SaaS Interviews with CEOs, Startups, Founders
930 How a $10m Software Guy Ends up In Furniture Business and Tony Robbins
09 Feb 2018
Chapter 1: How did Mitch Russo grow Timeslips to $10 million?
This is the Top Entrepreneurs Podcast, where founders share how they started their companies and got filthy rich or crash and burn. Each episode features revenue numbers, customer counts, and other insider information that creates business news headlines. We went from a couple of hundred thousand dollars to 2.7 million. I had no money when I started the company.
It was $160 million, which is the size of many IPOs. We're a bit strapped. We have like 22,000 customers. With over 5 million downloads in a very short amount of time, major outlets like Inc. are calling us the fastest growing business show on iTunes. I'm your host, Nathan Latka, and here's today's episode. Hello, everyone.
My guest today is Mitch Russo, and he is the founder of a company called Timeslips, which he grew to 10 million and sold for eight figures. He was also CEO of Tony Robbins and Chet Holmes Business Breakthroughs International, then wrote his book, The Invisible Organization and How I Build Certification Programs. We're going to have a lot of fun. Mitch, are you ready to take us to the top?
Let's go, baby.
Okay, so what came first, Tony Robbins, Chet Holmes, or Timeslips? Timeslips came first. Okay, what year? 1985. That was launch or when you sold?
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Chapter 2: What challenges did Mitch face when launching Timeslips?
No, 1985 is when we incorporated the organization as a company.
And what did it do?
Timeslips was originally founded to create time tracking records for your personal computers so you could deduct them from your taxes. But that whole program fell apart after it was done because the IRS relaxed their rulings on contemporaneous record keeping and leaving us in a place where we had no, we had a brand new product. We'd both quit our jobs, but we had no one to sell it to.
How old were you at that point?
Oh, I was probably in my mid twenties, late twenties at that point.
Okay. So are you broke? Was everything riding on this company?
Everything was riding on this company. I was not broke. I had made a decent amount of money previous to that in real estate and as a sales executive. But I had quit my job and my partner had basically shut down his other businesses just to focus on this.
So what happened?
Well, we pivoted. I guess that's the word we'd use in these days. We scrambled to figure out what to do. And then we realized that lawyers and accountants need to keep track of their time. In fact, everybody in business does. So we decided to take time slips and transform it into time tracking and billing.
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Chapter 3: What pivot did Mitch make to ensure Timeslips' success?
I myself, I'm a great strategist and help companies reorganize their business and create new business models. And I had a sales guy who was a super team builder and things like that. So when we came in, we did everything, everything we could to help the entrepreneurs.
Many of you know I am buying companies that I really, really like, and there's no quicker way for me to get to the bottom of what is happening on that website than using this tool called nathanlaca.com forward slash hotjar, H-O-T-J-A-R. It basically will give me a recording.
OK, when anybody lands on the website, I'll give me a recording of where the viewer is scrolling and obviously does the basic stuff like heat maps, too. But I learned so much about where the users are scrolling and clicking on my site using that tool. It helps me increase conversion rates, make more money and grow those businesses faster. And we'll have to see what happens with those businesses.
But I'm buying them. I'm buying them very quick. And I'm using nathanlatka.com forward slash hotjar for all of my website analytics. You can too. I work with them. It's totally free. You can go to nathanlatka.com forward slash hotjar. No credit card required. Again, use it as much as you want. nathanlatka.com forward slash hotjar. I'll see you there. Did you make money doing angel investing?
No. And the reason we didn't is because it was 1999, 1998, 99 when I got back here. And that's when I started investing. And it was shortly thereafter that the dot-com bust hit.
You invested when valuations were way overpriced and then you got washed out when it hit. Exactly. Okay. It's 2000. What are you doing now?
So I actually jumped on board with a, um, with a client. So client turned out to be a zero stage capital in Cambridge, Massachusetts asked
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Chapter 4: What was the revenue growth trajectory of Timeslips?
hired me for a consulting assignment, figure out a new business model for one of their portfolio companies. I said, great. I came back and said, look, this isn't going to work the way you want it to work. This has got to be the way we do it. And I basically said, we're going to build a marketing company instead of a selling company.
They wanted to create a warehouse and pile furniture in it and sell it on the internet. I knew that wouldn't work in 1999, and I told them so. So we basically... created a marketing company based on creating custom websites for furniture stores and for manufacturers, and then selling a website subscription to a furniture store.
Using the technology we had developed, it was one click to create a website for any furniture store, plus their branding. So they came back and said, not only do we love that idea, we want you to be the CEO. Now, I had already been working with Assist Ventures. So I said, look, it would take crazy money to get me out of this position. I'm already working with all these other great people.
And they said, well, what does crazy money mean? And I said, well, it would take at least a half a million bucks. And they said, well, yeah. And they said, okay, we'll do it. And so for the most part, that's what I got. And I still ran assist ventures, but I saw the writing on the wall and I started to wind that down.
I saw that a lot of my investments were just not going to make it unfortunately, but I went forward with furniturefan.com and we started building that. And then it was growing very rapidly when the dot-com bust hit. And I'll remember this phone call. You'll appreciate this. So I call my managing partner at Zero Stage Capital, fantastic guy.
And I said to him, look, things don't look good right now. I still have about two and a half million of cash in the bank. Of how much that you raised? Four million. I said, you should take it back. I mean, honestly, it's and then he said, no, no, no, no, no. You're you're an incredible entrepreneur. You just go forward and you make this happen.
I said, OK, but if the market's not going to support it, it's just not going to make sense. But he said, just do it. So we did it. And unfortunately I was right and the market did not hold up. Uh, the furniture industry began to crumble at that point. We lost stores, we lost manufacturers. When the dust settled 18 months later, 30% of the industry had shut down.
Okay. So what year did you shut that business down?
We shut it down in 2002. Okay. Then what? Uh, then I get interested in investing in stocks and options. So I went back to school to learn how to become an options investor. So I became a professional options trader with a mentor on the Chicago Board of Trade for two years.
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Chapter 5: How did Mitch transition from Timeslips to working with Tony Robbins?
That's what I did not do in my 20s. If I were, if I know now what I knew then, First thing I would have done is I would have poured as much money as I could have into these life insurance policies called Income for Life just a little bit at a time. And by now, I would have had four or five million sitting around waiting for me to use any way I want.
There you guys have it from Mitch. Long-term investing, critical to, he wishes he knew that back when he was 20. He founded his company, Time Slips, back in 1985. Sold it in 1994 when they did 5.6 million in revenue. Got two times top line, so sold it for about 10 million bucks.
Moved to Dallas to get his earn out and built that part of the company up to $10.5 million in revenue under Sage in 1998 in a $100 million division. After that, went on to do many, many things. Some VC-related stuff. Got exposure to the furniture industry. That crashed and burned. Moved on to do a book. Got involved with Tony Robbins and Chet and many other very smart people.
Now launching his own software to help people stay more accountable. Mitch, thank you for taking us to the top.
My pleasure, Nathan.
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