He raised $20M, hit $3.5M in revenue—& failed. Here are the top 3 lessons he learned. | Ned Phillips, Founder of Bambu

Ned had a chance to run Robinhood Asia but he turned it down. Instead, he launched a competitive product. He decided to go B2B and sell to banks and other financial institutions. He locked down a $400K revenue sale before writing a line of code. It seemed easy at first. Overtime, he grew to $3.5M in revenue, billions in assets under management and hundreds of thousands of users. He raised $20M in venture capital.

But then the problems started. Enterprises that paid for large contracts didn't push the product—many had no marketing budgets. In some cases, they shelved the product altogether. The one-time revenue never turned into ARR. Running out of money, he was forced to raise a small bridge and lay off more than half his staff.

He came close—but ultimately, he just wasn't able to recover. He sold off the company for parts and went through a wind down.

This is his story—and the lessons he learned.

Why you should listen: 

• Why the difference between success and failure can be minimal.
• How to balance custom contracts with building scalable product. 
• Why enterprises might not push the product they've paid $100K+ for.
• How to build a strong company culture.
• Why layoffs are the hardest thing a founder will go through.
• When things go south, "the days are long, but the months are short".

Keywords
startup, FinTech, B2B2C, customization, revenue models, marketing, client engagement, leadership, company culture, lessons learned, B2B sales, startup challenges, emotional toll, liquidation, lessons learned

Chapters

• 3:22 Passing on Robinhood
• 7:38 Going B2B vs B2C
• 24:23 Why constraints are frustrating but helpful
• 29:19 You're Either Saving Money or Generating Money
• 36:11 A Lack of Focus
• 39:52 The Days are Long, the Months are Short.
• 44:42 Going through massive layoffs
• 51:45 Lesson for Founders
• 54:19 Should Founders Never Quit?

Transcript

Ned Phillips (00:00:00):

How I think about it is, if you're good at custom, take a choice. and it's extreme. Either say no and don't do it and stick to your product or say yes, but charge masses like multi millions, 5 million for the customization. No way you could Fit up. You know, this phrase: “build it and they will come.” Oh man, no one's coming. Like, no one, not even your mom's comment. I mean, no one's coming, no one's using this thing unless- one of the dangerous things about having capital is that it gives you fuel for your new ideas when you should just be doubling down on your same idea. Bambu was the best of times, it was the worst of times. It was truly the greatest thing I ever did in my career. The lows of lows, when you understand that nothing's coming out. And after it failed, I did spend a couple of months in my bedroom crying.

Previous Guests (00:00:45):

“That's product market fit, product market fit, product market fit. I call that the product market fit question, product market fit, product market fit, product market fit. Product market fit. I mean, the name of the show is product market fit.”

Pablo Srugo (00:00:57):

Do you think the Product Market Fit Show has product market fit? Because if you do, then there's something you just have to do. You have to take up your phone, you have to leave the show five stars. It lets us reach more founders and it lets us get better guests. Thank you

Pablo Srugo (00:01:11):

Ned. Welcome to the show, man.

Ned Phillips (00:01:12):

Pablo, thank you. I appreciate it. I have been quite a long time listener to your show, so I appreciate you having me on.

Pablo Srugo (00:01:18):

That's awesome, man. It's great to hear. And you know, you have a fantastic story. One of those like,- if I just were to rattle it off, I'd say $20 million raised, billions of dollars in AUM for your platform. Quarter million users, 3.5 million in revenue. I think anybody would assume that the ultimate end of the story is a huge success. But not in startup land man, it just doesn't always work that way. And this is why we are doing these types of episodes because if you dig into it and so many people now, they're just not willing to really share it when it doesn't work, even though 95% of the time it doesn't work, but they don't wanna share it. So I really appreciate you coming on the show and, and being candid with us and sharing it. I had a story like this myself, and I think it's just important for people to see how many things can go right, and then things still not end up as a huge win just because it's such a great learning opportunity. So anyways, thank you for coming here and sharing this with us. It's gonna be great.

Ned Phillips (00:02:20):

Hey, I appreciate it, Pablo. You're right. Every startup person, when they start thinks, okay, I know how this story's gonna end. I'm gonna make billions. This is gonna be awesome. And you know, I believed that for almost all of it. And you have to, and you're right. I think obviously, look and I'm happy to share all, I'll take it on the chin for the mistakes we did make and you know, the ones that we got, right? But yeah, ultimately it doesn't take a lot of wrong moves. And suddenly that door is shut on you pretty hard.

Pablo Srugo (00:02:49):

Well, the difference between right and wrong- I mean, obviously there's some things that just never get off the ground, never really work, but the ones that actually, you know, get revenue, get customers, raise some money, the difference between those and the ones that turn into huge successes is often a lot less than you might think. Like a couple of different moves, a couple of different macro situations, things that sometimes have nothing to do with business. So anyways, we'll dig into it. But maybe just let's start with kind of the backstory here. Like how do you get into Bambu, this kind of Robinhood-like kind of play, but, B2B to banks in the first place?

Ned Phillips (00:03:22):

Yeah, appreciate it, man. I'll give you my one minute story. So, because I think it is always important, I dunno how many people just wake up and think I'm gonna be a startup founder. There's always a journey there. So yeah, look, I'm 57. You can maybe tell from my accent. I'm from the UK. I moved to Asia when I was 22, so I have been in Asia for 35 years, Hong Kong, Singapore, Indonesia but mainly Hong Kong, Singapore, and, you know, have loved it. I spent 27 of those years in corporate working in both stock exchange technology, wealth and trading technology. I ran E-Trade for some of your listeners who are a bit older, they remember that Robinhood wasn't the first online broker. E-Trade Charles Schwab. Companies like that. TD from Canada were there as well.

Ned Phillips (00:04:14):

And I ran E-Trade Asia and you know, I had a great corporate career and then at 48 I was kind of, certainly not retired, but in between jobs, trying to figure out what to do, in a bit of a midlife crisis. And so you mentioned RobinHood, this is 2015? you can see FinTech was happening. And I got introduced to the Robin Hood founders and they were out in Asia looking to grow Asia. And I met them and they were like, ah, maybe you'd be interested to run Asia, ah, Pablo. And you talk the choices of life could be thin, man., I remember thinking, what do these kids know? Come on, I can do this myself. I remember,  Pablo, thinking, how hard can this be? Oh man, did I find out I was, I could see FinTech. This is 2015, you know, I'd been in FinTech, I had done E-Trade, which was an online broker from the 90s. We hadn't coined the term FinTech. I'm a sales guy. I run businesses. like a lot of founders. We're delusional. We believe we can do anything. So I believed I could do this. 

Pablo Srugo (00:05:21):

You have to. I mean, that's the only way. If you don't believe that, you don't start in the first place a 

Ned Phillips (00:05:24):

A hundred percent, isn't it? Maybe for a different conversation, there’s this illogical situation that you have to believe you could do it. Whereas everything points to the fact you've got no hope at all. and so after I kind of didn't do the RobinHood thing, robo Advisory had, you know in Canada, you know, Wealthsimple,  Betterment, Wealthfront. in Asia, the very first guys to try it was a company called Eight Securities. They were my former colleagues from E-Trade, they had built a B2C brokerage. They were now going into Robo-advisory and they did B2C robo. And they said, Ned, would you give us a bit of advice for six months, see if B2B is a thing? And I was like, sure. So I went in and quite a few in financial institutions said, yeah, we'd love this new idea of a robo. But you know, Pablo, I mean you're an investor and I'd be interested in your views, B2C technology and B2B is totally different just because, you know, you can't take a B2C firm and just ram it into B2B. 

Pablo Srugo (00:06:22):

and this was to be clear, like a B2B to C. Is that a good way to think about it? like an engine that then, you know, whatever bank would then push out to their own customers? 

