About this episode

This week’s guest is Tom Fairey, the founder of Stakester. Stakester is an entertainment platform that gives gamers a platform to add monetary pride to the online gaming community. Through proprietary technology, Stakestir acts as the third partner in gaming challenges to ensure payouts are handled correctly.

The technology that Tom and the rest of the team over at Stakester uses is truly remarkable. However, the circumstances from which Stakester was born are even more amazing. Tom once got cheated out of his winnings when sparring with a massive Russian; that is where his entrepreneurial journey began.

To hear about the dynamic story of Tom’s major loss and eventual startup of Stakester, tune in. Throughout our conversation, you will also hear how he raised over a half-million dollars using a cold email outreach strategy. This entrepreneur accomplished tremendous feats through unprecedented tactics and he is sharing all about it right here.

In this episode, you'll hear:

  • The 3 things you must sell when you start out as a founder.
  • How to get great people on board with your startup to help solve your problems.
  • What Stakestir is.
  • How Tom losing money in a Jujitsu match gave him the idea for Stakestir.
  • Tom’s first startup experience.
  • What was so appealing to Tom about startups.
  • The role of resilience in entrepreneurship.
  • Why it’s so important to focus on the minimum value you provide to your customers.
  • The first few steps to take to get your startup going.
  • What you as the founder should do and what you should hire someone else to do.
  • How to balance your messaging to the 3 core sectors you must communicate to as a founder.
  • Tom’s funding strategies at the beginning.
  • The 3 rules he used to send the cold emails that got him tons of investments.
  • How to define your buyer persona and why that is so integral to your growth.

Resources from this episode

Join Grindology: https://grindology.com/

Tom's Cold Email Template: https://medium.com/swlh/a-5-step-guide-to-raising-angel-investment-during-the-crisis-3af4ece58258

ExpressVPN: Get 3 Months Free → ExpressVPN.com/StartupStory

Get Emails: https://app.getemails.com/referrals/newaccount?ref=R18HWW5

The Startup Story Inner Circle: https://www.thestartupstory.co/vip
The Startup Story on LinkedIn: https://www.linkedin.com/company/thestartupstory
The Startup Story is now on YouTube: https://www.youtube.com/jamesmckinney
The Startup Story on Instagram: https://www.instagram.com/thestartupstory

Tom on LinkedIn: https://www.linkedin.com/in/thomasfairey/

Tom’s podcast, The Back Yourself Show: https://podcasts.apple.com/us/podcast/the-back-yourself-show-with-tom-fairey/id1485236149

Stakester: https://www.stakester.com/

Share the podcast

The Startup Story community has been so incredible sharing our podcast with others, and we thank you! We do have more stories to tell and more people to reach. There are three ways you can help.

First, the most powerful way you can support this podcast is by leaving a review on Apple Podcasts or wherever you listen to podcasts.

Second, follow us on Facebook and Instagram, and be sure to share your favorite Startup Story episodes with your friends and on social media. Tag or mention @thestartupstory.co so we can give you a virtual high five and a thank you!

Lastly, share the podcast on LinkedIn. The Startup Story podcast is for entrepreneurs. Don’t underestimate the power of sharing on LinkedIn so other entrepreneurs can discover us.

With your support, we hope to further our reach in encouraging and inspiring the founders of today and tomorrow. Thank you!

EPISODE CREDITS

If you like this podcast and are thinking of creating your own, consider talking to my producer, Danny Ozment.

He helps thought leaders, influencers, executives, HR professionals, recruiters, lawyers, realtors, bloggers, and authors create, launch, and produce podcasts that grow their business and impact the world.

Contact him today at https://emeraldcitypro.com/startupstory

Episode transcript

Tom Fairey, founder of Stakester

Tom Fairey: Hey guys, I'm Tom Fairey and I'm CEO and founder of Stakester, and this is MY startup story.

  • Every wildfire began with a spark. Every superhero has an origin story. And every single startup has a moment that they point to as their beginning. And every founder has a purpose that drove them in the midst of all obstacles. THAT is The Startup Story. *

[00:29]

James McKinney: Hello everyone and welcome to another episode of The Startup Story. Before we jump into this week's episode make sure to visit thestartupstory.co/yourstory and submit your story for consideration for a future episode. We're always looking for an incredible founder story and one that most people might not have heard, and it might very well be yours. Now, we can't guarantee that just because you submit at thestartupstory.com/yourstory that your story will be selected for an episode, but it is absolutely the best possible way to submit your story for consideration. Now let's jump into this week's episode.

My guest this week is Tom Fairey, the founder of Stakester. Stakester is an entertainment platform that allows e-gamers a platform to add some monetary pride to the online gaming community. Through their use of proprietary technology they are able to be your third partner to any gaming challenge to ensure payouts are handled correctly. Picture you and I out there, playing some basketball. I think I'm a hotshot, I want to put some money on the line, and I'm going to say I'm good for a 10 spot on this. You say, "James, I could probably beat you. I'm good for a 10 spot as well." Well, Stakester would be like that third person there taking our money, holding it for us until the challenge is over, and upon completion the winner gets that money.

Now you ought to be asking how does it do that for online gaming? And we cover that in this episode, because it's quite remarkable the technology they're using to accomplish this. Now, the technology itself is really cool but the fact that Stakester was born out of a situation where Tom got cheated from some winnings while sparring with a massive Russian is what makes this entrepreneurial journey truly dynamic. To add even more value to the episode, Tom shares how he utilized a cold email strategy to his fundraising efforts, and that cold email strategy resulted in him raising £400,000 or for my US listeners about $550,000 out of a £500,000 round. Yes, you heard me correctly. He raised over half a million dollars using a cold email outreach tactic, and he shares that tactic in this episode so make sure you listen through. This episode has some tremendous learnings for all of us, but like all great stories we need to start at the very beginning.

[02:48]

Tom Fairey: I grew up in an academic household, right, so both my parents teachers in academics. My brother, super nerd, massive physics geek. So I was the outlier because I was interested in sports and drama, and you know like when you're at school being in sport and drama is a recipe for let's get teased. What I realized people would say, "Do you have an entrepreneur mindset," I always think it's really interesting, and I think actually no I don't. I don't have an entrepreneur mindset. What I do have is a team building mindset. I always say to people I am, I always think of myself as a collector of talent. So when I was a kid I was always really keen to find out who was the best at a particular sport and I wanted to train with those guys. When I was playing rugby I was just trying to find what's the best team, I want to be on that team. I'm heavy into martial arts and I was like where' the best martial arts, which one is winning all the titles, I want to be in that. Which drama society is the one smashing it, I want to be there. Because I think obviously I'm trying to stand out in front of my parents because they're the academics, and I'm like yeah but look at me. I'm winning over here.

And then I discovered something quite young which was I realized… when you're a kid, and I did well in school and the career options available to you are accounting, investment banker, things like that. I discovered selling really early on. I discovered this as a thing because I went on work experience and I come from an island at the bottom of the UK called the Isle of Wight which has a population of like 100,000. It's super sparse, it's like everyone there is 100,000 years old, old people. There's no industry there apart from tourism, and I went up to the big smoke, up into London, and I went on this work experience. There was a guy there and his name was Nick, Nick Hucker, and he used to go to all these bit companies. He had a really fancy apartment, a fancy car, and you know he had a really thick girlfriend, and I was like this guy is a king. I remember thinking when I was with him, I was just like what does he actually do? He just goes to meetings and talks about product. He's like, "I'm an account man." I'm like, "What's an account man?" He's like, "I sell to people." And I was like, "Isn't selling door to door salesmen?" And he goes, "No, no, no. I sell the big stuff."

