The Founder’s Roadmap: Scaling from Seed to $2M+

Leena Manro (: 00:00

Welcome to Up to So Good, the podcast that unlocks the secrets of creating a purpose-driven business so we can all make this world a better place. Come join the conversation. Hello, and welcome to Up to So Good, the podcast that explores the purpose of business. I'm your host, Leena Manro. A shocking number of businesses, they fail right from the get-go, and often this is due to a number of factors, which includes not necessarily having the right experience or advice from the beginning, or not knowing how to keep a business successful once they finally launch and once they finally get there.

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Well, in today's episode, we are really lucky and really fortunate to talk to someone who has actually advised and helped thousands and thousands of businesses, startups, and businesses in all stages of their development become successful and stay that way. Today we're interviewing Keith Ippel. He's an investor himself, a social entrepreneur, but also the co-CEO and a founder of Spring Activator. Spring is a global incubator, accelerator, and advisory firm. And he has helped countless visionaries and change-makers excel in their businesses, and in doing so, create even greater impact for this world.

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This is a really inspiring conversation and I think it goes beyond startups and also impact businesses. The advice from his many years of experience is absolutely valuable and wonderful no matter what stage of business your business is in. So I hope you sit back with a cup of coffee, cup of tea, and enjoy this episode. Welcome to Up to So Good, the podcast that explores the purpose of business. I'm your host, Leena Manro. And today we have with us the co-CEO of Spring Activator, Keith Ippel.

Keith Ippel (: 01:39

It's great to be here. Thank you for having me.

Leena Manro (: 01:42

Well, thank you so much for joining us.

Keith Ippel (: 01:44

Absolutely.

Leena Manro (: 01:44

So Keith, I mean, wow, where do we start? Spring Activator, it's a fantastic organization.

Keith Ippel (: 01:50

Thank you.

Leena Manro (: 01:51

Let's talk a little bit about what Spring does.

Keith Ippel (: 01:53

Love to. So Spring exists to change the world through innovation. And so, at the heart of Spring, we work with early-stage impact entrepreneurs and early-stage impact investors to change the world. What does that mean? We do a lot of work at the intersection of impact and tech. So for us, that includes healthcare, future of climate, future of food. We do a lot of work as well with women and gender-diverse founders, with BIPOC founders, with newcomer and immigrant founders. And really, ultimately what we're trying to do is help early-stage companies to unlock that growth product market fit, that's a term that we all love to use, often raise the first and/or second round of capital, help investors to find their place and impact, to add the classically return on investment is that mix of risk and return. And so, we like to add that third layer, which is risk, return, and impact. And together, I think those two communities being founders and investors, they have the power to change the world for the better, and that's what we're trying to foster.

Leena Manro (: 03:05

Amazing.

Keith Ippel (: 03:05

Thank you.

Leena Manro (: 03:06

So basically, it's an accelerator, but also I've heard terms like incubator.

Keith Ippel (: 03:12

Yeah.

Leena Manro (: 03:13

And what does this mean, incubator?

Keith Ippel (: 03:15

Well, this is actually a great way for us to help all of the audience while they are friends at the next cocktail party. And so, incubator is this term that we often use for companies at the earliest stages. Often pre-launch, they're looking to do idea validation. They're looking to really build an understanding of what it means to be a great entrepreneur and to get into market. An accelerator often is an organization or a program that helps people to accelerate their growth in the market, unlock what we call product market fit, which I mentioned earlier, and really is a way for them often to raise their first round of capital.

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There's a third term that actually is really important and actually anchors a lot of what we do now as well, which is a venture studio. And a venture studio, unlike an accelerator, it's a 100% bespoke approach to work with companies to help them to unlock a certain aspect of their business. Sometimes that's technology, sometimes it's fundraising, and sometimes it's go-to-market growth. And in our case at Spring, our Grow Venture Studio is exactly that. It is a growth venture studio focused on go-to-market, sales-centric, unlocking revenue, unlocking pilots, and really getting people to go there. So incubator, accelerator, venture studio at your next cocktail party.

Leena Manro (: 04:37

Incubator, accelerator, venture studio?

Keith Ippel (: 04:39

Yeah, yeah.

Leena Manro (: 04:40

And basically if you are... Well, okay, I should actually ask you this instead of stating it, but where do you need to be in the creation of your product or your venture to come to the Spring Activator?

Keith Ippel (: 04:55

Yeah. So typically at Spring, entrepreneurs are coming to us somewhere kind of six months pre-launch to about two million in annual revenue. And it's really about the combination of empowering education, access to really strong subject matter expertise, access to network, access capital. And so, sometimes founders are saying, "Hey, I need to raise my first or next round," or, "I don't know how to go from pilot to contract," or, "I don't know how to turn my first customers into repeatable customers." These are some of the questions that we hear. And when entrepreneurs are surfacing those questions, it's a good time to call Spring.

Leena Manro (: 05:34

Amazing. So that's a wide range of people that are accessing the resources and the incubation and the accelerator, I guess, services that you provide. So six months pre-launch, and these companies, they don't have revenue up to two million?

Keith Ippel (: 05:53

Correct.

Leena Manro (: 05:53

That's beautiful.

