Interview with an Anonymous Technology Billionaire

“When you think about your strategy, always think about headwinds and tailwinds.”

We recently featured a billionaire on stage at our events who would prefer to not have his name shared through, but we would like to share his insights and expertise here for your benefit.

The following has been anonymized to protect his identity but still I believe is helpful for others to review and study.

If you would like to hear directly from sharks from Shark Tank, family offices and billionaires on stage, please explore coming to our in-person events, as many times these speakers hang out for a half or full day and network through the event.

We hope you enjoy this interview.

Richard C. Wilson: What was the major turning point, point of increased momentum, or strategic choke point that once you acquired or completed made everything you were doing surge forward? 

Anonymous Billionaire: Before I answer that question, I’ll give you kind of an off-the-record story of what we did over the last 25 years. I’ve started tech companies since the early 2000s or so. I started my career first at an investment bank, which is no longer around. And when I was there, this is when Jeff Bezos was coming through the door and Mark Cuban and Meg Whitman from eBay, and I was just completely wide-eyed, just looking up to them, hiring this investment bank to take their company’s public and just completely got bit by the buck. A few friends that I met there, as well as some people we recruited from the Bay Area and Chicago, started a company called (Company) that was involved in contextual advertising, as (Interviewer) mentioned. 

What’s not on that bio is that our biggest competitor, Applied Semantics, was bought by Google. They had 50 PhDs on staff. We had 3. They raised $200M. We raised $50M. To give myself some psychological torture every now and then, I kind of think about what could have been. We did exit that company. It wasn’t a home run by any means. And after we got back up and brushed ourselves off, we decided to start a venture studio.

A venture studio is basically a fancy way of saying a company that starts other companies. And we didn’t quite know what we were doing back then, but Steve Jobs had given this very famous commencement speech where he said, “You can only connect the dots in your life looking backward.”

And we didn’t realize what we were doing at the time, but what it was essentially spending time with friends and family, asking a lot of questions, listening, and trying to identify what they were passionate about, and what were some of the frictions that prevented them from living those passions more fully. And how could we create, in other cases, apply technology to remove those roadblocks so they can essentially live their lives better?

We started in these very big markets. Children’s education, sports, and of course music, which I’ll talk about. In children’s education, there’s a company called Begin Learning, which is focused on kids 10 and younger around STEM, reading, literacy, world cultures, health, and things of that nature. It’s backed by Lego and Sesame, and kind of spun out of our studio.

There’s another company called League Apps, which is in sports and works with all adult and youth recreational sports leagues, about 3,000 leagues across the country. About five million players go through that platform. It’s backed by Major League Baseball, Elysian Park, which is an affiliate of the Dodgers, Harris Blitzer, which is Josh Harris’ family office, as well as Contra Ventures, an early-stage VC in New York City.

The company that I got pulled into was (Company), and I describe it as a technology company that is in the business of music streaming. For everyone in the room to kind of make it easier to understand, think of Spotify or Apple Music, but for the Indian market. I’m proud of the many accomplishments that the company has made over the years. We won the hearts of about a hundred million users and assembled a really great team from Silicon Valley in New York and India. But there are many different inflection points throughout that journey, and I’ll share two really quickly. 

One was with our product. The last time I actually coded in software was at the University of Virginia in an undergraduate class. But I realized I wasn’t really good at it, so my mission had to be to find other people who could go and do that. We started to assemble our team and to go direct to consumer back in 2006 – 2007, you didn’t have a lot of infrastructure that you have today to go and build.

In order to go and serve this consumer, we said, “Okay, we’re serving mostly people in India. There are all these companies that you hear about outsourcing, so why don’t we hire an outsource shop?” The worst mistake that we could have made. India back then wasn’t what India is today, and the talent actually wasn’t there. It was mostly focused on tech work as it related to back offices. And so, the first attempt at a consumer product was a complete failure.

The second attempt that we made is that we’re in New York City. There’s a lot of talent at Goldman Sachs and Morgan Stanley building high-frequency trading systems. And so, we recruited a great set of engineers who are very good at that.

