#132 The Exit: Selling Shipt for $550 Million

Since the beginning we’ve only really told one story on The Pitch, what it’s like to start and raise money for a startup.

But what about the rest of the journey? What happens after you raise the money? We all know that the goal of a startup is to eventually exit. But when do you exit? For how much? And how do you know who to sell to? What if they completely ruin the thing you’ve spent years of your life building? We’ve all seen that story play out.

And what does it even mean to “exit?” It all sounds so final, like you just walk out the door, straight onto your new yacht. But for the people involved, 

We wanted to talk to startup founders who’ve actually done it. How does it feel to finally accomplish the dream? And is that dream all it’s cracked up to be? 

This is a special segment we’re calling The Exit. 

Today, how Bill Smith, a high school dropout from Birmingham, Alabama started, scaled and sold Shipt for $550 million dollars in three years.

I’m Josh Muccio. On The Pitch, real startup founders pitch real investors for real money.

And on The Exit, we tell the rest of the story. Here we go!

Bill: The company just exploded overnight. 

Josh: What did you think going into that suite? Did you feel like a big deal? 

Bill: No, no I didn’t. I felt like a little guy 

Bill: I didn't have a feel for the game, but I figured it out really fast. 

Josh: What did you think when he threw out the number? 

Bill: I ran the company out of money, almost completely out of money 

Bill: I know my CFO and everybody was thinking, this is nuts. 

Josh: Oh, shipt.

Bill: [laughs] 

Bill: this is a life changing amount of money. 

Bill: this makes sense to do this deal, because once I've done this deal, then on the next company or the next one, I can hold the cards as long as I want to

Josh: Do you have any regrets about Shipt? 

Our first exit interview with serial entrepreneur Bill Smith is coming up, after this.

[Break]

Welcome back to The Exit! Growing up in rural Alabama, Bill Smith’s career started young. At age 11, he worked at The Country Mall. It was the kind of place where customers kept a tab in a spiral bound notebook. But even at that age, Bill Smith knew he wouldn't always be working for someone else.

Bill: I always thought I would be an entrepreneur. my father was, and still is an entrepreneur, and I grew up seeing him build businesses. I used to love to go to work with him. uh When I was five years old, I asked my parents to give me a briefcase for my birthday. I pretty much always thought I'd be a business person. I never really liked school and I got bored very easily with school, so I started selling cell phones on the side when I was 16. 

Josh: Is this in the 2000s? Early 2000s? 

Bill: This was 2000. So I would get out of school and uh drive my minivan to the car dealerships in the area and sell phones to all of the new car salesmen and I was making $5,000 a month selling these phones And then I decided, hey, I'm going to go out and lease an office space. So I was at the Waffle house reading the classifieds, looking at office space. I saw an office space that was $300 a month. And it said it had new paint and new carpet. And went and signed a lease and secured an office space.

Josh: At 16?

Bill: Yes. Without telling my parents, by the way 

Josh: What! [laughs]

Bill: I stopped showing up at school, and it took about two weeks, surprisingly, for the school to reach out to my father and say, hey, Bill hasn't been to school. And I said, oh, gosh, this is going to happen now. This is going to hit the fan. And I was concerned about what the consequences were going to be of what I had done 

Josh: Was your dad mad? 

Bill: I know he was upset and he was going to take my car away. He was ready to try to use leverage to get me back to school and get me back on track. So he wanted me to go to the school with him to have a meeting at the counselor's office. I sat down with the counselor by myself at first and told her what I had been doing and that I was selling phones and doing all this stuff. And then my dad came in the room and we started to talk. He said, you've got to tell him that he has to come back to school. 

Josh: Mhm 

Bill: The counselor looked at my dad and said, look, we're not worried about Bill. He's going to be just fine. 

Josh: You’re kidding

Bill: And that was pretty much the end of the meeting. And we started to talk about how I was going to get a GED. And, and I left that day and never turned back.

Josh: Do you remember how your dad reacted in the moment when the counselor said, we're not worried about Bill. He's going to be fine?

Bill: I think he knew that he had lost because my mom was supportive. And then this counselor was saying, hey, we're good with this. 

Josh: huh

Bill: So I think he just said, all right, I've lost. I got to go here. 

