Dave Bradbury / VCET
Start Here Podcast | Episode #68 | 06/30/2022
It’s what you’ve all been waiting for. Today, Sam interviews surfer, snowboarder, self-proclaimed recovering entrepreneur, VCET President, and Start Here co-host Dave Bradbury.
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#StartHere PODCAST: Episode 68 with Dave Bradbury of VCET
Transcript (courtesy of ReadBack):
David Bradbury: You know, there were two moments when we took ourselves off payroll early on because we weren’t sure there was cash. But we felt the mission was there, our story would resonate over time, and more importantly, the people we were purporting to help were seeing it. They were getting funding or getting grants. The customer was being successful, so we all collectively felt like we deserved a chance to go another year.
From the Vermont Center for Emerging Technologies, it’s Start Here, a podcast sharing the stories of active, aspiring, and accidental entrepreneurs. It’s what you’ve all been waiting for. Today, Sam interviews surfer, snowboarder, self-proclaimed recovering entrepreneur, VCET President, and Start Here cohost, Dave Bradbury.
Sam Roach-Gerber: Welcome. This is Sam Roach-Gerber –
DB: And Dave Bradbury.
SRG: Recording from the Consolidated Communications Technology Hub in downtown Burlington, Vermont. I know a lot about Dave, but maybe our listeners don’t, so this is a fun opportunity.
DB: Well, let’s try it. It’s spring, let’s go for it.
SRG: All right, so tell us about young Dave. Where are you from, and when did you start standing sideways?
DB: Great question. I grew up in Littleton, Massachusetts, about 35 miles outside of Boston. I’m a “Masshole” through and through. I think the Boston Bruins are the only team in the NHL that matters, and Tom Brady is the GOAT. I started standing sideways as a young child. I spent $41 to buy my first skateboard in Acton, Massachusetts at the skate shop. It was Sims Wood Kick 26” with either Kryptonite or Kryptonic wheels. Really, that’s probably when it happened.
SRG: I love it, an early age.
DB: It was a ton of money. I worked really hard to get it and buy it, and I still have it to this day in my garage.
SRG: In your “garage,” I love it. Such a “Masshole.”
DB: Yeah, sorry about that.
SRG: All right, we’re going to do a little rapid fire “get to know you.”
DB: Oh, cool.
SRG: Yeah, kind of fun. All right, what was your first job?
DB: A farmer, bailing hay for $1.50 an hour.
SRG: To get the skateboard, obviously.
DB: Obviously. It took a lot of hours to get the skateboard.
SRG: I bet. Dogs or cats?
DB: Oh my gosh! Dogs, Labradors to be specific.
SRG: The only answer I would have accepted.
DB: I don’t believe in anything with a poodle or ‘bradoodle.
SRG: Best concert you’ve ever been to?
DB: It was The Clash at the Worcester Centrum during high school. It was absolutely formative in my life, and being on the stage – because they encouraged people to come up – was something I’ll never forget. I fought the law and the law won, baby.
SRG: All right, Dave. You are a proud UVM alum. You’ve mentioned that you’re a “Masshole.” What made you choose to be a Catamount? What drew you to Vermont.
DB: It was really place. I’d never been by Exit 1 on the highway, on I-89. My family had a ski house, a sort of condo place in Quechee.
SRG: So you’re a Southern Vermont guy.
DB: Just barely over in New Hampshire, it was just where we deposited. It was a March day. My mom and I decided to drive to Burlington after a foot of snow, cresting that hill looking out toward the lake. And I said, “Dear God, this is a place I want to go to school. Do they have colleges here?” And UVM became a choice, and yeah, that’s how I ended up there, kind of on a whim.
SRG: Awesome, and no regrets apparently?
DB: No, I love the place. Throughout your career in life you can do just about anything, and I wasn’t sure what anything would be over time, but I knew pretty much where “anywhere” was.
SRG: I love it. And what is your study, and does it matter? For some of our listeners that might be in college now.
