20VC The Biggest Mistakes Startups Make Hiring, The 2 Reasons Startups Fail and How to Avoid Them, Why Most Startup Equity Plans are F and Why You Should Scrap Titles From Your Company with Eddie Vivas, Founder & CEO @ Curated

In this episode of 20vc, host Harry Stebbings interviews Eddie Vivas, the founder and CEO of Curated, a network that connects consumers with product experts for personalized purchasing advice. Vivas shares his unconventional journey into tech entrepreneurship, from dropping out of high school and working in a warehouse to creating a successful ad tech business and eventually founding Curated. He emphasizes the importance of building a company with a long-term focus, hiring a team of missionaries over mercenaries, and ensuring that the core elements of the business are solid before scaling. Vivas also discusses his approach to fundraising, prioritizing the right investment partners over valuation, and the significance of transparency and debate within a company culture. He envisions Curated expanding beyond sales to offer comprehensive expert advice in various aspects of consumers' lives.

• Eddie Vivas is a serial entrepreneur and the founder and CEO of Curated, a platform where product experts monetize their knowledge and assist consumers in making informed purchases.
• Eddie has raised over $141 million from notable investors such as Capital G, Greylock, and Forerunner.
• He is also an angel investor with investments in Telegram, Truebill, Applovin, and Dollar Shave Club, among others.
• Prior to Curated, Eddie worked at LinkedIn as the head of talent solutions, following the acquisition of his startup Bright in 2014.

"This is 20 vc with me, Harry Stebings, and today we're joined by a phenomenal serial entrepreneur, Eddie Vivas, founder and CEO of Curated, a network where product experts monetize their passion and help consumers make the perfect purchase."

This quote introduces Eddie Vivas and gives a brief overview of his current venture, Curated, highlighting his role and the platform's purpose.

• Eddie's path into technology was unconventional; he dropped out of high school, leading to a family fallout as his parents were first-generation immigrants and doctors.
• After moving to Miami to live with his grandparents, Eddie worked in a warehouse before realizing he needed to make a change.
• Leveraging his technical skills, Eddie started building websites, including a recipe website that quickly increased his income.
• He reinvested the earnings from his website into founding his first company, an ad tech business, which he ran for seven years before selling it.
• Eddie's entrepreneurial mindset was present from childhood, as he always sought ways to build his own businesses despite facing challenging times.

"I started building websites. I built a recipe cook quick website, and I went from making, like, I don't know, one, $800 a month to, like, $20,000 a month in a matter of six months."

This quote describes Eddie's early entrepreneurial success with a recipe website, which marked a significant turning point in his career from manual labor to technology and business.

• After leaving LinkedIn, Eddie leveraged the opportunity to work with respected colleagues who were not ready to transition to Microsoft post-acquisition.
• Eddie's team at Curated was formed before the business idea was fully developed, based on mutual respect and a desire to work together.
• The concept for Curated stemmed from the desire to talk to knowledgeable individuals when making important decisions, something beyond what Google's indexed knowledge could offer.
• Eddie's personal experience with purchasing inappropriate ski gear led to the realization of the value of expert advice, which became the foundation for Curated's business model.

"We meet at the base, and the guy's like, this is all wrong... Turns out that was for experts. I'm a beginner. Guy goes into a shop, rents me a bunch of the most basic stuff, I go back out, absolutely have an incredible time."

This quote captures the moment Eddie realized the importance of expert advice in purchasing decisions, which inspired the service that Curated provides, connecting consumers with experts.

• Eddie's approach to work changed from valuing long hours at the office to focusing on long-term impact and building the right foundations.
• He believes that being a serial entrepreneur provides an advantage, as investors trust that you will figure things out, allowing for a long-term mindset.
• Eddie values investing in failed entrepreneurs, seeing the humbling experience of failure as beneficial for future success.
• He acknowledges the challenge of balancing a long-term focus with the need to maintain interim velocity in execution.

"The biggest thing that I was known for was I cared a lot, but I was very intense... Really, that's just a quick way to burn out people."

