20VC: How To Strategically Build The Right Investor Base, Why Startup Timing is Like Surfing & How To Determine Whether Someone is Scaling with the Organisation or Not with Daniel Lewis, Founder & CEO @ Convoy

Dan Lewis is the Founder & CEO @ Convoy, the startup that really is the future of freight with trucking services powered by technology to drive reliability, efficiency and insights. To date they have raised over $80m in funding from some of the world's best-known investors and individuals including Y Combinator Continuity Fund, Greylock, Jeff Bezos, Marc Benioff, Drew Houston, Kevin Systrom and leading angels, Ali and Hadi Partovi. Before Convoy, Dan served as general manager of new shopping experiences at Amazon and spent time at Google and Microsoft in a number of logistics-related roles. In Today’s Episode You Will Learn: 1.) How Daniel first fell in love with the logistics space as a little boy, made his move into the world of tech with Google and Microsoft and came to found Convoy? 2.) How does Dan truly define the differences between linear and non-linear businesses? Why does Dan believe that startup timing is like surfing? How must founders think about this through the different stages of the business? 3.) What was Dan's strategy for choosing the right investors and how did he think about board composition? How can investors be used to build customer trust? How does Dan analyze and look to enhance board chemistry? What was a time for Dan when he actively went against the advice of the board? How did that play out? 4.) Why did Dan accept so many investors at the seed round? What changed between rounds that made Dan want to go big with the $62m Series B? Does Dan agree with Reid Hoffman, "if you can raise the money, do"? Why did Dan choose YC Continuity Fund as the lead growth investor of choice? What were the benefits? 5.) Why does Dan believe that scaling the first initial customers is the hardest of all? Why does Dan believe that a culture of experimentation is key across functions? How does Dan think about his own scaling as CEO? How has he seen his role change with the growth of the firm? What have been the biggest challenges of this personal learning? Items Mentioned In Today’s Show: Dan’s Fave Book: The Stranger by Albert Camus As always you can follow Harry, The Twenty Minute VC and Dan on Twitter here! Likewise, you can follow Harry on Instagram here for mojito madness and all things 20VC. Leesa is the Warby Parker or TOMS shoes of the mattress industry. Leesa have done away with the terrible mattress showroom buying experience by creating a luxury premium foam mattress that is ordered completely online and ships for free to your doorstep. The 10-inch mattress comes in all sizes and is engineered with 3 unique foam layers for a universal, adaptive feel, including 2 inches of memory foam and 2 inches of a really cool latex foam called Avena, design to keep you cool. All Leesa mattresses are 100% US or UK made and for every 10 mattresses they sell, they donate one to a shelter. Go to Leesa.com to start the New Year with better nights sleep! Zoom, fastest growing video and web conferencing service, providing one consistent enterprise experience that allows you to engage in an array of activities including video meetings and webinars, collaboration-enabled conference rooms, and persistent chat all in one easy platform. Plus, it is the easiest solution to manage, scale, and use, and has the most straightforward, affordable pricing. Don’t take our word for it. Zoom is the top rated conferencing app across various user review sites including G2Crowd and Trust Radius. And you can sign up for a free account (not a trial!). Just visit Zoom.us.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Harry Stebbings?

  Hello and welcome back to the 20 minute VC and Founders Friday with me, Harry Stebbings. You can see more from us behind the scenes at H Stebbings 1996 with two Bs on Instagram, and I would love to see you there. But time for the show today, and as a logistics nerd myself, I've wanted to have this guest on the show for a long time, so I'm very excited to welcome Daniel Lewis to the hot seat today. Now, Dan is the founder and CEO at Convoy, the startup that really is the future of freight with trucking services powered by technology to drive reliability, efficiency and insights. To date, they've raised over $80 million in funding from some of the world's best-known investors and individuals. Check this out, they have the likes of Y Combinator Continuity Fund, Greylock,

• 0:39Harry Stebbings?

  Jeff Bezos, Marc Benioff, Drew Houston, Kevin Systrom, and leading angels Ali and Hadi Partovi. Before Convoy though, Dan served as General Manager of New Shopping Experiences at Amazon, and also spent time at Google and Microsoft in a number of logistics-related roles. And I do also want to say a big thank you to Anu at YC and Hooman Radfar at Exper for the intro to Dan's day, without which this episode would not have been possible. But before we dive into the show today, what are we without a great night's sleep? And that's where Lisa comes in. Lisa is the Warby Parker or Tom Shoes of the mattress industry. They've done away with the terrible mattress showroom buying experience by creating this luxury premium foam mattress that's ordered completely online and shipped for free to your doorstep.

