#6 - How This Silicon Valley Outsider Hustled His Way to $750M Exit - Meet Vungle's Jack Smith

Jack Smith (@_jacksmith) is the most clever entrepreneur I know. He’s cofounded multiple startups: Vungle, Coin, Shyp. With Vungle recently selling for $750M. We talk about his early businesses as a kid, selling prank itching powder on the playground - all the way to his infamous “LinkedIn Hack” that got him his first $120k investment check. Got feedback or questions? Email me at [email protected] See acast.com/privacy for privacy and opt-out information.

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

• 0:00Speaker 00

  Basically, he stood up during the pitch and he's like banged on the table and he's like, "You guys don't know anything about advertising. There's people with like 20 years' experience at Google working on this and you just looked this up on the internet like five minutes ago and you think you can come up with better advertising company. You will never raise a single dollar of funding."

• 0:21Shaan Puri?

  That's my friend Jack, co-founder of Vungle, describing his first investor pitch. It's not exactly how you want it to go. So, uh, how's the company doing today?

• 0:31Speaker 02

  Private equity firm Blackstone is set to acquire Vungle for an undisclosed sum that is hotly rumored to be 750 million US dollars in cash.

• 0:53Shaan Puri?

  Okay, great. Is it rolling, guys? Okay, cool. Uh, Jack, man, I appreciate you coming on the show. I've been excited to have you on because every time I meet you, you are up to some new company, some new like experiment, some new kind of clever thing. I would call you sort of, you're the most clever guy I know in Silicon Valley. Like, I asked some friends the other day, I was saying, you know, if we had to nominate one of us to go on a game show, and you don't even know what the game show is, but you want, you know, you're gonna need some set of skills to win it. You're gonna have, you know, maybe you have to be good socially, physically, you have to be clever, solve puzzles, whatever. And, uh, you know what? I feel like you would be my pick because you are, you are very clever and it seems like

• 1:35Shaan Puri?

  whatever system gets put in front of you, you end up cracking the code. And, uh, is that fair? I mean, is that surprising to you when I say that?

• 1:42Speaker 00

  Um, no, I'd like to kind of think along those lines that just like trying to, whatever system is in front of me, like it was, I do think about like game shows and stuff as well, like how could you reverse engineer the rules to them type thing?

• 1:55Shaan Puri?

  Yeah, exactly. So we're going to talk about a couple of the things that you've built. So for for people who are listening, this is Jack Smith. He is an entrepreneur and a friend of mine. He has started a bunch of different things, like sort of called the jack of all trades, because he's got his hand in all different types of projects, either starting the company, advising companies, investing in companies, that sort of thing. The biggest success is a company called Vungle, which is an ad network that's doing hundreds of millions of dollars in revenue despite only raising, you know, by Silicon Valley terms, a small amount of money, about 25 million they raised, and they're doing, you know, north of 300 million in revenue. So very impressive company. But I'm going to talk a little bit less about that, not just because it's an ad network and ad networks are not the most fun thing to talk about,

• 2:39Shaan Puri?

  but mostly because I think Jack does a lot of other interesting stuff. So Jack, when I was growing up, I thought that if you if you had a million bucks, that meant you had like infinite money, you had all the money. And so that number of million was always, you know, top of mind for me. And so my goal is to find out, you know, from people, all the, you know, the different crazy things that they get up to in order to make a million bucks. And and what I want to actually know from you is, you know, I want to rewind the clock. So before Vungle, you're 15, 16 years old and you start your entrepreneurial journey. What was some of the early days, things you tried to do to make money? And was that even a was that even a priority of yours? Were you trying to make money or were you trying to do something else?

• 3:19Speaker 00

  Yeah, I mean, I never actually obsessed about money very much. But what I do value is freedom. And I think that money and I also like to try and be like successful. And I feel that just like money is just kind of the barometer by which we measure success. If I was a sprinter, then I'd be trying to get the best time in the 100 meters. But because I'm kind of an entrepreneur, then that's why I was focused on money. Probably the first thing actually that I did, like as a business idea that I can remember, I think I was probably like eight years old or something. And basically, I was had just been playing in the local park.

• 4:02Speaker 00

  And then I found that there was this kind of seed on this tree by my house that you kind of opened it up and had all this like dust inside. And it was kind of pretty itchy if it got on you. And so basically, I just picked loads of them with my brother and I sold them in the playground as like itchy bombs. And so I told people like, put this down someone's back and then they're gonna get really itchy. And then, um, I think I sold each one for twenty five cents. And, um, yeah, I got quite a lot of like people from people's older siblings and stuff were coming to buy them for me in the playground and stuff. So that's probably the first entrepreneurial memory I can think of.

• 4:42Shaan Puri?

  Okay. Well, did you have a name for them or were you just calling them itchy bombs?

• 4:45Speaker 00

  I, yeah, I just branded it as like itchy bombs. Yeah.

• 4:48Shaan Puri?

  Okay. All right. So you started off with that, um, and slightly evil, but I like it. Uh, and so where did you go from there? You're eight years old then. And just to give people like the kind of context, uh, how old are you now?

• 5:00Speaker 00

  I'm thirty.

• 5:01Shaan Puri?

  Thirty. Uh, and how old do you look?

• 5:03Speaker 00

  Uh, probably like thirteen.

• 5:06Shaan Puri?

  I was trying to imagine you at eight and I was like, it's not actually that big of a jump from how, how I see it today. Uh, cause you gotta, you're sort of the baby faced assassin. So, so what did you try? What'd you try next? What were all, what were some of the other notable experiments or, uh, attempts that you made?

• 5:22Speaker 00

  Um, well, when I was, I think around twelve years old, all of my life I'd been getting not a massive amount, like a small amount of, um, pocket money, like allowance. I think about like two dollars fifty a week, maybe five dollars a week maximum. And then when I was like twelve or something, my parents said, okay, if you wanna keep getting your allowance, then you're gonna have to start doing more to help out around the house. And then so they said, all right, here's the stuff you're gonna have to do. You've got to do like dishes and like tidy up and et cetera, et cetera. And then so I said like, okay, well, why don't you, uh, I don't wanna do that stuff. So just stop giving me an allowance and I'll just figure out how to make some money myself.

