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Scott Paul

Scott Paul describes the Utah angel investing ecosystem, and his role as a Founder of Convoi Ventures, an $8M rolling VC fund here in Utah. He's helped turn Utah into a thriving startup culture and he is a supportive leader and angel investor. Utah has a strong entrepreneurial spirit, with a growing number of startups and small businesses emerging in recent years.

VC Insights: Scott Paul on the Growing Utah Ecosystem

Scott Paul describes the Utah angel investing ecosystem, and his role as a Founder of Convoi Ventures, an $8M rolling VC fund here in Utah.

He’s helped turn Utah into a thriving startup culture and he is a supportive leader and angel investor.

Utah has a strong entrepreneurial spirit, with a growing number of startups and small businesses emerging in recent years.

Angel investors are a critical component of the Utah startup ecosystem, providing seed funding and mentorship to early-stage companies. These investors are typically high-net-worth individuals who invest their own capital in promising startups in exchange for equity.

Utah has several angel investor groups, including Salt Lake City Angels, Park City Angels, and Utah Angels. These groups offer a range of resources and support for startups, including funding, mentorship, networking opportunities, and access to a wide range of industry experts.

In addition to angel investor groups, Utah has a number of venture capital firms that specialize in early-stage funding. These firms typically invest larger sums of money in startups that have already demonstrated some level of success, such as a working prototype or a small customer base.


Overall, the Utah angel investing ecosystem is highly supportive of startups and is known for its strong sense of community. With a growing number of investors and a vibrant startup culture, Utah is becoming an increasingly attractive destination for entrepreneurs seeking funding and support for their new ventures.

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Episode Transcript

Jon: All right. So welcome back to the Venture Capital podcast. Before we invite our introduce our guest. Peter and I were talking about what we want 2223 to look like, and I think our elevator pitch is we want to be very raw and unscripted, like very much, very unfiltered. We're going to do our best to protect the confidentiality information of the show.
 
Jon: But wherever possible, like we want you to know, like the behind the scenes dirt. Is that a fair fairway, as I had that conversation about Peter? Yep. You said it more succinctly, much more succinctly. And we're going to start bringing guests on for the podcast this year. So Scott, Paul is the first guest and we'll talk about his background.
 
Jon: Maybe I'll talk about Ralph. So Scott, Paul has sold two, three companies. I mean, yeah, there's.
 
Scott: There's ones that.
 
Jon: You were.
 
Scott: Elaborating.
 
Jon: Elaborating that you were operating two or three was the official number two or three armor active? I mean, there's.
 
Scott: Selling and then there's exits.
 
Jon: I exited to Disney.
 
Scott: So to that I'm like, Yeah, that worked out okay. Others that and like, great sells.
 
Jon: Okay. And since then he's been the most active angel investor in this day. I don't have the actual data, so but I would think so.
 
Scott: Up there.
 
Jon: You're doing more deals very high. Who's more active than you? Brandon FUGAL I.
 
Scott: Think.
 
Jon: Kirk Wieman. Kirk We met because he just puts.
 
Scott: Everything into everything on the angel list. But I think in Utah I'm pretty hyperactive.
 
Jon: Yeah, Yeah. So I mean, like.
 
Scott: Richard's family might be like Tyler and John or Pretty.
 
Jon: Act, but I think you do more deals than he does.
 
Scott: I think Jeremy Andrus is.
 
Peter: And I wasn't saying I think.
 
Scott: Jeremy Lederer Anybody I don't think he's active, like he's not doing it. But Aaron.
 
Jon: All I know is I think John Richard said you were the most active from his perspective. That's cool. Okay, I'll take it. So.
 
Peter: So one of the most active. All right. We can all agree on that.
 
Jon: Also for legal reasons, this podcast is not financial legal accounting advice. I am not an investor. And it was Scott or his his venture fund. Anyone else want disclose anything? Peter, you an investor?
 
Peter: I'm a proud investor in company.
 
Jon: Awesome. All right. And also he has a VC fund that he launched called Convoy Ventures. So with that, let's kind of dig in. So we're not going to talk about how you already sold a couple of companies want to Disney. We are going to talk about like what is the genesis of convoy? Why did you start it? What is this whole focus on?
 
Jon: Like what is Pre-seed capital, stuff like that? And so I'm the moderator. We got two technical experts. So like, let's dive in.
 
Scott: Here to are we the technical.
 
Jon: Experts? Yes, I'm not a VC, I'm not an active investor. I used to be. okay. I met you.
 
Scott: When you were when I was an operator and you were actually acting as.
 
Jon: VC. Correct. Launch up. Yeah, I know you two angels. Before that you came and pitch and you showed us your revenue numbers. You told company, I have armor, I've got enclosures. Yeah, I think it was you pitched as iPad enclosures. Weren't Osborn I would've been early. Looked like he was fairly interested by you. The deal my big I was frustrated with that group because they weren't doing deals.
 