Keith Ippel (: 05:54

Yeah. And it's interesting, because if you're, for example, like a clean tech company, hardware, AI, but a lot of deep tech, then that's often where we'll talk to them early pre-launch. If you're a software as a service company, if you're a CPG impact food business, often they'll contact us when they're in revenue. And so, sometimes the lever that we would pull is around the amount of tech that's involved or intellectual property. And when they have more tech, typically they need more help, direction, guidance pre-launch, because they need to get those pilots, those proofs, those concepts linking in, kind of granting programs to help them get there. And so, for us, we understand that the fulcrum is always around funding for early stage entrepreneurs. Ideally, it comes from revenue, but also grants, loans, angel investors, venture capital funds. And so, that's really where we built our expertise, is really helping to unlock capital, both for founders and investors alike for early-stage impact.

Leena Manro (: 07:02

Amazing.

Keith Ippel (: 07:03

Yeah.

Leena Manro (: 07:04

It's such a unique business.

Keith Ippel (: 07:05

It is.

Leena Manro (: 07:06

You're the only person I know that's a co-CEO or at all involved in an activator type of a business. So it is very unique. I want to know what got you interested in all of this and what your role is as a co-CEO, because actually, that's also somewhat rare. And I want to preface this by saying we know each other a little bit, right?

Keith Ippel (: 07:31

Absolutely.

Leena Manro (: 07:32

You're one of the kindest people that I have ever met and you're one of the few people who I feel like everybody always says positive things about, you are such a connector, such a networker. And very much like anybody who knows you, they're like, "Oh, I love that guy. Keith, I love that guy." You have a very, very positive reputation and people know that about you.

Keith Ippel (: 07:53

I appreciate that.

Leena Manro (: 07:55

Yeah. So I feel like the whole co-CEO thing probably works really well for you because it seems like you are already a very collaborative person, but yeah, tell me what that world is like.

Keith Ippel (: 08:06

As co-CEO?

Leena Manro (: 08:07

Mm-hmm.

Keith Ippel (: 08:09

So I had the very good fortune back in 2005 to be at a conference and actually spent literally about 90 seconds in an elevator with Jim Balsillie, who happened to be in the elevator of RIM. And at the time, if I date myself, RIM was run by co-CEOs and he was one of the two.

Leena Manro (: 08:32

Pacific Rim Hotel?

Keith Ippel (: 08:33

No, RIM Blackberry.

Leena Manro (: 08:35

Oh, RIM Blackberry.

Keith Ippel (: 08:37

So Blackberry. Yeah.

Leena Manro (: 08:37

Oh my gosh, Blackberry. I was like, "He's saying RIM. What is RIM?"

Keith Ippel (: 08:39

Check out the Netflix show, everybody.

Leena Manro (: 08:43

So good. The movie?

Keith Ippel (: 08:44

Right.

Leena Manro (: 08:44

So good. Yes.

Keith Ippel (: 08:44

So what was interesting is they were co-CEOs and a lot of people were very critical and/or mocked them and said, "Hey, that'll never work." And so, I still remember in a brief conversation that I had with him, we got to chatting, because we took the elevator and then we were chatting and walking as we went into the conference. And so, I said to him, I'm like, "Everybody pokes fun at it, but it clearly works. So what is it that nobody is noticing?" And his answer was very clear. He's like, "One person can't lead a business." He said, "One person has one person's set of skills and experience and expertise and network and everything else." And he said, "And we're expecting people to run either multimillion or multi-billion dollar businesses with that, statistically it's not going to work. It's optimized if you go that way."

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And so, in our particular cases, one of the amazing parts about the relationship that Caroline and I have is that I really focus on ensuring that the delivery happens incredibly well. I'm the serial entrepreneur, I'm the operator, I've raised capital, I've also been an angel investor and a venture capitalist, and so that's my side of the business. And Caroline is amazing at articulating vision. She's incredible at working with our partners, our funders, our supporters, and really being able to always see three or four steps ahead, which makes us an incredibly strong compliment.

Leena Manro (: 10:19

Oh, yeah. It's beautiful.

Keith Ippel (: 10:20

But you do have to dial ego down and you have to dial a lot of personal passions down in order to make a co-CEO work. And so, I think what we found is it's always important to talk about just how it's working on a regular basis. Not just talking about the work, but how do we make it work? And I think that that has actually been a cornerstone for allowing co-CEO to thrive.

Leena Manro (: 10:45

I think there should be more of it. I mean, I don't know if our CEO has talked to you about our roles here at All Purpose, but often he'll talk about us being like a three-headed CEO team. Because Rob and myself and Jason work so closely together, but we compliment each other.

Keith Ippel (: 11:00

Exactly.

Leena Manro (: 11:01

And that's what's great. We have very different spheres we all work in. And then there are some areas where we will discuss, debate, analyze, and then come to a decision together.

Keith Ippel (: 11:12

Right.

Leena Manro (: 11:12

Always better than just one person having all that responsibility on themselves.