• 1:20Harry Stebbings?

  The 10-inch mattress comes in all sizes and is engineered with three unique foam layers for a universal adaptive feel, including two inches of memory foam and two inches of a really cool latex foam called Avena, designed to keep you cool. All Leesa mattresses are 100% US or UK made, and for every 10 mattresses they sell, they donate one to a shelter. So go to leesa.com for your perfect night's sleep. And if you're like me and lose sleep worrying about the quality of conference calls and communicating remotely, then check out Zoom, the fastest-growing video and web conferencing service, providing one consistent enterprise experience that allows you to engage in an array of activities, including video meetings and webinars, collaboration-enabled conference rooms, and persistent chat, all in one easy platform. Plus, it's the easiest

• 2:03Harry Stebbings?

  solution to manage, scale, and use, and has the most straightforward, affordable pricing. Don't take our word for it though, Zoom is the top-rated conferencing app across various user review sites, including G2 Crowd and TrustRadius, and you can sign up for a free account, not a trial, just visit zoom.us. But without further ado, I'm very excited to welcome Daniel Lewis, co-founder and CEO at Convoy.

• 2:31Speaker 01

  You have now arrived at your destination.

• 2:34Harry Stebbings?

  Dan, it's such a pleasure to have you on the show today. I've heard so many great things from Hummer at Expert to Anu at YC. So, thank you so much for joining me today.

• 2:41Speaker 02

  Yeah, happy to be on here. Thank you.

• 2:43Harry Stebbings?

  No, I'd love to get the ball rolling though by discussing a little bit about you. And tell me, Dan, when you were a little boy, did you always dream of reinventing the world of supply chains? And how did Convoy come about?

• 2:53Speaker 02

  When I was little, I was, well, I appreciated supply chain because it paid me $10 an hour during the summer. I worked, my family had a mom and pop kind of office supply distribution business around the Northwest. And so I worked in the warehouse. I'd pull boxes down from shelves. I'd load vans and small trucks and then even started doing some driving when I was, you know, later in my teenage years and in college. But that was more, I get paid during the summer, set up money for clothes and going on dates and things like that. Did not think that was going to be my career. But later on, did a bunch of things in transportation, actually. Did some work with the Panama Canal, did some work related to manufacturing and maintenance programs for airlines. I'm related to their parts distribution and maintenance. And then ultimately, I was at Amazon, actually, before I started Convoy. And you were asking kind

• 3:35Speaker 02

  of how did this come about? Honestly, I witnessed pretty powerful supply chain transformation happening via Amazon and how that can change an industry. And, you know, consumer expectations are going up. Businesses have to react, increasing the flexibility of their supply chain so they can manage inventory costs, get things to the, you know, the right person at the right time as quickly as people expect, which is, which is pretty fast these days. So, we dove in because we thought we could be part of that change. A lot of companies are doing last mile delivery. So, we looked upstream and said, well, maybe the middle mile is a really good option. And I spent a lot of time actually with Hadi Partovi and Ali Partovi, exploring some of these ideas early. My co-founder, Grand Goodell. And then we kind of came up with the right business model, in addition to, you know, four or five other ones that we looked at that weren't good.

• 4:14Harry Stebbings?

  Absolutely. I do want to touch on your time at Amazon there because you also worked at Google and Microsoft. I have to ask, from working with such behemoths, what were the kind of core takeaways, maybe operationally, from being inside that have influenced how you run Convoy today?

• 4:27Speaker 02

  I've learned from all of them. You know, they've all spent a lot of time figuring out how to build a really successful business, but they're all very different. And so, I think the one that certainly influenced me the most, primarily because I was doing it right before I started Convoy, was Amazon. And some things I took away from there were being very deep into the metrics and details of each of the businesses, each of the teams, even as the company grows, creating a structure to do that. You know, having a set of core values that you don't just use to talk about the business to recruits, but that you use every single day in meetings and in reviews and in hiring. And these values you kind of go back and back, you know, you go back to over and over again. Those are a couple of things I took away from there. You know, I think, you know, early on, when I was at Microsoft and Google, there were different sort of focuses on how do you launch a product? Microsoft spent a lot of time thinking about, hey, how do you take a product to market and launch it?