Ned Phillips (00:06:30):

Yeah, I mean, look, so at eight Securities, it was B2C, this was the company that I was at for six months. And basically it was clear that they didn't wanna do B2B. I said, I'm gonna go off on my own and do it. And so yeah, what I started was Bambu, it was B2B to C. So the simplest way to think about it is, if any financial institution and asset manager or a bank wanted their own robo-advisor for their end customer, we would build it for them. So the pitch was, you see Betterment, you see Wealthfront, it's gonna eat your lunch, you need that, we'll build it for you for your customers. And we built mainly the technology. So rather than just the portfolio management, we built the application, we integrated it to brokers custodian, our pitch was, you know, you don't know how to build these kinda mass retail robo-advisory solutions. Yeah. So that's what we started. And as you mentioned, you know, we grew it, we raised 20 mil, we got close to 20 mil of revenue, we had billions of revenue, quarter million customers, some of the biggest banks in the world. And yeah, but didn't quite make it out alive.

Pablo Srugo (00:07:30):

And, maybe just as a first question, what makes you decide to go the B2B route instead of just copying the models that are working direct to consumer and just doing that?

Ned Phillips (00:07:38):

You know, I had been at E-Trade when it was B2C, I knew B2C is hard, like a little bit of naivety Pablo, I hadn't really done B2B so much before, I'd done B2C. And I was like, I'm gonna have to raise hundreds of millions to support the - I mean, I'd seen E-Trade what it took. And you know, when I was in E-Trade, we nearly went bust several times and that was like a listed company. And I was like, I dunno, man, this looks hard. And eight securities that I was at, which ended up getting bought by SoFi, I mean they were struggling. And the B2C, you know, betterment wasn't profitable. Wealthfront wasn't profitable. This is 2015 coming into 16. No Robo was making money. So really it was that, I think it felt a lesser of two evils to be honest. 

Pablo Srugo (00:08:22):

So what's the first step at this point?

Ned Phillips (00:08:24):

Do you build it, then sell it or sell it, then build it? I'm a sales guy. No prizes for guessing. I put together a pitch deck and I was super product clear. I got a few Figma screens. It was actually called Envision. The company Figma wasn't around. 

Pablo Srugo (00:08:40):

Yes, yes, I remember that.

Ned Phillips (00:08:41):

Remember Invision? 

Pablo Srugo (00:08:42):

a hundred percent I've used it.

Ned Phillips (00:08:43):

Hundred percent. So I put together a few InVision screens with a robo-advising looking application. I found a company to build the front end. I then found a company to support the backend. So the backend means buying and selling the ETFs, integrating it. And I took that deck and I said, Hey guys, I have nothing. It's gonna look like this, but if any of you'll pay me to build it, I will build it. And within a few months, I got a $400,000 deal

Pablo Srugo (9:07)

from?

Ned Phillips (9:07)

An asset manager to build them robo straight out the gate.

Pablo Srugo (00:09:10):

And I guess these would mean you had relationships before from the E-Trade days and all that sort of stuff, right?

Ned Phillips (00:09:15):

You know, Pablo, people say, why did I start in Singapore? Why did I start in Asia? I mean, look, it's all I know. Like if I turned up in Canada, nobody knows me. I've been selling in Asia for 30 years. Like, I don't know everybody, but I know enough people. And absolutely, I just think that's really important in finance. B2B I'm 57, you know, people, some of my peers are running institutions, right? They're running places. So I didn't get the biggest, it was a small company called Crossbridge Capital. And so here's what I had. I'm three months in, I have no product, I have a $400,000 deal. And I go out and say, Hey, I have revenue pre-product. I mean, look at us.

Pablo Srugo (00:09:54):

There's no better place to be. There's no better place to be that early on.

Ned Phillips (00:09:57):

so then I raised the seed round of another 400,000 on a Safe note. not a fan of Safe Notes. I think they have their trap bills. And then before I knew it, I had like 800 grand. It was just one employee and a marketing person. And the funny thing was Pablo, I then deployed another marketing person, another sales person, because I'm not a product guy. And I hate to say I had product market fit, but I'd sold something and then me and these salespeople would try to find coders to deliver what I had dreamt up to sell. 

Pablo Srugo (00:10:24):

did that customer, they pay up front or they committed to buying in?

Ned Phillips (00:10:28):

Half upfront half, we said we would deliver within six months and, you know, we would get the second half if we deliver. We were like, all right, let's go. 

Pablo Srugo (00:10:36):

Well, at least you have a clear plan, which is more than what most, you know, pre-seed stage startups have in that stage, right? 

Ned Phillips (00:10:43):

But Pablo, and this is the interesting part, we were then guided- our product ended up being quite guided by their slight, they wanted slightly different. We were like, what about this? They were paying. And once we got that before we delivered that, we then landed Thomson Reuters, you know, Thomson Reuters, the data provider. So we landed them, and then we landed Standard Chartered within the first year. So suddenly we're like,- and they all wanted something slightly different. And I think this is possibly, and I'll explain why we didn't make it out alive. The single reason is that our product kept getting customized for every customer. And I'll take that blame. I love selling, I love deals. When the customer said, oh, could it do something slightly different? You know, you're actually, so we got a few smaller deals, a 100K, 200 K deals. And then about a year in Malaysia's biggest bank offered us a seven figure deal to build something that wasn't- it was wealth management, but it wasn't exactly what we did. But what are you gonna do? You, you know, like,

Pablo Srugo (00:11:40):

I mean,it's a great question, right? Because, so on the one hand, like I've heard, you know, some people go blanket and they kind of just say never build custom software. And you know, the reality is like, I've had StackAdapt on this show. They're doing $400 million top line now. And they started with custom software, right? So like, it's not that black and white. How, like, since you've gone through it, how do you think about that, right? Like where do you, I mean, seven figure deal like that early on is kind of, how do you say no to that, right? So like, how would you think about it Now if you could go back in time. 

Ned Phillips (00:12:09):

So, we had built some product, we had built a basic white label product with some APIs, and we always- you know what we did, Pablo, we convinced ourselves that, oh, it's okay, we'll use our APIs, therefore we're really selling product. But we were getting, you know, a lot of integration fees. You know, I, I have lied awake at night and stared at the ceiling sync, what if I said no to these custom deals and just sold my product? Would I have been a unicorn in the end? You know, blah, blah, blah, blah, blah. I, I don't know what the right answer is, man. And I definitely cried some tears and sweated some stuff over this because right at the end of our eight year journey, our product really started to pick up and we were using a lot of our product here. Here's how I think about it now.

Ned Phillips (00:12:52):

when startups, you know, I've been super open. I'm happy to dive into all the details, is that I think about it, if you're good at custom, take a choice. and it's extreme. Either say no and don't do it and stick to your product or say yes, but charge masses like multi million 5 million for the customization. No way you could F it up on that. 'cause We were charging a 100K, 200 K, six, nine months of development. We hired another developer to deliver it. Sure. It was based on our APIs. The middle road is what kills you. The middle road of taking a 100K, 200 K for customization, that takes six months. You end up losing gross margin to get this magical ARR that every VC wants. But what happens is, our first client got live and started to get some ARR but our second client, it went live and then they said, oh, we don't have any marketing budget now, so we're not gonna market it.