Josh: That's crazy. I don't think I would let a kid do that. 

Bill: I probably wouldn't either. And I've talked through this with my wife, who has a master's degree, and really, she's actually an elementary educator, and we've talked about that a lot, and we definitely don't want our kids to follow that path. Somehow it worked out for me. I don't recommend it for others. I think I had a lot of things in my favor, potentially, but you know somehow it worked out. 

Josh: Yeah What ended up happening with that business?

Bill: Sold it. 

Josh: Are you able to say, for how much?

Bill: Not much, it wasn’t much, it wasn’t like some big win or anything 

But it was just enough money for Bill to go and start business number 2. With a small investment from his dad.

This company, Insight, was in the prepaid cards business. They built software that allowed people without a bank account to get prepaid visa cards.

Bill had to up his game for Insight. He had to hire a team, build payments software, and convince big banks to partner with him… all in his late teens and early 20’s. 

Insight got bigger - wayyyy bigger - than Bill’s little cell phone business. So big that others in the industry started to take notice.

Bill: So I was at a conference, a prepaid industry conference, and I'm hanging out at the booth. The CEO of a company called Green Dot walked up to the booth, and he, you know, Green Dot was the big dog in the industry. The CEO's name was Steve Street. And he introduced himself, and I told him about our business, and he said, oh, I'd love to talk to you more. Why don't we meet up in our hospitality suite this afternoon? When are you free? So we set a time, and I go into the hospitality suite.

Josh: What did you think going into that suite? Did you feel like a big deal?

Bill: No, no, I didn't. I felt like a little guy because I knew they were a big public company. 

Josh: hm 

Bill: I told him about our business and our size, and before I even walked out of the room, he said well, we're trying to grow in the space. We'd be interested in acquiring your business. And he just threw out a number to me and said, how does that sound? Is this something you might be interested in? And I said, well, let me think about that a little bit. I didn't want to respond immediately, 

Josh: mhm

Bill: So I just said, hey, I'll get back to you. And that was the start of our relationship.

Josh: What did you think when he threw out the number? Was this like a life changing dollar amount at this point?

Bill: Yeah, it was real dollars. I can tell you it was in the eight digit range, so it was big. So I thought, man, this could be cool. and we ended up selling to them.

Josh: Wow. 

Bill: But it didn't happen overnight. Whenever I've sold a business, they never happen fast. It is very easy to get distracted and excited and thinking about what you're going to do with your millions. But if you take your eye off the ball and the numbers turn or something changes, it's game over for that deal. 

Josh: You can run your business into the ground. When you're like, almost at the finish line, 

Bill: Yeah 

Josh: So you had your first exit at 18 years old, your second at 24, and then I think, was it six months later you start another company. This one's called Shipt. 

Bill: That's right. 

Josh: What was the initial idea for Shipt? 

Bill: I saw the creation of Uber and Lyft happening. And I remember taking my first Uber in DC when it was only a black car. And I remember reading about Uber in Fortune or Forbes and talking about how people were taking black cars to the grocery store and things like that. And so I saw this on demand economy being born. I recognized that I hated waiting for items I bought to be delivered, but I hated going to the store. So my thought was to create a platform for big box retailers to offer shipt at the checkout on their own website. 

Josh: And you invested your own money from selling your last business, and you built the first version of an app. 

Bill: I invested probably a million dollars total to get to this point. Built a software platform, hired engineers. I bought billboards. Five or six outdoor billboard ads.

Josh: Oh, wow.

Bill: All these things I had done to announce the launch of Shipt 

Josh: You were thinking big! 

Bill: Oh, I thought it was going to be huge. I mean, we even spent time, how are we going to scale this from a software perspective, how we scale, how many transactions can we handle, et cetera. 

Josh: How does the launch go? 

Bill: It was horrible. I knew immediately that it wasn't going to work because the way I launched it was you would go to Shipt.com and tell us to pick up an order that you placed at Target and we would go pick it up. So you'd have to order on Target's website, choose in store pickup, and then go to Shipt and tell us to go get it for you. And I couldn't give it away.

Josh: Wait what??

Bill: It's crazy to think of now, isn't it?

