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Josh Smith of VRGL: Five Things You Need To Create A Highly Successful Startup

An Interview With Tyler Gallagher

There’s the saying that rich people are some of the unhappiest, and I would argue that’s one of the biggest reasons for it. It is critical to allot time to take care of your physical and mental health. You must build a team around what you need for your physical and mental health and what your family needs for physical and mental health.

Startups have such a glamorous reputation. Companies like Facebook, Instagram, Youtube, Uber, and Airbnb once started as scrappy startups with huge dreams and huge obstacles.

Yet we of course know that most startups don’t end up as success stories. What does a founder or a founding team need to know to create a highly successful startup?

In this series, called “Five Things You Need To Create A Highly Successful Startup” we are talking to experienced and successful founders and business leaders who can share stories from their experience about what it takes to create a highly successful startup.

I had the pleasure of interviewing VRGL CEO and Co-founder Josh Smith.

Josh Smith is Co-founder and CEO of VRGL. VRGL provides institutional-grade analytics and automated data extraction to empower wealth management firms to accelerate the Client Acquisition and Proposal Management process (“CAPM”). By giving clients a complete view of their consolidated investment picture, VRGL enables advisors to quickly demonstrate how and why they add value. Most recently, Josh co-founded and was CEO of Solovis, Inc., an industry pioneer in multi-asset class analytics for institutional investors.

Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

I have spent my entire career in wealth management and institutional investment management through varying career paths. I started as an investor initially, then moved into operations and technology for investment organizations and worked as a consultant. Ultimately my experience in the industry led me to start my previous software company, Solovis, in February 2013. I held the CEO position for seven years, culminating in an exit to NASDAQ in 2020.

After my time at Solovis, I was faced with the decision of what to do next and came to the realization that my passion was building solutions from scratch. One day I received a phone call that led to the eventual founding of VRGL. The opportunity to found VRGL as a solution for financial advisors used a similar construct as Solovis — taking an analytical approach to solving workflows through data extraction.

What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?

With my background in wealth management, I have dealt with the problem we are trying to solve from the prospect’s perspective. After selling my last business, I experienced firsthand the process of vetting and ultimately selecting which investment advisors to work with to manage my portfolio. I saw how different advisors approached me as a prospect for their services. It was a long and in-depth process before deciding on an advisor.

My experience in that process informed what VRGL is today — a client acquisition tool for financial advisors. VRGL offers the prospect the tools they need to choose the right financial advisor. From an advisor’s perspective, VRGL helps identify what prospects should be pursued as a client. My personal experience on the client-side and interacting with advisors was indeed the ‘aha’ moment that sparked what VRGL is today.

Was there somebody in your life who inspired or helped you to start your journey with your business? Can you share a story with us?

Several people and experiences throughout my life influenced the founding of VRGL. In my personal life, my father played a significant role. He was a serial entrepreneur himself, and although none of his companies became widely known, it played into my motivation to become an entrepreneur.

Additionally, I spent a lot of time in sports as a kid and as a captain of sports teams. This gave me experience in team leadership from a young age. Leading companies is a lot like being a captain of a sports team — the ability to build the team around you and lead toward mutual success for the team. Winning and celebrating team success is truly what drives me in my role today.

What do you think makes your company stand out? Can you share a story?

The team at VRGL is stellar. One of our first clients told us that we have an ‘ethos’ about us. We are not just here for our product. We are committed to providing optimal solutions and services for our clients. Our goal is to bring transparency, accountability, and accurate reporting for the financial advisor and the prospect. We are dedicated to giving our clients and their clients the tools they need to thrive and overcome challenges.

How have you used your success to bring goodness to the world?

I am passionate about building businesses and believe in using past lessons to avoid making the same mistake twice. As a mentor, I believe in sharing that knowledge with all who approach me for advice. I have the privilege of mentoring professionals across the board, from professional board arrangements to first-time entrepreneurs. It is a real privilege to share my experiences and give people an opportunity to learn from my mistakes so they can avoid them in their endeavors.

