#375 - Jesse Tinsley - CEO @ Employer.com - Rescuing Bench, TikTok Purchase?, Battle Tested Acquisition Playbook

Chris Powers: Jesse, what's up, man? Thank you for joining me on the show today. 

Jesse Tinsley: Yeah. Thanks for having me. Excited to be here. 

Chris Powers: All right. We’ve got a lot to cover. You've got a lot going on. Before we talk about the TikTok purchase, I want to talk about Bench. So, when did you know that Bench was available? Like we're going to kind of tell the story through a timeline. 

Jesse Tinsley: Yeah. Bench is a weird one. I was on vacation, which is pretty rare. I was actually off the week before Christmas too. And then I was in Florida. And basically right after Christmas, it was like the weekend after Christmas, it was like, what was it? Friday night, I heard that Ian, founder, co-founder, the original CEO of Bench that posted that thing that he posted that went viral on VCs and whatnot. Nonetheless, so then I saw that, I went to sleep, and I woke up, and I was looking through social, and I saw Bench had shut down abruptly. And they obviously were one of the largest, the largest SMB accounting software company in the US. And so I immediately went online and looked for mutual contacts, reached out to the CHRO. Things took off pretty quickly from there. I’m happy to dive into the weeds. It was literally, I apparently learned after everyone else that Bench had shut down. So I was like one of the last people to know. 

Chris Powers: Okay. So, you're on vacation. So what day is this? Like a Thursday or Friday or earlier in the week? 

Jesse Tinsley: This was a Saturday, early Saturday afternoon when I first heard of Bench shutting down, and Bench had shut down the day before, on Friday, abruptly. 

Chris Powers: Okay. So you get in touch with the CRO and say, I would like to buy Bench, or what was the first conversation? 

Jesse Tinsley: You want me to pull it up that? I can go off camera for a second. I can tell you exactly what it says. 

Chris Powers: Sure. I think that's huge. 

Jesse Tinsley: All right. So I said, hey, so and so, sorry to hear about Bench. I was actually curious if you could connect me with the board, chairman, or CEO. The reason is I might be able to turn around the rest of the business in an acquisition. Let me know and have a great weekend. And that was at 1:01 PM Eastern on the 28th of December. So that is the context. 

Chris Powers: Okay. And so, you send that message at 1 and when do they reach back out? 

Jesse Tinsley: Within 45 minutes. 

Chris Powers: Okay. And said, here's the CEO. 

Jesse Tinsley: What's your email? Gave them my email. And then, yeah, we got NDA going pretty quick. 

Chris Powers: And at this point, did they have any other buyers even talking to them or were you kind of the first to show up, or I would imagine knowing they're going bankrupt, they had been talking to somebody? 

Jesse Tinsley: Yeah, I haven't dove into too much of the [inaudible] stuff, I think like, I know that they had been trying to sell and they did some other things. And I know because there's a lot of people really upset at me that we bought them, they were competitors, and I was like, dude, you're playing the wrong game. You guys are playing like a go-to-market game, where we're going out and buying businesses and passing you really quick. If I recall correctly, it was like 13 to 15 other buyers or something like that. 

Chris Powers: Okay, so they get back in 45 minutes, they put you in touch with the CEO. At what point did you make a deal, I guess? How long did it take to get to a deal? 

Jesse Tinsley: It wasn't the CEO, it was the board of directors. I actually didn't meet the CEO until much later. And yeah, so we started working on a deal. I had a bunch of shapes of deals, but we're dealing with different parties than normal, I'd say. So that was a very odd deal I'd say. It was an all cash deal too, for context. 

Chris Powers: What did they send you to do due diligence? Because for anybody listening up to this point, you closed this deal by Sunday night. So, 20, 36 hours later. So what did you have in front of you? What were they able to give you to make an offer, or did you even need anything? Was price your due diligence? 

Jesse Tinsley: What actually caught my eye and the reason this was actually really interesting, a week prior, we had already been looking at for our BMS solution that we offer, which is like managing large enterprise customers, like vendor managers for recruiting. And so, we were looking for finance and accounting software to basically API into that. So this fit really, really nicely. And then it fits really, really nicely with payroll and everything else that we do. So basically, like the way we liken ourselves now is like G Suite for business back office. So the hardest thing, even for like yourself, running your podcast or running any business, is you have this high value thing that you're really good at, whatever it is, your core business, I mean, the back office, but usually it's a Pareto distribution when you're small, especially like one, two, three, four, five people. You're spending like 80% of your time on back office, accounting, taxes, finance, payroll, and that is not a good use of folks' time. So we're doing our best to automate that on the backend. We're excited about that. So, Bench fit really, really nicely with those plans. 

Chris Powers: Okay. So, you get in touch with the board directors, they get you into the data room. At this point, have you called anybody on your team and said, get ready to work, it's going to be a long weekend? 

Jesse Tinsley: My team's always ready. The way we structured our team, we're ready. We are set up to spring. It's very different. 

Chris Powers: Is it all American based or is it cause it's global and you have people on in every time zone? 

Jesse Tinsley: No, we just don’t sleep. We sleep, I think there was a good line I was quoting recently, it's like, if you need more than six hours of sleep, you need to sleep faster. Like Arnold with his speech at like UFC back in the day. It was pretty funny. But it's a good quote. But yeah, just less sleep on weekends. 

Chris Powers: Okay, so you're in the data room, and then you talk to your team and you say, I think this is something we're going to do. So then what happened once you got through the data room and kind of liked what you saw? 