And then I realized all the sudden this was a career. It didn't matter what you were doing, like he had… but I also did work at a couple of accountancy firms and I was like this is so boring. [inaudible 05:15] the time. So I was like this is the dream for me so I was like I want to work in sales, I want to work in sales. I don't know what I want to sell, but I want to work in sales. And that was really the big influence for me because I realized even then I was already selling. I wanted to be captain of my teams at school so I sold to that. I'm the guy, get me in. I'm the guy, I can make this team get somewhere. I can turn this from A to B and I can get us the dream, and then setting the dream then. Then like when I was trying to get my show on the stage at school I would be selling to the teachers like, "Yeah, this is the show we should be doing." And that was really what got me into it. So yeah, I think I'm just a sales guy and a team builder. An entrepreneur for me is a problem solver. A guy sees a problem in the world and wants to solve it. I think I have that but it's not my core passion. I haven't seen a problem in the world and thought, "I need to fix it," in the same way. What I've done is I've seen something I'm passionate about and I know I can find the people who can fix it, because I know that I like to build teams.

[06:11]

James McKinney: You know that's interesting and I want to jump around a little bit. Usually we continue on the life journey to see all the breadcrumbs of life that get us to where we are, but you said something interesting about your character and your makeup. You're really good at selling, right? But part of what being an entrepreneur is, to your point, is problem solving. It's building something from idea to market, and as a sales person I would put myself in that same boat. We're hype men. We can sell the dream and the vision, but there's still so much that takes to get that product to market, or that service to market. And again in a technical space which is where you come from in Stakester, and we'll get to Stakester later on, but especially a technical space unless you're a developer you then have to sell the idea of bringing a technical cofounder on, and all the other things that come with it. But as someone who is wired for sales do you find it challenging to build a startup because in your mind you're like, "Just get me the product and we can go from there." Because again from zero to launch, there are thousands of steps, sometimes thousands of days. Definitely tens of thousands of dollars before you can get to the point where your strength can truly kick in. do you find that to be challenging and frustrating for you?

[07:29]

Tom Fairey: Yeah. I'm going to, and James this is your podcast so how dare I, but I'm going to challenge you.

[07:34]

James McKinney: Please, go ahead. No, challenge away, challenge away.

[07:37]

Tom Fairey: I'm going to say that you're doing it from day one. So let me tell you the story about how I found my cofounder. So when I came up with the idea for Stakester, and we'll mention that later, I'm not a product guy. I'm not a tech guy, I just had an idea and I was like first of all when you see that problem as a team builder you see the problem, you're like I need to find someone to fix that problem. And then that person, I don't have the money to pay that person, I've got to sell the dream of what we could create and the value of that to that person. When you start out as a founder there's three things you can sell. Principally you have to give someone a clear and believable path to how they can become incredibly wealthy, but it has to be in three areas. The first one is wealth in the experience. It's saying look, you are going to have the experience of building something from scratch and that, throughout history people have always yearned for that, I want to build my own house, I want to build my own family, I want to take something from nothing to something. That's intoxicating. You want to sell that dream to that person.

The second thing is rich in notoriety. The truth is if I said to you now, "James tell me all the people you know who would number 100 plus in the business," and you'll be like, "I don't know any." Tell me the founders of some amazing businesses, and you'll be like, "Oh."

[08:53]

James McKinney: Yep.

[08:54]

Tom Fairey: Here's a list of all of them. People remember the first ones. They always do. They remember the first person to run a four minute mile in a marathon, Roger Bannister. They remember the first person to go 9.6 and that's obviously Usain Bolt. You remember those people, you always remember the first. So that notoriety will never leave you to be one of those founders.

And the third of course is money, there is the opportunity there. And there's nothing wrong with being motivated by money but it's something that comes with the success of a startup. So for me the first thing I did, I don't have that person, I don't have that technical cofounder I need. So it's a funny story. So I'd figured out that eSports is where I wanted to go so I pick up the phone to a friend of mine, Monica, who is also one of my cofounders. Said, "Monica, hey look. Have you got any connections in the gaming space? Because this is what I want to create, and I don't have anyone to do it with me." She goes, "Well have you met my fiance?" I was like, "Monica, I don't want to meet your fiance, yeah? Okay? I don't want to meet him." She goes, "He's one of the co creators of Grand Theft Auto." "Oh, okay, all right. Well what's he doing tomorrow night at 6 o'clock?" She's like, "What, you want to do a call?" "No, I'm looking at sky scanner now. I can be in New York tomorrow at 6 pm," pre COVID.

So I jump on a plane, I fly over to New York, and that's the salesman in you. If you're a sales guy I want to meet you face to face. I want to see you eye to eye. So I sit down with Gary. He's British so obviously he's incredibly intelligent. I said, "Look Gary, this is my idea," and I told him. He's there and he's rubbing his chin, he gives me a list of 30 reasons why it's not going to work, and then he's like, "But I'm in!" I'm like, "Yes," and that's the story. That's where the selling come sin. That's where you're pitching from day one, because you've got to find the people who can solve the problem. If you know how to pitch and you know how to get people excited, and bring that emotional contagion into the room you're going to find great people who are going to solve those problems for you.

[10:44]

James McKinney: I don't want to do wrong by my audience. We've talked about Stakester a few times, so just so that my audience has a context for it, explain Stakester to everybody listening.

[10:53]

Tom Fairey: Let me create a scenario so it's really easy to understand. So you play any eSports? You play NFL?

[10:57]

James McKinney: Absolutely.

[10:58]

Tom Fairey: Okay, well look. I'm better than you so what I'm going to do is I'm going to chuck in a tenner, you chuck in a tenner, and then the winner takes the pot, all right?

[11:04]

James McKinney: Okay.

[11:05]

Tom Fairey: That's literally what we do. We create a platform which allows people to play games of skill against their buddies, against people they don't know, and they just put the money in, 10 bucks in, winner takes the pot, and we facilitate that for them.

[11:17]

James McKinney: Is the game played on your platform?

[11:20]

Tom Fairey: No, the game is played on their platform, so it's played on console. Predominantly on console, Xbox or Playstation.

[11:26]

James McKinney: So if you and I want to play, we go into Stakester, we each put up our 10, and we go to play the game. Where does the release of that money come from? Both parties just being people of integrity? Is there…

[11:37]

Tom Fairey: No, yes so you put money into our platform. So you submit the money in. that's the whole thing around trust. So let me tell you the story about how… You want to hear the story about how this started?

[11:45]

James McKinney: 100%, absolutely.

[11:46]

Tom Fairey: Okay, right. So I'm into my martial arts. I'm not particularly good but I am into it, and I'm on the mat in the gym. Had some success previously and I'm on the mat in the gym doing some jujitsu, and this Russian guy walks in. he's wearing a vest and he's hemped and I'm not, and he's like, "I recognize you. You win competition." And I know this accent is perfect-

[12:09]

James McKinney: 100%.

[12:10]

Tom Fairey: … it's one of my investors is Russian and he loves it. "I recognize you. You win competition." I was like, "Yeah, I did win a competition, thank you." Not for jujitsu, for something else. But anyway doesn't matter. Then all of my people around me are like, "Oh, don't do this. This guy is so arrogant, shut up. Don't do this." But then he fires up and he says, "But you look so weak." I was like oh all right, I'll break him. I laughed and was like, "Cheers mate." And he said, "What about we spar some time?" And I was like, "All right." Who's this guy? I don't even know him and he's challenging me to a duel. And I said, "Okay fine." And he goes, "How about we put the money in?" Anyway, so at the time I didn't know this was a cultural thing for Russians. They like to play for money. So I agree.