Jon: So you would have deals that I thought at least deserve a look. Yeah. And they would just come pitch, leave, campus leave. And that's what I felt.
 
Scott: Watching some of them too. I didn't feel like those angel groups really were decision makers. I felt like it was kind of get together, eat some steak and, you know.
 
Jon: Phil and Phil and make fun of companies really? Well, just like, not like it was something to do. Like the company you come, you pitch, you then leave. Yeah. And they're like, you know, have you feel great as an investor? I can do this deal.
 
Peter: Look at me. I'm so smart. I can give you all the reasons why they suck and will fail. Which.
 
Jon: But they weren't.
 
Peter: Let's be honest. Like, that's it. That's the easiest thing to do.
 
Jon: It really is, right?
 
Peter: Like, I can. I could kill any single day exactly. Out there, period. But it gets a lot harder when.
 
Scott: You're open to everything. I'm like, every day is hard because you got to scrutinize. Not every deal is a deal.
 
Peter: It's a tough balance.
 
Scott: But I like to leave entrepreneurs encouraged by something if they have something to be encouraged by. I'm definitely trying to encourage them to get that. And so almost every idea you hear, every deal has something you can benefit them by telling them versus just like, we're going to pass and no data. Like, that's so frustrating when and these groups just listen to you and then give you zero good stuff to work with.
 
Peter: Yeah, but it's hard, right? Because I know sometimes entrepreneurs don't want to hear it.
 
Jon: Yeah, they don't.
 
Scott: Most of them don't.
 
Peter: They just want to argue with you. Yeah, My, you're wrong.
 
Jon: And that's good.
 
Scott: Because then you can hear then, like in that argument I think is when they, when you really feel the that's the real pitch is in the back and forth. Yeah. You start to you start to find out if they have it and I get they going to be able to weather it all.
 
Jon: Is it appropriate to argue with a VC. yeah, for sure. Yeah. Okay. And you're the.
 
Scott: Customer. In my opinion, the entrepreneur is the customer. And so they can how they should be able to open the complaint, take it, you know, go back and forth until their issues are settled.
 
Jon: If you want to.
 
Scott: Be a really good VC, you should be able to see value in talking to your customers. And that's to be even perspective. Customers are entrepreneurs that you're there before you've given them any money. And so they're still in a pipeline. They're still very important to your overall, like flow of doing business.
 
Jon: Yeah, but I haven't historically argue with investors and I've got a side deal that I'm working on. Yeah, and I got in this argument. I felt like the investor appreciated me much more after the argument and then we said, No, it's a good.
 
Scott: Point, right? Yeah. So 8 seconds out idea Convoy Ventures.
 
Jon: How did it how it began? Because this is a is this an extension of your angel investing?
 
Scott: Well, it was a marriage of a good friend who had been doing convoy like as a company. It was called convoy events. Well even yeah even before events are just called convoy. And it was a it was Trent Mono who would take entrepreneurs out to random cities and random random cities across the world actually, and just put 25 people into new environments where serendipity could ensue and collisions could happen.
 
Scott: And then over like ten years, a lot of it he he built up a great relationship with a lot of LPs and founders, mostly founders that now are LPs in the fund. So as so I'm over here doing Angel Investments for seven years. Trends over here making tons of these great trips and uniting people, making a network. And it was a perfect time where I had run out of all my dry powder as an angel investor because I go to the very limit of what I have to invest in ideas, cause I can't say no because I love everything.
 
Scott: And over here, Trent is ready, looking for the next thing. And we in Angel, this is out there and they've just made this thing where you can, like, easily make a fund where you're not have to do all the back office stuff. You just kind of let them be the rails of the of the hard parts of a fund.
 
Scott: And and you can actually advertise the fund too and solicit. So it's like time to go on LinkedIn and tell the world I've I it people can invest alongside Trent and I and and that's what we did a year ago and 35 deals later and we've raised a good amount of money for you for for a pre-seed fund for first one.
 
Scott: I feel like we've done a good job.
 
Jon: So I feel like Peter, they were in the hot tub. They're randomly like messing around and then hit create a fund. Is that what happened?
 
Scott: That's the like in the cartoon version. But honestly, it was a tough time. It was. It was it was much harder than that. I thought it was going to be click button, but we're still getting like back and forth, that angel list. I mean, there's a lot of manual processes that that we have to do. And I think one of our employees is purely kind of managing that stuff.
 
Scott: But it was there wasn't a hot tub. There's actually a it's just it's just that the Kim, you know, doing one of those meetings that you do and that just there was this why not moment where it was and then and now that we did the fund is so obvious to Trent know that this is the best thing we could be doing together after all the things we've done and convoy events is one of the angel deals I did.
 
