American entrepreneur Jeff Durso got his first web startup acquired right before the burst of the dotcom bubble. Then, he went on to build and exit a second startup. Today we discuss his founder journey so that you can better navigate your own.
Shaun Gold: Alright, we are back. I'm Shaun Gold, coming to you live from the 305, aka Miami, Silicon Swamp. And we are here for our next exit interview with the legendary and super awesome Jeff Durso. How are we doing, Jeff?
Jeff Durso: Hey, Shaun. How's it going?
Shaun Gold: I'm good. I'm happy you're here. I'm excited to do this. The principle behind this is simple. We're talking about your entrepreneurial adventure for 40 minutes to an hour without any fluff. We're not sugar coating anything. We're going to go from startup to exit. The goal is to go beyond the press releases and the social media and really understand the secret sauce of your success in order to educate and inspire future entrepreneurs. With that being said, are you ready to rock?
Jeff Durso: Awesome. Absolutely. Yes.
Shaun Gold: All right, so let's do this. So first introduce yourself and tell us about your background and your journey.
Jeff Durso: Okay, so my name is Jeff Durso. So it's funny, I got into the entrepreneurial space right before the web happened. So literally, when I was in my senior year at MIT, there was no such thing as a worldwide web. And by that fall, everyone was talking about the web.
Shaun Gold: Not to make you feel old, but just to educate everybody. What year specifically?
Jeff Durso: So this was 1994 when I graduated.
Shaun Gold: Wow. That was when I first heard of the movie Independence Day. I saw the trailer was coming.
"You could order a pizza online. They were like, "this is the future".
Jeff Durso: Well, there was sort of a pressure cooker of all these ideas. Something big was on the horizon. So when we would stay up late in the fraternity talking about ideas to take over the world, there were words like information superhighway, there were all these very big ideas, but the web hadn't come yet. And then when the web came, it was like a powder keg where everything just exploded all at once. And we said, this is the thing.
Shaun Gold: What fraternity stays up all night about ideas to conquer the world?
Jeff Durso: So that was Theta Kai fraternity at MIT.
Shaun Gold: Okay, sorry, before I get into it, I just asked, did they have parties?
Jeff Durso: Only on weekends. So the funny thing is, we were the oldest active chapter of the fraternity, so we would get visitors from all over the country on a Wednesday night. And when they were like, where are the parties tonight? We'd be like, you're going to come on the weekend? They were very disappointed.
Shaun Gold: Wow.
Jeff Durso: If you came on a Friday or Saturday, then we were just as crazy as anywhere else.
Shaun Gold: Okay, perfect. That's all I had to get through. Okay. Did it mean that they're up? That was a new one. Usually we were up in the frat trying to see whose father belonged to a law firm that could help us out of the jam. But in your case, you were discussing the next big thing, which turned out to be the Internet. Was there any member, maybe a pledge that was like, it's going to be a fad. No one's going to use it?
Jeff Durso: We did joke about the terminology "information superhighway". Sounded kind of ridiculous, like everything was people talking big puffed up phrases. But I think when the Web came out, when I saw you could actually… I think it was Pizza Hut in San Diego. You could order a pizza online. They were like, "This is the future".
Shaun Gold: So you're in the frat having parties only on weekends, being responsible. I'll just assume that your frat had the highest GPA on campus.
Jeff Durso: It was the lowest in fraternity history.
Shaun Gold: But that's the.0.2. All right, so you're getting out of 1994, and, you know, the Internet is just popping off. So what's the plan? What do you do?
Jeff Durso: I take a real job at a company called Sapien, which was a start up at the time. I think there were 40 people when I interviewed. There were 100 people by the time I joined. A year later, they're 200. So they were exploding doing client server work, but the elephant in the room was like, client server. There's this Internet thing that's starting to happen, right? So meanwhile, I'm working this job. Every weekend, my brother and I, and then a friend of mine from school would drive up to my grandmother's beach cottage in Seabrook, New Hampshire, just because we could get away. And on the wall, we would brainstorm ideas for taking over the Internet. And unfortunately, we never really took notes, so every week, it would be a new idea. And eventually, every idea we came up with would turn into a multi billion dollar company just not launched by any of us, right? We came up with all these ideas, but we couldn't figure out how we're going to take over the world. And finally we were like, picks and shovels, let's just start doing some consulting and see where it goes. So we launched a consulting company. We started out selling websites, but somehow we got our way into fintech and started doing bigger and bigger projects for companies like Thomson Financial and State Street. And things actually started exploding for us going into the.com boom.
"We came up with all these ideas, but we couldn't figure out how we're going to take over the world."
Jeff Durso: But then a very interesting thing happened. Like, we were doing pretty well at the end of the 90s, but we were feeling like, okay, we need to raise money. And there are two things we needed to do desperately going into 2000. We need to raise money, and we absolutely needed to go all in on it because.com is the future, right? So you literally had a notebook saying, go all in on. And that was going to be our strategy for 2000. And then somehow we had a meeting on March 10 of 2000. I remember the date because it was just going to be a second meeting with this company that was looking to acquire us. But we didn't take it too seriously. And it was supposed to be my brother and my partner, my other partner going because we didn't want the Durso brothers going because that was kind of weird. But my partner got stuck in New York, so he called me up and said, you need to put together a PowerPoint about selling the company. And so we brainstormed. We were like, all right, let's make it say 15 million, but let's try to get 10 million, but give them a bullet point to cross off. Basically, put like three bullet points and make one of them obviously ridiculous, and they'll cross it out, right? So I'm like "intellectual property". Like, we're a consulting company. That's absurd. So the third bullet point was intellectual property for $6 million, right? And fast forward a few hours later, right, as the Nasdaq is clocking in. It's high. We're in a meeting, and the CEO of this company is crossing out that bullet point that said 6 million. But he's like "Intellectual property? It's a consulting company." And my brother and I were sitting there like, "Holy shit". And so a moment later, he's like, yeah, we can do 9 million. And so my third partner is on the phone at this point, right? And we were stunned in silence because we didn't... Did someone just say $9 million?