Jesse Tinsley: It's a bit of a blur, but the best of my memory, we got our CTO and COO and head of Corp dev and all those folks started to get rallied in their respective teams. And then we basically wanted to have a good, like even similar to like what we actually are doing with TikTok, not to get ahead of ourselves, but like the one thing that makes us really unique from an acquirer's perspective is we set up our whole business to go through acquisitions. And most people aren't set up to do that. It's very like painful and integration’s painful. It's slow and process is slow. Not at all how we're set up. We're set up to literally integrate in bed and jump in and actually operate these businesses day one, which is very, very unique. I think we've actually built our entire work around that structure. So our team was ready to go and more prepared. And I think that's actually ultimately why we actually won the bid. I don't know what the criteria was, obviously, but my suspicion would be that our bid was maybe not the best, but it was that we actually could stand the business up. And so, this business, any business, even TikTok might shut down, Bench more so, if it wasn't back up by Monday morning, your whole business is just a melting ice cube. It's gone. And so that was really important to, I think, everybody, to maintain value and do right by customers and employees. 

Chris Powers: When the announcement was made Friday, and maybe you know this, maybe you don't, were employees at that point kind of betting on something happening over the weekend and the office being open Monday, or were people starting to quit, like? 

Jesse Tinsley: Oh no, I mean, you can go back on LinkedIn, social, they're all... they're not happy, to say the least. So, there was no expectations of them coming back, so. 

Chris Powers: Okay, what point did you have a deal? By Sunday morning or by Saturday night or Sunday afternoon? 

Jesse Tinsley: Saturday, we had a deal agreed to. And then somebody was really upset with us. And they killed it. Thankfully, shout out to Dave Strohm from Greylock. He's one of our shareholders from another acquisition we’ve done. We’ve done really well for them, I think. He's part of the acquisition. And he's a legend. He's like the godfather of the cloud. That's his nickname, at least from back in the day, early VMware, SuccessFactors, EMC, he sat on the boards and invested in all those companies. So we put him down as a reference. Like, hey, not only can you do this, but call these folks if you want a backdoor. And one of the lead investors that sat on the board actually knew Dave from back in the day; he invested in his first company and was like, oh my gosh, Dave Strohm. How do you know Dave? And I'm like, he's our largest shareholder. So, he calls Dave, and I'm like, yeah... they like call him, whatever. Just give him context then because this is all happening so quick. I'm like, I haven't talked to Dave. Dave is, I would say, semi-retired, so to speak. He is in his late 70s and not in it day to day. And rightfully so. But I'm like, just give him a heads up, because he has no idea that you're calling, he has no idea what this is about. And so, they talk, and then, like it was phenomenal. And we pick up scene again the next day. So, kudos to Dave for being flexible and chatting on a holiday weekend between Christmas and New Year's, but talking with their lead investor over there as well. And then Sunday, that's when we finalized the deal, but we went back and forth a lot, a lot, a lot. 

Chris Powers: So, Dave gives you the thumbs up. You make a deal kind of Sunday morning. I'm just fascinated. So, what happens from like, okay, we're doing this to 5 a.m. Eastern, which is what, like 1 a.m. Pacific, where you are? The business- 

Jesse Tinsley: I was in Florida, though, so I was... 

Chris Powers: Okay, fair enough. So, essentially you were like, we have 18 hours to now close this business and make sure that we can open this thing first thing Monday morning, so that customers, this ice cube doesn't start melting. 

Jesse Tinsley: Exactly right. Yeah. Shout out to our team. And then also Bench’s team as well. Obviously, we started to pull some folks in on the engineering side on both teams, and we got the servers up I think like 4 or 5 a.m. Eastern, which was like a monumental feat, closed the deal a couple hours before that, and then jumping back into getting things live for customers and whatnot. Beyond that, like kudos to our entire team, beyond that, we had like 7,000 customer support tickets between closing Friday and like the time we got our team all on board. Because remember, we still have to go call all these people. It’s Sunday morning or Monday morning now, really early, we have to go hire everybody back. Like no one knows that it's happening or it's happened, this is not a thing. So we had to spend all this money hiring people back, we get them on boarded, and now we're trying to migrate systems and do all that stuff Tuesday. So, like we didn't even really get... like as much as we could, start getting back to customers till Tuesday and Wednesday. And then, immediately shifted I think the expectations of how we operate, which is like the original first email I forwarded to the customer. This is a cool story. Forwarded to a customer, I get a response back, an auto response from customer support, our customer support now. And it's like, oh, we'll get back to you in three to five days, and I immediately pick up the phone, call the VP of customer support and say, no, no, we need to do all of this in the next 24 hours. Like every single email that's with auto response needs to get back to you the next day or action it the next day. And so really cool story. And then we got through, I knew that was pretty much impossible, even though we pulled all of our other teams across our org, our other orgs, and put them into customer support to work on tickets. But we got, I think, through almost like all of them, to like 500, before they went offline at like the middle of the next morning. And then, we got the next day. So it was like 36 hours, we got all those things in action, which was really, really cool. 

Chris Powers: So is it fair to say the customer tickets were not people reaching out to tell you how great you were? 

Jesse Tinsley: A lot of people were really made at me even though I didn't own it until Monday. To back track one second, Chris, to be clear though like rightfully so, like I would understand why if I thought I lost all my data for an entire year because its the end of December. And so, I understand and totally empathize with the fact that, why those customers would be mad, especially when a lot of them were forced to pay for the year up front then, and then it just shuts down. So you're pretty pissed. It's a small business. You spend five grand, three grand, whatever it is, three, five grand. And then they're just like, oh, gotcha, surprise, we're shut down. They got a terrible outcome, no recourse. You are the bottom of the debt stack in terms of secured creditors. So it's just a shitty situation. And obviously, we did right by that by saying we'll honor whatever contracts. Even though we didn't get any of that money. So a lot of those customers were pissed and asking for a refund. I was like, it's a different entity. Like I don't have money. We didn't get the millions of dollars, whatever, that was lost in that transaction. So that's a really shitty situation. But I hope, I've been suggesting this for folks that people give us a shot... And most of them have. And it's been going really, really well. So we're excited. 