Josh: You'd have to go to, hold on, go to the Best Buy website, buy something then go to Shipt and say, hey, I bought something at Best Buy. Can you go get it for me? 

Bill: That's exactly the way it would work. 

[laughter] 

Bill Smith takes a bad idea, and turns it into a good one. After the break.

[BREAK]

Welcome back to The Exit. Bill Smith’s first version of Shipt was, well, a shiptwreck. But there was one good thing he got out of it: a bunch of email addresses.

Bill: So I emailed every customer from my personal email address at Shipt and just said, hey, if you have any ideas or feedback, we're a startup, please tell me. 

Josh: Yeah

Bill: I kept having these people respond back and say, hey, it's cool that I can get a delivery from Best Buy, but I really just want my groceries delivered. And then at the same time, my wife and I had our second child and I went to the grocery store for the first time with both kids on a Sunday and one was crying and it was a huge pain. And I was literally in the parking lot. I looked at my wife and said, people have been asking me to deliver groceries. Now I get it. I'm going to go figure out a way to do this.

Josh: Now I get it. I realize how bad it is to go grocery shopping with the kids.

Bill: Yes. It all kind of clicked in that moment in the Publix parking lot on a Sunday afternoon. 

Josh: Do you immediately go to grocery stores or what do you do next? 

Bill: The first thing I did was go back to the office on Monday morning and tell my team of ten that what we're doing is not working. And I think grocery delivery might work. So before we write a single line of code, I want to see if I can get 1000 people to sign up and pay for a one year membership in advance. And this may not work out. If you guys are cool with that, please stick with me. If not, you're welcome to go get another job. But this is what we're going to try and do and see if we can make this work. 

Josh: Wait, you actually said that, you're welcome to go get another job? 

Bill: Yeah.

Josh: Huh. Did anybody take you up on that? 

Bill: Not a single one.

Josh: Huh. All right, so you're going to try to get 1000 people to sign up before you build the grocery delivery app. How did you go about testing that? 

Bill: My CTO found a mobile developer to build a mockup of the Shipt delivery app. And we hired a videographer. We spent $1,000 to shoot a low quality video showing the delivery process. So we just put the video up and we put some ads on Facebook and said, grocery delivery is coming to Birmingham. Sign up now, save 50% on your membership. My goal is to sell 1000. I think within three weeks we had sold 750 or something like that. A week later we were at 1000 and that's when we stopped sales. We shut it off and said, okay, we're going to go build this and we're going to launch it in April.

Josh: When you saw all those people signing up, how did it feel? 

Bill: Oh, it was amazing. It was the best feeling. I took screenshots of the progress along the way and every time somebody signed up I would get a Slack alert. I knew that I hit onto something that people really wanted because of the frequency of people signing up and paying money for something that didn't exist yet.

Josh: Yeah. How long did it take to actually build it?

Bill: Three months. We had to build a shopper app, a member app and a back end platform. And it was very hard. We had to manually build a catalog of every item in a grocery store. We actually had to send people in with cameras to go take pictures of all the items. But we did everything we needed to in three months to launch the app and allow people to start placing orders. 

Josh: Hm. So I'm looking at the Facebook page for Shipt and you can tell how quickly this thing blew up. Like you start in Birmingham and suddenly shipt is everywhere. How many cities did you get to in year one? 

Bill: 15 cities. Shortly after we launched Birmingham, we said, all right, well, what are we launching next? I mean, it might have been six weeks later we were looking at launching the next city. We ran the same playbook in every market. We did a pre sale campaign for memberships half price if you signed up before launch and we launched Nashville, it was great. We launched Dallas and it was a dud. Then we launched Tampa. And I call it, and my team, we all call it Kablampa because 2000 people signed up. We launched Miami. We had the same thing happen, 2000 memberships before we launched. And that's when I knew I mean this is going to work. And the company just exploded overnight. I remember having to go in the office Saturday, Sunday to answer the phones and talk to customers and shoppers and solve problems. We were all hands on deck just to, just to handle the demand.

Josh: Why did you start with smaller cities instead of the classic New York or LA.