Shaun Gold: How many Ls is that and how many zeros?
Jeff Durso: We need to figure that out. But here's what's funny. We were so stunned. I think he thought we were upset because we didn't say anything. We were kind of stunned. And then he came out with like, "or 10 million" afterwards if we were to go to the tape. It's like we were stunned, and I think that got us a million bucks.
"We were stunned, and I think that got us a million bucks."
Shaun Gold: Did you stay stunned longer? Maybe it would have gone up.
Jeff Durso: No, we should have just like, we should have learned to keep our mouths shut. But that was the weirdest time in the world because literally, the Nasdaq had closed at its high. And his exact words were, like "Our stock price just closed at 50 times revenue, so we could pay you five times revenue solely." And so I took the notebook. So our.com plans went away. Thank God. That would have been the worst. That would have been literally the Titanic strategy. Like, we were all set to go all in on Titanic in 2000, and somehow, thank God, we got out. Instead, we got acquired.
Shaun Gold: So you started this company or what year?
Jeff Durso: We started it seriously in 1995. And then 1996 was when we started getting some traction. Small website clients and then bigger. 1997 was when we got into financial services, and then we rode that for a couple of years.
Shaun Gold: So it was a five year journey. It was from starting to 95.
Jeff Durso: Yeah.
Shaun Gold: Okay, that's pretty quick. You know, especially for startups. That's extremely quick. So it's all good. You're having fun coming from the frat as alumni, maybe going back to parties. But in those five years, what were some of the challenges that you faced? Specifically, how did you guys live? What was the meal plan? What was the social life? What was going out? How did you live during this era? I remember, I had my first online business around this time, and I was using I think it was AOL websites. I was a fan of Tripod. I was a fan of Angel Fire as well. GeoCities. They were all the Geocities.
Jeff Durso: I have a funny story about that. So a friend of ours from the fraternity mistyped GeoCities one day. He, like, missed the "i", and it came up to an empty page, and he's like, huh? So he contacted GeoCities and he's like, hey, you guys should get this other domain too, because people could mistype it, right? And they never responded to him. So he bought it. He just bought the domain name and referred it to put some affiliate links on it. He was making, like, thousands of dollars a month for years until finally Yahoo sent him a letter suggesting that he couldn't do that any longer.
Shaun Gold: Cease and desist. Okay, we’ll see. Even a misprint. Let me type in Facebook with two B's.
Jeff Durso: And he literally said he had a business plan for, like, "I'll create a room of people who are just typing in website ideas all day long and see how they mistype them to see if you could get other typos"
Shaun Gold: All right, well, that's not sure that I do. It is a fun fact, but tell us about how life was.
Jeff Durso: Coming out of college, obviously your burn rate is not so high. So when you have a job, it's great. But then when we started leaving the jobs and there's three of us, we got to a point where it was just I was the only one working, but I was taking my salary and splitting the after-tax to all three of us, right. Until I quit full time. And then when I went full time, we were living in a cheap apartment. My brother was living at the beach at my grandmother's cottage because we could live there for free. He would drive down every day into our apartment, and we literally had a meal plan. Like, we would go out and find out when tuna fish was on sale and buy tons and tons of cans of tuna. We'd just be eating tuna fish all day long. The communication was funny because we got made fun of for this. So my partner Raj and I were in the same room, and we communicated all day via ICQ. We were, like, 6ft from each other.
"We would find out when tuna fish was on sale. We'd just be eating tuna fish all day long."
Shaun Gold: I saw that when I was at university. I would literally go to someone's dorm room, and very tiny, and they'd be both talking on AIM. They'd be messaging.
Jeff Durso: I'm like, you guys were, like, feverishly typing. So our third roommate was like, do you guys ever use voice? Do you guys talk to each other like you're in the same freaking room?
Shaun Gold: But it worked. Don't knock.
Jeff Durso: It was effective communication. But, yeah, we lived out of there. And the funny thing is, my brother was doing the cold calls, right? And on his wall, he had this printout of different levels of car. So if you make one meeting today, you get the Chevette. If you set two meetings, you get the SUV. And the top car was like a bright red Ferrari convertible, right? And he bought that car the day after we sold the company because he was so imprinted by that process of when he was doing cold calls, he used to every day try to push himself to get to the top car.
Shaun Gold: When you say cheap apartment, describe to me the living conditions, because I know founders today it's like, you can work. We publish these city guides. Where's the best place to work from your laptop? So you can go to Starbucks, you can go to this coffee house, you can go to the beach. But back then, WiFi wasn't a thing. You had to be plugged into the wall. So describe this working condition of an apartment. Did you guys have separate bedrooms? Were there bunk beds? Was there central AC? Did you have heat?
