Angel Invest Boston is sponsored by Peter Fasse, top life science patent attorney.
Bettina Hein is the founder of Pixability, one of the fastest-growing companies in Massachusetts. She was also co-founder of SVOX, a profitable Swiss startup sold to Nuance Communications for $125MM. This record may make her success seem easier to achieve than it was. Bettina Hein overcame numerous obstacles to justify the sobriquet “Fearless Founder”. Learn from her as I did. She is an exemplar of resilience, grace under fire and plain common sense. She also has much to teach us about how a startup might best raise money. Whenever I ask angel investors about a remarkable pivot by a founder, there’s a good chance Bettina’s name will come up. Don’t miss this charming and instructive conversation with a star founder.
Click here to read the full episode transcript
Here are topics and quotes from the interview:
How Bettina Hein Found Her Entrepreneurial Path in Life
Bettina Hein Used to Write Computer Programs in Fourth Grade but Did Not Learn to Code in College; Why?
Professors Discouraged Bettina Hein from Pursuing a Career in the Sciences
“If I had to go back, I would probably get an undergraduate degree in either electrical engineering or computer science.”
“I think I wanted to be an entrepreneur very early on. There's just that example that was set in my family. There's no one in my family that has had a nine to five job ever, except my brother…”
Bettina Hein Founds an Entrepreneurship Initiative for Students at her University Called Start, that Leads her to Brains-to-Venture, Which Connects Her with Her co-founders in SVOX
SVOX Has a $125 MM Exit to Nuance Communications
Bettina Hein Starts Pixability – Looked for Co-founders But Could Not Find Any Willing Takers – How She made Being a Solo Founder Work
Pixability’s Storied Pivots
“We help large brands and their agencies place their video advertising and optimize it on YouTube, and we've expanded to Facebook, Instagram, and Twitter.”
How Pixability’s Platform Impacts the Viewing Public
“Consumers like it better, and brands get more out of it.”
Sal Daher Reads an iTunes Review from HealthTech617 – Asks You to Leave a Review on iTunes
Bettina Hein’s Advice on Fundraising for a Startup
Bettina Hein on How Things Change Once a Startup Gets Venture Funding
Bettina Hein Thinks Founders Are Scared of Having a Board So They Miss out on a Lot
“Many beginning entrepreneurs are scared of having a board. They fear the meddling in their business. They fear that people will force decisions on them, on the board. I have not seen that ever happen.”
“For me, often times the exercise of preparing for a board meeting is almost more important than the board meeting itself because it allows me to really think through the narrative of the company.”
Bettina Hein’s Way of Balancing Work & Family
Bettina Hein on Fundraising While Pregnant
Bettina Hein on Marketing Technology’s Crowded Landscape
Transcript of, "Fearless Founder”
Guest: Bettina Hein, Founder of Pixability
Sal Daher: This podcast is brought to you by Peter Fasse, patent attorney at Fish & Richardson.
Bettina Hein has founded three startups. At the time of this interview, she was heading up Pixability. It is really an excellent interview in which she discusses being a solo founder, being a woman founder with a family and many other topics of interest including funding and including the value of boards. She’s an incredibly versatile and capable founder who is just a delight to listen to. I hope you enjoy the relaunch of this podcast.
Sal Daher: Welcome to Angel Invest Boston, conversations with Boston's most interesting angels and founders. I'm Sal Daher and my goal for this podcast is to learn more about building successful new companies. The best way I can think of doing this is by talking to people who have done it. People such as my guest today, repeat founder Bettina Hein. Bettina, I'm really excited you agreed to do this.
Bettina Hein: Thank you so much for having me, Sal.
Sal Daher: Oh, this is tremendous.
Bettina Hein: And thank you for being an angel investor in Pixability.
Sal Daher: Oh, wow. Thank you for the opportunity. That's tremendous. So, unusually we're not recording in the studio. Listeners should know that we're recording in the office, in the very spartan and functional office, of Bettina Hein. We're not in the regular studio today.