Bill: So at the time, there was a company called Instacart. They had raised something like $250,000,000 before shipt was even open. And they were very focused on the coast. They were New York, San Francisco, LA type markets, and they didn't do anything in the center of the country. So we just said, all right, well, we're just going to own the south and the center of the country, and we're going to focus on the rest of America. Because, you know, it turns out people in um Grand Rapids, Michigan, want groceries delivered just the same as someone in New York does. And even more than that, there's a lot more families in the middle of the country than there are. And there's people with a bunch of kids, I thought. So it just worked out that way.

Josh: When did you decide, you know, what, I need to start fundraising for Shipt? 

Bill: So I went and raised $5 million from friends and family. And then I said, okay, well, I need to raise venture capital. I mean, this $5 million isn't going to take us very far.

Josh: How long did it last? 

Bill: I mean, maybe ten months, nine months, something like that.

Josh: And were you just hiring like crazy? 

Bill: We were hiring, we were losing money on every delivery, the customer acquisition. We had to have cash. Actually, there was just a working capital component where you have to pay for groceries before the customer pays you. And there's all this float. There's a lot of payments problems, but luckily I had been in the payments business, so I was able to figure those things out. But it took a lot of cash. 

Josh: And then you realize, all right, we need more money. So you went out to Sandhill Road? 

Bill: So I flew to San Francisco for the first time. I asked for a few intros from friends. We got some desks at the WeWork at second and mission. I knew as soon as I started walking around San Francisco that this was going to be the place. Everybody's talking about tech. It was an entrepreneur's dream at the time to be there, I think. And then I started to try to raise capital.

Josh: Who do you pitch?

Bill: I remember pitching Excel and Bessemer and all of these big names. I didn't pitch Sequoia and Andreessen because they were invested in my biggest competitor. I remember going into Excel and they had logos on the wall for all these companies that they had backed. And you're just thinking, I mean, this is where so many great companies have been funded and created. It was a really cool thing, but I didn't have a feel for the game. You know, I'm not a West Coast type. I didn't know the feel for even how people dressed. And I'm southern, so I sound a little different. 

Josh: Mhm

Bill: So I just didn't get it. I mean, I remember showing up to my first pitch and I'm wearing a sport coat I used to keep notes on a legal pad all the time and I kept all these legal pads. I didn't have a feel for the game, but I figured it out really fast. I figured out this is a more relaxed culture. 

Josh: Right 

Bill: And I adjusted quickly. But I pitched a lot of people and really had a very kind of a difficult time. This was raising our series a. It was in the beginning of 2016, and there was a little bit of a downturn. And everybody just asked me about Instacart. That's all they wanted to talk about. 

Josh: What did your pitch sound like? If you could remember back to the presentation you gave to those VCs.

Bill: Yeah. Well, the pitch is we’re… we're offering two hour grocery delivery from your favorite grocery stores on a membership. So that was our differentiator. You couldn't pay per delivery. You had to buy a $99 annual membership up front for it. And our other differentiator was, we have these amazing shoppers. So at the time, the on demand industry was starting to get a bad rap. Like companies like Uber and others were kind of getting a bad rap because people would say they didn't treat the drivers well or they didn't have a high quality or et cetera. 

Josh: yeah

Bill: Our model was, it was moms shopping for moms. That was my line. We screened all of them, we interviewed all of them, and we wanted to make sure that the person shopping was like checking your avocados and delivering them into your home and giving you a great experience and they really delivered. I think still to this day, the best customer experience of any on demand company. 

Josh: So was your pitch to these VCs like, we are not Instacart. Like we are the opposite of Instacart. Yes, we're delivering groceries, but there's membership right from the start. We're not going to fall into the same issues with workers because we're treating people better. Was that really the pitch, or was it something bigger? 

Bill: That was the pitch. It was really simple. 

Josh: Did you eventually get someone to say yes?

Bill: We did. So my first partner was Greycroft, and they actually found us when we were raising the $5 million. 

Bill: And they ultimately didn't invest then because the terms. They said the terms weren't good. 

Josh: I'm sure they kicked themselves when you came to them for the series A.

Bill: Yeah, they still got a good deal though, 

Josh: Do you remember what the valuation was at the series a?

Bill: Yeah, I think it was 65. 

Josh: And how much did you raise?

Bill: 20 

Josh: Okay so $20 million so you go back, you start putting that money to work. Were there any points where it felt like you weren't going to be able to make this business work?

