Hong (@quan) and Aye (@ayemoah) talk about the struggles of being an immigrant founder, how to creatively hustle and raise money, and about paying forward your success. Topics include: the "UberCab" fundraise story (00:54), boston venture capital environment (05:02), how to focus on building a profitable company (07:01), how to identify unicorn founders (10:26), how she got into MIT from a country in turmoil through a crazy series of events, and paying it forward to help a generation of hard-working, potential future founders (15:40). Watch on YouTube: https://www.youtube.com/watch?v=8AxIvoDDL-c
Hosted by Hong Quan (https://twitter.com/quan)
Produced by Van Nguyen (https://twitter.com/thegoleffect)
See more on https://fundbmc.com
—
Talk to us on:
Twitter: https://twitter.com/fundbmc
Instagram: https://instagram.com/fundbmc
Facebook: https://facebook.com/fundbmc
- We make more than what we raised every month
- Coming out here, you literally got into a car, pitched a guy in like forty minutes, and got your first commitment.
- Yes!
- Hi folks, this is Hong from FundBMC, and we're here today with episode two. Our guest is Aye Moah from Boomerang, the Gmail app that everyone knows and loves. She is both the co-founder and chief product officer. Welcome.
- Thank you for having me.
- So you have a super interesting story. We've known each other for almost a decade now.
- Yeah.
- And I don't think like you're not a press person, like you don't, there's not a lot of information on you guys, so if I search about the story, and like the founding of the company, it kind of takes you all the way back to the Uber cab story, I would say.
- Ah, yeah.
- Can you tell us that story?
- Sure. So we were trying to raise money on our seed round back in 2010 in Boston. And we probably went like 34 to zero or something, right? So we were doing something that nobody's really done before. Building a personal productivity plugin into somebody else's platform, Gmail. There was nobody else doing it before then. So Boston investors were like "How could this make money?"
- Because Gmail at the time was also free.
- Gmail was at the time also free, yes. And we weren't sure how we would make money either, but we knew that we built a really useful product that our customers just love. And we know that it brings real value to real people. So, we came out here because we had two weddings like one in Seattle, one in San Diego. So we stopped by in Silicon Valley to talk to a bunch of investors and see what happens. And we were staying at this like crappy, run down little hotel in Sunnyvale. And the name is Sundowner Inn is that place.
- Oh, I know that place.
- Really depressing name, right? Who named that? We were supposed to meet a friend of Alex who is now a VC, and who canceled on him, so were were just sitting in the hotel pretty depressed. And I saw a Tweet from Dave McClure on Twitter saying, "Hey, if you can pick me up from Buck's," which we didn't know what Buck's was right, we were not here.
- So Buck's is a restaurant in Woodside.
- Woodside, that where apparently
- A lot of VCs hang out.
- A lot of VCs hang out there. We didn't know. I just saw Buck's and I was like, "Hey, we can pick you up." And the whole Tweet was, you know, "If you pick me up and take me to my car mechanic," because his car broke down, a mechanic in Mountain View, "I'll let you pitch you on the ride." So we responded and like, "We'll pick you up," but we didn't actually know where it was, so Alex just started driving as were were coordinating, Buck's what, what is Buck's?
- Were you in the car?
- No, I was coordinating from the from the hotel.
- You were the operations center.
- Yes. And I was like is it Starbucks in Woodside? What do you mean? "No, no, Buck's restaurant." So I Google, send the address, and Alex is typing into the GPS and then they, you know, talk on the way. And the main thing is, David's very data driven, and you know, he has his like personal rule of three signals. The three signals he got were, one was his assistant, Melissa, you know Melissa?
- Yeah, of course.
- Yeah, she was using Boomerang at the time already. And she tell Dave about it like, "Oh, look at this tools, it's really cool, "you should try it," right? So she was actually using Boomerang to manage Dave's emails. And then the second signal was there was another woman VC, Katherine Barr was trying to intro us to Dave to meet with him.
- She's still a VC.
