🎙️ On launching the first major online cosmetics company, despite being told repeatedly “women won’t shop online”
🎙️ How Minted.com unlocked the creative genius of thousands of designers around the world
🎙️ Why the more we live online, the more we value art and handcrafted objects
🎙️ What it’s like to raise $400 million … and counting
This episode is for anyone who enjoys entrepreneurship, art, and the power of perseverance!
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⁉️ Exclusive tease: Mariam’s new venture, arcade.ai, launching soon!
🤘 Mike's favorite art picks every week, recommended books for leaders, and more: mikesteib.com.
🎉 Up next: More from the world of art and design with another one of my favorite CEOs. Submit your questions at 213.419.0596.
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:04):
Welcome office hours. We sit down with the chief executives
shaping the world and answer your most pressing questions about leadership, careers,
and life. I'm Mike Stive and today we have the
pleasure of chatting with my friend Mariam Nafisi. Mariam is
a serial entrepreneur and a perennial rockstar of the tech
startup world. She pioneered online cosmetics with her startup eve
(00:27):
dot Com in nineteen ninety eight, which sold for over
one hundred million dollars. Mariam later disrupted the cards and
stationary industry with Minted dot Com, one of the first
companies to unlock the power of crowdsourced designs from independent artists.
She now leads Heretic Ventures, a venture studio that is
launching new startups in the creator economy, including most recently
(00:48):
Tonic Labs of Marketplace for Generative Digital Art. Mariam sits
on the board of directors of Minted, Medium, Victoria's Secret
and Every Mother Counts. She is a trustee of William's
College and a member of the Advisory Council of Stanford's
Graduate School of Business, and she's the author of The
fast Track, The Insider's Guide to winning jobs and management, consulting, investment,
banking and securities trading. Marry him. I'm so glad you're here.
(01:12):
Welcome to the show.
Speaker 2 (01:16):
Thank you. It's wonderful to be here.
Speaker 1 (01:18):
So we first met when I was running the not
I was planning weddings and you were ad minted and
you were you all were selling wedding invitations. So we
were like we were destined to be friends. But it's
been a few years since You've been good.
Speaker 2 (01:30):
I have been I've really enjoyed really taking a break
from being a full time operator and CEO and being
able to sort of keep tabs on many many developments,
technology developments and trends happening and really spend a lot
of my time studying just really studying what's happening, studying
(01:50):
new technologies. And I have a nice, wonderful group of
colleagues at heritaic Ventures who I love working with.
Speaker 1 (01:57):
Awesome. Well, we got a bunch of questions on your
journey is as an entrepreneur and as an operator, how
you generate ideas for the next big thing, all of it.
So if it's all right, we'll jump into we'll jump
in with the audience wants to hear from you and me.
All right, so the first question is from Barry in Dallas, Texas.
Speaker 3 (02:14):
Hey all, I'm Barry calling from Dallas, Texas. I'm in
investment banking, but lately I've had an h to do
a little more. In Mariam, you wrote a book about
in consulting in banking jobs, then you turned entrepreneurship later.
I wanted to ask you how did you know that
that was the move for you and also when was
the right time to make the lead?
Speaker 2 (02:32):
Thank you very much.
Speaker 1 (02:34):
Do real entrepreneurs work in investment banking and consulting and
go to business school? Obviously? The answer today is yes, yeah.
Speaker 2 (02:41):
You can. You can because you could find somebody who's
actually not a good match with investment banking. In investment banking,
they might be a better match with entrepreneurship. And I
have found other people like this who left and actually
went to start things because they realized, you know, find
this is a great background. It helps you with the
language of your raising capital. Subsequently, I've raised I've raised
(03:04):
a lot of capital. I think my latest talent it's
almost close to four hundred million now for my different businesses,
which is pretty crazy. But you know, it's something that
grounds you and being able to have a language that
you can share with investors, which is not a bad background. Yes,
computer science these days is great, but finance isn't bad.
(03:26):
And being quantitative and metrics oriented isn't a bad way
to go either. Anyway, So I ended up going back
to business school, but really with this intention that I
would never enter you for a job coming out, and
I would fully focus on entrepreneurship and I would try
to make friends with people who could get me access
to capital, which at that point was a big concern
(03:46):
of mine. I thought, you know, honestly, as a woman
and as a minority woman, I was not sure that
I would be able to raise capital as easily. And
I thought that if I went to the Stanford I
would meet people who were in the venture capital space
who I could make connections that would help me raise
capital later. And that was one of the major reasons
(04:07):
that I decided to go. And then I started and
then I started starting businesses.
Speaker 1 (04:11):
And I have multiple friends who started their businesses in
or on the way out of business schools, so that's
not wildly uncommon. Yeah, yeah, And yet we have this
archetype of sort of every founder is a college dropout
and is nineteen and has nothing to lose. But you
had actually developed a real base of understanding of what
(04:31):
you were going to do as a leader and as
an entrepreneur.
Speaker 2 (04:35):
Yeah, that's right. I think that's right. At least I'd
seen some businesses how about that? And I started to
understand strategy, and then the business school gave me the
sort of a toolkit to understand what was out there
in terms of research frameworks to solve problems. I mean,
for example, how do you design compensation inside a company?
(04:55):
It's kind of tricky. Actually, we studied that, and there
were some people who really were very, very expert at that.
And at that time it was not the industry of
raising money was not as transparent. So being able to
sit in IRV gross Backs Entrepreneurship class and understand that
venture firms could at that day in age collude with
(05:16):
each other to negotiate with you, for example, that there
were things like that that could happen that you needed
to understand work your way around a term sheet. Those
were things I learned. I learned a lot a lot
about that at Stanford.
Speaker 1 (05:31):
It's funny you mentioned compensation. I had some young entrepreneurs
had come to me years ago and had just started
their business and told me some of their management insights,
including that they thought it was ridiculous that people got
paid different amounts of money for different jobs in the company,
so everyone would have the same compensation. And I was like, man,
I cannot wait to see you guys again in two hours.
(05:52):
I can't wait. Learning by doing is you guys are
could have a great time.
Speaker 2 (05:57):
Yeah.
Speaker 1 (05:58):
So you had you at eve dot com just it
was a pioneer in the online cosmetic space, and then
later Minted dot com, where you and I met that
One of the dms I got was from Keighley in
New York City who wanted to hear from you. Everything
seems to be moving to digital. People meet online, shop online.
(06:18):
Some people are even apparently dating their AI companions. You've
both made a business of physical goods from creators. Are
you surprised there's so much demand still for objects like paper,
invitations and paintings.
Speaker 2 (06:35):
I'm not particularly surprised, but I sometimes think, gosh, am
I am I? This is when I started Minted. I thought,
am I just starting a niche business that only I
am going to care about?
Speaker 3 (06:45):
You?
Speaker 2 (06:46):
Know, beautiful luxury cards that really express you know, your
express your your personal style and taste and design and
your and then send greetings and love from your family.
Am I the only one? Maybe it's a small group
of us, but that's okay, you know, we're going to
go after that group. I think that there are not everyone,
(07:09):
but there's a substantial I would say there's a substantial,
substantial majority of the country that has something physical in
their lives that they care about. Whether it's a car
or it's a you know, a beau, a beautiful set
of you know, ceramics, or a beautiful painting on the wall.
(07:30):
We are living in the physical world and there's probably
something in each person's life, a piece of jewelry that
they care about. That everyone. I think everyone probably if
they think about it, you know, there's something they care about.
And if you just look at consumer spending on what
we spend on, you know, one one would argue that
there are important physical objects for everyone in the US.
(07:53):
So I think I'm not terribly surprised for paper cards
in particular. I think for minted, you know, it's what's
happened is you send less mail, but the pieces of
mail that you do send are very have become much
more important because it's so rare to get a piece
of mail, and so your wedding invitation, you know, or
your annual holiday card, those things that are really meaningful.
(08:16):
There are a few things left that people want to
receive in the mail, and then they spend they spend
more on it and they yeah, they're more thoughtful about it.
Speaker 1 (08:24):
It feels to me as a recipient too, that I
get far more holiday cards than I used to, probably
thanks to you having reduced a lot of the friction
that used to that it used to entail, used to
have to hand address and all of this stuff, and
now you can do it very, very seamlessly through formed
Thank you.
Speaker 2 (08:43):
We've tried. Yeah, we want to. We want to. It's
fun to have to think of your friend receiving a
piece of mail from you, opening it up and getting
that surprise of the family photo, your family's photo, updating
people on what your kids look like now, how grown
up they are. I mean, it is fun to imagine
your friend's open that card. And so I think there
we want to keep the fun in it and take
(09:03):
the friction out of it absolutely like not make it
difficult for you to have that fun and that experience.
Speaker 1 (09:08):
Well, I also found, you know, at arts where we
sell we sell physical paintings, we had more growth and
painting sales and just and in straight traffic to the
website and the app in the year where we all
started working remotely right after COVID, so we all migrated
from the physical world to the cloud, and the demand
(09:31):
for physical objects in our experience just went up. Because
when you step out of the cloud and you step
out of zoom and you're back in your physical world,
you want it to you want it to be a
place that that gives you endorphins, a place that that
fills you with joy. Now I want to go back
(09:55):
to something you touched on in the introduction, and we
heard this from one of our our listeners, Lucy and
San Francisco had hit me up on LinkedIn and wanted
me to ask you, Mariam is a woman starting businesses
more oriented towards women, How hard was it to convince
predominantly male venture capital firms to support you.