Bill: So many times I thought shipt was going to die multiple times. Um I ran the company out of money, almost completely out of money. 

Bill: You know this company is growing super fast. I mean, it probably grew 300% the second year and 300% the third year. The numbers were insane. So I remember we were working on closing the b, and we literally ran out of money to make payroll, and I had to fund it personally. I had to wire money in from my own bank account to cover payroll um to get us through.

Josh: That's not a great feeling, because if that b doesn't come through, you're not getting that money back. 

Bill: Exactly. It was crazy. I'm sure my management team was you know wigged out. I know my CFO and everybody was thinking, this is nuts. um But you know I jumped in and covered it. And we got to the b and closed it.

Josh: So then, in the summer of 2017, Amazon buys Whole Foods for $13.7 billion dollars. Where were you when you saw the news? 

Bill: So I am in Turks and Caicos with my family to celebrate my father's 60th birthday. And I remember at breakfast I start getting news alerts from the Wall Street Journal and whatever other news outlets that Amazon is acquiring Whole Foods. And I thought, oh, man, this is either going to be really good or really bad.

Josh: Oh, shipt.

Bill: [laughs] 

Bill: I had board members calling me asking me what I thought about it. And I would say, the first day I was concerned. 

Josh: Why were you concerned?

Bill: Amazon is incredible at execution. So I thought, they're buying Whole Foods. They're very clearly going to go tackle grocery delivery, and they're going to just come and take everybody out. But then after a few days of thinking about it, I realized that this was actually going to create a huge opportunity for us. My customer wasn't really the Whole Foods customer. I'm serving all types of families that you know buy all kinds of things and don't want to spend the kind of money that it takes to shop at Whole Foods, or whole wallet as we called it back then. You know, I thought it was going to actually be harder than they realized to reposition that company and really kind of build a mainstream brand. 

Josh: So you thought that this could actually help you. Was that right? 

Bill: It did help us. One thing it did is it clearly communicated to everybody in the grocery industry that they needed to have an ecommerce and a delivery play. So everybody wanted to start figuring it out. And at the same time, people realized they needed to own the capability to deliver. Multiple retailers called us within the couple of weeks from that transaction, and they wanted to meet. And you could tell they were looking to acquire somebody.

Josh: Are these retailers like Publix and other brands essentially, that just saw what happened with Whole Foods and thought, hey, we can do that, too? 

Bill: Yes. If you name the major retailer, we probably spoke to them during that time. 

Josh: Was there anyone who stood out? 

Bill: Certainly Target.

The Exit, coming up after this.

[break]

Welcome back. Bill Smith thought that Amazon buying Whole Foods could mean the end of his business. But a rising tide does float all Shipts. Almost immediately, grocery chains started reaching out.

Bill: If you name the major retailer, we probably spoke to them during that time. 

Josh: Was there anyone who stood out? 

Bill: Certainly target.

Josh: You're just saying that. 

Bill: No, I'm serious. So when I started the company, my vision was I wanted to deliver from Target. I mean, one of the billboards, I had actually had target on it showing kind of, we had a spaceship over Target was one of our ads. So it was always my dream to work with target. and they called and wanted to meet, and they didn't initially say they wanted to buy the company. They said, we want to talk about partnering. And so I flew up to Minneapolis and met with their team and talked through a partnership, and it just kind of developed over a matter of weeks from partnership to, hey, would you be interested in an acquisition? 

Josh: What was your immediate gut reaction when they proposed buying you? 

Bill: Yeah. So I think the first thing was, what's your plan with this? Some companies can do an acquisition and they'll absorb the company they're acquiring and integrate it in, and you kind of lose your identity. And a lot of times these acquisitions become failed acquisitions. 

Josh: Yep, been there

Bill: Yep. [laughs] Target said, hey, we actually want to acquire you, and we want you to keep serving your partners and grow your marketplace and add other retailers. And that was really important to me because all of these retailers that I had signed up to partner with were people I really loved and cared about. So I didn't want to sell to Target and say, hey, guys, we're not going to partner with you anymore. That would have been bad. So they said, we're going to grow your marketplace. And that was a really unique pitch that no one else had for us. And they said they're going to, wanted to retain the brand, they wanted to stay in Birmingham, they wanted to keep the team 

Josh: oh, wow.

