February 28, 2023 BACK
This month, after a brief summary of the companies presenting and providing updates on Wednesday, you'll find the story of EventHub and a profile of a Pasadena Angels member Don Hall.
Presenting This Month:
PrivacyHawk, with Aaron Mendes
iPourit, with Chris Braun
Lynx Bio, with Chorom Pak
Beyond4 (Your Fare), with Christopher Monk
Featured in this issue:
EventHub (with Michael Bleau)
Don Hall, Pasadena Angels Member
Startups Presenting Wednesday,
Location: Los Angeles, CA
CEO/Founder: Aaron Mendes, CEO
PrivacyHawk is a consumer privacy app that is creating the Personal Data Management category. Backed by TCA, FFVC, Gaingels, and Duro, and based in Los Angeles, PrivacyHawk empowers everyone to take back control of their privacy. The app currently performs 3 valuable functions: 1) Identifies who is using or selling your data 2) Gives control to manage how it's used (or delete it), and 3) Monitors for ongoing privacy risks and protects your personal data..
Location: Lake Forest, CA
CEO/Founder:: Chris Braun, CEO
We provide self-serve beer and wine system that allow patrons pour and pay by the amount they pour, improving operator profitability by an average of 39% for Bars, Taprooms and Restaurants and provides an ROI of less than 6 months for the operator.
COMPANY: Lynx Bio
CEO/Founder: Chorom Pak (via Zoom)
LynxBio's technology uses a standard-of-care biopsy to measure patients’ live cancer behavior and response to multiple drugs in the context of its natural environment.
COMPANY: Beyond4 (Your Fare)
CEO/Founder: Christopher Monk (in person)
Beyond4 is an online ordering management software that streamlines the 3rd party delivery services like GrubHub and DoorDash into one simple platform.
For EventHub, A Marathon is More Than a Metaphor
Some of Everyset's growing list of productions supported.
Michael Bleau and Jamie Nassar stumbled into an unserved market almost eight years ago when they worked in event marketing. They formed EventHub and started the long climb to building a two-sided marketplace matching event organizers with all the vendors who fill convention halls and promenades at the end of marathons and 5Ks. And, things were going pretty well in 2020 when COVID suddenly slammed the door on public events.
Back in 2014 Michael was doing event marketing - running experiential marketing tours with a branded vehicle, giving away samples and collecting lead data. When his company had an absence, he stepped up and started booking his own events, saving the company thousands. So, they expanded his role, and with that new experience, he had an epiphany. He and Jamie, who also worked in the field, conceived of a business that would dramatically streamline and improve the way events were organized.
Putting on an event is, in many ways, like creating a whole company. Organizers hire everyone, plan everything, design the logistics, build the structures and source everything from utilities to bathrooms, and then it operates for a few days at most… and then they tear it all down. It’s organizationally intensive.
Jamie and Michael felt the pain of the manual nature of the business. Organizers have to somehow find vendors to fill their events. There are contracts to sign and liability waivers and instructions. There has to be a way to choose a booth location and make payments, and there are tons of details that need communicating, and it was a logistical nightmare. And, many booth operators are mom-and-pop operations without a lot of sophistication.
EventHub is a two-sided marketplace where vendors and events can find each other, but the hook is the suite of tools that save each side so much time and effort. Forms can be found and signed online. Organizers can map their venues and vendors can choose their booth locations. Checklists keep each party on track, alerts let everyone know when things aren’t on schedule and communication tools save time calling and texting. Event organizers save literally hundreds, even thousands of hours depending on the event size, which translates into lots of saved money (and better events).
A few years ago Michael and Jamie participated in Techstars, and one of their big takeaways was that they needed in-house technology expertise. They eventually found their CTO Jerry Harrison in Myrtle Beach, SC, and he’s been building their infrastructure for several years. That proved to be critical when COVID crushed the events industry.
There are competitors to EventHub, but they focus on stadiums and charge significantly more. Whereas EventHub tops out at $10K for a large event, these other stadium-focused platforms charge $20K, $30K or even $50K. For smaller events, EventHub’s pricing is even more affordable, and the user-friendly design is appealing to events with unsophisticated vendors.