• 5:11Speaker 02

  And Google thought a lot about obsessing over a customer experience and always trying to be creative and clever and innovative around what you can give somebody that's better than what they've done before. From a product or a kind of a software experience perspective. And so I think different things stood out to me from each of those, and I learned from each of those, and ultimately that's made me, I think, better at building Convoy.

• 5:29Harry Stebbings?

  Absolutely. I do want to start, Nathan, with a slightly macro perspective of a discussion that we've had before, where you've stressed the difference between linear and nonlinear businesses, but you left me on that cliffhanger. So let's start with that. How do you define linear and nonlinear? And how do they kind of fundamentally differ?

• 5:45Speaker 02

  So I think a nonlinear business tends to have a nonlinear or a binary outcome. Either it works or it doesn't work. The businesses maybe aren't interesting at a small scale, so they could take years to take off, waiting for a lucky break. And then they, but they tend to have a strong network effect. So when they do take off, they accelerate quickly. And examples might include, you know, hit-driven businesses like video games, music, social networks, some pure marketplaces like eBay. And so some other ones, maybe like Instagram or Pinterest, which took a few years and then kind of hit and took off. And a linear business, on the other hand, can have a variety of outcomes, can be successful at different scale, different levels of scale. And so that could be things like medical device sales, or real estate, or even SaaS products that are created and sold. And the way those work is the more energy and time you put into selling this item or creating and selling it, the more business you create.

• 6:28Speaker 02

  And oftentimes it's a B to B type of business. And so it ends up being fairly linear at first. And you put an extra day or effort, you know, an extra hundred calls in, you're going to get some number of customers that buy. And so you can kind of scale the business through hard work. And what we kind of thought was the best of both worlds is what's going to fit us. Because I always came from a background of I'm going to work really hard, you know, the work ethic is going to help define and differentiate me. And so there's an advantage in going after a linear business where that hard work pays off. But the economics in building a tech business, you want that to become nonlinear at some point, where it starts to grow more on its own with less energy put in. I think convoy is that business, or one of those businesses. You know, initially getting us off the ground, it's about putting in hard work, going out and meeting customers and earning more and more of their business by delivering a great service to them. But then we iterate and we learn more.

• 7:12Speaker 02

  And as the network starts to get bigger, because transportation has a strong network effect, which we're already seeing kick in in certain markets, it can become nonlinear. And because we can build more trust and kind of have a more liquid marketplace, you know, it can start to have stronger network effects and get stronger and stronger as it scales. Scale effects as well to benefit us. And so I think trucking is a traditional linear business, and we're going to be able to make it into a nonlinear business that grows at an accelerating rate.

• 7:36Harry Stebbings?

  Regardless of kind of linear or nonlinear in status, I mean, one thing that's striking me upon is the importance of timing. Mike Dorbitt at Amplify said on the show that timing kills more companies than runway. So why is timing so crucial, do you think? And how's that been kind of prevalent with convoy?

• 7:52Speaker 02

  Yeah, that's a really, really good question. You know, someone I used to work with always described to me as surfing. He's like, you can go out there and paddle really hard, but if you're between waves, it doesn't really work. And I think the way I was envisioned it, I think I was with him once, he was talking about buying a convertible in Seattle. And I was like, well, it's great to have a convertible, but it's not that fun when it's raining. So, you know, the timing of when you pull the roof pack is going to make a big difference. Maybe Seattle's not the right spot. So I think timing is everything, actually, in building a company and a startup, because if it's not the right time, it's not going to take off. And it's not going to reinforce people to be getting excited about it. It's going to be harder to raise money. All these things are going to be headwinds. So I think that with convoy, timing was crucial. And the reason it's working really well is on the trucking side, in 2014, approximately 2015, drivers started getting smartphones with a data plan and GPS.

• 8:37Speaker 02

  And, you know, most of the US-based phone carriers started offering their free phone, the two-year upgrade phone as a smartphone. And then on the demand side, the shipper side of our business, you know, as I mentioned with Amazon and with a lot of other companies pushing on distribution times and delivery times for consumers, there's a lot of interest and a strong recognition the technology is going to help the supply chain improve. And there's a lot of innovation. Happening right now and you better get on board or you might miss it. And so a lot of people are really interested in having that conversation. So I'd say the door really opened on both sides of the marketplace that we're building about three or four years ago, right when we were considering building this.

