Speaker
So this kind of cabal.
00:03:18
Speaker
And those groups were really kind of focused on addressing this huge shift that happened in the enterprise as the kind of explosion of digital occurred.
00:03:27
Speaker
You had this huge fragmentation of the customer experience, and it was kind of software-driven to address that.
00:03:33
Speaker
What I quickly realized, though, is that as you saw this explosion of SaaS applications and this fragmentation, there wasn't a huge focus on the data side.
00:03:43
Speaker
it became clear that there's an opportunity.
00:03:46
Speaker
We're shifting from this decade of the 2010s, which is around SaaS and software, to the 2020s, which is really around data.
00:03:52
Speaker
And so it was me kind of looking around saying it's a good bet to make going forward.
00:03:58
Speaker
Cloud infrastructure on the data side was in place.
00:04:01
Speaker
There were huge opportunities that I saw and just an interesting kind of shift on
00:04:06
Speaker
and way to leverage that experience that had at Adobe.
00:04:09
Speaker
So as you think about this fragmentation that happens in the enterprise, the average marketing organization has around 80 point SaaS solutions in the enterprise.
00:04:18
Speaker
Each one of those applications has a unique data model and the kind of data structure they're dealing with.
00:04:23
Speaker
Those applications were never architected to work together, all sorts of different vendors.
00:04:28
Speaker
As we collapse that data down now into a single data instance in the cloud, kind of a data lake,
00:04:33
Speaker
there's huge problems with data quality.
00:04:35
Speaker
So as your enterprise is trying to automate the creation of digital experiences, you're trying to do machine learning and AI, business intelligence, other sorts of analytics, there's real challenges with data quality.
00:04:47
Speaker
So we're helping those enterprises solve a big data quality problem that exists and trying to move away from ETL, which is a much more reactive solution to a proactive solution around data standards and data quality.
00:04:59
Speaker
And one way to think about that is what's going on with data now is kind of like American auto manufacturers in the 70s, where they have an assembly line and they're so focused on getting cars out the door that they're not worried about quality of the door and the quality of the steering wheel and the
Challenges and Leadership in Startups
00:05:17
Speaker
quality of the motor.
00:05:17
Speaker
And by the time it gets off the assembly line, you're cranking out cars, but they're crashing and the doors are falling off and they don't work.
00:05:24
Speaker
So the quality is really low.
00:05:25
Speaker
And so what Vero and Clarivine are doing is trying to
00:05:29
Speaker
ensure quality of all those inputs while they go through the assembly line so that the stuff you get out the end is actually high quality, like cars are now today because they implemented total quality management and quality at source.
00:05:42
Speaker
What were your initial thoughts when you learned about Tracking First, now Clarivine?
00:05:46
Speaker
Did this unique category fit, raise any concerns?
00:05:49
Speaker
I'd love your thoughts.
00:05:51
Speaker
So when I first met with the tracking first founders, what struck me was these are some gritty founders who know the space well coming from Omniture and other related companies.
00:06:02
Speaker
And the quality of the customers for a company that was bootstrapped was pretty unparalleled from what I had seen.
00:06:09
Speaker
And as we dug in and understood more about the product, we realized, oh,
00:06:14
Speaker
Back in those days, there really wasn't much of a product.
00:06:17
Speaker
And then when Verl came into the mix, as they were starting to look for a CEO, really felt like, hey, this combination of these great founders who have found early product market fit without really a product, and this incredibly experienced CEO who has this great background and is now ready to do something entrepreneurial, we feel like we can navigate this together.
00:06:37
Speaker
And Verl, what kind of roadblocks did you run into and how did you work through them?
00:06:44
Speaker
Yeah, it's interesting because I wasn't coming in as a classic founder.
00:06:47
Speaker
So I came into a situation where it was a five-person team and I'm coming from an 18,000-person company down to five.
00:06:55
Speaker
We had some real challenges on the product side.
00:06:57
Speaker
And it was one of those situations we came in and realized very quickly, we can't scale this thing.
00:07:02
Speaker
money's in the bank, and now I'm on the hook.
00:07:04
Speaker
And it became quickly apparent to me that the product was not in a place to scale.
00:07:09
Speaker
And we didn't have one person in the organization writing code.
00:07:12
Speaker
It was all outsourced.
00:07:13
Speaker
So quickly, one of the big things was just starting to assemble a team that I thought we could build on top of.
00:07:20
Speaker
And that was the first big challenge, I think, for us.
00:07:22
Speaker
But the other part of this is you're going from a very early product situation where you're solving a specific use case.
