Unlock the secrets of entrepreneurial success with this inspiring episode of the Beyond Fulfillment Podcast featuring John Worthington, founder of Tech2U and Sircles! If you’re an entrepreneur, small business owner, or startup founder searching for actionable strategies, innovative funding ideas, and real-world advice from thriving business leaders, this episode is packed with value.
In this episode, you’ll discover:
Why John left review platforms like Yelp behind to build a community-driven recommendation app (Sircles).
The biggest risks and leaps of faith every founder faces—especially when raising capital.
Proven crowdfunding strategies that helped John raise over $7 million on Kickstarter and WeFunder.
How to harness community and influencer partnerships for explosive growth.
The entrepreneurial mindset shift from chasing negative feedback to building a business on positivity and trusted networks.
Advice for scaling your business at a sustainable pace, avoiding burnout, and building a loyal team.
The importance of having a mission-driven “Why” for your startup.
Tips on navigating reputational risk as your raise funds and lead your venture.
Timestamps:
00:33 Origin story of Sircles: solving problems with Yelp
02:11 The leap toward a “friend-powered” model
03:11 How & why they chose crowdfunding
05:36 Crowdfunding tips & influencer partnerships
06:56 Building a positive, recommendation-focused app
10:07 Early community-building tactics
11:23 Next milestones & scaling beyond your local market
12:22 Fundraising advice for early-stage startups
14:21 Navigating risk and reputation as a founder
15:40 Lessons learned from Tech2U & scaling wisely
16:55 The value of trusted partners in business
18:05 Where to find and connect with Sircles
If you found value, hit Subscribe and tap the bell icon to never miss actionable interviews on entrepreneurship, startup growth, and funding strategies!
Connect with John:
Social: https://www.linkedin.com/company/sircles
Website: https://sircles.com/
#Entrepreneurship #StartupAdvice #Crowdfunding #SmallBusiness #BusinessGrowth #FounderStories #BusinessPodcast #CirclesApp #BeyondFulfillmentPodcast
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Today, we're sitting down witha true visionary, John Worthington.
With over two decades ofexperience under his belt, John co
founded the thriving techrepair company Tech2u.
But his latest venture istackling a frustration many of us
share the often toxic world ofonline reviews.
(00:21):
John is the founder ofCircles, Spelled with an S, a groundbreaking
app built on the power offriend powered, positive only recommendations.
Forget sifting throughmanipulated ratings and negativity.
Circles offers refreshingantidote, connecting you with trusted
suggestions from your personal network.
(00:43):
In this conversation, Johnpulls back the curtain on the inspiration
behind Circles, the bolddecision to fuel its growth through
community crowdfunding, forwhich he raised an incredible $7
million, and the uniquechallenges of building a platform
that's centered on Positiv.
He also shares invaluablelessons from his entrepreneurial
(01:05):
path, emphasizing the role ofa clear mission and authentic community
engagement.
Whether you're a buddingentrepreneur, a small business owner,
or simply tired of onlinereview drama, you're in for a treat.
Get ready to explore a newhorizon of trusted recommendations.
As always, if you found valuefrom this content, please like and
(01:28):
subscribe.
All right, John Worthington,welcome to Beyond Fulfillment.
Hi.
Thanks for having me.
Yeah, absolutely.
We appreciate you taking thetime to be here, John.
All right, so let's get rightinto it.
So, John, what specificfrustration or observation, and perhaps
(01:49):
it was even stemming from yourprevious experience with tech2, you
what frustration ignited theinitial idea for Circles, and it's,
it's focused on trustedrecommendations, right?
Yeah, you know, it was acombination of things.
We.
Tech to you is a computerrepair business.
I started with a good friendof mine from college, started just
the two of us.
We have multiple locationsnow, over a hundred employees.
(02:12):
And you know, we, we have Yelpreviews just like any other small
business.
And we found over time thatYelp was not really pro business.
They act like they are, theysay they are, they promote themselves
that way, but the reality isthey're kind of a bully.
And you know, if you have afake review, you know, maybe a competitor
trying to attack you, whateverthe case may be, it's just really
(02:34):
hard to even get anybody to doanything at Yelp besides just send
you to their sales funnel.
And so it was really frustrating.
You know, we, you get a onestar reviews for something silly
like your lobby is too cold,you know, and there's no recourse,
but it makes your overallscore look bad.
Not to mention the fact westopped paying them at one time and
(02:54):
they filtered, quote, filteredout hundreds of five star reviews
and Then when we paid themagain, they magically showed up.
So we're like, there's got tobe a better way.
And we had this idea of, whyisn't there a place where I can just
see recommendations frompeople we know and trust?
I don't know of any app orwebsite where I can go just see my
friends recommendations.
Because I'd much rather hear arecommendation from someone I trust
(03:15):
than read reviews from strangers.