Jeff Durso: No, it was a decent apartment. It was great for us. Probably not as fun for our roommate. We had another roommate, and she was not part of the business. We were, like, taking over the whole living room with, like, folding tables and computers and wires, and we had a huge whiteboard that we put on the wall. And, like, it was an okay apartment for someone right out of college. You know, it was just a freestanding house. And I think we had, like, the whole second and third floor between the three of us. It was a good set up, but it was nothing extravagant.
Shaun Gold: What city was this in?
Jeff Durso: This is in Medford, Massachusetts.
Shaun Gold: Okay. I'm not familiar, but to anyone reading, shout out to Medford, Massachusetts.
Jeff Durso: Yeah, Medford was a great place to start the company.
Shaun Gold: Was it a cool ecosystem? Are there a lot of other startups there?.
Jeff Durso: Cool no, there was no ecosystem there. We ultimately moved. We got our first office in Wooburn, Massachusetts, which was a whole ecosystem. There are all sorts of startups and small businesses around there, so a little more vibe, but it wasn't quite the coworking kind of vibe of today, right? It wasn't quite organized, quite like it is now.
Shaun Gold: Yeah, I mean, the coworking vibe back then, I mean, I was around. It was like, hey, look. Here's a couch. You can sit on one end. I can sit on the other. Don't use the phone. We only have one jack. That's our business calls on that line, too. So you got the cheap apartment. You guys are even subsisting off tuna fish. Was it a seven day a week grind? Did you take weekends off? What was the schedule like?
"We would work and play, just all kind of mixed together."
Jeff Durso: It was funny. We were always working. It was a nice lifestyle because I would work seven days a week. But if it was, like, Wednesday, and I'd be like, hey, Raj, do you want to go see Independence Day? Right? We'd be like, sure. And we just go do that. We were single at the time, too, so we didn't have any responsibility. So we would work and play, just all kind of mixed together. If it was a weekend, I might be working, or I might be going to the movies or whatever. It all just kind of blended together.
Shaun Gold: Got it. I'm totally familiar coming from my world of the Nightlife ninja. So you got this. Got the cheap apartment, got the tuna. You have the schedule down, got the roommate that wondered "What the hell? Why is she living here?" So what were some obstacles you guys faced as you were scaling this up and essentially just doing this? 24/7?
Jeff Durso: Yeah. And I'm going to tell you this from my perspective right now. Our freaking mindset was the biggest obstacle because we were idiots. So we're out selling websites for $1,500, right? And after about eight months of this and dealing with just painful, like, like, collections on, like, a small website, on the last payment of a small website. And we're like, you know, I feel like we have bigger things in store for us. One day, we just sat down, and we're like, what if we charged $15,000 instead? I mean, it sounds silly. We added a zero to it. And so the next client we pitched, we walked in, and it was this catalog company called ELCOM that wanted to get on the Internet, right? And the guy looked at me… This is going to date it, right? But you go back to the mid 1990s, and we're like, like, "Yeah, we could put your catalog online, right?" And he's like, well, because everyone was saying, we'll put five products online for X dollars and six products for this, right? And I'm like, yeah, we'll just do the whole thing. No big deal, for 15 grand. And then on the drive back, I look at Raj and like, how big is their catalog, right? 7500 products, PDF.
But the thing is, that was the most amazing project ever, because I'm like, all right, we committed to this, we're doing it right. We would pull all nighters, like, pulling that data from a PDF or like an Illustrator file into a data structure. And they had a guy from their business at our office with us pulling all nighters with us right there. Shout out to Jim Corcoran if you're out there. He was right there alongside us doing this. And I just remember thinking, like, if these guys are this bought into this, then we're bought into it too, and we delivered it, and we put their entire site, we put their entire catalog business on the web in, like, early 1997. Huge competitive advantage for them because no one else is doing that. And you could go on. You could put products in there. You could even do the Amazon stuff "Hey, people who buy this also buy this." We just way over because in our mind, going from a $1,500 budget for so long to $15,000, imagine what we could do with all that money.
But really, we over delivered. Like, we delivered like, 100 grand worth of value and then put these guys online. But going back to your question, what was holding back? Well, then mindset, then we did a few more of these $15,000 projects, and we're like, well, that's not it yet. Then we did a $150,000 project for Thomson, right? Then we did a $1.5 million project, and that's when the business took off. So a lot of it was just opening up the possibility and realizing that we can charge more. It sounds silly, but we can add zeros if we think about value, if we think about what we're creating, because it's so easy to sell yourself short.
"A lot of it was just realizing that we can charge more."
Shaun Gold: Of course. I feel like a lot of founders these days, they don't know what to charge for their product. You really have to understand the market, and you really have to have this mindset, too, that you can't be your own worst enemy. It's about what the customer is willing to pay, what the market is willing to pay. And a lot of people want to price way too low. Some people don't want to price at all. Some people want to price way too high. And it's just a matter of experimenting to find that sweet spot to see, well, if one person is going to pay this and maybe somebody else will pay it, and then, oh, wait, we got five people paying it. Let's charge higher. I feel like when I was doing Nightlife, that would happen too, where it's like, no one's going to pay $10,000 for a VIP table. Wait, they are. Wait, other people are. So it kind of was a thing where it went from being like, $1,000 and then maybe $5,000. Then you get like 10,000, 15,000, 20,000, 30. Okay, so the market will surprise you.
Jeff Durso: It's two questions, right? Who'd be crazy enough to pay $10,000 for this and then be like, who'd be crazy enough to pay $10,000 for this, right?
Shaun Gold: Exactly. To have friends that would do it. And forgive me, I should ask this earlier. What was the name of the company?