• 9:11Harry Stebbings?

  And speaking of kind of the door opening, the door also opened in another way being fundraising. You've raised over eighty million dollars for many friends and actually former guests on the show. We mentioned Anu at Y C there. Tell me, what was your strategy for choosing the right investors and the board composition? Let's start on that.

• 9:27Speaker 02

  Yeah, I mean, if I if I go back to the beginning, I think as most early entrepreneurs would say, especially this is my first startup. And so first and foremost was just getting investors, you know, building a story that was compelling to somebody that would give us money. I think once we once we quickly realized the type of business we were going after was different than a lot of other tech companies and that our customers aren't tech companies for the most part. And so they're not aware of or even influenced by many of the notable tech investors and tech names. And so what we found when we're going to, let's say, you know, it could be the middle America, it could be Eastern Washington or or an area where someone's building a manufacturing plant. We need to build credibility with them when they need to trust us because they're going to start, you know, they're going to give us the the product of their their labor and they're going to trust their the experience that their customers have

• 10:10Speaker 02

  receiving their products in our in the trucks that we're that we're sending over. And so there's a lot of trust that had to be built up. And we actually thought about our investors as a way to build that trust. And so when we were able to get investors that that had built significant companies to come be a part of Convoy, that lent a lot of credibility and trust to our customers where they could say, okay, the founder of of Amazon or the person who, you know, created and developed eBay or built up Starbucks, these brands that people can definitely recognize outside of tech, gave them the confidence that people who understood other businesses were bullish on Convoy. And that really helped us get customers early on. So I think the beginning of the strategy was investors can help us earn credibility with customers. And then since then, it's really paid off in terms of many, many dozens of customer introductions

• 10:52Speaker 02

  and and business deals that we've been able to get via introductions and credibility that that began with our investors. And then also, you know, being able to hire and attract additional talent.

• 11:00Harry Stebbings?

  Can I ask, from an internal perspective, how did you think about board composition?

• 11:04Speaker 02

  Yeah, we wanted, I think some people kind of lean in to their investors and their board and think, okay, I'm Approach this is I'm going to get a lot of value and I'm going to work with these people really closely and I want to have a great relationship and I want to use their experience to get a lot for my company and some people kind of lean out and say this is a necessary evil of building a company. And I was much more in the first camp. That's why we ended up having quite a few investors. I received some advice really on Dan, you have to choose, are you going to lean in and is this going to be something you nurture and develop, beginning a lot of value from this over time? If you're not going to, don't worry about having as many people, but if you're going to lean in and get that value, then consider everyone that's investing as a resource and really play into that. So the board was the same where we really wanted to have people around the table who had seen a lot of different things, who had built companies, who had gone through this journey before,

• 11:46Speaker 02

  and who were really well-connected networks so that across many dimensions of this, from the quick question of, hey, when you built your company, what happened here? To, hey, we're scaling at this point. Who else do you know that's done that? We would get a lot of really high-quality answers. So the board composition came very much down to people that we felt would be really, really valuable for building a business and that was how we also chose the investors that we had. Fortunately, and I would say we didn't probably plan this as well as maybe should have, the chemistry of the board is super important. I think we have a great board chemistry. I think people really respect each other and get along within the board and so it ends up being really healthy.

• 12:17Harry Stebbings?

  Can I ask, you spoke about kind of board chemistry there. I think an interesting time is always when some element of friction is added. I'd love to hear about a time where maybe you've not gone with a board suggestion. How did you communicate this and kind of what's the advice for founders on maybe not taking the suggested board path?

• 12:34Speaker 02

  Yeah, I would say a couple of things is on that, the key point there, I think is, you know, the advice on that, it's your decision. At the end of the day, you have to make the decision and own the outcome of the decision. Your board is giving you advice. It probably sometimes feels like because everyone on the board is often more experienced in you or has had more success to date in their career, that what they say is what you should do and that if you don't do it and you go back and you're not successful, then they're going to hold it over your head. I think that the opposite is actually true, which is, A, they're probably really busy, so they might not remember what they said. They're saying it off the cuff. They're saying it based on a lot of experience, but they're not seeing everything that you're seeing and whatever outcome happens is your responsibility. They're not going to say, well, you know, I did give you that advice, so therefore it didn't work. It's definitely on me. It's your decision. So you just need to always remember that you have to live with it.

