speaker-0 (00:05.646)
Welcome to the Hard Tech Podcast.

And everybody, welcome back to the Heartseq podcast. I'm your host, Deandre Hericus, with the usual suspect, Grant Chapman. And everybody, today we have a super exciting guest, Bernie Youngblood from Hot Logic. Yes. Welcome to the podcast studio.

How's going, everybody?

speaker-2 (00:23.854)
honored to be here looking forward to this one.

For everyone at home, we've been chatting for the last two hours and have been done many rabbit holes. So this is going to be a subset of the many rabbit holes that Bernie and the team here talked about.

That's right.

And we're going to be friends for a long time, I can tell you that.

No, it's super fun to have you on so I think what we'd like to start because I already now know but love to introduce the audience to What are you currently doing and how did you get here? We have about 35 for

speaker-2 (00:48.046)
How much time you have? I'll try to keep it short. So, Youngblood, Director of Partnerships, Hot Logic. If we dial it back, because of course, why not start at the beginning? I got my degree in finance, but I came out of college at the height of that savings and loan crisis, which most people aren't old enough to remember, was a long time ago.

And so I started off really in the field of sales and marketing and never left. I'm on my eighth startup. I got into some entrepreneurial activities mostly because I get bored easily. Multiple companies, multiple industries, spin-offs, bootstrap, international distribution, all the above. Did I mention I get bored easily? So I like to, it's not so much going where the action is, it's going where...

in the fields that can hold my interest. At the end of the day, my defining value has always been add value or adios. If I can't add value to a situation, I'm gone. Why do I get out of bed in the morning? If I can't deliver value for me, for the organization, for the world, what am I doing? Which is, I understand, sounds strange to a lot of people, but that's...

Pray for my wife. But that's how I tick. So HotLogic for me is an amazing journey and a passion project at the same time. The only known alternative to the microwave and the facility break room. We've shipped over a million personal portables. Our largest clients, Walmart, when they build a new distribution center, they don't put microwaves in. They put the HotLogic product in.

go on social media, thousands, tens of thousands of user generated content videos, but no one's ever heard of the product. It's, I'm gonna say, one of the world's best kept secrets. I don't know what the rest are. But at same time, because it's centered around nutrition, because microwave bad, hot logic being the alternative, it's centered around nutrition. It's a passion project for me because...

speaker-2 (03:10.478)
You can go down the list. Diabetes, all time high. Childhood diabetes, all time high. Don't get me started on big food, big pharma, big healthcare. There's no end of challenges. So it's a passion project because this is a ship that we have to write. And what kind of world are we leaving to our children?

We have a lot of fun along the way, so that's my other role. If you're not having a good time, get out.

Yeah, let's let's pack this thing up and we're not all right. I'm doing it now the plane can be going down But we still have a good time trying to pull it up. This is

This plane is going down by the way.

This is the thing that I always tell everyone about. This is world actually, way more scary. But the story of like how do you survive being an entrepreneur? I mean, highs are high, but the lows, man, they're desperately low. And I'm like, that's because you learn to embrace the suck. You and your buddies and your startup or your small business or whatever you do, like you band together in the bad times and you just laugh all the way to the ground as you're bouncing off every boulder on the way down the mountains you slipped. You're like, ouch, that hurts. Oh man, how it works? Oh, it gets way worse next week. Buckle up, boys.

speaker-0 (04:24.938)
And if you have fun on the way down, man, the ride up is tremendously fun. Yes. And as long as you can survive that and like laugh through your own suffering and pain, then it's a good time.

But before we go any further, I've got to say, gentlemen, this is an impressive space. I looked at your website before Deandre was kind enough to invite me out. It's an impressive website. Yeah, I must have had a great website designer. Everyone's got a

We do that. Right, of course. Of course we do that in-house.

But I'm telling you what, you get here and like, your website doesn't do you justice. So if you're a hard tech podcast subscriber, right, and you haven't booked your tour of this space yet, I don't care if you're in London or you're in Dubai, get your ass to Indianapolis, Indiana, bring your clipboard. Can they bring cameras? Bring your camera. I don't know if you can afford these folks, right?

Thank you for cameras.

speaker-2 (05:22.606)
but you need them. I don't know if you know that you need them, but you need them. They're not paying me for this endorsement. I can promise you that, but rest assured you will not be disappointed.

I just had you just had to bribe me to come down to your podcast next. So you have listen to this twice if you all want to guys and hear two different different topics.

Grant featured on the Unboxing the Office podcast. Corporate Culture, Health and Wellness, they're all connected.

and I can't wait to talk about corporate culture. And I'll have to send you a podcast I was on two months ago that we talked a little bit about corporate culture and it'd be a good springboard for our conversation.

This is an important thing. It is. Back to the podcast.

speaker-1 (06:02.548)
I want to go two different directions. So the first one I to go is, Bernie, we were super excited for this conversation because it took Grant is probably one of the, if it's probably the smartest person that I know, especially in the world of hardware. And it took him to the end of our initial conversation to understand like how you guys are actually replacing the microwave. yes.

And like what the value prop of hot logic was like it took me forever to figure out like where all the math math Not just in the energy store like where the energy goes or the nutrition side like is like all right How does this all actually make it better or easier and there's like three things that finally dawned on me at the end like a light bulb clicked so I would like to hear you pitch hot logic and then let me go fill in the blanks of What the undertones are as a nerd you need to understand that connects all these dots?

going to make an incredible team. We have two basic product groups. have a personal portable oven that allows you to cook wherever you are. You can cook in your car, can cook at the ball game, tailgating, nurses, teachers at school, wherever you happen to be. That's the Hot Logic Mini. We're not going turn this into a commercial for the product. God help us. But just for information purposes.