Scott: So I've invested in Trent back in the day. I believe in him. I knew I knew he had a tremendous spirit and that something was going to break out. And I'm just glad that it was Convoy Ventures with us because that's been it's been I think it's been a real good tear of a year for us in a hard year, too.
 
Scott: To be well into 2022 was a one of the crazier years for making making bets on startups.
 
Peter: Yeah, was a rough one.
 
Scott: Yeah. Or a really good one.
 
Jon: Hopefully a really.
 
Scott: Good depending on like.
 
Peter: Really like.
 
Scott: Because it flushed a lot of people out and so you got to see you got we're making bets at the bottom right now in a way.
 
Peter: I think 2023 will be a real interesting year.
 
Scott: Yeah, I think.
 
Peter: So, because you have so many layoffs, so all of a sudden you've like unlocked massive amounts of talent.
 
Scott: That are all starting something.
 
Peter: They're all starting and they all have these, like nice severance packages where they.
 
Scott: Can go six months and six.
 
Peter: Months. The runway, yeah.
 
Scott: We're seeing a lot of that. So 2023 will be a lot.
 
Peter: Of I think there'll be a good year for you guys.
 
Scott: Yeah. Yeah. Because that's the sweet spot. That's why we started. We were wanting to be like, quit your day job. Yep. Capital. And, and so we just kind of wanna be that first check when you're sitting at the. The company, you know, want to do little moonlight oil, you know, crank away on the side for something. That was what we wanted to be the capital for that two person idea that just needed enough to go out and kind of go on their own.
 
Peter: Would you do Angels Again structure?
 
Scott: Probably just because I don't feel the pain, because I'm not in the weeds of it, but I think they've been really supportive to us and I don't know another structure that would have been as supportive. I, I know there's a few more, but they, but you really want to think about what company is going to be around, you know, 20, 30 years and Yeah, and $1,000,000,000, you know, multibillion dollar angel is there to support us.
 
Scott: And I think in the long run, I wouldn't want to want my back into my fund to be done by a startup company if that makes sense.
 
Peter: What I like too, is that it's like this subscription. So it's like once a quarter you get hit with a capital call and it just comes out. And so like even if you only have like $1,000,000 in annual commitments, you think about that, right?

 
Peter: I mean, if they keep ponying up every year.
 
Scott: And we kind.
 
Peter: Of the equivalent of like a 4 to $5 million fund, it's.
 
Scott: Like it's like a recurring. It's like we have a RR.
 
Jon: Yeah.
 
Scott: And that's exactly how it works. And we had some acidity. And, you know, people that turned or whatever in our fund, but we've added a lot too. And so it is, it is. It's almost every year it renews.
 
Peter: It's like a little SaaS business.
 
Jon: Yeah, it really is.
 
Peter: It's like adding more people.
 
Jon: And it gives.
 
Scott: Us enough to make the best bets. I mean, we're not missing anything. I my opinion, I don't think we're really missing anything in Utah. It's the hyper focused fund, too. Only in Utah. Yep. So I think we have ample money to to make those, you know, hundred and $50,000 bets on on on a and we're usually coming things around.
 
Scott: We're not even like an institutional round it's like pre-seed.
 
Peter: Outside of being Utah focused, are there any other kind of restrictions or.
 
Jon: I'm kind of we're trying to.
 
Scott: Do a thesis around obviously like a tech fund. I like like, you know, we see deals on like cookie companies that are going franchise and we see those things and we don't want to be tempted by, you know, crumbles app is actually in the top 50 on the App store. So it's like it starts to feel like a tech company when you got that app you know it's connected connected cookies.
 
Scott: Yeah but I think that the I think that we're possibly just going to things that don't fit in our model of consumer tech or SaaS or we like A.I. and crypto stuff. Obviously it's kind of there, but if it doesn't fit in that, we're probably going to do an SPV, which is pretty nice that we've also set up an infrastructure to do a special purpose vehicle for things that don't fit right in the convoy.
 
Peter: Or are you want to double down or we.
 
Scott: Want we want to come in and use our LPs as we just go to our LPs. Do you want to go bigger in this in this specific deal? Because you know this industry or, you know, the founder want to more exposure?
 
Jon: What's the high level aspects of the fund? How big is the fund? How big is the team? As I want to say, it's like.
 
Scott: And we started.
 
Jon: In.
 
Scott: January last year, so 20, 2022 and I think it's only an $8 million fund at the.
 
Jon: Moment. It's a rolling fund, the rolling fund.
 
Scott: So it's like, yeah, so we we have the I can't tell you the exact commitment. Trent would be sitting here if he was reasonably down the street, but if he was four he would tell you the the stats or tell me what not to say.
 
Jon: Well bring him on later. Yeah. I don't know. With high level.
 
Scott: I don't know what to say or not say but yeah, very small fund.
 
Jon: So it's an $8 million rolling fund. You've done 35 deals, your average check is 50. 150. Yeah.
 