DB: Yeah, I went to the business school. I grew up watching my mom and dad just sort of do their projects and jobs, and I wanted to learn business. I thought pretty much I was going to go to Wall Street and trade derivatives, mortgage-backed securities, and that kind of thing.
SRG: What was the best class you took at UVM?
DB: Forestry, freakin’ awesome. I took it with a lacrosse team at night. It was once a week, and it was just a chance – nothing I was ever interested in, but it was really a neat way to just learn about nature, management, land, and all that stuff.
SRG: I like to picture young Dave Bradbury exploring Burlington for the first time. What was your go to spot back in the day?
DB: Boy, tough to say. It’s like I never left a spot, so I was out there a lot. I think the Last Chance Saloon is the one I have the most fondness for. It was in the basement of what’s now the Flynn Theater. It was a really cool, nasty little college bar that was a lot of fun. I had a lot of good memories there. It’s funny, to jump ahead a couple of decades later when I was on the Flynn board and they wanted to remodel downstairs, I’m like “No! Don’t do it!” So, I lost. Thank God they put it into more productive use.
SRG: It was probably for the best. So you describe yourself as a recovering entrepreneur. What was your first business?
DB: I think early on mowing lawns, buying a lawn mower, borrowing a truck, and then painting and landscaping throughout college. I really took a liking to stone masonry – stone walls, patios, and things like that – and I still often wonder, I just should have stuck with that. That was pretty neat.
SRG: That would have been interesting. There is a demand for it.
DB: There is. A couple of my really good friends have stuck with it, and their bodies are a bit more aged than I think mine at this point. I’m probably doing what I was meant to do.
SRG: They don’t have the computer hands that you have?
DB: No, there’s are more mangled and a little bit aged. But anyway, they love it and are happy.
SRG: I feel like a lot of entrepreneurs we talked to had some sort of side hustle in college to bring in some money, and that’s a good way to do it.
DB: Well, and I also wanted a backup career, right? I mean, thought I was going to go into finance. That’s sort of fickle, it works or it doesn’t. Big stakes, big ups, big downs. Again, if you ever wanted to CTRL-ALT-DEL your life or move to a different part, would you have a skill that you could earn through your labor, your smarts, your sort of creativity? And I felt stone masonry and some of the other things like that were pretty neat.
SRG: So if the Internet goes down, we know what Dave will be doing.
DB: Exactly. Call me, I’ll bid out of stone – I might get in the stonewall business again, seeing how much people are charging.
SRG: I’d hire you, 100%. I feel like we ask our entrepreneurs this question, so it’s only fair that I ask you as well. From an entrepreneurial perspective, any massive failures you’re willing to admit?
DB: Oh yeah, a ton. I think importing water coolers from Italy. They made this really high quality Perrier-like bubble, but the damn things wouldn’t ship well and would break. We thought we were buying a Ferrari but we ended up with a Fiat. That was a good learning lesson. I think that one failed.
And then another one just didn’t take off, really interesting, around outdoor wood boilers, those furnaces with the dirty pipes. I partnered up with a really sweetheart of a guy who was the inventor and patent holder for the cleanest systems in the world, and we tried getting it off the ground. That was a little too early, but we tried.
SRG: It’s all about timing. So switching gears a little bit, you have invested in dozens of companies. What do you look for, and any major red flags that you stay away from?
DB: Yeah, I’ve done personal investments all along as an angel, and then for the last 15 or so years really concentrated on VCET and the seed fund realm. At the early stage you don’t really expect any team to have it fully sorted out. What you want to do is find folks that have magic in their eyes and they’re true in their hearts. They’re aligned with maybe a partner that they have, and they’re undeniable in what they’re trying to build and do. Because that sort of grit and perseverance will make up for all the lonely times, the uncertain times, and the struggle. It’s truly an 80% bet on people, 1% a bet on patent if they have one, and the 19% is really around market timing. Is the world ready for what you have? Can you build it at a reasonable return? How do you get it into his or her hands?
SRG: And in terms of red flags, is there anything that you see that immediately you’re kind of like, “Oh!”