Chris Powers: It's awesome. What's the lesson you learned? Just usually I would imagine most of your acquisitions, you're not buying something that's metaphorically on fire. Like what's the lesson of like buying something where day one you're like public enemy number one and how you kind of rode that out and how you got your team to stay kind of passionate and optimistic about it? 

Jesse Tinsley: Yeah. So, I mean, I personally responded to hundreds of folks over that time. I think just leading with that, it worked pretty well. It quickly turned the narrative around, where it's like, oh, Bench sucks, screw the CEO, whatever, to they're really putting in another effort. And I think it quickly changed. And we had a bunch of champions on social. As they started to see me respond and engage more and more, I think it quickly changed the narrative, I'll say. 

Chris Powers: That's awesome. Then as far as hiring all the employees back, were most people willing to come back and excited to have a job, or was there animosity there? 

Jesse Tinsley: Understandably, some people were skeptical. I think the difference is that I think a lot of folks didn't understand, especially even like for customers that were like leaving, they were going to other companies that might be competitors or similar, but they're VC backed. That company is earning $10 or 20 million a year. We actually operate profitably. It's very different. Like your job's, from a psychological safety and a service perspective, and also like job stability perspective, we are the safest place to work compared to any of these competitors we have because they're losing tens of millions of dollars, and we operate profitably or cash neutral. And we do it right now. I think we're, I won't say the exact numbers for a few reasons, but we're in a very healthy spot from a financial standpoint. 

Chris Powers: Okay. That was a question. What caused Bench's demise? Was it because they were VC backed at the time burning a ton of cash and now you've neutralized it, or like what happened? 

Jesse Tinsley: I think this is actually more of like an overarching statement for all companies that we've purchased in the last couple years, is that what happened in 2021, ’22, you had this huge growth. Companies were just taking off and growing at all costs. And so what happened, salaries went up like that too. But like, unlike everybody else, we did salary cuts at some point. We said, hey, this is our salary, we're going to give more long-term incentives. All of our employees now that have been with us over a year are millionaires on paper. And that's a really cool story. But no one else did that. Everyone was afraid to say, oh, you make 300k [inaudible], which is a lot in the down market, and brought it down like not even recently. So you see a lot of that, I think across a lot of acquisitions if you [inaudible], which is insane, people, there's just no fiscal responsibility in my opinion across a lot of companies. That's not directed to Bench or any specific company, but... 

Chris Powers: Are you able to convince most people to take less for more upside on the back end? Or do most of those people generally say we're comfortable with the big salary, we'll go find it somewhere else? 

Jesse Tinsley: Fine with it. There's certain exceptions, obviously, but we want people to opt in or out. We don't want- it's actually one of the things, whether you love like Elon Musk or not, I'm a big fan personally, but I think the great thing that he's created for his companies that people don't actually realize outside looking in is that when you say, hey, it's Tesla, want to work at Tesla, people either really want to work at Tesla or they don't. And there's nothing in the middle. Most people aren’t just going to be like, oh, I just need a job. I'm just going to go to Tesla... There's a thousand other companies where you could just sit there and work nine to five. But for us, it's similar. And I'm not saying that we're like Elon Musk. But I think that the difference is we want people to opt in or out. And so, we say, hey, this is a startup and we're doing this and it's big goals and we've been clearly achieving them month over month or year over year. We want people to opt into that. And I think the fact that all of our employees have made millions or tens of millions of dollars, I don't think it's... So we're offering... We're just creating a tender offer, coming up for like 25 million for those, a lot of those early, it's going to unlock a ton of value. At least that's the plan, I can’t guarantee that, but it should happen in the next 90 days. And so, those are cool things, and I think that's a great thing to talk about for those employees. And if they don't want to come in for that salary, I mean, what I'd say is good luck to finding that salary elsewhere right now. It's not like the job market's crazy good for tech at least. And so, we've done right by our employers, and that's always going to be a thing that I stand behind. And I think it's like servant leadership. I think I posted that on LinkedIn recently, which was like, I hate the fact that companies do layoffs like bottom up, so they lay off all the bottom employees, like all the like ICs and like real managers, like the top down just stays super fat and [inaudible]. And most of those folks, in my opinion, are just rest investing, but bench levels. There's always some really good execs, but I think I would always prefer, if you want to be here and you want to be a leader, cut your salary first, cut your comp first, then go down from there. Then that shows me you want to be a leader. And some of them are like, oh, I want to get paid, and I need a title and I need all this stuff, go find another job. You don't belong here, in my opinion. If that's important to you... I understand making a living wage, but like the people that are in the IC level, if you're cutting those folks, that's living wage. Up here, not the same. And so I think if you can't like be a servant leader, then you shouldn't work at our companies. 

Chris Powers: When did you get into business? You were a firefighter at the beginning of your career. Is that correct? 

