May 4, 2021 BACK
Chatterworks and ECFX
And Success Stories You Should Know
The May 2021 issue of the Pasadena Angels newsletter highlights courage and determination. First, we’ll open with a short preview of the companies that will present at the monthly meeting. Below that you’ll find an update on a social commerce company that’s making an impact (MagicLinks) and profiles of Christopher Hussain and Janice Orlando.
May Startups Presenting Tomorrow
ChatterWorks / chatterworks.com / Founder: Shafiur Rahman
ChatterWorks is an AI-driven Talent Sourcing and Engagement platform. They provide a Chrome Browser Extension and Web-App to perform custom searches across 300M profiles and improve project management functionality. Their solution is to give recruiters the Where, When, and How to Engage with candidates along with enhanced candidate matching from incoming job applications and their current databases of resumes being enriched by ChatterWorks.
ECFX / goecfx.com/ Founder: Dan O’Day
ECFX Notice is an Enterprise Notice Management System using Intelligent Automation to streamline the entire electronic court notice workflow with firmwide administration and analytics. ECFX Notice creates efficiency by intelligently automating repetitive manual tasks while providing the flexibility to maintain firm rules and culture. Electronic court notices are processed within seconds of receipt instead of the hours or days it may take with manual processing due to employee off-time or unavailability. ECFX Notice reduces the cost of processing electronic court notices by an average of 93%.
Company Profile - MagicLinks
Software with Guts
What do you call a startup with 7 employees after 7 years? “Patient?” If you’re being kind, maybe, but more likely you’d think: “struggling.” On the other hand, how would you describe a startup at the intersection of the creator economy and high-end lifestyle brands, one that’s cash-flow positive, getting ready to raise $10M and has grown revenue and staff in excess of 100% for the last two years? You’d say, “En Fuego!” - maybe with two exclamation points.
MagicLinks helps social media creators and influencers share products they love and earn income as their fans shop. Brian Nickerson describes it as a 3-sided marketplace: creators, customers, and brands. MagicLinks connects the creators to the brands so that they can earn a share of the revenue. But, MagicLinks is more than a behind-the-scenes e-commerce tracker. They’re leaders, which is interesting for a mostly-transparent layer of software.
Remember way back in 2012 when Groupon seemed hot, and Chippmunk was selling coupons? No? Yeah. It wasn’t that memorable. Pasadena Angels had invested in MagicLinks – then Chippmunk – but after the bottom fell out of that sector, Pasadena Angels investor Richard Chino took Brian aside and told him: “You’re not fundable. Either pivot or shut down.” It was one of those moments: the inflection point. Either become something new or cease to be. Brian’s courage would be tested. He had to separate from his co-founder. He had to forego a salary for a year and a half. He invested his own money, and then his family’s money. He took a different approach.
MagicLinks has always been “creator-first.” Recognizing that the entire virtuous cycle starts with the creator and their relationships with their viewers, MagicLinks intentionally made the creator the sole focus. After all, it’s the relationship between the creator and their fans that drives purchases. So, MagicLinks spent years making sure that it protected and nurtured that relationship above all else – above maximizing revenue, and certainly above promoting MagicLinks. That meant having the courage to turn down some brands. The result has been deep trust from creators, who are MagicLinks’ first customer… even though MagicLinks pays them.
Three years ago MagicLinks began building out its software capabilities for brands. Matching brands to influencers is more of a subtle art than you’d think. You want to match the brand’s customers and the influencer’s customers, but brands also want to grow their customer bases. MagicLinks is able to enlighten both sides about who their customers are.
And then there was COVID. More people were shopping online, and more people were at home all day where they could engage online. And then George Floyd was killed. In the middle of an online shopping frenzy, the world was shocked and didn’t know how to respond. MagicLinks, the silent partner in the middle, stepped up and showed some leadership, leading their brands’ response by declaring a “pause” and taking time to consider how to respond. MagicLinks made a commitment to having significant BIPOC representation – at least 30% of creators amongst all casted campaigns.
It takes courage to speak up when you don’t have a speaking part. In the end, it was a gift to the brands, who were searching for the right way to respond. It helped many of them who lacked a diverse mix, and that was an issue that many were having. It means that MagicLinks was providing leadership not just in society but in their brands’ approach. Those who came along with MagicLinks saw a shift. Make-up brands had a permanent change in skin tone mix.
Last year, Brian was inspired to take his company’s commitment to social good to another level and publicly document its commitment to society and the planet. MagicLinks became the first and only social commerce company to become a Certified B Corporation®, joining a forward thinking community of only 3,500 certified B Corporations globally. Additionally, they launched a partnership with 1% for the Planet which includes annual cash and in-kind donations to help support environmental causes.
MagicLinks is already profitable and growing, but even more capital can be employed. They’ve got more big ideas. Live shopping is taking off. They were named to the 2020 Inc 5000 listof fastest growing private companies in America. They expect to complete a $10M funding round later in 2021. And Brian got his first unsolicited call from a prospective investor yesterday. That was a nice milestone for a guy who was told to shut it down or pivot five years ago. And it was a fitting reward for the courage that it took to turn down brands, to forego a salary, to part with a co-founder, to pivot to a new model, to invest your own money, to speak up when no one else was and to lead on social issues. Courage has its rewards.