This is actually very fascinating value proposition finding this is I'm gonna pitch this is not a commercial this is so fascinating to find how hot logic found value prop in a market that has existed forever That no one's invented on since microwave or lunchbox

Well, so, yeah, there's a lot to unpack. So the larger product, the commercial oven, the kind you find at Walmart or Merrill Lynch, we have a few at Apple and a few at Google as well, it's intended to replace the microwave. And we tell people it has a zero cook time, right? And that's obviously impossible. But it's a play on words, so to speak. So the basic principle is if you arrive at work in the morning, right, even if you work from home for that matter,

speaker-2 (07:51.534)
You're typically going have a lunch that you might squirrel away somewhere in the refrigerator. Or maybe you leave your lunch sitting in the vending freezer because you know that burrito's got your name on it. And then you wait until 12 noon or thereabouts to go back to that refrigerator, dig it out, go back to that vending freezer, pull out that frozen burrito, and then fight over the microwave with your 52 other coworkers.

That if it's frozen burrito all need eight whole minutes to defrost them and cook a burrito. 32 minutes, yeah. Right.

God help us if someone has a lasagna.

So, instead of, forget it, that was yesterday, instead of doing that, when you arrive at work in the morning, and here's the trick, when you arrive at work in the morning, because you know you're to eat lunch sometime during the day, instead of storing your lunch in the refrigerator, you place it on one of HotLogic's shelves, and you walk away. No buttons or dials, we call it the AI oven because we're cooking with software. Whenever you're ready to eat, whenever that is, it'll be held hot.

and ready, waiting for you, grab and go.

speaker-0 (08:54.22)
And now I get to dive in and unpack the value prop here. So this is what's fun for everyone that's trying to struggle like what does this even mean? What does it mean? So the first thing you have to get into is that we all think of food safety at home cold I keep my refrigerator cold to keep it back here from going to keep my food safe and fresh I keep my freezer frozen to keep my food fresh frozen safe no bacteria What you don't realize till you work in food service is that there's a flip side of that argument? Yes, you can things cold and keep it safe to eat

This is even me.

speaker-0 (09:22.51)
You can keep them hot. Yeah, so think of you all as listeners probably experience that if you never work in food service only at the buffet If you go to know all you can eat buffet guess what all those pans are a little steamer warmers where the water underneath is kept hot enough and It makes sure everything's safe because over I forget what they actually

speaker-0 (09:41.218)
Yep, so yeah 165 Fahrenheit will keep back here from growing and makes it you can keep it there as long as you want Doesn't matter can be there forever now your food will try out But yes, but it will for a whole day food safe day. You're totally fine I mean you can do the perpetual stew that if you keep a stew hot you can take from it and just keep adding to it forever and there are people that have kept perpetual stews running for years and You know restaurants and bars that are famous for keeping these old recipes alive So it's literally the stew that has never been emptied and cleaned. It is just perpetually added to and taken from

But that scares me. Yeah, now we're diverging. From food safety, you can keep it hot. So this is the magic that instead of getting to the office in your cold lunch box, because you've refrigerated the meal you're going to make for yourself and then you want it to get hot later, and putting it the refrigerator to keep it cold. Yes. You guys say, immediately put it into our personal oven. I'm going call it a personal shelf oven. It is how I pitch your big unit. They're a big industrial unit. It individual shelves, each heated at its own temperature. So it's not on unless there's food on it. Correct. And then you heat my lunch, if I store it there.

Yes, and again, it's not a high wattage oven. This isn't a thousand watt microwave oven Right and so what we need to unpack now is this is integrated over time. You're doing very low power over a long time Yes, so that eventually the food goes from cold safe refrigerator temperature or if you bring it hot It's already hot and maintains it hot but by lunchtime whether that lunchtime is at 1030 or 1 p.m. Or 2 p.m. Correct. It's food safe hot and ready to eat hot now. Yes, so you're not only saving the time of the microwave

70 watts per meal.

speaker-0 (11:07.282)
And the rush to the microwave that someone you know always puts fish in and ruins the lunch experience for everyone else or You're also saving the energy side so much We wouldn't figure this out until I unpack the energy storage here to keep things cold in a microwave We're always expending energy pumping heat out of the microwave into the room around us. Yes, right. It's a little low level They're quite efficient, but it's energy wasted. Yes, then you have to heat it up So we've kept it really cold and now we have to flip that going from what what's a really 45 Fahrenheit and then you

put it in the microwave to get it to 165 Fahrenheit. Or 400. Or 400. Yeah, you're really cooking. then water molecules take a ton of energy to change temperature. instead of having to keep it cold and spend energy keeping it cold and then spend a tremendous amount of power and energy right now to heat it up, you're like, let's use a little bit of power to maintain it hot. It's like a hot refrigerator.

Yes, and once it reaches serving temperature, roughly 12 watts to maintain.

Yeah, maintain and you always insulate your systems better in the future and the more installation you have less wattage But the more installation the more material costs and there's a trade-off here. Yes, so no I'm in love with and I hope the listeners don't follow that I hope I didn't butcher this Bernie, but no that was magic for me to understand You guys just literally flipped it because you can go food safety other direction and no one else has seen this this is like Revolutionary in personal food service

It's frustrating for us because we love the product. And at end of the day, for our big customers, it's all about productivity. You have an eight shelf oven. When eight people walk into the break room, eight people can sit down to eat immediately. Together. Zero cook time. Together and enjoy the community of their coworkers. Take that break that they enjoy. And the reason why Walmart has standardized on the product is Walmart, right? They have remarkable culture. Little known secret, right? Tremendous organization.

speaker-2 (12:56.304)
How do we know that? Because they invest in our products and our products aren't inexpensive, right? But they believe in investing in their culture, right? They believe in investing in their people. Why? Because when your people are able to enjoy the break that they deserve, rest, relax, restore, then get back to work, right? Productivity!