00:07:30
Speaker
And
00:07:32
Speaker
What the company was doing at the time was focusing more on the use case they were solving rather than the underlying problem.
00:07:38
Speaker
And that's what kind of what brought me in, started looking at that underlying problem of really around data quality and data standards.
00:07:45
Speaker
But to go from a use case to a much broader enterprise solution, you got to really build a company.
00:07:52
Speaker
It all started for me with that first understanding of where we were going to take the business and then really looking at how do I get the right team in place.
00:08:00
Speaker
And it's tough when you're talking about trying to hire in an engineering leader.
00:08:05
Speaker
I'm not an engineer by training.
00:08:06
Speaker
So that first hire for me was a really, really critical hire.
00:08:10
Speaker
Had we got that wrong, we probably wouldn't be here talking today.
00:08:14
Speaker
I love that you pointed out that you weren't trying to tackle it all at once.
00:08:17
Speaker
You identified what you needed and then hired and then worked on the product.
00:08:21
Speaker
And I think that's an important clarification to make for people who are working on starting a business.
00:08:26
Speaker
And Gavin, going along with what Verl just said, do you have any concerns about the hiring process at Clarivine?
00:08:32
Speaker
So specifically as it relates to Verl, him joining the company prior to us funding was a really strong signal from a few perspectives.
00:08:41
Speaker
Certainly the first is that Verl's job was to buy companies for Adobe and looking at hundreds of startups a year for a decade.
00:08:48
Speaker
So really understanding what startups were compelling, both for acquisition,
00:08:52
Speaker
and understanding what opportunities were compelling.
00:08:54
Speaker
And so the fact that after all that time, Verl was like, hey, this is the one.
00:09:00
Speaker
And it was one that was as early as it was, was just a really strong signal.
00:09:04
Speaker
And then second, Verl was a different kind of archetype of CEO, coming in with tons of experience, having a lot of success and saying, okay, now I'm ready to do a startup.
00:09:14
Speaker
And so the big question in our mind was, okay, could someone who's had that kind of success on all metrics be able to scale down into a startup
00:09:22
Speaker
where it's five people.
00:09:24
Speaker
Obviously, it's played out really well.
00:09:26
Speaker
Verl, he had this gritty aspect to him despite having lots of success in big jobs.
00:09:33
Speaker
He'd been pretty financially conservative, which is a big deal.
00:09:36
Speaker
The way you treat your personal financial situation is
00:09:39
Speaker
is a huge weapon in your ability to kind of be patient with a startup.
00:09:43
Speaker
So that was part of it.
00:09:44
Speaker
And then also just whether it's the cycling or the single parenting, whatever it was, Viral had this grittiness of like, hey, I'm going to figure it out.
00:09:51
Speaker
And I'm not afraid of the risk and the drama of a startup.
00:09:56
Speaker
Since then, we've invested in other people just like Viral.
00:09:59
Speaker
Because if you can get that experience in that network and then still be gritty and determined, that's the best of both worlds.
00:10:06
Speaker
It's hard though.
00:10:08
Speaker
And there's some similarities between Gavin and some ways we've talked about this.
00:10:11
Speaker
I always describe myself as a kid from Kennewick.
00:10:14
Speaker
It's a farm town in Eastern Washington and always had a little bit of a chip on my shoulder.
00:10:19
Speaker
And I know Gavin and I have talked about this.
00:10:20
Speaker
He kind of came from Eastern Utah.
00:10:23
Speaker
And some of this is...
00:10:25
Speaker
For better or for worse, I feel at times like I still have something to prove.
00:10:29
Speaker
I don't look back and go, I've had all this success.
00:10:31
Speaker
I'm entitled to things.
00:10:33
Speaker
And I've been really fortunate as we built this company.
00:10:36
Speaker
We've been able to find like-minded folks that we've hired in leadership roles.
00:10:40
Speaker
So we kind of started with that as the archetype, I guess.
00:10:44
Speaker
and have kind of built it out through the organization.
00:10:47
Speaker
We have no drama.
00:10:47
Speaker
I mean, that's the other part of this is it's just a really interesting and fun for me opportunity.
00:10:52
Speaker
And to find this opportunity in my 50s, I kind of started on the other side of this where I got to a point where I had enough money in the bank where I was kind of three years from retiring.
00:11:01
Speaker
My kids were leaving the home and I still had a lot of energy.
00:11:04
Speaker
So I don't think of myself
Advice for Entrepreneurs and Leaders
00:11:06
Speaker
as 50.
00:11:06
Speaker
I think of myself as a 20-year-old.