Jeff Durso: That's its own hilarious rabbit hole. Originally it was WebStrat. Right? Because we were like "web strategy". Because everyone else is like, oh, we do this development, we're the Strategist, so we're Web Strat, right? But when my poor brother Sam heard too many people on the phone being like "web rats", we're like, all right, we need a new name because they're not hearing webstrat, they're hearing something that's not as good. And then we came up with the Open Enterprise Corporation. So we had this idea that sounded like a big company. And I remember we went to someone who's like a brand expert and they're like, well that's going to create brand confusion, right? And we're like, awesome.
Shaun Gold: Yeah, we don't want to be the Web Rats.
Jeff Durso: Yeah. So suddenly when we were Open Enterprise Corporation. Then we got oec.com. So my brother had as, he had the WHOIS page for Oec.com because another company had had an open environment corporation and had sold out and we're like, they're going to forget to renew it. So we kept refreshing every day. One day it was available, boom, he snapped it. So that elevated us because we sounded like a real company. We go to trade shows and be like, oh yeah, I know someone who works there, like Dave. Like, tell him I said hi. I'm like, yeah, okay. You know, it was just three of us eating tuna out of an apartment. But yeah, we'll go tell Dave that you said hi.
"Then we got oec.com"
Shaun Gold: Maybe Dave was there. That was the roommate's friend.
Jeff Durso: Yeah. So people had suddenly heard of us because we were the Open Enterprise corporations. Like, okay, that's cool.
Shaun Gold: Well, again, there's the whole "fake it until you make it". And I feel like, hey, if that's the case where people are like, oh, I heard of it, it's a great company because you don't say anything. I think you guys mastered that.
Jeff Durso: Yeah, the funny thing that happened too, is our website, like I wrote all the flowery copy for our website and I'm like, well, everyone's talking about the learning organization, right? How about the learning ecosystem? So I wrote this whole thing about the learning ecosystem, right, and some other big companies stole it a few years later. And I'm like, I've made it because some huge companies talking about they're like literally stole everything I wrote about this made up concept of a learning ecosystem. I'm like, okay, cool.
Shaun Gold: Well, again, you take it until you make it. You do what you got to do and you did it. You exited out within five years. But this was just your first exit, correct?
Jeff Durso: Yeah.
Shaun Gold: And we talked previously, tell our listeners and our readers. Tell us about the dream car. You have the dream car, but tell us about your dream car.
Jeff Durso: Oh, my God.
Shaun Gold: What do you do when you exit? What do you do? Well, you buy a dream car.
Jeff Durso: Yeah. So if I have to go back to spring of 1991, where like… So I went to MIT for computer science. I've been doing computers all my life, so I'm like, yeah, this will be no big deal, right? And I just had my butt handed to me in the biggest way. I was coming out of the computer lab. It's like 03:00 a.m. In the morning. I'm miserable. I'm like, oh, computer science is really hard, right? And I look over and there's a spaceship with steam coming out of it. I'm like, what the hell is that? And I walk up to it, and it's a black Acura NSX on top of the steam gate. And I'm like, whatever the hell that is, I need to have that. So ten days later, five minutes after selling OEC, I went to the Acura dealership, which I had been there when we had inked the deal. And I'm like, they have this car roped off. And they're like, yeah. They didn't think I was serious. So I'm like, as soon as the deal went through, I wired them the money for it and I showed up and they had balloons ready for me. Oh, good to see you. So I drove that car and I was like, that car? That was amazing. Sometimes you have expectations in your head and you're like, oh, you're going to be let down because your expectations are too high. That was the most incredible car I've ever owned. Even though my expectations are high, it blew me away for five years. It was like putting us every time I drove that car, it was like putting on a super suit. And a pro tip is my other car was a total piece of crap.
"Five minutes after selling OEC, I went to the Acura dealership"
Shaun Gold: The tuna mobile, right? That was the one.
Jeff Durso: Literally. My little brother had bought a car previously, and they wouldn't take his car on trade in. It was like three different colors of paint and ice rinks would form in the passenger side when it got cold out. So that was my regular car. But so for years, I would keep the NSX parked in a garage. And I felt like Batman. I could pull into the garage whenever I felt like it, pull out with the NSX, drive around for the day, and at the end of the day, drive home in my piece of crap car.
Shaun Gold: I feel like I'm not a car guy. Have you ever seen the movie The Wraith with Charlie Sheen?
Jeff Durso: Trovaro?
Shaun Gold: Yeah, that car. I feel like if I was going to have an exit… Because the Wraith is like, everyone likes Fast and Furious. And I was like, oh, I got to get this car. But I'm a Wraith fan. I don't know about cars.
Jeff Durso: That car was amazing. Yeah, that car was incredible. I looked it up recently. I forget now what car it was. It was some kind of modified yeah.
Shaun Gold: It was a custom-made car that I feel like if I ever have a major exit, I would have to get the Wraith car just because it's like the rarest car and people go like, what the hell is that? Unless they saw the movie.
Jeff Durso: Although for me, next time I'm going to get the 6000 Sux from RoboCop.
Shaun Gold: 5 miles a gallon or whatever. It's big. So what happened to the car?
Jeff Durso: There's a few things that happened over that time. So I told you that I discovered that you can get from Naples, Florida to Fort Lauderdale in under 43 minutes. Allegedly. Of course, right. If that happened. What would happen is I got one or two speeding tickets and then eventually that totaled up to eleven, and my insurance, which was originally when I first got the car, my insurance was like $2,400 a year. It was going to be $8,000 a year. So I got to the point where it was just like I was like inches away from losing my license from this car and my insurance was through the roof. So after five years I'm like, all right, it's time to move on.