Scott: I think we're like rolling right around. Like, I bet it's like 80 when you put it all into it because we've gone up to 850 and we've done as low as 50. So it's I'll bet you it's averaging around 8090.
 
Jon: Okay. What's your role, your role in the fund entertainment. Okay. You're on the marketing side, the brand, your face, you're kind of like the non B.S. the VC. That's a non VC. He wants to do whatever I want because as we were preparing for this, I said, I was asking you what? How do we prepare it? I was doing my research and ironically enough, you're saying most people are not even approaching you for convoy venture things.
 
Jon: They just want to meet you. yeah, maybe.
 
Scott: Well, no, I think a lot of people want to raise money, and so I do get a lot of approached by that. But they don't realize that I'm not making the calls.
 
Jon: I'm like.
 
Scott: I have to set it up that way because a second, people think you're the where the buck stops. It's they're going to talk about your time. And I don't want that I want I was way of a team and that's.
 
Jon: What trends really get out.
 
Scott: So I kind of want to be the top of the funnel, whatever that is.
 
Jon: Like.
 
Scott: Hey, we're over here doing money stuff for startups. Come, come, have fun at one of our events, come to our LP summit. But like when it gets down to the diligence thing and like actually talking, doing the, the dating phase or whatever, I don't wanna do that a ton, right? Because that's like, especially in startup land, like I know within within probably 5 minutes of hearing a deal, I know if it's something I want, I'd want to get in or not.
 
Scott: And we have that deal, we have that deal overview meeting. So we'll, we'll gather everything from up there and it's just, it's pretty quick to know what we, what I can. I've been doing it long enough in my mind that I feel like my guts pretty tuned in and I can look at a bunch of deals on Friday and just kind of go, Yeah, N.A., N.A., N.A. Yeah.
 
Scott: So that's a heavy that's about heavy involvement. I want I want to give what I love is Convoy has worked with a ton of students and people that want to be in venture and giving them opportunity to help in the process and stuff. And so and the talent we're getting for that, I'm so surprised, are way, way, way better at getting that on the data first and asking the right questions.
 
Scott: And so that when we come together for like once a week or once a month there, it just it's just like perfectly presented on what's going down and does it do we filter out like do they quickly filtered out because they don't match or thesis or you know it's like it's just really fast. And so I'm loving the process right now, my involvement in it and it's not too heavy.
 
Scott: It doesn't suck up too much of my day.
 
Jon: So what's the thesis? I think we.
 
Scott: Want people that are like, it's a lot of it's kind of what I think Y Combinator look for just these hacker brains.
 
Jon: People who.
 
Scott: Are cheating the systems in some way, people that are using these unfair advantages that are happening right now in like technology, things that can be done only right now, you know, it's like, why is this now? Like, was there something that's happened in the in the ecosystem that can make this is now is the time for that. And so and that's and then we really like consumer because there's so many SaaS bidders here in town and doing this you know B2B software that there's a vacuum there for like these people trying really big, really big consumer.
 
Scott: It is, you know, consumer tech. And so we want.
 
Jon: Such as what?
 
Scott: Such as what?
 
Jon: What? Give me examples. Well then I'm just like.
 
Scott: And what I think consumer tech is like things that we know globally like a Snapchat, right, or an Uber or like robot.
 
Jon: Who and who in Utah is a consumer tech startup that you're tracking? We don't.
 
Scott: Have one.
 
Jon: Or you want one.
 
Scott: We need to make one that needs to come out with that. And the next, you know, I think in the next five years we'll know who that is.
 
Jon: But right now, there's not one that you said it could be Company X.
 
Scott: I don't I wouldn't want to take a bet on like are the people that have like the embryonic stage of a of a DECA Korn.
 
Jon: What came to your mind? The first first one that's let's do it What.
 
Scott: I'm doing.
 
Jon: Next. What you're doing at 100%. Can we talk about it? sure, but that's not here for that. Let's do that for the next. Yeah, yeah, yeah, yeah. Or maybe we'll have you in this other founder come back. Okay? Yeah, that's.
 
Scott: A good idea.
 
Jon: Actually, because I think it's interesting. Fun. I think it's interesting when a V.C. or an investor goes back into the trenches and why.
 
Scott: yeah, of course.
 
Jon: Like, and then there's no rule that says.
 
Scott: There's no rules that say you can't write. It's like I'm like, second, I see something, it's worth dedicating a lot more time to and operating in. It's like that's going to, that's going to pull me and into that. And it doesn't mean I can't still do venture on the side and that my co-founder in that company is also an LP in this company and and convoy and done a lot of stuff but I just don't think U2 has had its moment yet for a consumer brand to be known globally like a household name.
 
Scott: I say, and I've been saying this for over 12 years, why and nothing's changed.
 
Peter: Why do you think?
 