Bettina Hein Bio
Bettina Hein is the founder and CEO of Pixability, considered the fastest growing company in Massachusetts. Pixability offers brands a software platform that helps them place videos in front of the right audience -- that's its business today. When it was founded in January of 2008, it was pursuing an entirely different market. It is due to the remarkable leadership of Bettina Hein that Pixability eventually zeroed in on the right business. Listeners to this podcast will remember her name coming up in prior interviews, including those of Michael Mark and Christopher Mirabile -- among others, really. I think it's come up more than that, as the exemplar of the founding CEO, we look forward to hearing her version of the amazing story of Pixability. Bettina was also a co-founder of SVOX, a Swiss speech technology company whose products are on Android phones and high-end automobiles.
Bettina Hein grew up in Germany with occasional stints in the US. She comes from a family with a tradition of entrepreneurship. She studied law and business accounting in Switzerland, and was a Sloan Fellow at MIT's Sloan School.
How Bettina Hein Found Her Entrepreneurial Path in Life
Bettina, as a service to our younger listeners, we like to start by talking about how our phenomenally successful guests found their path in life. I understand you were inspired by your grandfather's ability to do mental math -- please tell us how that put you on the path of learnings and discovery.
Bettina Hein: All of my four grandparents were entrepreneurs in their own rights. They did a number of things. They weren't big time entrepreneurs -- no Mark Zuckerbergs in the family -- but my grandmother had a corner grocery store. Another grandmother had a pharmacy together with my grandfather, and then my other grandfather, who I did the mental math with, was a coal miner and tried a number of different businesses, but eventually built a relatively sizable coal wholesaling company where he sold coal to large energy producers, electricity plants. He was the one that I partially grew up in his and my grandmother's house. He would do homework with me and he would always talk to me about how to construct things in the mind. What was fascinating about that was that you had to do a lot of math to construct these things correctly in order to not get killed because-
Sal Daher: Yes. Life and death.
Bettina Hein: Right? So, he would practice this math with me, and I still do that to this day. If I can't sleep, I will just do math problems in my head or try to calculate business plans, and think about how things work mathematically. That is something that I guess I've inherited from him, or maybe practiced with him. He could do long division in his head, too -- lots of decimals, like five or six decimals behind the point. It was really fascinating to see that, and I am far from able to do that. But one of the things that was important about that was that he taught me business skills in the context of that. The first one was you have to be able to do your math. Business is about making a profit in the end, and learning how to figure how you can make that come about.
The other one was that you always have to be ahead of the people that you're dealing with. If you're sitting across from someone at the negotiating table and you are quicker than they are about figuring out your business equation and the math behind it you're a step ahead, and that will give you a leg up. That was a really important lesson for me, that even if I'm not as quick as he was with the math, I, for years, ... now we have cellphones, but for years I would have a mini, little calculator always in my blazer pocket just to really do the quick math if people were asking me certain things, so that I could on the fly make decisions.
Bettina Hein Used to Write Computer Programs in Fourth Grade but Did Not Learn to Code in College; Why?
Sal Daher: That is tremendous. I've heard you used to code in Logo in the fourth grade and loved it, yet you studied business and law at university. In retrospect, would you have studied something different?
Bettina Hein: That is true. I did learn, as my first programming language, I learned Logo in fourth grade on an Apple IIe. That was a lot of fun. I also had a TRS-80, my first computer, which all of this dates me for your younger listeners. And then I learned some BASIC in high school, and I learned some Visual Basic. The thing is I went to middle school and high school in Germany, and girls, or young women, didn't really go into technical careers or subjects at university at that time. Even though I did really well in high school, I did not have the confidence to pursue a technical career. I had thought about becoming a chemist because both of my parents are pharmacists and I was really discouraged from that actively by the professors that I visited at some universities, which was a pity because when I did get to university I studied business -- the hardest, most analytical thing I could think of that I had the confidence to do was to study finance and accounting.
Sal Daher: So, they actually discouraged you?
Professors Discouraged Bettina Hein from Pursuing a Career in the Sciences
“If I had to go back, I would probably get an undergraduate degree in either electrical engineering or computer science.”