DB: I think people who talk really fast. Some are nervous, so you can check your bias. But there’s usually an overpromise, a sort of hyperventilation of business vomit that that comes through, and I think that’s really tough to get a sense of the person. Because even for those that do that, there’s usually a lot of real and genuine and perhaps brilliance in there, but you sometimes have to filter through that. So I think a few dates, a few instances of contact, it might be an event, it might be in a little social post that we’re commenting on back and forth, and a couple in-person meeting. That would be one red flag.
And then the other, particularly attract folks over time would be, was the team able to accomplish to some incredible percentage what they said they were going to do? “We’re going to build this prototype by May.” “Great, it’s now June. How did the prototype go?” “Well, we didn’t get it done.” “Okay, well, why?” And sometimes there’s good reasons and sometimes there’s really poor reasons. I think, again, that gets to the fundamental bet, of using other people’s money is really a bet on you to figure it out, and can you figure it out through these certain interim milestones. They don’t have to be grand or moonshots, but more operationally, can we make incremental progress toward the vision we’re pursuing with the limited people, cash, partners, or whatever resources we have. And if they’re able to do that, then those are people you want to bet on.
SRG: That’s such good advice. From the entrepreneurial perspective, do you have any advice for folks that are out there fundraising? I mean, it’s a real slog. It’s really hard to do. Any advice. I know you said it’s important for them to follow through. How can you show investors that you are in fact following through with what you said you would do?
DB: Yeah, I mean, I think specifically a follow through, like, the next last slide should always be, hey, here’s our milestones. And you’ve got eight bullet points, and four of them are got check boxes, and then one of them is yellow because you’re working on it, and then here are the next three that I’m going to do with your money. So again, it just leaves the illusion of momentum, accountability, and transparency, all things that people love to back and invest, rather than some black mystical bullshit box that you could get to. For me that resonates. I probably have other things. I already forgot what the question was.
SRG: You did answer it, so you’re good. I am drawn to ask you if you recall the favorite pitch you ever received, or were on the receiving end of your favorite pitch?
DB: Yeah, Chad Brodsky, a UVM students who was working at, I don’t know, a bank or something downtown. He walked in one day and says, “I’m here to solve loneliness, and here’s how I’m going to do it.” It’s like, boom, right?
SRG: Yeah, the purpose.
DB: It was like, “Hey, who’s up for a movie or who’s up for a game of Frisbee?” Like, how do I find a friend in the moment or find somebody that maybe I don’t know or don’t know too well, and do it just to solve that that loneliness that everyone feels at times about doing things. It was freakin’ awesome. “I want to solve loneliness. Here’s how I’m going to do it.”
And then another one was Lyn Oligino with BioFlag Therapeutics. She came in one day and said, “Chemotherapy is a killer. Here’s how we’re going to not use it again.” I was like, fuck, I don’t know what you’re talking about but I want to learn.
SRG: I’m hooked.
DB: If you think about it, those two sparked curiosities in me immediately. They must have hit some sort of emotional strand that that I could identify with. Who hasn’t been lonely, or who doesn’t know someone in chemotherapy? Those things are great hooks. Then then I was investing my time and my belief that I wanted to hear their full story.
SRG: You did a really good job answering that, considering I couldn’t have asked it in a more awkward way, so I appreciate that. I don’t have my cohost here.
DB: It’s pretty weird. It’s tough without a wingman, right?
SRG: Well, it’s lonely over here on the other side of the table.
DB: You’re doing fine, Sam. You’re doing fine.
SRG: Thank you so much. You came into VCET in 2007, freakin’ 15 years ago, Dave.
DB: Yep, just about 15 years ago. I can’t fathom that. It’s been awesome.
SRG: Tell folks, what did the organization look like in 2007, and has is it sort of evolved since?
DB: VCET, the Vermont Center for Emerging Technologies, started as an idea on Dr. John Evans’ kitchen table on Spear Street. He was then the Dean of the Medical School, and at the time they wanted a university incubator. The doors opened at UVM in June 2005, and it really was set up as sort of a classic, let’s work with docs and students to commercialize stuff.