For any of you listeners that are listening, you've ever done any jujitsu, they know that actually because you're big and strong doesn't mean you're going to win. Anyway, so he comes in. don't want to get too technical but basically I pull guard, I get him in a triangle, and then he taps out. Right, okay. And he gets distraught, and he just goes off. And I'm like, "Whoa, whoa, where's my money?" And he goes, "I get you next time." And I'm like, "No, that's now how this works buddy. You pay me now." And he goes, "I have no cash." So I'm like well I'm not giving this dude my bank details, so I'm trying to find an app on my phone, and then [snap] the light bulb goes. This is culture, this is what we do. James you remember when you were a kid and you're playing pool with your buddies, and you're like, "Yeah, let's raise the stakes on this." Used to do it all the time. And it might even be for beers, it might be for pizza, it could be for anything. Yet that's kind of disappeared now because we don't carry cash, and also when it comes to eSports we're playing internationally. I'm not going to give some dude I don't know my bank details, but I want that excitement of playing. Yeah, we call ourselves an entertainment business. All we're doing is we're not about gambling, we don't believe in that. What we're here for is we're here to just add a little bit of spice to something you already enjoy.

[13:54]

James McKinney: Absolutely love it. But how do you, back to you and I playing NFL online together, if I beat you which is highly likely, if we're doing that what is the system in place that we come back into Stakester and just through integrity I say, "I won, you lost," and we report back, gets released?

[14:13]

Tom Fairey: So yeah, there is that. So you go in, you say you did, but you take a photo. You take a photo of the winning screen and then we have some AI in the background that reads it and then tells if you're talking smack or not.

[14:22]

James McKinney: So even if you decided, "My dog was distracting me, James, you got two touchdowns. That's how you won," as long as I take a photo your AI will recognize the win so you couldn't be a poor sport and not report it. The AI will take care of it and release it?

[14:35]

Tom Fairey: Correct, yeah. And we've had, we do have some contentions that of course like anything else, but they're below 1%. They're super low. And we always say the relative is like people aren't there to make money, people are there to be entertained. If it's $10 the most you can do is double your money, right? So people really aren't that fussed. It's not like… so people are pretty well behaved, and we have a really low, we have a zero tolerance relevant to that. So if we find that someone is trying to hustle we're just, "Mate, get off. Go and play someone else."

[15:04]

James McKinney: Yeah. Oh, love it. Now you mention in the telling of the story that you had previous success with other startups. What was your earlier startup that you had success with?

[15:11]

Tom Fairey: So I was really lucky, well there's a story actually about getting startups is always a funny one. I think any entrepreneur can relate to this. So I worked for a company that you know because you're in the US called Dun & Bradstreet. I had a senior role there and I was really blessed. I had a really great career and I was doing incredibly well. I got approached by a couple of guys who were like, "Hey, we're starting a company and we're looking for a guy to do the growth." I said to him, "Just let me answer this. Wait, so you're asking me to leave my incredibly well paid job with a car and a pension, and commission, and you want me to not get paid to work for your company? Dude, you're smoking crack."

[15:45]

James McKinney: Yeah, yeah.

[15:46]

Tom Fairey: Like what's going on here? But the idea was cool, I liked it. I remember really vividly what happened. The guy in question, Vishal, like a real sensational guy, he said to me, the same deal, he says, "Tom, can remember any of the people that worked at companies or can you remember the people who founded those companies?" And I was like, "Oh, you've got me."

[16:08]

James McKinney: That's incredible.

[16:09]

Tom Fairey: Yeah, such a simple pitch. Such a simple pitch. I had a really great ride there. So I mistakenly called myself a founder for a long time, but actually I wasn't really a founder. What I was, I came in like month three. I was a founding employee I would say. Yeah, I took some sacrifice, yeah I took the plunge and took the heat like everyone else, but I wasn't really a founder. I was say a founder is someone who came up with the idea and has stayed up late thinking how the f- am I going to make payroll. Do you know what I mean? That's it, you've got to feel that pain. And I hadn't really felt that pain. And so I was, and we had great success. We were at like almost 200 employees in two years.

[16:47]

James McKinney: Wow, wow.

[16:48]

Tom Fairey: We really smashed it and my part of it, we were part of every big bank in the world and that was great, but we had other people. There were eight of us in that founding team effectively, of which you had. And so what I realized was as I started to surround myself, I went on to the accelerators. I did the Microsoft accelerator, I did one with PWC and city and so forth. I was surrounded by these other companies that really felt like startups. They're wearing hoodies, they're on bean bags, they had cool merch and all this kind of stuff. I was like man I'm not really a founder, I'm part of a well funded corporate. We had a lot of money. We'd all put money in, we were super well funded. It wasn't really the same as like a real core startup in the same way. Not taking away from these guys at all, they did an incredibly good job, but it's very different to what it's like. They were really a spinout of a previous business.

[17:40]

James McKinney: Okay, yeah.

[17:41]

Tom Fairey: I was addicted to the startup world. Once you get the bug like damn you want to be part of it. So I'd had all the experience of what it'd been like to be in a high growth startup but I wasn't really a founder. Then when you go on that founder journey you realize actually how hard it really is.

[17:55]

James McKinney: It's interesting you mention that too because a couple episodes ago we had Matt Barnett, the founder of Bonjoro, and Bonjoro came to be because of a product that he helped develop out of a large enterprise, and they were seeing a different use case for it. And so he spun it out completely with no funding though. He literally just said, "Hey, I want to take this to consumer side." He bought some of the technology and spun it up. He acknowledges how different it is building something in a large enterprise where you have this massive financial backing to where the moment he took the technical solution outside of the enterprise to build it himself, he was like it was a world of difference. It is night and day when it's your pocket book trying to figure out how to sell it, how to build it, how to fundraise for it.

When all of that sits on your shoulders it changes the game on how you move forward. For a lot of people they can't handle that, it's paralyzing to them. There's just too much and I think the media has glamorized what it means to be a startup founder. The media has taken this idea that you have a great idea on a napkin, you apply to Y Combinator, and all of the sudden you're in there and you're going to be filthy stinking rich at some point because you're going to get so massively funded. That is not the journey; that's the anomaly. So what was it about you being around the startup scene that became so addicting for you, knowing that you are seeing success with this? And what was the name of that previous startup where you were seeing success?

[19:15]

Tom Fairey: Quantexa.

[19:18]

James McKinney: What was the industry that was in?

[19:21]

Tom Fairey: Financial crime prevention.

[19:23]

James McKinney: Interesting. So I could see how you probably leveraged some of your learnings with Quantexa to Stakester, and again back to the breadcrumbs of life things just kind of play off of each other. So being in that environment where you are well funded, you're seeing significant success and growth, what was it about the startup scene that was so appealing to you?


[19:43]

James McKinney: All right, before we continue on with Tom's story I just want to ask you, The Startup Story listener, a quick question. How valuable would it be to have direct access to some of my past guests to learn exactly how they executed certain strategies to grow their businesses? Well, that is the experience and knowledge sharing that is available to you in each quarterly box when you become a Grindology member. Grindology is an entrepreneurial subscription box that ships every quarter full of resources to help fuel your grind and your hustle. Now what's included in your Grindology shipment you might be asking? Well each shipment delivers two bags of uniquely crafted coffee, specifically roasted for you, the founder, the hustler, the entrepreneur, the maker and creator. Each shipment also includes an exclusive mug that speaks to the unique nature that is you, the entrepreneur.