Keith Ippel (: 11:18

And I think it's so important for leaders in a business to start by knowing themselves, having that self-awareness of their strengths and their weaknesses, what they're capable of, what they're not, what they're willing to share, what they're not. Steve Jobs probably wouldn't have wanted a co-CEO. Terry Cook, I bet you I could have seen him with a co-CEO. And so, different people, different moments in time, but I do think it's always important. Our job is to maximize the impact that we have on our customers, on our partners, on our shareholders if we have them. And so, I think it's important for leaders to consider frameworks like this as a way to do that.

Leena Manro (: 11:58

Do you feel you are living your purpose?

Keith Ippel (: 12:04

Wow, that's such a great question. I'm not sure anybody has actually asked me that question before. For me, it has been fascinating. I grew up, my dad was a serial entrepreneur, I grew up around entrepreneurship. Interestingly enough, when I went to university, I said I'd never want to be an entrepreneur, but it was almost like me resisting the inevitable. And so, what was fascinating for me is from the very earliest days, my very earliest memories, I remember my dad doing philanthropic things in the classic way that people did back in the day, fundraising dinners, charity events, et cetera. And so, I was always drawn to that part of like, "How do you do good?"

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And so, for me, this world that I'm in now living my purpose, I actually feel like I am in that moment, as in I think my greatest strengths are at early-stage, the entrepreneur journey, getting through the messiness to get to clarity. And obviously to do that with people who are actively trying to make the world a better place, that's my passion, but also helping people to reconcile or compliment being an entrepreneur in doing that. And then the final piece is I do love to coach and mentor and support and help. I think back to when I was a kid, I'm not convinced there was ever a stray dog in our town because eventually they'd run by our house and then we'd take them in. And sometimes people, sometimes dogs, you know what I mean?

Leena Manro (: 13:42

Oh, wow.

Keith Ippel (: 13:44

And so, I do feel like that's just a part of who I am. But I do think in this crazy hyper speed world that we're in, I think entrepreneurs need to know that they're not alone and I think they need to know that they don't have to make rookie mistakes. Because, for sure, 16 other entrepreneurs have tried to do what they're doing, and so helping people to really get to clarity quickly I think is something that I'm deeply passionate about. So I'd say yes, I am.

Leena Manro (: 14:14

That is so beautiful.

Keith Ippel (: 14:15

Yeah. Thank you.

Leena Manro (: 14:18

And has your vision of what this was when you first joined and you first... I guess it was 2014 when you had joined?

Keith Ippel (: 14:26

Yeah, so we launched Spring in January of 2014. And so, when we started Spring, where we are today is that what we envisioned? Absolutely not. In that, the size and the scale of Spring, 12 years, 3,500 entrepreneurs, 1,200 investors, we've worked in 21 countries around the world. Yes, that. So I think the tagline is there. How we have gotten there, definitely radically different from what we originally thought. And the reason for that is because we're very customer-centric. And so, we're constantly listening to the customer.

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And so, what's fascinating is every industry, All Purpose Creative, Spring, everybody else, every industry has an innovation life cycle. What's fascinating is ours probably is the fastest in terms of innovation and iteration. Why? Because the customer is entrepreneurs. So they themselves are the innovators. And then they have needs, and so those needs evolve so rapidly that for us we've had to evolve in very rapid iterations. And so, 12 years in, Spring has had four iterations.

Leena Manro (: 15:44

Oh my gosh. That is amazing.

Keith Ippel (: 15:44

Customers are the same.

Leena Manro (: 15:45

Yes.

Keith Ippel (: 15:45

The intent is the same.

Leena Manro (: 15:45

Right.

Keith Ippel (: 15:45

The solutions, very similar, but the go-to-market and the how has evolved according to the needs of the customer. And so, we continue to try and do that.

Leena Manro (: 15:56

Four iterations. Yeah. I think that's happening with all kinds of companies and I think it's becoming faster and faster the need to iterate quickly, because the changing landscape. And also because of AI, because of technology and all. But let's go back. You said the innovation lifecycle and I'm not sure all of our audience knows what that is, so let's back up and explain. What do you mean by innovation lifecycle?

Keith Ippel (: 16:18

Yeah. So the premise is that every industry that exists goes through a cycle whereby new players, new companies, new actors come in and disrupt the solution side of the industry. They bring fresh ideas, sometimes technology, sometimes business models, sometimes pricing models. And so, that's one side of disruption. Another side of disruption can occur on the customer side. So one example that you and I can talk about is in the corporate world, and I'm going to speak a little bit out of turn, but my latest understanding is about 75 to 80% of the decision-makers now in the corporate world from manager level and up are either Gen Y or Gen Z. And so, they have different approaches to investigation of solutions, problem solving, selection processes, et cetera. So they themselves start to change an industry around. And some industries like serving entrepreneurs, very fast-paced, iterating a lot, but other industries not so much, but they still do move, which is quite fascinating to me.

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And so, I think it's always important for leaders to really ask themselves the question, what is the nature of that innovation lifecycle in their industry? When was the last time there was a massive sea change? And all you have to do is look at things like the S&P, look at the TSX top companies and say, "How many of those companies were top companies even 25 years ago or 30 years ago?" It's not. There's a rotation.

Leena Manro (: 18:07

Oh, yeah, there's a rotation there.