This quote reflects Eddie's reflection on his earlier management style and the realization that intense work hours do not necessarily equate to impact or success.## Building Sustainable Business Foundations

• Curated aims to build a sustainable business by focusing on the right foundations.
• Many businesses have failed due to scaling without proper fundamentals.
• The focus is on building the necessary infrastructure to support long-term success.
• Urgency is balanced with meticulous development to ensure a strong foundation.

We're going after something, at least with curated, that's really ambitious and that's about going slow. It's about doing things the right way because we're doing something in a place where a lot of people have failed in the past because they didn't actually build the right foundations.

This quote emphasizes the importance of building a business with the right foundations, especially in a field where others have failed by scaling too quickly.

• Determining "the right things" for a business involves distinguishing between "nice to haves" and "must haves."
• For Curated, ensuring customers are connected with truly exceptional experts is essential.
• The company must vet experts thoroughly, requiring strong technical, communication, and reliability assessments.
• A significant infrastructure, including a social hiring platform, is necessary to manage expert-customer connections effectively.

The thing that we learned was if you're coming to us to be able to chat with an expert, we need to make sure that every time you're connected to an expert, they're an incredible expert.

This quote highlights the critical need for Curated to provide customers with access to highly qualified experts, which is a cornerstone of their business model.

• Curated faced unique challenges that made off-the-shelf solutions inadequate.
• The company's B2B approach in a B2C business required custom-built tools.
• Building rather than buying allows for a seamless integration of solutions that are critical to the business.
• Custom-built solutions can create strategic value and provide a competitive edge.

One of the things we've come to terms with is if I stack a bunch of 90% solutions on top of each other, it gets really mediocre really quickly.

This quote explains the rationale behind building custom solutions instead of relying on pre-existing ones that may not fully meet the company's needs.

• It takes time and experience to differentiate between essential features and those that are simply nice to have.
• Startups often fail by scaling prematurely or never finding product-market fit.
• Focusing resources on core problems is crucial to success.

Startups fail for one of two reasons. They either scale before they find product market fit, or they never find product market fit.

This quote outlines the common pitfalls for startups, emphasizing the importance of finding product-market fit before scaling.

• Curated has achieved product-market fit, as evidenced by high conversion rates, low return rates, and customer willingness to tip experts.
• Analytical data and gut intuition both play roles in recognizing product-market fit.
• The company has worked to ensure that the "magic moment" of connecting customers with experts occurs consistently.

The challenge was that magic moment was happening, like, 20% of the time because it was taking us 30 minutes to connect you with an expert, or we were connecting you with the wrong expert, or we weren't bringing in the right type of consumer.

This quote describes the initial challenges Curated faced in consistently delivering its core service and the importance of refining their processes to improve the customer experience.

• Scaling too quickly, especially with abundant capital, can lead to failure.
• Hiring the right people, with a focus on those who believe in the mission (missionaries), is crucial.
• A strong company culture and careful hiring are essential to prevent issues related to rapid scaling.

Fucking it up for me was lowering my bar on trying to get people to join my company because we were slow on hiring.

This quote conveys the speaker's concern about compromising hiring standards to accelerate growth, which could lead to long-term problems.

• Missionaries are deeply interested in the business and its challenges, while mercenaries are primarily motivated by compensation.
• Equity-focused compensation models attract individuals who are invested in the company's success.
• Transparency about the challenges and rewards of working at a startup helps identify and retain missionaries.

If your team are large equity holders in the business, your problems are now their problems.

This quote underscores the philosophy that offering significant equity to employees aligns their interests with the company's, fostering a collaborative and dedicated workforce.## Equity Distribution

• Eddie Vivas believes in equal partnerships and is against the CEO always having the largest equity share.
• He suggests that bringing in someone with significantly less equity implies they are not seen as equals.
• The approach is to offer equity compensation at the 99th percentile, leaning towards generosity.

"I'm a really big believer in equal partnerships. I always think that means you brought in somebody who you don't believe is equal to you."

Eddie Vivas emphasizes the importance of treating co-founders as equals, suggesting that unequal equity distribution may indicate a lack of confidence in a partner's abilities.