A couple years into it, they were off to a very good start and they were ready to go, but I think they felt like they wanted to make a change and bring someone in a little bit more entrepreneurial. And also, it wasn’t really connecting to the degree that the board wanted to see here in Burlington, and the world was changing a little bit. Right around then we started hearing about economic development, overlaying with higher education, overlaying with this thing called entrepreneurship, and those three circles started to overlap. Right around that time, those were things I was thinking about personally. Just sort of a couple of phone calls later, I said, “What the heck, might as well.”
Sooner or later, he called and said, “David, we’ve started this thing. Get back to work, stop snowboarding. Put your wife on the phone.” And that was it. They talked about spring peepers this time of year, and kids, and then afterwards she hung up – Emily did – and she said, “What was that about?” I said, “I don’t know, but I think I have a job.”
And we just drove right in with Frank Cioffi and Fred Hackett, who was the original chair and, and so many other board members, many of which are still involved today. That said, we’re going to put in the time, the grit, the perseverance, make tough calls along the way, in order to build something that, rather than do it for our donors or institutions, let’s do it for the customer. Let’s find the entrepreneur, make her the north star, and build it around what she needs in that moment over time, and let’s be nimble enough so as times change we can do things like coworking, or venture capital, or a Female Founder series. I think that’s been the pure joy. That’s why 15 years has flown by, because it seems like it’s very different every three or four years. You’ve been here six years now and have seen it, and are very much a part of that, which I’m grateful for.
SRG: Yeah, it does – and I think you’ve mentioned before – that VCET operates itself very much like a startup, which I think helps us, as you would say, look around corners, right? I think you did mention as well as that sort of stability, too. Can you talk a little bit about VCET’s business model and how we’re able to do what we do?
DB: Yeah, it’s changed quite a bit. When I came in in June 2007, we were 99% funded by earmarks from US Senator Patrick Leahy, which is amazing. Which is a tough way to live, but that was our seed money. And then over time we transitioned that into earned income from establishing a venture fund, into owning properties, a fantastic 10-year partnership with Middlebury College, that we’ve now extended another five years with a building, and now into more operating programs.
The State of Vermont stepped in when we had a real lonely time. There were two moments when we took ourselves off payroll early on because we weren’t sure there was cash, but we felt the mission was there, our story would resonate over time, and more importantly, the people we were purporting to help were seeing it. They were getting funding or getting grants. The customer was being successful, so we all collectively felt like we deserved a chance to go another year. Not just to self-perpetuate but really activate resources in our community and advance the collective good through entrepreneurship.
SRG: So cool. Oh man, what a cool place to work.
DB: Yeah, right? And we got T-shirts too along the way, that was even better.
SRG: So you’re not big on strategic planning, as I learned day one at VCET. Can you talk to us a little bit about what your approach is? You do talk about looking around corners. How do you do that, and how do you sort of plan what’s next for the organization?
DB: Yeah, I mean strategic planning, I used to do this for folks consulting, and it can be really important. But those are for, I would say less nimble larger entities with hundreds of employees, to sort of motivate and align. I prefer organizations our size. I prefer organizations our size, that really have this rolling three-year kind of perspective, because I do think you can predict and hit the target really well based upon market insights and peers that you go visit. You and I walk in coworking centers and innovation centers all over the freaking world and country, and I think, one that’s really a great reflection of our whole team that does that. And we learn, and how do we version something to Vermont, or not do something because we have talked with a peer elsewhere.
So I think in terms of that three-year look, first movers usually don’t succeed and they’re usually crushed by market forces. We see that with startups that go to market too soon. The customer just isn’t ready, or the world’s not ready, or it’s too hokey or gimmicky. I think being a fast follower, an astute learner, and then committed as a team to say, “We’re going to do this.”
I look back to 2008 or 2009 when the seed fund was discussed. No one wanted to do that. Even in our own organization, “No we don’t want to do that, it’s not our lane, what makes you think we can do that.” But we said no, we have data. There was a list of 110 companies looking for capital. There was research on models that had worked and hadn’t worked elsewhere around the country that could be provided, so that we would do things like not have a 15-person UN-style decision making process for investments. We have a three-person investment committee that is accountable, nimble, and committed to the long term.