Bettina Hein: Yeah. "It takes ten years to get a doctorate in chemistry, by that time you'll want to have kids, so it's really not worth it." Those were the words, exact words that I got to hear there. So, when I came to university, I very quickly discovered that what others had relayed to me as really hard I did not find that difficult. What then happened was I was looking for something that I thought would be more analytical and I'd always thought that law might be also a good career, and so the law classes we had to take in business school I found really interesting and very systematic, so I thought, "Well, in parallel to my business studies, I'll study law." If I had to go back, I would probably get an undergraduate degree in either electrical engineering or computer science.
I wanted to do that at a later step in life, and that's why I became a Sloan Fellow at MIT. There were no master's programs in computer science that would accept me with my undergraduate degree, so I looked far and wide for those, but I did find the Sloan Fellows program with a Master's of Science in Management of Technology that allowed me to take classes at MIT. I learned three programming languages in my year at MIT in my early thirties because I really wanted to get into that more, and I've never worked as a programmer, but I can read code and I learned a lot through that and obviously my daily practice of managing a software company.
Sal Daher: That's tremendous. When did it become clear to you that you were meant to be an entrepreneur?
“I think I wanted to be an entrepreneur very early on. There's just that example that was set in my family. There's no one in my family that has had a nine to five job ever, except my brother…”
Bettina Hein: I think I wanted to be an entrepreneur very early on. There's just that example that was set in my family. There's no one in my family that has had a nine to five job ever, except my brother, but of people that are older than I am in our family, no one. So, I didn't really have that-
Sal Daher: That model.
Bettina Hein: That model in the family to do that. I did think that I might become a professional like a lawyer or something of that sort, I didn't think about software entrepreneurship.
Sal Daher: Lawyers have a little bit of an entrepreneurship on their own, if they're running their own practice. A lawyer or a doctor in the old days, now doctors are almost always employees. It's hard to have individual practices, but in former times you could have your own business.
In an earlier episode of this podcast, Professor Ed Roberts of the Sloan School, a pioneering scholar of tech entrepreneurship, mentioned that his studies indicate four founders as the number most highly associated with success in a startup. You were one of four co-founders at SVOX, so how did that team come about?
Bettina Hein Founds an Entrepreneurship Initiative for Students at her University Called Start, that Leads her to Brains-to-Venture, Which Connects Her with Her co-founders in SVOX
Bettina Hein: When I was at university in Switzerland in St. Gallen, I started ... and this is almost exactly 20 years ago, I started a student initiative for entrepreneurship called Start, and some of my colleagues there that started that initiative with me went on to start something called Brains-To-Ventures, which was kind of a founder dating platform. They said, "Look, Bettina, you've got to walk the talk. You have to sign up for this," and I did not, again, have the confidence to immediately become an entrepreneur. I thought, "Well, I have to pay my dues. I have to go work for a large corporation, and I have to go learn things because coming straight out of school I don't really know how to do anything," but at the time my then boyfriend said, "You can do this." He had his own tech company, and I saw him doing it, and he was very supportive of that. So, I signed up, and a number of startups contacted me and I really hit it off with these two founders from the ETH -- the Swiss Federal Institute of Technology in Zurich -- and they-
Sal Daher: After which MIT is modeled, by the way.
Bettina Hein: Yes.
Sal Daher: The buildings. They wanted to build buildings like ETH, but they didn't have the money, so it's kind of a downscale ETH.
Bettina Hein: I did not know that. That's very interesting.
Sal Daher: Yeah, it was an architecture lecture from an architecture professor at MIT.
Bettina Hein: Really? Okay. So, I met these two technical founders, and they were still in an office at the university. They were still part-time lecturers and had received tech licensing from the university, and I said, "Okay, I will join you if we find a sales co-founder, someone that has sales in their background," and they said, "Okay, we'll look for somebody," and they found somebody, so I joined. They were very generous in saying, "Okay, we will give you a 20% in the company and we'll make you a co-founder." I was just surprised that anybody would do that because I was fresh out of university. I got my finance and accounting degree, I got the law degree, and I was just totally green, but they did that and it was a fabulous experience, and then I came to MIT.