• 6:05Speaker 00

  Um, so I was more valuing the freedom than, um, uh, the money.

• 6:10Shaan Puri?

  Right.

• 6:10Speaker 00

  And then so basically at the nowadays, they're, they're very popular. At the time it was slightly smaller, but these websites like Upwork. Um, which just IPO'd a couple of months ago, uh, like Upwork or um.

• 6:22Shaan Puri?

  E-land, yeah.

• 6:24Speaker 00

  Yeah. Um, so basically I just went on those sites and so as a worker, um, I bid on projects. And I bid on them even lower than like the guys in India and stuff.

• 6:36Shaan Puri?

  Right.

• 6:36Speaker 00

  Because I'm like twelve years old, so any money is a lot for me. And so basically I bid on projects that I didn't even know how to do them. And then basically I just learned how to do them. So basically people were paying me to learn.

• 6:50Shaan Puri?

  And so were you like, uh, were you like a naughty kid or what? Because I think most kids don't sort of look at their parents and say, no deal. When it comes to like the allowance for chores trade. And so you were willing to do work. You just didn't want to do that work. You wanted to do other things.

• 7:04Speaker 00

  I just, uh, yes, I wasn't really naughty. I just don't like being told what to do. I think that it's just something somehow in my personality. I mean, I can remember as well, I think I was age three or so. And I had a, let's say like a sippy cup, you know, like a baby's drink their.

• 7:22Shaan Puri?

  Yep.

• 7:23Speaker 00

  Milk out of these baby cups. And then so my parents were like, hey, you're getting pretty old for this now, so we need to get rid of it. And I was like, no, this is, I, this is, I like this. And so they're like, all right, what if we bought the cup off you? We'll offer you five dollars for the cup. And then so I remember thinking just like, wow, these guys are idiots. This cup is worth, wait, this is not worth five dollars. Like I'm, I'm ripping them off. And then so I was like, I did the deal and I was like, okay, you can take the cup and then I'll take five dollars for it. And so I felt like I was ripping them off. But then the next day I was like, uh, actually I wanna, I want the cup back. Can I just buy it back from you?

• 8:03Speaker 00

  And they're like, oh, we already threw it away. But I think like that kind of just shows that my parents, kind of even from a young age, just got the strategy that I didn't like being told what to do. But if it was like a business deal or something, then um, like I, I, I was like more rational.

• 8:17Shaan Puri?

  Right.

• 8:18Speaker 00

  My thinking, yeah.

• 8:19Shaan Puri?

  Nice. So the first acquisition offer was five bucks for the cup?

• 8:22Speaker 00

  Yeah.

• 8:24Shaan Puri?

  Very good. Okay, cool. So you started bidding on Elance. What type of stuff were you doing then? Because you're not an engineer, right?

• 8:31Speaker 00

  Yeah.

• 8:32Shaan Puri?

  Are you technical enough? Like, do you code at all?

• 8:36Speaker 00

  Yeah, so I'm like, I'm not an engineer. I'm just like a crappy engineer. So like, I can code some stuff, but like, if I was speaking to like a Silicon Valley engineer, then they'd quickly find out that I'm a fraud. But I can do like designing websites. Adobe Flash was big at the time. And so I knew like the basic stuff on that. Very crappy designer. So I could do like basic design stuff and then kind of like 3D modeling and stuff like that. Like, I'd take on any project and then I could like deliver it. It wasn't going to be great, but like I'd figure out some way to, you know, do a basic version of it.

• 9:15Shaan Puri?

  And what were you charging at the time? Because you said you were trying to undercut even the sort of cheap Indian labor. So what are we talking?

• 9:24Speaker 00

  Maybe like $100 to $250 for a project, which could take up multiple weeks.

• 9:30Shaan Puri?

  Okay. You've done so many different businesses. I know, I personally know of five different things you've done. What's your sort of formula for thinking of these like business ideas that you think might work?

• 9:40Speaker 00

  Yes, kind of, I mean, on a smaller level, like a hacky level is kind of exactly what you described. I was talking with someone else before and they asked like, oh, what's your favorite productivity hack? And I think like, I myself do this as well, but with kind of like over glorified productivity nowadays. Kind of have like a lot of productivity porn, like these articles saying like, you know, the best way to be productive is intermittent fasting and use this to do this app and blah, blah. I think actually most of the successes that I've had have actually come from when I've maybe been like procrastinating. Because I think you can have all the productivity tips in the world,

• 10:24Speaker 00

  but then if you're being productive, working on the wrong thing, then you're kind of being a busy bee, but with your head down, you know, not looking up to see what's around you. So I think that kind of allocating time or at least just not being embarrassed about procrastinating and discovering new things on the internet is so much.

• 10:47Speaker 00

  Just unlimited things to discover online. I think that is um is is how I discovered lots of opportunities for me is um whether it's just like reading different tech news. So like a lot of a number of breakthroughs for me have come just by one, reading tech news, but then like two, actually actioning on it. So if I'm reading news and I see something interesting, just reaching out to the company or building a relationship with the um.

• 11:15Shaan Puri?

  So so give me an example. Give me an example of one that comes to mind where you were sort of strategically being, you know, giving yourself open space. You were just browsing around uh maybe on the internet and something caught your eye. What what's what's an example?