Speaker 2 (10:17):
It is a little bit more difficult when you're dealing
with products that largely target a female audience. With Eve
dot com, which was the first cosmetics company online, which
I started in nineteen ninety eight and sold in two thousand,
just before the bubble burst. The you know, we were
so early at that point that shoes were not being
(10:39):
sold online, clothes were not being sold online yet. I remember,
you know, we had launched and the Zappos launched right after.
But people were saying to us, you know, cosmetics are
never going to sell online. And this is more maybe
a message to all the would be entrepreneurs out there
that you're going to get a lot of very people
who are very certain about their opinion. And you know,
(11:02):
I think part of entrepreneurship is persisting and believing that,
you know, believing that some of the rules can be broken.
But we were told that women will not shop online,
and that cosmetics would not shop, would not be sold.
And of course we know women are huge purchasing for
us now online. I think it's something like sixty to
seventy percent of everything purchased online is actually bought by women,
(11:25):
just like in the real physical world, and cosmetics we
all know sell very well online. So we had a
lot of doubters on that. Same with Stationary. Stationary people
also said, no one's going to buy paper products online,
same thing. Very very knowledgeable, very knowledgeable people, and it
was very discouraging to have a very knowledgeable person say
(11:46):
this is not going to work. Because somebody you really
respect says that to you. It's scary. It's really scary.
And you know, three hundred million dollars later, which is mint,
it's about three hundred million in sales. It's funny.
Speaker 1 (11:59):
I'm kind.
Speaker 2 (11:59):
I'm really glad I didn't I'm glad I didn't listen.
Same with the cosmetics thing, because we launched in nineteen
ninety nine, we raised in ninety eight, launched in ninety nine,
the beginning of really in the early days of e commerce.
We turned the side on and we thought we were
going to be selling replenishment products, like you know, skincare
(12:19):
that you already know that you like and then you
just replenish. Instead. All the color cosmetics like eyes shadows
and blushes and things that you really need to try on.
All of that's just started flying off the shelves the minute. Seriously,
the first hour we opened. Cosmetics, color cosmetics flying off
the shelves all over the country, predominantly to people who
(12:42):
lived in areas where there was lack of access to
the really hot new brands, and that just started selling
like crazy. So I don't know, I think your question
so really, I think what I would do in this
case is just say, you know, if your face seen
that challenge, you just have to keep talking to more
investors until you find the one who believes in the
(13:05):
idea and who relates to the product. And that's what
we did. We found investors. Eventually. It's a little tougher,
a little slower sometimes, but you eventually find And by
the way, at this point, things have changed so much
since ninety eight that I would say there are a
lot of male investors who have really tried to put
(13:25):
themselves in the shoes of the female consumer. And really
especially when the markets are very large, and they can
see that the market is very large, the tam that
you're addressing is really large that they can definitely come
around a lot faster than twenty five years ago. So
do not be discouraged. There is a path. There's an
investor out there waiting to believe in your idea if
(13:47):
it's a good idea, and then market is big enough.
I think there's an investor out there for you, And.
Speaker 1 (13:52):
I think This is why entrepreneurs so are so fun,
because it's so fun to work with because there are
people who've been told no, no, no, this won't work,
and they just persist it yeah, and found success. And
that's as you've encouraged the audience. That's what it takes
to be successful. Jordan and San Francisco asked us.
Speaker 4 (14:11):
You've both led businesses through the dot com crash, the
financial crisis in two thousand and eight and COVID, what
have you learned about surviving difficult markets?
Speaker 1 (14:22):
Mary Mint had got off to a slow start.
Speaker 2 (14:24):
I remember, Yes, Mint had had a tough beginning because
we started and then there was a recession. Then Leavin
Brothers failed immediately right after we raised, maybe two weeks
after we closed our round, the bank failed and we
were in a really bad recession. It was I mean,
(14:44):
I would say what I learned was that we had
to really focus on cash and runway and preserving cash,
preserving and runway, so there should be somebody if you're
if you yourself are not financial. I had a great
partner in Melissa Kim who just she's the kind of
person who can feel cash moving around intuitively, like she
can feel it going out the door. It was she's
(15:05):
very financially, very financially intuitively talented, so she was on
my side and she really helped me make sure that
we didn't run out of money and would basically nag
me to make sure that I cut costs and in
a good way, in a nice way. And so we
managed to hang on and get by on and build
(15:27):
this entire crazy e commerce business with a lot of
physical fulfillment needs and had to build a customization app
really on like two million dollars, you know, which was skimpy,
and so I had to be really creative. You know,
we hired. Everybody we hired was probably twenty two twenty three.
There were no there was there was no one we
could afford who was an experienced VP of something. So
(15:51):
it was it was a very young group of people.
But we had fun and I was steeped. I call
it being steeped in millennial bath because everybody I was
hiring was a millennial coming out of college at the time.
And you know what, that turned out to be a
huge win for us culturally, because you know, when we
for example, we sell our cards at Target now and
(16:14):
Target has told us, you know, you know you're the
millennial company. The millennial millennials love you, and I think
it's no wonder because the whole company, besides me, we're
all millennials, and every part of that culture and ethos
infused the company, and that was that's really a big win.
So sometimes like really positive things can come out of
those really difficult moments. But I would say the number
(16:36):
one is to act like you have half the cash
you do really cut if you're going to go through
a shake up like the pandemic, the sooner you address
the cost structure, the more optionality and that's a made
up word, but the more optionality you have, so days
and weeks count. We did a layoff within four weeks
(16:58):
of the pandemic, which was very fast, but we just
we just had much more wriggled room to save the
company and save everyone everyone else's jobs because we had
because we acted quickly.
Speaker 1 (17:10):
And it's such a hard thing to do. It's emotionally
so painful as a leader when you signed up to
take care of this team to have to to have
to tell people that they don't work at the company anymore. Yeah, really,
but they're at moments like this, it's it's that or
no one makes it, and so you have to make that.
You have to make that really difficult choice.
Speaker 2 (17:29):
Exactly. That's very exactly what what what I was thinking
is that I have to sacrifice some of the jobs
to save the rest, and that was difficult.
Speaker 1 (17:40):
I've also found I wonder if you have as well.
The teammates and employees who have been through a crisis
are just so much better at the job than those
who haven't. And we had we had a pretty big
gap between the financial crisis and COVID and and I
remember at the beginning there was this sense of like,
how is this bad thing happened? And when did the
(18:00):
bad things stop? And really I found our team and
as people came to the conclusion, they're like, bad things happen,
that's the job. It changed how everyone leaned into the
pain of these situations, and I think it made us
better professionals and better companies.
Speaker 2 (18:17):
I could not agree more.
Speaker 1 (18:19):
Alexa in Boston, I.
Speaker 4 (18:21):
Heard in an interview on Masters of Scale that you
raised more money than you needed a minted this year's
were notable for all the companies, so I found themselves
in valuation traps after raising it. Hyped valuations during the
recent venture boom. Do you staw have the same advice
for earlier stage companies?
Speaker 1 (18:37):
Mariam I, I recall I think I've read that you
had raised the most capital in a single year of
any female founder in America at one point. This may
be the reference that election that was.
Speaker 2 (18:46):
Later in our history. Once we had made it, meaning
once we had it, once we got past that recession
part where we only had two million. Yes, after that
we were we had a lot of offers to take
more capital, and we took a lot of capital. Some
of that, I'll be honest, was went out to shareholders
and secondary sales. Because we knew we were in it
(19:07):
for a long haul. We had to sometimes give liquidity
to employees and to investors, so some of that money
did A lot of that did not go into the company.
Speaker 1 (19:16):
Just to be clear, that's interesting because a lot of
people think, is an employee at an earlier stage company
or a privately held company, you will only see value
in your equity if you go public. But a lot
of companies do what you did, which is allow an
investor to buy up shares from folks who are already
who are already there, so that they get the benefit
of a lot of the hard work they've done.
Speaker 2 (19:36):
That's right, that's right. And I'm always thinking about liquidity
for the different shareholders like employees, investors, and I have
this preference to always if I'm going to do a secondary,
everybody across the entire cap table gets to participate. Employees
and investors, everybody, everybody gets to participate at the same
time because I want the I want employees to be
(19:58):
able to have some liquidity as we go towards a
very long term, long term outcome. So I would say
that I think, now, how do I feel? I think
it really depends on the industry you're in and how
competitive it is. So for example, if it's a very
competitive industry that's attracting a lot of capital moving very quickly,
(20:20):
I think it'd be best to accumulate funds quickly. And
that would be like the eve dot com situation where
we raised twenty six million in the first year of
business and we raised in I know this is going
to sound crazy, but I believe in fourteen months we
did four rounds.
Speaker 1 (20:37):
Wow.
Speaker 2 (20:37):
Yeah, and that was a that was a land grab moment.
So this is a moment where literally there this.
Speaker 1 (20:42):
One if you wanted to be online, you had to
build everything yourself. There was no Amazon Amazon hosting for
your website. You had machines on premise. You were building
your own content management system. Everything was everything home spun.
It was much more expensive.