Little tricks like that. Going to Ireland to look at their university incubator system, which at the time was top in the world, and say, “What tricks do you have?” They’re like, “Oh, yeah. Glass doors and don’t allow anybody to put paper over it. We need to see.” Or, “If you have trouble getting people together, only have your coffee bar open for one hour in the morning and one hour in the afternoon, because then everybody comes out of their cubbies and talks.” We haven’t gotten that draconian around coffee – I think there’d be a revolt –
SRG: Yeah, I’d be scared.
DB: But things like that. I think time through our service, to judging competitions at Mass challenge, or being a mentor at different programs around New England in particular is quite relevant, or through some of my volunteer work elsewhere.
SRG: Do you want to talk a little bit about your volunteer work? I know you’ve volunteered in Tunisia before, I believe? Tell us a little bit about that.
DB: Yeah, Tunisia came about, that was 2014. It’s hard to believe it’s so long ago. It was probably nine months after the Jasmine Revolution, the Arab Spring. It was a chance through this really neat organization called the Financial Services Volunteer Corps, which had been started by a former Secretary of State and a former Chair of Goldman Sachs. They’ve got professionals, and went into developing or recently liberated countries to help them set up systems, whether stock markets or credit markets. I specifically went in to work on seed funding and university-based startups in Tunisia. That was a really, really awesome experience.
SRG: Because once you triage, you need opportunities, and you don’t really think that far ahead.
DB: Yeah, totally right. I learned as much as anything. Their corporate law is based upon really kind of French corporate law, which is so ass-backwards. The entrepreneur in our country and our system, they get 100% of ownership up front, right? And then I give you money and you give me a little bit. But to incorporate there, you had to demonstrate the value of your company on day one, which is worth nothing. So it was just really weird.
It was a good perspective for me to understand, but really I think at the time in Tunisia, they had something like 20,000 college graduates a year. It was free college, and so many of them were engineers, and they were trying to sort of start up businesses. So it really was a moment in time around the Arab Spring for me to go and share some of our Vermont state public policy venture stuff to these really brave and committed individuals in Tunisia.
SRG: As Steve Blank taught us, you’ve got to get out of the building, right?
DB: You’ve got to get out of the building to see what it’s like. The other volunteer project that I’ve done for a bunch of years is working with US Special Forces personnel, usually a few years before they’re transitioning out of active duty. For those that are interested in starting a business, to really work with them privately. They go off the grid for months at a time right to do good in the world. I think that was such an awesome wonderful chance to give back with corporate leaders from around the country, to a handful of folks that quite literally are the tip of the spear and what they do. They have intelligence, degrees, and entrepreneurial grit to add a little bit of shape to that. So that they might do something other than a predictable stand at trade show, or buy a bar or a boat or something. Many of them want to go on and start businesses, and I think that’s really been gratifying over the years.
SRG: And real good population to know, I would say.
DB: Well, yeah. When I went to Tunisia I gave my wife, I was like, “Here are the phone numbers to call if you can’t find me.”
SRG: You briefly mentioned VCET’s board. It’s I want to say an impressive group, but that doesn’t even begin to do it justice. Can you talk a little bit about what your approach is with VCET’s board? I think every organization really does it differently. From a very biased opinion, I think you’ve cracked the code. Can you share a little bit about that?
DB: Yeah, sure. VCET’s a nonprofit. When I came on board, I knew we had a multi-year sort of transition ahead of us, to go from all federal, to earned income, to relevancy with our customers, to trying to make a difference here in Vermont, not just Burlington where we were based originally. I wouldn’t use the word “impressive” with the board. I think they’re really authentic, and they are caring to a T to donate time they don’t have to our cause. And our cause is messy. Entrepreneurship is messy, it’s fluid, it’s up and down. We don’t know if it’s worth anything today or nothing tomorrow.