• 11:28Speaker 00

  As you said in the intro, that I'd like founded Bungle and then um left around when we'd raised the series B sort of time. And I was planning to take some time off because I was pretty burned out, to be honest. So I was thinking to take a fair bit of time off. Um but actually, just one or two weeks after I left, um I was just reading Hacker News and then not the number one or two or whatever article that, you know, that those often get a lot of attention. But actually, on the second page of Hacker News, I just saw this post and it was two guys just saying that they were at idea stage and just test testing out um this idea that ended up

• 12:09Speaker 00

  becoming SHYP. Um and so I just reached out to them and I said like, hey, let me know if you just want any help with your pitch deck or whatever. I'm happy to be helpful. And then ended up meeting them and we got on really well and it very quickly spiraled within a matter of days that they were like, oh, do you just want to join as a co-founder? Um with hindsight, probably would have been better as an advisor, um because they had a very strong relationship together. They were living together and they worked together. So I was kind of a third wheel. But um it was a very interesting experience nevertheless. And yeah, that just came from procrastinating. I was just reading Hacker News, saw something that I an idea I thought was cool. And then um. Found the guy's email address and just sent him an email.

• 12:53Shaan Puri?

  I'm amazed you went to page two. I don't know anybody that goes to page two of Hacker News.

• 12:58Speaker 00

  Extreme procrastinating.

• 13:00Shaan Puri?

  Yeah, I mean, I go to the show tab on Hacker News where people are just showing a project they built. I find that way more interesting than just kind of people posting news or blog articles. Cause I want to see what people are making and they're just posting demos, basically, which is really awesome to check out. But that's kind of one of my secret, secret spots to go for kind of interesting stuff. I think over time I've figured out, you know, on Twitter, I got these lists that are like, these are my gems. Hacker News, the show tab, and I have like four or five of these different little, you know, it's almost like deal flow, but it's basically like just creativity flow where it's like, I go here and I get inspired one out of every 10 times. I find something amazing.

• 13:42Shaan Puri?

  And maybe nine out of 10 times it's just junk, but I need that versus just, you know, otherwise I'll just go on Instagram. And then that's sort of like junk food for my brain. And so I have these like little pockets on the internet that like I get cool stuff from. Do you have like, do you have pockets like that?

• 13:56Speaker 00

  Well, I mean, relevant to that is that Dropbox launched in the Hacker News show section. Drew Houston, I think he was a solo founder, announced his Dropbox idea in the Hacker News show section. You can actually still see the post online. And this is another bit to bear in mind is like, if you look on that post now, all of the comments are about how his idea is so terrible and it's definitely going to fail. People are like, well, why do I need this? I've got a USB stick. This is a shit idea.

• 14:27Shaan Puri?

  Yeah, this Dropbox thing is going nowhere.

• 14:31Speaker 00

  So if you had found that thing when he posted it and been contrarian and had your own opinion, instead of going on one with the crowd or telling him how terrible his idea is, you could have been his co-founder.

• 14:42Shaan Puri?

  Right. And you, I like how you just reached out of just like, hey, let me know if you guys need help. Uh, hey, let me know if I can be helpful with X. Because a lot of people I think want to reach out, but they don't know what to say. Do you have, you know, sort of, is that, is that typically what you do? You just sort of say, hey, this is, this looks cool. How can I help?

• 14:58Speaker 00

  Well, not how can I help? Because then, you know, that puts the onus on the other party to have to think for you. And then they don't know your skill sets and stuff. So for me, I was like, hey, if you need help with your pitch deck, because I knew that they were kind of trying to raise funding and stuff. And I, so I, my email was just like a few sentences like, hey, I started this fungal thing.

• 15:18Shaan Puri?

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• 15:57Speaker 00

  And had raised funding for that. And so I was saying, if you need help with your pitch deck, then I'd be happy to be helpful with that. And my intention was just to be helpful. I'd advised another company at that point, so I kind of thought, maybe they might want me to join as advisor. But then that kind of resonated with them because I was saying, this is my skill set. I can help with this. And then they were like, yeah, actually, we do need help with that.

• 16:22Shaan Puri?

  Right. And so, speaking of raising money, you have kind of an insane story about how you raised your money for Von Gogh. Like, talk us through that. So you, you start Von Gogh when you were how old?

• 16:32Speaker 00

  Probably 20.

• 16:34Shaan Puri?

  20. And so I'm guessing at 20, you didn't have some like, super impressive track record that you could point to and say, hey, trust me with your money. I've done this before, right? So you're basically

• 16:44Speaker 00

  Yeah.

• 16:45Shaan Puri?

  new to the, to the scene. You don't have a ton of connections and you don't have a huge track record. Is that all correct?

• 16:51Speaker 00

  Yeah. And especially in London, like the ecosystem is a fair bit smaller than in Silicon Valley.

• 16:57Shaan Puri?

  And so you had this idea, and how did you go about getting money for this?

• 17:01Speaker 00

  Well, in London, we just tried a lot of different stuff. We pitched at different events and just met anyone we could. One time pitched at an event and then this guy came up afterwards and was like, oh yeah, that was a really great pitch. Would love to get coffee with you guys. And then he gave us his card and it's like, blah, blah, blah, angel investor or something. And so we met up with him for coffee once and then we met up with him a second time. And then, you know, the meeting's kind of dragging on and stuff. And we're like, so like, how much money do you generally invest in companies when you're getting involved with them? And he's like, oh, oh, no, no, no, no. I don't invest money. I invest my time.

• 17:45Speaker 00

  So that was kind of our experience in London. Uh one of the one, we got one break, we got one V C fund who uh the two kind of associates liked what we were doing. There that was kind of rarity, like one, actually one of them. And then um they took us into a partner meeting, uh like or well, a meeting with one of the partners at at like six P M or something. And then after like ten minutes, the guy was like, okay, I gotta go now. Um yeah, this is cool. Thanks. Bye. Because basically we were like so terrible at pitching or you were so terrible. He basically walked out after like ten minutes.

• 18:18Shaan Puri?

  And were you like devastated or were you fine?

• 18:20Speaker 00

  Yeah, yeah. Oh, yeah, yeah. We were pretty devastated. We also had like, yeah, had a lot of weird experiences in London. One other guy, he was just getting started investing, I guess, and he like rented two conference rooms at like a hotel or a bar or something. And he wanted to interview my co-founder and I in separate rooms. And and we were like, dude, why, why did you spend money, like renting these conference rooms? You don't need to impress us. Like, what were you doing? And why are you interviewing us in separate rooms? Super weird. And then he was like, oh, I want to invest a million dollars. And then the next day, he's like, oh, actually, I changed my mind. So all this like, yeah, it was um not a very established ecosystem in London at the time. I think it's got better now, but um.