Keith Ippel (: 18:07

There's always a General Mills, or sorry, there's always a General Electric. I mean, technically General Mills too. But most often you see this cycle where companies start to emerge and take over and it's the ones that know how to adapt and thrive and stay true to their values and stay true to their mission that stick in the long haul.

Leena Manro (: 18:29

Yeah. It can be quite terrifying. It can be so terrifying though, because if you're not adaptable, you can think pretty quickly, unfortunately, if you're not flexible and you're not changing to the environment.

Keith Ippel (: 18:40

Right.

Leena Manro (: 18:41

You've probably seen that with a lot of the companies you're working with. Are you able to share what the success rate is for companies that go through an incubator? Or...

Keith Ippel (: 18:50

So it's a great question. Success rate varies according to the stage that we talked about. So often in an incubator program, you would anticipate to see about half fail very quickly. And that can go as high as 80%. And then in an accelerator, probably 25 to 60% will fail. And then in a venture studio, maybe 20% will fail.

Leena Manro (: 19:18

Let me go back a second.

Keith Ippel (: 19:19

Yeah, please.

Leena Manro (: 19:19

So you're saying companies, just startups without any type of accelerator or incubator, between 50 to 80% fail, new startups?

Keith Ippel (: 19:27

No. In the incubator or an accelerator.

Leena Manro (: 19:29

Oh, in the incubator.

Keith Ippel (: 19:30

Yeah. So here's the interesting thing, is that an incubator and accelerator, what they do best is they actually help to bring founders clarity. Is there really a market to serve? Is there really a problem to solve? Is anybody going to pay for it?

Leena Manro (: 19:47

Are they going to pay for it?

Keith Ippel (: 19:47

And here's the question that nobody talks about but exists in every program, which is, and do I want to do this? Do I want to be the one?

Leena Manro (: 19:56

Ooh, that's a big question.

Keith Ippel (: 19:57

And it is the question. And so, what's fascinating is you talked about change, right? And so, one thing that entrepreneurship teaches a lot of people is, what is their capacity to embrace change, to embrace innovation, to embrace, again, while you are friends at the cocktail party, pivots? How do you pivot? How do you adapt?

Leena Manro (: 20:22

Sharp pivots.

Keith Ippel (: 20:23

And sometimes very sharp and sometimes very evolutionary, which is fascinating. And so, it is important, I think, that... A lot of times we work with impact entrepreneurs, people who are actively trying to make the world a better place while trying to grow a successful business in lockstep. And so, what can often happen in an incubator, accelerator, is they're so committed to trying to solve that impacting a world-changing problem, that they say, "Well, everything else will sort itself out."

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And that can be the challenge, is to get them to realize that you can't change the world if you go bankrupt. You have to stay true to the mission, but while building a vibrant business that can scale to the level that you as a founder want to scale. Whether that's a solopreneur, whether it's a Fortune 100 company, it doesn't matter, you can change the world at different levels, but I think the important part is how do you build a business that thrives? And one of the ways to do that is to learn that innovation is oxygen.

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And this is, actually, I think the biggest opportunity right now for entrepreneurs and business leaders alike right now is we are all faced with change every moment of every day because of AI. AI has quickly become oxygen and it's changing every aspect of every business. And that's okay, there's nothing wrong with that. The key is it's building the DNA within the team, within the company and in the leadership as a founder maybe, where you say, "I don't know how to do this," but building a system and a process where you go from ambiguity to clarity, ambiguity to clarity, because great leaders know they very rarely have the answers. They know how to run the process to get to an answer. That's how you embrace change.

Leena Manro (: 22:21

Keith, you should write a book. Have you written a book?

Keith Ippel (: 22:24

Do people read books?

Leena Manro (: 22:25

People read books. People listen to them now.

Keith Ippel (: 22:27

Yeah, audiobooks.

Leena Manro (: 22:28

There's a lot of audiobooks.

Keith Ippel (: 22:28

Yeah. No, absolutely.

Leena Manro (: 22:30

Yeah, this is a beautiful... So much wisdom and so much from your many years, I think of coaching and guiding these entrepreneurs and startups and seeing it from so many different stages. I mean, I'm in awe and I'm kind of envious. I wish I had that kind of... Because many of us had to learn on the job.

Keith Ippel (: 22:52

Well, it's interesting, right? For you and I both, what we recognize is wisdom so often comes from A, experience, and B, pattern recognition.

Leena Manro (: 23:00

True. Yes.

Keith Ippel (: 23:00

And so, you've done that so often with so many clients that you've worked with at All Purpose. In our case, we literally have worked with more than 3,000 entrepreneurs.

Leena Manro (: 23:09

Amazing.

Keith Ippel (: 23:10

And what is fascinating to me is it is very rare that we come across a true unicorn situation where an entrepreneur faces a situation no one else has ever faced before.

Leena Manro (: 23:22

Right.

Keith Ippel (: 23:25

It's kind of fun, because sometimes people are like, "You're so wise." And I'm like, "I've just seen this five times before." But that is the important part as a leader too is to A, make sure that you experience it. B, that you yourself build that DNA on pattern recognition, but also inculcate it into your team. It's like help the team to recognize, always look for the pattern, always look for the pattern across customers, across partners, across product, across the impact that you're creating. These are things that we look for. And of course, nowadays, pattern recognition in tech and AI and everything that is happening.

