In the second episode of "20 Minutes VC" with host Harry Stebbings, entrepreneur and investor Chris Jones shares his journey from founding the Internet marketing agency Pepper Jam to selling it to eBay, and subsequently creating his investment fund, KBJ Capital. Jones, a former student turned accidental entrepreneur, emphasizes the transformative impact of the Internet on business and entrepreneurship. He discusses the importance of learning to generate and monetize web traffic, which laid the foundation for his success with Pepper Jam. Reflecting on the sale of his company, Jones candidly reveals the mixed emotions of excitement and loss that accompanied the transition. He also imparts valuable advice for aspiring entrepreneurs and VCs, highlighting key traits like optimism, decisiveness, gratitude, and focus. Jones advises VCs-in-the-making to build their professional network by adding value and showcasing their commitment through actions like internships and blogging. Finally, he shares his optimistic outlook on the tech industry, dismissing the notion of a tech bubble due to ongoing industry disruption and his continued investment in early-stage tech companies.
"Now, Chris is the former president and CEO of Pepper Jam, an Internet marketing agency he founded and later sold to eBay in April of 2010. Having had this successful exit, Chris founded an early stage technology investment fund, KBJ Capital, whose portfolio companies include highlifes.com, Frenchgirlsapp, and Referlocal.com."
The quote introduces Chris Jones as a successful entrepreneur who transitioned into venture capital after selling his company to eBay, highlighting his current involvement with KBJ Capital and its portfolio companies.
"So, yeah, I've been what I call an accidental entrepreneur. I was a professional student for nine years after high school. So I went to Penn State and got an undergraduate degree in psychology, and then went on to graduate school where I studied experimental psychology and I got a master's degree."
Chris Jones provides a summary of his educational background and how his fascination with the internet's transformative potential spurred his entrepreneurial journey.
"But what I realized was that, wait, I could sell gourmet food online, but I could also build websites, generate traffic to those websites using search engine optimization and pay per click marketing and a number of other things that were still very early to the Internet at the time."
This quote explains Chris's realization of the broader potential for his internet marketing skills beyond selling gourmet food, leading to the establishment and growth of Pepper Jam.
"And I actually read your article about the meeting where they asked you about acquiring the company, and they asked you the very pointed question of how much? And I was intrigued by your answer, because you said you went against the traditional ethos of reserving your own valuation for yourself."
The quote references Chris Jones's approach to discussing valuations during acquisition talks, highlighting a moment when he chose transparency over traditional negotiation tactics.
"Chris is also a prolific writer on the technology industry and all of his articles will be included in the show notes for you to read after the podcast. Don't forget about the competition, a chance to win all the books mentioned in the first ten episodes, as well as a consultation with one of the vcs where they will deep dive into your business plan, pitch and advise you on what you need to do to get funding and answer any questions you might have."
The quote serves as an announcement for additional resources and opportunities for listeners, emphasizing the value-added components of the podcast episode.
"Yeah, I mean, I'm a big believer in using your gut. I think that your gut, that sort of intuition that we all have, it's important to get in touch with that and use it as often as possible."
This quote highlights Chris Jones's belief in the significance of intuition or gut feeling in making business decisions, suggesting it's a valuable tool alongside rational analysis.
"And that gets to your question, which, know, why did I start investing in companies and why have, you know, known as sort of a venture capitalist or an angel investor? And it's because after I sold my company and was part of a much larger company, I realized that where my passion and my excitement came from was really entrepreneurship building and starting things."
Chris Jones's quote explains his transition from being an entrepreneur to an investor, driven by his passion for building and starting new ventures, and his desire to support other entrepreneurs.
"Sucked. It was terrifying... A big wire transfer occurred... But at the same time, just to be brutally honest, we put so much heart and soul into entrepreneurs do into building companies that when that moment happens, yeah."
The quote reveals the emotional complexity of selling a business for an entrepreneur, indicating that despite the financial rewards, there can be a sense of loss and fear associated with the transition.
"You know what, I'll just be brutally honest to that. I actually had achieved a level of financial independence and success before I sold... I did swipe a couple of checks to people I love, and I probably gave some money away to charity and stuff like that, which I wasn't in a position to do prior."
Chris Jones's quote illustrates that his pre-sale financial success gave him the ability to be generous with his wealth, supporting people he cares about and contributing to charitable causes.
"Here's the lesson. The lesson is that there are a number of specific characteristics and qualities of successful entrepreneurs... But ultimately, those characteristics that I referred to are really the value that I give the companies that I invest in."
The quote from Chris Jones encapsulates the key lesson he learned from his entrepreneurial journey: certain traits and qualities lead to success, and he aims to impart this knowledge to the companies he invests in and through his writing.
"And those are the type of characteristics that correlate with being grateful for what we have, even though we want more."
This quote emphasizes the importance of gratitude in entrepreneurship, highlighting the balance between ambition and appreciation.
"They tend to be optimistic. They tend to be decisive. A characteristic of an unsuccessful entrepreneur is the inability to make decisions, in particular, hard decisions."
Chris Jones outlines decisiveness as a critical trait for successful entrepreneurs, contrasting it with the indecision that can hinder progress.
"The final one, dude, this is the silver bullet, is one's ability to stay focused."
Chris Jones identifies focus as the ultimate game-changing trait for entrepreneurs, elevating it above other characteristics.
"One is, you need to work on building up your influence. So building up your professional network."
Chris Jones advises aspiring venture capitalists to focus on cultivating a strong professional network through value-driven relationships.
Internships asking them a very thoughtful question on something that they've written. I mean, if I write something and get it published, and someone reaches out, not unlike you did, and says, hey, I read your article here or there on your blog or on Techcrunch or wherever, and what do you think about this?
This quote emphasizes the importance of doing one's homework before reaching out to a VC, showing genuine interest and engagement with their work, and providing a fresh perspective or challenge to their ideas.
But I also get a sense that because I'm very public socially and whatnot, they'll read articles and stuff and they'll think that I could just go out for lunch with them or just very quickly give them what they need in order to be successful.
This quote reflects the misconception that public figures in venture capital can provide immediate and easy pathways to success, overlooking the hard work and dedication required.
Intern at a venture fund. So, in other words, I think there's a professional angle here, which is, hey, you reach out to someone like myself or someone else and say, I've been prepping for this. This is something I'm really interested in.
This quote suggests that gaining professional experience through internships and showing a proactive interest in the field can make a positive impression on established VCs.
Because I think that what we achieve in life tends to correlate with what we think we're capable of achieving. So the bigger our goals, the greater the things we think we could accomplish, the more likely it is that we are to accomplish them.
This quote underlines the philosophy that setting high aspirations can be a self-fulfilling prophecy, leading to significant accomplishments.
No, I think the valuations right now are very high, but I don't believe so. And the reason I don't believe there's a tech bubble is because I believe that the period of time we're in right now is a period where you're going to see a lot of disruption...
This quote explains Chris Jones's view that the high valuations in the tech industry are justified by the significant disruption and innovation currently taking place, rather than being indicative of a bubble.