Jesse Tinsley: Good question. I'm happy to give some backstory. So I went to, I grew up in the Bay Area, got into tech pretty young. I went to school with a bunch of tech founders’ kids, one of which was Steve Wozniak. So, we always had all the like Apple products and stuff, which is pretty abnormal, but really cool. So then I went to college, I started volunteering as a firefighter. And then I basically worked as a volunteer for a few years and then got hired as a seasonal firefighter at Cal Fire, which is the state department of firefighting for California. And I did that for a few years. And that's a really cool schedule. Well, I then dropped out of school sometime in that, and I basically ended up working three days a week as a firefighter. So, I made money doing that, and I could work on my laptop from the station and whatnot. And then the other four days, I worked on my startup, which was Job Mobz security firm. And so that's the context of how all of this kind of started. And then eventually stopped doing firefighting a few years later, about 2015, ’16, and then we took off from there pretty quickly. 

Chris Powers: So essentially like you've been full-time business for nine years?

Jesse Tinsley: I was definitely full-time before that, I was just working like crazy. So no different than now, I guess, but just full time on this and not a mix of the two. 

Chris Powers: Yep. I just think it's really awesome. I mean, you can tell you've built a lot of wisdom and just maturity over nine years. Like, you can just hear it in your story. You've just seen a lot and I can tell just how you think about the culture and hiring and firing. Like, this isn't- it's like you maybe thought this the first day you started. You've kind of built this muscle over time. You've probably seen a lot of situations. 

Jesse Tinsley: That was like one of the things we- I joke, I tell people, people ask what my playbook is. You can't replicate it because I can tell you how to do it, but you have to know how to navigate that playbook. And you have to have the actual knowledge to move quickly and make decisions based on what's the likely outcome or the expected value. And that came from consulting and working with a scale AI, 23andMe, Coinbase early on when they're small startups and helping them grow. So, I understood like talent density and how to hire world-class teams and how leaders, even if they're like, let's say an average leader, not even a great leader, they can hire really great people under them and they're different, like meeting different orgs, those companies win and they win big. You just have to be great at recruiting. And like fundamentally, that's what we've done. It's obviously worked quite well. I’d say most of my team is very, very good at the things they do. 

Chris Powers: What is that? What's the term you meant? Talent density? 

Jesse Tinsley: Talent density, yeah. 

Chris Powers: So, expand on that a little bit. 

Jesse Tinsley: Yeah. So, you talk about a good example of talent density, like PayPal Mafia, which is often referred to for original PayPal folks. And you have Reid Hoffman, Peter Thiel, Elon Musk, David Sacks, all those original PayPal folks. Obviously, very high talent density. Same thing with Coinbase. You go through Web3 or Crypto companies right now, most of them are former or ex-Coinbase folks early on. I think that talent density is just having... Everyone says they have a high bar, how high is your bar and how selective are you in hiring those folks? I think in my experience, it's always better to hire slowly. Like we intentionally hire a lot slower than we probably should. Our team's like begging for resources, not because we want to, because we would rather wait and push and hire somebody over three or four months, the right person, than mis-hire an average like a C plus player or minus player. We want people that really make a difference. So we've done that. I mean, some of our team members like Laura, who just joined, she's early at Bolt, worked with her there. David Behrens, he's employee nine at Opendoor. Our CTO went to Cornell and was early at Periture and Box, really early on, [inaudible]. These are folks that all made a lot of money and are coming here for a mission and purpose. That's what's driving this as opposed to, I'm sure they have long-term incentive, but they're not here just for a fat paycheck. A lot of them already made money. And so, everything around them, the talent density actually comes a lot easier. But you have to start with A players. You can't start with B players and hire A players. Never happens. 

Chris Powers: Okay, you said the team's set up for integration. So, do you have a subset of your company that is built for acquiring and integrating, or are the same people that are running the day-to-day business also have this dual skill of we can kind of do both, or do you have kind of two teams, one running the day-to-day business and one looking for new acquisitions? 

Jesse Tinsley: Yeah, good question. So what we'll do with a lot of these companies is we'll stand them up or keep them the way they are currently operating. We'll move all the operations, essentialize like finance, legal, all of that, and HR, payroll, recruiting into like what we call a shared services team. And then we have on that shared services team, you have our CTO, our COO, corp dev, biz ops, business analytics, and stuff of that nature. So, on that side, we have SWAT teams. And so, we pair up and we're hiring, we should hire some more folks for these roles. Well, like our CTO and COO will basically be set up to basically run as like a president and a CTO at any company, so basically the CEO and CTO, and they'll plug in. That's what's happening with Bench, for example, because people, the big question being now with TikTok is like, hey, Jesse, how are you going to be CEO of both? Well, what they don't understand is that I'm not, I'm technically the CEO, but I'm more outward facing than inward facing. David and Ben are in Bench right now as CTO and COO, I'm president, and basically are running all the day to day. Like, yes, I'm still involved. Yes, I'm talking to customers. But I'm more outward facing than inward facing for the most part. And we're hiring more folks like that. So, our model is similar to like Thoma Bravo originally, when they were plugging in operators to run businesses they acquired. For us, it's similar, but they would eventually come back to the centralized hub and we'd have one platform. It is end to end, like a competitor with like ADP or NetSpeed or something of that nature, some legacy companies that are pretty enterprise. 

Chris Powers: Dude, it's really impressive to hear you talk. Okay, is this a playbook that you kind of crafted along the way, or did you just steal this from the group that did it best? Like, how did you come up with this playbook? 