• 19:03Speaker 00

  Yeah, we were having a very tough time raising funding. And then basically the big breakthrough came again just because I was actually procrastinating. So there was stuff that I was supposed to be doing at my company. But instead, I was just slacking off and reading TechCrunch. And I saw this article and it said, there's this new incubator or accelerator in in Silicon Valley called AngelPad, and they're giving every company that joins um a hundred and twenty thousand dollars. And then at the bottom, it said like, oh, and they have kindly reserved one spot or kept one spot for uh TechCrunch readers. So if you're interested, just like apply here. Um and I said to my co-founder, like, hey, look what we're doing with no money.

• 19:46Speaker 00

  Imagine what we could do with a hundred and twenty thousand dollars. We should apply. And he's like, oh, you know, it's that's gonna waste of time. It's not worth it because they were saying they had like two thousand applications for this last spot or something. And I was like, come on, we might as well just give it a try. Like, there's not much to lose. And so he was like, okay, you just give it like three hours max, and then if not, then we'll just move on. Um. So basically, just recorded a video on my phone of my co-founder and I just talking to the camera. Like, Tomas, seen your background, you're a legend. We said this last spot, we're gonna let you down. This is my phone number, this is my email address, give me a call. And then basically, again, kind of from procrastinating, I'd found this kind of loophole hack on LinkedIn.

• 20:29Speaker 00

  And where I was able to create an advertisement and target it down to a specific person. Um. So LinkedIn has its kind of own ad system like Google AdWords. But they, I think it was a software engineer, like, I think some software engineer had done this as a bug. That I found I could set the targeting so specifically, say, like, job title, Angel Pad. Job title, CEO, that there's kind of only one person who that ad would show it to, you know.

• 20:57Shaan Puri?

  And wait, so how did you find that? You said you just like, you stumbled into this?

• 21:02Speaker 00

  Yeah, so I was basically just, um, LinkedIn had launched a new ad system. And um, I think this is where the most opportunities are, is when it's like a nascent platform. Um. If you're trying to find hacks on Google AdWords, there's probably none left. Because, you know, people have like fifteen, twenty years' experience with Google AdWords, you know, and they've got loads of engineers working on it. LinkedIn, this ad system was new, they'd just launched it. And so I was just testing it out, like, oh, let me create an ad. And then it had this interesting feature where you created um, an ad. And you set your targeting, like company app or job title or whatever. And it told you on the right how many people your advertisement would reach. So like a hundred thousand people or like fifty to hundred.

• 21:46Speaker 00

  But then this actually, at a very low level, uh, so I just thought like, oh, what happens if I create an ad targeting one person? So the number on the side said one. And I tried to submit the ad. And then, as you might expect, it said. Oh, your ad is not targeting enough people, so you need to target a wider audience. Because um that makes sense.

• 22:06Shaan Puri?

  Yeah.

• 22:07Speaker 00

  Like, why would they let you run an ad?

• 22:09Shaan Puri?

  Right.

• 22:09Speaker 00

  Yeah, I mean, why would they let you run an ad, run an ad targeting one person? Um, but then, again, just because I was just in curious, I guess, and I like just like trying stuff and breaking it. I was like, okay, well, what happens if I expand the targeting enough to make that number now say two people? So I tried again to submit an ad that targeted two people this time. Again, it was like the this audience is too small, like increase it. And so I kept on doing that one after another. And then basically found out that it would let me submit an ad when I had an advertisement targeting only seven people. I don't know why seven was the number again, probably someone pushed the wrong. Perhaps they meant it's seven thousand people and they only put seven by mistake.

• 22:54Speaker 00

  Um, but yeah, so armed with that knowledge, I could now create an ad targeting the one person who I did want. And then I would put in six randoms who I don't care if they saw the ad. Or maybe wouldn't even understand it, even if they did see it. So maybe like a job title, like janitor at like a Chinese bank or something, you know, like in China. So it doesn't matter if those six people saw it.

• 23:18Shaan Puri?

  And what so so what did you do with this ad?

• 23:21Speaker 00

  Uh, so I created an ad targeting all of his friends and our connections on LinkedIn. So basically, again, I'd seen this tech crunch post earlier in the day. Only spent like three hours doing this, um, creating an ad targeting all his connections saying, and. I also found another hack on LinkedIn ads, which was basically at the time, because it was new, all of their ads were manually reviewed. Like they didn't have like all eternity reviews and but the thing is that you could update the ad after it was approved. So basically, I would create like an innocent looking ad, um, just targeting whatever. And then I'd change it after they approved it. Um, because otherwise they wouldn't have approved it. So basically, the ad said, um, it had a picture of the founder of AngelPants face. Uh, and it said, do you know Tomas?

• 24:05Speaker 00

  We've got an urgent message we need to get to him. Click here. And so you click it and it took it to a one page landing page. And it's basically got the video, again, us talking into the camera, um, saying, oh, we researched you. Really want this last spot and I put my phone number and email address and I put a button just saying quickly to email this to Tomas. Um, and then England's different time zone to America, obviously, um, basically just went to sleep. Didn't really expect anything to come from it, um, just gave it our best shot and then was the next day. I kind of forgot about it to be honest. And then the next day I just came into the office and then I had an email, just a one line email um, from Tomas. And um, it it just said like, uh, I've seen your ad, uh, what's your phone number?

• 24:52Speaker 00

  Um, and then so he phoned me and he's like, hey, is that Jack? And I'm like, yeah. And he's like, well, I've seen the ad, we can chat, but first of all, take it down now. He's like, everyone's calling me about these ads. He he told us later on that he'd been on a flight from New York to San Francisco. Got off the plane, he had like close to twenty emails from people. I'm saying like, hey, have you seen this ad ad? Uh, people, these young kids, they like really want to speak to you. Um.