SVOX Has a $125 MM Exit to Nuance Communications
We made that venture profitable, and eventually we sold it for 125 million dollars to nuance communications here in Burlington.
Sal Daher: Outstanding.
Bettina Hein: But then I came to MIT, and I knew I wanted to start another company, another tech company. I wanted to try my luck here in the big leagues of entrepreneurship in the US.
Sal Daher: If you don't mind, I just want to go back a little bit to SVOX. So, you were someone with a law and finance background -- just academic -- two technical founders, then you had the good sense to ask for someone with sales experience to be on the team. Ed Roberts would be gratified to hear that. That's like the perfect setup for a good team. So, please continue.
Bettina Hein Starts Pixability – Looked for Co-founders But Could Not Find Any Willing Takers – How She made Being a Solo Founder Work
Bettina Hein: So, then I wanted to start my next venture and see if I could play in the big leagues here in the US. I looked for co-founders. I did not have any network to speak of here in Boston because I had just moved here. I couldn't really find people that would start something with me, and then I looked into asking people because I knew from Ed Roberts, who had been my professor at MIT, that starting alone would be much harder. So, I asked around and asked people, "Do you think I can do this by myself?" Because, again, I didn't have the confidence. I didn't have the confidence to do it because I knew the odds were against me, but I, again, got support from that boyfriend, who was now my husband -- Andreas Goeldi -- and from other people around me said, "No, no. You can do this. You can do it," and I was like, "Okay. Okay. Biting my lip, I can do it."
It is much harder to found a company by yourself. You carry a lot more responsibility on your shoulders, but I don't mind the responsibility. I would have liked to have had more sounding boards and more people to support me, so if I were to go back, yes, I would try again and maybe even a bit harder to find co-founders. What I did to alleviate that disadvantage was find people that were very experienced executives that knew what they were doing in marketing, and in sales, in tech. I just made them more partners than employees, and that has been very helpful to me in the process of growing Pixability.
Pixability’s Storied Pivots
Sal Daher: Well, anyone who listens to this podcast knows I'm fascinated by pivots and all the stories I get told. Whenever I ask people, "What's your favorite pivot?" Pixability’s pivots have top billing, and we've heard the story several times, but we want to hear it from you. So, tell your side, the story from the inside.
Bettina Hein: I think there are a lot of things that are wonderful about entrepreneurship, but one of the hard things is that you have to admit to yourself that your idea is really crappy, and you have to be able to do that. I had the good fortune of starting Pixability in 2008 right before the economy collapsed, and you may say, "Oh, that's horrible, founding a company into a downturn is terrible." Actually, it is not. I did the same thing at SVOX, and what that does is it really, really forces you to focus on the value that you add. People are not going to sugar coat their opinion when things are being cut back to the existential parts of it. So, I started Pixability with the idea to create video highlights of people's personal footage. It was a B-to-C play, and I thought that this would be wonderful because my husband had been doing videos since he was nine years old, and I watched him create these videos for our family.
It was really, really powerful what he did there, so I thought, "Well, I can turn this into a system, and video's just becoming more ubiquitous." It turns out that it was, first of all, complete hubris on my part to think that I could go from automotive B-to-B to very small units in B-to-C. That was somehow, in retrospect, really crazy, so very quickly I realized this and we moved to business video. From there, the pivots were a little bit more natural. We figured out that, yes, we could create business videos and we could do that in a scalable fashion. We figured out that we can send out cameras, flip cameras that you may remember.
Sal Daher: The famous flip cameras, yes.
“We help large brands and their agencies place their video advertising and optimize it on YouTube, and we've expanded to Facebook, Instagram, and Twitter.”
