So how do you start a startup? Here’s what I did…

Former CPA, background in corporate finance, zero startup experience — this was my resume when I started Tali, not exactly what you’d expect from a startup CEO, right? Turns out that doesn’t matter — to start a company, you don’t need to be a technical whiz-kid with tons of prior startup experience. Instead, I believe you only need 3 things — 1) a problem worth solving, 2) a strong team, and 3) a little bit of luck.

The idea for Tali — how it all started

My wife is an attorney and has been practicing law for the last eight years. She began her career in government, but has spent most of her time in private practice (civil litigation to be exact), tracking every tenth of an hour or 6 minute increment of her day to make sure she bills clients appropriately. Like many attorneys, she tracks her time using pen and paper, and will then regularly spend a few hours, typically at our kitchen table, manually filling out time entry forms in her firms billing system based on the time tracking data she has on paper.

To me, someone who doesn’t practice law, this seems like an incredibly painful process, but one that I just assumed was “part of the job.” Then, in late 2016, things changed when I was given my first Amazon Echo device as a gift.

We used our Echo for all the things you’d expect — mostly music, NPR and timers — and the device sat on our kitchen counter. One night my wife was sitting at our dining room table, going through her manual time entry ritual, and I was in the kitchen setting a timer with our Echo device. After doing so I randomly blurted out:

“Hey, wouldn’t it be cool if you could just tell Alexa to log your time, and she’d create a time entry for you?”

And with that, the idea for Tali was officially “born.”

Forming the team

While the idea for Tali may have been sparked in my dining room, it didn’t get its true start until one random afternoon a few weeks later. At the time, I was working in Strategic Finance at HealthSparq, a healthcare technology company in Portland, Oregon. It was here that I met two other guys named Matt — Matt Anthes-Washburn, or “AW”, was a product manager and Matt Hoiland, or “Hoi”, was a full stack dev.

During a hackathon at HealthSparq, Hoi and AW had created a chat bot named Charli that would answer all of your health insurance questions based on your specific member benefits (I know, pretty awesome, right?). The ease of the conversational user interface attracted me to this project, and it was our joint passion for conversational UI that initially brought us together.

As a non-technical person, I had no idea how any of this stuff worked. To be honest, I was pretty ignorant when it came to technology and just took for granted that stuff like my iPhone did what I needed it to do. But I wanted to learn more about how Charli worked, and also how something like this Alexa time tracking solution would work. So I asked them to meet up after work one day to, and I quote, “teach me how AI works” — such a simple request, right?

After we got together, Hoi and AW ran through some basics associated with AI in a way that a non-technical person like me could grasp. Then I told them about the problem my wife was having, and the proposed solution I had recommended. Before I even finished my sentence, Hoi was penciling stuff out on paper on how that could work, meanwhile AW was doing what AW ultimately does best — teaching me what Hoi was penciling out, how it would all work, and what it would mean for a potential user like my wife.

Within 30 minutes we had a proof of concept sketched out, and I was convinced that we had something special — not necessarily in the form of a product (although I certainly hoped that would be the case), but in the form of a team.

You had me, the business Matt.

You had AW, the product Matt.

And you had Hot, the technical Matt.

So the next weekend, over donuts and blueberry pancakes at AW’s house, we decided to make it official — we were going to start a company together.

Customer discovery: listen to as many prospective users as possible

We had an idea and a team, but we were still missing one critical thing — market feedback. Sure, my wife had told me timekeeping sucks, and using voice seemed like a good solution to that problem, but that’s still just one conversation. So after we formed the team, I did two things — 1) became obsessed with the problem of timekeeping and 2) talked to every lawyer, accountant, consultant and timekeeper I could about the pain of timekeeping, why they hated it, and how it could be better.

Throughout this customer discovery period, I learned two primary things: 1) people hate tracking their time (like really, really, really hate tracking their time), and 2) existing solutions are inadequate and do not solve their problems.

During this customer discovery process, I spoke with hundreds of people and a variety of timekeepers, but ended up mostly speaking with attorneys and lawyers. There seemed a be a real pain point within the legal industry around timekeeping (multiple people have told me that “tracking time is the bane of my existence”). When you couple that with the two things I mention above, it seemed like we had everything we needed to get started. We would build a voice-driven timekeeping solution for attorneys.

VC funding within 90 days…this fundraising thing isn’t so bad

Idea? ✔️ Team? ✔️ Product concept? ✔️ Funding? Nope.

One of the benefits (and pitfalls) I had as a first-time founder was naivety. Once you have an idea and a team, all you need is a pitch deck and you can go out and raise some money, right? That’s what I thought, and so that’s what I did.