Attention, Shopify sellers.
Are you tired of slow sales?
Do you want to skyrocket your revenue?
Well, you'll want to join thisfree masterclass from my friends,
the Traffic Ninjas.
Learn how to optimize yourstore, boost conversions and dominate
(03:37):
your niche.
Sign up with the link in theshow notes and take your Shopify
business to the next level.
Wow.
Okay.
And you know, like, you justtouched on the, the established nature
of Vue platforms.
We all, you know, know whatit's like to, to at least use them.
I mean, what was the singlebiggest leap of faith you took when
(03:58):
deciding to, to pursue the,the friend powered model of Circles?
Well, you know, we're still asmall business at the end of the
day, so allocating resourcesis always a tough decision.
It's got to take a lot ofplanning and foresight and risk.
So that initial investment,you know, once, once you start down
(04:19):
that road, pretty soon there'sno turning back.
So hiring some staff, youknow, putting together a plan, developing
a concept and all that, youknow, it's going to take financial
resources, going to take ourhuman resources and our creative
capacity and all those things.
So making that decision andgoing forward with that, it's a really
tough decision.
It's a big, a big decision andkind of a life changing decision
(04:40):
if you decide to pursuesomething like that.
Because it's not going tosucceed if you don't put your life
into it.
If you're not obsessed, don't bother.
Okay, and why did you choosecrowdfunding through platforms like
Kickstarter and we Funder asthe primary funding method for Circles
(05:01):
in the early stages?
Yeah, and looking back, itseems like an obvious decision, but
at first it was a lot of debate.
Should we do crowdfunding?
Was that good, a good idea?
For us, it was kind of a newconcept at the time.
A few years ago, looking back,it was, it was perfect because for
us, especially the app thatwe're developing, Circles, it's spelled
Circles with an S, S, I, R, C,L, E, S.
(05:23):
It's really all about sharingthings with your circle.
And I trust recommendationsfrom My friends, I don't ask them
about five places they don't like.
I just want to know, hey,what's a really good restaurant?
Or what's a good movie you'veseen lately?
So going into that, we, wedecided that we're going to make
this app all about positivity,just because there's no, there's
(05:44):
no reviews in this concept.
This is all about recommendations.
So when we, when we firstlaunched on this idea, the idea started
developing first to just likekind of an anti Yelp kind of platform
of how we can.
What can we do to disrupt them.
But then real soon, werealized this is all about community.
And because it's your circle.
(06:06):
And so where Yelp, you don'thave friends.
On Yelp, it's not social.
But other social mediaplatforms, you know, obviously have
friends.
And with Circles, it's allabout your circle of friends.
So community and crowdfundingreally go hand in glove because crowdfunding
is about community.
If you don't build yourcommunity in crowdfunding, you're
(06:26):
not going to make it.
You really.
It's all about.
Because it's small investors,lots and lots of small investors.
It's not like a couple biginstitutional investors like the
traditional way.
So building that communitywith crowdfunding really good.
Went hand in hand with whatwe're trying to do because all those
small investors become loyalusers because they're invested.
Of course, they tell theirfriends and family, so there's.
It's more sticky.
(06:46):
So that whole communityconcept of crowdfunding, it just,
it made perfect sense as westarted really thinking it through.
And then from there it has.
It's really been just anoutstanding decision.
Probably.
I don't know where we'd be ifwe didn't do it.
We ended up raising over $7million in equity crowdfunding, one
of the highest of all time, actually.
So it turned out for usparticularly, like, just a perfect
(07:09):
fit.
Okay.
Yeah.
And, you know, like you said,you've done very well in terms of
the amount raised.
And being that it was, youknow, you weren't sure about that
at first.
Like, was there any specificstrategy that you, you used to.
To raise so much?
A few things, yeah.
(07:31):
Really building that communityis a big part.
You know, start with yourfriends and family and start with,
you know, we have customersand such and close friends and partnerships
and things around ourcommunity that we've already built
with our small business.
You start there.
And then we teamed up with areally, really powerful local influencer,
someone that has been on theair for many years in our community.
(07:52):
So, you know, he's got apretty trusted brand and reputation.
So partnering with somebodylike that early on, at least for
us, was a really good decisionbecause, you know, we're nobody.
Nobody has ever heard of us.
But if you have a partner thathas a bigger audience and also believes
in you, you're obviously goingto be able to amplify your message
(08:14):
a lot faster.
So that kind of strategy for,at least for us, again, it worked
really well.
Now we're trying to get out ofour local area, but we think we can
probably scale that withinfluencers that have more of a national
audience or internationally,so say.
So we're actually just now inthat phase of talking to people and
interviewing and all that.
Okay, and did you encounterany skepticism or resistance when
(08:39):
like, introducing the conceptof and shift shifting from anonymous
reviews to like personal recommendations?