What is fine join your community. Yes, as you and I talked about at lunch, know an hour and a half ago Do what you love and you'll never actually work a day in your life. Yeah I work 80 hours a week to avoid working 40 for anybody else. Yes,

One of the questions I got for you, is you talk about Walmart and these very large clients. What was that process of going and getting those landmark clients? I feel like that's a really good point that maybe some anecdotes for founders that are looking like, how do you land a Walmart? How do you land a Merrill Lynch?

Our first products are actually installed at, I think one of the organizations is Herman Miller, of our top clients. They support a campus of roughly 3,000 workers across numerous buildings with our devices. It's one of the first installations, think it was 12 years ago. They've actually documented the productivity gains that their people realize. But I don't know if I'm allowed to talk about Walmart, but I'll...

I'll suggest that because of course there's some folks get sensitive about this information but I'll suggest that back in the day we were known to be disruptors so we didn't hesitate to go knock it on those doors. mean post-COVID you can't knock on doors like you're used to. The door is locked, the moat is full of alligators, the drawbridge has been raised.

speaker-1 (14:44.097)
Right.

You know, this is the world, right? But pre-COVID, we were known to go knocking on doors, and on a couple occasions, we were known to buy a chair and an umbrella and sit outside that door until you would talk to us. I can say that much, because I've been caught doing this myself once or twice. I even had people threaten to call the police on me.

The, as I mentioned, this is a passion project for us. We believe in the product and we want to share the product. We've given away as much product as we've sold, I'm sure. But we won't hesitate to, how do you say, speak truth to power, press the envelope. In the modern world, we're trying to find different ways to do that because, of course, everything's changed now. Nobody answers their phone anymore. Nobody pays attention to email. Everyone's on social media. We should start a podcast.

wait, we did!

And if I might add an anecdote to that, Death of a Salesman was written 75 years ago, and I've said this already publicly, I'll say it again, I'm calling it, sales is dead.

speaker-0 (15:55.63)
believe that too. I mean Deandre you and I both effectively do sales. Right? Sure. That's what we do for glassboard in our day job. Mm-hmm. But it's not your title and it's not how we tell people that what we do because got sales got actually euphemism. got euthanized? It got euthanized. It has a euphemism called business development. Yes. But that's that's now also giving you a new euphemism. It's called go to market.

to borrow from the movie The Graduate. I have one word for you.

Mmm. Yep. New game. Thank you for smoking has a really good argument for that that movie as well Really? that one's good. Power persuasion. It's good. you for smoking is worth watching Yeah, it doesn't matter what you're doing as long as you hold your argument in these steps was life-changing for me, but this

I haven't seen that one.

speaker-2 (16:42.838)
is something that, of course, the glass board organization is near and dear to your hearts. How do you introduce innovation to the world? How do you do that? It's a lot different than it used to be. It is. We live in an infinite noise attention economy. Yes, to break through, celebrities don't have all the influence that they used to have. They still have a lot.

The noise floor is very high.

speaker-2 (17:09.006)
cash flow, know, having the venture capital firehose of cash can help, not always. It is very difficult to press new ideas into our culture.

Sure, think that honestly when it comes to the evolution of sales as it were or even like marketing, it's just evolved. So what used to be celebrity endorsements is now in the world.

or even in this dev.

speaker-0 (17:35.884)
Yeah.

Or on the Wheaties box is now an influencer led marketing what used to be having a very popular radio show is now a podcast and that's the way that it manifests today people Don't even watch cable television my entire generation I go home after work and I'll watch YouTube and I'll just get to watch whatever channel that I want to watch for 35 to 45 minutes and just love every minute of it and I get that by the way, that's right and so I think that

generation.

speaker-1 (18:03.732)
sales and go to market has just simply evolved. so the tactics have as well.

That's a remarkably simplistic way to describe the collapse of an industry. Yes, it's evolved. Don Draper is on the corner selling pencils out of a cup.

Yeah, so let me let me dig into how you're feeling on it because what's interesting for us and especially our clients we found that the art we call it an art the art of I'm gonna boil it down to sales of getting someone to Understand that your product or service exists and to choose to buy it if it's in their budget and desire land, right? You know their zone of influence The way you reach those people is different. But what's more important is the message that you now have to send isn't totally

totally different than it used to be.

Well, in what I'll describe as a nearly transparent world, what I suggest to people, going back to Don Draper, the brands can no longer be built. They can only be revealed. So be careful what you say, be careful what you do. There are always eyes that are watching. And I don't care what good stuff your marketing department comes up with.

speaker-0 (19:15.331)
yeah.

speaker-2 (19:21.77)
are being stupid, particularly in public, we are witnessing companies being punished. Any number of examples, take your pick. For the bad acts and the good and the well-intentioned acts that don't go to plan or were not planned well, brands can no longer be built. can't... Forgive me for the...

that don't go to plan.

speaker-2 (19:50.806)
extemporaneous departure. it used to be, I'm an old man, back in our day, you hired an advertising agency, you make your product, after you're done making the product, then you go hire an ad firm. And here comes Don Draper, then his silky voice, his voice is almost as good as yours. Deandre, let me tell you, you missed your calling.

You hire an ad firm.

speaker-2 (20:16.6)
We're here. What does the future hold? But you hire the ad firm and the ad firm makes up some stuff and goes out and sells it.

they tell your story for you with words and pictures.

television, radio, print. Those are the only channels that existed. Television, gone. Radio, gone. Print, gone. DeAndre will say they evolved. But they're gone! And so it's much different world. And it's an amazing opportunity, of course. But it's a different world.

So what I think is fascinating about what I'm gonna call traditional advertising today is how it's changed Because actually went through two revolutions back to yes. there's the first revolution away from what you're talking about print TV radio Then it went to social media ads. Yes, so there's still advertisement You actually still went to an ad agency and they put together an ad and then you paid Facebook or meta or whoever To run it on their social media platform and they got in those social media platforms sold picks to gold miners and became trazillionaires. Yeah, but

Yes.

speaker-2 (21:19.224)
Yes.