Ned Phillips (00:13:47):

We're just gonna put it on the shelf. And I'm like, no dude, no, I've actually taken a loss on the gross margin because I had to put more effort, I did too much customization to get it live. And here's the thing, you know, it's about to go live and your customer says, oh, I need this one more feature. And you're like, well, no, no, it wasn't in the, it wasn't in the statement of work. And as a startup you say, can you pay for it? They say, well, our yearly budget's gone. And you're like, so what do we do? And they're like, well, it won't go live without this feature. If it doesn't go live, you don't get ARR if you don't get ARR You don't get investors from VCs. And that's what I would tell myself. I need to either say no or charge so much for the custom that even if it doesn't go live, we're all happy

Pablo Srugo (00:14:30):

You've earned it sort of thing. 'cause The other thing is too, is like if you end up having all these disparate kind of semi-custom instances, it's a drag, right? It's a drag on your business because you've gotta maintain all that. It's one thing to say, well what does it really take to kind of get these new features for this customer? It's not that much fine, maybe still make some margin on it, but now you gotta maintain that for that customer only, and you're supposed to build a scalable business. So like you have to-  there's no black and white in, in startup land and you kind of have to fake it. You, you gotta fake it to make it a little bit. So it's like,

Ned Phillips (00:15:01):

And, and, and, and what happened with us and you are right. And I think, while it seems so obvious to me now that you build either multi-tenant or single-tenant and the way that single tenant works, I didn't come in as a tech founder, but also right after we got Standard Charlotte, we got Franklin Templeton, then we got HSBC, then we got principal asset management,

Pablo Srugo (00:15:20):

Huge brands,

Ned Phillips (00:15:22):

Huge brands. And hey man, I'm just not strong enough to turn it down, man.

Pablo Srugo (00:15:27):

I don’t think I would be either. <laugh>.

Ned Phillips (00:15:29):

And you could see then we got a one and a half million raise, then we got a 3 million raise. We were kind of, I hate to say the darlings and I pushed very hard on this. You know, I love the idea of sales and brands. We were winning awards on stage. The hype train was running, you know, we were very clear with our numbers. I mean, you know, we're just getting to a million of rev, one and a half, but at least half of that, three quarters of that was implementation. And you know, you know what investors think about implementation. I actually tell founders today, implementation revenue is not money. It's not zero, it's worse than zero. 

Pablo Srugo (00:16:02):

you have to, you know what actually, as I'm just talking out loud here, like implementation revenue, you might want to think of it as financing, at least from the perspective of VC, it'll get a zero multiple. It literally will get, will count towards where you're at, right? Like, so even another, you say I have 2 million in revenue, million and a half is implementation revenue. As far as I'm concerned, you're at half a million in revenue. Like literally that's how I would look at it. But it's money that you can use to fund things. So you, you almost should think of it like that. Like it's a way of customer financing and to the extent that that's where the margin has become so important. 'cause If you take a million and a half in implementation revenue that no VC is gonna value and you spend a million and a half against it to deliver the product, you're financing your net financing from that customer is zero <laugh>. 

Ned Phillips (00:16:43):

and I agree with you with your zero Pablo, but this is something I didn't understand and lesson’s learned because you put in your deck, you have 2 million rev, you're actually putting something that's true, but creating a false - not a false, but creating an impression unless you state it so clearly, unless you state, Hey, I have 1.5 million implementation and half a million ARR, but quite a few come forward because every startup wants to impress. So you say two and then you get discounted even more heavily. So yeah, you know, we found ourselves after a couple of years growing and starting to get ARR and starting to get traction, but probably the hype train sprung ahead of us with the big logos that we had.

Pablo Srugo (00:17:25):

And how do you manage through that? Like the other thing about enterprise, the other thing about B2B to C I guess I should say, is getting customers, you mentioned this a little bit, like it's one thing to get say HSBC whatever, to decide, yeah, yeah, let's do this quarter million, half a million, whatever. That's hard. But, it's one thing to do that, it's another thing for them to say, we'll deploy it and then it's a final thing for them to actually get behind it and get usage on it, which is ultimately like what you truly need to succeed. How did that part play out? I mean, you had a lot of assets under management, so I, I assume some of them went right, but how, how was that part of the equation?

Ned Phillips (00:17:58):

Man, you know, lessons to my younger self and my younger self is a 53-year-old Ned that could, now I'm a 57-year-old Ned. So here's what I didn't figure out. I was so happy to get a deal that we didn't ask them. What I perceive now as a critical question, if you are paying us a million dollars to build this for you, what's your marketing budget for it? We didn't ask that question. We should have said, do you have a marketing budget? And in reality, if they say, no, we don't, we're just gonna see what happens. Honestly, be super careful because- there's no ill will. It's not like a bank's like, ah we'll get this startup and not launch that product. Everybody believes, everybody wants it. It's not-

Pablo Srugo (00:18:35):

Yeah, yeah. They'll benefit from that. That's right.

Ned Phillips (00:18:36):

There's no benefit. But what we found was, so there's probably two or three reasons. We had some clients that really did go live, not just live, but worked. We had a quarter of a million end users, the Malaysian bank I mentioned, fantastic went live or you know, they had 200,000 users on it. Standard charter went live. Franklin Templeton a lot. Number one, you have to deliver it. So on the startup it has to be delivered. And that's partly startup and the bank together, right? You have to work together, get through security, everything. Secondly, it has to be a good product. Customers have to want to use it and use it quickly. So when it goes live, if after the first couple of months the numbers suck, it's very easy for that to get put on the shelf. And the last thing is you really wanna ask them, do you have a marketing budget?

Ned Phillips (00:19:19):

Because you know, this phrase, build it and they will come. Oh man, no one's coming. Like no one, no, no, not even your mom's coming. I mean, no one's coming, no one's using this thing unless the bank puts it front and center. And I think, you know, it's uncontrollable. So yeah, you know, the show's called Product Market Fit. We got product market fit in terms of what we built and banks wanting to use it and with some of our clients. 'cause Yeah, we got to a few billion of AUM, we got that. But you know, it doesn't take many that you- we had some clients three years in, it's not live, you know, because things change. Things happen. Different expectations on launch. We are now so in the hole, yada yada, yada, you know, the tech- and another lesson we learned in the early days, and if there's an early stage startup listening, you know, you wanna get product market fit, so you want them to buy it In enterprise, you're building out a statement of work, which is what you do.

Ned Phillips (00:20:19):

And it's very tempting as a startup to say yes and make the statement of work light and easy to get them to sign it. Oh man, it's just gonna put a dagger on your heart later on. Because if you are not clear on what you wanna build, when it comes to the push and shove of who's paying for that extra feature, it ain't the institution it’s the startup. Not because the institution's big and bad. It's that their budget's been locked down for the year and they don't have another 100k. And if the SOW isn't clear, you are leaving yourself open. And honestly, so the first client I built before I told you I charged 400. my biggest competitor when I talk to them about it, they're like, we don't get outta bed for less than 5 million. What are you doing?

Ned Phillips (00:21:01):

Did you promise? Did you promise what we built for five, for 400? I'm like, no, no, no. It was totally different. I'm like, oh Jesus Christ, I think I did. So that's the other thing, you know, you are so keen to get the deal. You are willing to push the boundaries of what you are customizing in a good way to make it happen. And for some of them it flows fine, but the ones that don't, you're gonna find yourself if you want it to go live. And sometimes you can't just walk away from it. 'cause You know, you sign a contract, so you have legal responsibilities. So you gotta keep building. And you know, we kept getting funded. So the interesting thing Pablo, was we kept getting funded, which meant

Pablo Srugo (00:21:36):

You're saying from investors, from VCs?

Ned Phillips (00:21:38):

From VCs as well. Yeah, we got from VCs and which meant we could hire more people to do the custom work for the bank to get it live because we win more logos and more logos, more money, more VC. But really we're probably building- 

Pablo Srugo (00:21:52):

How many people were you like at peak?

Ned Phillips (00:21:54):

120.

Pablo Srugo (00:21:55):

Wow, okay. And these are like remote, like, you know what I mean, in terms of like us from a US perspective or those kinda the US payrolls that you got, you gotta think about,

Ned Phillips (00:22:04):

Oh hey, so Pablo, I adore the US. My kids live in the US but oh my god, I can't hire people in the US. The cost is outrageous.

Pablo Srugo (00:22:12):

It's 120 people at a 100k. That's a lot. Yeah, yeah.