Bill: It's really every entrepreneur's dream. 

Josh: When they originally made the offer to buy you, what did your investors, board members, what did they all think? 

Bill: So we had a lot of healthy conversation about this, and actually, one of my investors said, let me let you talk to some bankers about going public. And I started to go down that path and see what it would be like. And then other investors said, this is a life changing amount of money. This will make a generational impact on your family. You've already proven that you can start other businesses. You should strongly consider doing this deal.

Josh: What did Greycroft think? I mean, they had just led the series b, so presumably they had a price they wanted you to hit. Like were they okay with you selling at that point?

Bill: my partner there, really pushed me to consider not selling. 

Josh: mhm

Bill: He said, look, I'm going to do whatever you want to do. I mean, you're the CEO, and you know whatever you want to do, we're with you. And that was a tough decision to make. But ultimately, what I came back to was, if I had continued as an independent company and something else had changed or not worked out, how would I feel if I hadn't taken the $550,000,000? It was actually a little more than that. That was on the table in an all cash deal. 

Josh: Yeah

Bill: And I said, this makes sense to do this deal, because once I've done this deal, then on the next company or the next one, I can hold the cards as long as I want to, and I can do all types of other deals, buy companies, start them up, whatever. I'll have so many options available to me. 

Josh: Like a true game changer. Like life changing in that it changes how you play the game as you build new companies. 

Bill: It did. It really did. And It'll be a change for my lifetime. And my kids and other family members that were investors, and friends.

Josh: Yeah

Bill: So many of my employees and friends made millions in the process, people bought houses, and all kinds of cool stuff happened because of that deal. 

Josh: Is that the most satisfying part? 

Bill: 100%. 

Josh: Can you describe the day Shipt sold to Target. You were 32 years old, and the company sold for over $550,000,000. What was that day like?

Bill: Oh, it was a great day. So it was December 17. And I'll back up before the day it was announced, because the day it was supposed to be announced was actually December 18. And I got a call from the COO of Target, and he said, hey we actually want to announce this a day early. We're afraid it's going to leak. So we're sending our plane down to pick you up this afternoon, flying you to Minneapolis. We're announcing tomorrow morning. 

Bill: So I jumped on the Target plane and flew up there. And the next morning I'm on a call. We're doing interviews with the CEO of Target and myself. We're interviewing with CNBC and Bloomberg and the Wall Street Journal. All these things started at 06:00 a.m. In the target headquarters. I'm watching the sun come up. I'm in this amazing office, and just, I mean, this is a dream. This is everything an entrepreneur dreams about doing and I'm doing it. In the target headquarters. They have a bullseye, the dog. the mascot, built out of legos. And it's huge.

Josh: oh that’s awesome

Bill: It's the size of, it’s the size of me. 

Josh: With a target over its eye. 

Bill: Yep. You can picture it. So I just made a selfie video right there in front of Bullseye and told the team you know that we're being acquired by Target and we're going to expand our marketplace, and they're going to invest money and everybody's job secure, and they're going to grow in Birmingham and the whole thing. And I uploaded it to Slack. It was like an @channel, exciting news. Well, everybody in the office is trying to download this thing at the same time. Only a few of them could get it. And somebody actually videoed the reaction in the office.

Shipt video: Mine is still loading... there's 500..." "Did we buy target?" "oh my gosh!" 

Bill: And so all these people are gathered around, like, somebody's phone and somebody else's computer over here and another laptop there, and they're all watching the video, but everybody's being really quiet so they can hear what I'm saying. And people are laughing with excitement and high fiving and all that. 

Shipt video: "wooooo!! and clapping" 

Bill: And then I flew in that afternoon with the CEO and the COO of Target, and Bullseye came as well. The real live Bullseye came, and they were taking photos. Everybody got to take photos with Bullseye, and I had my kids there and my wife, and my father was there, and it was just a really cool cool cool day.

Josh: That's awesome. How long did you stay at Shipt afterwards? 

Bill: I stayed on for um about a year and a half afterwards. 