Well, if anything, it's.
It's such a new concept thatpeople are like.
One of the number one things Ihear is, oh, what if I want to leave
a negative review?
And we're like, well, youknow, there are apps for that, but
(09:01):
we're about recommendations.
Again, I don't ask my friend,tell me five places you dislike.
It's, you know, I'm justtrying to get to the spots that,
that are good recommendations.
So we just, we don't do that.
So we built the app from theground up, deliver very deliberately,
very intentionally to be only positive.
Like a lot of guardrails inthere so that it stays.
Stays positive, which ofcourse is very refreshing right now.
(09:23):
We.
We get a ton of positivefeedback from our.
Our community.
You know, it always helps tohave a mission that people believe
in, which of course, circles does.
So that's helped us gain a lotof support just because of how negative
and toxic and how much dramathere is in.
In regular social media.
Even Yelp has.
Majority of their reviews are negative.
So being able to have acommunity that is looking for something
(09:47):
new and positive, that.
That's a big, big forcemultiplier for us that really helps
our network effect.
Yeah.
And you know, like you said,social media in general can be very
negative.
And I'm the.
There's an old adage,something about like, like a negative
review.
I don't, I don't know what itis exactly, but, you know, it'll.
(10:09):
It'll travel much faster interms of talking about what you don't
like versus.
What you do like, but it'slike 10 to 1.
Yeah.
For a negative comment.
Word of Mouth than positiveword of mouth.
Okay.
Yeah.
So, I mean, was that, was thata hurdle you had to overcome in terms
of people just adapting tothis concept of, oh, wait, like it's,
(10:30):
it's only, it's only something positive.
That's a great question.
And yeah, I would say kind ofindirectly just because not so much
that direct situation, butmore parallel to that, which is the
social media platforms thatgot popular exist today and grew
(10:51):
into huge companies.
They thrived on the drama.
They, it's that, that fear andanger emotion is so much more powerful
than the feel good one becausesame reason the word of mouth, the
negative word of mouth is 10times more powerful than the positive
word of mouth.
So same with us.
So we, our challenge more thananything is just keeping people's
attention because it's not,there is no drama and it, you know,
(11:14):
there's not that, that triggerthat makes you come back and want
to argue.
So it's a little, it's just aharder challenge to press the feel
good button for us.
But we're finding the formula.
Like there's a lot of reallycool things we're doing.
But yeah, it actually has beena challenge.
Like sometimes we joke like,oh, it'd be nice if we could just
open up, you know, wild, likecomments and like have people say
(11:34):
whatever, but, you know, it'sjust not in the spirit what we're
doing.
Okay.
And so given that it's, it'slike a departure from the norm and
it's a new idea and then, youknow, it's, it's a community app
with, with no negativity.
I mean, what was your nicheinitial approach to like building
the community and generatingenthusiasm like among the early,
(11:57):
early adopters?
We had to start slow.
You know, app development is,is really challenging.
It's, it's much harder thanlike building a website, for instance.
It's software development andpeople expect the app to be on par
with the best apps out therein the world.
And so that's a high bar.
So we really, we just startedslow with, you know, basic proof
(12:18):
of concept.
You know, obviously had a realsmall audience.
You know, friends and familystart with and they're very forgiving
of bugs and, you know, thingsare going to be wonky all over the
place.
And that's, that's normal forany app developing, especially when
you're first getting started.
So, you know, they say, youknow, if you're, if your basketball
team's behind 20 points in thegame, there's no 20 point shot.
You just have to keep hittinglayups, just keep hitting a layup,
(12:40):
keep hitting a layup.
And so we just went step bystep, hit milestones, made some promises
like we're going to try andget to this milestone and then we
do.
And then, okay, let's raise alittle bit more money and then let's
hit this milestone.
And you have to just have tobe patient, really patient and methodical.
There is no 20 point shot.
Okay.
And you know, as youmentioned, you're working right now
(13:02):
on expanding outside of yourlocal area.
I mean, for, for your nextlevel of expansion.
What, what do you see as acritical milestone that, that Circles
would need to achieve?
Well, I'd like to see realgrowth and retention outside of the
communities that we focus onmore exclusively.
(13:23):
That's going to be the real test.
So we've passed a few testsalready showing that we can scale
and retain people and stay positive.
So that's been really good.
We have, we have a chat withover 10,000 people in it and there.
And everyone's been positiveand really supportive of everybody
in the community.
So that's cool.
But getting into a city thatwe really have no presence in, you
know, that's going to takesome more strategy and that's where
(13:47):
we're going to really earn our paychecks.
That's where the rubber meetsthe road.
Can we, can we do that atscale in communities that have never
heard of us?
Okay.