00:11:08
Speaker
I'm sure just kind of figuring this out, but you have a bank account to back you up in case things go so bad.
00:11:15
Speaker
Varel, you've clearly been successful at trailblazing this niche market.
00:11:18
Speaker
What advice would you give to our listeners who feel their company sits in a category of its own?
00:11:23
Speaker
First off, we spend a lot of time thinking about what the problem is we're solving.
00:11:28
Speaker
The other part of that is getting alignment with the team around an agreement on what that is, what really the opportunity is that you're going after, and then making sure that you architect
00:11:43
Speaker
the company and the organization to meet that.
00:11:46
Speaker
So when I first came here with the original problem and the use case they were solving, I thought maybe we get this 30, 40 million in recurring revenue.
00:11:54
Speaker
As we've built and kind of not even pivoted, just extended the use cases and extended the solution, that number continues to get bigger.
00:12:02
Speaker
But what I would tell people is it's one of these things where you have to keep your eye on how do I continue to increase the size of the opportunity, but at the same time, stay really focused on solving the
00:12:13
Speaker
the near-term problem.
00:12:13
Speaker
It's really easy to take your eye off that ball and go after the big opportunity too quickly.
00:12:18
Speaker
And then you start having problems with attrition and other kind of customer issues.
00:12:22
Speaker
Get the problem right.
00:12:24
Speaker
Get alignment in the organization around the problem.
00:12:26
Speaker
And not just with your team, but with your investors.
00:12:29
Speaker
But you have to be really clear about what the opportunity is, get alignment with the team.
00:12:33
Speaker
And then lastly, really be focused on, are we disrupting or are we creating something new?
00:12:39
Speaker
Because it does change the way you think about building the organization.
00:12:42
Speaker
Yeah.
00:12:43
Speaker
And Gavin, you've been nodding your head a lot.
00:12:44
Speaker
So I'd love to know what you're thinking.
00:12:46
Speaker
I think rolls right on with this idea of being focused on the problem.
00:12:51
Speaker
Certainly one of my mantras is I'm so much more interested in pain than product or anything else because I
00:12:59
Speaker
No one really wants to deal with a startup.
00:13:01
Speaker
No one wants to put their neck on the line to pay money to this new vendor that's not proven, et cetera, et cetera.
00:13:06
Speaker
So the only reason you do it is because you have such a burning pain that has not been solved, but you're actually starting to try to solve it with your own cycles and your own team and doing it badly.
00:13:15
Speaker
And so I do think this North Star of saying, what's our insight?
00:13:19
Speaker
What's the pain?
00:13:20
Speaker
I think Veril has really brought that to Clarivine.
00:13:23
Speaker
One thing I like to do and due diligence on a company like Clarivine is to keep asking myself why, why.
00:13:29
Speaker
And you come back to, it's some kind of emotional need that the person has that is not getting satisfied.
00:13:36
Speaker
And that's why it's a top priority.
00:13:38
Speaker
Ultimately, there's no technology problems.
00:13:40
Speaker
There's a human problem.
00:13:42
Speaker
And I think being focused on that is just really important in startups.
00:13:46
Speaker
And Gavin, what percentage of companies that you see would you say have really figured out that problem versus they're just solving the obvious thing?
00:13:53
Speaker
Certainly, we've had companies with lots of revenue that have realized that what they're doing is too obvious or too easily copied, or that it's just not as critical to the business of their customers or their consumers as they thought.
00:14:06
Speaker
And so I think every company is wrestling with this, that is being very self-aware always and saying,
00:14:12
Speaker
How do we do more?
00:14:14
Speaker
How do we get customers to rely on us more?
00:14:16
Speaker
Tell us more.
00:14:18
Speaker
It's kind of like being breakeven or profitable is as much a cultural phenomenon as it is a financial phenomenon.
00:14:24
Speaker
And I think it takes leaders who are just listeners.
00:14:27
Speaker
Feral, do you have any thoughts on that?
00:14:29
Speaker
You know, we talked about people problems before.
00:14:32
Speaker
Well, it really internally, a lot of times in organizations and companies building your own company, it is solving those people problems.
00:14:38
Speaker
It's getting the right people in the right seats at the right time.
00:14:42
Speaker
And part of that as a leader is being aware of what your strengths are and what your weaknesses are, and really being willing to hire people that compliment you.
00:14:50
Speaker
And to be honest, that may be better than you and more qualified than you.
00:14:55
Speaker
And if you're self-aware enough to do that, that's where I think the value comes.
00:14:59
Speaker
I couldn't have done this by myself.