Bettina Hein: Yes, to people and we can get them to send that back. This was before the days where you could upload large video files, or anybody could upload them. Then we figured out that the hard thing about creating business videos was, yes, creating them, but marketing them was even harder, and then we created video marketing software, then we realized, "Well, our video marketing software is great, but video marketing is a much too amorphous term," so we had to focused down on YouTube, which had won the war of the public platforms. Then we noticed that all the data that we were collecting on YouTube was really useful to place advertising. That is essentially where Pixability has ended up today. We help large brands and their agencies place their video advertising and optimize it on YouTube, and we've expanded to Facebook, Instagram, and Twitter. We've built this out as an end-to-end advertising technology solution.
Sal Daher: So, highlight for us the impact that Pixability has on the viewing public when making it possible for brands to put relevant content in front of the right people?
How Pixability’s Platform Impacts the Viewing Public
Bettina Hein: The platforms that we work on are huge and very confusing places. If you go on YouTube, there is just so much to choose from for the consumer, but even more so for the brands to put their advertising. It's very confusing. It's not as easy as putting your advertising on let's say "The Voice". You can buy television advertising there and that is relatively easy to do. If you have millions and millions of channels to choose from on YouTube that is really hard, so what we do at Pixability is we find specifically for each brand and each product the right context, and the right demographic, the right geographic, the right time of day to place their advertising.
“Consumers like it better, and brands get more out of it.”
If you are selling sneakers as Puma, you want different placements than if you are L’Oréal and you are selling mascara. So, we really find the right advertising for the right products, and because we do that people are more likely to get influenced by that advertising. They're less likely to skip it, and they perceive it as much more coherent in their viewing experience, which makes for a win-win situation. Consumers like it better, and brands get more out of it.
Sal Daher: So, you don't get 18-year-olds being shown videos for denture adhesives or something?
Bettina Hein: Yes, well those kinds of products don't quite work as well yet. We have tried TENA and Depends -- those kinds of products have not worked really well in our system quite yet. They may, maybe in 20 years from now they might.
Sal Daher Reads an iTunes Review from HealthTech617 – Asks You to Leave a Review on iTunes
Sal Daher: So, coming up next, I will ask Bettina Hein, one of Boston's most revered founders and a highly accomplished fundraiser, what advice she has for founders starting on their race. First, I'd like to thank HealthTech617 for reviewing the podcast on iTunes. HealthTech617 wrote, "Interesting guests with great stories to share and insightful discussions. Great listen for anyone interested in diving into the Boston startup scene." HealthTech, you give a fine example in writing a review. The Angel Invest Boston Podcast has outstanding guests such as Bettina Hein, is professionally produced, has no commercials, and comes to you free. The only thing we ask in return is that you help get the word out about it. Please tell an angel, or potential angel, or founder. Take a minute to review our podcast on iTunes. Sign up at angelinvestboston.com to be notified of new episodes and of upcoming, in-person, free events. Drop us a line at sal@angelinvestboston.com with any critiques or suggestions. Now, Bettina, you have a reputation among investors as a particularly effective fundraiser. Would you care to give some advice to other founders starting on their raise?
Bettina Hein’s Advice on Fundraising for a Startup
Bettina Hein: Absolutely. Happy to do that. When you start fundraising, it's important to know that things take much longer than you think they're going to take, and there is a system to doing this. What you have to start with is yourself. Are you willing to do this full time? I don't know of very many investors that will invest in a venture where the founders, or the founder, are not doing it full time. So, you have to start there. You have to say, "Okay, am I willing to do this full time?" You don't have to quite do it full time yet; what I would say then the next if you look at this as concentric circles -- it's yourself and your commitment and your team's commitment. The next circle are what we call the "three F's" -- friends, family, and fools. You have to find people that are willing to believe your story and that believe in you.
That sends a really important signal. If you have raised funds from the people that you're going to see at the Thanksgiving table, you're probably all in on this because you would face the embarrassment of having thrown that money out the window. So, that's the next circle, and then, after that, you have to look for individual angels. If you are a three time successful founder and have had hundred million dollar plus exits, you may be able to skip over some of those and maybe finance part of it yourself, but for most founders ... and that has been the case for me both times is that you have to start with these circles. So, once you've convinced an individual angel to give you money ... and I suggest looking for people that have some affinity to what you're doing. Let's say they share the same alma mater, they have maybe the same ethnicity as you, they've come from the same industry, so they really know what you're talking about and they have some sort of affinity or bond to you and what you're doing.