- Yes. And then we have, basically just like he just talk us through the whole fund and like, "Hey, how many people come in? "What's the conversion rate? "How many percentage retained?" All this stuff we know it down cold, so Alex was able to answer. So in that 40 minutes of driving him from Woodside to Mountain View,
- Thank goodness for Bay Area traffic.
- Yes, and he committed, and that was our first check.
- Really?
- Yes.
- Your first check. So you were still in Boston.
- We were still in Boston. We haven't even officially move out here. We were only here for like five days.
- This is like pre-500 Startups.
- Pre-500 Startups. It was fund one,
- So like you were batch zero.
- Or fund zero or whatever,
- Yeah, batch zero, original crews from 10 years ago.
- Yes.
- I remember Melissa. Melissa's still 500, she's awesome. I feel sorry, like--
- Yeah, she's still a personal friend.
- Managing Dave's email is an impossible job.
- Yes.
- Right? Like there's no way. That guy declares email bankruptcy like every two months. But the VC ecosystem there, it used to be Boston was the center of VC, like a long time ago.
- Right, they were the center of innovation for a long time, but at some point it turned into more of a, you know, do you have a gray hair, white guy, Harvard MBA as your CEO? And if not, you don't quite fit the mold. And we were three kids, right, in our 20s, late 20s,--
- So it was you, Alex, and Mike?
- Mike, yeah. And we were in our 20s, we have never done a company before, and you know, first time founders, all developers. So they were like, "Where is your Harvard MBA?" And we are like, "We don't have one."
- Right. It was a different model back then, because,
- It is.
- You did need this kind of MBA type to be the face of the company,
- The CEO, yeah.
- And like the engineers were kinda kept on the side, like you never go to pitch meetings, you don't actually go to--
- The engineer founder, you know, trend, is very the West Coast--
- It's a very Valley thing.
- Silicon Valley driven thing. And the other part is, they also are very willing to fund things that have already a proven business model with all the financial projections, and this is how we're gonna make money, and this is how much, you know, profit you get. So if you're trying to raise, at the time, 2010, you're trying to raise the number 10 clone of Groupon, yes, they'll write you a check.
- Which was a clone of something else, but we'll talk about that later. But yeah, so this is back in the day of like business plans, you had these networks, this is a lot of MIT, Harvard, kind of East Coast money. And then coming out here, you literally got into a car, pitched a guy in like 40 minutes, and got your first commitment.
- Yes.
- It's amazing.
- It was pretty, I think it convinced us that we should move out here.
- Yeah. You're a unicorn in the old sense of the world when I was recruiting, a unicorn was someone who was technical, was a CS degree, did UX, did UI, did everything. And it would be so hard to find these founders, right? These unicorn founders. Nowadays unicorn's a company, everybody knows that, there's tons of them, most of them don't make money. But Boomerang makes money. You've made money from day one. So you've only raised a seed round, it was about 375 for 400.
- 400 there, yeah.
- And you've never raised again, but you've made money every year. Can you talk about that, and how your investors think about it?
- Yeah, I mean we've really focused on ability to get value out of what we provide as a service to your customer and we knew that we wanted to grow from our own revenue and profits. It takes longer, right? It's not explosive growth, because we are not able to spend on unprofitable growth, right? We focus on only sustainable marketing channels that actually brings in more money than we spend. But at the same time, it makes us very focused. As a company we only work on things that will bring value to our customer, because that's who fund us and who guide us on what to do next. For our investors, we have been very lucky. A lot of them are personal friends, and personal champions to us, and mentors and advisors, in addition to being investors. And they've been very patient with us, but the good part is we were able to you know, issue our dividends, and we already issue more than what they have invested in the company just as a dividend. So the beauty is they got dividends, and they still own equity in our company as we are growing. So it's a pretty happy relationship.
- Yeah, I mean for angels that's probably ideal because as an angel investor, most of the investments that you make is probably going to go to zero. But if you're getting dividends and it's a recurring revenue stream that's more than the money that they invested, it's all gravy after that, right?