EventHub’s first focus was on races. They signed up the big ones: New York Marathon, Chicago, Los Angeles, etc. That translated into success in other races as word got around. Often those organizers also put on other events during the year. This year, the NY Marathon reported that they had multiple signups of vendors that they were unaware of - they just signed up on the platform - and the marathon made $50K in revenue with no sales effort.
Fairs are the next focus area, and EventHub recently signed up the largest state fair in the county - you guessed it - the State Fair of Texas. That’s helped build momentum with other fairs.
COVID was a massive threat. Every event was threatened with cancellation. But, there were two factors in EventHub’s favor: Sponsors had paid millions and event organizers didn’t want to give that back, so they were desperate for a virtual workaround. And, EventHub had a CTO and better capabilities. Within six months, they had everything from virtual goodie bags to breakout rooms with pre-run yoga. People were desperate to participate, and virtual runs turned out to be a thing that people would still participate in if the platform could accommodate it.
Recently EventHub launched a revamped buyer-side, making it mobile friendly and implementing a checklist style to simplify life for buyers. They implemented their first price increase since COVID, and it was well-received, which has helped revenue growth. This year’s focus is on generating consistently positive earnings.
Recently Michael heard the sweetest music a founder can hear. At the Running USA trade show, a race organizer approached him and said: “OK, I just had two vendors complain that I’m not using EventHub, and now I find out that the two other races of similar size in my state are using you guys and say you’re great. How do I sign up?” Those are the lyrics to the tune Network Effects, the sound of which can only be heard inside the heads of entrepreneurs and their investors.
Investing for the Long Haul
Don Hall grew up in a big family in the south, and after Sunday lunch at the grandparents, as a teen he used to sit on the veranda with his father and uncles and listen to them talk about stocks while they smoked cigars. The idea of making money “without doing anything” made an impression on him. It was a first call, which he followed without knowing it. Only years later would he remember and recognize the foreshadowing.
But, he had to explore some other paths first. Don studied engineering in college, and as part of that education, took a class on Engineering Economics. They studied bond financing for plant expansion and calculated present values and compound interest, and while he had used exponents before and understood the calculations, the implications dawned on him then: finance was fascinating.
Still, he persisted in pursuing engineering and became a Sales Engineer, and very soon he had his first opportunity to use his engineering skills. His best friend was getting married, and, just out of school, Don barely had any savings with which to buy a nice gift. He was ruminating on how to hustle up some extra funds when an ad came on the radio. There was a new bank branch opening, and they had a contest. There was a wheelbarrow full of pennies, and whoever guessed closest to the actual number of pennies would win the value of the lot.
You can picture this up-and-comer, this freshly minted engineer, this motivated go-getter. He had the skills, the smarts and the gumption to outwit everyone within earshot of that radio ad. He planned his raid. He brought string instead of a tape measure - that would be too obvious. He was subtle and wily in taking his measurements without attracting attention. He devoured the rules and learned them by heart. His plan was to apply integral calculus to the irregular dimensions of the pile in the wheelbarrow to calculate the volume of pennies. As he left the branch and contemplated step three of the plan, he looked across the street and saw a hardware store.
Bank branches don’t normally have their own wheelbarrows, so Don reasoned that they probably had to acquire the wheelbarrow, and while there are a lot of places to get one, the most practical location would be the closest. He walked across the street, and there in the hardware store was the exact same wheelbarrow for sale for $38. Don made his first investment and threw away the strings.
He took the wheelbarrow home. He took an empty orange juice container and filled it with pennies, noting the total. Then he took his wheelbarrow and orange juice container on the road looking for a pile of gravel. When he found one, he proceeded to fill the wheelbarrow with gravel using one orange juice containerful at a time, again noting the total. Returning the gravel and returning to his place, he proceeded to do a bit of arithmetic (not calculus).
It would have been reasonable to calculate the likeliest number of pennies and submit that number, but Don is not the kind of investor to accept risk when there are ways to eliminate it. He came up with a range of 10 guesses that he was absolutely certain would guarantee him to bracket the actual number of pennies in the wheelbarrow.