The companies along the way actually could become overnight successes because they could target their exact market like TV could never do for them. That's right. I can only target people that like to watch the evening news or people that like to watch CSI Miami. Now I can target 40 to 47 year old women who also enjoy nail polish, poodles and blue cards. And with geographic specificity or any specificity that you'd like. And then that died.

and you can do it in real time.

speaker-0 (21:48.012)
And then Apple stopped providing tracking data for a ton of stuff and everything imploded. Yeah. So social because my wife has been chasing social media ads and she unfortunately her business started to need social media ads after the implosion. And we've poured probably 200 grand over the last four or five years to try and make ads revenue positive. And they're not. We've lost. We put a dollar in. We may get 50 cents back. It's been terrible the whole time. But what we found out is that it's just evolved and we to quit trying to pay for ads.

because now you actually do it through micro influencers. You find someone who has an audience that is 40 to 47 year old women that like poodles and blue cars and you have that person talk about your product for money.

I don't want to upset the apple cart here, but I was thinking about that on the way down here. I'm still working on this theory. Rest assured, if I haven't listed my disclaimer yet, I'll list it now. I know nothing unless every day, rest assured, I am making it up as I go along. Yes, right? I'm a Toys R kid. the DeAndre doesn't know that slogan.

We're all just playing a big game and figuring it out.

I still want to figure out what I do when I grow up.

speaker-2 (22:58.414)
I'm a Toys R'

I don't want to grow up. Yeah, that's burned in my brain. You have that commercial on TV.

I had toys arrest growing up, but I couldn't

That's brand. it revealed what, anyway. So this is still a working theory, but something to consider as you grow an organization, the adventure studio, so to speak, right? We have to put some thought around the necessity to build your audience before you build the product.

I want to chase this one down and around because I actually don't think you have to build an audience. You can buy them today.

speaker-2 (23:37.708)
Well, can you? Yes. Right? So you can buy an employee and you can buy their labor, but can you buy their heart?

speaker-2 (23:50.828)
Right. So hands are action versus relation.

I think my answer would be yes to both You can't hang it out. You could earn there

You can buy their heart.

We gotta talk!

I think to your point in terms of like building a brick and earn it. Yeah, that's right You can build your brand before you launch your product. You have this this we have a friend of the podcast best days company called flora and Effectively he made a product that goes into it basically helps you not kill your plants and he's got important It's very important right he killed his plan that his mom gave him all of a sudden he built this company. It's fantastic It's growing shout out to a bash and he has like 300,000 users on his mobile application. Yes, so he created

speaker-1 (24:31.468)
the audience and then sells a hardware product to that audience. Fantastic. So he focused on the software, but it took him longer to do the hardware.

The audience or the product?

speaker-0 (24:42.798)
He started building the product first so he set out to build a product so he wouldn't kill your house plan. And then he realized that software is easier to launch.

That's right. And so he launches the software, starts to the community, and then whenever he launches the hardware, he has that upsell to that community. So I agree with that. But I think that sometimes in order to build that, you can then sort of halo effect your way in to kind of get to somehow earn that audience. And somehow it is latching on to those micro influencers to kind of just at least create some level of awareness. And I think back to the point earlier around, I simplified and called it evolution.

Basically, I mean by evolution is that it's still fundamentally the same. Whenever you're selling anything, people have to have a business problem, and you just need to have the solution. They need identify you with that, whether they're your friend or they know you through advertising. But it's just the channels and motions have changed. And so just think that the way in which people find the companies that they need help from has just changed. And so I think that's the evolution that I was kind of speaking to.

Because again, I think you can I agree you can't buy your audience, but you can rent it Yes, and this is in yes This is where I'm you can rent your audience like we used to with social media ads and before that TV ads through influencers and you pay an influencer and so they make money to talk to their audience about your product and Eventually if you do successfully grow a brand this is going back to what you're talking about Then you have to continue to build your own audience. You can't afford influencers forever

Correct. I guess, well, I also have to bring up that we're talking about the difference between transactional relationships and relational relationships. If you just want to shove a bunch of prospects down a sales funnel and extract cash and then spit them out the back end and never see them again, well, sure, okay, anyone can do that. But if you want to build a brand that keeps REI, the organizations that have a loyal,

speaker-2 (26:40.144)
Trader Joe's a loyal following who will keep coming back again and again and again and again. That's an entirely different. Right. you know, I'm I'm split on. I never liked the Southwest Airlines seating model. I know there is incredible incredible.

formerly Southwest Airlines.

speaker-0 (26:57.538)
They had die hard fans.

I experienced it this morning and did not like it.

The new model or the old one?

this morning, whatever when that one.

Where you lined up outside by your number

speaker-1 (27:11.534)
You lined up by your number, okay great, but my huge anxiety as I walk to the back of the plane because they're all, everyone's obviously taking the spots and. Throwing the pillows. Yeah, you're nervous to sit in the middle when people are glaring at you. Not that part. The stressful part where you're like, I have no place to put my suitcase where I'm sitting now. I have to go put my suitcase far away from where I'm sitting. then there's like, whenever you get off the plane, it's absolute chaos. I have no idea why they don't just do a science seating. Is that some sort of innovation or was that?

elbow

speaker-0 (27:37.294)
They're to assign seating now. That was my joke of death of a brand because people died for Southwest because the way they ran their business was different. They were just contrarian.