Jesse Tinsley: No, I completely built everything based on first principles of what I thought to be true, like what was universally true. But more importantly, something I've talked about a lot, I get flamed on social media for it because people don't understand it. They don't understand it, but it works, that's just, which is great. But like, so what we do is we align every year, what are our goals for the year? What are like the core three things we want to achieve this year? And so, with this structure, it's actually based on actually one role and you basically have an end-to-end product parity with a few of our competitors, a little bit larger. And we'll have done that in like 18 or 24 months, achieved complete product parity with basically no funding comparatively. They've raised hundreds of millions of dollars, and we've both done it in 24 months, and it would take those competitors 20 plus years, 10 plus years to do. And so that kind of shows you the way we structure things is really fast and efficient and streamlined. And we have a huge result. I mean, we're going to hit unicorn status here in the next few months, if not already, depending on how you value it, and kind of off to the races. So I think we're profitable. We've reached that. We don't need to raise money. But we're going to be raising a pretty large round here. And we already got some big capital commitments I think I can’t talk about, but nonetheless, things are happening. 

Chris Powers: Are they, do you think through the three big things as like the OKR method, or is it a bottoms up, like let's hear from the team? 

Jesse Tinsley: I don't even know what OKRs are. I can't even tell you what it means. I’d have to look it up. Basically, we'll look at what the core objectives are, and then we rebuild our entire organizational structure around that. So one of the things, for example, like we don't have traditional HR. And I mentioned that in December, people were like beside themselves. Like, first off, we're not woke or anti-woke. We're very stuck in neutral. We want to work with everybody, not just one side or the other. And second, HR is, one, employment law goes to legal anyways. So why not just have it go straight to legal? Operations can run payroll, and finance can run payroll, and all the big data operations. And our managers should be supported to basically be really great like people, like leaders, not managing. There's no need to manage if you’re hiring great people. Give them the goals, their expectations for what they're trying to achieve over the next quarter, six months, so on. And most great people will just go do it as long as they're clear on what their goals are. And so, HR has become like, I think the last few years, especially with like DEI and everything else, has been kind of like this hall monitor where like the jury, judge, and executioner essentially for employees, where like, oh, we're a family. We really care about you. And then like, oh, by the way, we're doing layoffs. Sorry. See you, Chris. I'm putting you on a performance improvement plan. That's not a great thing for culture. So, we actually have people that do culture, but it's only- it has nothing to do with your performance. It has nothing to do with layoffs. It's completely separate. So we separated the two because like, think about that. How would you want to tell somebody that's responsible for firing people that like your father passed away and that you're kind of down on yourself for like a month and they might let you go because layoffs are around the corner. Like that's not good psychological safety for employees. And so we think about a lot of these things, again, from first principles. Everyone else in tech just does their org structures the same way everyone's done it for the last 50 years. There’s [inaudible]. There's no innovation. How can you be an innovate a company but not reflect what's important to you from an organizational structure? It just doesn't make any sense. I'm glad no one else is doing it because it works great for us. As soon as people start copying us, it probably won't work as well. But for now, we've got a huge advantage. 

Chris Powers: My team's going to listen to this podcast episode and then they're going to notice some things start shifting around the company pretty quickly. I love that you pick three things. So question there, who participates in understanding the three objectives for the year? Is that a bottoms up, like where you're hearing from the people closest to the customer every day, or is that happening at the executive level in some offsite? 

Jesse Tinsley: No. So, it's everybody. We have a really open comm structure too. I tell... [inaudible], it kind of ties into project Aristotle from Google back in the day where they basically did a study to figure out what creates high performing teams. And it wasn't like where they went to university and all these things. They spent like tens of millions of dollars on it. What they found was like high performing team have really good communication. And so, we set up a structure where like, if you're the intern, you can ask me a question, and you can ask me a really bad question. Like there's no, I'm not going to be like upset. Like it's just going to be like, okay, cool, this is the answer and move on. But the reason is we want to create that so people aren’t- we would rather have them ask us a silly question than like a customer. So it's really customer-facing and centric. And then similarly with how we build products in my companies, we're building around a vision that our customers have basically created. Who are our customers? Who are we trying to serve? And that's working really, really well for us. And so that's kind of the context. And then in terms of team off-sites, we actually model like what I think Steve Jobs did with regards to off-sites. Like we invite whoever is our top performing employees. I don't care if they're C-suite, I don't care if they're an intern, they get invited to come hang out with us wherever we go, whether it be, if we're in Las Vegas, we're in like Tahoe prior to that, a bunch of huge company offsites. And it's only the top 5 or 10% folks. 

Chris Powers: I love it. And I'm assuming you have no bias towards age. Your bias is towards ability. 

Jesse Tinsley: We perform, I don't care if you're 70, like Dave Strohm is in his 70s, and he's like our top performing external shareholder. I'm like, I call him all the time, like as much as he wants to be helpful, he's a great guy. I don't care if you're 19, if you're the best person for the job, you should be in the room leading that function. 

Chris Powers: Okay, you've probably had a bad VC and you've been talking about this gentleman, Dave, who's a great VC. What makes a great either venture capitalist or investor? Like how have your best investors actually provided value beyond just a big check? 

Jesse Tinsley: Just shout out, generally speaking, Greylock, super helpful across both, all the things we've been doing. They have a great reputation. Dave Strohm actually was the founder of Greylock in Silicon Valley. He went from the Boston office and founded the Silicon Valley office back in the 80s, so a long time ago in inventor speak. But they've been really, really helpful, their whole team. Yeah, I would say, what do they do? They are incredibly responsive. They give great intros. They give product feedback. They make intros to subject matter experts if we don't have them or we have questions on certain things. Just overall, really actually helpful, responsive, communicative, I mean, the list goes on. There's a lot of folks who are pretty hands-off or just give bad advice. The difference is they're also giving really strong advice. It's easy to get down to just vanilla advice, but they actually think about it, help solve the problem, bring in the right people that can solve the problem. And similar to how we operate too. Like I tell people, like I don't need to be the smartest person in like any one subject, but I'll hire people that are the best. I'll find the best person, I'll call them. Like it's a superpower of anyone in any profession. You don't need to be the best at anything, just find the best person at that thing, hire them or consult with them or find a way to work with them. That'd be my advice. 