So, once you have that, these individual angels, that is then a signal that you could go out and do things like crowdfunding, that you could go out to angel groups because what you have to have is people that will advocate on your behalf. Funding is very much about the social context that you do it in. If you have these proof points, and at the same time you obviously need some proof points and milestones in your business, but then you can go further out, so you can then go to angel groups and then after that comes the seed funding and then Series A and beyond. A lot of founders think that they can breeze right through to Series A. I have not seen that happen, or very rarely, again, unless you are a multiple, serial founder and have proven yourself again and again, otherwise that's not really likely to happen. When you have had these proof points, people will then start spreading your message. I think, Sal, you came to Pixability as an angel investor because you heard from others this is a good opportunity.
Sal Daher: From Michael Mark, who was on the board at the time and he said, "You’ve got to see this woman. It's amazing." I sat in a meeting and I had some other information about you, and it really was impressive, which brings me to mind, when you're in a fundraise, how do you keep track of all your prospects? Do you have a formal system, do you use like a CRM or something? How do you keep track of everybody?
Bettina Hein: It's pretty much like any enterprise sales process. What I've done in the past is I've used a CRM or I've used a simple spreadsheet. I would recommend just a spreadsheet because you're not gonna be contacting thousands of people -- at the most 100 or 150 or something. So, I suggest keeping a spreadsheet and then going very systematically along the process -- first conversation, second conversation, sharing with them a term sheet, getting a subscription agreement.
Sal Daher: So, having a method. Did you find it helped getting over the rejections, the fact that you always had somebody next on your list to call?
Bettina Hein: Yes. I find that helpful, yes, because it is a sales process and you're going to get the rejections.
Sal Daher: Even Bettina Hein gets rejections.
Bettina Hein: Probably more than others because I've just done so much fundraising, so I've had many more rejections than the average person. I find it particularly helpful to close people using sales language, right? "ABC" -- always be closing. Close them just for the next step. Just get to that next step. You cannot expect someone to come in, meet with you, and then give you a check the equivalent of a nice medium-sized car just by having met you once. That doesn't happen, unless somebody else has vouched for you extensively, right?
Sal Daher: Yes. It has to be primed.
Bettina Hein: Right, and you have to go along those steps and you have to allocate enough time for it. That is something that is worth repeating time and again. A lot of founders think that they can spend one or two months fundraising and then they'll be all set and can concentrate on the business. That is never the case; very, very rarely the case. If you don't think that you're going to be spending six months fundraising, you're kidding yourself.
Sal Daher: Excellent. You raised money from angel investors to get your company off the ground, once you proved out the concept that you had, discovered the correct direction, you've raised venture money. Please tell us about how things change when you have venture money versus when you had just angel investors.
Bettina Hein on How Things Change Once a Startup Gets Venture Funding
Bettina Hein: Several things change when you have venture funding versus angel funding. Some things become easier and some things become harder. What becomes easier is that with angel investing, you have a lot of people that often times ... I have over 55 entities on my cap table, so there are a lot of people that are giving you input and it's very hard sometimes to decide whose input should you take. Who is right? Who is giving you the best advice? There's lots of these voices that sometimes it makes for a lot of confusion in the entrepreneur's head. So, that's the hard part. The easier part is that you have really a lot of areas of support, so you're getting a lot of perspectives, but you also have ... if things don't go completely right, you have a lot of potential people that can continue backing you. Yeah, some of the angels that I had in early rounds did not re-up for the next rounds, but that was okay because I had enough people to go to. With venture capitalists, what becomes easier is that you have less people to deal with. You can focus in on them and you can have much more one-to-one conversations. They do require much higher standards of governance.