And I think through thick and thin, our board has been outstanding. What we did early on was, it was very weighted toward higher education, which was sort of the model at the time. We slowly over two years transitioned that to half being sort of entrepreneurs or founders businesses, to they would have empathy or greater empathy with our clients, and also our clients would see them and say, “Oh, I want to be like Briar Alpert at BioTek.” Or one of the others, or Lisa Groeneveld at OnLogic, that’s my dream.
I think that was a really interesting thing. Back to those three circles around higher education, economic development and entrepreneurship, those were sort of the three representations we wanted to see. And then over time with that sort of three-year role, some of those get more important over the other. Colleges have been under a lot of dress with their business models and COVID; getting their leadership’s attention sometimes is a little bit more difficult. So let’s get some more entrepreneurs or go find younger folks with different experiences and more diverse folks. I think that to me has been awesome.
We do have an amazing group, and then we have 130 mentors, so that if we need to find a rocket scientist we can go find one. Or an investor that’s used to life sciences investments, to help us not make obviously stupid mistakes. If we can avoid the really dumb ones, I think our chances are better.
I’m so proud, and I think for you and I to both be able to learn from many of them over time, and to have them help our companies and in very small and profound ways – both visible and behind the scenes is – that’s the secret sauce hell.
SRG: Hell, yeah, it really is. We’re so lucky. What emerging technology are you hyped about right now?
DB: I think certainly anything to do with battery storage and renewables, I think is really time, no profoundness there. We’re going to figure it, it’s going to happen at scale, and we’ve got some fantastic companies here in Vermont – including our portfolio company Northern Reliability, that that recently announced its merger with KORE Power. Substances, I’m really interested in. Graphene is one, this magical – I don’t know what it is, a material or an atom, whatever, but it does really wonderful things with electricity with its size, density, and these properties that sort of unlock all sorts of potential both within batteries and both within semiconductors. So these sort of foundational blocks of life –
SRG: Running shoes, I believe?
DB: Yeah, running shoes, who the heck knows? I think that one’s really fascinating to me. And then there’s been some other ones, mRNA all of its different sort of versions. It’s really what Elon Musk called it the other day, it’s a computer code, right? We’ve just got to tell it what to do. I think we’re in the early innings of that. COVID accelerated the mass adoption of that platform. You and I both know and are thrilled with Vermont’s first mRNA facility and producer, Vernal Biosciences. We are the only Vermont investor there. It’s a fantastic company, scaling quickly. Things like that I think are good brain food for us. But big picture, how do we help people? Health care, climate. We’ve got to be able to feed and protect ourselves going forward. I think that will be the challenge of our lifetime, given population on a small marble.
SRG: We’ll hopefully get the graphene experts in Vermont coming out of the woodwork here.
DB: I’m looking for one. I kind of feel like I need that T-shirt, “Got graphene?”
SRG: There you go, walk around City Market.
DB: I shudder to think what I would hear on Church Street from that. That would be awesome.
SRG: We talked a little bit about the seed fund. We touched on advising a little bit. I think one of the things that VCET is best known for, because of the visibility, is our co-working. Can you tell me what you think is special about the VCET community? You live in Stowe, but you choose to be here every day. Why?
DB: It’s the absolute just magic that people bring, whether they’re building browsers for the biggest companies on the planet, or conducting an election campaign, messaging and software, writing poetry, or making music and software. It’s this little Noah’s Ark of a couple of these, a couple of those. I think all along this sort of bet with a coworking space, we always wanted to keep it small – under 100 and 50 people – I don’t think we’ve ever had 150 people at any one time, which is great. I’d say 80 is probably optimal.
But small communities behave differently, right? They’re coworkers in a shared space rather than strangers in a big space. I think for me that has meaning and purpose, and I think a collective sort of support that a good portion of folks thrive. Weave in some academics, researchers, students, serial entrepreneurs, and investors, and you’ve got this creative Petri dish of awesome and potential. The fact we get to come to work, make coffee for them, and participate in help is, again, it’s intellectually challenging, it’s motivating, and I think gives a lot of purpose and hope for our future. I don’t know, why do you come to work?