• 13:19Speaker 02

  So you need to make the decision and they're seeing this part time, you're seeing this full time. In terms of the decisions and some things, I mean, we've had some pretty significant discussions about pace, the types of categories we go into. And from time to time, someone will suggest something that's just, you know, would be really distracting. It's like, hey, why don't you go into maybe what about this market? Or I think at one point, the board was pretty convinced we really needed to go into, you know, working with the ports, doing container dredge and things like that. And, you know, that was all part of us becoming more educated about this business. And just like me, they're getting educated about the business as we're growing it. And they're going to have reactions that are incorrect, or maybe they're lacking, you know, the right level of visibility or information. So in those cases, I mean, especially a couple of the different categories we didn't go into,

• 13:59Speaker 02

  that was me and other people at Convoy saying, we hear you, not the right time would be too distracting. Or we hear you, here are the four other variables as to why that would actually take us off the rails. I think it's about having confidence that you have to believe in what you're doing. And you can't just go on the whims of people that are advising you and you can't let that down.

• 14:18Harry Stebbings?

  For sure. You mentioned a potential kind of disagreement, maybe, or conversation around pace. I'm intrigued. You raised a large 62 million Series B. Why is such an increase on the previous round? And how does an injection of capital like that affect kind of capital efficiency thoughts for you?

• 14:35Speaker 02

  I think that and around pace, I think everyone, it's kind of been faster, super fast, right? There's kind of some variations around like, well, how should we think about different geographies? And how should we think about different services? And how much do we need to know before we accelerate? And the kind of where is that exact line? And that's where the debates and discussions usually come out. This is a massive industry. It's an 800 billion dollar market in the United States alone. It's a two-sided marketplace with businesses on both sides. The minimum viable footprint for launching this brokerage, this marketplace is across multiple cities, multiple lanes, and with a couple of different truck types we found. So we needed to raise a lot of money because kind of the footprint for building this sort of large scale transportation business with a high, you know, average sale price per job and everything like that,

• 15:17Speaker 02

  required kind of a lot of structure and a lot of people initially to develop the two sides of the marketplace, both from an engineering perspective, but also from sales and relationship management. And then also from, you know, operations and support as we're, as we're building this. So the scale of the of kind of the minimum viable marketplace here around trucking is pretty significant. The best comparison there is a lot of times when a consumer marketplace is forming, it can form in a neighborhood, right? You can have a service that forms within one specific neighborhood, food delivery service, or you can have one that forms within a city or a metro area. In trucking, because most of our customers ship out of multiple cities and most truck drivers go into multiple cities, almost all of them, if you don't have available capacity in the other city or you don't have a job for that trucking company, you're going to be potentially quickly forgotten or less valuable to them.

• 16:02Harry Stebbings?

  How did that injection affect your mentality towards capital efficiency?

• 16:05Speaker 02

  I don't think that it did. I think that generally my DNA is very frugal and I try to be very efficient with spending money personally and, you know, and in this business. And we've always had a sense of we have to earn it. I mean, one of our core values is earn through results. We're not entitled to say, look at all this money we have. Now we can relax and spend less efficiently. We think about it as now we have a chance to go do something bigger. So I certainly don't think it's changed our mindset around efficiency. Potentially, we've been able to take more risk in terms of things we can go test and experiment, but those are just additions to the budget. We want to run them all efficiently.

• 16:37Harry Stebbings?

  Before we kind of discuss that kind of culture of experimentation, the final element on fundraising I do want to touch on. We had Anu and Ali from Y C Continuity Fund on the show. I'm intrigued, why did you choose Y C as the chosen kind of lead series B investor of choice?

• 16:52Speaker 02

  Yeah, so one, Anu and Ali are fantastic. Two, I think we felt like there was a really good opportunity to get kind of the best of two worlds. There's a growth fund, those partners, as well as the organization general, has very, very deep ties into many of the growth stage companies across Silicon Valley and across the world. And so we would be able to get a lot of great experience and insights from those companies through the Y C network. The partners have a lot of experience scaling and building, so they can help us understand that. So we felt like we got that benefit, which is what we needed entering kind of a growth phase. But the DNA of Y C is about deeply helping companies succeed. And it's a service mindset and sort of, as I mentioned, I want to lean into the resources. I want to lean into the investors that we're working with so we can get the most out of them and give our company the best chance at growing.

