Jeff Bussgang, a veteran entrepreneur and VC, shares his insights on startup success, emphasizing execution, adaptability, and the importance.
Jeff Bussgang, a veteran entrepreneur and VC, shares his insights on startup success, emphasizing execution, adaptability, and the importance of experimentation. He highlights the role of world-class teams, large markets, and a bit of luck in venture capital pattern recognition.
And let's say you're able to show up and have a conversation with that younger Jeff and you're able to give that younger Jeff one piece of advice before launching a business. What would that be and why given what you know now? I Amazon stock. [Laughter] I love it. I love it. All righty. Hello everyone and welcome to the deal maker show. So today we have an amazing guest. You know we have a guest that I've been a fan for uh for for quite some time now and you know we're talking about a founder a founder turned investor. He's also written some really exciting books uh the latest one. We're going to be talking about it today as well and again you know brace yourself for a really incredible conversation about you know everything that you can think of. You know whether it's building scaling financing exiting he's done it all. He's also doing it right now from the other side of the table. And
without further ado, let's welcome our guest today, Jeffrey Bushang. Welcome to the show. Thanks, Alejandra. Great to see you. So, originally born in the Boston area in 1969. So, give us a walk through memory lane. How was life growing up for you? Yeah, I was actually born in Cambridge, just across the river from Harvard University. And uh my dad was a tech entrepreneur who had survived the Holocaust and came to Boston to go to MIT and then earned his PhD at Harvard. While he was at MIT, he came up with a theorem called the Buskang theorem which is a well-known theorem in the world of applied math and physics. And uh so I very much had a technical kitchen table MBA uh with a tech entrepreneur dad back in the 60s,7s and 80s. Uh taught myself how to program back in the PC era. fell in love with the Apple 2, 2 Plus, uh, Pet Commodore, the whole thing, and went to Harvard and studied
computer science at Harvard. I Alander I I sort of blush when I say this, but in 1987 as a freshman, I came to Harvard to major in computer science and AI in particular. So, NLP, neural networks, etc. Uh, it's it's sort of a funny thing to think about the arc of of these things that four decades later, I'm still working on and investing in AI. I mean AI nowadays the consciousness is absolutely crazy compared to back then. So I guess what caught your eye around AI back back then. Well I fell in love with the idea of natural language processing and the ability to communicate with AI passed the touring test parse grammar language uh read I took graduate courses in NLP and computer vision to read and recognize images. I just thought the whole area was was fascinating. So obviously problem solving sounds like it was exciting to you know being an engineer right now. One of the things that that
to further shape that you know you went to New York and you went to the Boston Consulting Group and what I like about the consulting world is that it allows you in firms in firms like BCG to be able to grab one big problem and kind of like break it down into small problems so that then you can tackle them. You know also how do you think let's say the experience of being in the consulting world you know help you with the way that you approach problems as well? I think you said it beautifully analytical thinking problem solving strategic thinking value pools and value creation and of course I became very skilled at PowerPoint which is an important skill uh communicating at a very young age and uh and synthesizing complex issues and problems at a very young age. So business school obviously it had to be Harvard you know which has been you know in your heart since since the beginning in your
career I guess what do you think push you towards you know shifting gears and and going back to business school. I wanted to be a tech entrepreneur like my dad and simply put I thought an MBA would be beneficial and I was very lucky in 1993 when I arrived 1994 I saw the Mosaic browser and completely fell in love with the idea of the internet as a potential business environment. Wrote what was one of the first articles in Harvard Business Review on that topic and joined a seedstage internet startup in 1995 when I graduated in the spring of 95. Now, back then, you know, probably you had a bunch of classmates that were starting their own companies. I mean, you knew you wanted to be a tech entrepreneur, too. So, why did you join, you know, another team versus going out of your own? Well, first I'll say no one was starting a company back then. Absolutely no one. I was one of only a handful
that went into an internet startup. And I just loved the idea of the company, Open Market, which was backed by Greylock, had raised a couple million dollars, had a small team, and had this vision, a very ambitious vision at the time in 1995 of turning the internet into a commercial environment and providing the tools and the platforms and the infrastructure to enable that. And how was that journey like? Because you guys took the company public. You know, there was the unicorn valuation. I mean, that's quite the experience for being the first rodeo. Yeah, it was a rocket ship going public in 1996 uh at a time when not a lot of internet companies were going public at billion-dollar valuations. The I think 20 years before Alien Lee coined the term unicorn. We were a unicorn and uh we really just had a a terrific rocket ship ride and I had the opportunity and and privilege of learning how to
split scale and and in the language of today and build a a valuable company in a very rapid time frame. We had a sign outside of our office window facing the highway in Kendall Square. Can you code? You know, visit openmarket.com. Uh we hired a few hundred people in the first year or two, scaled very rapidly, built uh a lot of products and um and I had the privilege of ending up on the executive team well before I was ready and I just had an amazing ride. and also the privilege of being exposed to complex situations like for example a you know tense you know let's say communication or situation between the CEO and the founder what happened there yeah it's a classic pattern that we see time and time again in the startup ecosystem when after we had gone public we had hired just before we went public we hired a professional CEO who was an amazing leader and the founder stepped aside and
became board chair and the professional CEO took us public built a professional management team changed over the team. I was the one remaining sort of hold over from the founders era to the executive uh professional executive era and uh you know fights about or disagreements about strategic direction ensued. some fights ensued and the two decided that u the other should be uh no longer around and and only one of them there was only room for one of them and so the board had to make a decision and and those are very difficult decisions for boards to make and boards don't have all the information and they asked a couple of us on the executive team our opinion and you know sort of have that dramatic boardroom where you're sitting in the waiting room the board invites you in you walk in there's a panel of board members in my case I'm still in my 20s everybody's very senior this you billions
of dollars at stake and uh you know we just we just had very difficult conversations and made difficult decisions. I ended up sticking with the professional CEO who who did a fantastic job. I'm still friends with both both parties and um and ended up being you know a great outcome for the company. We ended up at the time that I left in uh late 1999 early 2000 at a 2 and a half billion market cap and uh you know the company was really an important player in the in the internet 1.0 infrastructure days. So let's talk about that moment where you leave because you left to now take the reigns of your own future and to really you know become an entrepreneur and and start your own business. So you promise so how does the whole idea of you promise come knocking to you? So the um founder of General Catalyst, David Fialco, uh had just started General Catalyst and reached out to me and connected me
with uh a guy named Michael Bronner who had been a marketer, had started a firm called Bronner Comm, Bronner Slober, which had then turned into Digitas, gone public, been very successful at the marketing world. Ando had this vision along with Michael Bronner of creating a loyalty program and combining loyalty marketing, Michael's expertise with the internet and internet commerce, my expertise. And so he introduced the two of us. Um, we fell in love professionally and uh developed this company together uh and had just a great run building a what ended up being a financial services backend behind a loyalty front end to help families save money for college like a frequent flyer program through their everyday spending and that money would go into a tax-free 529 account which had just been created by the Bush administration. So obviously there you also survived the dotcom crash you know which
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