Speaker 2 (20:56):
Everything was homegrown, exactly, custom code everything. And then on
top of that, it was a landgrad from a marketing perspective.
So we had television ads running. We had in our
first year, we had television ads running, we had print
ads running. We were such a big advertiser at condy
Nast that we were invited to the White House to
meet President Clinton. I mean it was it was absolutely
(21:18):
an insane experience. The whole thing is a twenty twenty eight,
twenty eight year old, twenty nine year old. But the
problem was that after we launched, we had four competitors,
all VC backed, launched in the market after us, all
of which had raised money. So that situation very competitive.
You're trying to build market share and awareness as quickly
as you can because really there a lot of benefits
(21:42):
in terms of awareness accrued to like a first mover,
and we were the first mover. We were the biggest
that that that's a different environment if you're dealing with
Minted where nobody nobody's really going into stationary There's not
much investment going on in e commerce at the time
in two thousand and eight. It's not fashionable to do
(22:03):
a direct to consumer company at that time. You have,
you can take it a little more slowly and you
can build up the capital. Also, I had different objectives.
Mint was meant to be a cash flow business, one
where you know, we we were trying to maximize cash flow.
I had a different lifestyle and personal objective in mind.
And entrepreneurs don't all have to be aiming towards like
(22:26):
a VC investment with a public company outcome. You know,
you could also be an entrepreneur who says I want
to build a lifestyle business with cash flow, you know,
and you could have you could build a different business
that has a lower revenue outcome, and it's really about
cash flow. And that's what Minted was actually originally supposed
to be. So then you could raise less money potentially
(22:47):
at this point in time. And also, by the way,
if you're willing to do all the VP jobs yourself
retain your ownership, you know, you're willing to do that,
and you're willing to hire twenty two twenty three year olds.
That's a different kind of HR approach and you need
less capital for that.
Speaker 1 (23:04):
So mid Journey has eleven employees, amazing and apparently two
hundred million of revenue.
Speaker 2 (23:10):
Well that that is magic when you have when you
have that kind of employee revenue employee ratio.
Speaker 1 (23:17):
Well, but it was like like WhatsApp, these were these
are businesses that didn't require a performance marketing drive train.
They were technologies that either caught on or didn't, and
they each caught on with think. I think What'sapp had
thirty five or forty employees when they sold the business.
Speaker 2 (23:33):
To Meta Yeah, exactly, so.
Speaker 1 (23:36):
What seventeen billion dollars, nineteen billion.
Speaker 2 (23:37):
Dollars or something crazy. Yeah, that's the dream. Of course,
is even nice small team.
Speaker 1 (23:42):
Listeners, if you have that option, do that?
Speaker 2 (23:44):
Do that? That one's the very that's the best one
of all.
Speaker 1 (23:48):
We're going to talk next about something you and I
have a lot of passion for is the greater economy.
And I got a text to our number, which I'll
remind the audience of at the end of the show
from Samantha and the Bahamas wrote, the creator economy is
estimated to be a one hundred billion dollar market soon,
but it is highly fragmented and seems to have power
law distribution to a few top creators. Do you think
(24:10):
this will be a real job category for millions of
people in the future, Well, I assure you, But Mariam,
I'd love to hear your there's so much experience in this.
Speaker 2 (24:18):
That's a really, really great question. There is a strange
pareto principle that I've observed in almost really on everything
I've touched from a consumer perspective, where twenty percent of
the products or twenty percent of the people generate eighty
percent of the revenue. And I keep seeing it. It's
(24:40):
a strange natural phenomenon. I don't if you should google
it on Wikipedia. It's it's really fascinating, but I've seen
it over and over and over again. In content businesses,
it can be even more extreme, or just a couple
of hits drive you know, ninety plus of the revenue,
So content can be very extreme creator economy. I do
(25:02):
think that there's one. I think AI is going to
actually shake things up a lot and could end up
upturning the apple cart, meaning that some people who might
have been not at the top of this pyramid could
end up at the top because they are better utilizing
tools that are now available to them. And I'm talking
about all sorts of creative disciplines. So that could cause
(25:26):
a lot of change, and it could cause rapid change,
such that one minute you're at the top, one minute
you're at the bottom, the next minute you're at the top,
but you might slide down again. And I think there
could be a little bit more dynamism and who is
quote unquote at the top of this pyramid, meaning that
it could change more rapidly. So that's I think in
that respect, it might give people a better shot and
(25:47):
maybe make things a bit fairer. I do think. I
do think that I do think there will be more
I think there will be more ways for creators to
reach people. I think. And then if you fly like
for example and minted, let me give you an example.
If you finally slice wedding imitations versus birth announce birth
(26:08):
announcements versus holiday cards, et cetera, you're going to find
a different group of people at the top of non
photo holiday cards, different group of artists who do non
photo heart holiday cards. The best versus holiday cards the
best with one photo versus multi photo. So there are
all these like fine slices of creation out there. Even
within something as simple and as innocent as a holiday card,
(26:30):
You've got lots and lots of different category subcategories, and
within each of those you have a different pyramid of people.
So when you talk about who's going to get the
outside returns, as long as we have a lot of
categories on offer for sale, you could have different people
being at the top of some very very micro specialty.
And I think that that's one way to think about it.
Speaker 1 (26:51):
And I say what I've seen with creators as well
is just as you noted with companies, there there are
different paths. There is the you know, there's only maybe
one mister beast on YouTube was going to spend a
million dollars on an episode, and you know I have
one hundred million subscribers, But there are countless people who
can make a living. And yes, I read the other
(27:11):
day two of the top five jobs desired by teenagers
today our creator economy. Jobs that did not exist twenty
years ago. Influencer, professional gamer, YouTuber or like the top
ten job. It would never have occurred to me when
I was a teenager that those are jobs because because
the Internet didn't exist, so people couldn't sit there and
(27:33):
watch me play video games. I would have thought it
was a pretty cool idea.
Speaker 2 (27:36):
Yes, I so much has changed in twenty five years
because back well even thirty years didn't even have the interview.
We didn't even have access to the Internet. So we
if you think about you know, where we started our careers, Mike,
we probably never thought we would be spending so much
time on this thing called the Internet and that our
careers would so much revolve around this. Right we didn't
(27:58):
even come out of college. So there's probably something for
college students right now that doesn't exist that will really
dominate their careers when we don't know what it is yet.
And I'm starting a new business that will launch in
January that is also a creator economy business called Arcade
(28:18):
dot ai that I haven't really shared with shared with
the public yet. It's in stealth mode. It's launching in
mid January. Let's just say that it's a it's a
place where I think it will that you will have
you will be able to invent new career. There will
be a new career invented and I think it's just
exactly what you're talking about, where we've tried to create
(28:40):
a new kind of job for creative people. So check
it out when it comes, because I think it's going
to be really well suited to certain certain kinds of
people with an unusual mix of skill sets that I
think that I think just creates another outlet for people
with creative vision.
Speaker 1 (28:57):
This is terrific Well to our audience, I'll either drop
a link in the show notes where you can find
out more, or when the company drops, I'll put it
in a link of the show notes in a future episode.
(29:17):
Angela in White Plains, New York sent me a DM
on LinkedIn and she asked, as innovators, how do you
come up with new ideas? What is your process for
finding the next big thing?
Speaker 2 (29:29):
Well, I think there are probably a few, like maybe
two to three buckets. Let's talk about them. One is
a bucket of sort of pattern fitting where I can
see this pattern over here, and I think I can
bring this pattern over here. And that's for example, my
first company, eve dot com, where I saw books being
sold online, music at this point physical CDs being sold online,
(29:53):
and my partner Varsha had an idea to sell cosmetics online,
and I wanted to work with her. I wanted to
she do market research funny enough online. She wanted to
do put cosmetics online, and I wanted to work with her.
So I said, you know, I'm going to I'm going
to just do your idea.
Speaker 1 (30:08):
Great, fine, we'll try yours and that we'll do mine. Yeah,
and you sell it for.
Speaker 2 (30:14):
I like cosmetics, I use cosmetics. Why not let's try it.
So we did our and by the way, we did
our Michael Porters five force's strategy analysis, and it looked
the outcome was really bad because one of the things
that asks is.
Speaker 1 (30:25):
You get the money's worth out of your MBA.
Speaker 2 (30:27):
I know, it's seriously we tried, but then of course
the conclusion was wrong. It said, this is bad because
there's so much concentration on the supply side, which is
a bad bad thing. In Michael Porter's framework, right, this
is because Cesta latter companies own more than fifty percent
of the cosmetics market, and that means you've got a
very consolidated supply side. We did it anyway, I was thinking,
(30:47):
oh my gosh, I'm not sure. Let's see what happens.
But it turned out that and this is just goes
to you. If you're at the surface level looking an idea,
you have to get your you almost have to have
a hand in the game and be at the table
to really actually develop the right idea. So you're circling
around an area, but get yourself into the game and
have a hand in the game, otherwise you won't. And
(31:10):
what I mean by that is we started Eve dot com,
we had a hand in the game. We realized that
when we opened the doors that we were a raging success.
And why because there were all these small brands popping
up at the time that could not pay for department
start distribution, but they were getting some coverage in magazines,
(31:32):
women's magazines, and so there was this like pent up
demand across the US for a brands like Mac and
Nars and Hard Candy and Urban Decay and Vincent Longo
and all these little tiny brands, and they could not
afford department start distribution, so you couldn't get them, and so.