• 25:17Shaan Puri?

  That's amazing. So so you didn't, so so this uh, this is, you know, lesson number fifty two of my first millionth podcast, which is, don't just put your resume on the desk. That's not enough. Um, you didn't just apply to AngelPad, just like the other two thousand companies. You applied and then you spent a few hours kind of messing around, trying to get this guy's attention, trying to stand out.

• 25:38Speaker 00

  Yeah.

• 25:38Shaan Puri?

  And uh, in a way that I feel like literally only you would have done. You target the ad, you figure out that you can target to seven people. You put his face in it and it says, you know, do you know this person? If so, click this thing. And uh, and you got his attention. He might have, was he annoyed or was he uh, like, was he impressed or annoyed or a mix of both?

• 25:57Speaker 00

  Uh, I think a mix of both, yeah. Um, he was like, take it down, it's causing those trouble, but yeah, you guys are like hustling. You really want this and you're obviously, as you said, like going, uh, putting in work and thinking outside the box.

• 26:10Shaan Puri?

  Yeah, when I, when I moved to Silicon Valley, I was in Australia at the time. So sort of like you on the outside of the bubble. And I wanted to work at this place called Monkey Inferno, which was Michael Birch's incubator. I was like, wow, this guy's like billionaire. He's built and sold multiple companies and he's got this amazing place where he looks like he just bought a building, decked it out and he's, it's an idea lab where you know, sort of like any idea you want, you can come and work on it here. So I thought that was amazing. But I looked at the job description and it said, like you, you were hiring a product manager. I didn't even know what that was. And it said, you know, you need seven years of product management experience. I didn't even have seven minutes of product management experience. But I applied and then I was like, okay, there's no way they're going to just like pick me out of the bunch.

• 26:51Shaan Puri?

  So then I made a custom website about, you know, why I'm the guy for the role. I wrote a letter to him. And then even that got me a meeting and then, then they kind of blew me off and I started just doing the job, even though they weren't asking me to. So I would look at all the products they built and I would send them like a PowerPoint saying, hey, here's how I think this product could be improved. And I just started, started doing the job and that was the only, I only was applying to one job. I didn't like, I didn't apply to any other jobs. I was like, I'm going to get this job and I'm going to go further than anyone else. And it sounds like that's pretty much the principle you were using to get into AngelPad.

• 27:23Speaker 00

  For sure. Yeah. I mean, I'd never even heard of Y Combinator. We didn't even apply to that. Like we didn't apply to anything else.

• 27:29Shaan Puri?

  And so you, did you end up getting in? Did you end up getting the, the funding from them?

• 27:32Speaker 00

  Yeah. So, um, basically I said, like, had seen the TechCrunch post on a Thursday, had to call with him on the Friday, the next day. And then over the course of the next week, we had, um, maybe like one or two more Skype calls. Um, at the time it was only my co-founder and I, and we had two or three interns, um, in the office. And then so a week after the initial call, he said like, okay, guys, uh, I, I made my final decision. Um, oh, and by the way, like when we done the other calls, we told every other company in AngelPad at that point, were amazing software engineers. Uh, most of them were from Google. One guy had written YouTube's API. These other two were like, had PhDs in video encoding. Um, and so we knew that was a weakness that we didn't fit in at all.

• 28:15Speaker 00

  But what we told to Mars is we said like, hey, look, you've got 11 other companies, all like heavy software engineering backgrounds and you've got one last spot. And we were like, why didn't you just choose us as just like a wild card? Like, it could be an epic failure or it could be a massive success. Uh, so that was our pitch is like, we know we don't fit in, but at least we can be a wild card.

• 28:36Shaan Puri?

  So you turn your weakness into a s- a strength, basically.

• 28:39Speaker 00

  Exactly. Yeah. Um, we were like, your other things that we were like, your other companies, they're all really safe bets. And why don't you just have one wild card? And so a week after he was like, all right, I've made my decision. Who's got the final spot? Let's have a final Skype video call. And we were like, oh, man, can't we just do a phone call? Like, we've got our interns here. But do you have to reject us on video? And he's like, yeah, we've got to. And so we're on the call and then he's like, I've made my decision. I'm I'm gonna take a risk and go for a wild card. Like, you've got the last spot. And we're like high fiving around the office. And he's like, but if we do this, then I've invested in like foreign companies before. And then after the program, they just like move back to their home country. And our investors don't like that. So if you're gonna get the last spot, then you have to move to America permanently.

• 29:24Speaker 00

  And my co-founder and I, we didn't even need to look at each other. We've not even discussed that at that point. We were just like, yeah, yeah, yeah, no problem. That's fine. And he's like, okay, then. Well, um, the program starts on Monday, so just book the first flight out here that you can. Um, and so like two days later, I think we just um got on the plane to San Francisco.

• 29:43Shaan Puri?

  Amazing. And that's the company that turned into Vungle, which is the

• 29:46Speaker 00

  Yeah.

• 29:47Shaan Puri?

  sort of monster of like, how many people work there now?

• 29:49Speaker 00

  Um, over two hundred, I think. Yeah.

• 29:52Shaan Puri?

  And so what was the pitch at the time? Uh, because we haven't really been talking about the idea. I'm, you know, I'm more interested in your sort of clever hacks and your hustles of how you get what you want. I think that is really the more interesting piece to me at least. But like, what was the idea? Was the idea at the time, we're gonna be a mobile ad network? Or was it?

• 30:09Speaker 00

  The the idea was terrible. It would never have actually worked. Um, surprised that we actually, as I said, we got in not because of the idea or our backgrounds. Um, it was just because of our hustling. The idea was terrible. It was an app store where across-platform app store, where every app would have a video showing you how the app works. So it was like an Android and iPhone and PC app store. Um, wouldn't have, it never actually worked. But basically, when we got to AngelPad, he gave some advice which really was very compelling. And he basically said, I, he said this to all the teams, but we kind of took it on most. He said like, all right, I want you to call like twenty prospective customers of yours.