Chris Powers: If interest rates go to 10%, I might be applying for a job to work for you. This sounds exciting. 

Jesse Tinsley: We are hiring quite a bit on that note across a bunch of companies. We've been doing some cool stuff. There's more to come too. Outside of TikTok, we have six other acquisitions lined up, in process of closing, moving towards a definitive agreement, which is pretty cool, and then we'll see where that takes us from there. 

Chris Powers: Are those six more, I would imagine TikTok and your Employer.com business, that's kind of two separate things. Are the other six more mission critical to Employer.com or are they kind of all over the board? 

Jesse Tinsley: Yeah, they're specific to like Employer.com. Yeah, it would be some new products and features to tuck in to our existing platform. So it would be really cool. It'll push us to like, I want to say the pro forma number, like maybe 130 million ARR, and then like 160, 70 revenue. Right now, we're like 100 million revenue and like 70 ARR, give or take. So we'll be there by like May. 

Chris Powers: Are most of those acquisitions kind of your vintage VC backed companies that aren't going to like become these enormous things, so they're kind of hitting the market, which is kind of the narrative in tech to some degree, or like are most of these, like what's the general profile of a business that you're buying? 

Jesse Tinsley: Yeah, it's usually like five plus ARR all the way up to a hundred billion revenue or something like that. It depends. A lot of VCs- VC's spot is very interesting. We have a bunch of ways to compete against them. But what's happening right now is you see these companies that raised in 2020, 2021, 2022, they basically have hit flat growth if they're good. The good companies hit flat growth. If they're mediocre or average companies, you'll see some with moderate growth. But generally, they can't raise another round of venture off of that. And then historically, you'd have to go raise venture, like a growth round with private equity, which might as well be the worst idea in the history of the world if you’re a founder in my opinion.... I don't know any context here, but one example that I came across, I was looking at the top IRR returning funds of all time for private equity. Essentially, we kind of operate similarly, but not quite the same. We liken ourselves [inaudible]. But long story short, the number one, again, not a knock on them. [inaudible] number one for IRR, which probably will give you an idea of what might've happened. Number one IRR return of all time was FanDuel. FanDuel is a venture backed company. They raised growth equity. What happened is there's a waterfall, allegedly, there's a waterfall. Like I think, I don't know the exact number, but let’s say it’s like 500 million. Well, they did an all equity deal for 490, which wiped all of the other shareholders. And then it later went on to sell for 12 billion. Private equity firm made a lot of money. Founders and early employees, I think, were suing because they got nothing and were really upset about it. Don't know who's right or wrong, but the point being is that generally I've seen, not talking about those folks, just with other companies we bought. We do go against private equity a lot because they're not as founder-friendly. That generally works really well for us because we are very founder-friendly. And this isn’t a knock on private equity, by the way, Chris, I love private equity. Just to be clear, I'm a big fan, especially in the real estate space and like others, like it's very different because you're using leverage and you're buying. It makes a lot more sense in that sector. Very hard in like the LVO or VDO, like venture buyout funds because they're actually not operating, we're actually operating, similar to yourself, I assume, with your operating group, you're actually operating and managing your portfolio. Very different than being a thousand miles away, not touching, managing the facilities and making sure you have good property management and stuff like that. It's very different. Easy to give advice, like I said earlier. Vanilla advice is easy from a thousand miles away. You're not in it, you won't know what's going on. But yeah, so the point being is it is very tough for these startups. Can't raise venture round, private equity is tough. Like there's some great firms out there, obviously. And I know a bunch of them. Like, I’ll name some like Carlyle Group and like Apollo and Excel and like those are very... they're all very good firms. Blackstone, like those are all really reputable firms. There's a lot in the middle that you probably never heard of that are less, less so. They're trying to make a quick buck. So I think it puts founders in these weird positions where they can't- they're kind of stuck. And we basically set up a mechanism where they can make a lot of money and also get chips off the table and still have a lot of upside without having to risk as much in that perspective. Because basically like, I posted about this recently, post-series B or C, what founders don't realize, even if you raise venture capital, you're essentially selling your business. Because what happens when you raise $50 million, you lose board control. You could sell your business for a hundred and you can take the 50 yourself and roll the other 50. But in this case, when you raise the 50, you're investing the 50 million to basically give up ownership of your company back into the business. That's a great deal for VCs. And no offense to them. Like I said, I [inaudible] VCs. We also have a bunch of backers. But it's not great for founders and early employees in that context. Because now you're subjected and you're below the waterfall and there's a pref, liquidation preference, and that makes things really tough for employees to make money and founders too. So we have found a sweet spot, and that's gone really, really well for us. 

Chris Powers: I love it, man. All right, we'll finish on a story, which is a big story, maybe. So we'll play the timeline game again or the timeline game again. So, I'm assuming this is another deal. You get on X and you hear that that TikTok is shutting down. I'm just guessing. Is that fair?

Jesse Tinsley: That is fair. Yeah. I'm rarely on TikTok myself, which is ironic.

Chris Powers: I've never had an account on TikTok. I think I created one seven years ago. It might have one follower on it. I haven’t been on it probably six years. No, it's obviously incredible. I have two younger sister-in-laws, my wife's sisters, that I watched grow up. They're only 18, so I've watched them grow up since they were four. And TikTok and Snapchat seem to be the flavor of the day for that generation. 