Speaker 1 (31:48):
The stolars were more fragmented than exactly then one would
have thought. But you just like you did with just
like you did with holiday cards, or you took the
friction out of it. You took the friction out of
getting access to the longer tail suppliers.
Speaker 2 (32:00):
In yes, unknowingly, I'm just going to say that was
an accident. That was it was an accent. So you know,
we had the hand in the game. We realized what
was going on. I mean we we sort of accidentally
stumbled into it. But just taking a little bit of
risk and trying it ungated this massive business. So that
was a pattern fit business. The other kind that I
can think of right now is sort of the light bulb,
build it and they will come type of well and
(32:24):
I would say more more, hypoth more, and I would
say hypothesis driven. So the hypothesis behind Minted was that
Minted could that The hypothesis behind Minted was that there
were artists that were undiscovered all across the world, and
the Internet could find better artists that if you held
(32:48):
design competitions that there was there's got to be talent
that could not get to market. That's a hypothetical. And
the other hypothetical was that if people like to the
card and they would turn it over and look at
who made it, and you would have inherent virality of
your product. Those are the two hypothetic couples that drove
mint it. And that was so that was a different
(33:09):
kind of where does the idea come from? Was more
around that people were seeking better and better design in
the world that they were hit there was hidden design
talent and that this virality factor could drive the growth
of this business. And so it was all a bunch
of light hypotheses that drove Minted. It wasn't a pattern
(33:31):
fit type business. So that's a different kind of way
to source an idea. Is you think the world is
going a place, you think the world is going in
a direction, you have an idea as to where it's going,
and you try to build against that idea. That's so
to me, those are two kinds of ways to get
to get to a business idea.
Speaker 1 (33:47):
And I think what may keep a lot of people
out of entrepreneurship is this idea that you have to have.
You have to have the light bulb moment, completely new
creative idea. How many times have you heard somebody say, oh,
I thought of that, I wish I had patented it
like that. It's not actually a shortage of ideas, it's,
if anything, is shortage of willingness to try and hustle,
and I remember I was it's this wonderful organization. Michael Mimslansky,
(34:11):
who was on the podcast a couple of weeks ago,
introduced to me to he's on the board. It's called
pencil dot org and they have executives go be the
principle of a public school for a day and it
really just means you get to meet the kids and
tell them what it's like at your job, and it's
a ton of fun. And I was at a school
last year and the kids asked a question sort of
like this. They're like, well, you know, how do you
come up with the idea to say? Okay, guys, like
(34:32):
take a couple of minutes and then tell me like
a brand new idea that you have that you want
to start. And they were like, they didn't come up
with anything. I said, okay. Now I have a friend
who runs a declining magazine in the travel space and
they're trying to figure out what to do next. And
the problem they try to solve is people want to
go traveling and they, you know, and have new experiences.
(34:52):
What could you do if you were that company and
they had a hundred ideas, they just needed to have
like their attention focused on something there, like, oh, you
could have an app that does this when you're in
a town, and you could have a social feature and
it does this and this, and all the creativity started
to come out. But it wasn't you go from no
idea to all the ideas. It was I see a
consumer problem not being quite solved by the current technology
(35:15):
or the current business or the current owner in that space.
And I've got a better angle. And so for our
you know, whether our audiences aspiring entrepreneurs or just folks
showing up at work tomorrow who think that there are
no idea. You know, there are no great new ideas
that they're going to come up with. They're all there.
They're all there. The last one. I'm really looking forward
(35:35):
to hearing your answer to this. Jackson Detroit called in
an asked us you are both leaders in your creator economy.
I'd love to know what are some of your favorite
art or creator projects right now? How do you choose
what the acquire and how do you choose what to
acquire in your own personal life? So, Mary, you must
be a collector of wonderful objects. And yeah, I'm sitting
(35:55):
here surrounded by art where do you start?
Speaker 2 (35:59):
I which are really with personal connection to the piece
is always number one, whether you feel personally some sort
of emotion or some sort of feeling of the piece
provides it gives you. I love everything from really exceptional
you know, artisanal goods, you know where there's really beautiful
(36:23):
evidence of the hand evidence of hand crafted quality and
it's very handmade and very unique to pieces of art
that really inspire me. And I have to say the
past year and a half I've been spending collecting a
lot of generative art where coders that I've met, like
William Mappen, for example, have been able to with code
(36:47):
create things that look absolutely hand drawn. And on top
of that, it's generative, meaning that he will run a
line of code and the engine will produce according to
the parameters he's set, unexpected art that he doesn't know
what's going to happen.
Speaker 1 (37:04):
And it's that intersection of human creativity and machine machine
creativity or randomness that yes, crazy crazy these objects.
Speaker 2 (37:11):
And what's amazing is that if you're good enough of
an artist coder, you can actually have everything in a
series of five hundred look absolutely beautiful. But that requires
a huge level of talent, and so William Mappen. You know,
I bought a Strands of Solitude piece which is part
of his collect collection. I've been also really interested in
(37:31):
in video, in you know, dynamic art, because I really
enjoy the combination of the senses sound and visual. So
I've been really I've been really delving into that world
and really collecting a lot in that world recently.
Speaker 1 (37:47):
And Tonic Labs is a great place to do it. Really.
Speaker 2 (37:51):
Tonic is great. We only work there with you know,
top notch, you know, really like the most collectible artists. Yeah,
so I think, I, uh, what would you say, Mike,
What's what are you collecting right now?
Speaker 1 (38:06):
Well? I run artsy guys, So I'm buying. I'm buying
a ton of artists. It's just in Miami at the
art fairs. And I'm always on. I mean, I'm on
my app every day. And we have this really cool
thing where we have a widget for the iPhone and
our team curators of Great Taste, they pick one painting
a day, one one item and they put it in
the widget. I've bought. I've bought two paintings out of
this out of the widget this year, so you know,
(38:30):
it's art. But what I would say to folks more
broadly is the vast majority of creators, whether they are
artists or independent musicians or crafts people, designers, they are
they're struggling to make a living. They don't have an
employer who's paying their paycheck every two weeks, they don't
have health care that comes from their corporation. They are
(38:53):
somebody who's been called to the arts. They've been there's
somebody who's been called to create and bring that bring
joy to other people, and bring an artist like they
tell the truth to you through through their work. And
they might have to stop creating if they don't make
a living. And so what I always remind folks like,
when you buy a painting, it's not like you're buying
(39:14):
a watch, right If you buy it, you buy some
cool leather crafted thing on Etsy. It's different than just
buying a sweater at the store. You're supporting an artist,
you're a patron. And and I know a lot of
these people now personally, when they get that email that
says you just sold this object, like their life lights up.
(39:34):
They get they get to go back to the studio
and keep doing this for another month and so you know,
whatever you were, you know, whatever folks, folks tastes are.
I would just encourage everyone to have that mindset, which
is you're not You're not just acquiring something for yourself.
You're you're doing something nice for the world. And I'll
drop in the show notes. I sort of keep a
published list of the artists I like and artworks I like,
(39:55):
and everyone can check it out or there's always a
standing offer. If you DM me, you say I want
to buy art, I will. I will personally, I will
personally put a painting on your wall. You just tell
me your budget and what you like, and that's what
I'm doing. For nice Mariam. This has been such a pleasure.
I've always been, you know, so inspired by your journey
and you're You're a wonderful person to work with and
(40:16):
I think our I think our audience probably got a
lot out of this conversation today.
Speaker 2 (40:21):
Good what's been great to see you again and catch
up and I look forward to staying in touch.
Speaker 3 (40:31):
Well.
Speaker 1 (40:31):
Friends. Today we talked about the entrepreneurial journey scaling up
a business. We talked a lot about creators. In my opinion,
the most interesting thing happening in business right now is
not some new technology. It's the explosion of human creativity
that we've seen and the power of the Internet to
give those people a following and allow them to make
(40:53):
a living. As we all move up Maslow's hierarchy of
needs from food and shelter to love and self esteem
and self realization. The arts, whether it's visual arts, design, entertainment, beauty,
they're all going to play a bigger and bigger role
in our lives.
Speaker 3 (41:11):
You know.
Speaker 1 (41:11):
I read a study one time NASA found that ninety
eight percent of five year olds tested as creative geniuses
and ninety eight percent of adults did not. But what
is it that made us go from being creative five
year olds done creative adults. I think it's because we
stopped trying. I don't know, Maybe we're embarrassed to try,
Maybe we stop believing that we had it in us.
But I, for one, see creative genius in my colleagues,
(41:34):
my teammates, my friends all the time. So this week,
as you grind through your week, I just I want
to leave you with that thought that we're all creators
in one way or another. We're all creative people, and
I'm really excited to live in this this new economy,
this new world where creatives play such an important role.
We've got some amazing guests coming up in the next
few weeks. We've got a leader of one of the
(41:56):
top luxury marketplaces. We've got a serial entrepreneur, a bunch
of exciting topics we're going to cover. So make sure
you text or call in your questions at two one,
three four one nine oh five nine six, or always
sit me up on LinkedIn, slide into the DMS, or
respond to one of my posts about the show. I
love hearing from you. I want to thank Miriam and
of course Jen, Cara, Meg Jada, Matt and the whole
(42:17):
team at Blue Duck Media for pulling this all together.