Ned Phillips (00:22:14):

You see, in Asia, I'm gonna say, hold on, let me think in Asia, okay, okay. Oh, see, I used to earn more than a 100k being a CEO of a finance firm, obviously, but at a startup, yeah. none of us earned over a 100K, not one in the entire team. So in Asia, you know, back certainly in 2016, 17, 18 in Singapore, a developer's 3k, 4k, a month. So 40, 50k A year at the most. In India it's 20 k, you know, so it's not the same. And up until Covid, we were all in Singapore, unfortunately with Covid and a lot went remote. And we had teams in India and, and around. But still,

Pablo Srugo (00:22:48):

But you know, one, I'll say this like payroll aside, salaries aside so that it makes more sense, like a hundred can be a lot of people from a management perspective, right? From an overhead and alignment perspective, when you're still kind of, I mean you've obviously got customers, you've got traction, but there's still an element of we're figuring out what's really this, you know, truly scalable versus Oh, we're just off to the races.

Ned Phillips (00:23:11):

Well, okay, I'm gonna so yes, we kept hiring, you know, developers to build the custom code. We kept having new ideas. We were like, oh, we can build, we even built AI versions of wealth management back then. We built an ESG product. You know, when you have, one of the dangerous things about having capital is that it gives you fuel for your new ideas when you should just be doubling down on your same idea. But one thing I'll say, Pablo, while we may not have made it out alive, and in 2019, it's my proudest moment in Singapore, we won the best place to work in all of Singapore as awarded by Glassdoor and, and the government of Singapore. Our rating was the highest of any company in all of Singapore, of all of the Glassdoor companies in Singapore. So we built a great culture and a great team.

Ned Phillips (00:23:54):

And I remember it was interesting back then. Somebody came to me, he shall remain nameless, but he knows who he is and was like, we're like three, four years in, we just raised our $10 million round. He said, do you think we should stop all the custom and just double down on the product and half the team now, because we know what we build works, but if we keep doing this custom thing, we'll keep losing money. I remember sitting and thinking, Hmm, I wonder clearly I didn't wonder enough.

Pablo Srugo (00:24:23):

<Laugh>, it's hard, right? It's hard to cut, it's hard to set constraints. Like you mentioned, this point around capital. Like, and I find especially, you know, in the early days, constraints set you free, right? Like in a sense, having, if you have capital, you have to be very, very mindful to not spend it. It's really hard and it's very much the exception. And so in a sense, like having different constraints, fewer employees, et cetera, et cetera, not saying that would've solved the problems, but oftentimes it just makes, it forces you to hone in on only being able to do the most important things. And everything else, has to fall by the wayside. 'cause You can't do it sometimes that actually can end up in a better outcome. You know, it's a bit of a paradox, but, but it's something I've seen.

Ned Phillips (00:25:03):

Yeah, no, I absolutely, and you know, we really, because we kept winning these custom deals and our revenue was going up, you know, we were winning more deals and the product, and this was the challenge. We had a team on the product, but when, like a custom prod, so the custom was, we designed a built RoboAdvisor using our api. So we're using some of our product, we were customizing the integration in certain features, but when it was like crunch time to deliver, we would take people from our product team, because what happens is the client would give us their final payment when it went live, and if we hit the deadline, we got a better payment. So we would take people from our product team to the custom delivery, because once it went live, we would get ARR and we did the ARR

Pablo Srugo (00:25:47):

And to do like, mainly what? custom integrations, things like that? That's mainly the custom work. 

Ned Phillips (00:25:51):

Yeah, it's partly the custom integration and partly, you know, certain feature sets, you know, wealth management, you know, so we're building a wealth management tool. It's complex, you know, not just the integration and, you know, this is live transactional buying and selling ETF, money movements, you know, dividend movements, updated price feeds, you know, that backend world. I used to build stock exchanges and stock trading systems. That backend world is complex. And yeah, we, you know, you, and again, you can't mess it up. This is people's money. Like this is real people's money. So you can't build something that's half assed be like, oh, it's live. Let's, let's give it a well, like, no, this, there's no, you know, we've got billions of dollars on the platform, you know, a quarter of a million people, it's Franklin, it's eight, you know, you got your SOC 2, you do it all properly, you know, it, it all worked. 

Pablo Srugo (00:26:40):

and Ned what would you say was the difference between the banks, like the Malaysian one, Franklin Templeton, et cetera, where they really pushed it out and they got many users, consistent users that were happy with it, and the banks that either didn't push it out or, or maybe even better ones like the ones that went live but just didn't put enough effort behind it. Like what was the difference between those two customers?

Ned Phillips (00:27:02):

It, you know, there's nothing, there's no one, you know, geographical or size or anything. One of the key things is this is: the top management, the CEO really behind it. So for example, Franklin did a lot with us and you know, they invested in us from the CEO, the Malaysian bank. I remember the CEO was into it. I remember we deployed for Standard Chartered in Kenya and Uganda and the CEO standard chartered Kenya. And we deployed without even going there over 50,000 people in Kenya are saving for a better life on technology. We built, and I'll tell you what happened to it, they're still doing it today. So even the company didn't get out alive. The ending was interesting. The CEO got on the phone when we first signed the contract on standard Charlotte at Kenya, and he was almost teary Pablo. He was like, we have to do this for our customers.

Ned Phillips (00:27:49):

This is a must. We need to make sure that people can save for a better future. And we believe in everybody. Are we together? And that was the consistent thing. I mean, do not even get me started on POCs. If it was like a POC, oh, the POC will develop it into something great. No, what? No one gives a crap. Yeah. The defining thing to me was that the institution really wanted it. It wasn't a-  do you remember in 2016, 17, 18, all these, you know incubator accelerators that these big companies were doing, all these POCs, come on, man, they must all be dead. You know, surely, like how many came out of their life? And it's not the fault of anybody. 

Pablo Srugo (00:28:27):

It was always like the innovation team, you know? 

Ned Phillips (28:30) 

Yes!

Pablo Srugo (28:30)

 The innovation labs from the true, like if there's nobody from the business units or the executives who maybe just to follow up to that, like who were you selling into? Mainly like who is the lead on, on these projects on the customer side?

Ned Phillips (00:28:42):

So because I'm old and I have been selling for a long time, I have a simple philosophy. You always call the CEO day one, right? You never call lower, you call the CEO every single time. Even if you don't get through, you know, shoot for the stars, you'll land on the moon, right? So in general, we always go C level head of Rev, CEO, head of revenue, head of global head. So for us, we are building wealth management, head of wealth management, head of business, 

Pablo Srugo (00:29:08):

because the ROI, we only touch on-  the ROI for a bank is what? Is it extra AUM or is it like retention of their customers? Like what's the main thing you were selling?

Ned Phillips (00:29:19):

The main thing we were selling, and I love your question because you know, let's face it, when you have technology, a startup, you're either saving money or generating money. That's it. If you can't describe, then there's no point. We, our pitch was this, you know, for banks and asset managers, these mass retail customers really struggle to use you. The onboarding is hard, you have minimums. And what's gonna happen is the betterments and wealth funds are changing the world to make saving for your future accessible. Our pitch to you is those customers, while they're very low margin and not much revenue today, they probably won't come back to you if you lose them today. So our pitch to you is win these low AUM customers in scale using the technology we build. 'cause In the long term, they will be sticky with you if you can show them today. So we, that was our pitch. It is to not lose customers to the betterments in the wealth front, but to also play in the game of winning that new customer base. That right now, a lot of these guys were still using paperwork, even when I started in 2016. They're doing, you know, paper signups for stuff, you know, a lot of these markets maybe not as advanced as the us. So that was, that was our pitch. 