Leena Manro (: 24:02

So what are some of the standout patterns that you've recognized and how are they impacting business today and maybe even in the near-term? Are you able to comment on that?

Keith Ippel (: 24:12

Yeah, it's a great question. I would say patterns that I have seen repeated in successful impact organizations, one is relentless pursuit of the customer. So always doing and repeating customer discovery if we, again, while we're friends at the next cocktail party, customer discovery is just doing that live interview market research constantly, just constantly listening to the customer, because that's how you catch when things are changing in the ecosystem, when their priorities change, when the patterns change, et cetera. The second thing is great entrepreneurs and great businesses know when to raise money and know when to grow revenue and know when to cut costs. And so, the key there is I would argue, and I don't know the exact stat, but I'm going to argue at least 90% of entrepreneurs and business leaders never took a formal finance course in school. Never.

Leena Manro (: 25:11

Yeah.

Keith Ippel (: 25:12

Very few.

Leena Manro (: 25:12

I would agree with that.

Keith Ippel (: 25:14

Great leaders, what they do is they get educated enough to at least be able to dig a layer or two deep and they surround themselves with great people who understand the financials as well, but it is incumbent upon a leader to at least understand the core of financials.

Leena Manro (: 25:31

Can you say it again? The three things. They must know how to raise capital?

Keith Ippel (: 25:35

Raise capital, grow revenue, and cut costs.

Leena Manro (: 25:40

And know when to do each.

Keith Ippel (: 25:41

And know when to do each. And that's actually, that is power.

Leena Manro (: 25:45

Oh, yes.

Keith Ippel (: 25:45

And what I mean by that is, it's power in choice, because so often if things are going up, sometimes people are like, "Oh, well, I'll just let it keep going up." But sometimes it's like, actually, now is the time to strategically take investment, which could be grants, loans, equity, could be many things, but the important part is like, how do I always think about how I control our destiny on this path to growth and success and impact? And so, but by thinking about revenue and funding and expenses, you can always ensure you're not painted into a corner by accident, that you maximize the opportunities and choices you have available, whether good times or bad. And I think that's key.

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And as leaders, I think we always are saying, "I stay true to the vision, that goal post, that compass, but the path to get there can be varied and winding and that's okay. There's nothing wrong with that." I would argue there's only one company that I can think of in the history of the world that was a pure linear from the day they started to the day to they exited and that's Instagram, right? It was 10 months, 20 million users, sold for a billion dollars. After that, everybody else has a journey down the river. But the key is to always embrace that, to then get to the impact you're trying to create.

Leena Manro (: 27:08

After talking to you, I just want to start up another business.

Keith Ippel (: 27:11

Oh my goodness.

Leena Manro (: 27:12

I really do. It's exciting. It's like [inaudible 00:27:15] the entrepreneurs.

Keith Ippel (: 27:16

It is so exciting. And when I was a part of starting Spring over 12 years ago, what was fascinating is we had a choice. We actually could have started a product business. And this comment about, we want to be entrepreneurs, but then we're like, "So how do we scale impact, like really scale impact?" So that was the interesting thing. That's actually why we created Spring as it exists today and not a product company. It's because we were like, "Well, we can create one company's worth of impact if we create a product company. But if we run an ecosystem builder, which fundamentally ecosystem catalyst, which is what Spring is, now we can touch hundreds and thousands of entrepreneurs and maybe that's a way to scale impact in either faster or deeper, more meaningfully."

Leena Manro (: 28:07

Absolutely. Let's go back to, because I think it's really powerful, this idea, because a lot of entrepreneurs, they don't think like this necessarily. It's the first time I've ever heard anyone put it together the way that you just did, the idea that you need to know when to raise capital, when to build your revenues, when to cut costs. What has been your experience where people have got that wrong? For example, when is it that you see... Do you see a great number of people when they don't understand this not cutting costs soon enough or relying too much on raising capital? Or...

Keith Ippel (: 28:43

Yeah. I mean, it's very rare that you and I could have a conversation where, like the one thing. I wish sometimes it was that easy, but first around fundraising, I think everybody has been exposed to some version of Dragon's Den or Sharks Tank. And so, there's no doubt that I would say the vast majority of entrepreneurs who become entrepreneurs are like, "Oh, no, I'm an entrepreneur, I've got to raise money from investors," because that's what they've been taught. That's what they've been trained through things like Dragon's Den.

Leena Manro (: 29:12

Right.

Keith Ippel (: 29:13

And so, first and foremost, it's important to know that probably less than 2% of all companies raise money from investors.

Leena Manro (: 29:20

Okay.

Keith Ippel (: 29:21

So first I would say, like a misguided approach, if I can say it that way, is that people believe they have an idea, now they need to go to investors. What they actually need to do is they need to validate their idea, then they need to go get a customer, then they can go talk to investors if it makes sense. And so, I think getting clarity on that very quickly is very important.