00:15:00
Speaker
There's no way.
00:15:01
Speaker
You know, it's another theme that we've talked about on the podcast is best leaders we work with have that mindset of how do I get the best players in my team who have diversity of background, of insight, and are not afraid to have people outperform them in various areas.
00:15:18
Speaker
In fact, the best CEOs literally should have someone outperforming them in every area of the business.
00:15:23
Speaker
It's hard even for the best CEOs to kind of continue to remind themselves that's okay.
00:15:27
Speaker
It takes a lot of maturity, humility, I think, to get to that point.
00:15:32
Speaker
The more and more we talk internally or evaluate companies and talk on this podcast, the more it just stands out to me that self-awareness is critical for startup founders.
Personal Growth and Leadership Insights
00:15:42
Speaker
That humility and that self-awareness and being able to continually check yourself, it's something that needs to be cultivated because it doesn't always come naturally.
00:15:50
Speaker
I've loved this discussion on disruption and forging a new category.
00:15:55
Speaker
And I want to wrap up, Viral, you have so many great insights and I'd love to know what's an effective practice you've implemented in your work or personal life that has contributed greatly to your success.
00:16:06
Speaker
A couple of things I would say is this, I've had some probably unique life experiences and at the time they seem like trials are really, really tough things to go through, but I've been fortunate enough to kind of be able to reframe those, some of those situations into really think about them more from a growth perspective.
00:16:25
Speaker
And some of those experiences, I went through a really tough divorce in 2002, and I spent 13 years raising my children by myself.
00:16:32
Speaker
And then I've sought out experiences on my bike, really tough things I've done there.
00:16:37
Speaker
But what I've learned is those experiences give me confidence when things get really tough.
00:16:44
Speaker
This last year was not a cakewalk, and Gavin's well aware of this, but
00:16:48
Speaker
I feel like those experiences are the foundation to build on when things get tough to drop on saying, I can do this.
00:16:54
Speaker
And when you go through it, you don't see it that way.
00:16:56
Speaker
But I think as you get a little bit older, you start to look back and go, wait a second, I've had all these really difficult things that haven't broken me.
00:17:04
Speaker
And in some ways have really made me much stronger and probably a better person coming out of the other side.
00:17:10
Speaker
But that's not always the case.
00:17:12
Speaker
Yeah, absolutely.
00:17:13
Speaker
I always like to remind myself that I've already survived 100% of my worst days, and so I can do it again.
00:17:18
Speaker
You mentioned that the last year wasn't a cakewalk.
00:17:20
Speaker
You wrote a really great article that we're going to link to in our show notes because I think listeners would benefit from it on fundraising and COVID.
00:17:26
Speaker
So be sure to check that out.
00:17:28
Speaker
And Gavin, I would love your thoughts on what Burrell just said and how you've seen it play out in his ability to lead Clarivine.
00:17:35
Speaker
Yeah, it goes back to what I was alluding to earlier, which is the best leaders that I've worked with have this great combination, which is confidence and humility.
00:17:45
Speaker
Those people that in their life experience have adversity and they've learned how to struggle through it and grind through it, are much more prepared for startup life, much more prepared to enjoy and understand that journey, that struggle is part of the experience.
00:18:02
Speaker
Those are the best leaders.
00:18:03
Speaker
I think Verl is a great example of being able to keep that through a successful career and then apply it in a unique way in a startup.
00:18:11
Speaker
What a great insight.
00:18:12
Speaker
And it's so interesting.
00:18:13
Speaker
We have this human nature of trying to run from pain when really leaning into it and learning and growing from it is actually going to be the most beneficial instead of avoiding it.
00:18:21
Speaker
So really grateful for your time today.
00:18:23
Speaker
Thank you so much for being here, Verl and Gavin.
00:18:26
Speaker
Thank you, Karen.
00:18:27
Speaker
Thank you.
00:18:28
Speaker
And of course, thank you for listening as we dive deep into what it takes to create the perfect pitch.
00:18:33
Speaker
If you want to learn more about our investor, Gavin Christensen from Kickstart or our founder, Varel Allen and his team at Clarivine, we'll have a link to the company and a longer bio and our show notes at kickstartfund.com.
00:18:45
Speaker
You can listen to more episodes of perfect pitch, wherever you listen to your podcasts.
00:18:49
Speaker
And if you like what you're learning, leave us a reviewer rating.
00:18:51
Speaker
We'll be back next time with more insights from entrepreneurs and the investors who fund them.
00:18:55
Speaker
So be sure to subscribe.
00:18:57
Speaker
So you don't miss a thing.