• 17:35Speaker 02

  As you mentioned, it's an efficient way of doing it because it's already a group we're working with. And so I felt like Because of that DNA that Y C has as an incubator and its founding, we can feel that. And I have never worked with a group that this quickly was, you know, so quickly into our relationship with them, has done so many proactive things to kind of help us. The Gia who runs recruiting over there is fantastic. She's been very hands on in a couple of major recruiting efforts we've had. You know, they've put together councils to advise us on different things and have given us access to a lot of the Y C resources. So I felt like we got the best of both worlds, growth, experience and network, as well as that like culture of of support and resources for startups.

• 18:09Harry Stebbings?

  I I couldn't be bigger fans of the continuity fund. But fundraising, as we discussed, that obviously allows a lot of things, but fundamentally the scaling. I do want to break that into a few components, being the company itself, yourself as CEO, and then maybe broader the team. But if we start on the company, obviously customers key to scaling. You've said to me before that the first are always the hardest. Why do you think this and kind of what experience led you to that conclusion?

• 18:33Speaker 02

  Trucking is a pretty traditional industry and folks that work in the supply chain industry have been doing this for a while. We're not bringing them something they've never purchased before and saying, here's this thing you need. We're saying, you've been purchasing this for a long time in a way that's less efficient and we can give you more value. And so that means they already have a status quo and they have to trust us to change what already works for them. And so getting the first few customers to make that decision is really critical. And so we did everything from, you know, thinking about how to build credibility with investors, how to really understand and go deep on individual customer needs to figure out what worked for them. And then putting a lot of time and sort of just building personal trust to lead into some of those first deliveries. And, you know, it's great, the first customer we ever had, they shipped one pallet. Actually, this was back before we were doing full trucking, we were just getting started.

• 19:16Speaker 02

  We wanted to test the, you know, the technology and they videotaped it and they thought it was great. They were excited about it. They were excited to to kind of be the first company to use it. So that was really kind of a cool experience. And then we got a first few, we got it rolling a little bit. And then it actually became a lot easier, at least to get our foot in the door, because people would make referrals for us where we could point to other examples of where we'd had success. But the first ones are always really challenging in this business.

• 19:37Harry Stebbings?

  We mentioned earlier the experimentation element in the scaling process. You've stated before the importance of having that culture of experimentation. What does that really mean? And how does one create a culture of experimentation where one's also So not fearful of failure.

• 19:51Speaker 02

  Yeah, I think that so what does culture really reflect? Culture reflects the values you set up in advance, but it also reflects the people you hire. You can say a whole lot of things, but if you hire people that don't reflect the culture of values that you believe in, you won't have that culture. And so one of the ways you create a culture of experimentation is you hire a lot of people who have been part of organizations and companies that do a lot of experiments. And then that that can be both the type of person from where they come, like the company they come from, but also the type of person that they are. And so investing more heavily in folks with a data background, a data science background is extremely valuable. And so we were able to do that. Early on, bringing in folks with a data background, we've only since improved and beefed that up. And then hiring people that came out of pretty strong product management cultures

• 20:33Speaker 02

  where experimentation was very valued and that were in very data centric organizations like Amazon, for example. And so I think, you know, one, talking about it a lot, saying that we value it, making it part of the process, step one, that you gotta hire people, though, that really believe in it coming in, because you're right, it is risky. And if they're not viewing it as valuable, they're actually nervous about it, they're just gonna naturally not do it. And as you scale, you can't manage everything closely, so you just won't do it.

• 20:59Harry Stebbings?

  Can I ask, Dan, how do you respond when experiments go wrong?

• 21:02Speaker 02

  Well, I'd say one thing is, an experiment never goes wrong. An experiment has an outcome and we learn from it. And the outcome could be the thing we thought was gonna work, worked, or it could be the thing we thought was gonna work, didn't work. But in either case, we now have more data and information and we can go make a smarter decision or we can run a better experiment. And so I think that's first and foremost, having a culture where there's no such thing as a failed experiment, there's just different levels of data. One thing we do that's fun, though, is when we do different types of experiments, especially ones that have more UI or more, we can, we can frame them more clearly to the employees. We put them up on a wall in our office and we'll have like the three treatments or the three different things we're gonna test. And we'll ask people to vote on which one they think is gonna win. And then they can win like a gift card, you know, like we have like prizes and stuff, so.