And you know, based on your,your successful crowdfunding experience
with Circles, I mean, what doyou see as one, one important piece
of advice you'd offer toothers that are, that are early stage
(14:08):
startups and that are tryingto get investments on, on platforms
like we funder.
Well, I would have a couplethings going for you mission that
connects with people besidesjust the, the money, the return on
the investment.
Obviously everybody wants a return.
That's the whole point of investing.
So a clear plan of how you'regoing to exit, but also why you're
(14:31):
doing what you're doing.
The why is so much moreimportant than the how it really
is.
And if you can start with thatand then build your community based
on that, that philosophy, thenyou have a shock.
Okay.
Yeah.
And we hear that so much.
Right.
I mean, it's almost become alittle cliche.
(14:54):
I was actually just at aconference and they were bringing
up the find your why fromSimon Sinek repeatedly in terms of,
you know, the different brandsand whatnot that were there.
So I mean, in, in yourexperience, particularly on these,
these funding platforms, doyou see A lot of people where maybe
the.
Why it doesn't feel like, likeit's obvious in terms of the, the
(15:16):
founders or the, the brandscommunicating that.
I do see that a lot.
Yeah.
And, and I see a half heartedeffort, you know, to educate and
inform and enlighten theirpotential investor.
You know, if you go to aprofile and you don't grasp the concept,
then why would you expect themto invest?
(15:38):
So that really does need to becommunicated through your, through
your profile.
You know, you have a littlevideo you can, you can post and then,
and then descriptions.
And that's where your, yourinner soul, that's where the spirit
of you and your company shouldshine through.
And that needs to connect.
Ah, okay.
And how is your personalperspective on risk versus reward
(16:02):
evolved?
I mean, throughout yourentrepreneurial journey?
Being that this, you know,you're, you've been through numerous
ventures already.
Well, I don't know that Iwould have tried this if I knew how
hard it was going to be.
So I'm kind of glad I didn'tknow it was going to be this difficult.
The risk is tremendous.
(16:23):
As soon as you start takingmoney from people you don't know,
the, the stakes are so muchdramatic, more dramatically higher.
I mean, these are members ofmy community and the last thing I
ever want to do is let them down.
So reputational risk to me isreally far greater than the financial
(16:45):
risk.
I mean, sure, we'll lose a lotof money if this fails.
But reputationally, I don'teven know how I would be able to
show my face in the community.
I mean, there's thousands ofsmall investors in our community
and they're all counting on usand they're very supportive and it's
been great.
So that's why I work as hardas I do.
But if you're going to, to, ifyou're going to take money from investors,
(17:05):
you know, be prepared tochange your life and be accountable
and be transparent to them.
Because for me, at least forme, the reputational risk is, is,
is very, very significant.
It's something I take very seriously.
Okay.
And you know, reflecting onyour early days with Tech two, you.
I mean, what's, what's one keyinsight about it?
(17:25):
Building a successful companythat maybe you wish you knew sooner.
Don't spread yourself too thin.
You know, you have a goodconcept, get traction.
You feel like you can takeover the whole world.
Slow it down.
What's that expression?
Slow down so you can speed up.
I should have listened to that.
(17:46):
You know, it's 20 somethingyears ago, I was younger and thought
I would conquer the world infive years, but, you know, I ended
up spreading ourselves alittle, opening too many locations
too fast, and, and it ended upworking out, but it was 10 times
harder than it needs to.
And, you know, and putting usat the brink of bankruptcy more than
once.
And so don't do that.
Take your time and focus onwhere you're strong, and then when
(18:09):
you're really strong, thenmove to another one and then do it
again and again.
Don't just plant your flag allover the place.
Ah, okay.
So just balancing that naturalambition that, that entrepreneurs
have with, with maybe some,some realism in terms of scaling,
you know, at a moderate pace.
(18:29):
Exactly.
Okay.
And you know, John, given thatyou've been an entrepreneur for,
for 20 plus years and, youknow, been through numerous companies,
you know, and what, you knownow, what's one piece of advice that
you would, you would give youryounger self?
Well, the last statement, for one.
(18:50):
And then let's see, let's see.
I, you know, I'm really, Idon't have really any regrets, let's
put it that way.
I, I love the team that we've assembled.
Besides trying to scale toofast, I, I don't know that I change
much other than that.
(19:10):
I'd have to really think about that.
I think I've been fortunate tohave really great partners, and that's
probably something I learnedfrom a very early age, just from
smaller endeavors.
But you want to team up withpeople you can trust.
If you can't trust, there'splenty to worry about.
Starting a new business, tonsand tons of things that can take
you down.
(19:31):
The last thing you want iswork with somebody you don't trust.
I can't even imagine that wasalso a challenge.
So having really strong,reliable partners is super important.
I would just probablyreinforce some of those messages.
Okay.