Pablo Srugo (00:30:31):

I'm gonna ask you for a small favor, a tiny little favor. In fact, it's not even now that I think about it, it's not even really a favor for me. I'm actually trying to help you do a favor for you. Just hit the follow button you won't miss out on the next episode, you'll see everything that we release. If you don't wanna listen to an episode, you just skip it, but at least you don't miss

Pablo Srugo (00:30:50):

It's funny you mentioned paperwork, you mentioned wealthsimple earlier in the early days, I remember they had to actually file paperwork for everybody that signed up to an app <laugh>, because it was mandated. So the world has certainly changed a lot. And the other thing I'll mention and, and you reaching out to the CEO, I love that because I think one element that is hard to remember, like as a startup, you're the opposite of an enterprise. Like it's you, it's three people, it's five people. Like you're, you're in one little unit, right? And, and you're trying to sell it to this behemoth. And it's hard to sometimes imagine what it must be like there, especially if you haven't worked at a large company. And one of the things, and I haven't, right, but speaking to many founders who have sold into that or worked in there, like, what you have to realize is most of these initiatives, strategic initiatives, like there's still only, there might be 10,000, a hundred thousand people who work there, but there's only like a dozen brains that can carry forward a strategic decision.

Pablo Srugo (00:31:44):

And there's only a set number of strategic initiatives that actually matter at any given time. There aren't 10,000, there's like five. And so if you, if you can't find a way to be that you will never get the timeshare, you might get somebody's budget, right? Because there's budget all over the place. You might get budget, you might get implementation, but you won't get pushed, you won't get that kind of, it's not just “absolutely” but just like the head share that you need to succeed in the B2B to C kind of motion, unless you are at the highest levels. You have champions at the C level and above, not above, but around there sort of thing. Otherwise, yeah, it's gonna be a challenge.

Ned Phillips (00:32:27):

Your point about having say, five champions, so critical, and look, at the end of this, hopefully I can tell you a little about what I'm doing now, but selling B2B today, sure I can go to the CEO of a big bank because I know them and maybe might be like, yeah, we'd love to use you, but un underneath there is a head of revenue, head of finance, head of compliance, head of security. And there's two ways you can sell them. You can just go and pitch them, but if they don't know you and your little startup, you better have built your brand. And we Bambu, we had built a brand, our brand we used to have. So we built WealthTech and we used to say WealthTech lives here. I had a podcast, a newsletter, and LinkedIn, my newsletter was WealthTech Socks. And I'm like, we're making it better.

Ned Phillips (00:33:10):

We had a podcast, newsletter. I was on LinkedIn Pablo, we won 28 startup awards. And people used to be like, you guys are amazing. What they didn't know, Pablo, I entered over 300. I just didn't put it on my website. The 272. I didn't win <laugh>, of course, but you know, it's partly a game. But what I was playing, I wanted to get in people's brains really clearly that if they were buying wealth tech, you know, Bambu was the place to be. And we had conversations and webinars and talks, and what I found was that it created champions. So to your point, if you just have one or two people in that organization, it's not gonna work. You need, - one of my friends was applying for a US visa at the end of the day. I was like, how did you get it?

Ned Phillips (00:33:52):

He's like, you know what the lawyer said to me? I said, what? He said, that person at immigration, it's not US Immigration, you're talking to, it's one visa person, a human, and you wanna appeal to them. You wanna make their job as easy as possible. Make that dude’s job easy. Think it on a human level. So I used to think about it with these large banks, what on a human level do most of these people want? And you know, the biggest thing is B2B, what they don't want is risk. You know, the phrase, no one gets fired for buying Microsoft, right? It's super hard to, so you've got to build champions by building brand, building relationships, using all the different avenues. And I think we, you know, we signed, you know, we had Saudi Arabia's biggest bank. We had Brazil's biggest bank. We in America at one point, Pablo, we had a sticker that said Bambu available everywhere apart from Antarctica.

Ned Phillips (00:34:41):

And we had clients in every continent apart from Antarctica. And you know, and you know, and maybe we, you know, we lost a bit of focus. We were winning, you know, we won Saudi's biggest bank, Brazil’s biggest bank. France, Germany, you know, across Asia, we were winning a lot. And you know, it was probably a little we got a little head of steam up there and we were like, oh my God, we're gonna dominate the world. Let's go. But we customized a little bit in each market. And when it worked and we were getting funded and money, it probably obscured our vision to the slightly not so stable foundations. 'cause You know, hello? We were not flying business. I was flying middle. You know what, so my, one of my favorite moments, I flew from Singapore to San Fran on United, nothing against American Airlines, but they're not as good as Asian or other airlines.

Ned Phillips (00:35:29):

I didn't even pay for the upgrade to the aisle seat. I sat in the middle seat for 23 hours, and then I stayed in Motel 6. And when I saw the investee, he's like, where are you staying? I'm like, on Motel six. He's like, are you actually staying in Motel 6? I'm like, yeah, dude. Like, I'm staying- I didn't actually quite realize when I booked it, I didn't know how shitty it was, but we were trying to keep all hotels to a hundred dollars. And if you were in the valley,

Pablo Srugo (00:35:57):

a hundred dollars, that's tough. That's called like the street <Laugh>.

Ned Phillips (00:35:59):

I tell you what, it's Motel 6, man. This is 2017, 18. 

Pablo Srugo (00:36:07):

And this is like an ad for Motel 6. It's real shitty, but it's real cheap.

Ned Phillips (00:36:11):

it's real shitty. But hey, to be fair to motel 6, it was vaguely clean. And you know, I'm still here. But yeah, you know, I think there's this sense that, you know, as you know, we weren't doing crazy things with the money, but it's that lack of focus. You know, we tried to win in every country, and that means we'd kind of end up with clients everywhere. But then we had slightly different teams for that slightly different customization we kept telling ourselves. And it was based on the APIs, you know, we were reusing our APIs, but it used to be 80% of our APIs, then 50%, then 30. We'd try to keep it up. And, our product, which was just a straight use of a white label, never quite was getting traction. But our API customized business was, you know, getting traction. You know, like a lot of startups, it's easy to look back and go, okay, we should have just focused at the time we were winning deals, you know, getting to billions of dollars at AUM, getting money not thrown at us. I mean, I was working hard to get it, but yeah, I don't, you know, looking back on it, we probably weren't building the stable of ships.

Pablo Srugo (00:37:18):

And so maybe let, let's, let's kind of fast forward to like the, you know, the beginning of the end sort of thing. Like what, when do you start seeing that things aren't as rosy as you might have thought? When do you start feeling that and, and why and how?

Ned Phillips (00:37:33):

You know, man, I can always tell you not to the day, but pretty close. I think as a founder, you're always wondering, right? You never quite know. And I could tell, look, you know, our ARR wasn't what it needed to be. Like I, you know, we weren't completely delusional. We knew our ARR and we could start to feel we really had to-

Pablo Srugo (00:37:53):

'cause of that 3.5 million, was that ARR or was that counting implementation? 

Ned Phillips (00:37:57):

One and a half was ARR, 2 was Rev. So really, you know, but you know, for Asian companies, there still weren't many Asian fintechs doing even seven figures of any revenue. But it was early ‘22, you know, I was gonna say America's coming outta Covid, but certainly Asia was still kinda locked in Covid. But I did a trip and we were trying to raise our next round. So we had raised like one, then five, then like 12, so almost up to 20. It's like, I only raised 25 million. And the times before when I'd raised it, it hadn't been that hard i hate to say it, but within two or three months, we got our money. And you know what Pablo, you convince yourself you're a genius. You're like, oh, it's nothing to do with the zero interest rates money everywhere. It must be me. 

Pablo Srugo (00:38:43):

And was it, was it US VCs or was it VCs in Singapore that you'd raised from?

Ned Phillips (00:38:47):

Both but mainly US.

Pablo Srugo (00:38:49):

Okay. which were some of the VCs?