• 21:42Harry Stebbings?

  I love the gamification of it. That's, that's awesome.

• 21:46Speaker 02

  So there are losers in the office.

• 21:49Speaker 02

  The experiment just doesn't lose.

• 21:51Harry Stebbings?

  The other interesting element of scaling is the scaling of yourself as CEO. I've spoken to over 300 of some of the biggest tech CEOs in the world, and all of them have the commonality of struggling to scale themselves as CEO. How do you think about this? And how have you seen your role develop and change with the scaling?

• 22:06Speaker 02

  I think about it a lot. It's extremely important. We've gone fast, so our company is not even three years old yet. We've been able to scale to over 200 people. We've raised, you mentioned, $80 million. We have hundreds of customers. We're doing a lot of business. What we've done has happened really fast from the moment we incorporated this company. And so I feel like I've lived four or five startups at this point within Convoy, thinking about what my role is. Early on, I am the chief recruiter and the chief fundraiser and the chief visionary, because without getting people on board, there is no product. There is nothing to go build. And then my job became chief product officer, and I was doing a lot of product work early on to get V1 out the door. And then I became chief salesman, and I had to go out and convince a bunch of customers that this was something they were really excited about and go talk to truck drivers, really understand them

• 22:49Speaker 02

  and figure out how we can be helpful and to build for them. And that cycle doesn't stop. And it's about just stepping back and asking yourself, where can I be the most helpful? What can I do that is going to give this company the most leverage? And where have we not hired yet? And as we hire more and more extremely competent, great people at all levels of the company, including senior leaders, my role continues to change. And I step back from a lot of the day-to-day oversight and functions. And I'm starting to think, and I spend more time on some of the stuff I originally started with, which was continued recruiting, fundraising and vision. And so I think it's just going to keep going in a cycle. And that's part of how we developed.

• 23:21Harry Stebbings?

  What's been the biggest challenge? If there's been a core kind of inflection point or struggle for you in that scaling, what would you say it's been?

• 23:29Speaker 02

  I think there are two specific things. One was just the initial fear of, am I even going to be good at this? Wow, being a CEO of startup, founding this company, a lot of people are taking a risk and putting their livelihood in my hands or taking, you know, I have a lot of responsibility for them. So I think part of it was really proving to myself that this was going to be the right fit. I think that that it's felt pretty natural. It's actually felt like it did well. And I credit that to the fact that in my history, I've done a ton of different jobs. I never went deep on any one thing, which bothered me for a really long time. I always ask myself, I wish I could just go deep. Wouldn't it be? Easier if I just pick one thing and did that. I tend to do a lot of different things. And then now in this job, I'm like, oh, well, that all turned out well because that's actually exactly what I needed for this job. So that was kind of part one was that just rationalization of this is the thing I should be doing and I'm gonna and and I'm gonna just go full steam into getting everybody fired up about this.

• 24:13Speaker 02

  The second part that has been challenging, you know, as we've scaled the company is really knowing who else is scaling and who else needs to develop more and isn't ready yet. And that's really hard because one, everyone that joins Convoy, I think the world of, and you know, I want them to be successful. And we hire a lot of very ambitious people. So everyone wants more and more responsibility. And the question often comes up was how do I get to the next level? What's what is the next opportunity for me? And am I ready to take on a bigger level of responsibility? And the one thing I've found that is the best indicator as to whether someone's ready to scale with the company and step up and take on a bigger role and more responsibility is are they able to step back and recognize that they need to hire someone to do their own job? Can they be comfortable saying, I'm gonna bring in someone who does my job and lets me step up and do a different job?

• 24:58Speaker 02

  And can they attract and hire that person at that caliber who can replace them essentially? And when I, when people can kind of cross that chasm, maybe it's uncomfortable bringing someone to do what you're doing, but really see it that way. Hire one or two people that are as good or better than they are and prove they can bring those people into the company. That is the clearest evidence that they're ready to kind of step up and take on the next level. And I think about that for myself, too. I hold myself to the same standard, which is if I couldn't hire the people to take over these roles that I'm doing better than I'm doing them, then I might not be the right CEO. That's kind of the, I think about that across the board now.