All right.
And if people want to learnmore about circles and see if it's
potentially, you know,available in their area or coming
(19:52):
soon, I mean, what, what's thebest way people can, can find you
and reach out to learn moreabout the app?
Sure, sure.
Yeah, we're discoverable inthe App Store.
Just search circles with an SS I R C L E S.
We do actually have acrowdfunding campaign open.
You can check it out, get someideas for yourself.
We use the We Funder platform.
So if you want to check us outthere, we're we funder.com circles
(20:15):
and there's a campaign therewith lots of history, lots of really
valuable nuggets I'm sure youcould glean from it, and, of course,
our website.
So any of those sources.
Okay.
And we'll link all that in theshow notes for everyone.
All right.
Well, John, thank you so muchfor taking the time to be here, sharing
this wisdom from your journeyand the exciting stuff that you're
doing with circles.
We greatly appreciate it.
(20:36):
Thanks, Dave.
Appreciate you.
All right.
And that's all the time wehave for now.
We will see you next time.
Today, we're sitting down witha true visionary, John Worthington.
With over two decades ofexperience under his belt, John co
founded the thriving techrepair company Tech2u.
But his latest venture istackling a frustration many of us
share the often toxic world ofonline reviews.
(00:21):
John is the founder ofCircles, Spelled with an S, a groundbreaking
app built on the power offriend powered, positive only recommendations.
Forget sifting throughmanipulated ratings and negativity.
Circles offers refreshingantidote, connecting you with trusted
suggestions from your personal network.
(00:43):
In this conversation, Johnpulls back the curtain on the inspiration
behind Circles, the bolddecision to fuel its growth through
community crowdfunding, forwhich he raised an incredible $7
million, and the uniquechallenges of building a platform
that's centered on Positiv.
He also shares invaluablelessons from his entrepreneurial
(01:05):
path, emphasizing the role ofa clear mission and authentic community
engagement.
Whether you're a buddingentrepreneur, a small business owner,
or simply tired of onlinereview drama, you're in for a treat.
Get ready to explore a newhorizon of trusted recommendations.
As always, if you found valuefrom this content, please like and
(01:28):
subscribe.
All right, John Worthington,welcome to Beyond Fulfillment.
Hi.
Thanks for having me.
Yeah, absolutely.
We appreciate you taking thetime to be here, John.
All right, so let's get rightinto it.
So, John, what specificfrustration or observation, and perhaps
(01:49):
it was even stemming from yourprevious experience with tech2, you
what frustration ignited theinitial idea for Circles, and it's,
it's focused on trustedrecommendations, right?
Yeah, you know, it was acombination of things.
We.
Tech to you is a computerrepair business.
I started with a good friendof mine from college, started just
the two of us.
We have multiple locationsnow, over a hundred employees.
(02:12):
And you know, we, we have Yelpreviews just like any other small
business.
And we found over time thatYelp was not really pro business.
They act like they are, theysay they are, they promote themselves
that way, but the reality isthey're kind of a bully.
And you know, if you have afake review, you know, maybe a competitor
trying to attack you, whateverthe case may be, it's just really
(02:34):
hard to even get anybody to doanything at Yelp besides just send
you to their sales funnel.
And so it was really frustrating.
You know, we, you get a onestar reviews for something silly
like your lobby is too cold,you know, and there's no recourse,
but it makes your overallscore look bad.
Not to mention the fact westopped paying them at one time and
(02:54):
they filtered, quote, filteredout hundreds of five star reviews
and Then when we paid themagain, they magically showed up.
So we're like, there's got tobe a better way.
And we had this idea of, whyisn't there a place where I can just
see recommendations frompeople we know and trust?
I don't know of any app orwebsite where I can go just see my
friends recommendations.
Because I'd much rather hear arecommendation from someone I trust
(03:15):
than read reviews from strangers.
Attention, Shopify sellers.
Are you tired of slow sales?
Do you want to skyrocket your revenue?
Well, you'll want to join thisfree masterclass from my friends,
the Traffic Ninjas.
Learn how to optimize yourstore, boost conversions and dominate
(03:37):
your niche.
Sign up with the link in theshow notes and take your Shopify
business to the next level.
Wow.
Okay.
And you know, like, you justtouched on the, the established nature
of Vue platforms.
We all, you know, know whatit's like to, to at least use them.
I mean, what was the singlebiggest leap of faith you took when
(03:58):
deciding to, to pursue the,the friend powered model of Circles?
Well, you know, we're still asmall business at the end of the
day, so allocating resourcesis always a tough decision.
It's got to take a lot ofplanning and foresight and risk.
So that initial investment,you know, once, once you start down
(04:19):
that road, pretty soon there'sno turning back.