Can I have permission to upset some people? Please. Okay. I'm here to tell you, and I'm willing to say it on the record, my favorite airline, Spirit Airlines. I have flown a million miles on Spirit, countless, countless miles. And people want, people are like, Spirit Airlines, isn't that the airline that has all the, the TikToks that come out of folks doing things that they probably shouldn't be doing, right? Maybe, maybe that's the one.

and nickel and diming you on all the fees, of course. The reason why I love Bernie Youngblood Love Spirit Airlines, there it is, is because it's cognitive dissonance. It's the fact that as a marketing person at heart, I appreciate it when a brand delivers to you the value that they promised. And you know what?

That's right.

When you buy a $14 ticket on Spirit Airlines, you're gonna get what you paid for. But when you buy an expensive ticket on XYZ airline, who shall remain nameless, and there's several of them, I paid $500 for this ticket. And guess what? The seat is just as crappy. The food is, actually the food is better on Spirit. The food is crappier. They hassle you about your, there's never, let me tell you something.

speaker-0 (28:46.508)
You're just happy to get

speaker-2 (29:12.942)
You take this one at the bank. I have flown I don't know how many flights on Spirit Airlines and I'm going off on this for a reason and I have never ever ever in my life seen the airplane run out of space for the overhead. Correct. They've never run out of space for the overhead. And I hate being badgered. It's demeaning.

Because they charge for it.

Truly capitalistic.

speaker-2 (29:36.216)
We're going to have to check your overhead bags. We're going to have to check your overhead bags. They make that announcement 22 times. It's demeaning. And I paid how much for that ticket? Anyway, the reason why this is important, the reason why I mention it is because I think with talking to the Hard Tech podcast, it's important to deliver on your brand promise. Any kind of disconnect is brand death. And that's a big challenge in the airline business.

I want to pause on that really quick. I asked you a question about 20 minutes ago on how you landed some of these massive organizations that any hard tech company would be really excited to land on.

Just said how you do.

I dodged it like Neo in the bullet sign.

But I think that you like I'm happy you told it the way that you did, okay? You absolutely and I think it landed your answer was Like under promise over deliver. Yes, like market like do what you say you can do and then over to I think an example of that is you see all the budget airlines right and The one thing that they promise you is everything that you're not getting correct. Do you see any other marketing?

speaker-2 (30:28.334)
was my answer.

speaker-1 (30:47.905)
You're never going hear how good Spirit Airlines is. They're just going tell you that you can't have, you got to pay for your bag, got to pay for your food. that's how people even are, talk about cognitive dissonance. If they gave you all the same things and just were cheaper than American, people would assume that there's something wrong with Spirit Airlines. So they almost like jumped the gun on that and just tell you this is what's wrong with it. And then you can opt into it. Yeah, very good.

And again, my co founder, I fight like cats and dogs about airline pricing. I really just want to be told what I can pay for. Tell me what it costs to get an overhead bag. Tell me what it costs to get a non cancelable ticket. Yes. And not just that I can't cancel it. That the airline will bump someone else before me. I'm willing to buy an insurance policy that I'm not the one that gets bumped off this flight.

Let me build my own smorgasbord of money. Or if I'm going on a cheap trip that I don't care about, I'll roll the dice.

So DeAndre, I apologize for what's it called? I did the weave to answer your question, to borrow from our dear president. Let me address that more directly. I've been doing this a long time. How do you land Wales, I think is the question. So I think in the modern world, is not, in 1997, I landed a deal with the Cadillac Motor Car Company.

how to go whale hunting.

speaker-2 (32:12.32)
the set us up with a multi-million dollar opportunity. did that. I did that because at the conference, I honest to God, true story, I picked out the prettiest girl in the room and sat next to her and she was the brand manager for Cadillac. And I literally told her, my boss will not allow me to go back to the office until unless I ask you for an appointment. And she says, of course, right. So the right moment, right, you know, right place, right time. That's right.

and stupid priorities. But I got lucky, right? And we've sat outside the front door and we sit there in the rain with an umbrella all day, two days in a row, and they take pity on us. And they let us in. You can't do that anymore. Can't do that. You might get arrested. Take that one off the table. What I'm going to, the answer I'm going to give you is something I've learned from a good friend of mine in the AI space.

AI is coming, it's coming on strong. But something to keep in mind is humans are naturally discriminatory. It's organic, it's what we do.

It's how we survived. Is this food safety or not discriminated?

flight, right, from our core. We're naturally discriminatory. And while AI right now is capturing our attention because it's novel, in due course, it's going to be very quickly identified as artificial. And we are going to discriminate against it. We're going to swipe left. And is left the bad one? I've been married 31 years. I don't know this stuff. But what my friend suggested to me is in this world, in the AI era,

speaker-0 (33:40.494)
think so.

speaker-2 (33:50.238)
authenticity will be the new currency. Whatever you do, if it is not authentic, you're going to be called out. And in our work, I've gotten phone calls from CEOs, emails from CEOs, in every case, when they're reaching out to us, it's in response to something we did, which might have been stupid, embarrassing, or smart, but it's authentic. And we see this even today.

That's probably my number one advice for building a brand and bringing in whales. Authenticity. Because the top brass values that now, and they will more than ever.

Mm-hmm. want to double click into that you just actually said how you did it at the very end of that one again We keep the last thing you say is always the actual truth The way you land Wales is not by courting a company. It's by courting a person This is this yes thing. Yes, you need to find your everyone talks about what is it? What is an ICP in your business? Who's your ICP? I deal customer persona profile whatever you want to call it It's not

Of course.

speaker-0 (34:58.188)
the kind of what's the word I'm looking for it's not the kind of client it's actually who you should be targeting is a human persona I want to target you know the Tamras of the world

Tamra in my model persona, she is someone in her career that is likely between the age of 28 and 52 who is in a leadership role and might have a title of X, Y, or Z. she is someone who's looking to be an innovator in her industry and looking for outside help to help innovate her corporate role. And she needs to bring in outside ideas to innovate on. That's an ICP. And you go find this Tamra, theoretical Tamra person. Tamra's our old director of operations. She's great so I can use her name here.

find where she's at and go reach out to her, not reach out to the whale. You're not reaching out to Cadillac or Elayl-Elayl-Elayl or any General Motors, any huge brand. You're actually reaching out to a human. And you're trying to get to talk to them. Then the rest is magic. That's true. That's what I call, what we call go to market. Go to market is finding a way to get Tamara to look at something that you did, whether it's an email or a phone call or a

gift fruit basket if that's how you reach out to people or you know, they hear you on a podcast. But this is how do get in front of that person? That's go to market. And then sales is build a relationship, find a problem you can solve for them, fix it for better value. They can do it anywhere else and make you the yourself the obvious choice.