They expect the level of board meetings to be a lot more structured, formalized, and you have to have a compensation committee. We don't quite yet have an audit committee, but you have to get a lot more formal about doing those things, and the motivations become a little bit different. With angel investors, there's always the part of getting a return for your money, but there's also that personal interest that people take in you, and I've always found that to be just a wonderful relationship -- somebody that really believes in you. It becomes with venture capitalists ... yes, they have to buy into you, but you become part of a big portfolio and you also become a little bit more replaceable, and in a way it's a little bit more transactional because it's not their money, it's a fund. They have more responsibility, but at the same time they also have to be a little bit more distanced from you, right? You can't go and beg them for more money if their partnership decides, "Eh, this is it," well, then that's it, so that makes it definitely more interesting, but very different.
One advantage of professional venture capitalists in your company is that they can help you with a different level of things regarding, for example, venture debt financing, or they have a much deeper pool of people to reach into in terms of helping you with recruiting. They are typically more specialized in your industry, so they will know who are the good recruiters, where can we get senior talent, what kind of talent do you have to get, and so that is where things are helpful. Also, what is really helpful is that they often have a portfolio in your industry, and you can talk to those CEOs, and they will often collect data on their entire portfolio, so you can benchmark yourself a little bit better. I find that really a big advantage of seeing how do I level up in relationship to these other companies that are out there.
Sal Daher: Tremendous. It's not uncommon for early stage companies, particularly tech companies, not to have a working board in the stage where angels are investing. What are they missing out by not having a board?
Bettina Hein Thinks Founders Are Scared of Having a Board So They Miss out on a Lot
“Many beginning entrepreneurs are scared of having a board. They fear the meddling in their business. They fear that people will force decisions on them, on the board. I have not seen that ever happen.”
Bettina Hein: A lot. They are missing out a lot. Many beginning entrepreneurs are scared of having a board. They fear the meddling in their business. They fear that people will force decisions on them, on the board. I have not seen that ever happen. If you are scared of that, you have to get over it. I love having a board. I think that that is one of the wonderful forcing functions as an entrepreneur. It really makes you be more disciplines. It allows you to look back on your business every month, every quarter depending on the rhythm that you have. It forces you, with your team, to get together and take stock of what you really have accomplished in certain amount of time.
“For me, often times the exercise of preparing for a board meeting is almost more important than the board meeting itself because it allows me to really think through the narrative of the company.”
For me, often times the exercise of preparing for a board meeting is almost more important than the board meeting itself because it allows me to really think through the narrative of the company. And, going back to fundraising, if you have regular board meetings, you have check-in points and you know where you stand, so if you have to go out and fundraise you pretty much have your story down because you have been regularly revising this.
Sal Daher: Every board meeting is a prep for a fundraise. One of Ed Robert's points was that the directors are there to make sure that the CEO was looking a little bit ahead of her feet.
Bettina Hein: Exactly. And I would like to give just a little plug here for a case study that Noam Wasserman, who is now at the University of Southern California, but before was entrepreneurship professor at Harvard Business School, did a case study, a video case study where my board at Pixability allowed cameras in the board room, and this case study called "Bettina's Board Walk" showcases an early stage board's functioning in a board meeting. I cringe every time I have to watch this again because no one brings me in for it, but I was really sweating; this was sort of a pre-fundraising board meeting and it was tough on me, but is really interesting to watch. The case study really helps people, entrepreneurs, understand what it is like to have an early stage technology company board.
Bettina Hein’s Way of Balancing Work & Family
Sal Daher: That's really valuable. That's extremely valuable. So, we have time perhaps for two more questions. One question's about work/life balance. I see a beautiful picture of your daughter at your desk, and I know that you've figured out a unique way of being a mother, being a wife, and being a top-notch CEO. I see this first hand with my daughter. My older daughter's a physician just finishing up residency and she had a baby in residency, and my wife and I pitched in. What advice do you have to a young woman who is in that situation? How do you balance your life?
Bettina Hein: So, I have had two children while being CEO of Pixability. Louisa is six and Jacob is three. It has been hard. I would be lying if I didn't admit to that, but it has also been a rewarding journey. What is important is to figure out what kind of support system you have. You help out your daughter. You and your wife help out your daughter.