You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?

There are many more than just these three traits integral to my success, and no traits are required to achieve success. But I believe certain characteristics have led to my success, including:

Drive: You must make your path; no one will feed it to you, but some people will help you. You must have the drive and the willingness to push through the challenges and struggles. Sometimes this can mean working long hours or holidays, but true drive can set you apart.

Teamwork: Every successful founder has a great team behind them. An NBA champion will thank the great team around them. Establishing a great team is integral to success.

Willingness to learn from mistakes: It is essential to listen to every time you hear the word ‘no’ and why you received the ‘no.’ Then, learn from that example and create a roadmap that leads to a ‘yes’. Sometimes, hearing a ‘no’ will provide more value in the long term to your business than a ‘yes.’

Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?

Sometimes people advise me to stay calm and not go with my gut. Every time I listened to that advice (granted — I took the advice less than a handful of times), I made the wrong decision.

I am a firm believer in trusting your gut instinct. You must be true to yourself throughout your decision-making process, even in a business environment.

Can you tell us a story about the hard times that you faced when you first started your journey?

Starting a business is a journey, and success does not happen overnight. One of the many hardships companies may face is missing an opportunity. As a business leader, one of the hardest things I face is when employees disagree with business direction or choose to leave the company to pursue other opportunities. It is critical to reflect when these situations occur and take action to learn and do better in the future. Although you may not agree with everyone, and people may have different ideas, you must introspect and see where you can do better in the future.

Where did you get the drive to continue even though things were so hard? What strategies or techniques did you use to help overcome those challenges?

You may face times in your business journey where you continuously hear the word ‘no’. You may hear the word ‘no’ for many reasons. There are several reasons this could happen at the early stages of your business. Pricing, competitors, product maturity, etc. could all play a factor in hearing the dreadful word ‘no.’

Take the feedback you hear in these conversations and chart the roadmap that will lead you to an eventual ‘yes’. If you have a good idea, with positive financials and margins, you cannot let the ‘no’ discourage you on your road to success. If you listen to feedback, accept some failures, and make an active change you’ll set your business up for success.

The journey of an entrepreneur is never easy, and is filled with challenges, failures, setbacks, as well as joys, thrills and celebrations. Can you share a few ideas or stories from your experience about how to successfully ride the emotional highs & lows of being a founder”?

Try not to get too carried away in your role as a founder. I am fortunate to have a team around me who know me and understand how I work — some have been working with me for a decade.

It is critical to understand your pros and cons as a person. I know that once I master one thing, it is not enough, and I look for something else to master. Furthermore, I am highly technical and analytical. Most people do not think this way, and I know and understand that. My team understands that as well. You must have self-awareness in how you differ from the status quo.

Furthermore, you must learn how to roll with the punches and not let the highs and lows affect you too hard. As a founder, they become a fact of life. Being an entrepreneur is not easy. It’s certainly not guaranteed. But you will never learn faster than being an entrepreneur.

Let’s imagine that a young founder comes to you and asks for your advice about whether venture capital or bootstrapping is best for them? What would you advise them? Can you kindly share a few things a founder should look at to determine if fundraising or bootstrapping is the right choice?

There is no correct answer that is the same for everyone. For some businesses bootstrapping may work best, and for others, venture capital funding may present the best option, but there is undoubtedly no correct umbrella answer. When making a business decision, you should ask yourself several questions: What is the growth potential? How complex is the platform? Do you have the right product-to-market fit? How saturated is the market? What are the margin profiles?

Under our current market conditions and interest rates, much capital has dried up, and deals are down significantly from 2021, along with valuations. These current market conditions can also determine your response.

Another consideration is the amount of control you wish to have over your business. Once you accept money from outside investors, although you may control most shares or board seats, you no longer have autonomous control of business decisions. This is a crucial factor to consider for your business when determining direction.