So let me take it one step further. So I have this, I had a friend of mine the other day ask me, Bernie, what does the modern sales organization look like? I told him, death of a salesman, blah, blah, blah. And what I suggested to him, and this gentleman, we're the same age, he's in his 50s, we're old men, dinosaurs. 50s in the new 30, DeAndre. That's right. Back off. So what I suggested to him.

speaker-0 (36:29.822)
Double click, let's go all the way down.

speaker-2 (36:57.043)
I don't care if you're 50. I don't care if you're 30. If you think you're in the sales aka influence business

speaker-2 (37:05.548)
If your face does not, that's Hawaii, if your face does not appear on this device, because the CEO, as you suggest, the human being that you're selling to.

speaker-2 (37:21.066)
is the CEO of any company in the world is staring at this device.

This device for everyone listening is a phone. An iPhone. Yes! That's okay. I'm looking at the camera. what I'm here

Yes, thank you.

The so if you think you're in the sales aka influence business get your face on social media right now and and voice voice is important

with a voice.

speaker-0 (37:47.342)
They can be written or audio. don't care, but you video is best. answer is you have to have your authentic. Yeah, I'm going back what you're saying because anyone can pick out AI generated garbage on LinkedIn I see it through a whole field. It's just a bunch of people asking Jack to make me a smart sounding post and then they do it and I don't believe any of it don't care anymore. There's Yeah, there's yeah, there's the artificial kick it out because it means we're using as a tool to get a sale instead of

It is.

speaker-1 (38:07.598)
It's a judgment, by the way.

speaker-0 (38:15.878)
Advertising yeah, what they authentically offer in their role and what their company culture is and then if I can pick up on an average like hey our company solves XYZ problem And this is why I work here cuz I'm passionate about making sure food storage isn't just about food safety It's a community in the lunchroom. Yes, if I heard that story I'm like oh this isn't just someone trying to shill me a piece of appliance correct This is someone who truly believes that company culture is important, and they have a product that solves a friction point

speak to your brand message. And as Gary Vee would suggest, we have this tool available to us. And I say this because I have any number of friends who are my age or in this space and, Bernie, I don't have an Instagram. I don't have a LinkedIn. I have friends who believe, don't have LinkedIn. my God, they exist. And I tell them, who do think you are? What do you think you're doing? You're a dinosaur and I'm calling you out. Get your butt.

on those platforms. We won't always have access to this tool. You better build that audience for yourself before we lose access to it. Because eventually it'll cost, as Gary V suggests, then they start charging for it, right? And if you don't already have one, it costs twice as much to build.

I'll give you a really prime example. I firmly believe in like thought leadership marketing, putting your authentic self even on LinkedIn and not just being this canned whatever. Exactly. Or doing the podcast kind of thing. And honestly, like I recently it increases your touch points with if you're reaching out to someone, they can look at you and like you're at least worth a response if you're like a real person. But then at least they also feel like they know you.

this podcast.

speaker-0 (39:42.689)
Good stuff.

speaker-1 (39:57.424)
But even it's just that touch point. So for example, a gentleman on LinkedIn reached out to me and said, hey, can you introduce me to your engineering team? I said, you you to do the thing where you're like, yeah, maybe. But I keep seeing them post as like authentic photo on LinkedIn. And every time I see it, I think about that message he sent me. draw the point even further. I'm talking about it right now.

Like maybe I should give him a call.

speaker-0 (40:22.114)
that is what advertising marketing and influence is all about.

So that's something that we really drilled down into that one. it's fun. As a marketing guy, it's near and dear to my heart. Because it's evolved, as Deandre would say, to that point where we are. I don't know where it's going, but it's where we are.

Yeah, that's fun because I think that we've really Because gonna be this is the last board's journey of going from founder led sales to a team Yeah, and if for all of you founders out there that are about to go through us Please go talk to Ian Ellington at stompbox shout out here in Indianapolis He is a phenomenal consultant see that helps founders understand what it means to grow sales team that's not them because you know You and I do our jobs violently differently, but we do the same job Right our actions are motions as you like to like the mere word that I love to describes

Yes, we do.

speaker-0 (41:07.202)
What you're doing not how you're doing it our motions are totally different you and I do different which is the same outcome and We could probably have many people do the motions of the playbook you've written now for your role, right? Like you had me I needed you to write the playbook, but now we can have as class for gross we can have many of you That just can act those motions only the CEO because even if I leave the new CEO can do what I do Right, they can sell from the CEO seat. It's a completely different amount of influence or rapport. What do you want to call it?

And that was so wild for me to learn as a first-time founder. Yes. That, oh, I'm just going to hire a sales guy and I'm let him shadow me for six months and he'll be really good at this because he'll do exactly what I do. And boy, howdy, was that not how it works.

Grant, no one's ever gonna be do exactly what you do. Patrick plus one. I don't even understand it.

Let's just know it's your own know that It's just called driving driving by Braille and that's not the guardrails and this is the particular pattern that Left right left left right I bounce off of that works. We don't know how or why But you know, this is my favorite part like to bring up for the listeners Sales has changed as you said Bernie and you wrote a playbook for a service firm glassboard that sells engineering for hard tech Which is really hard and really rare and no one actually does it in real time. Yeah, but we found

a way to talk to humans and make friends that makes our authentic selves show thrill.

speaker-2 (42:28.726)
Yes.

speaker-2 (42:34.19)
Can we talk about innovation?

please.