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I think the other one too is that a lot of times entrepreneurs believe that they need to have a bunch of money to launch. So whether they go to Futurpreneur or BDC or their friends and family or to angel investors or anything else, they're like, "Oh, well, if I'm going to launch well, I need 100,000 or I need 200,000." I've heard people say as much as three million to launch. And so, I always refer them to a company called Traveller Collective, Darryl McIvor is the founder, amazing entrepreneur, amazing human. And when he started he had, I'm going to speak a little bit out of turn here, but he had less than $10,000 to start the business. And he said, "I don't want to raise money." So what he embraced was he embraced the box. And the box is time, money, people, resources. And he said, "Well, my box is yay big according to the amount of money that I have." So that freed him to then make decisions accordingly.

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And so, my encouragement always when I talk to entrepreneurs is like, they're like, "Hey, I need to raise money in order to get to launch." And my comment always is, "That's not true. You can always get to launch." I know somebody who launched with $50, a business that grew to $2 million in revenue without raising a dollar of external capital. And so, my encouragement is there's always a path.

(: 31:14

And then on cutting costs, like your comment there is, the cliche term that I use is if you feel like the business is maybe starting to hop off the rails a little bit, like the car is starting to slide on the wet road, then my encouragement always to entrepreneurs is to say, "If it feels like things are going off the rails, they're not, they're already in the ditch. The best way as an entrepreneur to respond to crisis is to just embrace the crisis. And whether it's small or large, worry about the size of the crisis later." But the important part is to say, "Pause, we have a problem," whatever that problem is. And so, this is where cutting costs comes in, is because sometimes what happens is people say, "Oh, no, no, no, it'll be fine." Which is kind of code for, "I will sell my way out of the problem." And then they don't cut costs fast enough.

(: 32:08

And so, the number one cause of failure in businesses is not a bad idea, it's not bad founders, they just run out of cash at the wrong time. So I think that is the trick around that one, is you lose a customer, you lose a partner, macroeconomic changes like elections.

Leena Manro (: 32:25

Macroeconomic change. Absolutely.

Keith Ippel (: 32:27

Wars, right? And so, the important part for entrepreneurs is to say, "No, no, no, let's embrace it. Let's be explicit. Let's understand it. Then understand the scope and size, be very objective about it. And then we can be cost-efficient, we can be resource-efficient, and we can ensure that we can continue to thrive maybe down a slightly different or very different path."

Leena Manro (: 32:52

Wow. What are some surprising twists and turns that you've seen a lot of the entrepreneurs face? Are there some common ones that always sort of surprise them, but in your view, now that you've had so much experience, are pretty common?

Keith Ippel (: 33:08

Yeah, with hindsight.

Leena Manro (: 33:08

Yeah.

Keith Ippel (: 33:10

Yeah, that's a great question. I would say a few things. One is cashflow going tight surprises many entrepreneurs. Again, remember we talked about a lack of financial education that the average entrepreneur has? And so, I think having a really close eye on cashflow early on, that often will catch people the first time. They don't even need to be a second time entrepreneur. It catches you once, you'll never forget it.

Leena Manro (: 33:36

You'll never forget.

Keith Ippel (: 33:36

And so, that's definitely one. I would say the second one is when certain companies have really great early success, so they get a bunch of early customers, this is especially in business-to-business, sometimes direct-to-consumer, where people get some early customer traction and they're like, "Great, we're set. This thing is going to go." And then it just plateaus, because their assumptions about the size of the market were wrong.

(: 34:05

And so, definitely have seen that a lot of times where people get caught out because they're like, "Oh, the market is this big." And so, what that can do sometimes is it can force them to, for example, do geographics expansion faster, think about new market segments faster, right? So you start to see those things. I mentioned Traveller Collective earlier. This is such a great story. If anybody wants to check it out, travellercollective.com. And he started selling keychains, where what you could do is you could put these little metal disks on one side of the keychain with the country code of every country you've ever visited. And then they added national parks, et cetera. And so, what was fascinating is they got to a certain level and then it plateaued. And so, then Darryl and the team were like, "Huh, I wonder what happened?" So they started looking in their customer data and then they actually realized that a lot of the customers were women and the team was like, "Huh, didn't expect that many women to want a keychain."

(: 35:03

So they started reaching out to the customers and they're like, "Hey, so were you looking for a keychain?" And almost all the women were like, "No." And this is a funny thing for an entrepreneur to say to their customer, they're like, "So why did you buy it?" They're like, "Because it's the only thing you offered." And then he's like, "Well, what would you have wanted?" And they're like, "Well, how about a chain?" So then three weeks later he had a chain where you could put the discs on the chain and I think his revenue doubled in like four months.

Leena Manro (: 35:32

Oh, wow.

Keith Ippel (: 35:34

So they had an assumption, bunch of guys buying, guys weren't buying, not in the way that they were expecting, but women were in the ways they weren't expecting, so then it caused them to have to pivot. But that was the surprise. It was like, "Plateau, what do we do?" And again, it goes back to that earlier conversation that you and I were having a pattern recognition where Darryl and the team didn't have the answer, but they knew how to get to the answer, which was go back to the customer, interview the customer, find out what has changed. And so, I think that's so crucial.