Thank Dylan and Sasha Gay and Nathan and Christine at
iHeart and Ben and the team at William Morrison Dever
for all their support. Office Hours is a production of
Blue Duck Media and we are distributed by iHeartRadio. Have
a great week, everybody, make sure you stay on your
grind
Welcome office hours. We sit down with the chief executives
shaping the world and answer your most pressing questions about leadership, careers,
and life. I'm Mike Stive and today we have the
pleasure of chatting with my friend Mariam Nafisi. Mariam is
a serial entrepreneur and a perennial rockstar of the tech
startup world. She pioneered online cosmetics with her startup eve
(00:27):
dot Com in nineteen ninety eight, which sold for over
one hundred million dollars. Mariam later disrupted the cards and
stationary industry with Minted dot Com, one of the first
companies to unlock the power of crowdsourced designs from independent artists.
She now leads Heretic Ventures, a venture studio that is
launching new startups in the creator economy, including most recently
(00:48):
Tonic Labs of Marketplace for Generative Digital Art. Mariam sits
on the board of directors of Minted, Medium, Victoria's Secret
and Every Mother Counts. She is a trustee of William's
College and a member of the Advisory Council of Stanford's
Graduate School of Business, and she's the author of The
fast Track, The Insider's Guide to winning jobs and management, consulting, investment,
banking and securities trading. Marry him. I'm so glad you're here.
(01:12):
Welcome to the show.
Speaker 2 (01:16):
Thank you. It's wonderful to be here.
Speaker 1 (01:18):
So we first met when I was running the not
I was planning weddings and you were ad minted and
you were you all were selling wedding invitations. So we
were like we were destined to be friends. But it's
been a few years since You've been good.
Speaker 2 (01:30):
I have been I've really enjoyed really taking a break
from being a full time operator and CEO and being
able to sort of keep tabs on many many developments,
technology developments and trends happening and really spend a lot
of my time studying just really studying what's happening, studying
(01:50):
new technologies. And I have a nice, wonderful group of
colleagues at heritaic Ventures who I love working with.
Speaker 1 (01:57):
Awesome. Well, we got a bunch of questions on your
journey is as an entrepreneur and as an operator, how
you generate ideas for the next big thing, all of it.
So if it's all right, we'll jump into we'll jump
in with the audience wants to hear from you and me.
All right, so the first question is from Barry in Dallas, Texas.
Speaker 3 (02:14):
Hey all, I'm Barry calling from Dallas, Texas. I'm in
investment banking, but lately I've had an h to do
a little more. In Mariam, you wrote a book about
in consulting in banking jobs, then you turned entrepreneurship later.
I wanted to ask you how did you know that
that was the move for you and also when was
the right time to make the lead?
Speaker 2 (02:32):
Thank you very much.
Speaker 1 (02:34):
Do real entrepreneurs work in investment banking and consulting and
go to business school? Obviously? The answer today is yes, yeah.
Speaker 2 (02:41):
You can. You can because you could find somebody who's
actually not a good match with investment banking. In investment banking,
they might be a better match with entrepreneurship. And I
have found other people like this who left and actually
went to start things because they realized, you know, find
this is a great background. It helps you with the
language of your raising capital. Subsequently, I've raised I've raised
(03:04):
a lot of capital. I think my latest talent it's
almost close to four hundred million now for my different businesses,
which is pretty crazy. But you know, it's something that
grounds you and being able to have a language that
you can share with investors, which is not a bad background. Yes,
computer science these days is great, but finance isn't bad.
(03:26):
And being quantitative and metrics oriented isn't a bad way
to go either. Anyway, So I ended up going back
to business school, but really with this intention that I
would never enter you for a job coming out, and
I would fully focus on entrepreneurship and I would try
to make friends with people who could get me access
to capital, which at that point was a big concern
(03:46):
of mine. I thought, you know, honestly, as a woman
and as a minority woman, I was not sure that
I would be able to raise capital as easily. And
I thought that if I went to the Stanford I
would meet people who were in the venture capital space
who I could make connections that would help me raise
capital later. And that was one of the major reasons
(04:07):
that I decided to go. And then I started and
then I started starting businesses.
Speaker 1 (04:11):
And I have multiple friends who started their businesses in
or on the way out of business schools, so that's
not wildly uncommon. Yeah, yeah, And yet we have this
archetype of sort of every founder is a college dropout
and is nineteen and has nothing to lose. But you
had actually developed a real base of understanding of what
(04:31):
you were going to do as a leader and as
an entrepreneur.
Speaker 2 (04:35):
Yeah, that's right. I think that's right. At least I'd
seen some businesses how about that? And I started to
understand strategy, and then the business school gave me the
sort of a toolkit to understand what was out there
in terms of research frameworks to solve problems. I mean,
for example, how do you design compensation inside a company?
(04:55):
It's kind of tricky. Actually, we studied that, and there
were some people who really were very, very expert at that.
And at that time it was not the industry of
raising money was not as transparent. So being able to
sit in IRV gross Backs Entrepreneurship class and understand that
venture firms could at that day in age collude with
(05:16):
each other to negotiate with you, for example, that there
were things like that that could happen that you needed
to understand work your way around a term sheet. Those
were things I learned. I learned a lot a lot
about that at Stanford.
Speaker 1 (05:31):
It's funny you mentioned compensation. I had some young entrepreneurs
had come to me years ago and had just started
their business and told me some of their management insights,
including that they thought it was ridiculous that people got
paid different amounts of money for different jobs in the company,
so everyone would have the same compensation. And I was like, man,
I cannot wait to see you guys again in two hours.
(05:52):
I can't wait. Learning by doing is you guys are
could have a great time.
Speaker 2 (05:57):
Yeah.
Speaker 1 (05:58):
So you had you at eve dot com just it
was a pioneer in the online cosmetic space, and then
later Minted dot com, where you and I met that
One of the dms I got was from Keighley in
New York City who wanted to hear from you. Everything
seems to be moving to digital. People meet online, shop online.
(06:18):
Some people are even apparently dating their AI companions. You've
both made a business of physical goods from creators. Are
you surprised there's so much demand still for objects like paper,
invitations and paintings.
Speaker 2 (06:35):
I'm not particularly surprised, but I sometimes think, gosh, am
I am I? This is when I started Minted. I thought,
am I just starting a niche business that only I
am going to care about?
Speaker 3 (06:45):
You?
Speaker 2 (06:46):
Know, beautiful luxury cards that really express you know, your
express your your personal style and taste and design and
your and then send greetings and love from your family.
Am I the only one? Maybe it's a small group
of us, but that's okay, you know, we're going to
go after that group. I think that there are not everyone,
(07:09):
but there's a substantial I would say there's a substantial,
substantial majority of the country that has something physical in
their lives that they care about. Whether it's a car
or it's a you know, a beau, a beautiful set
of you know, ceramics, or a beautiful painting on the wall.
(07:30):
We are living in the physical world and there's probably
something in each person's life, a piece of jewelry that
they care about. That everyone. I think everyone probably if
they think about it, you know, there's something they care about.
And if you just look at consumer spending on what
we spend on, you know, one one would argue that
there are important physical objects for everyone in the US.
(07:53):
So I think I'm not terribly surprised for paper cards
in particular. I think for minted, you know, it's what's
happened is you send less mail, but the pieces of
mail that you do send are very have become much
more important because it's so rare to get a piece
of mail, and so your wedding invitation, you know, or
your annual holiday card, those things that are really meaningful.
(08:16):
There are a few things left that people want to
receive in the mail, and then they spend they spend
more on it and they yeah, they're more thoughtful about it.
Speaker 1 (08:24):
It feels to me as a recipient too, that I
get far more holiday cards than I used to, probably
thanks to you having reduced a lot of the friction
that used to that it used to entail, used to
have to hand address and all of this stuff, and
now you can do it very, very seamlessly through formed
Thank you.
Speaker 2 (08:43):
We've tried. Yeah, we want to. We want to. It's
fun to have to think of your friend receiving a
piece of mail from you, opening it up and getting
that surprise of the family photo, your family's photo, updating
people on what your kids look like now, how grown
up they are. I mean, it is fun to imagine
your friend's open that card. And so I think there
we want to keep the fun in it and take
(09:03):
the friction out of it absolutely like not make it
difficult for you to have that fun and that experience.
Speaker 1 (09:08):
Well, I also found, you know, at arts where we
sell we sell physical paintings, we had more growth and
painting sales and just and in straight traffic to the
website and the app in the year where we all
started working remotely right after COVID, so we all migrated
from the physical world to the cloud, and the demand
(09:31):
for physical objects in our experience just went up. Because
when you step out of the cloud and you step
out of zoom and you're back in your physical world,
you want it to you want it to be a
place that that gives you endorphins, a place that that
fills you with joy. Now I want to go back
(09:55):
to something you touched on in the introduction, and we
heard this from one of our our listeners, Lucy and
San Francisco had hit me up on LinkedIn and wanted
me to ask you, Mariam is a woman starting businesses
more oriented towards women, How hard was it to convince
predominantly male venture capital firms to support you.