When the day came, Don sat by the phone in his office, amidst doubting and chiding fellow trainees, knowing that it would ring. The more his colleagues laughed at his prospects, the less he doubted he would win. First prize was (almost) a ton of money. Second prize was a $20 Polaroid camera. A concern entered his mind. What if he won first and second place? That might look bad. Anxiety built. Someone might be suspicious about one guy winning both prizes. He got nervous. The phone rang. He had won, but what had he won? $578.23. In the mid 70s that was a “pretty penny”. He returned the wheelbarrow and got his $38 back. He had enough for a wedding gift and then some.
Upon completing the training program at this manufacturing company, Don was placed in the Atlanta office where he soon began thinking about finance as a career. He started an investment club with friends and spent his free time studying investing and sharing his insights. He applied to HBS, which required him to play his favorite sport tennis indoors for the two year stint. After graduating, he was recruited to Los Angeles and took up residence in Pasadena, where he could happily play tennis outdoors year-round.
He began his investment career at a large firm ($300 Billion AUM) where he developed a system and philosophy of stock selection that the firm adopted. Eventually he started thinking about the next challenge. He had spent his career thinking about and analyzing large corporations, but there was this new Internet thing, and he had some theories about it. He lobbied his company to start a venture fund. That was well outside their core competency, and they wisely turned him down.
So, Don and two like-minded colleagues decided to jump onto a new learning curve. They started their own venture fund. After 18 years studying large caps, he was ready for a new challenge, and the opportunity was incredible. The Internet’s infrastructure was being built out to foster an unparalleled, historic opportunity for an untold number of new companies.
The thesis was correct, but his timing could have been better.
By the time they made their move, the dot bombs had started exploding, which complicated things just a bit. IPOs froze, and venture funding went into a “nuclear winter”. Undaunted, they prepared to launch their fundraising campaign. Don sat at his desk on September 10, 2001 with his finger hovering over the key to send his emails and start the campaign. But, being a prudent and thoughtful guy, he figured he would sleep on it one more night and launch the campaign in the morning. Unfortunately, he couldn’t get into his office the next morning because the world had changed since he’d gone home the night before.
As a result, their $200 Million venture fund target was not realized. They raised only $32 Million and that took 4 years. That was frustrating for a guy who had once raised $100 Million in a single meeting. It seemed that raising money was harder than investing it (at least at that time) because the fund eventually performed beautifully. Half of the 14 investments were profitable, and some extremely so.
Part of his enthusiasm for starting a venture fund was based on his experience as an angel investor. Around 2000 he made his first two angel investments, and both were successful, one remarkably so. After investing in another 75 angel investments he realized that he was more lucky than smart on those first two.
I asked Don what he learned from all those years of investing. “First,” he said, reflecting on his wheelbarrow full of pennies gambit, “don’t let a formal education get in the way of common sense solutions.” And, if you want to go a level deeper, Don boiled down his years of wisdom on public stock investing into 47 simple maxims, which are available here.
Don with his millennial offspring in Iceland, from left to right, Rosemary, Charlotte, (Don himself) and Parker.
February '23: Everyset (EB, Ebrahim Bhaiji) and Richard Chino
Nov '22: Cactivate (Wentao Xiao) and Gene Stein
Oct: C360 Technologies (Evan Wimer) and Kenji Funahashi
Sep: Woody Sears (Autio) and Mike Krebs
Jul: Open Sesame (Steve Lyons) and James Schaefer
Jun: HavenLock (Alex Bertelli) and Anil Jha
May: Discotech (Ian Chen) and Gary Awad
Apr: Sashee Chandran, Seatrec and Susan Marki
Mar: Yezin Taha, Spine Align and Jamie Bennett
Feb: Phoenix Gonzalez, Repurpose and Marcus Filipovich
Jan: Ksenia Yudina, BeTheBeast and Larry Uhl
Nov '21: Roy LaManna, TotSquad and John Keatley
Oct: Dr. Chorom Pak of LynxBio and former president Al Schneider
Sep: Luk Network, Brandon Cavalier and Nancy Dandridge
Jul: Electrum, Jose Gomez and Julie Pantiskas
Jun: Ready, Set, Food, Dr. Mirianas Chachisvilis and Joseph Pitruzzelli
May: MagicLinks, Christopher Hussain and Janice Orlando
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Dave de Csepel
Chairman, Pasadena Angels