Scott: Well, because we didn't have one to begin with. Like like it's been a it's been like 20 years of of B2B SaaS and that's just kind of these companies are super valuable, but they're just not they're just not you can't go and survey, you know, 100 people in the streets of Brooklyn and have one person know what Qualtrics is or have one person care or know what.
 
Jon: But I mean, don't know isn't the answer. Utah investors historically are not willing or not willing to take most of those bets.
 
Peter: Yeah, but I would argue some some Utah investors have taken bets. Yeah. Yeah. And they just haven't panned out, frankly. And then but.
 
Jon: But as a large I mean if you look at a risk adverse or a risk. Yeah. A profile of a Utah investor compared to Silicon Valley. Sure it could just be a numbers game. It could be the same risk portfolio. But I feel like in Utah, it's like we understand being a business we own beauty. Business should have one consumer.
 
Scott: Company by now. We're hyper consumers as a population. We're super social, we're super networked. And so we we should have one that's not.
 
Jon: Like.
 
Scott: That's not an MLM, that's not the jazz of sports, that's.
 
Peter: Not.
 
Scott: Crumble, that's not crumble, that's not the Mormon Church. Like those are the those are that in the world. Everyone knows the Mormons or the Tabernacle Choir. Everyone knows the Utah Jazz. When I went to Russia in 96, everyone knew Carmel and Stockton, and I was in the little small, you know, Ural Mountains. And it's like, that's Utah. Utah was on the map because of the Utah Jazz, right?
 
Scott: So like, everywhere but like that to me still isn't that's still borrowed from that didn't even start that was borrowed from from New Orleans.
 
Jon: It's like can we get the actual can we have something.
 
Scott: Born and raised here? Even the LDS church was started back in New York, like, I want something to come out of this. This state born and raised that's coming out of here, that's consumer, that's known throughout the world.
 
Peter: What do you think the top consumer businesses in Utah, that's tech like homey.
 
Scott: Homey in its moment, but that was regional still. They never went around.
 
Peter: Neighbors, actually pretty neighbors.
 
Scott: Pick around the country.
 
Jon: I want a neighbor, neighbors, neighbors and any of the people that.
 
Scott: New skin, etc., will just be like housing under their breath right now because they think it's.
 
Peter: Them. Yeah. Yeah. Well, I mean, outside of them. All right.
 
Jon: But they're obviously not the consumer companies like.
 
Peter: Yeah, but they're not consumer tech. Yeah.
 
Scott: consumer tech.
 
Peter: That's true consumer because I mean, it's debatable whether or not home is truly. Yeah.
 
Jon: I don't I don't think I.
 
Scott: Don't think that's really consumer tech either You would think because living here that homey was.
 
Jon: So big because they had.
 
Scott: All the nice stuff everywhere.
 
Peter: But they're big in Utah. But but.
 
Scott: But once again, you could go in almost any other state and not in a solar.
 
Peter: No, that is even the states where they're you could say ancestry probably with.
 
Scott: Some of their DNA testing kids is one of the bigger ones might.
 
Peter: You know well even just with their their genealogy stuff. Yeah I mean before they ever had the testing kits, they were still publicly traded just.
 
Scott: As just their genealogy. Yeah, yeah, yeah, yeah. So I think ancestry is becoming.
 
Peter: A they're probably the biggest.
 
Scott: And the biggest consumer company that we've have.
 
Jon: It's word perfect. Yeah, we're perfect.
 
Scott: Probably the first and last one that became a household name.
 
Peter: But do you think word perfect? I don't know. I think.
 
Scott: Creative help. I think creative people. Mafia. Quite it. What end up creating was I feel like all the Novell stuff.
 
Peter: I can tell you did like a VC mafia.
 
Jon: Alan Ashton and Bruce bastard that.
 
Scott: Was that created a that created a house mafia and CC mafia and the few other things it didn't create a people consumer mafia. Okay we don't we don't have that. We just don't have the.
 
Jon: Risk of.
 
Scott: People have been taking the risk to do crazy consumer things. I don't think they think big enough. We didn't have we you know, create a dating app or social you.
 
Peter: Know what hey mutual.
 
Scott: Mutual interest that's down Phenix the owner and even though it targets the Mormon population here but a dating.
 
Peter: App called Bumble was.
 
Jon: A.
 
Scott: Woman who grew up in Salt Lake City. Do you.
 
Peter: Know? Yeah, yeah, yeah.
 
Scott: Stated genre and then me Bumble. And so that was, you know, we.
 
Jon: Have we.
 
Scott: Have some great people coming from the state, but.
 
Peter: No one really keeps.
 
Scott: Their company here.
 
Peter: Yeah, that's changing though. I think. So. I feel like more, more people are staying in Utah than leaving.
 
Scott: Yeah.
 
Peter: If anything, like people in Silicon Valley are coming here. Yeah. I've met with a handful of entrepreneurs that came from the bay.
 