• Eddie acknowledges potential past mistakes in compensation plans, possibly being too conservative.
• He highlights that startups are not suitable for everyone, and over-generalizing compensation can dilute the value for those who are truly committed.
• Past focus on cash compensation has shifted towards getting people to care about the business's health.

"I'm sure I've made mistakes. Yes, I'm sure. But I can't think of any of them right now."

While Eddie cannot pinpoint specific errors in compensation plans, he concedes that mistakes were likely made, reflecting the common challenges in startup compensation strategies.

• Eddie advocates for transparency with employees, as intelligent team members will uncover the truth regardless.
• Transparency provides context for decision-making and affects how capital is spent.
• He believes that hiding information only works with mediocre teams, whereas smart teams will see through it.

"Smart people are going to figure it out. So you might as well be straight up with them."

Eddie argues that honesty with employees is essential because intelligent individuals will deduce the company's situation, making transparency a strategic choice for informed decision-making.

• Eddie admits to numerous hiring mistakes, particularly when convincing people to join the team.
• He has learned that selling a dream that may not materialize can lead to demoralization and low impact.
• Trusting one's gut is crucial, even when candidates have impressive backgrounds.
• Hiring slowly is preferred to ensure a mutual fit, as frequent departures can harm team morale.

"The biggest mistake I've made in hiring is trying to convince people to join us."

Eddie reflects on the negative consequences of persuading individuals to join a company, which can result in disappointment and reduced effectiveness if the promised vision fails to materialize.

• Eddie challenges the notion that quickly filling positions is beneficial, arguing that it may not extend the company's runway.
• He criticizes the focus on vanity metrics over genuine value creation.
• Eddie believes that entrepreneurs should demonstrate progress through meaningful achievements rather than superficial numbers.

"I'm not sure that spending my money faster is going to help my Runway."

Eddie questions the efficiency of hiring rapidly to appease investors or to show quick progress, suggesting that thoughtful hiring and genuine progress are more sustainable strategies.

• Eddie does not entirely blame VCs for the pressure on startups to scale quickly.
• He acknowledges the current excess of capital and shortage of high-quality entrepreneurs.
• Eddie emphasizes that raising capital is not equivalent to success and that actual business performance is what matters.

"Capital is super ubiquitous. People want to hit certain goals because they want to puff up their valuations even higher."

Eddie observes the abundance of capital in the market and the tendency for startups to chase high valuations rather than focusing on building a sustainable business.

• Eddie is proud of the low take rate on secondary offers at his company, indicating a strong belief in the company's future.
• He recognizes the need for liquidity events for long-term private companies and supports providing them for significant life events.
• However, Eddie is critical of early-stage founders taking large sums off the table, as it sends mixed signals about their commitment.

"Some life happens, and if you have a very long journey, you need liquidity points."

Eddie acknowledges the practicality of secondary markets for founders and employees in specific circumstances, balancing the need for personal liquidity with the commitment to the company's growth.

• Eddie's perspective on money has shifted; he now sees it as empowering rather than a source of happiness.
• He finds greater fulfillment in creating wealth for others and believes in the importance of finding purpose beyond financial goals.
• Eddie emphasizes the diminishing returns of money once basic needs are met.

"I personally generate more happiness creating wealth for others than for myself."

Eddie reflects on the greater satisfaction derived from helping others achieve financial success, suggesting a community-oriented approach to wealth.

• Eddie has learned the importance of respecting employees' family commitments.
• He advocates for a work culture that prioritizes family over work, recognizing the negative consequences of pressuring employees to neglect family for work.

"The one thing I've learned is don't screw with people's kids."

Eddie stresses the importance of allowing employees to balance work with family life, indicating that a supportive work environment is crucial for employee well-being.

• Eddie admits to having more weaknesses than strengths as a leader but compensates by building a strong team.
• He values team members who can organize his thoughts and push back on his ideas when necessary.
• Eddie fosters a company culture where everyone feels comfortable voicing opinions and challenging decisions.

"I suck in more places than I'm good at, but what I'm very good at is surrounding myself with a team that covers my weaknesses."