Jesse Tinsley: Yeah, no, it's huge. I'm happy to talk about the TikTok story. It's a really cool one. I'm really excited. I think that's part of our ambition, my ambition of buying it [inaudible] monetary [inaudible]. Right now, you have the most powerful platform in the United States for social media, like for Gen Z, there's a lot of future leaders in that, future congressmen and women and Senate leaders and future president of the United States in that generation, I'm sure. And so right now, we have it controlled by a foreign adversary in the United States. It's manipulating that data and the populations. And they can create whatever narrative they want. And right now, I don't think it's in a good place. And our data, all of America’s data is on TikTok right now. It's not safe. It's in servers in China. And it's just not a good place. 

Chris Powers: You read a tweet, it's going under, they're going to take it down. Was the first time you read that, was your next thought, I'm going to buy it, or did that at least take more than 24 hours to evolve? 

Jesse Tinsley: Yeah, definitely not. So, conceptually, and I tweeted about it maybe a little bit prior. And then I reached- I put out some feelers because we were already raising for Employer.com, we were in the middle of a raise. I raised like 15 million in like 24 hours. And so I'd already been talking to a bunch of folks in that context. And so, then I called up one of my other friends, and we put out some feelers to some of the large players we know, globally and domestically... [inaudible]. And so, we put out those feelers, and everyone was like- I've never, Chris, never in my life seen like more money be thrown at me so quickly without anything. I have no deck, no data, like there's no nothing. Just like, hey, Jesse, I'm in for- and these are on the small side, like I'm in for 25, put me down for 25. Hey, I'm in for 100. I'm in for 500. I'm like, what's going on? These are like two minute phone calls. Like two minutes, I'm not even like pitching, like, oh yeah, you're in? You're leading it? Who else? All right, well, put me in for five bill. In fact, oh, can I do like 10?... I'm like, what is going on? Everyone wanted to get in. Obviously, I'm well-connected, like I have a track record for doing this with like [inaudible] is a very similar example, it’s a Canadian company, moving assets, [inaudible] to the US service and the US customers. And so, with that momentum and background, there's a lot of trust that we make good deals, make a lot of money for our shareholders, which we've done. I think our IRR on my first company is like pushing, if not into it, almost close to triple digits, which is unheard of. And I think that track record helps to say the least. So it turned into something really very, very quickly. We have some cool folks. I think we can mention some. Andrew Wilkinson's in, personally, just clear, and then he's a small investor too, just to clarify. But like there's a bunch folks like that. Obviously, I think I tweeted about the other one, the most popular influencer in the world. And then we have a bunch of big names like that, Greylock is in, my investor I talked about earlier, Dave Strohm, those folks over there, they're awesome. It took a life of its own very quickly. 

Chris Powers: You start talking to people. Have you already gotten in touch with TikTok at this point? 

Jesse Tinsley: No, no, no, no, we have not. I didn't even bother to reach out to them. I wanted to figure out what momentum we could get. I actually need to [inaudible] funding, that's why I sent out a tweet after the fact. So I moved pretty quick to get people that I trusted that verbally were committing to very large sums of money that can actually respond to capital calls. And then we started to get things in process from there. And so I think by the- I don’t know the date at this point, but I think by the end of the last week or over the weekend, we submitted a formal letter and information packet across the board to BytdeDance and TikTok and all those folks and then, out of respect of President Trump and his administration, we [inaudible] potentially after, and everyone on that side of the house. 

Chris Powers: And to be fair, you probably, I'm assuming you can share this. So it is owned by ByteDance, obviously, that is in China. Do we know the shareholders of ByteDance? Do you know that actual makeup, or is that still a black box? 

Jesse Tinsley: I know some of the US shareholders. 

Chris Powers: But it's not the CCP. Or maybe. 

Jesse Tinsley: Somebody was mentioning, I'm not sure if this is true or not, but I believe there's a golden share rule in China where basically President Xi can basically make a majority vote on anything that happens within that company. And so at the end of the day, I think it's one part commercially, I think commercially we get the best offer. I think from a technical side, we actually have the best chance. To be clear, and I know there are others that have talked about this, we already have a full like sussed out platform for this. It's like, we spent billions of dollars on infrastructure costs. It's already pre-planned for like... and have US servers and everything else here like day one. And we already have some of the best technical experts from security and algorithm perspective on our team. And we've already created like a bunch of sub-teams of like the best folks that we talked about earlier in the podcast. That was already set up. And so, from a actual operational standpoint, to stand this up in the next 80 days, we're the best buyer for it in my opinion. And it will come down to from there President Xi and President Trump figuring that out honestly. I think it's not less on the commercial side... more so on that side. 

Chris Powers: And that team, those teams you're talking about, those are teams that don't currently work for you and don't currently work for TikTok? Like you're building those teams theoretically in real time? 

Jesse Tinsley: Very real, yeah. 

Chris Powers: Are you the CEO? Will you be the CEO of TikTok, or will you go hire some big name? 

Jesse Tinsley: Let's assume that we get it. So if that's the case, I'm the CEO for some period of time, at least for a transition. I'm pretty no ego with all this. I tell people all the time, I'd be the janitor. As long as I have skin in the game and we win, I don't care. From the time we know, I think I'm the right person just to get it. I've already got a lot of great folks and it'll be- going back to what I said earlier, I haven't run a B2C company before, but I understand how to build great companies and I've done that time and time again. And Coinbase is a good example of a B2C company. We'll have some of the best people in the world. Some names will be very- we'll hit home. So yeah, we're excited. 