Shaun Gold: It hurts me. Okay, so you had the car, you had the exit, but that was a long time ago. So what did you do in between after driving around and allegedly racing around the car? What was the plan?
"I worked for the company that acquired us, and then got bored and left"
Jeff Durso: Well, I think what happened was I worked for the company that acquired us for a while and then got bored and left and then was looking for something else to do. And my godfather was friends with someone who had a very large travel agency in New England who was seeing this trend that he was starting to get destination wedding clients. And so he wanted to introduce me to him. So I met him. He told me about this whole destination wedding trend. I had never heard of it, but he said that it was like 16% of all weddings. I'm like, all right, that's a big trend. And we started talking and it took me a while, but about a year later I said, okay, this is something that I could dive into. And so I ended up becoming the co-founder and CEO of Destination Wedding Travel. And then I saw the domain name Destinationweddings.com and they wanted $10,000 for it. So my partner freaked out. He's like, that's like so much money, right? So we're like "negotiate for it, right"? So I'm like, "All right". So I'm like, "Hey, $500, right?" And the guy's like, oh, "How about 10,000?" So I'm like, "$1,000". He's like "Hey, how about 10,000?" And then three or four times like this. And my partner's like, "Go back one more time." And I'm like, all right. I went back one more time to the guy, and I was like, "What are your wire instructions?"
Shaun Gold: We tried. We tried.
Jeff Durso: You know what I mean? Because if I'm like, at some point he's going to come back with 20,000 thousand if I piss them off, right? So we bought the domain name, and then it was weird. It created this weird, self fulfilling prophecy in a good way. So we put the banner down and said, okay, we're the category, basically Destinationweddings.com. Now we got some lead flow. I stumbled into the direct response marketing world and started learning about that. And then next thing you know, the company started exploding. I would say that and say before it exploded because you want the guts, right? You want the truth now, right? Okay.
Shaun Gold: Yes, of course I want the truth!
Jeff Durso: All right, so let's go back to the truth. So when we sold OEC, I had a big blind spot, because what I learned is that if I program a piece of software… Because, like Thomson Financial, we would write in a piece of software in, like, six weeks or two months, and it would be making millions of dollars of revenue within a matter of months. So in my mind, I'm like it's. Like Barry Manilow. You write the songs, right? You write the program, and then boom, it makes a lot of money. It didn't occur to me that maybe Thomson Financial had all of Wall Street on their Rolodex ready to speed dial whenever they came out with a new product. So that's what I learned at DestinationWeddings is like, oh, no. Marketing, right? So we built this website, and now what do you do, right? So we tried to go to trade shows. I spent the whole day at a trade show with all these we got zero leads out of a trade show.
In my mind, marketing was something that people who are artistically oriented do.
Shaun Gold: Did you have a booth?
Jeff Durso: We had a small booth. We had pictures. We had a lot of brides come up to us and say, "Oh, that's really cool. I wish I had thought of that." So we were too late, and the DJ next to us made a ton of business. We made zero leads. So then we got out there and I said, okay, well, what do I do? I stumbled into a guy named Perry Marshall who was sort of the forefront of Google pay per click advertising. And in my mind, marketing, it was something that people who are artistically oriented do. It's not something that engineers do. And I met this guy, Perry Marshall. I'm like, oh my God, he's an engineer, and he's good at this. Maybe I can learn it. So I studied from him. I went out and spent like I bought every, for lack of a better word, "get rich quick" direct marketing training course I could find on the Internet and absorbed as much as I could. And next thing you know so I talked to Perry and he's like, you need a sales letter on your website. I'm like, that's crazy. It's like, trust me. I'm like, okay. So we wrote this, like 3,500 word sales letter. So picture, all of our competitors have these beautiful websites of brides, frolicking and the beach. Look at this amazing picture. And we write this infomercial style website. Like, what if your destination wedding is a disaster? Don't let that happen. It literally went down this path. So here's how we do it to make sure it comes out right. And then at the end it said, okay, give us $50 and we'll get started with you. And next thing you know, we start getting $50 deposits and then we start getting more, and it's getting lots of them. And so for years, we're building this company. All our competitors are looking at us like, "What's this cheesy looking website with this get rich quick style infomercial sales letter? Nobody's going to respond to that", right? And meanwhile, we're just killing it. So we somehow flew under the radar screen while getting tons and tons of business because we were responding to things that we had sent a survey out and asked, "What are your big concerns?" And we were answering those concerns and building our business around solving those real concerns instead of saying stuff like, oh, it's your important day and it's going to be special. Which anyone can say that we were saying, well, hey, this is a real stressful thing, here's how you solve that?
Shaun Gold: What year was this when you started destination weddings?
Jeff Durso: So yeah, we started talking about it in 2002. We got serious about it end of 2003, 2004. And then we kind of took off. I think we were on the 2008 Inc 500. So that was kind of like 2003 and 4 were like our first kind of qualification year. And then we kind of took off from there.
Shaun Gold: And you self funded it?
"We wasted nine months talking to investors. I could have just rolled my sleeves up and built it."