Ned Phillips (00:38:52):

Well Franklin Templeton from, it was maybe Franklin Templeton in a private equity firm, then Wavemaker in Singapore. And then when we went to raise, I came trying to raise 25 and I play poker. And when I play poker, I believe you can look at the person at the table. I remember going into the rooms of these investors pitching my 25 million round, and you know, the market, this is like early ‘22 early. And you can see that the market, you know, froth was coming off.

Pablo Srugo (00:39:23):

Yeah, it was starting to shift pretty quickly.

Ned Phillips (00:39:26):

And I could feel it, man. I was like, oh. I came back after three weeks. I said to my kind of finance co-founder. I'm like, dude, I don't think we're getting this. And then, you know, we had 25 at this valuation, all of a sudden we're like, how about 20 of this? How about 15 of this? And, you know, you know, when you're backpedaling, nobody wants to backpedal.

Pablo Srugo (00:39:49):

Not the beginning of good. That's right.

Ned Phillips (00:39:51):

That's right. You know, you do your best to talk it up. And, I think it was there, and somebody told me afterwards, Pablo, I've really loved this phrase. Now we had maybe nine months of runway. And someone told me afterwards, I think this phrase for anyone who's listening, “when you have nine months runway as a founder, the days are long, the months are short.” And I don't think there's any single better way to describe the 18-20 hour days and lack of sleep. When I say 18-20 hour days, I'm not trying to be macho about it. The reality is, when you're having dinner, you're still thinking about it. Right? That's right. It's not outside your head. It's only when you're sleeping.

Pablo Srugo (00:40:27):

It’s all consuming. That's, that's the thing. Like people know 18 hours at the computer, but it's not that, it's just you're driving your thinking. You're here about to sleep, you're thinking, you're eating, you're thinking.

Ned Phillips (00:40:36):

And, then what starts to happen is that nine months become six. I'm like, man, we gotta cut. And you have to cut really quickly because every day you don't, it costs to cut, right? It costs. But for us to cut, what it meant was, 'cause a lot of our team was doing custom integration means we've gotta lose revenue. And, you know, we got a term sheet like, you know, old stories before we kind of raised, got term sheets, done, got a term sheet, had it, and it was pretty much at level. So it wasn't a down round, but it was at level. And we, it got away from us for all the reasons of human life. I'm a karmic person. It is what it is. 

Pablo Srugo (00:41:08):

what happened? Like they, like you tried to close it, it just kind of went away, or?

Ned Phillips (00:41:12):

We tried to close it and you know, they were like, oh, we, you know, a couple weeks of DD and the market was just souring. And they're like, oh, we think we might struggle at this. And, and you know, I did the wrong thing, Pablo. I said, oh, I can come down to any rate you want. They're like, all right, now we really don't want you <laugh>

Pablo Srugo (00:41:28):

We want you to be reasonable, but not that reasonable. Exactly.

Ned Phillips (00:41:32):

All right, dude, I think you just sealed your fate. Here we go.

Pablo Srugo (00:41:34):

And when was this, by the way? 'cause Timing does matter. Is this late ‘22 now? Or late?

Ned Phillips (00:41:37):

We're getting into late, mid to late 22. 

Pablo Srugo (00:41:40):

Yeah. The winds are really turning like post June. It was just crazy. I mean, people saw it. Q1, people still dancing. Q2 people were like I don't like this anymore. Then by Q3 was like, no, no, we're out. Like, it was pretty crazy.

Ned Phillips (00:41:52):

It was. And look, you know, I never blamed macro.I have this kinda really strong belief. If you're the captain of a ship and it sails home victorious, it was the crew. If you sink it to the sea, it's you the captain, but it's never the wind. It's never the wind. The wind is the wind, right? There's nothing you can do about the wind. You just, you just have to figure it out. But what happened was, you said, we actually died twice. So within that ‘22, we ran outta money really hard. We ran outta money. No, I love this phrase. We ran outta money really hard. You either run outta money or you don't. “So <laugh> one zero”

let me rephrase. We ran outta money. And we, you know, it was a really difficult time. You know, like, I think as a founder, you know, we all go into this with this, you know, dream and belief, and we don't imagine that kind of mental turmoil that you go through when you know you have a hundred staff and you just know that this is, well, I didn't have a hundred by then, we gotless.

Ned Phillips (00:42:45):

But you know,, I remember by this time I thought nine days runway was a luxury, you know? 

Pablo Srugo (00:42:52):

Oh my God. Because- so in that time, you have nine months, you try and raise, then it becomes six months. You're like, okay, let's cut. You start to cut. But you can't really cut without cutting revenue. So you just kind of, that runway is a runway. I mean, unless you raise, you kind of can't really stretch it. Yeah,

Ned Phillips (00:43:04):

Yeah. No, you, you're dancing into it, you're really dance. And, you know, we did have some ARR that wasn't dependent,, but we were down. Again, the days along the months are short. we probably, you know, if I look back on that nine month date, we should have just chopped so much of it. And we still had some, you know, we were doing three mill rev, of which some, we still had some negative margin, wasn't great, wasn't as nice. We probably should have, we could have cut to the 1 billion of really good ARR rev  got rid of everybody, taken the fact that the business had to reset, start, almost start again. You know, you know, a braver man than me needed to make that decision., I couldn't get myself to do that. And maybe I didn't see it.

Ned Phillips (00:43:43):

And we then had a full dilution, one of our investors, you know, put in enough bridge. We cut 70% of the staff, we cut all of our marketing, came out of our office, still kept quite a-  told a few-  some of the customers that it was not working, we had to let them know that we weren't gonna continue. But interestingly, we were still kind of darlings in the market, you know, not darlings is the wrong word, but, you know, the internal turmoil that,-  and look, the business, it's not that we did anything wrong or whatever, we were just struggling. You know, we were just trying to make money. And in an environment where, whereas before you didn't need to make money to raise money. Now, there was just no choice so you know , we got our investors, we had a big dilution. We basically were given a year to be profitable. The investors said, look, we'll, we'll dig you outta this hole. We'll give you enough to get through it. And, and, and Pablo, when I said I had nine days runway to salary, like, I mean it, I'm staring down the whole barrel of it , you know? 

Pablo Srugo (00:44:42):

And how many people were you now? 30?

Ned Phillips (44:44) 

70. 

Pablo Srugo (44:45) 

70, okay.

Ned Phillips (00:44:46):

 60. No, maybe 60. 60. And then after that we got to 30, we went down to 30.

Pablo Srugo (00:44:50):

What was that like, by the way? Like I always remember, I went through layoffs. It was less people, but a similar kind of percentage, right? It was like two thirds of the staff in, in a day. And it was just this feeling of like, two things. One, you work so hard to find, like every single one of those people was 10 interviews, was a hundred resumes. Just to put round numbers on it. You work so hard to get 'em, to keep them to you know, fully ramp them. You obviously build relationships on top of the productivity piece, and then you let go of them. And, and, and on top of that, there's this second piece, which is just like, you know, we at Gym Track, for example, we kept going for two years after that mass layoff. But I, when I look back at that story, GymTrack kind of died that day.

Pablo Srugo (00:45:32):

I mean, the wind was sucked out so hard out of that balloon. It was almost- I credit the ones that can come back because you as a founder, like the dream lives in you. And when you go through something like that, at least for me, I'll talk personally. Like when I went through something like that, the dream was dead in my brain. And so how could you, how could you make it into reality? We brought a new professional CEO, we tried to make it, he certainly tried to make it happen. I tried to help, but the dream really kind of died that day. I dunno if it was similar for you. But it's, you know, I don't wish it upon anyone, but I do think you kind of don't know what it's like unless you, unless you go through something like that.