Founder Profile - Christopher Hussain
The Man Who Is Simplifying Applications
ADHD is the term for someone with boundless energy and no ability to focus. So, what do you call someone with boundless energy and the ability to focus like an electron microscope? “Entrepreneur” is the word in Christopher Hussain’s case. Even before he was an entrepreneur, he was an “intrepreneur” – innovating inside the companies he worked at from his very first job to the last one that preceded RealKey.
As a founder, Christopher has all the ingredients. He has been deeply involved in every aspect of the mortgage and real estate ecosystem for 20+ years. He’s got an instinct for innovation, which could equally well be described as a hatred for inefficiency. And, he’s willing to put in the time, effort, and energy for whatever is needed from the ground up through exit and beyond. And if that means learning to build his own server rooms or work through Christmas, well, he’s done it.
He’s also got some lessons from the school of hard knocks. The mortgage crisis was a big one. In 2008, Christopher and his wife were in New York on a well-deserved vacation when the meltdown started. They scrambled to find wifi to manage the situation remotely. They spent their whole vacation in a McDonalds, clinging to the wifi and eating McNuggets while the mortgage industry collapsed.
But he’s also risen from the ashes. He’s got a compelling force that drives him to do it better the next time. RealKey is his fifth finance-related endeavor. Each one was different from the previous – an advance in some way. The first foray was marked by being more detailed, more ambitious, more fanatically dedicated to the details. The second was about applying new technology and solving old problems in brand new ways that redefined the game. The third was all about streamlining and automating anything that moved. The fourth was an opportunity to design things on a clean sheet of paper, from the ground up, built for efficiency.
And then came RealKey. It’s a big bet. It’s all four advances at the same time. The vision of RealKey is to let the documents fill out the application. Why ask an employee to ask an applicant for information and then compare it to documents? That’s backwards. These days, all you should need is to get the documents and let them fill in the application. That can then trigger some additional requests, which can then lead the customer down the happiest possible path. Integrations along the way can facilitate the process even further.
Leave it to a guy who’s already changed a paradigm, has a fanatical attention to detail, hates inefficiency, is compelled to streamline and automate everything, and who works like he’s in second place in the Iditarod.
Member Profile - Janice Orlando
Are We Having Fun Yet?
Janice Orlando is. Sounds like she never stopped having fun. After I hung up the phone from our conversation, which I was surprised to learn went a lot longer than I’d planned, I thought: “That is one positive lady.” I also thought: “Wow, she must have an incredible tolerance for risk,” – not because of any financial risk, but because what she does for fun are some of the most dangerous hobbies a person could find.
And, she must have big hands, because she’s got her fingers in so many pies. She’s involved in a South African charity for orphans (Acres of Love), she’s an adjunct professor at Azusa Pacific University where she is Chair of the Founding Board of Innovation, she’s doing business development for a SaaS startup, Ardius, she’s on the executive board of directors for Pasadena Angels, she’s a cofounder of VentureTwelve , she’s on a handful of other boards and she’s an astronaut*. Where does she find the time?
Specifically, where does she find time to race Catalina 37s (sailboats)? The answer is: she waits for bad weather and then heads out at night to race other people who apparently also lack a survival instinct. Because snow skiing and scuba diving are too humdrum to be her only hobbies, I suppose.
After more than a decade in commercial real estate and a similar stint in aerospace manufacturing, Janice has spent the last several years in higher education, business development and startup investing. She gets involved from the very beginning seed rounds to Series B rounds of startup funding, but her focus is really more on the “resourcing.” She enjoys making connections, identifying what startups need to get to the next level and matching them with those resources. More than being an early investor of 40+ companies, she likes being an early advisor.
It’s a funny thing that startups often go in search of funding when what they often need is coaching. Something in our conversation made me wonder if Janice is in the funding business because it opens the door to being in the coaching business. Hearing her describe her involvement with students at the Business School and startups through the Pasadena Angels and VentureTwelve, I got the sense that she’s really in it for the opportunity to help them work on the problems of scaling the business. For her, it’s a privilege to have an insider’s view of a team that scales a business and a mountain of challenges.
The ACA says that it typically takes 8 years for startups to successfully exit, which means that a lot of them successfully exit well past 8 years. They never expect it to take that long. Lucky for some of them, they’ve got a really positive advisor in Janice. And, lucky for some of the five million orphans in South Africa, they’ve got a benefactor here in the states looking for ways to harness smart people here to help more children there.
*Technically, she’s not an astronaut… yet.
Angels in the Media
One of the biggest wins in VC history was realized by Sutter Hill on its Snowflake investment, which took nearly 10 years to come to realization, but WOW, was it worth the wait…
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Dave de Csepel
Chairman, Pasadena Angels