Jeff Durso: We did for a while. And again, because I'm supposed to tell the truth, right? So we were like, we went to raise money and we're like, this will be easy, right? Because I just sold the company for $10 million and my partner had this huge travel agency. Like, how hard could it be? So we put a pitch deck together. We spent nine months talking to all these investors, and now they're rolling out the red carpet for us because they don't want to tell you no, right? That's a pro tip. Like, investors aren't going to say, "Oh, that's a terrible idea". Think of like, that's great, because just in case, right? So we had all these people like we talked to all these investors that thought it was really good, but none of them funded us. So we wasted nine months. And then I called my partner, I was like, "I could just build this stupid thing". We just wasted nine months. I could have just rolled my sleeves up and built it. And so we're like, let's try that.
So that was like, late 2003, and I spent about two months building the site. Then we launched it in 2004, and then we were off to the races. So we eventually raised money in 2005, but at that point, the tone was different because we already had a business model, we already had traction, we had momentum. So I was leaning into the investors because they'd be like, you know, you put a dollar in here, and $5 comes out here. That was very different from our first pitch, which was like, oh, look at how great we are, and look at how great our team is. And they could kind of read between the lines the first time we were pitching that we weren't all in yet, if that makes sense. And that killed everything.
Shaun Gold: That's a major thing we need founders to understand is that I see a ton of decks, and here at OpenVC, I mean, there's so many decks come through, and it's great you have a team, and it's great you guys think you're awesome. You probably are awesome. But at the same time, we're investing in the business. So where's the business? Where's the metrics? Where's the traction? Where's the sales? Where's the revenue? Where's the product? Where's something? So I think what you went through is I feel like a lot of people are going through because a lot of people are just basing it on here's a deck, and here's me, let's talk, let's do it. Especially now, people are going to say all investments to some extent are gambles. Is it going to pay off? And if it does, is it going to be a 10x, a 50x, 100x? So I want founders to understand that it's nothing personal against you. It's just you have to come fully loaded. If you want a complete stranger to invest millions of dollars into you and your business, you have to come with a fully loaded deck. So I'm glad you shared that with us. So you raised in 2005, and how many years did you do destination weddings?
Jeff Durso: So I did that through, I think, 2008 or so.
Shaun Gold: Okay. And that's when the second exit occurred.
"I architect jobs. I never create something for myself."
Jeff Durso: So the exit occurred a few years after that. Okay. So I left. I kind of became an advisor in 2008 because I'm a founder, right? So I architect jobs. I never create something for myself. So I sort of built out all the components of the company, built out the marketing, built up the technology, brought the CTO, and brought the operations and all that stuff, and got to a point where I was like, I want to go do something else.
Shaun Gold: Got it. It was in 2010. So you spent 2002. You were thinking about it. 2004 is when you really got into it. And then six years. So first startup was five years, second startup was six years.
Jeff Durso: Yeah, about that.
Shaun Gold: Okay, so that's another point I want to reiterate is that it's not "We did it. We sold it within six months."
Jeff Durso: No. Yeah, exactly. There's a backstory to the overnight success right.
Shaun Gold: That most people don't realize and most people don't see. How was the DestinationWedding? Did you go to any to oversee? Did you put yourself in Bali? Be like, I'll be there personally.
Jeff Durso: My wife and I had a destination wedding. I didn't use this phrase with my wife. I didn't say, like, we should eat our own dog food. I think I said, hey, why don't we have a wedding? We went to Florida. It wasn't quite as exotic as some of the other places, but I traveled to a lot of the places. Doing sight tours was pretty awesome. Like going to the Bahamas and having, like, limos taking us to all these amazing places, like being put up in Atlantis for free and stuff like that. So I get to see a lot of places. But for me, I knew I had arrived when I happened to be on vacation in Mexico and I saw a DestinationWeddings wrapped van show up. And I'm like, that's making it, right?
Shaun Gold: They probably know your coworker. Where's John? I heard of you. They probably knew him. Quick question: when you and your wife did it, did you put the $50 deposit down or did you make her do it?
Jeff Durso: Oh, man, that's a tough question. I'd have to check the records to see if we ever paid the $50 deposit.
Shaun Gold: "I know it's my company, but we have a process we have to go through."
Jeff Durso: I just violated… Even Elon probably pays for his own cars, and I think I went in for free unfortunately,
Shaun Gold: I'm not only the president, I'm also a customer. All right, so what was the second exit for the amount, if I could ask?
Jeff Durso: That was in that same range, about $10 million.
Shaun Gold: Was there a pause when you got the call, or would you just "I'll take it."
"And then at 03:53 P.M., a wire transfer came into my account."
Jeff Durso: The story around the final part of the exit, because there was a lot of back and forth. We had a ton of individual investors involved in the process. So this was before DocuSign. It would have to be faxed to someone's boat to sign something on their fax machine or whatever works on a boat. I don't know. I'm not sure what the fax yacht networks are, but some of our investors needed to sign things. And we had this one deadline that was like February 28 at 05:00 p.m.. That was like, way out in the distance. It didn't matter. It was one of those deadlines like, yeah, that doesn't matter. So far out. This thing is going to be closed early February. So that date doesn't matter, right? Until suddenly it does. So I remember February 24. We're starting to sweat it like right? And then February 25, it was definitely going to close. This is a Friday. The Delaware Secretary of State's office makes a typo in some form, right? And it blows it for that day. Now we're going into February 28. I remember that day, my Angry Bird skills went through the roof because I was like… You ever see that movie Crimson Tide where they're like, they're on the sub, they're fine. But then when the point where there's nothing you can do is like you just have a nice chat. The only thing I can do this day, I literally played Angry Birds all day with my son. That's literally the only thing I can do today. And then at 03:53 P.M., a wire transfer came into my account.