Speaker 2 (10:17):
It is a little bit more difficult when you're dealing
with products that largely target a female audience. With Eve
dot com, which was the first cosmetics company online, which
I started in nineteen ninety eight and sold in two thousand,
just before the bubble burst. The you know, we were
so early at that point that shoes were not being
(10:39):
sold online, clothes were not being sold online yet. I remember,
you know, we had launched and the Zappos launched right after.
But people were saying to us, you know, cosmetics are
never going to sell online. And this is more maybe
a message to all the would be entrepreneurs out there
that you're going to get a lot of very people
who are very certain about their opinion. And you know,
(11:02):
I think part of entrepreneurship is persisting and believing that,
you know, believing that some of the rules can be broken.
But we were told that women will not shop online,
and that cosmetics would not shop, would not be sold.
And of course we know women are huge purchasing for
us now online. I think it's something like sixty to
seventy percent of everything purchased online is actually bought by women,
(11:25):
just like in the real physical world, and cosmetics we
all know sell very well online. So we had a
lot of doubters on that. Same with Stationary. Stationary people
also said, no one's going to buy paper products online,
same thing. Very very knowledgeable, very knowledgeable people, and it
was very discouraging to have a very knowledgeable person say
(11:46):
this is not going to work. Because somebody you really
respect says that to you. It's scary. It's really scary.
And you know, three hundred million dollars later, which is mint,
it's about three hundred million in sales. It's funny.
Speaker 1 (11:59):
I'm kind.
Speaker 2 (11:59):
I'm really glad I didn't I'm glad I didn't listen.
Same with the cosmetics thing, because we launched in nineteen
ninety nine, we raised in ninety eight, launched in ninety nine,
the beginning of really in the early days of e commerce.
We turned the side on and we thought we were
going to be selling replenishment products, like you know, skincare
(12:19):
that you already know that you like and then you
just replenish. Instead. All the color cosmetics like eyes shadows
and blushes and things that you really need to try on.
All of that's just started flying off the shelves the minute. Seriously,
the first hour we opened. Cosmetics, color cosmetics flying off
the shelves all over the country, predominantly to people who
(12:42):
lived in areas where there was lack of access to
the really hot new brands, and that just started selling
like crazy. So I don't know, I think your question
so really, I think what I would do in this
case is just say, you know, if your face seen
that challenge, you just have to keep talking to more
investors until you find the one who believes in the
(13:05):
idea and who relates to the product. And that's what
we did. We found investors. Eventually. It's a little tougher,
a little slower sometimes, but you eventually find And by
the way, at this point, things have changed so much
since ninety eight that I would say there are a
lot of male investors who have really tried to put
(13:25):
themselves in the shoes of the female consumer. And really
especially when the markets are very large, and they can
see that the market is very large, the tam that
you're addressing is really large that they can definitely come
around a lot faster than twenty five years ago. So
do not be discouraged. There is a path. There's an
investor out there waiting to believe in your idea if
(13:47):
it's a good idea, and then market is big enough.
I think there's an investor out there for you, And.
Speaker 1 (13:52):
I think This is why entrepreneurs so are so fun,
because it's so fun to work with because there are
people who've been told no, no, no, this won't work,
and they just persist it yeah, and found success. And
that's as you've encouraged the audience. That's what it takes
to be successful. Jordan and San Francisco asked us.
Speaker 4 (14:11):
You've both led businesses through the dot com crash, the
financial crisis in two thousand and eight and COVID, what
have you learned about surviving difficult markets?
Speaker 1 (14:22):
Mary Mint had got off to a slow start.
Speaker 2 (14:24):
I remember, Yes, Mint had had a tough beginning because
we started and then there was a recession. Then Leavin
Brothers failed immediately right after we raised, maybe two weeks
after we closed our round, the bank failed and we
were in a really bad recession. It was I mean,
(14:44):
I would say what I learned was that we had
to really focus on cash and runway and preserving cash,
preserving and runway, so there should be somebody if you're
if you yourself are not financial. I had a great
partner in Melissa Kim who just she's the kind of
person who can feel cash moving around intuitively, like she
can feel it going out the door. It was she's
(15:05):
very financially, very financially intuitively talented, so she was on
my side and she really helped me make sure that
we didn't run out of money and would basically nag
me to make sure that I cut costs and in
a good way, in a nice way. And so we
managed to hang on and get by on and build
(15:27):
this entire crazy e commerce business with a lot of
physical fulfillment needs and had to build a customization app
really on like two million dollars, you know, which was skimpy,
and so I had to be really creative. You know,
we hired. Everybody we hired was probably twenty two twenty three.
There were no there was there was no one we
could afford who was an experienced VP of something. So
(15:51):
it was it was a very young group of people.
But we had fun and I was steeped. I call
it being steeped in millennial bath because everybody I was
hiring was a millennial coming out of college at the time.
And you know what, that turned out to be a
huge win for us culturally, because you know, when we
for example, we sell our cards at Target now and
(16:14):
Target has told us, you know, you know you're the
millennial company. The millennial millennials love you, and I think
it's no wonder because the whole company, besides me, we're
all millennials, and every part of that culture and ethos
infused the company, and that was that's really a big win.
So sometimes like really positive things can come out of
those really difficult moments. But I would say the number
(16:36):
one is to act like you have half the cash
you do really cut if you're going to go through
a shake up like the pandemic, the sooner you address
the cost structure, the more optionality and that's a made
up word, but the more optionality you have, so days
and weeks count. We did a layoff within four weeks
(16:58):
of the pandemic, which was very fast, but we just
we just had much more wriggled room to save the
company and save everyone everyone else's jobs because we had
because we acted quickly.
Speaker 1 (17:10):
And it's such a hard thing to do. It's emotionally
so painful as a leader when you signed up to
take care of this team to have to to have
to tell people that they don't work at the company anymore. Yeah, really,
but they're at moments like this, it's it's that or
no one makes it, and so you have to make that.
You have to make that really difficult choice.
Speaker 2 (17:29):
Exactly. That's very exactly what what what I was thinking
is that I have to sacrifice some of the jobs
to save the rest, and that was difficult.
Speaker 1 (17:40):
I've also found I wonder if you have as well.
The teammates and employees who have been through a crisis
are just so much better at the job than those
who haven't. And we had we had a pretty big
gap between the financial crisis and COVID and and I
remember at the beginning there was this sense of like,
how is this bad thing happened? And when did the
(18:00):
bad things stop? And really I found our team and
as people came to the conclusion, they're like, bad things happen,
that's the job. It changed how everyone leaned into the
pain of these situations, and I think it made us
better professionals and better companies.
Speaker 2 (18:17):
I could not agree more.
Speaker 1 (18:19):
Alexa in Boston, I.
Speaker 4 (18:21):
Heard in an interview on Masters of Scale that you
raised more money than you needed a minted this year's
were notable for all the companies, so I found themselves
in valuation traps after raising it. Hyped valuations during the
recent venture boom. Do you staw have the same advice
for earlier stage companies?
Speaker 1 (18:37):
Mariam I, I recall I think I've read that you
had raised the most capital in a single year of
any female founder in America at one point. This may
be the reference that election that was.
Speaker 2 (18:46):
Later in our history. Once we had made it, meaning
once we had it, once we got past that recession
part where we only had two million. Yes, after that
we were we had a lot of offers to take
more capital, and we took a lot of capital. Some
of that, I'll be honest, was went out to shareholders
and secondary sales. Because we knew we were in it
(19:07):
for a long haul. We had to sometimes give liquidity
to employees and to investors, so some of that money
did A lot of that did not go into the company.
Speaker 1 (19:16):
Just to be clear, that's interesting because a lot of
people think, is an employee at an earlier stage company
or a privately held company, you will only see value
in your equity if you go public. But a lot
of companies do what you did, which is allow an
investor to buy up shares from folks who are already
who are already there, so that they get the benefit
of a lot of the hard work they've done.
Speaker 2 (19:36):
That's right, that's right. And I'm always thinking about liquidity
for the different shareholders like employees, investors, and I have
this preference to always if I'm going to do a secondary,
everybody across the entire cap table gets to participate. Employees
and investors, everybody, everybody gets to participate at the same
time because I want the I want employees to be
(19:58):
able to have some liquidity as we go towards a
very long term, long term outcome. So I would say
that I think, now, how do I feel? I think
it really depends on the industry you're in and how
competitive it is. So for example, if it's a very
competitive industry that's attracting a lot of capital moving very quickly,
(20:20):
I think it'd be best to accumulate funds quickly. And
that would be like the eve dot com situation where
we raised twenty six million in the first year of
business and we raised in I know this is going
to sound crazy, but I believe in fourteen months we
did four rounds.
Speaker 1 (20:37):
Wow.
Speaker 2 (20:37):
Yeah, and that was a that was a land grab moment.
So this is a moment where literally there this.
Speaker 1 (20:42):
One if you wanted to be online, you had to
build everything yourself. There was no Amazon Amazon hosting for
your website. You had machines on premise. You were building
your own content management system. Everything was everything home spun.
It was much more expensive.
Speaker 2 (20:56):
Everything was homegrown, exactly, custom code everything. And then on
top of that, it was a landgrad from a marketing perspective.
So we had television ads running. We had in our
first year, we had television ads running, we had print
ads running. We were such a big advertiser at condy
Nast that we were invited to the White House to
meet President Clinton. I mean it was it was absolutely
(21:18):
an insane experience. The whole thing is a twenty twenty eight,
twenty eight year old, twenty nine year old. But the
problem was that after we launched, we had four competitors,
all VC backed, launched in the market after us, all
of which had raised money. So that situation very competitive.