And lastly, and most importantly, every single Grindology shipment will include a copy of the Grindology tactical manual. Every single issue of Grindology will be chock full of real tactics from real business builders, not journalists. Within the pages of the Grindology tactical manual we will be delivering to you tactics and starts you can integrate into your business immediately. How great would it be to receive full marketing funnel strategies from those who are doing it? Wouldn't it be helpful if a successful founder laid out specific user acquisition strategies that they use to grow their business? Well, those are the types of tactics that you will find in each issue of Grindology. Like I said, real tactics from real business builders. Everything about Grindology is about helping to fuel your grind, and that is why our friends at Design Pickle have partnered with us for our first shipment by hooking up one lucky subscriber with a full year of unlimited graphic design services. You can visit grindology.com to learn more. Like I said earlier, we are shipping this box now and it is an exclusive shipment so make sure to secure your box today at grindology.com. We'll include a link to grindology.com within our show notes for easy access. Now let's get back to our episode.


[21:43]

James McKinney: What was it about the startup scene that was so appealing to you?

[21:48]

Tom Fairey: First and foremost is the people, right? There is something about people who work, who are attracted to startups. They're the most incredible people on the planet. You think like I worked in super high caliber organizations with high caliber people who are really impressive. It's another level when you work with startups. The greatest people don't want to be told what to build. They want to build it their own way. That's the reality of it. It's like the greatest sportsmen of all time, they're the ones that just did it their own way. That's the reality. I remember arriving at the Microsoft accelerator after we got on. I walk in, a friend of mine and that's one of my great friends, really tight. I met him and it's just like I couldn't believe his knowledge about the world. You know about all these problems and all these banks, and all these issues. You're like 27, like it's mad.

Then you meet other people and the ambition you find. I met a guy who's like, "Yeah, yeah, yeah, we're building a… we're completely changing payment solutions for banks." And I was like, "What?" He's like, "Yeah, yeah, we're going up against people like Visa and MasterCard." You're going up against who? Like this ambition, and I was like God I want to be part of this. All I'm doing is I'm replacing stuff that I've been replacing for my whole career. I'm just version 4.0 of the same thing that'd already been doing. I'm just adding a bit whereas these guys are revolutionizing the space, taking it, and that's so intoxicating to me those kind of people who have that ambition but they have the talent and the drive to build it up. Also the resilience. I always think resilience is such an attractive quality you see in people. You talk about resilience when you work in a corporate, and yeah the fact of the matter is your job is only ever as safe as your notice appearing. That's the reality. It could change at any moment right. But getting fired is hard, failing at a startup is easy.

[23:40]

James McKinney: Yes, yes.

[23:42]

Tom Fairey: It could happen to you. At the moment, our business, we've got very lucky. We've got like a year's runway, but we could start spending badly on adverts and they don't work out, and we could not be here in three months.

[23:51]

James McKinney: It's amazing to me with the startup founders to your second point about resilience. The ambition is one thing and there's a lot of people that can have massive ambitions, but it's moving forward on the ambition despite all the people that tell you it is crazy. To your point, the people that are taking on visa and Mastercard and they're a startup. You look at these legacy brands and you're like, "You're trying to accomplish what?" A week or two ago I had the founder of BRUNT Workwear who is trying to cater to the modern day tradesman with boots and work clothes, and he's trying to take on the Dickies and the Carharts and the Levi's, and he's trying to take on these massive legacy, hundred year old brands because they're not serving the modern day tradesman. At first I was like that is crazy. But then when you hear him unpack why this problem needs to be solved, you're right it's intoxicating. Oh, I can see why this is an opportunity that most people would overlook. You go into this knowing the chances are highly in favor of you failing. If anybody is a realist you know the data points, and you are not going to succeed but you continue to move forward up that hill because you believe that you're the exception and you just try to execute well. I absolutely love every bit of it.

Back to Stakester now, having been around the successful growth startup that is well funded, having been around those who are building something from nothing, having had an encounter a large Russian and you started developing Stakester, again to go from idea to product is where most people will either stop or they'll get discouraged by it, or they'll just kind of not even pursue it because they don't know how to connect the dots. Again, you're not a technical person. What was that first step for you? The moment you beat the Russian and he wasn't paying out, what was the first step for you when it came to building and moving forward on Stakester?

[25:47]

Tom Fairey: I owe this credit actually to a guy who runs a fund now called Consilience Ventures, shout out to a guy called Kevin Montserrat. He's a French guy, incredibly sexy, and he says, "Thomas, you're not to worry about the MVP, you worry about the MVV." And I'm like the what what? "The minimal viable value." And I was like, "Wow. What is that?" He's like, "Look. You need to worry about what is the minimum value that you can give to your customers in order that they will pay for your service. That's it. What's the minimum value. Don't worry about MVP. So I started, answer these questions, what is the minimum value I need to off to my customers? What is it? And also what are they getting out of it? I'm very much… I use the tree model of thinking. So what I do is I start to really understand that trunk first, where I really get into that. What is that value, I don't move away from it. That's where I focus. Then it starts to peter off and it's like how can I show this, how can I show that. How can I win it from this person, which audience do I go to. But you've got to focus first and foremost, more than anything, on that value to give to your customers. If you focus on that relentlessly everything else becomes easily as you bring it back to that. The mistake that founders make, and I coach new founder and I invested, is that they get distracted from their original cause. When you think about the best products in the world, people are like, "Uber." The minimum viable value for Uber, the minimum thing I get from there is does it allow me to order a cab on my phone. That's all I need to know.

[27:22]

James McKinney: Yep, yep.

[27:23]

Tom Fairey: Right? Airbnb, can I book a room on my phone. That's what you need to provide and then everything else comes from there, so that's what I did. So I just figured that out. Then I just started mapping out that journey, being like how do I get my customer from here to there. Then you start looking at needs and problems. You're like okay right, I need to have an audience of this size in order to provide this. I need to have this game because of this. The next thing you do which is I really believe in is you've got to plan that team out. The one hack I would say to everyone is write down everything that you need to happen in your business and try as best as you can to make sure your name is next to none of them.

[28:00]

James McKinney: Interesting.

[28:01]

Tom Fairey: Okay? Because you aren't good enough at it. As a founder, you need to be good at three things: pitching to investors, pitching to employees, and making sure everyone knows what the strategy is. That's all you've got to do.

[28:13]

James McKinney: Would you say that's from a day one founder position?

[28:17]

Tom Fairey: Gosh, that's a tough question that one, isn't it? That's a tough one. It depends on your situation. I think from day one you should be thinking about how you can hire people better than yourself. You've got to have real self awareness. Know what you're the best in the world at and then hire people who are the best in the world at the other things. For me it's easy, because I'm rubbish at everything. I'm not good at marketing, I'm not good at product, I'm not good at design. I'm not good at operations. It was easy. I need someone for all of this.

One tip I say to everyone is never underestimate how much people will do for you without being paid. It doesn't mean they're doing it for free. They are getting something out of it, whether it be equity or whatever it is, the experience, whatever. But it's not about pay for a lot of people. People just want to be part of your journey so involve people. It's amazing what people will do.

[29:06]

James McKinney: Do you think the ship has sailed on the idea of having technical cofounders or technical partners that will do it for equity only?

[29:16]

Tom Fairey: No.