Hoi (the technical Matt) is not only an all-around coding ninja, but he’s also a top-notch designer and creator. He shot a high level product demo and some other footage, which he edited into a professional looking 60 second video that I could share with investors (click here to see this original video). In addition, I prepared a 10 slide pitch deck outlining what we were trying build at Tali. With these two things, I started sending every early-stage VC a cold e-mail asking for a meeting. The response rate was, in one word… *sigh* underwhelming.

This isn’t surprising — I was a first time founder, we were pre-revenue and had nothing more than a product idea and a team that I *thought* could build it.

But then we experienced our first bit of good luck…I got a response from an early stage VC out of Los Angeles and we scheduled a phone call. I spoke to one partner for an hour, and he then referred me to his other partner, who I spoke with a few days later. Two phone calls with two people a few days apart.

I got a term sheet the next week.

They wired me $150k the following week.

All of this without ever meeting in person, just two phone calls…this fundraising thing isn’t so bad, egh?

Wrong. Wrong wrong wrong wrong. Turns out fundraising was a giant pain in the a$$, and I heard “no” more often than I heard “yes”. I’m not going to get into fundraising here, but we ultimately went on to raise ~$750k to fund the business, but this first check and investor is what made all of that possible.

Lesson #1 — Focus on the problem, not the solution

I get asked a lot “how did you come up with the idea for Tali?” or “how did you decide to start a company?” The first thing I always tell people is to start with the problem, not the solution. Sounds easy, right? In reality, not so much.

For example, at Tali we started with the problem of timekeeping, and wanted to understand why people hated it so much. Based on market feedback, we learned that people hated filling out time entry forms. We understood this problem, and then proposed a solution — what if you could log your time without time entry forms, by leveraging voice technology like Amazon Alexa?

Now contrast this with the alternative, of starting with the solution and then applying that to a problem. We could’ve said “hey, voice technology is awesome, let’s find a way to build a voice app for lawyers and law firms!” and then searched that particular landscape for a problem we thought could be solved with voice technology.

Start with the problem, then work toward the solution. Find where pain exists, and then use that pain to develop a solution that people can’t live without.

Lesson #2 — Find a team with complimentary skills

Myself and my co-founders clearly had a plenty in common — after all, we were three dudes with beards and were all named Matt. But from a talent perspective, we each had the skills necessary to run a business end to end.

You had Matt AW, a product manager who could focus on designing a product to solve the problems of our users. He could also do some development work, and ended up doing all the development for our voice applications.

Then you had Matt Hoiland, a full stack dev. He built out and designed the Tali web application and the Tali API, and built all of our necessary 3rd party integrations. In addition to engineering, he’s also talented with branding and design, so he built the Tali website and designed all of our marketing collateral and images.

Then there was me, the business guy. I had no idea how to code, but I could do sales, finance, partnerships, fundraising, and anything else non-technical (like janitorial, which I’m told I wasn’t all that good at either 🙁).

Between the three of us, we had someone that could design a product, someone that could build a product and someone that could sell that product. Wallah! And sure, while we all had complimentary skills, we each did understand a little bit about the others domain and took feedback from everyone very seriously. With overlap where we needed it but complimentary skills between the three of us, we had everything we needed to try to pull off something big.

Lesson #3 — You need a little bit of luck

No doubt about it, we got lucky in the early days of Tali. I believe the first area where we lucked out was the team — I knew AW and Hoi could build things and that I couldn’t. I also knew that I enjoyed working with them. It was these two things that drove me to start a company with them. Team dynamics can be tricky though, and startups often fail because of founder issues. I can gladly say that my co-founders and I have had a great relationship throughout our startup journey, and that our complimentary skill set has allowed us to keep the team small while still executing end to end.

The other, and more obvious, place where we got lucky was with our first investor. Why did they even open my e-mail in the first place? Since they invested, I know for a fact that they have more unread e-mails in their inbox than read e-mails, but for some reason they decided to open my message, and then respond. Were they looking for a voice solution to add to their portfolio? Or was it just right place, right time?

Who knows, and the truth is that it doesn’t matter. What matters is that you need a little bit of luck to get going, and we managed to find some. This isn’t something that you can force or something that you can plan for and then execute on. It’s something that can only come be existing, by being there.

Imagine if I would’ve said — “likelihood of me finding an investor through cold e-mail outreach is small, I’m not even going to try”. Without giving it a try, without testing to see if it was a viable option we would’ve never wound up in that VCs inbox and likely would not be a company today.

So how do you get lucky?

You need to put yourself in a situation to get lucky.

Have an idea for a product? Go tell somebody and see what they think.

Want to form a team and start a company? Go ask some people to see what they think.

Want to get a meeting with a VC? Send them an e-mail, tweet at them or send them a message on LinkedIn.

If you don’t ask, if you don’t try, you’ve got no shot at getting lucky.

So go ahead, put yourself out there and see what happens. I promise, you won’t regret it.