So hiring some staff, youknow, putting together a plan, developing
a concept and all that, youknow, it's going to take financial
resources, going to take ourhuman resources and our creative
capacity and all those things.
So making that decision andgoing forward with that, it's a really
tough decision.
It's a big, a big decision andkind of a life changing decision
(04:40):
if you decide to pursuesomething like that.
Because it's not going tosucceed if you don't put your life
into it.
If you're not obsessed, don't bother.
Okay, and why did you choosecrowdfunding through platforms like
Kickstarter and we Funder asthe primary funding method for Circles
(05:01):
in the early stages?
Yeah, and looking back, itseems like an obvious decision, but
at first it was a lot of debate.
Should we do crowdfunding?
Was that good, a good idea?
For us, it was kind of a newconcept at the time.
A few years ago, looking back,it was, it was perfect because for
us, especially the app thatwe're developing, Circles, it's spelled
Circles with an S, S, I, R, C,L, E, S.
(05:23):
It's really all about sharingthings with your circle.
And I trust recommendationsfrom My friends, I don't ask them
about five places they don't like.
I just want to know, hey,what's a really good restaurant?
Or what's a good movie you'veseen lately?
So going into that, we, wedecided that we're going to make
this app all about positivity,just because there's no, there's
(05:44):
no reviews in this concept.
This is all about recommendations.
So when we, when we firstlaunched on this idea, the idea started
developing first to just likekind of an anti Yelp kind of platform
of how we can.
What can we do to disrupt them.
But then real soon, werealized this is all about community.
And because it's your circle.
(06:06):
And so where Yelp, you don'thave friends.
On Yelp, it's not social.
But other social mediaplatforms, you know, obviously have
friends.
And with Circles, it's allabout your circle of friends.
So community and crowdfundingreally go hand in glove because crowdfunding
is about community.
If you don't build yourcommunity in crowdfunding, you're
(06:26):
not going to make it.
You really.
It's all about.
Because it's small investors,lots and lots of small investors.
It's not like a couple biginstitutional investors like the
traditional way.
So building that communitywith crowdfunding really good.
Went hand in hand with whatwe're trying to do because all those
small investors become loyalusers because they're invested.
Of course, they tell theirfriends and family, so there's.
It's more sticky.
(06:46):
So that whole communityconcept of crowdfunding, it just,
it made perfect sense as westarted really thinking it through.
And then from there it has.
It's really been just anoutstanding decision.
Probably.
I don't know where we'd be ifwe didn't do it.
We ended up raising over $7million in equity crowdfunding, one
of the highest of all time, actually.
So it turned out for usparticularly, like, just a perfect
(07:09):
fit.
Okay.
Yeah.
And, you know, like you said,you've done very well in terms of
the amount raised.
And being that it was, youknow, you weren't sure about that
at first.
Like, was there any specificstrategy that you, you used to.
To raise so much?
A few things, yeah.
(07:31):
Really building that communityis a big part.
You know, start with yourfriends and family and start with,
you know, we have customersand such and close friends and partnerships
and things around ourcommunity that we've already built
with our small business.
You start there.
And then we teamed up with areally, really powerful local influencer,
someone that has been on theair for many years in our community.
(07:52):
So, you know, he's got apretty trusted brand and reputation.
So partnering with somebodylike that early on, at least for
us, was a really good decisionbecause, you know, we're nobody.
Nobody has ever heard of us.
But if you have a partner thathas a bigger audience and also believes
in you, you're obviously goingto be able to amplify your message
(08:14):
a lot faster.
So that kind of strategy for,at least for us, again, it worked
really well.
Now we're trying to get out ofour local area, but we think we can
probably scale that withinfluencers that have more of a national
audience or internationally,so say.
So we're actually just now inthat phase of talking to people and
interviewing and all that.
Okay, and did you encounterany skepticism or resistance when
(08:39):
like, introducing the conceptof and shift shifting from anonymous
reviews to like personal recommendations?
Well, if anything, it's.
It's such a new concept thatpeople are like.
One of the number one things Ihear is, oh, what if I want to leave
a negative review?
And we're like, well, youknow, there are apps for that, but
(09:01):
we're about recommendations.
Again, I don't ask my friend,tell me five places you dislike.
It's, you know, I'm justtrying to get to the spots that,
that are good recommendations.
So we just, we don't do that.
So we built the app from theground up, deliver very deliberately,
very intentionally to be only positive.
Like a lot of guardrails inthere so that it stays.
Stays positive, which ofcourse is very refreshing right now.
(09:23):
We.
We get a ton of positivefeedback from our.
Our community.
You know, it always helps tohave a mission that people believe
in, which of course, circles does.
So that's helped us gain a lotof support just because of how negative
and toxic and how much dramathere is in.
In regular social media.
Even Yelp has.
Majority of their reviews are negative.
So being able to have acommunity that is looking for something
(09:47):
new and positive, that.