[29:17]

James McKinney: You still think there are developers out there that will do it? And the reason I ask that question because the percentage of failure is so high, and from a developer perspective your controls over the success truly are product only. So I hear from a lot of cofounders how challenging it is to find a technical cofounder that is willing to do it with the same amount of risk that the primary cofounder is having, which is nothing.

[29:43]

Tom Fairey: So no, I don't think that's the case. I think the reality is it comes down to your role as the first founder is to create a clear and believable path to how others in your organization can become wealthy. People will work for you just for equity, but it's not just about equity. It's not about that. Equity is the mechanism by which they get rewarded financially at the end, provided you are selling someone the journey and experience that they're going to have with you, the notoriety they're going to gain. Then people are working for that. If you are working, finding a cofounder and it's just a transaction that says right, I'm going to pay you in equity, that's a different conversation. People want to be part of something successful. People want that. I remember talking back to when I was a kid I just wanted to be around the best teams. I wanted to be around the most talented people. Because it's intoxicating to feel that you're a part of that. If you can articulate that to people and they can genuinely feel that you're going to create something that's going to change the world and be the best at what they do, you'll be knocking them away, I genuinely believe that. And I've seen it happen, I've experienced it happen. That's your role as a founder to be able to articulate that.

People can smell when you don't believe in it. If you don't believe in what you're going to do then why would anyone take the risk to come and work for you?

[30:59]

James McKinney: Absolutely. You have got to absolutely believe to the very core for people to come on board. One of the things that I found interesting about what you said earlier about the three core strengths that a primary founder has to have is the ability to rally those to secure those people around you that are better than you, the ability to pitch investors, and then the ability to communicate your vision to your team so that they're constantly on board with it. From your growth in Stakester, when you think back to how you began in your early days, keeping a focus on those three was obviously critical to where you are today. But how did you balance the messaging across those three sectors? Because they're different audiences.

[31:45]

Tom Fairey: You know what, it's hard James. It's a hard thing to do. Let's start with the people internally. The strategy was to be in the business. That's not actually as easy as people think it is. Oh, create chatter, it's not that easy because everyone in your business will see things that they see are more valuable. They think that the work they do is more valuable. They think it's more valuable than someone else in the organization. They might have a different vision for where your business is going. And it might be that their vision is better than the others. It might be better, it might be a better route. But if you don't have everyone in that ship trying to go the same direction you're going to fail.

Whether or not that might be the best or not, you've just got to take that hit and you've got your role as a CEO is to choose what that vision is. You can take as much information as you want from other people to make that decision, but you have to make that decision. You've got to make sure everyone is going in that direction. We've made that mistake at Stakester, where we've been moving slightly different ways. Then it's taken us off of course, we've had to come back on but that's your job because you are literally as the phrase says at the helm of that ship, and you've got to make sure that you stay true to that course. If you don't, you'll waste time and then investors come in and you fail. I believe that happens a lot.

[32:53]

James McKinney: 100%, absolutely. So let's talk about the investor side of things, the funding side of things. Now you've had success, again you had success along the way and for those listening they might inherently think, "Well, he probably just self funded everything from the get go." What was your funding strategy and the tactics you employed early on to get to… First, let me back up. Let me just remove some assumptions real quick. Have you had, what round of funding have you gone through? Friends and family? Angels? Series A?

[33:19]

Tom Fairey: No friends and family. At the very, very beginning and I'm completely transparent about this, I funded two things. I funded basic setup so like the main name, Gmail, basic stuff like that. I funded that in the very beginning. But everyone who worked for me at the beginning they took salary sacrifice. They bought equity in my business for salary sacrifice. Everyone who came on in the beginning did that, and I'm very proud of that because it shows the faith they had. But I also paid for our first legal opinion. I wanted to make sure that what we were doing wasn't considered gambling because I wanted to be able, because I don't believe it is. But I'm not a legal expert so I went to the biggest law firm in the UK to get that signed off because it's an important part of what we're doing, and I funded that myself. And that's not a small amount of money so I accept that, but at the time that was it.

In terms of the operation of the business I couldn't afford to fund that. I only had so much money so I had to start raising straight away. My first round was a pre-seed where we raised a half a million bucks. Now, that was not easy and I have learned a really serious lesson in there which I'm happy to share. So day one I've already got connections in the industry because I went on the accelerator, I've got some cool connections there because I know some cool people. The first thing I do on day one is I go out and I try to get myself some big name investors. So I pushed myself out, I pitched them and I'll be honest there's no easy way to say this but I messed it out. Because I'm good at pitching, but I didn't know what they wanted to hear. Rather than not know, I didn't know how to articulate the value of what I was doing in a way that mean that they were going to invest. So I go into conversations with conservative numbers. They don't want to hear conservative numbers, they want to hear you're going to be a unicorn. They want anything sensational, but they don't want to hear that. I was going in there and I was like, "No, I don't need this, I don't need that," and they're like, "Well no, we want you to need this and that because we want you to be dependent on us for money."

[35:10]

James McKinney: Yes, yes.

[35:11]

Tom Fairey: Don't tell me you're going to be profitable after six months, it means you're not spending enough. All these silly mistakes that I made because I didn't know, and I failed with some really amazing potential VC's for us, and I moved too soon. But I needed money and I went to VC's when I really should have gone to Angels and I learned that lesson. I remember this so vividly, I was walking along Oxford Street in London and I just got out of my gym, and I was walking to go back to where I had a cowork. On the space of the journey, and James this is about 25 minute walk, I received three rejections from payment providers who said, "We can't work with you because we think you're gambling." Ironically one of them now works for us, and I got two rejections from some investors on the same journey. As you know, as a coffee connoisseur, you know how much and you can tell how emotional I was, I went into Starbucks for coffee.

[36:04]

James McKinney: Oh, you were in a dark place my friend.

[36:07]

Tom Fairey: I was in a dark place, so I went into Starbucks. And I genuinely, I sat down at the table there and I was like I can't go back to the office because I don't think we're going to make it. I think we're done. Maybe this isn't what it needs to be. And it was really hard. I think I messaged a friend of mine and I said to her, "Look, this is probably not going to work out." She said, "Come meet me for coffee. You're just getting your pitch wrong. Come practice your pitch with me, yeah?" So I went for a coffee and this is a true story. I went to have a coffee with her in Belsize Park in London, near where I live in Hampstead, and I'm pitching to her and her husband in the coffee shop. And this guy called Scott walks past and gives me his card and says, "Hey look, do you mind if I give you my card because I really like what you're doing and I think I'd like to invest."

[36:50]

James McKinney: That's awesome.

[36:51]

Tom Fairey: That's real, that's real. Now he didn't actually invest, his colleague Steve did, his boss. First ever money that we took for the business came from someone overhearing me at a coffee shop. We get our money in, it wasn't a lot, it was enough to give us a little bit of a stay. Then I realized at that point when I met that guy, these are the people that I should be selling to.

[37:14]

James McKinney: Real quick when you say "these are the people" I'm really big on words, and so I don't want to skip over "these are the people". Define "these."

[37:22]

Tom Fairey: Yeah, so what I was doing, I was selling to VC's too early. I didn't have enough. People talk about VC's, the reality of it is when they say they're risk takers, they're not really risk takers. What they are is they find a model that they like the fit of and they follow that model. I like to invest in these types of businesses, these types of people, and the reality of it is you find the number of first time founders that are invested in by VC's, it's… that's the reality. And I was really a first time founder and I wasn't the right fit at that stage. It was too risky and so, and I get that, but now I am VC backed but we'll come to that later. So all I did was no, I need to find angel investors.