You're trying to build market share and awareness as quickly
as you can because really there a lot of benefits
(21:42):
in terms of awareness accrued to like a first mover,
and we were the first mover. We were the biggest
that that that's a different environment if you're dealing with
Minted where nobody nobody's really going into stationary There's not
much investment going on in e commerce at the time
in two thousand and eight. It's not fashionable to do
(22:03):
a direct to consumer company at that time. You have,
you can take it a little more slowly and you
can build up the capital. Also, I had different objectives.
Mint was meant to be a cash flow business, one
where you know, we we were trying to maximize cash flow.
I had a different lifestyle and personal objective in mind.
And entrepreneurs don't all have to be aiming towards like
(22:26):
a VC investment with a public company outcome. You know,
you could also be an entrepreneur who says I want
to build a lifestyle business with cash flow, you know,
and you could have you could build a different business
that has a lower revenue outcome, and it's really about
cash flow. And that's what Minted was actually originally supposed
to be. So then you could raise less money potentially
(22:47):
at this point in time. And also, by the way,
if you're willing to do all the VP jobs yourself
retain your ownership, you know, you're willing to do that,
and you're willing to hire twenty two twenty three year olds.
That's a different kind of HR approach and you need
less capital for that.
Speaker 1 (23:04):
So mid Journey has eleven employees, amazing and apparently two
hundred million of revenue.
Speaker 2 (23:10):
Well that that is magic when you have when you
have that kind of employee revenue employee ratio.
Speaker 1 (23:17):
Well, but it was like like WhatsApp, these were these
are businesses that didn't require a performance marketing drive train.
They were technologies that either caught on or didn't, and
they each caught on with think. I think What'sapp had
thirty five or forty employees when they sold the business.
Speaker 2 (23:33):
To Meta Yeah, exactly, so.
Speaker 1 (23:36):
What seventeen billion dollars, nineteen billion.
Speaker 2 (23:37):
Dollars or something crazy. Yeah, that's the dream. Of course,
is even nice small team.
Speaker 1 (23:42):
Listeners, if you have that option, do that?
Speaker 2 (23:44):
Do that? That one's the very that's the best one
of all.
Speaker 1 (23:48):
We're going to talk next about something you and I
have a lot of passion for is the greater economy.
And I got a text to our number, which I'll
remind the audience of at the end of the show
from Samantha and the Bahamas wrote, the creator economy is
estimated to be a one hundred billion dollar market soon,
but it is highly fragmented and seems to have power
law distribution to a few top creators. Do you think
(24:10):
this will be a real job category for millions of
people in the future, Well, I assure you, But Mariam,
I'd love to hear your there's so much experience in this.
Speaker 2 (24:18):
That's a really, really great question. There is a strange
pareto principle that I've observed in almost really on everything
I've touched from a consumer perspective, where twenty percent of
the products or twenty percent of the people generate eighty
percent of the revenue. And I keep seeing it. It's
(24:40):
a strange natural phenomenon. I don't if you should google
it on Wikipedia. It's it's really fascinating, but I've seen
it over and over and over again. In content businesses,
it can be even more extreme, or just a couple
of hits drive you know, ninety plus of the revenue,
So content can be very extreme creator economy. I do
(25:02):
think that there's one. I think AI is going to
actually shake things up a lot and could end up
upturning the apple cart, meaning that some people who might
have been not at the top of this pyramid could
end up at the top because they are better utilizing
tools that are now available to them. And I'm talking
about all sorts of creative disciplines. So that could cause
(25:26):
a lot of change, and it could cause rapid change,
such that one minute you're at the top, one minute
you're at the bottom, the next minute you're at the top,
but you might slide down again. And I think there
could be a little bit more dynamism and who is
quote unquote at the top of this pyramid, meaning that
it could change more rapidly. So that's I think in
that respect, it might give people a better shot and
(25:47):
maybe make things a bit fairer. I do think. I
do think that I do think there will be more
I think there will be more ways for creators to
reach people. I think. And then if you fly like
for example and minted, let me give you an example.
If you finally slice wedding imitations versus birth announce birth
(26:08):
announcements versus holiday cards, et cetera, you're going to find
a different group of people at the top of non
photo holiday cards, different group of artists who do non
photo heart holiday cards. The best versus holiday cards the
best with one photo versus multi photo. So there are
all these like fine slices of creation out there. Even
within something as simple and as innocent as a holiday card,
(26:30):
You've got lots and lots of different category subcategories, and
within each of those you have a different pyramid of people.
So when you talk about who's going to get the
outside returns, as long as we have a lot of
categories on offer for sale, you could have different people
being at the top of some very very micro specialty.
And I think that that's one way to think about it.
Speaker 1 (26:51):
And I say what I've seen with creators as well
is just as you noted with companies, there there are
different paths. There is the you know, there's only maybe
one mister beast on YouTube was going to spend a
million dollars on an episode, and you know I have
one hundred million subscribers, But there are countless people who
can make a living. And yes, I read the other
(27:11):
day two of the top five jobs desired by teenagers
today our creator economy. Jobs that did not exist twenty
years ago. Influencer, professional gamer, YouTuber or like the top
ten job. It would never have occurred to me when
I was a teenager that those are jobs because because
the Internet didn't exist, so people couldn't sit there and
(27:33):
watch me play video games. I would have thought it
was a pretty cool idea.
Speaker 2 (27:36):
Yes, I so much has changed in twenty five years
because back well even thirty years didn't even have the interview.
We didn't even have access to the Internet. So we
if you think about you know, where we started our careers, Mike,
we probably never thought we would be spending so much
time on this thing called the Internet and that our
careers would so much revolve around this. Right we didn't
(27:58):
even come out of college. So there's probably something for
college students right now that doesn't exist that will really
dominate their careers when we don't know what it is yet.
And I'm starting a new business that will launch in
January that is also a creator economy business called Arcade
(28:18):
dot ai that I haven't really shared with shared with
the public yet. It's in stealth mode. It's launching in
mid January. Let's just say that it's a it's a
place where I think it will that you will have
you will be able to invent new career. There will
be a new career invented and I think it's just
exactly what you're talking about, where we've tried to create
(28:40):
a new kind of job for creative people. So check
it out when it comes, because I think it's going
to be really well suited to certain certain kinds of
people with an unusual mix of skill sets that I
think that I think just creates another outlet for people
with creative vision.
Speaker 1 (28:57):
This is terrific Well to our audience, I'll either drop
a link in the show notes where you can find
out more, or when the company drops, I'll put it
in a link of the show notes in a future episode.
(29:17):
Angela in White Plains, New York sent me a DM
on LinkedIn and she asked, as innovators, how do you
come up with new ideas? What is your process for
finding the next big thing?
Speaker 2 (29:29):
Well, I think there are probably a few, like maybe
two to three buckets. Let's talk about them. One is
a bucket of sort of pattern fitting where I can
see this pattern over here, and I think I can
bring this pattern over here. And that's for example, my
first company, eve dot com, where I saw books being
sold online, music at this point physical CDs being sold online,
(29:53):
and my partner Varsha had an idea to sell cosmetics online,
and I wanted to work with her. I wanted to
she do market research funny enough online. She wanted to
do put cosmetics online, and I wanted to work with her.
So I said, you know, I'm going to I'm going
to just do your idea.
Speaker 1 (30:08):
Great, fine, we'll try yours and that we'll do mine. Yeah,
and you sell it for.
Speaker 2 (30:14):
I like cosmetics, I use cosmetics. Why not let's try it.
So we did our and by the way, we did
our Michael Porters five force's strategy analysis, and it looked
the outcome was really bad because one of the things
that asks is.
Speaker 1 (30:25):
You get the money's worth out of your MBA.
Speaker 2 (30:27):
I know, it's seriously we tried, but then of course
the conclusion was wrong. It said, this is bad because
there's so much concentration on the supply side, which is
a bad bad thing. In Michael Porter's framework, right, this
is because Cesta latter companies own more than fifty percent
of the cosmetics market, and that means you've got a
very consolidated supply side. We did it anyway, I was thinking,
(30:47):
oh my gosh, I'm not sure. Let's see what happens.
But it turned out that and this is just goes
to you. If you're at the surface level looking an idea,
you have to get your you almost have to have
a hand in the game and be at the table
to really actually develop the right idea. So you're circling
around an area, but get yourself into the game and
have a hand in the game, otherwise you won't. And
(31:10):
what I mean by that is we started Eve dot com,
we had a hand in the game. We realized that
when we opened the doors that we were a raging success.
And why because there were all these small brands popping
up at the time that could not pay for department
start distribution, but they were getting some coverage in magazines,
(31:32):
women's magazines, and so there was this like pent up
demand across the US for a brands like Mac and
Nars and Hard Candy and Urban Decay and Vincent Longo
and all these little tiny brands, and they could not
afford department start distribution, so you couldn't get them, and so.
Speaker 1 (31:48):
The stolars were more fragmented than exactly then one would
have thought. But you just like you did with just
like you did with holiday cards, or you took the
friction out of it. You took the friction out of
getting access to the longer tail suppliers.