Scott: I think they're just escaping California, not migrating to Utah.
 
Peter: Yeah.
 
Scott: You know, And then soon, no one.
 
Peter: In the same.
 
Scott: Yeah, exactly.
 
Jon: Right. What are some of your favorite deals that you've done? That convoy.
 
Peter: Which child do you love most?
 
Jon: Yes, I just had. Is that how you interpret it? Peter?
 
Scott: I had lunch today with one of my favorite founders is Lee Chang. He did rock. And it's.
 
Peter: It's such.
 
Scott: An obvious one that when you hear it, it's like, duh. But it's it's still like anything. It's just like that cold start problem of the marketplace and what it is. It's DoorDash for Home Depot and Lowe's. It's a it's a DoorDash for like construction construction sites. Yeah, yeah, yeah.
 
Peter: Where it's super smart. It's just.
 
Scott: It's like.
 
Jon: It's, it's like a yes that's going to exist.
 
Scott: In our lifetime is going to be a no brainer.
 
Peter: Surprising I didn't already like, why didn't Lowe's and Home Depot already jump on this to some degree, right.
 
Scott: Like when they are I think Sun Pro is and I think Home Depot is doing some trials or somebody is doing some trials with us. And and if they're out there listening, guys, go check it out It's like makes sense and and it pencils to for for like time on job and just getting that stuff to the site and and so I think that will be it's just one of my favorites too.
 
Scott: I just love the ideas he's explained I love the founder. He's he's just nimble, nimble, nimble and always has been. And then there's just a lot of other there's a lot of other ones that were really awesome, right when we were started investing because it was crypto was at its all time high and you were in and then and then those ones have struggled because it's like we're in the winter time right now.
 
Scott: And so now is the time to build and stay alive.
 
Peter: Build camp, burn.
 
Scott: Yeah, yeah. So I mean, I could keep thinking about it and look at logos and tell you more, but that's not that's what I want to write in my mind right now. So I just want to say that one.
 
Jon: Okay. Different from the other three that you talked about during our, our prep. Well, those are my angel investments. those are your angel investments. So what are your three top angel investments, Favorite and favorite?
 
Scott: And why? Why, why would they be my favorite? Because they're going to make me money or they're going to make.
 
Jon: Me feel better.
 
Scott: Or they're. I just like hanging out with the founders. How about how about this?
 
Peter: When you invested, you had like, a thesis or vision. I was.
 
Scott: Always trying to find this.
 
Peter: Name come to fruition. You have have you had that? Like for me it was Carter. So we invested in Carter years ago and I was like, I immediately got like the vision and I was like, this could be like really big because they start like knocking down, you know, the entrepreneur or the funds. LP is like, then you start connecting this into a big marketplace that's super interesting and creates like these incredible networks, right?
 
Scott: Yeah, it was a great one.
 
Peter: You got anything like that where you're like when you invested, you're like, I think this could be X, Y, Z, and it kind.
 
Scott: Of already happened.
 
Peter: Or at least it's headed in that direction, right? I mean, Carter hasn't fully achieved that either.
 
Jon: But yeah, I feel like.
 
Scott: Space is probably the one that's going to do that. Yeah, it's just such a simple problem and such an obvious one. And they're just they're just such seasoned entrepreneurs that it's like, So I would never bet against.
 
Jon: Its.
 
Peter: Space is a cool company.
 
Jon: The Neobank, the.
 
Scott: New bank for the Hispanic community here in the U.S.. Yeah.
 
Jon: That's all.
 
Scott: On Spanish. Just like makes it very easy for them. For the 20, I think there's 28 or 34 million. It could be way more. But there is a lot a lot of customers in this state, in this country that status has as their total addressable market.
 
Peter: What's cool about, say, Stu, is that if you think about a lot of the people in that population, they have mass of fear. Yeah. Of banks. Yeah, right. Yep. They don't like going into your traditional bank and so much more than I think a lot of the other kind of niche focused affinity banks.
 
Scott: Yeah, exactly. So, so they're seeing that success in their in their just, you know, year of launch they're seeing that just a hockey stick course that I get. So that's what's fun And it's also I think becoming what it should. They've only done their series Age not even a year after their seed the other the other one that I think's fulfilling that thing is the that I just I haven't talked to the founders as much as I should.
 
Scott: I was really involved the very beginning before they kind of had prior market set but that's neighbor dot com. I just think that Joseph pretty visionary he stayed visionary through COVID and really kind of kept his team rallied and that they got up to series B already and and and they've got a really good customer base and nationally and if you think what they do is they do storage you can turn your extra space into storage.
 
Scott: So it can be like an RV line on the side pad on the side, your house can be an empty basement in a garage and and so I think that I think that one has and then the just the name allows me to do so much more than even storage. So who knows where they'll go with that. And I know that the size of their vision and the and whenever you can create a marketplace that makes money out of things that don't aren't currently producing income, you've really got a nice like inbound supply side of the equation.
 