- Yeah, what's not to like?
- Yeah, that's great, awesome. Boomerang is profitable to like multiple millions per year, right? So in the Valley we would celebrate a start-up for raising, you know, a $3,000,000.00 seed, or [Series] A.
- Right, right.
- And you're like, you do that every year, so like what's the big deal?
- We actually make annually a large series egg.
- Yeah.
- Maybe, I can talk about it, I don't mind.
- Yeah, I mean like I've heard it's seven figures.
- We just hit eight figures.
- So there you go. So eight figures, without going into detail, that's a lot of money for a very small company, that is still majority owned by the three founders. That sounds great to me.
- It is, but there isn't the same level of respect for the real dollar that you get from the customer.
- Oh my gosh!
- Isn't that strange?
- It should be the other way round.
- I know, right? If you go to, you know, somebody to go pitch, "Hey, we have this story," they'll be like, "Oh, how much did you raise? "Who's your VC?" We're like, it doesn't matter.
- Those are all signals.
- How much we raise is absolutely immaterial to us, because like we make more than what we've raised, every month. They only look at that as a signal. But, I think the tide has turned. So there is, I'm forgetting the journalist's name, I wish I could remember. He went and did a lot of research on what are the makings of the unicorn founders? And, what he found was, the highest correlation is, and he defined a term called super founder. And super founder is somebody somebody who has either sold a company for more than $50,000,000, or only received funding and got into more than $10,000,000 above in revenue. Revenue, not how much you've raised, or what valuation you get. Actual cold, hard cash from your customer.
- Right.
- And he found that being a super founder has the highest correlation of the next company they start be a unicorn.
- Right. Interesting.
- I think when you actually crunch numbers and see things as data points rather than just you know, unconscious buyers in your head like, oh, they raised, you know, $20,000,000 for their last company. Well yes, but do they incinerate that $20,000,000? Or do they turn those $20,000,000 into something else.
- So there are two definitions of super founder. The first one is you have to exit above 50.
- Above 50, or--
- Have revenue profits over 10.
- Yeah.
- It's two different. It's almost like two binary outcomes, right?
- Almost, yes, but I think both are invalidated points in what he asked.
- So it's just a predictor for the next company.
- Yes. If you start a next company.
- Interesting. So I would definitely put you in the category of super founder.
- I never thought that I was going to be outside of Burma, let alone US or MIT or anything. I never thought it would, like I would just dutifully go to college, you know, start a business, because that's what my family does, is we have, everybody had their own business. So I assumed that's what I was going to do. And I run into a guy who came back from Harvard Master of Public Health program. And he was a journalist. An anti-government journalist. And when he was at Harvard, he met a Nepali student who was going to undergrad at Harvard. And he's like, "I don't mean to be rude, "I came from Burma, you are from Nepal. "How can you afford to go to Harvard?" Like how does that work, right? Are you really wealthy? And the student told him that, "Hey, you know, university like Harvard, "and the really top tier well-endowed university "have a need-blind admission."
- Yeah.
- As long as you get in, they will figure out the financial aid package for you, even if you are an international student, which was basically like, it unblock a lot of things in his brain. So he research about universities here and talk to people. And when he got back to Burma after his program, he started doing this like informal get together.
- Huh.
- And at the time, it was considered illegal, right? Because Burmese government did not want people to gather on their own. If you gather without permit or permission, blessing from them for more than like five to 10 people, they can arrest you.
- Wow.
- So he was doing this little covert guerrilla--
- To get people to go to college.
- Educational campaigns, because he knows there are a lot of us just sitting around,
- Waiting.
- Waiting to go to college, and not knowing what to do. He said, "Hey look, there is this thing called "need-blind financial aid." And I went to one of those seminars, or little things, I met him once. He kinda laid out to process like this is what you do, take SAT, you have to apply. And then I tried to go back to him, right, to ask about like financial aid application process or something. And his family, I went to his house, his family was super dodgy about, he's like, "Who are you? "Why are you asking for him?" And I later learned that he run from the government through the jungle to Thailand, because they were trying to come after him. So that's the story of how I found out about a way to apply to US universities. And you want to look for this magical key phrase called need-blind admission.