SRG: I don’t know. I like the vibe, a good vibe.
DB: I think entrepreneurs, founders, and even remote workers now, it’s a different person. It’s not someone who just quietly just wants a 9-to-5, punch the clock and do their thing. Thank God there’s people that do that, because they have other interests and things they like. But these others, they see something that either inspires them or pisses them off to some degree, that they want to do something about it. I think that’s where change happens.
SRG: Totally. I was sitting here setting up our podcasting equipment, and a member poked their head in and said, “Hey, I did radio for nine years if you ever need any support.” I’m like, “Oh, my god.”
DB: Am I that bad on this show? Are you interviewing other people? Jesus, Sam!
SRG: No, he just poked his head in to offer that support.
DB: God, I’ll have to cancel that person’s badge.
SRG: Dave, is now a good time to be an entrepreneur in Vermont?
DB: It’s never been better. I think between people, money, support, and different groups, the Center for Women & Enterprise, the SBDC, and certainly the 400 folks we talk to a year. You can get really credible free or near-free advice. For those that need capital, there’s banks, there’s grants, and then there’s an array of sort of venture investors. Its’ a great time.
That doesn’t mean bringing an ill-baked or ill-thought-out idea is going to be any more successful, because there’s probably some more noise. You’re competing against others. But yeah, more companies are started. I think the metric I look at is less about sort of capital in – it’s a little bit of a vanity metric is, how much went into the system? – well, actually, we want to talk about outputs. What customer was happy with the product? What revenues have the company earned. Are the employees taken care of? Is there ownership or career paths, given all the risk they take early on. And I think all those things are trending upward. Because of COVID, remote working, and sort of the fluidity of capital and where it goes now, you don’t have to be inside 128 in Boston or on Sandhill Road.
Those two things bode very well for a rural, well educated, and also sort of a little bit of an elitist place like Vermont, where we think we can do it better. You know what I mean? Sometimes we’re so early that it takes a while for the rest of the world to say, “Oh, organic,” or, “farmers markets, or “CBD,” or “SaaS products,” things like that that happens. It’s really a neat time to go for it, so reach out if you’re trying to start a business.
SRG: Yeah, awesome. That’s a good question. For folks that are looking for help or are thinking about starting a business, do they need to have anything sort of prepared in order to reach out and get support from VCET?
DB: We’ve talked a lot about that. Frame the frame the discussion. If you’re asking for money, ask for advice. I think that’s the way to go about it. And then our approach here was to sort of take out the snobbiness, the elitism, and kind of the walls about having an authentic expert conversation. We worked on those words on our website. They’re like, “Come as you are, who you are, with what you got. We don’t want to be pitched. Let’s get to know you.” Again, back to that, we bet on people. You and I meet with people that we’re like, “What a shitty idea this is, but boy, they’re going to hit it out of the park on something so let’s work with them on the next thing.” I think I’m pretty proud of that.
It doesn’t mean capital isn’t really tough to get. This is the top of the food chain. Less than 10% of business start with “venture” money. It’s usually your customers’ money, or you take out a loan in your house, or sell off an acre of land if you’ve got one, or use your eBay or crypto proceeds to fund something.
I hope we’re accessible, and I hope we’re candid and giving feedback that comes from a genuine trusted place. That we put the time in to listen. We have a perspective that may be wrong. I mean, we just said no last week to people we’ve known for a lot of years that we really, really respect. We just couldn’t get comfortable. I think they wrote back like, “Okay, thanks, but I can’t wait to prove you wrong and make you regret this.” And I wrote back and I’m like, “Nothing would make us happier, because we don’t learn unless we’re wrong.” Or we get the challenge or patterns that we see or don’t see. Again, I hope we’re embarrassed by our decision not to invest in them someday.
SRG: Awesome, that’s great. What’s next for VCET? What are you excited about?