Let's center in on innovation.

Because this is a challenging subject. Permission to upset people? We live in a world, we live in a culture that abhors innovation.

Yes, let's go.

speaker-1 (42:43.32)
granted.

speaker-0 (42:52.184)
Everyone resists change until they think it's cool.

Right. Yes. And even when change is, even when innovation is successful, too often in our model, it is attacked. Sometimes it is bought and it is shut down.

that happens all the time.

how many inventions have been shelved, right? How many large organizations, there are Fortune 500 companies that have venture capital departments that buy companies, competitors, right? Only for the purpose of shutting them down.

The worst place for this is medicine because treatment is profitable. Cure is not. That's a whole thing. But no, yes, going down the rabbit hole of.

speaker-2 (43:32.933)
The medical thing, we don't want to talk about that.

The innovation and at the same time, obviously given the state of the world, we could use a little innovation. I'm not talking about going to the moon. I'm just talking about basic stuff. It is remarkable that we allow this to happen.

Food and water.

speaker-2 (43:57.218)
Much of the pure research that was once done has been, of course, disbanded. Organizations don't do pure research, for the most part. And large organizations can't seem to figure out how to innovate, which, of course, to come full circle, makes an organization like Glassboard even more important.

to go all the way to the beginning, the reason large corporations struggle to innovate is culture. Aversion to risk. In a large corporation, you have built something big and you can't lose or you're either kicked out or you failed.

Yes! He nails it! my gosh, yes!

speaker-2 (44:40.504)
So how do we as a culture, obviously you guys are hitting home runs every day. This is your business, right? Okay, you you got some fall tips.

No, but that's my favorite part. Actual innovation is almost never hitting a home run. Of course. Actual innovation is swinging for the ball as hard as you can, shooting your basket as hard as you can, and missing 9 out of 10, 99 out of 100.

Hey, remember, I'm marketing, right? Never let the truth get in the way of a good story.

But then never giving up. Because eventually the blind scroll finds a nut and that's when innovation happens.

So you guys, this is in your blood, right? But you work with organizations every day. Your clients hire you because they want to inject innovation into their product, into their culture, what have you. How do you do it? How are you not affected?

speaker-0 (45:26.22)
whatever it is portfolio

speaker-2 (45:33.836)
by of course their TPS reports, their broken culture, their burdens, right? The red tape, here's the contracts this thick, right? That puts all of your people in chains. How are you able to do what you

do.

Oh, because I actually don't sell. I'm not a staffing firm. Sure. My clients do not manage my engineers. That is antithetical to how our model works. Our clients are on glass board, a product development firm, and they're hiring us on a retainer for a certain amount of money every month. That is actually not explicitly into ours in our contract. They're just giving me money. They're literally writing me a blank check for 15 grand a month, 30 grand a month, 80 grand a month. I don't care. That's our whole range, everybody. That's min-max. You've already found it.

But you can buy any number of dollars in between. We have an internal average hourly rate, depending on what department we're doing, that we'll bill against. We also, within that monthly budget, will buy prototypes. We don't have to go through their procurement. Glassboard is doing our work. Now we'll work within their larger team. If they want to do the mechanical engineering of their IoT toaster, we'll use Sunbeam. If Sunbeam wants to make an IoT toaster and innovate, they'd hire Glassboard, and our embedded software and our electronics team would work within their product development team, and they would tell us what they want the

IoTs out their toaster to do. We would go off and we'd work and we meet them every week and talk with their team and we'd share ideas of how we can integrate the IoT, where would it go in their mechanical design, what would the UX look like on the outside because they have a UX team, they their buttons on toasters. And we'd lead their horses to water where we need to interact with their stuff. But we would be fully free to innovate how we deliver the user needs. We always start every conversation. What user needs does the product need for you to be happy with it?

speaker-0 (47:13.004)
And we write those down from, have to have this, I'd like to have this, be cool to add this. And then within our budget, we go up and build a timeline and a budget. They buy into that. And as we get closer to the delivery dates of any milestones, again, we're paid monthly. We're not paid on delivery. We're paid monthly for effort. If we're getting close and not going to make it, we'll cut all the nice tabs. Classwork's in control of that. But I'll say, hey, I'm about to cut these.

You can either extend the time when I had more budget and we can continue to crank, but this is your in the driver's seat. Sure. But you're not going to manage my people. And that allows us to experiment and to try things and to put the right amount of effort in. And if someone doesn't like the way we do it, they can to break up with glassboard and not with a person.

How often do you reject new prospects when they come to the table? And how do you make that determination?

When so Early in class for days we told nobody no because we were hungry Fun fact about small companies we're big enough now we get to say no It's really empowering and we only get to we only we only work on what we want to work on And we actually find most things fascinating people might say I'm gonna build a trash compactor under your kitchen sink That's a fun physics, but we'll find a way to make that fun. It's not like it has to be You find a lot of things fun, but we don't work with jerks

Remember they're engineers.

speaker-0 (48:29.794)
That's that's the really the only filter like we we don't currently do any Okay, there's the world of defense and then this world of war sure there are differences sure We actually still don't have any

Man down. The audio is still rolling. We'll just roll with the audio. So we actually don't have any defense clients currently, and I think we never actually have. But we wouldn't take on any war clients. Like, I might build a bulletproof vest. I would not likely build a missile guidance system at Glassport. It's not our culture or what we do.

Do we really need another missile guidance system?