Sal Daher: My wife more than I. I help somewhat, yeah.
Bettina Hein on Fundraising While Pregnant
Bettina Hein: Yeah. That's important. I don't have family here, so it was really important for my husband and I to figure out how we would do this and what kind of help we would get, and we decided to have a full time nanny, who has stayed with us for six years. But what also happened is that Andreas and I joined forces. He was not a co-founder of Pixability, but he joined right when I became pregnant with Louisa he joined Pixability in order to help, that we could coordinate this whole having a child and having a business at the same time. I also went through two fundraisings as a pregnant CEO. That was not easy.
I can tell you about it, but it is possible and it is a wonderful forcing function because I would tell the entrepreneurs, "You get a good price if ... See, look at my belly here. If you invest before that baby comes out, you're gonna get a good deal." You have to make it work. What it has forced me to do is to delegate more, which is an awesome thing to learn as an entrepreneur. It's taught me how to focus in on the more important things, prioritize ... All of those things are very useful lessons for any entrepreneur, so I would highly recommend motherhood and entrepreneurship.
Sal Daher: Outstanding. I think there's a biological connection that expectant mothers tend to recruit people around them to help them out ... there's an instinct for that. That's a little bit like a CEO, expectant mother/CEO nexus.
Bettina Hein: So, I also found that there is a real biological benefit to having a child because it strengthens your executive functioning, your prefrontal cortex, and I've made a lot of the important strategic decisions at Pixability after I've had a baby because you are just so focused on concentrating on the most important things that it really makes for great CEO decision making.
Sal Daher: You put aside all the clutter. You just go for the stuff that's really important.
Bettina Hein: Absolutely.
Bettina Hein on Marketing Technology’s Crowded Landscape
Sal Daher: Tremendous. Tremendous. Whenever I look at a graphic of industries, of companies in the marketing technology space, I'm astonished. One graphic showed 3,500 companies in 2016, and that number's growing at an astonishing pace. What do you make of this growth of the number of players? Do you think there's some consolidation coming?
Bettina Hein: Yes, consolidation is definitely coming. A lot of the companies that are out there are more features than they are companies, so there will be a shakeout. We're in marketing technology, but we're specifically in advertising technology, and there are thousands of companies in that space alone. I think that there will be culling happening, and that is going to be unfortunate for those companies that don't make it. But it's necessary for that industry to move forward. The exciting thing about this industry is that the CMO is becoming much more of actually a chief marketing technologist.
The investment in technology, and also the ability of the marketer, the capabilities that a marketer has to have and that is really coming up the ranks ... people that understand what kind of a role tech plays in this industry. So, to me, it's not astounding at all that there is this explosion because people are putting these things together, and just as there was a big ERP wave, right? Or a big content management system for the web wave. Marketing technology is just the next frontier, and that has an explosion of creativity and that's wonderful because it helps bring those best solutions to the forefront.
Sal Daher: So, perhaps after this initial stage, things will consolidate a bit and then the way forward will become clearer and then that will probably lead to a faster growth of the remaining companies.
Bettina Hein: Yes. Yes, and it will make it easier for the marketer to make those decisions. Right now there's a lot of confusion, and I think the decision making is slowed down because there are so many options.
Sal Daher: Bettina Hein, I am immensely grateful for your generous help in making this great podcast. I'd like to invite our listeners who enjoyed this podcast to give back a little bit and review it on iTunes. Sign up at angelinvestboston.com to be notified of future events, including in-person events we'd like to hold. Please address any suggestions and critiques to sal@angelinvestboston.com. This is Angel Invest Boston, conversations with Boston's most interesting angels and founders. I'm Sal Daher.
Bettina Hein: Thank you so much for having me, Sal.
Sal Daher: It's a pleasure. I'm glad you were able to join us. Our engineer is Raul Rosa, our theme was composed by John McKusick, our graphic design is by Katharine Woodman-Maynard, our host is coached by Grace Daher.