Ned Phillips (00:46:07):

Yeah. Well look man, I'm sorry you had to go through that. It is a brutal experience. We had a lot of layoffs then. It was hard. And it was interesting you asked, what did it feel like when we finally shot? We did a lot of layoffs right at the end, you know, and I had to talk to 20, 30 people in one day, and I was sitting in the room one by one. You know, I'm a huge believer in you speak to everybody. There's none of this mass email. You speak to every single person one by one. And I was trying to keep it together. I'm quite an emotional dude. And there's one dude, a coder who had been throughout the whole thing, had always kind of never asked me what was going on. But you know, the staff are not stupid.

Ned Phillips (00:46:39):

They know we're struggling for payroll. They know things are hard. They can see it. And he'd always, during that time, had just taken me for a cup of tea every so often and said, never wanna talk about work, just have a cup, cup of tea. We talk about other things, but he knew it. Like he knew what he was doing. He was giving me 10 minutes away, and he walked in the room and I burst into tears. I just burst into tears because there was something so- we'd had this, you know, as mentioned in 2019, we won the best place to work on, you know, we had the top writing on Glassdoor. Honestly, I was gonna say Pablo, I don't love technology. I love people. Like I absolutely adore people and I get it, you know, this is a first world problem, right?

Ned Phillips (00:47:16):

There’s people with bigger problems. But you're right. Like it's, yeah. And I remember going home and again, it's not, it at the end of the day, it's not about me. Like it, it's about these people. And, you know, so I'm a, I think I'm an ultra runner. I run a hundred miles at a go. I'm Singapore's champion Ultrarunner. I, had never been so tired and I had never been so drained of my soul as that. And you know, I'm quite an advocate for mental health now because I don't think you can, I mean, know mine is, you know, fine. But I think there were times there where I, I remember one time, you know, not when we laid off people when we had almost no money left. And, and I was gonna have to- maybe I wanna jump ahead, but we had one year then to be profitable.

Ned Phillips (00:47:59):

So we had some layoffs. And you said, you know, Pablo, you said your brain died at that moment when your company got layoff. I remember mine did a bit. It definitely did. But I was like, okay, one year, dude, let's go. Right? and it's different, right? There's no doubt it's different to be able to do that. But as we came to the end of that year, we were close on the revenue. We were really close. But there was one moment when we kind of, the board of directors decided okay it’s time.  And it's that moment when you have to make a call- and first, you have to tell your staff. You have to tell your client, we had clients with billions of dollars on our platform. And I remember I had to call one of our first clients, Standard Chartered, and here was the craziest thing. The dude I called, he'd been away on holiday. I went, I was like, Hey, how are you doing? He's like, great, great. Lemme tell you about my holiday. I've done this. Had a great holiday. I did this. And I'm like, here we go. And you know, it's kind of these comedic startup moments, which is real life, but you can only laugh. He's like, anyway, how are you? I'm like, oh god.

Pablo Srugo (00:48:56):

Thanks for asking <laugh>. 

Ned Phillips (00:48:59):

Yeah, not so magical. So, you know, to ask your point, you know, like, I don't think anybody can write the startup journey. Yeah. There were many other ways, you know, there were many other bits about it. But this clear statement was that we didn't anticipate the change in funding, didn't we kept customizing. And then, yeah you know, you put your effort into try to save it. And I'll tell you what happened in the end, but we did save some. 

Pablo Srugo (00:49:23):

I'm curious about the end. Did you end up winding it down or did you find a way to exit some of the assets?

Ned Phillips (00:49:27):

Ah, interesting. So, you know, it was the end of ‘23, so one year. And we really tried to sell it. And I tell you what Pablo, like in that last few months, I mean, I am a sales guy. We were at one of those- , do you know the Singapore FinTech Festival?

Pablo Srugo (00:49:39):

I've heard of it. Yeah.

Ned Phillips (00:49:40):

It has like 60,000 people. Like it's a big event. We've always had a stall there, a stand there. Bambu was always there. We were quite well known. We had our jackets on. We were like this. And I'd booked this six months in advance. This is November. And basically the board of directors said, if we don't have a buyer band in November, this is mid-November, we're shutting. So I'm on my stand. Everyone's like, oh, how you doing? You're doing great. And anybody who could have bought us, I'm like, dude, have you got a second? And I would rip them to the side. I'm like, you wanna buy it? Let's go. This is time. This is time. This is a deal. And I nearly got a deal done Christmas day, yeah, yeah. Hey, look, you know, we, so here's what happened. We had to wind it down. We had to liquidate it. And we had nine buyers for our technology. We sold it nine times, or quite a few of our clients bought it. Some new parties brought it.

Pablo Srugo (00:50:26):

 oh, like receivership sort of thing. Is that it?

Ned Phillips (00:50:28):

The way it works in Singapore is the liquidator is appointed to sell the assets. And you know, I have never been through a liquidation before, thank God. And I hope not to again. But for example, let's say you liquidate a coffee shop and you turn up at the liquidation. Either you can buy the coffee machine or I can, 'cause we both can't take it home. It's a physical asset. But when you're selling code, what you can do is say to people, look, you're getting a non-exclusive copy of the code. Because we did have a product, we had these amazing APIs, of course. And, you know, quite a few of our clients brought our code and carried on our products and hired our people. And quite a few other wealth techs and banks were like, this is great. Coded a great deal. We'd like to buy that too. Of the billions of dollars of AUM all of it lives on all those customers live on our product.

Pablo Srugo (00:51:11):

That's pretty incredible. That's pretty incredible. Honestly,

Ned Phillips (00:51:14):

Our product lives on, you know, our and other companies have brought it, put their brand name on it. So Bambu Tech is alive. I'm not gonna say alive and well, 

Pablo Srugo (00:51:22):

No, but alive. Live and <laugh>,

Ned Phillips (00:51:25):

I'll take it, you know what Pablo, I'll take Alive and .

Pablo Srugo (00:51:28):

it’s more than I can say about gymtrack. So it's good. Man. <laugh>

Ned Phillips (00:51:31):

Did gym track- I didn't-  did gym track?

Pablo Srugo (00:51:33):

No, we ultimately, yeah, we had to fully wind down and we, yeah, we tried the same thing, right? You tried, then you come really close. We came really close and, and ultimately, you know, just nothing there.

Ned Phillips (00:51:45):

Yeah, man, it is, you know, and as I, as I think about it, you know, obviously, like we all, you know, I said to you, Pablo, I'm happy to talk about this. It doesn't mean I'm happy with the outcome. But the lessons for founders really that, you know, really comes back to if you're building B2B and B2C enterprise, you know, there's these really important decisions. You know, if you've go for enterprise customers, how much do you charge them? That statement of work you have to get right. You know what happens if you're starting to lose on gross margin? Ask them about the marketing budget for it beforehand. Be strong and say no to the middle road. Either charge so much, it doesn't matter if it goes live like millions or stay on product. Because right at the end, Pablo, we had this ready to go RoboAdvisor for like $500 a month for any advisor to launch. So any financial advisor in America could launch their own RoboAdvisor on a multi-tenant robo, like a betterment clone, a very simple betterment clone, fully integrated, fully live for $500 a month. I sold 10 in like a week. I'm like, oh dude, here we go. It works, dude, it works. It works. did this right at the end. And I got like $5,000 of Rev. It's not gonna save anybody, but hey, if somebody told you I have 5,000 rev ARR in a week, you'd be like, okay,

Pablo Srugo (00:52:57):

That's, I'm listening.I'm listening now, 

Ned Phillips (00:52:58):

man. But, you know, so I think there's this-  I don't have the answer. Should I have stayed just at my product from the beginning? Yeah, but maybe I wouldn't have got the logos and I wouldn't have got the $20 million and I wouldn't have built what I built. Should I charge more for customization? Yes, but then maybe I wouldn't have won the logos and I wouldn't have got the funding. You know and there's no excuses. You know, we took some roads that were not the right- and we definitely hired, I think one thing I would've said is really think deeply about that hiring, because, you know, getting rid of your office, and I tell you, Pablo, I remember one time, you know, we had run outta money super hard and there's some things you must pay.

