Ben Milne (from left), Bo Fishback and moderator Jeff Slobotski live in Des Moines, Kansas City and Omaha, respectively.
The beauty of writing about a panel discussion between three people frequently featured on the very blog for which you’re writing — and a blog co-founded by one of those people — is that you can afford to forgo formal introductions and get right down to business.
And, given that this post is long overdue, that’s precisely what I intend to do.
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Earlier this month at South By Southwest Interactive in Austin, Texas, I attended “The Field of Dreams Manifesto,” a panel discussion featuring a couple familiar faces: Bo Fishback, the founder and CEO of Zaarly, and Ben Milne, the founder and CEO of Dwolla. The panel was moderated by an even more familiar face (in fact, it’s a face sitting across the desk from me right now): Jeff Slobotski, the co-founder and chief community builder of Silicon Prairie News.
Presumably, anyone who has paid a bit of attention to SPN over the last year-plus is familiar with Zaarly, the proximity-based, real-time, buyer-powered market that briefly made its headquarters in Kansas City, Mo. and still maintains a presence (including Fishback) there. Ditto Dwolla, the online payments platform that’s based in Des Moines. But the SXSW panel provided a look at the founders in a slightly different light than they’re usually seen on SPN and revealed some new insights regarding their companies.
Full audio of the panel is available courtesy of SXSW, and a handful of the more noteworthy nuggets I took from the talk are below.
Among the topics Fishback and Milne discussed: potential collaboration between their startups down the road.
Attracting talent
Milne said there’s unquestionably talent in the middle of the country for startups looking to build there. He cited Des Moines as a hotbed of banking and insurance talent, Kansas City as a rich source of front-end designers and Omaha as a place chock-full of payments-savvy people. “In terms of talent,” he said, “the talent’s absolutely there.”
Fishback agreed that talent can be found anywhere. In fact, Zaarly took what Fishback called a “geographically agnostic” approach to hiring when it launched, drawing people from places as scattered as Austin, Greenville, S.C., and Seattle. “We just started hiring the greatest people ever, and some of them ended up being in the Midwest,” he said.
“I didn’t really care where people are until we started getting big enough that communication was becoming a problem.”
Finding funders and advisors
Zaarly’s geographical agnosticism does not apply to the startup’s decisions regarding advisors and investors. Fishback said the location of those types of people was a driving force in Zaarly eventually relocating to San Francisco.
When it came time to find a board, Zaarly made a wish list. No. 1 on that list? Meg Whitman. And, as Fishback pointed out, “Meg Whitman only gets to live in one place.”
Whitman residing in San Francisco, combined with an abundance of what Fishback called “smart money” there, drove Zaarly to the West Coast. “The people that I wanted involved,” Fishback said, “were not in the city that I was living in at the time.”
Dwolla’s approach to fundraising was initially less calculated than Zaarly’s. But Milne said a willingness to travel to the Midwest has been a must for Dwolla’s funders up to this point. “If you don’t come to Iowa for board meetings, you really can’t invest in the company,” he said. “And maybe that’s a product of where we’re at with the company and where we’re at with the team.”
That said, Milne recognized that working with the coasts will be necessary to Dwolla’s continued growth. “You have to connect with the rest of the world,” he said, “but I see no reason why we can’t keep a really strong core (in Des Moines).”
Choosing a CEO
At one point, Milne turned to Fishback and inquired about the process that Fishback and his Zaarly co-founders, Ian Hunter and Eric Koester, used to determine who would become CEO. Deeming Fishback CEO, Hunter CTO and Koester CMO and determining the equity breakdown between the three took all of 20 seconds, Fishback said, “and we’ve never even talked about it once since.”
Fishback said he’s a big believer in Zaarly’s three-founder structure. “I actually really like three-person founding teams for that reason,” he said. “Outside guy, inside guy and tech guy — I think that balance is one that works.”
Unique growth
Both Dwolla and Zaarly had somewhat unconventional circumstances surrounding their initial growth.
Regulatory red tape left Dwolla little choice but to establish roots in Des Moines. “The reason we launched in Des Moines first is because it wasn’t legal for us to do business anywhere outside Iowa,” Milne said. “It was hustle in Des Moines or hustle nowhere.”
Meanwhile, Zaarly defied much of the conventional wisdom passed its way about how to roll out its marketplace. Fishback said the company heard “very, very strong opinions from super smart people” that suggested Zaarly shouldn’t be made widely available until it had conquered one city.
But Zaarly ignored that advice. And, in doing so, the company learned a valuable lesson about how to build pockets of passionate users. There’s a funny thing about 22-year-old kids straight out of college working for a startup, Fishback said: “They do not shut up about it.”
He recalls walking into bars and seeing 10 Zaarly employees, but none of them were interacting with each other. It wasn’t a sign of bad team chemistry, Fishback said, but a testament to the employees’ excitement about Zaarly. “That hustle and energy is … if you have that on what you’re working on, you just go with it,” he said. “I was not about to put a lid on it.”
Collaboration?
Zaarly’s a marketplace. Dwolla does payments. So, one audience member asked towards the end of the session, can we ever expect to see the two startups work together?
Fishback said there’s a high probability. “We’ve been talking about it for awhile,” he said. “There’s some cool magic to be done between Zaarly and Dwolla … I have no doubt about that.”
“I’d bet an enormous amount of money,” he continued, “that sometime in the next year there will be some cool stuff going on there.”
Credits: Photos by Danny Schreiber.