That's a big, big forcemultiplier for us that really helps
our network effect.
Yeah.
And you know, like you said,social media in general can be very
negative.
And I'm the.
There's an old adage,something about like, like a negative
review.
I don't, I don't know what itis exactly, but, you know, it'll.
(10:09):
It'll travel much faster interms of talking about what you don't
like versus.
What you do like, but it'slike 10 to 1.
Yeah.
For a negative comment.
Word of Mouth than positiveword of mouth.
Okay.
Yeah.
So, I mean, was that, was thata hurdle you had to overcome in terms
of people just adapting tothis concept of, oh, wait, like it's,
(10:30):
it's only, it's only something positive.
That's a great question.
And yeah, I would say kind ofindirectly just because not so much
that direct situation, butmore parallel to that, which is the
social media platforms thatgot popular exist today and grew
(10:51):
into huge companies.
They thrived on the drama.
They, it's that, that fear andanger emotion is so much more powerful
than the feel good one becausesame reason the word of mouth, the
negative word of mouth is 10times more powerful than the positive
word of mouth.
So same with us.
So we, our challenge more thananything is just keeping people's
attention because it's not,there is no drama and it, you know,
(11:14):
there's not that, that triggerthat makes you come back and want
to argue.
So it's a little, it's just aharder challenge to press the feel
good button for us.
But we're finding the formula.
Like there's a lot of reallycool things we're doing.
But yeah, it actually has beena challenge.
Like sometimes we joke like,oh, it'd be nice if we could just
open up, you know, wild, likecomments and like have people say
(11:34):
whatever, but, you know, it'sjust not in the spirit what we're
doing.
Okay.
And so given that it's, it'slike a departure from the norm and
it's a new idea and then, youknow, it's, it's a community app
with, with no negativity.
I mean, what was your nicheinitial approach to like building
the community and generatingenthusiasm like among the early,
(11:57):
early adopters?
We had to start slow.
You know, app development is,is really challenging.
It's, it's much harder thanlike building a website, for instance.
It's software development andpeople expect the app to be on par
with the best apps out therein the world.
And so that's a high bar.
So we really, we just startedslow with, you know, basic proof
(12:18):
of concept.
You know, obviously had a realsmall audience.
You know, friends and familystart with and they're very forgiving
of bugs and, you know, thingsare going to be wonky all over the
place.
And that's, that's normal forany app developing, especially when
you're first getting started.
So, you know, they say, youknow, if you're, if your basketball
team's behind 20 points in thegame, there's no 20 point shot.
You just have to keep hittinglayups, just keep hitting a layup,
(12:40):
keep hitting a layup.
And so we just went step bystep, hit milestones, made some promises
like we're going to try andget to this milestone and then we
do.
And then, okay, let's raise alittle bit more money and then let's
hit this milestone.
And you have to just have tobe patient, really patient and methodical.
There is no 20 point shot.
Okay.
And you know, as youmentioned, you're working right now
(13:02):
on expanding outside of yourlocal area.
I mean, for, for your nextlevel of expansion.
What, what do you see as acritical milestone that, that Circles
would need to achieve?
Well, I'd like to see realgrowth and retention outside of the
communities that we focus onmore exclusively.
(13:23):
That's going to be the real test.
So we've passed a few testsalready showing that we can scale
and retain people and stay positive.
So that's been really good.
We have, we have a chat withover 10,000 people in it and there.
And everyone's been positiveand really supportive of everybody
in the community.
So that's cool.
But getting into a city thatwe really have no presence in, you
know, that's going to takesome more strategy and that's where
(13:47):
we're going to really earn our paychecks.
That's where the rubber meetsthe road.
Can we, can we do that atscale in communities that have never
heard of us?
Okay.
And you know, based on your,your successful crowdfunding experience
with Circles, I mean, what doyou see as one, one important piece
of advice you'd offer toothers that are, that are early stage
(14:08):
startups and that are tryingto get investments on, on platforms
like we funder.
Well, I would have a couplethings going for you mission that
connects with people besidesjust the, the money, the return on
the investment.
Obviously everybody wants a return.
That's the whole point of investing.
So a clear plan of how you'regoing to exit, but also why you're
(14:31):
doing what you're doing.
The why is so much moreimportant than the how it really
is.
And if you can start with thatand then build your community based
on that, that philosophy, thenyou have a shock.
Okay.
Yeah.
And we hear that so much.
Right.
I mean, it's almost become alittle cliche.
(14:54):
I was actually just at aconference and they were bringing
up the find your why fromSimon Sinek repeatedly in terms of,
you know, the different brandsand whatnot that were there.
So I mean, in, in yourexperience, particularly on these,
these funding platforms, doyou see A lot of people where maybe
the.