- Sure, yeah.
- And then I got into MIT, and there was a scholarship set up by a Saudi guy for third world students, exclusively.
- Wow.
- So he paid for my education. His foundation pay for my education. And that's how I could get
- That's crazy.
- To where I am. Because like it's a bunch of
- That is quite the story.
- Random stories, right? And you never know like how--
- But it's not random. But like you said, you can see the dots now, looking back.
- Looking back, but you can't connect it forward when you were in the moment.
- No way.
- Yeah.
- But like, I mean, without that guy you wouldn't be here. Like it's crazy.
- Yeah, exactly. So when we started the company, and you know, we named it Baiting and stuff, we put it in our company charter at the time it's just wishful thinking but, when we make profit we're going to donate you know, portion of our profits to advance education in Burma.
- Nice.
- And we didn't really know if that's where we would get to at some point, right? Like actually making profit seems so far away when you're just like signing your paperwork.
- Yeah, totally.
- And then one day we were like, "Wait, we are actually profitable!"
- Here's all the money!
- Yeah, like we can donate. So, so far we've done a few different projects. We funded an innovation kind of like a start-up hub in Rangoon where I grew up. We did a mobile bus that's bring the education to kids who can't go to school because they are working.
- Yeah.
- So we have a very big tea shop culture in Burma. And a lot of them are run, or staffed by kids who should be in school, but cannot because of their family.
- Because they're all family businesses.
- No, they are there from the villages and they go and come to the city and work at a tea shop, and they send money back to their family. So there is no way for them to really learn or like go to a regular school. So somebody decided, hey, and it's actually, I think he was Burmese/American, or you know, some guy who was in New York and then he went back to like he's wanted to start this project, so we funded the bus with the, they outfitted a school bus into a mobile classroom. And they go to these tea shop and teach these kids after. And like these kids are amazing. I admire them so much. They wake up at 5 a.m., work all day, and the tea shops usually closes around like five. So they had a 12 hour workday, and then they come to the mobile classroom, and learn for another two hours or three hours. And that's like the level of determination and you know hunger for knowledge is I don't know, if I had to work 12 hours a day and having to be up at five, I'm done.
- Well, the great thing about having kids is I'm up at five every day.
- That's true.
- I mean, one of those kids could be the next you, right?
- Right. So when I went back and talked to them, right, I was like, "Look, you know, I was able to go to "college because of some random guy "from some other country that I never heard of "set up a scholarship. "Now I was able to do that. "I start a company, now I can do that and help you. "So when it your turns, make sure you pay it forward, "and help somebody out."
- That's great, and we covered a lot. We kinda wrap up. Wanna give you someone time to talk about anything you want. I know Insights is a new product you guys have. If there's other things you wanna talk about. Whatever you want. The floor us yours.
- I don't know. I don't really have anything special. I don't really like to preach.
- Well you can talk about Boomerang. Or is there a way for people to donate to the schools in Burma?
- Yeah, if they want to donate, we are doing a fundraising campaign. I just got a fundraising letter today, and I'm supposed to be out there fundraising for building more schools.
- Everybody can get behind that.
- Yes.
- Well thank you very much for coming by. This has been a great chat. This is episode two of FundBMC, and we'll see you next time.
- Just get the name right.
- Okay.
- Yeah.
- I'm gonna redo the intro then. Are you standing there the whole time? Well, okay.
- Oh, okay.
- Wow, all right. No, no pressure. So I'm saying Aye Moah.
- Aye Moah.
- Aye Moah.
- Mm-hmm.
- A, got it. All right. I can't believe you're standing in the corner. All right, fine. No, I think you're fine. You're shooting off this camera anyway. You're shooting off camera one, so it doesn't matter. Let me do this real quick.