Speaker 2 (32:00):
In yes, unknowingly, I'm just going to say that was
an accident. That was it was an accent. So you know,
we had the hand in the game. We realized what
was going on. I mean we we sort of accidentally
stumbled into it. But just taking a little bit of
risk and trying it ungated this massive business. So that
was a pattern fit business. The other kind that I
can think of right now is sort of the light bulb,
build it and they will come type of well and
(32:24):
I would say more more, hypoth more, and I would
say hypothesis driven. So the hypothesis behind Minted was that
Minted could that The hypothesis behind Minted was that there
were artists that were undiscovered all across the world, and
the Internet could find better artists that if you held
(32:48):
design competitions that there was there's got to be talent
that could not get to market. That's a hypothetical. And
the other hypothetical was that if people like to the
card and they would turn it over and look at
who made it, and you would have inherent virality of
your product. Those are the two hypothetic couples that drove
mint it. And that was so that was a different
(33:09):
kind of where does the idea come from? Was more
around that people were seeking better and better design in
the world that they were hit there was hidden design
talent and that this virality factor could drive the growth
of this business. And so it was all a bunch
of light hypotheses that drove Minted. It wasn't a pattern
(33:31):
fit type business. So that's a different kind of way
to source an idea. Is you think the world is
going a place, you think the world is going in
a direction, you have an idea as to where it's going,
and you try to build against that idea. That's so
to me, those are two kinds of ways to get
to get to a business idea.
Speaker 1 (33:47):
And I think what may keep a lot of people
out of entrepreneurship is this idea that you have to have.
You have to have the light bulb moment, completely new
creative idea. How many times have you heard somebody say, oh,
I thought of that, I wish I had patented it
like that. It's not actually a shortage of ideas, it's,
if anything, is shortage of willingness to try and hustle,
and I remember I was it's this wonderful organization. Michael Mimslansky,
(34:11):
who was on the podcast a couple of weeks ago,
introduced to me to he's on the board. It's called
pencil dot org and they have executives go be the
principle of a public school for a day and it
really just means you get to meet the kids and
tell them what it's like at your job, and it's
a ton of fun. And I was at a school
last year and the kids asked a question sort of
like this. They're like, well, you know, how do you
come up with the idea to say? Okay, guys, like
(34:32):
take a couple of minutes and then tell me like
a brand new idea that you have that you want
to start. And they were like, they didn't come up
with anything. I said, okay. Now I have a friend
who runs a declining magazine in the travel space and
they're trying to figure out what to do next. And
the problem they try to solve is people want to
go traveling and they, you know, and have new experiences.
(34:52):
What could you do if you were that company and
they had a hundred ideas, they just needed to have
like their attention focused on something there, like, oh, you
could have an app that does this when you're in
a town, and you could have a social feature and
it does this and this, and all the creativity started
to come out. But it wasn't you go from no
idea to all the ideas. It was I see a
consumer problem not being quite solved by the current technology
(35:15):
or the current business or the current owner in that space.
And I've got a better angle. And so for our
you know, whether our audiences aspiring entrepreneurs or just folks
showing up at work tomorrow who think that there are
no idea. You know, there are no great new ideas
that they're going to come up with. They're all there.
They're all there. The last one. I'm really looking forward
(35:35):
to hearing your answer to this. Jackson Detroit called in
an asked us you are both leaders in your creator economy.
I'd love to know what are some of your favorite
art or creator projects right now? How do you choose
what the acquire and how do you choose what to
acquire in your own personal life? So, Mary, you must
be a collector of wonderful objects. And yeah, I'm sitting
(35:55):
here surrounded by art where do you start?
Speaker 2 (35:59):
I which are really with personal connection to the piece
is always number one, whether you feel personally some sort
of emotion or some sort of feeling of the piece
provides it gives you. I love everything from really exceptional
you know, artisanal goods, you know where there's really beautiful
(36:23):
evidence of the hand evidence of hand crafted quality and
it's very handmade and very unique to pieces of art
that really inspire me. And I have to say the
past year and a half I've been spending collecting a
lot of generative art where coders that I've met, like
William Mappen, for example, have been able to with code
(36:47):
create things that look absolutely hand drawn. And on top
of that, it's generative, meaning that he will run a
line of code and the engine will produce according to
the parameters he's set, unexpected art that he doesn't know
what's going to happen.
Speaker 1 (37:04):
And it's that intersection of human creativity and machine machine
creativity or randomness that yes, crazy crazy these objects.
Speaker 2 (37:11):
And what's amazing is that if you're good enough of
an artist coder, you can actually have everything in a
series of five hundred look absolutely beautiful. But that requires
a huge level of talent, and so William Mappen. You know,
I bought a Strands of Solitude piece which is part
of his collect collection. I've been also really interested in
(37:31):
in video, in you know, dynamic art, because I really
enjoy the combination of the senses sound and visual. So
I've been really I've been really delving into that world
and really collecting a lot in that world recently.
Speaker 1 (37:47):
And Tonic Labs is a great place to do it. Really.
Speaker 2 (37:51):
Tonic is great. We only work there with you know,
top notch, you know, really like the most collectible artists. Yeah,
so I think, I, uh, what would you say, Mike,
What's what are you collecting right now?
Speaker 1 (38:06):
Well? I run artsy guys, So I'm buying. I'm buying
a ton of artists. It's just in Miami at the
art fairs. And I'm always on. I mean, I'm on
my app every day. And we have this really cool
thing where we have a widget for the iPhone and
our team curators of Great Taste, they pick one painting
a day, one one item and they put it in
the widget. I've bought. I've bought two paintings out of
this out of the widget this year, so you know,
(38:30):
it's art. But what I would say to folks more
broadly is the vast majority of creators, whether they are
artists or independent musicians or crafts people, designers, they are
they're struggling to make a living. They don't have an
employer who's paying their paycheck every two weeks, they don't
have health care that comes from their corporation. They are
(38:53):
somebody who's been called to the arts. They've been there's
somebody who's been called to create and bring that bring
joy to other people, and bring an artist like they
tell the truth to you through through their work. And
they might have to stop creating if they don't make
a living. And so what I always remind folks like,
when you buy a painting, it's not like you're buying
(39:14):
a watch, right If you buy it, you buy some
cool leather crafted thing on Etsy. It's different than just
buying a sweater at the store. You're supporting an artist,
you're a patron. And and I know a lot of
these people now personally, when they get that email that
says you just sold this object, like their life lights up.
(39:34):
They get they get to go back to the studio
and keep doing this for another month and so you know,
whatever you were, you know, whatever folks, folks tastes are.
I would just encourage everyone to have that mindset, which
is you're not You're not just acquiring something for yourself.
You're you're doing something nice for the world. And I'll
drop in the show notes. I sort of keep a
published list of the artists I like and artworks I like,
(39:55):
and everyone can check it out or there's always a
standing offer. If you DM me, you say I want
to buy art, I will. I will personally, I will
personally put a painting on your wall. You just tell
me your budget and what you like, and that's what
I'm doing. For nice Mariam. This has been such a pleasure.
I've always been, you know, so inspired by your journey
and you're You're a wonderful person to work with and
(40:16):
I think our I think our audience probably got a
lot out of this conversation today.
Speaker 2 (40:21):
Good what's been great to see you again and catch
up and I look forward to staying in touch.
Speaker 3 (40:31):
Well.
Speaker 1 (40:31):
Friends. Today we talked about the entrepreneurial journey scaling up
a business. We talked a lot about creators. In my opinion,
the most interesting thing happening in business right now is
not some new technology. It's the explosion of human creativity
that we've seen and the power of the Internet to
give those people a following and allow them to make
(40:53):
a living. As we all move up Maslow's hierarchy of
needs from food and shelter to love and self esteem
and self realization. The arts, whether it's visual arts, design, entertainment, beauty,
they're all going to play a bigger and bigger role
in our lives.
Speaker 3 (41:11):
You know.
Speaker 1 (41:11):
I read a study one time NASA found that ninety
eight percent of five year olds tested as creative geniuses
and ninety eight percent of adults did not. But what
is it that made us go from being creative five
year olds done creative adults. I think it's because we
stopped trying. I don't know, Maybe we're embarrassed to try,
Maybe we stop believing that we had it in us.
But I, for one, see creative genius in my colleagues,
(41:34):
my teammates, my friends all the time. So this week,
as you grind through your week, I just I want
to leave you with that thought that we're all creators
in one way or another. We're all creative people, and
I'm really excited to live in this this new economy,
this new world where creatives play such an important role.
We've got some amazing guests coming up in the next
few weeks. We've got a leader of one of the
(41:56):
top luxury marketplaces. We've got a serial entrepreneur, a bunch
of exciting topics we're going to cover. So make sure
you text or call in your questions at two one,
three four one nine oh five nine six, or always
sit me up on LinkedIn, slide into the DMS, or
respond to one of my posts about the show. I
love hearing from you. I want to thank Miriam and
of course Jen, Cara, Meg Jada, Matt and the whole
(42:17):
team at Blue Duck Media for pulling this all together.
Thank Dylan and Sasha Gay and Nathan and Christine at
iHeart and Ben and the team at William Morrison Dever
for all their support. Office Hours is a production of
Blue Duck Media and we are distributed by iHeartRadio. Have
a great week, everybody, make sure you stay on your
grind
Host
Mike Steib
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