Leena Manro (: 36:06

That's incredible.

Keith Ippel (: 36:07

So that would be the second big surprise. And then the third one, and I'm hoping I'm going to make you laugh when I say this, the third one is the surprise when they find out that investors don't like their company and they're not interested in investing. Because as a founder, when you birth a company, it's your baby.

Leena Manro (: 36:26

Right.

Keith Ippel (: 36:27

But when you have a real baby in real life and you walk down the street with a stroller and you ask everybody if your baby is cute, they'll say yes. Whether they're just being polite or not, I don't know. But when you walk down a row of investors and you say, "Here's my baby," they're more than happy to tell you that it's ugly. And so, I don't like the space, I don't like your business model, you're not different enough from the competition, like everything. And so, that is often a shock to entrepreneurs, because it's their company, it's their baby, they believe it, they breathe it, they bleed for it. And so, then to find out that 90% of investors have no interest whatsoever is a big surprise. And so, yeah, there you go.

Leena Manro (: 37:08

Well, okay, this is so great. All right, the three things, just to recap, correct me if I haven't said this correctly, but one, the shock would be not having enough, running out of cash flow before they thought they would. Another one is early successes and-

Keith Ippel (: 37:26

As a mirage.

Leena Manro (: 37:27

As a mirage. And I bet early success also can create a bunch of false confidence as well, maybe even excessive spending, bad habits. It's like this, it's always going to be like this, right?

Keith Ippel (: 37:37

Absolutely true.

Leena Manro (: 37:38

And then the third one being not prepared for people not to fall in love with your baby, criticize it, break it down, tear it down.

Keith Ippel (: 37:45

And the reason too, just to extend that last one, is because when you're fundraising, you're already a founder or a CEO of a company, and so you have a full-time job. So in reality, most entrepreneurs, what they want to do is walk up to a person and treat them like an ATM and they're like, "I'm raising $500,000, safe agreement, withdraw." They want it to be just that fast, because they believe their company is amazing. Once they find out that the majority of investors don't like their company, now they know they have a full-time job on top of a full-time job.

Leena Manro (: 38:21

Oh, dear.

Keith Ippel (: 38:21

And the faster that they can embrace it and say, "You know what? This is an opportunity," then the more successful they are in fundraising.

Leena Manro (: 38:29

Amazing. So I will definitely not say who, but I know of someone, sort of a friend of a friend who I feel like fell victim to all three, somebody who was-

Keith Ippel (: 38:39

Not uncommon.

Leena Manro (: 38:40

Yeah, who actually had early successes, just like early in life, so young. Early successes, early in life, maybe got bored with the success and the money and the millions and all that. "Oh, I wish that was a problem. I wish that was a problem we had. I wish that was a problem I had." But anyway, early successes a little too young, and I think that's like a life lesson thing. When you're in your 20s and you're not achieving massive success, it's actually a blessing.

Keith Ippel (: 39:05

Mm-hmm.

Leena Manro (: 39:05

Right?

Keith Ippel (: 39:05

Yeah.

Leena Manro (: 39:06

But anyway, so early successes, starts another business, lots of confidence with a second business, burns through cash in the second business. And I mean, again, I'm hearing the story through a few layers, but I think anyone who has been in business or has some years ahead of them could see this going downhill fast from a mile away. And then the third, I remember when I heard what it was, I was like, "Oh, okay. Clearly somebody had an idea, it was their baby, they put a lot of their own money in, thought it would take off and that's not what's happening." So sometimes all three could plague you.

Keith Ippel (: 39:46

Yeah. Well, it's interesting, you technically have added a fourth thing in that mix, which is when the mistake of entrepreneurs investing-

Leena Manro (: 39:55

Let me ask, your own money?

Keith Ippel (: 39:58

Your own money.

Leena Manro (: 39:58

Your own money, yes.

Keith Ippel (: 39:59

Too much of your own money. And so, the comment that I always say to entrepreneurs is, "Look, for every $100 you want to invest in your company, you put $50 in, and then you put the rest in your mother's mattress, because you don't live there and you don't have access to it." And the reason is because what entrepreneurs don't realize early is they are the bank of last resort.

Leena Manro (: 40:22

Oh, yeah, that's true.

Keith Ippel (: 40:22

Because when things go south, the only person who's going to invest is the founder. So you need to make sure that you're protecting your capital to have it ready in case things go sideways. No, sometimes it's the other side where a huge opportunity emerges and you may choose to invest, but the greatest test of whether or not that's a huge opportunity is whether or not you ask other investors to invest, because if nobody else will invest, are you the only person in the world that understands that opportunity? Statistically, no. So I think that's important.

(: 40:53

And you were talking about, "Hey, I know of a story of someone who..." I'll give the very direct example. I know an entrepreneur who was successful early, they had their next idea, they thought it was the best idea ever, they kept it close to the chest. They invested $4.4 million to build a minimum viable product and put it into the market with zero customers and zero revenue, 4.4 million because they were that sure.

Leena Manro (: 41:23

And?

Keith Ippel (: 41:23

It failed within a year.

Leena Manro (: 41:25

It failed?