• 25:28Harry Stebbings?

  No, I love the stepping back there, but I would love to move into my favorite element of any episode, though, being the quick fire round. So essentially I say a short statement, Dan, and then you give me your immediate thoughts in 60 seconds or less per one. How does that sound?

• 25:41Speaker 02

  That sounds good. Let's do it.

• 25:42Harry Stebbings?

  Okay, so favorite book and why? What must I be reading?

• 25:45Speaker 02

  Well, I don't know if you want to read this one. The, the, the book that burned, honestly, my favorite book, whenever I think about this question, it burned impression on me was The Stranger by Albert Camus. It was actually the first time I read a book, I read it back in, in like junior high about a completely broken person. It wasn't just a fun story, the happy ending. It made me think at that time, I was like, wow, life's way more complicated than I've experienced. And it kind of opened my mind to that. And I think The Goldfinch is kind of a similar book now. And then I also read Lord of the Rings, you know, Game of Thrones series. Before movies and the shows came out, never really got into the Game of Thrones show after reading it, because I thought it was so fantastic in the book and that I couldn't really have the experience of the show, but that kind of got me hooked on fantasy novels. So those are two of my favorites and, you know, classics.

• 26:19Harry Stebbings?

  What motto or quote do you frequently revert back to?

• 26:22Speaker 02

  You know, probably an oldie, but kind of a goodie is you only get one chance to make a first impression. I think every impression that somebody makes can be the difference between, you know, many or few options in their life going forward. And so it's never worth it to just kind of phone it in. Making a great first impression leads to many, many opportunities.

• 26:37Harry Stebbings?

  What moment in your life has served as an inflection point and maybe changed the way you think?

• 26:42Speaker 02

  Several times, I think in my life, people have really pushed me to see the value of options. As a kid, it's kind of easy to ignore that. I didn't, I don't want to put the time in to prepare and to do this thing that might lead to future options. But I had three or four people, you know, my uncle, my parents, one of my teachers really push on me to say what matters is having more options in the future. And I remember at Yale, my dean said specifically, you know, between these two jobs you're looking at, pick the one that lets you do the other one in the future too. And one was more of a one-way door, one was a two-way door. And I think that option value mindset was probably the most influential in terms of the decisions I've made in my life that have led me to have more and more options.

• 27:17Harry Stebbings?

  And then final one, talk to me, the next five years for you and for Convoy, what does the roadmap look like?

• 27:23Speaker 02

  Logistics and trucking today are about where industries like retail, music, travel, et cetera, were a decade ago. A lot of early progress, but things are just starting to get interesting. I think that over the next five years, you're going to see incredible innovation in trucking. You're going to see small trucking companies and drivers having huge benefits, having more control over their future and a completely different level of visibility and data for companies that are shipping. So I think it's going to be dramatic where we're right at the center of building all that.

• 27:47Harry Stebbings?

  Dan, as I said, I heard so many great things from the team at Y C. So thank you so much for joining me today. It's been such a pleasure.

• 27:53Speaker 02

  Thanks for having me on. This is, this is really fun. Thank you.

• 27:57Harry Stebbings?

  What a guest to have on the show. And as you can tell, I so enjoyed that one. A huge thanks to Dan for giving up his time today to appear on the show. And if you'd like to see more from Dan, which you must, then you can follow him on Twitter at Daniel Lewis. Likewise, we'd love to see you behind the scenes here at the 20 Minute VC. You can find us on Instagram at H Stebbings 1996 with two Bs. It'd be great to see you there. But before we leave you today, what are Without a great night's sleep and that's where Lisa comes in. Lisa is the Warby Parker or Tom Shoes of the mattress industry. They've done away with the terrible mattress showroom buying experience by creating this luxury premium foam mattress that's ordered completely online and shipped for free to your doorstep. The 10 inch mattress comes in all sizes and is engineered with three unique foam layers

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• 29:22Harry Stebbings?

  Zoom is the top-rated conferencing app across various user review sites, including G2 Crowd and TrustRadius. And you can sign up for a free account, not a trial, just visit zoom.us. As always, I so appreciate all your support and I cannot wait to bring you next week's episodes.