You got it the missiles gotta get to its target And someone's got to do it for defense like I'm got to keep the world in check as you and I talked about earlier the bullies Need to be taken care of this is true for you know fight the good fight against the evil of the world like someone's got to do it

So you do tell clients, sometimes you have to tell a prospect, not a client, a prospect no. How often, I don't know if you have numbers on this, how often do you get halfway through a project and then- Fire a And only then realize this for one of many reasons, this isn't gonna happen.

speaker-0 (49:25.558)
all the time.

speaker-0 (49:37.396)
sorry. This isn't going to happen because I'm going to be done working with the client or because the product's not going to work. Those are two different questions, and we do experience both.

In this case, I'm going to say cultural mismatch. Expectations, out of whack, client just doesn't understand the scope of work and time, dollar constraint, just bad fit.

No, so client where I will never be able to meet their expectations. They'll never be happy. Correct. We might get it done, but they will never be happy about it. many? One out of 15, one out of 10. Wow. Actually 10 or like 10-ish percent, maybe a little less. And most of the time...

How does that happen?

speaker-0 (50:22.262)
This comes to a head close note of the finish line that will just finish it sure we'll get to the end of a stage and then gracefully hand off the manufacturing support to another partner sure about a third or half those I do have to fire in the middle and say hey We're done now. We won't put the pencils down until you have a new firm I will help you interview all the new firms like I am not gonna drop you like a rock sure I have a reputation to keep and I'm also just not personally a monster I would hate someone do that to me

This isn't working, we're gonna find a way to transition this.

That's a much higher retention rate than I expected.

and what's so fascinating about our model of work for the last 10 years, 85 % of this year's revenue came from clients we had last year. That's every year. Every year.

And that's part of that deal.

speaker-1 (51:09.678)
There's really two kinds of firms when it comes to consulting. You have your black box firms. These are firms that once a client comes in, they just never leave. And typically, you find with those kind of firms, and I think Glassport was like this a few years ago, but not as much. They usually don't have as much of a sales function. So if they lose a few clients really quickly, then all of sudden they have to go flail around.

yeah, you mean the Fuse Famine Cycle. My favorite game.

That's right, the fees payment cycle. Then you have other firms that probably turn through 50 % of their book a year that they go refill it up. They have a really good sales process, but they're not as good at keeping clients. Honestly, that was one thing that I was pretty intentional when I was looking at Glassport, even from the go-to-market perspective, is you want to join a firm that's like ...

going to join either one of those firms, like the Black Box firm or the one that's really good at sales, insurance, and customers, of course you're going to want to join the one that's very good at keeping their customers. Because then, if you can actually stand up that good go-to-market infrastructure, then you've really built something that could scale and eventually get acquired as well, from a consulting perspective.

The final question I always love to ask people is, in your experience from HotLogic, innovation and marketing, what would you say is advice that you would have to people either founding a hard tech startup or folks that are in higher level leadership roles in hardware focused companies and their perspective on maybe innovation and marketing?

speaker-2 (52:35.896)
Well, that's an open-ended question. The goal. Can I phone a friend? I'm just kidding. So I think I've got three answers for that. I'm going to give you just one for sake of time. I think what's important, people talk about this concept of grit with entrepreneurs all the time. And I've done it many times. It takes grit to be an entrepreneur, bootstrap founder.

That'd be hilarious.

speaker-0 (53:05.974)
or VC backed, you still gotta have grit and grind through that whole process.

So then that's true, of course, but I'm going to add another category, if you will, or a related force that's important to keep in mind when you're in this space. And that I'll describe as brute force. you're going back to introducing, because hard tech, the work you guys do quite often is brand new.

You know, like Hot Logic is not only a new product, it's a new product category that's never existed before in the history of the world, right? And these things come along from time to time. And to do this takes brute force. You can go down, know, Magic Cap, of course, try to invent the next, try to invent the smartphone, if you will, right? Was it Magic

you know my magic leap magically the the bunny or general Yes, the documented general magic. talked about the podcast many times it is have you watched it yet? do have to make you do

General magic

speaker-2 (54:11.318)
They pulled the plug too soon. A couple engineers walked out the door and founded the Android operating system. Right. And then go back to Xerox, Palo Alto, the park laboratory. What people lose sight of. And venture capital, God bless them, they're doing the best they can. have constraints. People pull the plug often.

Well, first, Blackberry.

speaker-2 (54:36.962)
often. And true innovation takes time. But in addition to that, true innovation in the modern world also takes brute force. And I'm not talking about physical force beating somebody up, right? Because that was done in the 18th century, But in this case, what I'm talking about is within the market. And sometimes it's not pay-per-click or social media influencers.

As the expression I use is, you don't like your position on the board, change the game. If it's a brand new product or a brand new product category, the operative phrase I want to seed into your mind is, it might take brute force to get this product to market. What does that mean to you? That's the thought I want

I love that and for those listening at home, please check out the episode We did with the founder of zip wheels because the way they did sales marketing was brute force They just showed up a triathlon events the tent everyone and sold carbon wheels that cost more than most people's cars To triathletes at their events and just show up in the rain. Yes. I'm back to what you said to show up at door in the front rain that's

The difference between brute force and grit. Grit is sticking with it when the sails are down and times are tough and you just got to stick through it. force is doing something truly uncomfortable until it works. Yes.

I think Grant gave my usual end of the podcast summary doing something hard. But I would say show up in the rain. Push it down people's throats if they need to. Well your product in the way. Of course of course. But push your product that's sometimes go to market. Everybody this is the Hard Tech podcast. I'm your host DeAndre Hericus with the CEO of Glassboard Grant Chappell. Bernie thank you so much for coming in.

speaker-2 (56:06.638)
historically speaking.

speaker-0 (56:18.03)
How's it going? Thanks everybody.

I can't wait to do it again

Absolutely. Check us out on on what's the title your podcast? Yep, check it out coming coming to your ears someday soon. Yep. Awesome. Awesome. Thanks, guys. Take care.

Unboxing the office.

Someday soon.