Keith Ippel (: 41:26

Within a year. Went bankrupt. And so, that's the extreme example, right? But I do think it's important to note these little scenarios that you and I are talking about, all of these are easily avoidable when you surround yourself with an amazing community of like-minded entrepreneurs who have their different levels of accumulated wisdom and remember that whatever situation or opportunity you're facing, chances are 16 other entrepreneurs have faced it before. It's a chance to reality check, gut check, avoid a rookie mistake, avoid hubris, over optimism, whatever you want to call it.

(: 42:08

But that's the key, is when you surround yourself with great people, then you have the ability to sidestep these and/or have somebody catch you before you fall off the edge. And that's, I think, really critical. And it's one of the reasons why we started Spring, is because I had been a three-time entrepreneur prior to launching Spring Activator. And so, for me, by the time I got to Spring, I was like, "All those things that I had to learn the hard way, other people have had to learn the hard way." And I knew, I looked around and saying, it's like by the thousands, entrepreneurs all have to try and "figure it out themselves". It's a myth. Let's overcome that. Yeah.

Leena Manro (: 42:51

Brilliant. What is one thing you would like for our listeners if they're thinking about an idea or maybe they've gone into business on their own, something you'd like them to know about maybe about entrepreneurship and/or about Spring?

Keith Ippel (: 43:10

Yeah. Entrepreneurship is hard. It's incredibly rewarding, but you need to be grounded in your vision and your mission and your why. You need to make sure that your family is 100% bought into that and you need to talk about it regularly. I think that's critical always for an entrepreneur, because again, good times and bad. Hey, when it's good times and you bring a sports car home, fun. But when it's not, everybody is along for the ride. And so, I think always making sure that you have buy-in. I think the companion to that is build that community of CEOs around you who've been there, done that. Those are essentials, I think. It's my advice to entrepreneurs out there. I would never go back to the corporate world. Never. It is just this drug of entrepreneurship, right?

(: 44:07

But I think if I want people to know something about Spring, is that Spring is that community. If you want to make the world a better place and you either don't know how or you've been doing it for 10 years, Spring is your community and we meet you where you are. So whether you're trying to grow revenue, whether you're trying to sort out a mess, or whether you're trying to raise a meaningful round of investment capital, we'll meet you where you are. And if we don't have it, we'll refer you to the right person. But the important part is don't try and do it alone, because there's no need to, because there's an amazing community of entrepreneurs and experts and investors out there who want to see you succeed, because they want to see you create the impact that you believe you will create. And I think that's crucial.

Leena Manro (: 44:59

You're such a wise, older soul. You know that? It's on a soul level. [inaudible 00:45:04] I appreciate that.

Keith Ippel (: 45:05

See, the people in the podcast don't know my haircut. So that's the key when you say that. I'm just saying everybody, watch the photo.

Leena Manro (: 45:11

From a soul age, not from a physical year. I meant like old soul.

Keith Ippel (: 45:15

Right?

Leena Manro (: 45:17

From a soul perspective. So we'll have the link to your website and details on when we upload everything, but if people want to contact you, say on LinkedIn, are you okay with that, reaching out to you?

Keith Ippel (: 45:29

Absolutely. Yeah. And the benefit they have is there's only two Keith Ippels in the world.

Leena Manro (: 45:31

Oh, that's wonderful.

Keith Ippel (: 45:31

And the other one is my dad, so...

Leena Manro (: 45:31

They can talk to him too?

Keith Ippel (: 45:34

They can talk to him too, but he's the Bellville Keith and I'm the Vancouver Keith. There you go.

Leena Manro (: 45:39

Okay, so you're the only Vancouver Keith?

Keith Ippel (: 45:39

I'm the only Vancouver Keith.

Leena Manro (: 45:41

Wow, that's wonderful.

Keith Ippel (: 45:42

Right.

Leena Manro (: 45:43

Well, thank you so much for being on our show.

Keith Ippel (: 45:45

I appreciate the time. Thank you. And thank you for doing what you do.

Leena Manro (: 45:49

Boy, I would say the same too. Thank you so much, and thank you Spring for doing all the things that you guys do.

Keith Ippel (: 45:52

Appreciate it.

Leena Manro (: 45:53

If you'd like to sing with me, you can, but you won't, hey?

Keith Ippel (: 45:55

No. Yeah. If everybody needs to know, I have many gifts, one of them is definitely not singing.

Leena Manro (: 46:00

I'll do it for you.

Keith Ippel (: 46:01

Thank you.

Leena Manro (: 46:01

Keith and Spring are Up to So Good. I mean, that wasn't good singing, but-

Keith Ippel (: 46:07

That was great.

Leena Manro (: 46:07

It's just a thing we do.

Keith Ippel (: 46:09

Well done.

Leena Manro (: 46:09

It's a thing.

Keith Ippel (: 46:10

Well done.

Leena Manro (: 46:10

All right. Well, thanks so much. And thank you everyone for joining us. Well, that's all the time we have for today's show. Thank you so much for joining us. And if you've enjoyed the show, please subscribe, hit the like button or share an episode. And if you have any feedback, questions, or comments, or show ideas, you can email us directly at hello@allpurpose.io. Thank you once again for joining us. We'll see you next time.