So, we had a great product that actually streamed but when it came to user experience it took you ten clicks to be able to find the song that you’re looking for and to be able to stream it. So that was the second failure. And it wasn’t until we met a group of people out in Silicon Valley who were all working at Netflix and at Amazon and Yahoo and different places that were building a streaming service kind of in their free time that we were able to engineer a cash and stock deal to essentially acquire that team that already through their work organically signaled to us that they were interested in this market.

They became part of our company, and we essentially were able to build that consumer product that we had dreamed about for years. It was kind of a very painful last but a great one of just making sure you’re able to work with people that are actually aligned with what you want to create and put out in the world to make people’s lives better. 

Richard C. Wilson: What is the most valuable strategy, worth more than a billion dollars, that somebody had shared with you early on and which you would like to share today with everyone? 

Anonymous Billionaire: One of our board members was from Liberty Media. He had told us “When you think about your strategy, always think about headwinds and tailwinds.” Because you could be rowing in a boat and you can be working as hard as you can, but if you’re flowing against the current, it’s going to be really hard. So, figure out different trends that are in the marketplace that you can essentially ride.

And around 2010 or so, after we had built our consumer product. We had raised about $290 million in capital from (Companies) and a bunch of others which is another story that sounds really great on paper but the two-year journey to get there was very painful which I’m happy to share.

But when we talked to some of these investors, they said oh you got a great product but how are you going to scale how are you going to get to a massive amount of user base? And it was a great question. And it’s something we had not figured out. But just through networking and meeting people in Mountain View, we happened to find a team at Google on the business development team that was responsible for India. And India had an interesting problem in that there were tons of these pirate websites that were showing up in the search index. 

And Larry and Sergey at the time were like, there’s no way we’re removing any of these from the index because that is our mission. To organize the world’s information. And these pirate sites exist, and so they need to be part of the index. And the losses are coming to Google. The business development team is tasked to kind of go and figure this out. And so, we got in touch.

We have a conversation and they’re like, “Look, we want to make you guys the number one organic search result anytime somebody’s looking for music in India.” And we’re like, “That’s great. How much is going to cost us?” They’re like, “Nothing. Zero.” By putting a legitimate site ahead of all the other sites that come up organically in the index, they could signal to the industry that they were doing the right thing and trying to work with legitimate players.

In order to get that deal done, Google had to put on latex gloves and go through like all of our contracts. There are 900 contracts that we had signed with different record labels. They stress-tested our Consumer product platform to make sure that I could withstand the load. Before the launch of that, we had around 50,000 or so users. The second it went live, we got to 2 million almost overnight. And that was the final piece in the puzzle that we needed to go and raise our capital. 

The second we showed that to different investors, we got a term sheet the next morning, and it set off this domino effect of the next seven years of us raising almost $300 million of equity from VCs to get to that outcome that Ankita had mentioned.

Richard C. Wilson: What is the number one most costly mistake you have made, seen many investors make, or business owners make, which you think could be avoided?

Anonymous Billionaire: One of the mistakes that we made early on was just the idea of getting feedback and being open to that. It sounds so basic and retrospect, but we were just so single-minded in our focus and our vision of building this company that we didn’t want to hear any negative feedback at all. And when we had gone through and raised all this money from these institutional investors, we tried for two years, and it got 200 No’s. 

And we just kept pounding our head against the wall, trying to figure this out. Go to a pitch meeting. We essentially identified all the investors of Spotify, Netflix, and EA, anyone who had done something in media. In the tech world, we figured would be a great fit because we could be doing the exact same thing, but for a different market. And every single one of those investors told us no.

But it wasn’t until kind of the tail end of the process That we started to ask for feedback like what’s the why. Like it’s all right to say no but you got to give me a reason why this deal doesn’t make sense to you guys. And one of these investors kind of has to tell me “Look we think you guys are an amazing team you have this product that clearly works now and there’s certainly a big market, but we don’t know anything about India.”

And it was so simple now in retrospect but we pivoted our strategy to focus on investors that didn’t necessarily understand the media world or the tech world but knew the Indian market markets and after that happened, everything became a little bit smoother sailing for us but it’s kind of a painful lesson that seems obvious now in retrospect.