• 30:53Speaker 00

  And don't pitch them your current business idea. Instead, talk to them and ask what is their biggest problem in their current like day to day role, like in their life. And so we spoke to different app developers, we went to app developers to meet ups and stuff. And we asked them, what's your biggest challenge? And they told us, oh, we're app developers, we know how to build an app. But then we don't know how to do the marketing or how to get users for it. And basically, how AngelPad works is they have a demo day. So the whole program lasts for twelve weeks. And at the end, you have a demo day where you pitch to investors, give a presentation. And so basically, there was actually only two weeks left. And we knew what we needed to do. We needed to come up with a new business idea.

• 31:38Speaker 00

  We needed to recruit a CTO, because neither of us could code. And you kind of need a CTO type person to raise funding. And we needed to raise at least some funding. Otherwise, we would have had to go back to England, because we were only there on a tourist visa anyway. And so two, roughly two weeks before the demo day, what we did is we just came up with like six different business ideas related to this idea of how can app developers get users? And we, we spent like half an hour each, like creating a super crappy landing page for each one. And basically, we just spent a day trying to actually sell each idea. So the first idea we were like, oh, we can help you get distributors on to different blogs and get them to like cover your app.

• 32:23Speaker 00

  And then we were like, normally, this is going to be two hundred dollars, but we'll give it to you for like twenty dollars this Thursday. Met up with loads of different app developers and stuff. Everyone was like, wow, this idea is amazing. Um, yeah, I'll sign up when I get home. We didn't get a single sale. Like, people just were telling us it's a great idea to get us to go away.

• 32:40Shaan Puri?

  Right.

• 32:41Speaker 00

  And so we tried a different idea each day. And then the final day, we actually came up with the idea, I think, I'm not sure for certain, but I think that how we came up with the idea for Vungle is that. We had been trying to record a meeting that we had with one of our like um uh like with Tomas. That's you can manage pad where he was giving advice and we were like is that okay we record this meeting? We opened the app and then this like crazy like Verizon or Coke like video ads started playing really loudly. And we couldn't mute and it was like really annoying and um but then we thought like, oh, wait a minute. Instead of advertising like Coke or something, why don't we have the video advertising another different game?

• 33:23Speaker 00

  Um and so we kind of again, we hadn't we hadn't written a single line of code, it was new draft of uh engineers. But we spoke to app developers and we're like, all right, what if you could have like a movie trailer for your app? Like fifteen seconds and then when another person, when a gamer is playing a different mobile game. Um they could see a trailer for your app and then people, we we knew we'd hit the right idea at that point. Because people were basically like, oh, wow, I need this so badly. Like, I want to be your first customer. Like, they knew it hadn't launched yet, but they were like, I want to be first in line when it launches. Like, put me down to like five thousand dollars, uh ten thousand dollars. Like, people were throwing money at us. Um even though we hadn't got a product. And so that's when we knew we'd got the right idea.

• 34:03Shaan Puri?

  And so, I mean, is that like, is that real? I mean, the people were were that excited? I mean, why were they so some like differently excited about that than the other one? And I guess like, um, how do you know or how did they know that, yeah, this is gonna get me customers? Or what was the difference, I guess?

• 34:19Speaker 00

  Well, the first one, it's not really getting any, like, helping them get onto a blog or something. That's a nice to have. So one other investigator's advice that also, uh while we're coming up with the idea, that also raised a debate. He said, don't create a business where you're curing your customers' itch. Like, if you don't exist, they're like, oh, well, it's just an itch. It doesn't matter. Like, your your that your antidote for my itch is nice, but, you know, whatever. He's like, create something where it cures your customers' cancer. And so for them, getting onto a blog or reviews or something, that's not really users. Um having um. Uh like a uh an ad network with video that would drive them actual users.

• 35:04Speaker 00

  And I think they got the idea more because we compared it to the the current industry incumbent. At that time, the only real option for mobile games was banner ads. And so we said like, look, a banner ad sucks.

• 35:17Shaan Puri?

  Right.

• 35:17Speaker 00

  Like, they don't get what your game does. It's a tiny banner. The users click on it by mistake. They didn't even mean to click it. And they don't even know what your app does. If you're gonna have a fifteen second video, it's like a movie trailer, like they're gonna see what your app does. And so um that will be a much better way to get users, you know. And um five thousand dollars also, even though it's throwing money at us, it's not that much money. They basically were willing to try anything that could potentially give them users. They weren't committing a million dollars. They were saying, oh, yeah, we'll we'll try this out when it launches. We'll we'll for sure give you like five thousand dollar test budget. Um so, you know, it wasn't a massive hurdle, but what we were selling at that point was users. Um they didn't, like a nice to have was blogs.

• 36:02Shaan Puri?

  So they were already advertising. It was, but it was crappy banner ads and they were thinking, ah, this is like, we can't show them how fun our game is through this little banner. And what you guys brought to the market was the video ad so that they could make a little, you know, a juicy trailer and they were like, okay.

• 36:17Speaker 00

  Yeah.

• 36:17Shaan Puri?

  I believe more people will come to us than we're currently getting if we do the video.

• 36:21Speaker 00

  Yeah. The other bit, uh to bear in mind as well is Tomas, uh the AngelPad guy, actually had worked at Google um for many years. And so we were coming up with all these different ideas and so we met him during AngelPad and again, we were super layman. And so just, I remember drawing on the whiteboard like, I I've done some brief reading online. I think this is how mobile advertising works. Like, it's like you have an advertiser. Basically, he he was also, this was like a practice investor pitch, so I think he was kind of in the acting mode a bit. We made him feel guilty about it afterwards. But basically, there was another investor sitting there as well. Basically, he stood up during the pitch and he's like banged on the table and he's like, you guys don't know anything about advertising. There's people with like twenty years' experience at Google working on this.