Ned Phillips (00:53:38):

You must pay your stuff, right? You must, and you must pay your AWS bill, otherwise they'll shut you off. But I remember we hadn't paid our rent for a couple of months, and I remember I kinda woke up on a Monday morning and like, oh dude, what if he locks the door? I remember running down to the office, right? You see, let's get that, you know, sorted. And so there's these little decisions you make along the way to what to, to work out. But I think, yeah, the B2B, B2C is hard and you know, there's no single answer on it. But, you know, really take strong decisions. Don't hire quickly. Build product for margin. And I'd like to ask you a question, Pablo, you'd always get told, founders never quit. After eight years, I had to quit. What's your thought on this statement? That founders never quit? 

Pablo Srugo (00:54:19):

It is such a hard one to answer, obviously, you know, theoretically I quit as well. And there's this kind of fine line right beside between kind of resilience and, and insanity. And I think you hear the stories of the founders who have tried and tried again and tried again. And at some point it worked. What I've come to say, I have this story I've told many times about a founder who’s a good friend of mine. I call him the founder cockroach and <laugh>, I call him that because he's this guy who he just will never give up. And yet he's had three startups, right? Like the first one did fail, which you could think of as quitting the second one. He and his co-founder had challenges. And so he ended up leaving, which you could think of as quitting. The third one he had to go through, you know, like he was, he joined his co-founder.

Pablo Srugo (00:55:10):

The other one was technical, had to remove that technical founder to build, bring in a stronger technical person, had to go through two different versions of the products that completely fell flat. Finally, the third one took off and it went from zero. You talked about kind of fast growth, like from zero to 10 to 20 to 40 to a 100K in four months, and then from a million a year to 10 million a year, two years later, to a 100 million dollars exit company that was not bootstrapped, but had only raised a few million bucks. So he made this kind of 10 plus sort of thing. And, and I think about all that, and I think for me, what it comes down to is if you want to be a builder, that's truly who you want to be, right? And for me, for example, like I'm more on the VC side now because that's what I enjoy.

Pablo Srugo (00:55:49):

But if you want to be a builder, what you have to not quit is that, is being a builder. Because the reality is, this product might not be the thing no matter how hard you push it. Even this whole startup idea might not be the thing no matter how hard you push it. But if you keep building with the right kind of mindset, the right principles, then with some little bit of luck at some point, hopefully you'll hit something. Maybe it'll be a little -, maybe it won't be nearly as big, but it'll be something that works. At least I truly believe that.

Ned Phillips (00:56:19):

I appreciate you saying that, man, because - good job for your cockroach friend, even though that's probably not the right terminology, he's more of a friend than a cockroach.

Pablo Srugo (00:56:27):

He's accepted it though. He's accepted it. He's okay with it.

Ned Phillips (00:56:30):

<Laugh>

Pablo Srugo (00:56:30):

I actually ran it by him.

Ned Phillips (00:56:32):

I've read your LinkedIn post about him.  I followed. tell him I follow the cockroach. You know, look, I had been a corporate guy for 20 something years. This was, you know, I'm not a literary man, but if anybody's read Dickens. Bambu was the best of times, the worst of times. It was truly the greatest thing I ever did in my career. The lows of lows, when, you know, you understand that nothing's coming out. And after it failed, I did spend a couple of months in my bedroom crying. not literally, but, you know, figuratively,, you know and then this amazing thing happened. I needed, you know, there's no secret for guessing that if you do eight years at a startup, barely getting paid and don't get an exit, it's not the greatest financial reward in the world.

Ned Phillips (00:57:11):

That doesn't make sense, that doesn't need a scientist to work that out. And so, you know, I'd been c-level in corporate. I'm like, all right, man, I'm 57 still. I'll go back to corporate. you gotta - . But Tech in Asia, which is one of the main media magazines online in Asia, wrote a story about it. And they asked me, they said to me, do you wanna be- can we interview you? You wanna be public about it? I remember thinking, oh man, you know, do I really want to just tell everybody I suck? Like, is that, is that what I wanna do? And if I asked a dear friend of mine, he's a private equity investor, not an investor in me. He's just a friend. And he's the friend that tells you what you want to hear, not what you need to hear.

Ned Phillips (00:57:48):

And he said, Ned, you built in public, die in public, absolutely die in public. So, you know, because founders need it. And B, so I told 'em the whole story, mag, they published a really nice article that was like, these guys tried hard. They were ahead of their time. They got some stuff wrong. But what Ned was good at was sales. Like they got so many logos, you know, he published it. It got half a million views on LinkedIn. I got 1,200 dms. And he asked me in the article, what are you gonna do now? And I said, man, and I actually said, I don't know if I'm a builder. I don't know. I said, I love sales, I love startups. Maybe I'll help some startups sell out. You know, dude, that article came out seriously, like 15 startups. Ping me, dude, do you wanna be a startup advisor?

Ned Phillips (00:58:28):

can we hire you for sales? And out of that was born my new startup which is, I always call it a simple services business. 'cause Every VC told me services business suck. And they're simple. So I like, it's my little it's my little go back at the world.. Yeah, I am embracing it. it's called the sales movement. I help B2B startups scale sales using content. Content means how they sell, how do you use LinkedIn? How do they build their brand? I've worked with over 25 startups. It's a one person business. I mean, the revenues, I only got, you know, it's solid six figure revenue right out the gate. It's profitable, it's scaling. and my wife is like, hold on. You are not doing another startup, are you? I'm like, no. Well, yes, no, it's services, it's not a startup. And- 

Pablo Srugo (00:59:13):

but i’ll do the same revenue as my last startup, but with one person instead of a hundred. How about that? Not bad

Ned Phillips (00:59:20):

<Laugh> not yet, but, but year or near, I'm ahead. We're getting there. Getting there. I'm sure <laugh>. And, and you know, but what it is, is, you know, look, you know it's a cashflow business, but you know, Pablo, Damn I love it, man. Like, I love it. And maybe I didn't know I was a builder till I was 48 or an entrepreneur or whatever, but I'm selling sales now. I adore sales, I adore startups. And you know, maybe this is the journey that came from what didn't work. And honestly, man, when you put on LinkedIn, any, any founder wanna talk about not success, and I reached out to you, I follow a lot of your posts and I've looked at it and I've, you know, we all think, oh man, everyone else got it right? And I'm the only one that didn't, you realize suck and all that crap, right?

Ned Phillips (00:59:56):

And then you realize, you know, your cockroach friend and other people, it's like, you know, maybe this is just a thing you do and you don't know which one. You know, my private equity friend, he knows who he is, and he'll listen to this. He said to me, Ned, I think you'll be better off in 10 years than if Bambu had exited for a hundred million. You'll be a better person. You would've built a better thing. And of course, I wish for my investors, it worked out. I wish for my team, I wish for everything. But hey, wishing doesn't change the world. And you gotta crack on. And yeah, I think you are afraid. That's why I ask people.  I think I've come to realize that once a founder always a founder, it doesn't mean it might be at the first vote.

Speaker 4 (01:00:28):

Well, na, thanks so much for sharing the story with us. It's been great.

Ned Phillips (01:00:31):

I appreciate it, Pablo. Thank you for having me.

Speaker 4 (01:00:34):

So, picture this, it's months from now, years from now, and one of your founder friends, a really close founder, friends of yours, guess what? Their startup went bankrupt. And it turns out, if you had just shared the product market fit show with them, they would've learned everything they needed to, to find product market fit, and to create a huge success. But instead, their startup has completely failed. You have blood on your hands. Don't let that happen. You don't wanna live like that. It is terrible. So do what you need to do. Tell them about the show. Send it to them. Put it on WhatsApp, put it on Slack. Put it where you need to put it. Just make sure they know about it and they check it out.