Richard C. Wilson: What strategies and best practices should philanthropic organizations adapt to attract tech-savvy donors and partners who can contribute not only financially but also with their technological expertise?

Anonymous Billionaire: The company that bought us is India’s largest publicly traded company. It’s called (company). They’re in oil and gas retail, the largest retail in the country. They’re in the media, they own 30+ TV channels, and they spent $25 billion to launch an all-IP 4G data network from the ground up. And when we had reached around about 30 million users, we started to get all the inbound interest from the usual players in Silicon Valley. We spent six months out in China, in Hangzhou with Alibaba, and in Hong Kong, in Shenzhen with Tencent. And these offers started to come in.

And it wasn’t until kind of the tail end of our process that we spent time with (Company) and we understood the whole vision behind this company, that they had just launched again back in 2017 or so. And the reason I’m bringing that up is that it’s a great example of how business can solve some of society’s toughest problems. And in India, the problem is that out of a population of about 1.4 billion people, there’s a hundred million people that are probably living a good life. Everybody else, 1.3 billion people, are just scraping by and the reason that Mukesh Ambani and the Ambani family wanted to launch (Company) is that Data in India at that time was the most expensive in the world on a per gigabyte basis. And their average income in the country is around $3,000. And the quality of service was absolutely terrible.

How can this country recognize its potential if you don’t have affordable data that’s available at scale? And what they said is, is that by having this data network available, and consumers essentially signing up, they get access to job opportunities, access to health care, access to resources for self-directed education, upscaling, and what have you. And the reason that they were interested in us is that music is kind of the common denominator of everybody in the country, right? 

Whether you’re a wealthy industrialist or you’re a subsistence farmer, it doesn’t matter. You’re going to understand if you have 80 million songs in the palm of your hand, you need to get a data plan to be able to go and do that. Demystified data from gigabytes and megabytes to something that everybody could essentially go and understand, and they did that at scale.

And I say that because I think coming from a tech-focused mindset to solve everyday problems is the same approach that a lot of nonprofits and philanthropies should take in order to address consumers at scale. Akshayapatra is an organization in India that feeds 2 million kids every single day. And to feed 2 million kids every single day in school, a hot meal, you can’t just throw a bunch of bodies at the problem. You have to create some kind of technology, a logistics network, and implement food science to be able to pull that off. 

And I’ve been to some of their kitchens before, I’ve seen gigantic machinery that they have custom-made in order to be able to cook these meals. I’ve seen the food scientists create incredible recipes. They have a logistics network and system over there where human hands actually never touch the food, there’s about 3,000 trucks that get these hot meals out to 22,000 schools across the country every single day. And it was a very entrepreneurial effort.

It was started by a group of 3 people about 23 years ago. They proved their concept first on a small scale and showed that they were actually able to go and address the need. They brought in government funds; they got the private sector involved. Aside from just individuals, they have big corporations like Google, and Caterpillar to help build some of the kitchens, Conagra to help with the food, and to really lend not just their money, but also their expertise and resources to be able to solve this problem at scale.

Richard C. Wilson: How can collaborations between philanthropic organizations and tech companies inspire others to harness technology for social impact and scale their philanthropic efforts? 

Anonymous Billionaire: I got involved with this organization because I happened to go to one of their events probably about 10 years ago. And I heard the then dean of Harvard Business School, a guy named Nitin Noria, speak. And he was sharing a story with me. His father grew up in India in the 1940s he was poor and he had a choice either to go to a school right next to the village that he grew up in that didn’t serve any meals or to walk two miles every single day to go to another public school that actually served a hot meal and he chose to go to that school walked two miles to and from every single day because it served a meal. 

And because of that, he stayed in school. Because of that, he got a college degree, and he became a very successful industrialist in India. So, Nitin Nohria grows up in Delhi, eventually goes to London, goes to MIT, gets a PhD, and then starts an academic career where his last role at Harvard was as the dean of the business school. It was a great example of how something so small compounds over time and has such a tremendous impact over generations because of the simple presence of a hot meal.