DB: I’m excited about the conversations that you and I are having and the board’s having about what to do. We’ve worked really hard to be in a place where our companies are doing well, our services are known and respected, and we play well with others – at least the good actors. And I think that as we look around the corner here, I think we’re going to see more and more need for access to early revenues and still seed capital, the $2 million and under kind of rounds. We did eight of those rounds in the last 12 months, I think probably the most active investor in that regard, and it’s a lot of work and a lot of unknown. But half of those companies have already raised larger, bigger rounds to sort of get to the next stage. Others will germinate a little while longer.
So I think between that, and helping companies find customers, because you’d rather have a dollar of customers revenue than a dollar of some investor’s money any day. Access to people is a big deal. I think from a policy perspective, I think we probably have an opportunity to sort of help shape how we think about a modern company and a modern workforce. Because classic policy, government, and economic development is here or there, build it here or there.
But the conjunction is “and,” and it has been for a few years. It’s only been amplified and accelerated with remote working, distributed workforces, and Vermont’s critical lack of labor, which leads to a lack of housing, a lack of childcare, and all those sorts of things that compound it.
I hope we address and try to fix those, but in the meantime we can’t wait a generation, so we need to think, what’s good enough to get a company here? We don’t need all of it to be proud. We don’t need all that for those employees to be successful, and to support their communities and make a living. I think that’s the challenge of our economic development roadmap, from what I see.
SRG: We’ve still got some work to do, Dave.
DB: Oh, dear Lord, yes.
SRG: Before we move on to the “magic wand” question, which I know you’ve been waiting six years to answer –
DB: I mean not have one. I’m going to go blank on that. Thank you for that warning.
SRG: It is a warning. Is there anything else I should have asked you that I didn’t?
DB: Someone asked me the other day, “Why are you still doing this?”
SRG: Why are you still doing this?
DB: I’m afraid to say goodbye to you, Sam! I want to win. I frame winning as the success of these people that risk it all. That I think to me is the juice, to keep going. We work so bloody hard with so many other people to finally get to a point where it’s starting to feel like it’s humming and working, right? Not just in Burlington, but elsewhere. All of our colleges now have entrepreneur and innovation things. You couldn’t say that six years ago. You get to hopefully this sort of flywheel stage, where just the gains are incremental, they’re incremental squared, right? And that builds, and I feel like that’s a very exciting time to be there for it.
We’re going to see a lot more venture capital, permanent evergreen capital come into VCET for managing, which is really exciting. I think we’ve stretched our $6 million dollar fund as far as anybody ever thought. We’ve got 32 investments in that fun; it revolves, it works, and it’s proven, so we’ll be adding a lot more to that. I think that will be generational and transformational, because our perspective is a little bit different than maybe a pure private investor’s perspective. Our time horizon’s different. Our sort of support structure and our view of what quote is venture-worthy – which is such a snotty word to use – but I think we want to focus on, are these people presenting an opportunity that we can rally around that has a better-than-average chance of success in Vermont. That to me is winning. So that that’s pretty, pretty interesting.
And then I’ve got two kids who are teenagers, my wife and I, and I like to think that that all of our sons – [00:43:05 Lochlin] is a few years behind Sam – but I do feel like that we want to make sure that the jobs of the future are here today, and that there’s diversity and choice. It’s not either/or, or that they’re so plastered when they’re in colleges or in their communities, that they see that there are robots here in Vermont. There are all sorts of renewable energy, agriculture, life sciences, mRNA, and data science stuff. That stuff was not transparent and wasn’t around eight or ten years ago, and it is here today. Again, I think that to me is worth sticking around for and maybe delaying my landscape business a bit longer.
SRG: All right, I love it. Yeah, I think that’s super important to keep the opportunities rolling. Awesome, Dave. Thank you for joining me today. I’m so sorry my cohost was unavailable, but it’s always great to catch up. Hopefully our listeners learned a little bit more about Dave today.
DB: Thank you, Sam. What a what here. I hope this actually makes it to the air.
This has been Start Here, a podcast sharing the stories of active, aspiring and accidental entrepreneurs. This series is supported by the Vermont Technology Council and Consolidated Communications.
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