Shaun Gold: Oh, well. It was like Crimson Tide.
Jeff Durso: Literally an hour and seven minutes. Because if it had gone past that… There's so much emotion wrapped up, but the amount of paperwork required, that would have blown up the deal because everything would need to be rewritten and redone. It would have created a month-long pause in a deal that didn't need that kind of momentum killer.
Shaun Gold: Understood. So we closed the deal. You got the high score in Angry Birds. That's your second exit. And I have to ask, what have you done since? Has there been a hat trick? Lucky number three?
Jeff Durso: Not on the exit front, right. It's interesting. The thing I'm most proud of is not financial. I started a company about eleven years ago called Native Brain to build an app to teach number sense to five year olds, six year olds, right? So my partner in the company had gotten his doctorate in education and was telling me about this research that could theoretically change the way kids learn, but there was no way to do it. And we're like, I wonder if the iPad changes everything, right? Because the iPad had just come out. And so we spent a year just literally programming this thing together. Like, he and I spent a year building it and had a team building it and launched this thing into the app store in October of 2012. And all the critics are like, this is amazing. This is the best curriculum we've seen. We were charging anywhere, but we started at $10, moved it to $3, and we weren't selling a ton, but the critical review was like, everyone loved it, but teachers had trouble getting it because teachers have trouble spending a couple of bucks, but if it's free, they can get it. And here's where the story gets interesting. So at one point, we're like, okay, there's some free App Friday promotion. We're like, let's try it just to see what happens. And so we signed up for it. And you agree to make the app free for one day, and then this company promotes your app on that day to a bunch of people who are looking for free apps, right? And I'd kind of forgotten that we had done it for this Friday. And I happen to be going to a conference in San Diego this Friday. And I get off the plane, and my phone is blown up with text messages from my partner that are all like, WTF. Oh, my God. Holy you know, like, all these texts. And I called him up. I'm like, Why don't you just tell me what's going on? Because I can't follow the thread. Yeah. And he's like, open up the app store. So I opened up the App Store and went to the education section. Our app was number three. So it's like iTunes University, Mickey's clubhouse and then us. Then that night, we beat Mickey's butt.
Shaun Gold: Take that, Mickey.
Jeff Durso: We took Mickey down.
Shaun Gold: And Pluto, don't know what you are.
"We were number two in the App Store"
Jeff Durso: Yes. So we actually ended up number two. And we were joking. We were like, obviously, the algorithm says just pin itunes University at number one, no matter what the downloads are. So we were like, the number two in the App Store. So tons of downloads that day. We're like "That's interesting". Then we made it paid again, and we tried another free App Friday. Same thing. So at some point about nine years ago, we're like, okay, we're kind of a no man's. We have to decide. Do we kind of keep trying to sell this, or do we like to see if we can make an impact? So we just made it free, and it's just exploded ever since. So we've had over 700,000 kids use this. Tons of teachers texting us, emailing us, saying all these amazing stories about kids who are struggling with math, who love the app. Like, some kids with a serious case of ADD, and they could sit down with our app and just focus on it for 20 minutes. So we're like, what was amazing to me, like, my partner had this theoretical view of, like, this could work if we did this. To see his vision come to fruition after all of that hard work together was just amazing. And so to get that impact, I would say I'm more proud of that in terms of an outcome, or even though it wasn't a financial outcome, to know that all these kids have learned number sense because of what we built together. That's one of my favorite things that I've ever worked on.
Shaun Gold: Well, it's really wonderful because most people talk about impact. There's always some stupid investing term or startup term that does the rounds every eight months. It always comes out and it's like, we're going to do impact. We're going to do impact. But nobody ever has any impact. It's just a buzzword to make them look cool and feel special or a hashtag. But you actually built something that has impact. The metrics don't lie. This is just close to a million kids who have been helped. It's fascinating.
Jeff Durso: One of the craziest stories that ever happened when you kind of go into the details. We had a teacher reach out to us and said, the graph crashed on my computer. And I tried to pull up some kids. There was a little graph. You could see the kids progress. And so I tried pulling it up and it crashed. I was like, that's weird. So I look up. Now, usually one of these activities in our app, a kid who's good at, like, really, who already mastered, can finish it in 58 tasks. Like, take 50 tries, and then someone who's not as good might take 200 tries. This kid had taken like, 2500 tries on this one thing.
Shaun Gold: Did he get it at the end?
Jeff Durso: So that's the thing, right? So I'm like, here, I'm like pulling Excel, pulling the raw data to try and create this graph, and I'm falling along the story and he's like, stuck. We go from zero to five stars, right? His line is like, stuck near zero, zero, zero for a long time. Then it starts creeping up. Then it creeps up. Creeps up. When you look at the last 50 tasks of his, overlaid against, say, a kid who's good at math, they're the same graph. This kid freaking mastered it. And he looked up at his teacher crying. She told us he was crying. He's like, I did it. That kid figured it out. That's like my most exciting story about the app. I'm like, wow, this kid crashed the graph, but figured it out. He got it just like the other kids. He mastered that activity.
Shaun Gold: Well, it goes to show there's a saying that you shouldn't punish people's multiple failures. You should praise their persistence.
Jeff Durso: That kid was the best and shout out to him. He's probably going to be a rocket scientist soon, so shout out to him because that's the most persistent child I've ever seen.