• 37:04Speaker 00

  And you just looked this up on the internet like five minutes ago and you think you can come up with better advertising company? You will never raise a single dollar of funding. Um and so we kept reminding him about that. Um but the reason they worked is it was actually an advantage that we didn't know anything at all about advertising. Because what it meant is that we looked at things. Just through the lens of the customer needs. Um. So at the time, the industry standard for mobile advertising was it was charged on a CPM basis. Cost per mill. And that means cost per thousand people that view an advertisement, whether that's a banner or a video. So it was like, let's say like two dollars per thousand people that see your ad.

• 37:50Speaker 00

  And we were thinking, we just thought about this through the lens of instead of thinking like, oh, this is just how everyone in the industry does it. This is the rule. So I guess we should follow it. We thought back from the needs of our customer, the app developer. And we just thought like, wait a minute, they don't care how many people see the video. They just want users. And so it was a risk like, uh, it could have totally not worked. But we said, all right, instead of charging CPM, we'll just charge you, you just pay us for each user that we get you.

• 38:21Shaan Puri?

  Mm hmm.

• 38:21Speaker 00

  So just pay us like two dollars for every user we get you. It doesn't matter if we get you a user after they see your video once, or like a hundred thousand times. Um, we were just trying to charge you based on how many users we get you. Um. And then that again was a massive differentiator for us and it became because we were naive. And, um, you know, if we had more experience, we could have just said, no, this, you know, this is the rules, I guess.

• 38:47Shaan Puri?

  Yeah, I love that.

• 38:47Speaker 00

  Everyone does it this way, so.

• 38:49Shaan Puri?

  Because it's it's so simple and it's, um, it seems obvious in hindsight. But for sure, I mean, that's the way the industry worked. That's the acronym. Everybody knows CPM. And so if you had come at it from the advertising background, you would have taken that for granted and just continued on as is. And so how did you, uh, you left the company at a certain point, uh, was that just, you know, was it, you know, founder tension? Was it you were tired of it? Uh, you vested all your stock? What was the reason you left?

• 39:16Speaker 00

  Um, lots of different reasons. I think like, uh, as humans, we like to have a very simple and, um, clean explanation or story to lots of stuff, right? But, um, like there's lots of dynamics going on in a company. Um, I think that for me, it was like various things. Um, one is that after putting in all of this effort, getting to AngelPad and then during the program, like basically sleeping in the office and going all in and not having any weekends or holiday. Um, I was very burned out at the end, um, and I think not, you know, I was very unhealthy and not in a good frame of mind, really, because I'd just gone all in on my company.

• 39:55Speaker 00

  And then the important thing as a company scales and you get more and more people is um the founders also need to scale as well. So when there's two of you, you need to do everything. You need to be the company janitor, the company accountant, the company office manager. Everything. So throughout the time of the company, I was doing everything, like marketing, product, all this. And then as the company scales, you kind of need to fire yourself from those responsibilities and. Uh hire people to take them over from you and you become very focused on what you're good at. The the conventional wisdom that's given a lot by investors and and stuff like that. They give out, they say there's certain rules, like Silicon Valley rules. They say like, oh, you should never invest in like.

• 40:39Speaker 00

  Family teams. You should never invest in husband and wife teams. You should never have one founder be CEO. And one be president because then there's not clear line of control. People get confused. And so I kind of um. Didn't really take my own advice about breaking the rules. I kind of just accepted the Silicon Valley norms everyone's telling me. It was only after I left the company um that when I researched, at the time, there was only about twenty unicorns. Um so companies worth over a billion. Now there's loads. When I looked at them, pretty much every single one broke one of those rules. Um Eventbrite is was a husband and wife team, um Stripe, they are brothers.

• 41:20Speaker 00

  Um Lyft, one of the co-founders is CEO, the other one is president. So kind of. There is no rules in Silicon Valley, but at the time I kind of went along with what different investors and stuff are telling me.

• 41:31Shaan Puri?

  Gotcha. Okay, that makes sense. I I appreciate the sort of the nuance. And so so when you left, you know, at one point you. Um you know, the company's doing really well, but you personally sold a little bit of the stock. Explain to people who have never been in that position where. You have this paper net worth that's, you know, you've it's worth something, but the company's not liquid yet. And so how did you think about that? And how did you how did you actually do that? And to to walk us through how that works? How do you do? How do you sell secondary stock?

• 41:57Speaker 00

  Yeah, so I uh I mean, investors often don't want, when you're still working at a company, they probably don't want you selling stock that much. Um it's become a bit more normal, but they don't want to do it that much because they want you to be incentivized and like hungry to get an exit. So that they can make money as well. You know, if you sold a load of your stock, then you're probably just gonna be more like, oh, just. Not in any rush to sell, but they they want you to be hungry. But because I'd left, then um the company was a bit more amenable to it. And so. Um, you know, I could do with having a bit of cash to survive on a day to day basis. So my co-founder, who was still there, just said like. Oh, hey, well, there's these other investors who want to invest in the company, but we don't really want to raise investment right now.

• 42:41Speaker 00

  Would you be interested in selling a small amount of your stock to them? And then so I said like, okay, yeah, that sounds like a good arrangement. And then the company was all on board with it because um it was only a small amount and. It wasn't gonna be more dilution for everybody. And so basically just chatted with these guys and it was fairly simple. That I just sold a um small amount that we kind of just went back and forwards, agreed a rough valuation. And then um like uh just sold a small amount at a kind of reasonable valuation for both parties.

• 43:12Shaan Puri?

  Gotcha. And so how how did you decide, you know, how much you wanted to sell? Uh did you want to do investing and. Uh you know, create other businesses or or invest in real estate or something like that? Like, how did you?

• 43:22Speaker 00

  No.

• 43:22Shaan Puri?

  What did you do? How did you think about the money there?