Why it doesn't feel like, likeit's obvious in terms of the, the
(15:16):
founders or the, the brandscommunicating that.
I do see that a lot.
Yeah.
And, and I see a half heartedeffort, you know, to educate and
inform and enlighten theirpotential investor.
You know, if you go to aprofile and you don't grasp the concept,
then why would you expect themto invest?
(15:38):
So that really does need to becommunicated through your, through
your profile.
You know, you have a littlevideo you can, you can post and then,
and then descriptions.
And that's where your, yourinner soul, that's where the spirit
of you and your company shouldshine through.
And that needs to connect.
Ah, okay.
And how is your personalperspective on risk versus reward
(16:02):
evolved?
I mean, throughout yourentrepreneurial journey?
Being that this, you know,you're, you've been through numerous
ventures already.
Well, I don't know that Iwould have tried this if I knew how
hard it was going to be.
So I'm kind of glad I didn'tknow it was going to be this difficult.
The risk is tremendous.
(16:23):
As soon as you start takingmoney from people you don't know,
the, the stakes are so muchdramatic, more dramatically higher.
I mean, these are members ofmy community and the last thing I
ever want to do is let them down.
So reputational risk to me isreally far greater than the financial
(16:45):
risk.
I mean, sure, we'll lose a lotof money if this fails.
But reputationally, I don'teven know how I would be able to
show my face in the community.
I mean, there's thousands ofsmall investors in our community
and they're all counting on usand they're very supportive and it's
been great.
So that's why I work as hardas I do.
But if you're going to, to, ifyou're going to take money from investors,
(17:05):
you know, be prepared tochange your life and be accountable
and be transparent to them.
Because for me, at least forme, the reputational risk is, is,
is very, very significant.
It's something I take very seriously.
Okay.
And you know, reflecting onyour early days with Tech two, you.
I mean, what's, what's one keyinsight about it?
(17:25):
Building a successful companythat maybe you wish you knew sooner.
Don't spread yourself too thin.
You know, you have a goodconcept, get traction.
You feel like you can takeover the whole world.
Slow it down.
What's that expression?
Slow down so you can speed up.
I should have listened to that.
(17:46):
You know, it's 20 somethingyears ago, I was younger and thought
I would conquer the world infive years, but, you know, I ended
up spreading ourselves alittle, opening too many locations
too fast, and, and it ended upworking out, but it was 10 times
harder than it needs to.
And, you know, and putting usat the brink of bankruptcy more than
once.
And so don't do that.
Take your time and focus onwhere you're strong, and then when
(18:09):
you're really strong, thenmove to another one and then do it
again and again.
Don't just plant your flag allover the place.
Ah, okay.
So just balancing that naturalambition that, that entrepreneurs
have with, with maybe some,some realism in terms of scaling,
you know, at a moderate pace.
(18:29):
Exactly.
Okay.
And you know, John, given thatyou've been an entrepreneur for,
for 20 plus years and, youknow, been through numerous companies,
you know, and what, you knownow, what's one piece of advice that
you would, you would give youryounger self?
Well, the last statement, for one.
(18:50):
And then let's see, let's see.
I, you know, I'm really, Idon't have really any regrets, let's
put it that way.
I, I love the team that we've assembled.
Besides trying to scale toofast, I, I don't know that I change
much other than that.
(19:10):
I'd have to really think about that.
I think I've been fortunate tohave really great partners, and that's
probably something I learnedfrom a very early age, just from
smaller endeavors.
But you want to team up withpeople you can trust.
If you can't trust, there'splenty to worry about.
Starting a new business, tonsand tons of things that can take
you down.
(19:31):
The last thing you want iswork with somebody you don't trust.
I can't even imagine that wasalso a challenge.
So having really strong,reliable partners is super important.
I would just probablyreinforce some of those messages.
Okay.
All right.
And if people want to learnmore about circles and see if it's
potentially, you know,available in their area or coming
(19:52):
soon, I mean, what, what's thebest way people can, can find you
and reach out to learn moreabout the app?
Sure, sure.
Yeah, we're discoverable inthe App Store.
Just search circles with an SS I R C L E S.
We do actually have acrowdfunding campaign open.
You can check it out, get someideas for yourself.
We use the We Funder platform.
So if you want to check us outthere, we're we funder.com circles
(20:15):
and there's a campaign therewith lots of history, lots of really
valuable nuggets I'm sure youcould glean from it, and, of course,
our website.
So any of those sources.
Okay.
And we'll link all that in theshow notes for everyone.
All right.
Well, John, thank you so muchfor taking the time to be here, sharing
this wisdom from your journeyand the exciting stuff that you're
doing with circles.
We greatly appreciate it.
(20:36):
Thanks, Dave.
Appreciate you.
All right.
And that's all the time wehave for now.
We will see you next time.
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