Shaun Gold: So we talk about impact. We talk about what you've done on both sides. You've had successful exits. You've built this company that didn't exit, but it's personally fulfilling. It actually has added a lot of value. Not to diminish the website, not to diminish the destination wedding, but this is something that you feel proud of. What do you advise founders right now in their building? Should they focus on personal fulfillment or should they focus on becoming the next trillionaire? What do you think is the best path for them to follow?
"Money, freedom, and impact are the three things that you want to steer towards"
Jeff Durso: Yeah, I think "both" is probably the simple answer, but I think there's a way to think through, like, I hate to break it down to KPIs. But there's someone who said money, freedom, and impact are kind of the three things that you want to steer towards over time, right? So you need to make money or you don't get a chance to take these swings at the bat. So I was able to do the native brain because I had had some prior exits. Like, otherwise I wouldn't have been able to spend a year not making any income putting all my effort into this app, right? So you've got to create money for sustainability. But I also think there's a diminishing returns line right past that. So I look at my parents, for instance, my dad retired when he was 47. My mom was 48. They did pretty well, but not super wealthy, right? They had friends that owned private jets, so they would be like, those guys are richer. But instead my parents were like, okay, we've done well enough. And they, you know, took over a local Habitat chapter and turned it into the most productive chapter in the world. So they were the number one chapter. And so I looked at that and I was like, that's freaking inspirational, right? And all of their friends, they had friends who are like I said, who had real serious money, right? They were all coming to volunteer for Habitat. Like, they were looking at this, wow, these guys have really found their purpose.
So I think you have to understand diminishing return lines, right? So, like, what's your, what's your ultimate goal in life? So I look at like, I love what my parents did because they made enough money to retire pretty young, but then oddly ended up working twice as many hours after that. My parents are both working 70, 80 hours a week because they were so into the mission of what they wanted to do that they really believed in. I'm like, that's really cool to be able to do both of those, but they could only do the second thing because they succeeded at the first, right? Because sometimes you hear about people volunteering straight out of school and it's like, well, you don't have a lot to offer the world. I mean, that's the wrong way to put it, but you know what I mean, you don't have a huge impact. Build up your capacity and then give back because now you're giving back at a much higher level. I think it's sort of the lesson I would say.
Shaun Gold: Got it. And I do have one last question, because right now in this world of distributed teams and Zoom and Google and whatnot you lived with your first company, you guys lived in the same house, the same apartment, I mean, you did it. Do you think a founder and founding teams right now, do you think they have to be together and work in the same city and cowork in the same place? Or can it be distributed? And can they do it from wherever they're located or do they have to go to a hub? Do they have to go to Silicon Valley? Do they have to go to New York? What's your opinion on it?
Jeff Durso: I think it's a tough challenge. I mean, I can tell you my working opinion on it because the real answer is not going to come out for another five or ten years, right. When we have enough to look at it. But what I've seen that seems to work is like so I think that you need to have, if you're going to be remote, you have to get together in person at least say like once a month, once a quarter at the farthest. But you need to get those bonding times in person, and then the rest of it you can do remotely. Right. So, for instance, about five years ago, I did a business with my brother and another partner there in Florida. I'm up in Boston. I would fly down there probably twice a month. And a lot more when it got cold out, but that seemed to work. The in-person thing is I feel as good. The only way to get the real bonding there's a speed limit on the bonding you can get from virtual.
Shaun Gold: Got it. Well, that's all I have to ask. I learned a lot today about 90s websites, which I live through, destination weddings. I mean, there might be a whole market for destination divorces. Think about it.
Jeff Durso: We always said because we said because people are like, what's your long term what's your customer LTV? It's a buzzkill for us to tell them that we want more than one transaction. Right. We didn't want to send them a postcard seven years later and be like, hey, statistically speaking, you should be ready for another one of these. Right?
Shaun Gold: Well, depending on the city, you could be ready for the third. So I want to thank you for being here. I mean, you have a really fascinating journey. We interview founders from all over the world, and everybody's story is unique to them. It's their own personal founder story, and each one of them is inspirational in their own way. And this one was just super fun because you understand the Wraith. I'm going to put a picture in the article of the Wraith.
Jeff Durso: You need to look it up, because somewhere on the Internet they talk about what that car is because there is some kind of cult following for it.
Shaun Gold: Oh, and it should be. It's the coolest, at least in my opinion.
Jeff Durso: No, it still is. It still is like 35. Yeah, it's still one of the coolest looking cars.
Jeff Durso: Not the opinion of OpenVC or anybody else. My opinion. I still think it's one of the coolest cars in a movie that people are like, what? Take a break from building your startup, take a break from looking at term sheets and watch an hour and a half of the cheesy glory that is the Wraith.
Jeff Durso: Absolutely.
Shaun Gold: You will enjoy it. All right. Well, Jeff, I want to thank you for being here. I want to thank you for taking the time. If there's any links you want us to drop, we will drop the links. You have your own podcast, too, if you want guests. I was on the podcast. Absolutely had a blast. You also love appearing on podcasts, so if anyone out there needs a really awesome and a really fun guest, look no further.
Jeff Durso: Yeah, I'm a huge podcast junkie, so I definitely would love to be on other podcasts. And my podcast is Founder Breakthroughs. You can go to founderbreakthroughs.com and get the links.
Shaun Gold: Awesome. All right, that's it. I'm Shaun Gold. Thank you for joining me.
Jeff Durso: Thanks for having me.