• 43:25Speaker 00

  Uh I was just thinking, um I didn't I didn't want to take money to do investing because I also was confident that the company valuation was gonna keep going up. So I kind of just thought like, what's the minimum amount that I'm gonna feel comfortable the next few years, at least just not have to worry about how I'm gonna pay my rent? And stuff and um not have to be forced to try and get a salary somewhere. So I kind of just thought like, let's say that the average Silicon Valley salary is like. I don't know, eighty, a hundred thousand dollars or something. I just bought like, all right, what's a few years of that kind of salary range that would give me some money to live, but I'm not selling, I'm still keeping, you know, like ninety five plus percent of my stock.

• 44:06Shaan Puri?

  Gotcha. Okay. And you, you, you wanted to continue to ride that upside. So you found the

• 44:11Speaker 00

  Yeah.

• 44:11Shaan Puri?

  balance that worked for you.

• 44:12Speaker 00

  Yeah.

• 44:13Shaan Puri?

  Love it. Uh, cool. And the last question I have for you is, again, I think you are one of the most clever and sort of outside the box thinkers. And it's funny, funny having you on a podcast. And in general, you do a great job of meeting a lot of people. I feel like you meet a lot of entrepreneurs, either through the internet or in person. But you're actually kind of a introverted guy. You're not the sort of loudest guy in the room. And so I was, I, you know, I wanted to have you on so that you could tell your story. But also, I think a lot of people can learn from you. The one thing I wanted to know is if you were twenty years old again today, and you take out Vungle, and, you know, you don't have that stock that's going to be worth all this money, and you were trying to make it again, you were trying to do something new, what would you, where would you gravitate

• 44:56Shaan Puri?

  towards, you know, if it's a specific project, that's great. But even if it's just a certain space that you're interested in, what would you do if you were twenty years old again today?

• 45:04Speaker 00

  I would be, again, like, reading tech news, like TechCrunch or Hacker News or things like this, and then seeing what new platforms are launching. So let's say like you had your Blab platform, right?

• 45:16Shaan Puri?

  Yep.

• 45:17Speaker 00

  Even after Vungle, one bit I did is I saw Product Hunt. It launched, had, I think, under two hundred views or something. I was like, oh, this just seems pretty interesting. And then I just started using it every single day. I just would post new products to it every single day. So, you know, a few minutes of work each day. And then quickly, I just became the number one user on the site. And they had like a ranking board. And then Product Hunt just got more and more popular. And then nowadays, it's like a very established thing. But I had just started very early, and you're only allowed to post one product per day. So kind of I had a head start that nobody else could catch me up with, as long as I consistently posted each day. And so

• 46:01Speaker 00

  I just posted each day and I made it a bit more scalable. Again, I'm a crappy software engineer. If I was doing this again, I would just hire some offer up work, could probably get it done for like ten dollars or something. I basically um did this myself, but I could have hired someone for ten dollars. I created um just a script to um automatically schedule um a post to product time each day at exactly midnight. And that's when the leaderboard resets. And then basically I just had a massive list of products and so I didn't have to do any work. It would just post to product ten each day. And I'm I'm was the number one user and so nobody else could catch me. And then because there's a leaderboard, I'm kind of getting free advertising, if you like, on the homepage. And then um a number of people kind of found me on there and were reaching out. Um.

• 46:46Speaker 00

  Sequoia is pretty much like one of the best known VC funds in Silicon Valley. Uh one of the partners from Sequoia just reached out to me and asked like, hey, can we get lunch? Um just because I I I think he just found it interesting, like, why is this guy so prominent on there? Um and I did the same thing with, so Product Hunt has become popular. I also did, it was some other platforms, one was called Whale. It was like a question and answer site. That one ended up dying. Um but you know, if you place enough bets in different places, then one of them might take off. And because you're one of the early users, you know, the early users of YouTube nowadays are like hundreds of millionaires, right? Um so that's probably what I do is like, uh that doesn't cost any money at all

• 47:29Speaker 00

  to become a power user on a platform that is new. And so you have a good opportunity of becoming a number one user. And then when you've got that, you can leverage that. You get connections. Because I was on Product Hunt, many startups reach out to me all the time, like pitching me, asking, can you have me go on to Product Hunt? And then I could have like asked them or transitioned up to be an advisor at one of the companies. Or if they seemed interesting, try and be a co-founder, um the same as happening with Ship that I described. So something like that.

• 47:56Shaan Puri?

  Hmm. Jack, this is why you would win the game show. You are quick to sort of find the exploits. The platforms that are fast and new and fast, fast growing and you jump on. I like that. Very good strategy. And it reminds me of a framework that I have, which is you don't always have to. So some people look for windows and some people look for doors. This is what I like to say. A window is something where you can see through it. You know exactly what's on the other side and you can decide is this worth my time or not? And it's good to look through windows, right? You want to look at opportunities and say, is this going to be worth it or not? But sometimes you got to open doors and you don't know what's behind the door. But as long as you're reasonably confident that this door leads to four more doors, it's worth going through. And so I think there's a lot of people out there who look for windows. And anytime they see a door, they get a little bit scared. They don't want to open it.

• 48:40Shaan Puri?

  And it's advantageous to be a door opener and just keep opening one door that opens four more. And it sounds like, you know, what you do with product on is exactly that.

• 48:49Speaker 00

  Yeah, exactly.

• 48:50Shaan Puri?

  Hey, so listen, man, we're gonna, we're gonna hop off, but I wanted to give you a chance to give people a way to follow you, to contact you, to check out some new stuff you're working on. This is your opportunity to kind of shout out. How should the people who are listening to this? How should they, you know, get more Jack Smith in their life, which we all want?

• 49:06Speaker 00

  Yeah, my website is just jacksmith.eu. I've got a blog up. I haven't posted it in a while, but maybe if more people reach out to me by that, then I can start posting more, I guess. But that's probably the best way to find me and then the links off to my Twitter and stuff like that from there.

• 49:22Shaan Puri?

  Awesome. Great, Jack, man. It's good talking to you and I'll see you soon when you're back from New York after the summer.

• 49:28Speaker 00

  Yeah, absolutely. Thanks for having me on and best of luck. I'm looking forward to see who else comes on the podcast next.