Jesse Tinsley: Okay, really quick though, I'm not going to stop on this team thread. So you're building a theoretical team in real time. And when we're talking real time, we're talking maybe over the last couple of weeks. Are you calling these people directly and talking to them? Or do you have- how do the- because I can feel it, I can see it in your eyes, these are just the A plus cream of the crop. Is this you picking it up, or are these people hearing this is on the table and they're calling in going, if this is actually happening, I'm in? 

Jesse Tinsley: It's definitely both. So, some people strategically I went out and got, and then Keith Lawson, who we both know, [inaudible], texted me. I hope he doesn't care I mentioned him. I don't think he will. But anyway, he texted me, he's like, hey, I got this intro. Like, you want to talk to so-and-so? So that's been happening a lot. Keith's just a good example of that. But that's happening every day. Like, I'll wake up, I get like 25 plus test messages, and like there's some intro. Like, hey, I want in on this. I want- so it's been crazy. There's probably a bunch, and I apologize if that's the case and you're watching this, that I have not gotten back to because I just haven't had a chance to even look at them in my inbox, and it's pretty insane. But yeah, I would love, if you know somebody that's great, would be very interested in the team, we'd love to chat. 

Chris Powers: So, you were in Washington the last week, and when we chatted on Thursday, you were flying back, and I just said- and you said, I think your comment was like, man, the public sector is a lot different than the private sector. So, you arrive in DC, like give me the cliff notes or the highlights of like what you learned that week and now your kind of view of DC that might have been different than when you got there. And I'm assuming you're there to kind of talk to the powers that be that if this is going to happen, they're going to have to kind of give you the thumbs up. 

Jesse Tinsley: Happenstance, I was already going to the inauguration, got invited a couple of weeks ago to one of the parties. And so I was already going to that. And it was the one hosted by Rumble and Trump Media. And so, I was going to that party, and I was already out that way. And then I stayed until late Thursday night. What I can say, I think we have a ton of momentum, is we were the last, as far as I know, first off, the last buyer that was in Washington after the inauguration. Take that for what it's worth, but we were having ongoing dialogue with lots of different folks, and everybody else left on Tuesday. I was there until late Thursday. And I had to get back Friday for something, but otherwise I would have been there for longer. And I think we'll be going back out pretty soon as well. So all things considered, I think things are going in the right direction. I think we're like people's bid for TikTok. Because I think TikTok shouldn't be owned by one rich person. I'm sure it could be. I think I posted some of the odds this morning, like betting odds online, but it should be owned by folks like myself, former firefighter, or people that are across the United States. And that's like my whole legacy is to get it to as many great people, so there's not just one centralized power that owns the most generational platform that has an impact, could be used for really, really great things and can be an advocate for freedom of speech and other things that right now I think are less likely to be seen on TikTok overall. 

Chris Powers: And if you bought it, obviously now it's American owned. Are you only owning the American operation, or do you own the whole global operation and now it's just controlled by a US based company? 

Jesse Tinsley: It would be TikTok US, and it’d be all, US [inaudible] of directors and C-suite and all our servers, all our technology will be here. So we’d make sure that there's no, there's nothing going outside the United States. And so that would be good, and I think we kind of already have got that set up from the technology side, basically have all our data centers, servers, all our software, all the code here in the United States. That would be good. And it'll be rebuilt from scratch. 

Chris Powers: When you buy a business like that, maybe it's really too early. It's clearly like the most viral consumer app out there, maybe there's something more viral, but TikTok seems to be the one that gets brought up, is the goal just to kind of buy it and keep running it as is, or the people showing up to the table going like, we could do this with it, or we could do that, or is it kind of like buy it, stabilize it, and then we'll start ideating later? 

Jesse Tinsley: Yeah, totally. I think it's a lot of stabilization, making sure data is secure. There's a lot of migration, legal, and finance stuff to do on that front, so I think that's the first thing. I think just getting it set up. Just to be clear, because I've had this with other acquisitions, if you're a US TikTok employee, we plan on retaining everybody, your job is safe, there's nothing happening other than, like I said, I did mention C-Suite, so that could be a caveat, but still even with those folks, if they're leaving, we’d love to them transition [inaudible] and pay them quite a bit to stick around and help give context on how to actually transition that business. And so folks asked if we're going to have the same offices and whatnot. I think we have offices in Austin, Los Angeles, San Francisco, New York, and a bunch of other places, and all status quo, nothing would change there for the US-based offices. 

Chris Powers: Okay. I have one final question because you have built kind of your own operating playbook. Do you have a favorite entrepreneur or a favorite business where some of this comes from? 

Jesse Tinsley: Yeah, good question. I've talked about this before. What kind of inspired me about this was, it's obviously a mix of things, but in 2020, I was really bummed at the end of the year, not because of COVID or anything, because I missed the opportunity in the macro. There's just so much opportunity to do different things and pivot your business, not from a personal perspective, but from a business perspective. And so I took some good takeaways from Thiel’s book right here, Peter Thiel, Zero to One. That is a great one. Only the Paranoid Survive by Grove. And using reflexivity and strategic inflection points and asymmetrical information, that's Soros, Grove, and Thiel, which is funny because they're obviously different politically, but those three concepts I use pretty much in most business decisions. And they're kind of my North Star in terms of what I do. Because if you put them together, it's pretty powerful. 

Chris Powers: I love it. All right, Jesse, thank you for taking time on a Saturday. This was awesome. 

Jesse Tinsley: Appreciate it.