I'm an angel investor now. I would say angel investing is just a very tax efficient way of losing your money, because we're there to take risks because we know the risks. We know that money is probably going to disappear, but if it doesn't we do incredibly well out of it. This is who I should be selling to because I'm at that stage. I'm at angel stage, but no one educated me about this stage that it was. That's the people I wanted to find. So what I did was I said right, here's my guy. Here's my guy Steve. Steve, investment banker, here's his age bracket. So I went out and I was like okay, right. I've got a guy who used to create lists for me. I said, "Nas, go and build me a list of these types of people from LinkedIn and get me their email address." I got the list, I put it together, I wrote a cold email, I used GMass - I highly recommend it to anyone- and I sent an email out to 1,000 people.

[38:54]

James McKinney: You sent a cold email out to 1,000 people and that became your angel round?

[38:58]

Tom Fairey: No, my major round was £500,000, £400,000 of it came from that email.

[39:06]

James McKinney: Oh my, well so obviously you know something about a cold pitch. In my head, I'm believing you because I do believe you, but at the same time there's a part of me that's like cold emails for investment? Yeah, cold emails for a lot of other things, I just can't wrap my head around it for investment. I think there's probably a lot of other people that are pausing as well thinking there's no way that works. You're proof of it. Can you unpack this cold pitch?

[39:33]

Tom Fairey: I will read you the email if you like.

[39:35]

James McKinney: That would be incredibly. If you could read the email and then kind of talk us through, for everyone listening, considerations for successful cold email.

[39:43]

Tom Fairey: If you want to raise money, or basically generating a cold email the rule is really simple. It is absolutely fine to send a cold email to someone provided what you're saying is interesting. It's as simple as that. If someone sends you something and they say, "Tom, look I think I can reduce your payment fees by 3%," I'm like all right, I'll listen to you. If someone says to me, "Tom, I can do app development for you in X country," I'm like oh God, not another one. Do you know what I mean? "Tom I can rebuild your website." Yeah, all right. You've got to make it interesting, you've got to make it relevant. So that comes down to targeting. Make sure you're sending it to the right people, and make sure it's interesting.

There's a three step rule that I always say to people whenever they are writing the email. Number 1, make it interesting. Number 2, make it credible. Show that you are worth listening to. Add some credibility in there. "We've already worked with X company." Or, "I worked at X company before." Or, "Here's an interesting piece of information for you." That's credibility. And third, you've got to make the call to action very clear. You are not selling in that email. You are selling a conversation in that email. Don't say to me, "Would you like to invest?" in that email, say, "Would you like a conversation?" Well saying that we did actually get 25,000 bucks off the email alone, but okay. So let me read you the exact email that I sent out that raised me that much money:

"Hey, so-and-so. I'll be brief. I'm the founder of X. We enable X to do X and we're seeing solid early traction. I previously worked for X and my cofounder was X at X and Y. We launched our product last month and we already have X many downloads. We've raised so much so far, and I'm reaching out to you as a potential investor because of this, this, and this. The funds are being used to further develop product and for customer acquisition. I've attached my deck for your review. It would be great to have a hangout or discussion to talk about this further if it's of interest. All the best, Tom."

That's it.

[41:37]

James McKinney: And that was the formula you used to raise close to $400,000 of your $500,000 round.

[41;43]

Tom Fairey: That is correct. £500,000, so like $650,000.

[41:46]

James McKinney: Yeah. Unbelievable. And now from that though, what was the time span if you could remember from sending email to closing out that 400,000? How long was that process?

[41:58]

Tom Fairey: So the article I just read to you, I wrote that article when I raised £250,000, but then the money kept coming in. so total it took me nine months to raise £500,000 and we did a rolling round. We did it on notes and I think you call it SAFE in the US, we called it an ASA here.

[42:19]

James McKinney: Oh, that's incredible. I absolutely love that. So it took you nine months to close your half million. Was there a follow on round for anything?

[42:27]

Tom Fairey: Because we were doing a rolling round, we're going along, trickling along, with that money just to keep us alive. We get to the point where we would say that we wanted to raise that money to get us to the point where the product was really out the, by the MVP. We had enough traction to say yeah here's some really early signs of product market fit and then we'd do a venture round. Now, throughout that process, plug here I run a podcast in the UK called the Back Stuff Show where I interview VCs and founders about practical tips, and I've met a lot of VCs along the way, and I'd also met with some VCs as I've been introduced by some other angels. Because what happens is when you bring on angels, and by the way my top fundraising hack for anyone raising money is find a super angel. Okay, and a super angel is someone who will connect you with other people. I have two and they're both former MD's of textiles and the value those people bring is insane because they know everyone, they've seen everything, they connect you with the right people. And it means your next round is super easy. So I spent nine months raising a half million pounds, nine months. You won't believe this but it took me two weeks to raise two million.

[43:35]

James McKinney: Oh my goodness. Were these super angels part of your initial round and therefore that second round became easier?

[43:42]

Tom Fairey: No, they weren't. They were completely use. What I did was there's a book by Robert Cialdini, it's called The Six Principles of Persuasion, and one of the key reasons that most fail to do things is obviously scarcity is a big part of it. I spoke to these people and I was like look, I don't want to keep raising money, it's taken too long. It's the end of the summer, I want the money in. so I spoke to everyone, like, "All right guys. I'm running around. It's three weeks. Here's my traction." Our traction was good. They're like, "Oh God." But I did that because I knew that I had one offer that was coming in. I knew that it was coming so I phoned up the company, I said, "I spoke to you earlier on. You said you wanted to be involved when I was a little bit further. I tell you what," and ironically we didn't end up taking their money, I said to them, "Look, do you want to be involved in this round? If you do, get me a term sheet. You've got three weeks." That term sheet came in, I just started running around all the VCs being like, "Check this out. Yep." And I remember specifically where I was. I was in my camper van, driving across Scotland through a place called Glencoe which basically looks like something out of Lord of the Rings, and I'm on the phone to this fund. I've got them all up there because I'm tethering in the back of my camper, and I say to them, "look guys," they're Russian, they're like, "Wanted to go to, we need to talk about it." I said, "Guys, if you need to go away and talk about it we probably don't have a deal because you've got until about 6 o'clock tonight because otherwise I'm going to accept this other offer." They came back at 5:30 and we cut a deal. It was great.

[45:07]

James McKinney: That's awesome.

[45:08]

Tom Fairey: You've got to bear in mind that, I think this is so interesting actually, everyone wants to live their life like they're in a movie so you've got to create an opportunity for them to do it. Everyone loves moving fast, everyone likes feeling like they've got that Hollywood moment. At the same time I know my fund, they talk about that story as much as I do. They're like, "Yeah, we closed it in two weeks." They love it. They want to be part of it. They have the due diligence to a long time, but the process of meet me, meet me again, meet me again, let's cut a deal was fast enough. And that's what people want. No one wants to sit around waiting. So if your VC says to you, "Look, it's going to take this much time to do it," say okay fine, you might miss out on this one.

[45:47]

James McKinney: I absolutely love that, especially from a sales strategy perspective. Because again you're great at sales. The best sales person is the one that is willing to walk from the deal. There's no posture of desperation that comes from it. You had a deal that you were ready to take anyways. It's such a healthy place to start negotiating from, so I love that you were able to do that.