Eddie candidly discusses his leadership approach, focusing on team collaboration and leveraging the strengths of others to balance his own limitations.## Company Culture and Debate

• Eddie Vivas highlights the absence of titles within his company to encourage a culture of equality and open debate.
• The company actively seeks individuals who are comfortable with engaging in rigorous debate.
• Meetings are rarely concluded with heated emotions but involve intense discussions.

Well, a couple of things. For starters, one of the things we did was we don't have titles of the company.

This quote emphasizes the deliberate choice to remove job titles to foster a more egalitarian environment where ideas can be freely exchanged without hierarchical constraints.

The second thing is, we interview just very, very aggressively for people who feel comfortable with debate.

Eddie Vivas explains that the company's hiring process is stringent on the aspect of comfort with debate, indicating the importance of this trait in the company's culture.

• Key meetings within the company are thoroughly documented.
• The company culture is analytical, with a focus on data to support claims.
• Employees are expected to substantiate their statements with accurate data, as inaccuracies are quickly challenged.

They're all very documented and we're very analytical as a company.

Eddie Vivas describes the company's methodical approach to record-keeping and analysis, which is a core aspect of their operations.

People will call you out very quickly because we're all very deep in the data.

The quote reveals the company's emphasis on data accuracy and the expectation that all team members are well-versed in the data relevant to their work.

• The company values both fully formed and spontaneous ideas.
• Eddie Vivas warns against discouraging enthusiastic new employees with too many barriers to idea execution.
• The company utilizes operating priorities to guide which ideas to pursue and measure their impact.
• Balancing ideation and execution is crucial, avoiding both the stifling of creativity and the lack of follow-through on ideas.

There's a time and place for both.

Eddie Vivas acknowledges that there is a need for both structured, data-backed ideas and more natural, organic thought processes within the company.

The worst thing that you can do, in my opinion, is take somebody who comes in and they're super excited when they join a company, they have all these big ideas and they get shut down.

This quote explains the importance of not immediately dismissing new ideas, especially from enthusiastic new hires, to maintain a creative and dynamic work environment.

• Founders often focus too much on valuation rather than finding the right investment partner.
• Eddie Vivas prefers to set a fair price for investments rather than engaging in an auction process.
• A good investor should add substantial value beyond capital, challenging and guiding the business.
• The right team and investors are crucial for a company's success.

I think that people over index on valuations and not on finding the right partner.

Eddie Vivas criticizes the common founder mistake of prioritizing investment valuation over the quality of the investor relationship.

Smart money and really strong investors will really call you out on your bullshit, push you on.

This quote highlights the value of having investors who are not just financially supportive but also provide critical business guidance.

• Eddie Vivas finds saying no to be the hardest part of his role.
• Hiring for the head of brand is particularly challenging due to the importance of the role and the salesmanship of candidates.
• Vivas desires a startup world with less pretense and more transparency about the difficulties of entrepreneurship.

Saying no.

A concise response from Eddie Vivas identifying decision-making, particularly rejection, as a challenging aspect of his job.

Less smoke and mirrors.

This quote conveys Eddie Vivas's wish for a more honest portrayal of the startup industry, acknowledging the hard work and challenges involved.

• Physical activity, extended time off, and discussions with understanding individuals are key to Eddie Vivas's decompression.
• He emphasizes the importance of truly disconnecting from work to relax and reset.

I need at least a week for me to actually start to slow down and chill out.

Eddie Vivas explains that short breaks are not sufficient for him to unwind, indicating the intensity of his work and the need for substantial downtime.

Spending time with people who truly get me and can help me think through problems.

This quote reflects the significance of having a supportive social circle that can assist with problem-solving and contribute to relaxation.

• Curated aims to be the go-to platform for expert advice across various domains.
• The goal is to extend their services beyond sales, such as helping customers with related activities like trip planning or sleep training.
• Eddie Vivas envisions a future where the company's human element enables a range of services that are currently unexplored.

We want to be the place you go to for all expert advice.

Eddie Vivas expresses the company's ambition to become a comprehensive source for expert guidance in multiple areas.

Able to help as many experts as possible monetize their passions.

The quote outlines the company's mission to empower experts to earn from their knowledge and skills, expanding the scope of the business beyond mere transactions.