Scott: And and because like you know for most families an extra 120 bucks is game changing for, you know, across America and that's something that can be done on neighbor and and that's that's I think really fun to watch as is the growth of that. And that's really our only true marketplace I think that we have and you know like there's other things, but that one's truly a two sided marketplace that's that that that is here and born in Utah through and through.
 
Scott: So I like I watch that with a ton of interest.
 
Jon: I feel like I'm more bullish on neighbor from our conversation. I just feel like in my mind, neighbor doesn't pencil out. But then my second part is if they raise a series B, someone's looking at the numbers and there's something I don't understand about them.
 
Scott: They're investors, are they Airbnb investors? And like they have Jordan or something sit on the board like some really great investors that saw stuff that I don't think we get an opportunity to see here in Utah an increase in their series a investor. So they they've attracted outside capital in ways that not many companies here in the and consumer companies in Utah have.
 
Peter: I think their big unlock too is partnering with more commercial buildings. Yeah like getting access to that that supply.
 
Scott: Yeah yeah I haven't looked at what they're up to now to like see how the mix of their product is and the partnerships. But I, I know that, I know that my wife's company Jerry, which is Airbnb or like DoorDash and laundry. Yeah. Is unlocking the whole idea of.
 
Jon: Of.
 
Scott: The, the B2B contracts that can be done with food services or hotels or Airbnbs to do laundry for those. And so there's there's a lot of unlock in there if you can figure out how to make your marketplace service, you know, these big existing B2B contracts and not just only customers because like consumers, because they're hard, as hard as one for laundry, it's much easier to do Thousand towels that divvy employees are discarding in that model of their model than it is to take care of like baby clothes and diarrhea and and and yeah, put that into the home of another person and do laundry that way.
 
Jon: So awesome. Let's go through your your bullet points in, like on your website and like who you back and we'll wrap this podcast up now. But so you're specifically looking for people who know how to build not just business guys with an idea. So when you are getting involved, do you just want to see someone trying to hack something together and conviction someone.
 
Scott: Someone has to do that.
 
Jon: Right? But like at what point would you say, hey, you don't have a paycheck, you know, have a business card, don't have a website, but you're building something where in or is that too early? No, that's that's a good time. We like to see co-founders. Okay. So you do not like investing in solopreneur? Yes.
 
Scott: I don't know if we've done it yet. Maybe once or twice. But out of the 34 or five deals and we do about two deals and I don't think any of them don't have a assembled team of three 2 to 3 people just like.
 
Jon: Okay, there's a lot.
 
Scott: Of power in like multiples of two brains and integrator and like a visionary. And so someone that can kind of keep a vision cast and then another that's really good at implementing a developer, a designer, a business person and a, you know, or a strategist. And so there's you want those yin and yang and that's like Trent. That's why Trent and I work so good to get.
 
Scott: Actually, we're almost too similar. But he, he does he's the one that can like.
 
Jon: You guys look like you have a lot of fun. We have a.
 
Scott: Lot of fun. But he we get work done.
 
Jon: He's we keep bumping into you in Vegas, Peter and I. Did you still in the working phase of his life? He's a little younger than me and he's still I can.
 
Scott: Sit down and computer and he doesn't have ADHD.
 
Jon: So he's.
 
Scott: He can crank.
 
Jon: Okay, I it can.
 
Scott: Be done on my cell phone while.
 
Jon: Driving. Okay. Point is, you want to see companies growing surprisingly fast every week or month with little resources. Like what does that mean for you versus like Peter, you know.
 
Scott: Growing means like are they getting.
 
Jon: To the problem.
 
Scott: Faster?
 
Jon: Like, I mean, are you looking for people who are doubling or tripling every month? I don't even know or look at that stuff. Like I don't even look at that. Meaning I know what's on your website. So yeah. Yes, it's a fair question.
 
Scott: So what I'm saying is.
 
Jon: I, I.
 
Scott: Can feel the growth. This is probably where I am almost I have an unfair advantage in this. I have a spidey sense where I can feel if something's growing or not.
 
Jon: Okay.
 
Scott: I am I seeing it in the market. So when you're investing in consumer, am I hearing about it randomly on the street? I remember I, I passed on chapbooks as an investor and then I started hearing about it from everyone in Texas and other places. I'm like.
 
Jon: It's like the worst.
 
Scott: Is when you pass. And then the consumers in another state are talking about this product. And it's happened several times where I you see the up here I know the back.
 
Jon: The cars yeah I miss.
 
Scott: Pure and I'm just like that was.
 
Jon: Like I met with the founder early on he might have brought me in there him and I remember but I didn't really John Richards introduced me to Pure. I missed that one and it's just like and homie, I passed on.
 