[46:08]

Tom Fairey: I think a big thing I learned, a valuable lesson from a guy named Eamonn Carey who he's the MD of Textiles in the UK and he runs the fund in the UK, and he said, "tom look, make yourself someone that someone wants to work with. They want to be part of something cool. It's not just about…" You think about how many fintechs or how many CTOs go into, or technical founders, go in to meetings and they're like, "We have a great deal." Oh God, I've heard the same thing, same guy every time. Every time you go in there, they hear the same things all the time. I want people to enjoy working with me. So the first thing I say to people when I pitch, I'm like, "What are you better than me at sport wise?" And they'll be like, "What?" And I'm like, "What are you better at? Because that's what my app is all about, so if you're going to join I need to know that I'm going to fight you."

[46:55]

James McKinney: That's awesome.

[46:56]

Tom Fairey: And they remember that, so everyone has got a way of differentiating themselves. Don't be the other person that was involved. Don't be the vanilla flavor in that day. Be the one that they remember.

[47:06]

James McKinney: Yeah. Well we had Marco Zappacosta, the founder of Thumbtack. They've had seven rounds of funding and over $4 million, and one of the things he talks about in his episode is fundraising is storytelling. Everyone focuses so much on the data points, and the data points will come at some point when they're really interested, but it starts with the storytelling. They've got to place themselves within the problem you're trying to solve. That's incredible, and what you said is just that, what sport are you better than me at. You're placing them into the problem you're trying to solve. I absolutely love it. So when did you close that £2 million? Let's put a date stamp on that.

[47:42]

Tom Fairey: November.

[47:43]

James McKinney: November, so it has been two or three months up to that point. Where is the product right now? Is it in market?

[47:50]

Tom Fairey: Right, so we're in the market, we're out there, we're doing great. We've got great traction, we've got like 20,000 active users which is amazing. We're doing really well. Our users are vehemently passionate about what we do and they love it, and they help us. We're launching but we're still at MVP. We're still there and really simply people will say to me, it's quite an interesting story because people will say, "What's that money for? What are you doing with that money?" We're in a new market, and I said look, that money takes me to being number one globally. That's what it does, makes me number one. And I'm going to be number one by about May in terms of traction. That's where that money was going to take me. So we're MVP but our version one goes live on February the 17th, that's our version one. New face, new features, new cool stuff but the concept is the same. We're growing at a crazy rate. We stopped… it's so funny, when that money comes in let me tell you this. November 1st I have nine employees. December 1st I have 22.

[48:52]

James McKinney: Wow. Oh my goodness.

[48:55]

Tom Fairey: Well I'll tell you what I did, I started hiring them before I had the money because I was like I'm getting this money, I can't afford to cover it if I don't, but yeah I know I'm getting this, I'm closing this deal. So I started hiring because the last thing you want to do is be in a situation where you get the money and then it takes you three months to get talent. It's a long time to hire people, and so we planned ahead and we got there, and we just gave people conditional offers.

[49:22]

James McKinney: It's interesting the place you're in, the idea of being number one in May. You have 20,000 active users now. From the outside in I'm looking at like okay, who is his persona? His persona are obviously people who are gamers, they're video game people, but not all video game people are willing to put money on the line for their video game. How do you identify your persona and then how big is that space? Because gaming is massive. We can all agree gaming is just a huge sector to serve. But your, and correct me if I'm wrong, your persona is not just the gamer. There's a niche inside of the gaming community that is your persona. Is that correct?

[50:00]

Tom Fairey: Yeah, yeah, yeah.

[50:03]

James McKinney: So knowing that your persona is a niche of a larger segment, how critical was that for you to be crystal clear on in order to see the growth that you're seeing?

[50:14]

Tom Fairey: A problem I see a lot of starts make, and we made it as well as the beginning, is misunderstanding what you actually give to your customer. So let me explain that to you. You're giving your customer an emotion, a lot of the time if you're B2C. So I use Zero, the fasting product. I love it, it helps track my fast. What they're selling me there actually is I guess it's kind of hope, it's hope that I'm going to be in better shape, hope that I'm going to improve my longevity. Hope, that's what they sell. They tell you about it all the time, they tell you about it all the time. They tell you this is what's going to happen, this is where you're going to get to and that's great selling. They get my personality. Whereas you might think that because it's a healthcare app you're selling to gym bunnies or whatever. That's the mistake they would make if they were trying to sell to the wrong people.

And I remember when we were at Quantexa, a mistake we made was that we were trying to sell to people who were trying to fix the problem. Actually that's the wrong person because they don't like you. Don't come in here and tell me how to do my job. Sell to the person above them who has to pay for them to fix the problem, and then you show them, "Oh, you're going to save some money." That's basic sales 101, so what we've done is we've been on a journey where we just ask people all the time. The best hack you can ever have as a startup or any business ever, talk to your customers.

[51:40]

James McKinney: Yes, yes.

[51:41]

Tom Fairey: But don't go into that discussion with a hypothesis. That's the mistake that people make.

[51:46]

James McKinney: Interesting.

[51:47]

Tom Fairey: Yeah, they go in and think, "I think they're going to say this." Don't do that. Wipe their slate clean. Go in there and just listen to them. Let them talk. Let them tell you what the problem is. Let them tell you why they like your product. Don't say, "Oh do you like this? Do you like that?" Just let them talk, and if you give people the opportunity to talk you learn so much more. And we stumbled across something which is why we think we're growing faster than everyone else, and I don't want to tell you what it is because I don't want those competitors to know it-

[52:10]

James McKinney: I understand.

[52:11]

Tom Fairey: Yeah, they'll come round my house and talk to me. But the reality of it is I think like we figured out that actually what we're selling here isn't what people think we're selling. And it's revolutionized our business. Everything we do revolves around that, but you only learn that from speaking to your customers and not only that, but letting them talk.

[52:29]

James McKinney: I love it.

[52:30]

Tom Fairey: Anyone can lead them down a path.

[52:32]

James McKinney: I love it, absolutely love it. So we talk about being number one by May, if we were having a "Where are they now" episode in let's say three years, where do you see Stakester three years from now? What does the roadmap look like?

[52:44]

Tom Fairey: People talk all the time about exit, okay. I think exit is a really bad attitude to have. Don't build something with the intention of getting rid of it. Build something that you love and then people will want it. Same with houses. I buy a house, I live in the house, I make it a house that I love and I want to live in, and then when people come to see it they're like, "I want to live in this house," because you created something that people are going to love. And if you love it, someone else is probably going to love it as well. So what my ambition is to make the business that all of my customers love using, my employees love working there. And if my investors love the growth, that's great. But principally that's what you want to make it somewhere where everyone loves working, and they are going to give you their best version of themselves and give you the best output. Make it a product that you customers love and they're going to keep coming back and spending more money. Don't just keep thinking about the alpha, don't keep thinking about how I'm going to sell this to how I make this marketable. That's in your mind, it could happen, it'd be great if it did. But I can tell you now I'll be much happier having a business where I go every day and I love everyone I work with, I love what I do, I love my customers, my customers love me much more than I'm going to enjoy getting a big check. Because all I'm going to do with that big check is just do it again.

[53:52]

James McKinney: Yeah, absolutely. Oh, that's so rich, I absolutely love it. You know I want to honor your time, I want to honor the time of my listeners. This has been an amazing conversation. I feel like we could continue to just go an unpack some of the learnings that you've had, but you've given us so much value in this episode and I'm so thankful for it. But there are three questions that I ask every founder as we wrap up, and I know our audience looks forward to it because I get the feedback all the time. And that first one is just really about your perspective about entrepreneurship. There's this idea that entrepreneurship is like a Field of Dreams model, you build it and they will come, like it really is just a matter of hey have an idea, do a little bit of execution, raise some money, and keep going. There's so much about entrepreneurship that's not spoken about as far as the mental makeup, the resilience that we speak of. Do you think anybody can be an entrepreneur or is it something that you are born with?