Ok super. Here is the main question of our interview. Many startups are not successful, and some are very successful. From your experience or perspective, what are the main factors that distinguish successful startups from unsuccessful ones? What are your “Five Things You Need To Create A Highly Successful Startup”? If you can, please share a story or an example for each.

I think the best way to approach this is what differentiates a good idea in a highly successful startup and an unsuccessful startup.

Teams drive success. It does not matter how good your idea is. The team will ultimately determine the success of that idea. Businesses must be able to scale their team to ramp up onboarding from one to 10 to 20 to 500 clients a month. The founders alone likely will not be able to produce that level of scaling. You will need an entire team: heads of sales, heads of revenue, heads of client success, heads of technology, operating officers, CFOs, and you must be able to hire the right people. As the CEO, my job includes recruiting, raising capital, overall strategic oversight, operations, and sales. Although I may be able to take on these areas, I must also find people who are experts in these areas and help me scale my ideas.

In short, every successful startup must have a strong team, product market fit, an understanding of operating leverage, and the ability to raise capital and think outside of the box. Understanding the levers of the business and building the right team is genuinely the differentiator for success.

What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?

The biggest mistake is not understanding the financial levers of a business. You don’t have to be a chief financial officer or CFA. Still, you need to truly understand the cost drivers, revenue drivers, and pricing models, including the fixed and variable costs associated with that business. You also must know whether the idea can scale.

Many CEOs and founders have a false sense of control and a false sense that control is required. This can lead to an unwillingness to scale and bring in a team. Because of that, you end up in a situation where it may be a great idea led by an intelligent CEO but ultimately creates issues.

Startup founders often work extremely long hours and it’s easy to burn the candle at both ends. What would you recommend to founders about how to best take care of their physical and mental wellness when starting a company?

I have gone through this cycle several times in my 20s, 30s, and late 30s. It is very different this time than it was last time. I have experienced success. I built a business from the startup phase through the growth equity phase, and ultimately an established business phase, and exited to a public company. Now when I’m doing it all over again, my capacity to burn the candle at both ends is not what it once was. I do not have the same energy and have different priorities, including my kids and family. Having those priorities truly changes your life.

Once you have a family, they also become part of the process. You must have a conversation with your family about their role in your journey and what it will take. Furthermore, you must set and understand the boundaries for your family.

Becoming a founder will be more challenging than any other job. Becoming a founder requires physical and mental toughness. In the role, you experience accelerated learning. Many founders, myself included, love this component of the job. But you can’t look over your shoulder and leave your family and friends behind. You don’t want to look over your shoulder and only see a shell of what you once were. Even if you achieve success, you will never achieve happiness.

There’s the saying that rich people are some of the unhappiest, and I would argue that’s one of the biggest reasons for it. It is critical to allot time to take care of your physical and mental health. You must build a team around what you need for your physical and mental health and what your family needs for physical and mental health.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I believe that most people are willing to help in a business sense, whether it be clients or advisors. Build a network of people who you trust that you can turn to with your questions. During these interactions, be very reasonable with their time and be willing to give in return. I know too many people who want to get you on the phone and talk your ear off for 45 minutes about why their idea should be great. Often these people are not willing to reciprocate or offer you something. Unfortunately, that’s not how the world works. You must be thankful for people’s time and admit that you need help. Nobody is smart enough to do it themselves.

The second time I’m doing this is easier than the first time. That is because I am sure to implement the lessons from those around me the first time I was a founder. Be willing to ask for help, and you will be surprised at what the world offers.

We are blessed that some very prominent names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch, and why? He or she might just see this if we tag them.

For me, that person would be Warren Buffet. He has demonstrated unmatched consistency over numerous economic and business cycles. I would love to ask him questions about his mentality and how he thinks through things when people tell him he is wrong.

How can our readers further follow your work online?

You can learn more about VRGL here:

Personal LinkedIn:

VRGL’s LinkedIn:

This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!



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