Earlier this month, HIGHLINE portfolio company Learndot was acquired by ServiceRocket, a Palo Alto-based company that offers software training, support and consulting to enterprise clients.
“ServiceRocket is a talented, ambitious company with training expertise very complementary to what we have at Learndot,” said Learndot CEO & Co-Founder Paul Lambert in a blog post. “Nothing at Learndot is being shut down – in fact we expect everything to only get better.”
Exits can be intense, stressful, and exciting. Inevitably, they also catalyze powerful points of reflection in the journey of an entrepreneur. More than numbers on a page, these are moments that capture a story, emotion, and perspective, so I caught up with Paul — who recently started as a Product Manager at Twitter — to talk about his journey from GrowLab, to San Francisco, to exit.
Q&A With Paul Lambert
You spent five years building and growing Learndot. What were some of the key lessons you learned along the way?
You learn a lot in five years… you do so much in that time period. I wrote a post a while ago on Four Rules for Starting a Startup. I truly believe in all four of those things – I definitely learned them the hard way, and I can’t say one is more important than any other.
The first rule is to solve your own problems [or in the article, “build for yourself”]. That’s a fairly common one, and not everyone agrees with me. Great products are made through empathy — by that I mean your ability to feel what the customers or users feel — and passion. Some people confuse passion with ambition, but it’s really about how badly you want to see your solution in the world. If you experience the problem you’re trying to solve firsthand, then without trying, you have passion, because you want this thing to exist. That said, there are a lot of companies that weren’t built like this, but the probability of success is higher with ones that do.
How did Learndot evolve over the years?
There were so many pivots and so many changes. We started off as a learning management system for UBC. When I started Learndot (initially called Matygo), I knew I wanted to be an entrepreneur but wasn’t too strategic about it – we didn’t have a business plan, we just started building it while still at the University of British Columbia (UBC). It did well in terms of adoption — people were using it — but it didn’t have a good business model, and it was hard to monetize.
We went through this identity crisis when we graduated from GrowLab (2011). From a 10,000 foot view, it might not look like a big pivot, but it was. We threw out all our products, the market shifted completely, we rebranded from Matygo to Learndot — we did a hard switch. The only thing we didn’t change was the mission: we wanted to help make learning more efficient, and help people gain skills they wouldn’t have if we didn’t exist. That was the case whether we were building for universities or for fresh grads learning marketing skills for the latest software products. Now someone fresh out of school can get a community manager certification, and get concrete skills, and have better job opportunities as a result.
You left Vancouver for San Francisco. How did that decision shape the business?
Once we decided to start serving software companies as our primary customers, moving to SF was a no brainer – it was a way to be closer to our customers, and closer to financing, and everything else that makes sense for startups. Silicon Valley is unlike anywhere else in the world. I don’t think anywhere else is even 20% as dense in terms of startup population – it’s almost hard to grab coffee and not run into someone who has built an amazing company, or is in the process of building one.
My successful transition down here was definitely facilitated by my experience with GrowLab. We spent a week down here, and worked on building our networks. It made a really soft landing for me.
Originally it wasn’t the whole team who came down – the engineering side was left in Vancouver. Initially I came down here with the idea to do fundraising, grow our customer base, and set up shop in San Francisco. I got lots of investor meetings, and got to the final round of a couple really great funds, but didn’t get any term sheets and kind of got burned by the process.
After that I thought we needed to grow a more stable business… if I could get the company to be profitable, I’d have better numbers, and I also wouldn’t need investors, which puts you in a stronger position. So instead we focused on getting more customers. I worked on building our customer base between Vancouver and San Francisco for about a year.
In the mean time, I’d built a relationship with ServiceRocket. We’d actually beat them in a customer battle, which is how we showed up on their radar. After we beat them, Rob, the CEO, invited us to his office, said he’d buy us lunch, and offered to mentor us.
He was the first one in the round when we went to raise financing. Rob kind of opened the idea that instead of him just investing in the round, he’d be interested in acquiring the whole company.
From there, it was a really long process. I’d say it was a year and a half from when he first reached out to us about that customer deal — and the acquisition discussion started a year after that initial conversation. The legal process itself took three to four months.
I honestly don’t think we would have been acquired by ServiceRocket if we hadn’t moved down here. I was only able to build the relationship with Rob because we were able to grab coffee all the time. Maybe we would have had a phone call, but it’s much more likely that we would have ended there.
I think one of the big rules for location is be close to your customers. For us, we were supporting software companies, so coming here made sense.
What was the GrowLab experience like for you?
I think GrowLab was really useful for first-time founders, particularly people without strong networks. The thing that was most helpful for us was that it gave us a spotlight and validation. Prior to joining, we were just a nameless startup – after we joined, we got some external validation that made a big difference. An accelerator makes your life easier, because all of a sudden you can sell better to anyone… founders are always selling. Once you have that validation, it’s easier to get customers, investors, and the press to write about you because you have some social proof.
As for the program and mentorship, you kind of up-level your network and expectations. I work – and I think most people work – better when surrounded by ambitious, smart people who can accomplish things, and that definitely happened there.
In retrospect, the mentors were great, but the people I still keep in contact with and will grow with throughout my career are the other founders I met in the cohort.
What advice do you have for new founders joining HIGHLINE?
Advice… you get a lot of advice. Maybe my advice is to be wary of listening to advice too much. Everyone has strong opinions, especially in this world – and it’s way easier to give advice than build a company. Not that they haven’t done it, but you being the founder has to live with the consequences.
At the end of the day, you have to trust your gut and ignore a lot of stuff you hear. The hardest skill you gain is the filtering skill, and being able to parse out what makes sense for you and what you want to build in the world. People who do that successfully don’t lose track of who they want to be, both as an individual, and as a company.
Have a very clear vision of your future, the career you’re trying to build, the company you’re trying to build, and what success means to you. Write that down before you start HIGHLINE, and use that as your guiding compass to filter the advice you get – from finance to recruiting. Build your own personal mission statement.
Follow Paul on Twitter: @prlambert