[54:39]

Tom Fairey: I say there's a really simple test to whether you're an entrepreneur or not. When things are going tough in anything, whether it's a sport, when you're running and your tired do you stop? If you are at home and you are trying to tidy up your house are you like oh I'll do this later? Do you press snooze on your phone in the morning? Yep. If you're that person, if something gets tough, that's absolutely fine, don't become an entrepreneur. An entrepreneur is someone who when things suck and they really hurt, they're like, "Yeah, this is fuel for me. This is what I want." I say this all the time, I love it when we hit a hurdle because someone else quit. The best entrepreneurs are the ones they just don't give up. So that's what I truly believe, and that's the test. So think to yourself when it's cold outside do I decide not to go to the coffee shop.

[55;32]

James McKinney: Oh, I love it. Let me ask this question though, very specifically for you, when you look back on those hurdles that you're grateful for, you're thankful for, what is the singular hardest chapter of your life that you're so thankful for now?

[55:45]

Tom Fairey: In business or life?

[55:46]

James McKinney: Either. They both shape us.

[55:48]

Tom Fairey: I'm not naturally good at anything, okay? Nothing. Every time I've done anything for the first time I've been rubbish and I know that, and I'm accepting of that. I have no natural talent in anything. And what that has given me is a necessity to work if I want to be more than just what God gave me. If I want to be able to move up and become how I can I'm very lucky that I am rubbish at everything naturally because it means that I work hard and I build an ethic which allows me to become better. So every time I start anything new, and I am rubbish at everything, that's a real blessing. So to all those people out there who don't feel like they're talented, don't feel like they've got good genes, I don't have any of those things. I have to work at everything and I'm doing all right.

[56:38]

James McKinney: Oh, I love that perspective. That's so good. And that leads me to my next question that I ask every founder, it's about gratitude. Again, there's this idea with entrepreneurship that it's much about you just crashing on a friend's couch in front of a laptop bringing product to market. It's an isolated journey, just a Lone Ranger type adventure that we go on, and it's not true. There might be those stories of success along that route, but they're an anomaly and not the norm. so when you look back on your entrepreneurial journey, your entire life, who are the people that you point to with such immense gratitude for their contribution to where you are today?

[57:14]

Tom Fairey: First of all I hate the phrase when anyone says to you "self made" I'm like shut up.

[57:20]

James McKinney: Yeah, absolutely.

[57:21]

Tom Fairey: First of all, I'm a man of faith. God gave it to me first, but also I'm not self made, how disrespectful is that to my parents? They didn't give me money but they raised me obviously. Anyone who says they're self made that's not true. Your support network is the most important thing you have when you're a founder. To the mother of my kids, she looks after my children for me when I'm not there. To my friends who tease me and say that I'm an idiot. To my mates in the gym who let me spar with them to get rid of my stress. To my network, those are the things outside of work that you need that release, people who just don't… my parents couldn't care less. My mum doesn't even know what I do. If I asked mum what was the name of my company, she'd be like, "What?" It's brilliant, but that gives you reality, it gives you check, it gives you escapism. Then you have the network of people. There is the thing about startups which you will never understand until you're in it is how helpful everyone is. People like yourself creating amazing content for people so that they can learn all the time. Every one of your episodes has some great learnings which can make people better. People are like every investor that you work with, they may not give you money but they might give you wisdom. Ask people for help and people will help you, and vice versa. By the way, to all the startup founders out there don't be the guy that won't help other people out.

[58:40]

James McKinney: Yes. Yes. Oh my goodness. If there was any bumper sticker I could have for entrepreneurship, don't be that guy. Don't be that guy. Give back always. Because again, and even no matter what stage you're in in entrepreneurship, you have learned something that someone else needs to learn, and you can accelerate that by just sharing your knowledge. Oh, that was so good. Lastly as our time comes to an end, I'm so thankful that you afforded me the extra minutes as our time recording, but I would love to provide an opportunity for all of my listeners to have these one on one conversations with my founders, but it's just not doable. So what I like to do is I like to afford this mentoring minute, where it's just you and one of my listeners. Maybe it's the entrepreneur that is just frustrated with the lack of traction. They've been at this and they just continue to grind and grind and grind, and that not seeing anything cracked where there's scaling or massive success that they hoped for. Or maybe it's the wantrepreneur who has a 9 to 5 and a book full of dreams and ideas, and there's some narrative whether it's because they think they're told, because most entrepreneurs tend to be younger. Maybe it's the mortgage and the family burden, or whatever the case may be. There's something as to why they don't move forward. Or maybe it's the entrepreneur that got kicked in the gut because of COVID, lost everything, and isn't quite sure they want to go through it again. If you were having coffee with one of those personas, one of my listeners in those categories, what would you say to that one person?

[60:03]

Tom Fairey: If you are in a situation where you don't think you can afford to start a company because the risk is too great, just do something. Whether that be write a mission statement, whether that be draw a product plan, whether that be just go and speak to someone about your idea. Because as long as you're doing something you're moving it forward. And then do something else. And then do something else. And before you know it you've got something. Sooner or later, you will find a way to monetize it and then you'll be able to make that jump. The worst thing you can do is do nothing.

[60:37]

James McKinney: Once you've had a few moments to process all the value that Tom Fairey brought us in this week's episode please hit me up on LinkedIn, Facebook, or Instagram and share with me your thoughts on that is episode. Lastly if you've been around The Startup Story for any length of time then you know how much emphasis I put on the idea that entrepreneurs support other entrepreneurs, and Tom is a master connector and would love to connect with each of you on LinkedIn, so just search for Thomas Fairey on LinkedIn and reach out to him. We'll always include a link in the who notes. But another great way to connect with him is to queue up his podcast, the Back Yourself show, and subscribe on your favorite podcast platform. And much like his profile LinkedIn, we'll include a link to the show in our show notes as well for easy access. I say it in every episode because I believe it with my very being, entrepreneurs support other entrepreneurs, so let's show up for Tom Fairey in a huge way as a way of saying thank you for all the value he delivered to us today. And now for my personal ask.

The Startup Story community has been so incredible about sharing our podcast with others, but we have more stories to tell and more people to reach. We too are a startup and word of mouth is everything, so please follow us on Facebook and Instagram @TheStartupStory or on Twitter @StartupStory_. If you're on LinkedIn, please search for The Startup Story and follow our company page. LinkedIn is a really powerful way to raise awareness of the show. But the most impactful way you can help us grow our audience is to leave a review on Apple Podcast. Or if you listen to the show via Spotify, then please simply share the podcast directly from your Spotify app or wherever you listen to the show.

These simple actions can make a huge impact in getting these amazing founder stories out to the masses. And please make sure to tag or mention The Startup Story when you do share so that we can connect with you and say thank you directly. I'm so incredibly appreciative of the fact that you listen to the show each and every week, and I look forward to sharing these amazing stories with you every Tuesday with hopes of encouraging and inspiring you to start your story.

If you like this podcast and are thinking of creating your own, consider talking to my producer Danny Ozment. He helps thought leaders, influencers, executives, and authors create, launch, and produce podcasts that grow their business and make a real impact in this world. You can contact him today at emeraldcitypro.com/startupstory.

Listen Now

February 09 2021
Tom Fairey, founder of Stakester

More Startup Stories

All Startup Stories