Invest Like the Best with Patrick O'Shaughnessy
· Tom Digan
[00:00:00] S2: And what's exciting is just on the investor landscape in general is that there's not much innovation being funded in fitness right now. When we first started trying to tell the story and raise money to institutional investors, it was like, how could you possibly compete with Peloton? They're a $50 billion company in that moment. You should build AI weights. That's what I remember. Multiple times. I was like, that seems like a bad idea. Where's the hardware? And then Peloton has their post-COVID troubles. And they're like, oh, well, Peloton didn't make it or that story got very hard. How can you build a good business? It can't be done. So it's been used against us twice now. But all that while, we've been iterating on product and shipping product to every other day and listening to our customer and building something that our members are telling us is really, really valuable. And so we have this amazing head start where we feel like we just don't really have any competition. So that's been really exciting. It was hard for a moment. Now we find ourselves in a position where when you get to this growth stage, people can see the numbers. You can look at App Store metrics and see that our business is inflecting and see that the growth rate has been really strong. And so there's a lot of investor interest. What's unique about conversation with investors now is we're in a strong position in that because of the general catalyst deal, we control the timeline on raising money. Our business now generates cash. It sustains itself. That doesn't mean we don't have huge ambitions. We do, as Greg just talked about, like we want to be the system of record in health and fitness. That's going to require raising additional capital, at least another round, and continue to invest in particularly product and engineering. Fortunately, we have some great investors already around the table right now. And the way we've been approaching it is start to go and spend time with a small group of really high-quality investors to get to know them outside of the context of a fundraising round, which is not something that we were used to. Now you have time to actually build rapport and get to know people when you're not raising money.
· Greg Stewart, Patrick O'Shaughnessy
[00:00:00] S1: What I think is important there, four or five years ago, it was, it's cash. We just need cash. I don't care who it comes from. Terms, sure, sounds great. We need money. We're dying. There was no selectivity. And this GC deal has given us a lot of leverage where we have more money in the bank than we did when we closed our Series B a year ago. And it's giving us time to really think about who are the people that we want in the boardroom? Who are the people that we want advice from in talking to companies in their portfolio? And just even before we're thinking about it, just knowing who are the five human beings, forget firms, because that's less important to me. Who are the people that we're really excited with for the next leg of Ladder? And we now have some cushion to go be smart. That was not possible. [00:00:00] S0: This remarkable journey is completely crazy. I know it's hopefully chapter one or two, and there's a long story to still be written. What is the kindest thing anyone's ever done for you? And you can take that either personally or professionally, however you want to take it.
· Patrick O'Shaughnessy, Greg Stewart
[00:00:00] S0: This remarkable journey is completely crazy. I know it's hopefully chapter one or two, and there's a long story to still be written. What is the kindest thing anyone's ever done for you? And you can take that either personally or professionally, however you want to take it. [00:00:00] S1: It has to be my wife through all of this. She married an investment banker in New York and San Francisco. And that has a path and a vision for life that you can predict and study today. And then I turned into this entrepreneur who's making no money. And we have three children. Like, she is also working very hard, but she has given me the room to make this possible. And if that dynamic wasn't true, there's just no way that I could do this. There would be no path. It's a huge burden that she took on, and it's a huge component of how we got here.
· Tom Digan
[00:00:00] S2: Greg just went with the wife, so I can't do that, even though that would be the obvious. You've got to thank my wife, who had been putting up with me since we were 19. What I'd say is, I would thank my dad, actually. When I try and describe to my kids what it is I do or what my role is, I always say that I sell. That's what I do. And when I think about that, the quote that always got me excited was what Ken Griffin would say, where I don't even think it was his line, but if we're all going to eat, someone's got to sell. And that always pumped me up that selling was important. And it wasn't always something that was transactional, but I learned sales watching my dad. It's not something he told me. It was something that just being with him. So we commuted to school for years, two different private schools, or it was like an hour commute and could be longer with traffic. And this is early 90s, mid 90s. You got those old Zach Morris cell phones. And my dad was a mortgage originator. So he was always on the phone and he was basically a traveling salesman, but on the phone in the car the entire time. He's a lefty. So he would have his phone on his shoulder and he would have his notebook on his left hand, taking notes and the map, and he'd be driving with his knees. And my brother and I would be listening to my dad selling basically every day. The three things that he taught me about sales are one, to be effective in sales, you need people to like you. Ideally, they want to root for you. And if you're really good, you can get them to potentially quit what they're doing and want to join you. That would be like the best thing. But then second thing is they need to trust you because that's kind of all you have. Integrity is everything when it comes to sales. And the third thing is you need to be relentless, but not in an annoying way, just deeply persistent. That's just carried me well through two very different careers to date. And he's just been an awesome role model and someone I think about trying to teach my own kids lessons like that.
· Patrick O'Shaughnessy, Greg Stewart, Tom Digan
[00:00:00] S0: Amazing place to end. You are one of the best salespeople I've ever met. The car rides works. [00:00:00] S1: It was effective getting me into Ladder. [00:00:00] S0: Yeah. Thank you so much, guys. [00:00:00] S2: Thank you. [00:00:00] S0: Thank you so much for joining us.