Peter: I have a friend that passed on Facebook and he like, kicks himself because he was in Italy. really? And there was a girl in the hotel in Italy in like not just Italy. I think they were in like Venice. And she was on the computer on Facebook. And he was like, I should have known at that moment, like, here you are.
 
Peter: Yeah. Other side of the world in vain at Venice and you're spending your time on Facebook. That was that was, that was like, yeah, right.
 
Jon: And that's like in the.
 
Scott: Movie how Sean it was it on Parker it's like that was when it was you remember when he got really excited when the Stanford student was using it and he's like, crap. He saw the product in the wild and he knew, yeah, and that's when he races back to doing up his art. And so that was me for Neighbor.
 
Scott: We didn't invest. I'm down in I'm down in Mexico in this little town with some friends and they're trying to be able to do their stuff like we should try and neighbor and I hear that on on like not knowing that they didn't know that I was looking at the deal.
 
Jon: I call up Joseph right then.
 
Scott: We went in and we got in on the deal at a time. It was it took that validation and that's when I talk about is like.
 
Jon: I'm listening.
 
Scott: For those signals sometimes that are as obvious as someone saying it. And I'm like, I better get in. Other signals would be like, you know, just the industry is just seeing create like a GPT three type craze. And so you know you can know like there's some companies that have been playing around there and then it just hasn't been a fair chance.
 
Scott: And 2023 is going to be crazy here. And so it's like, did you make the relationships with those companies and is the time now or did you get an even a little bit early because you saw it, you knew that 2023 is going to happen. I've just been chatting with GPT three for a while with Kirk Mehmet for almost two years.
 
Jon: yeah. I think you're the first person I saw online. He did a post and it made me nervous. I What is happening? Yeah. And so it wasn't consumer though. It was his own chat and it was so expensive. Every time I chatted with it, Kirk's like, that's another $40. And it was just me tinkering around. It was your sessions.
 
Scott: With it back in the day were not, not cheap, and so it wasn't a consumer product at all. And now, now they just unleashed it. And and it's I think it cost them a lot of money to still run, but it's like they know that this is probably on the biggest growth opportunities in the world to get a bunch of consumers in your.
 
Peter: Then I think they're getting everybody hooked.
 
Scott: Every the athlete to a dangerous.
 
Peter: Degree. They are the brand right now right.
 
Scott: And CBT so yeah I I have a gut I don't so I don't really look at growth numbers. I mean that's important to like see that they're doubling and stuff but I really want to know I did it hit the streets. Well did the do I have a consumer that I know talking about it? I mean, good experience and swearing by Adri is one that's I've had about five or six people say they can't live without it.
 
Scott: And that's that you know, that's like I think Peter Thiel talks about like how how you just want that first customers that are going to go to bat for you that can't can not survive without it. And so there's certain companies that I see that get that that inertia and and when you have that, it's like it's up to you to screw it up.
 
Scott: Once you have that inertia that you have a happy, happy customers that are just going to be lifers. If you can't figure out how to organize your company, get the right, you know, people on the bus. That's that's the worst thing is when you see great product take kind of catch wind and then the team just cannot figure it out how to deal with the growth because they haven't been there before.
 
Scott: They don't know that they just got this, you know, literally just a comet with a little little butterfly net. And so it's like.
 
Jon: Dang, kind of they're going to be able to hold.
 
Scott: On or they're going to unravel. And I've seen some unravel.
 
Jon: And you look at the.
 
Scott: History of most of the companies, they have these stories or co-founders that the booted and the CEOs get. One. One of my companies Gab had a great initial someone that was like the perfect person for the first few years, but was, you know, I guess it struggled to to continue to lead the team and and was was kind of this.
 
Jon: Actually like.
 
Scott: Whatever gave was great has some turnover.
 
Jon: Yeah so it's just like I've seen I've.
 
Scott: Seen I know we aren't talking about dirt on here, but I don't want to like get into.
 
Peter: Things like.
 
Scott: This. But, but yeah, there's, there's companies that unravel when they grow too fast and scaling prematurely. Yeah. Yeah. We're just like first time, like the leadership is just not, you know, the founder might not have the ability to let go sometimes like and really know that at a certain stage of your company you have to like, let go of certain things.
 
Scott: You can still run it, but man, if you cannot, if you have to be in every single piece of the biz and have be every piece of it in every single way like you can think you're Steve Jobs. And I still don't think Steve Jobs was. I think he had to know how to let go sometimes. Right. And when to be an asshole, when to let a team just run with something.
 
Scott: And so so I don't know. I'm not an historian to know all this stuff, but I just I've seen things where people hold on too tight and that's never my experience, never a winning strategy.
 
Jon: All right, well, sounds good. So Scott will be with us for the next two or three podcasts. Go to venture capital law firm. If you want to learn more or to follow this conversation as we roll along.