Josh: This is about the time that you retire, maybe start a VC fund, start sipping some mai tais, put your toes in the water, ass in the sand, no worries in the world, cold beer in your hand. Right, Bill? Right???? 

Bill: It’s hard to… it… it…a lot of people would do that. A lot of my friends that have sold their businesses do that, but not for me. I was only 32 at the time, so I had a lot of um living left to do. 

Josh: How did it feel to leave, to finally let go of this thing?

Bill: It was. It's. It's really not. I don't find it incredibly difficult because once, you know, once I've moved on, in my mind, it was time. My last day was on a Friday, and I had another office. And on Monday, I went back to the new office with my team of seven or eight people, and I had no idea what I was going to build. But I just told these folks, I want to start another company. I'd like you to be on my founding team. I think it was April 1, 2019, and everybody showed up in a room and it was like, all right, what are we going to do? And so I started working through my list of business ideas that I keep on my phone. 

Josh: Do you have the phone there with you?

Bill: I do. I have it, I have it here.

Josh: Would you mind taking it out and reading a couple of those ideas for us?

Bill: Sure. Let me start with the first two ideas. One was to create a commercial soap and paper dispenser that's connected to Wifi [laughs] you see places you go in a restaurant and the paper towels are out or the soap is out or whatever, and that's an annoying problem which would be very easily solved through just connectivity. You want to hear the next one?

Josh: Yeah.

Bill: Along those same lines. Had an idea for a company that just maintains restrooms for chain restaurants. If you go in these chains, the maintenance isn't right and things aren't. Just needs a whole makeover every six months. And I thought, man, somebody could create a company that does that. 

Josh: One of the ideas in this list is the idea for Landing your new company? 

Bill: It is. 

Josh: What was that idea? 

Bill: When I was building Shipt, I needed to have a home in San Francisco and experienced all the pain of trying to find an apartment on Craigslist and calling different realtors. And I had to get a cashier's check and fill out a paper application and meet Xfinity to, and you know get the furniture, all this stuff. And I thought, this is insane. And if you know anything about apartments, half of apartment renters move every year. And I thought, this is ridiculous. So I put that on my list. I thought I put on my list a solution for flexible apartment living. 

Josh: It's so interesting. I've met a lot of entrepreneurs who've done really, really well, where they're almost more afraid of failure after having success because they realize how lucky they got. So it's fascinating to see you just continue to start businesses… Like are you not afraid of failure?

Bill: Well, I don't want to fail. People talk about embracing failure. I don't embrace failure. I don't want to feel it. I mean nobody wants, I don't think anybody wants to fail. But I'm okay with it. And I've had failures. We kind of gloss over that when we're having these conversations. But there's things I've tried inside my company, many, many things inside my businesses that haven't worked But I think if you're going to play the game, and you want to win, you have to be okay with failure because it's a requirement. It's not possible to avoid it. 

Josh: Do you have any regrets about Shipt? Anything you would have done differently?

Bill: I would have gone faster, actually. I think, in hindsight, I think we could have done more. Even the company, I mean, it started and sold within three years. 

Josh: You think you could have gone faster? I mean, the company was growing 300%! That's absurdly fast. 

Bill: I think we could have done more. I really do. 

Josh: Can you imagine a point where there's Bill Smith not running a business?

Bill: I think about that. I've thought about that a lot. I don't believe that'll happen. That's not my desire. Now when I fast forward 20 years, 25 years down the road, I'm 38 today, and I think, would I be a CEO at 65? Do I want to be doing this every single day? I don't know, but I think I'll always own businesses. And that's something that I really am interested in. I bought a business recently. I don't run it, someone else runs it. And it's really more like an investment. But I can see making that transition at some point to owning companies, working closely with the president or the CEO, coaching them, and kind of providing that guidance, but not being in one single business every single day. 

Josh: It just strikes me as interesting. You've got a bank account like you've never seen before. You're three companies in. Do you know why? I still don't quite understand. Why keep going?

Bill: I mean. When it comes down to it, I think it's what God made me to do. This is what I was built for, is to solve problems in the world and build businesses and create opportunities for people. That’s my highest and best use 

Josh: Yeah

Bill: and that's what keeps bringing me back to it.

Josh: You feel like it's your purpose.

Bill: Yeah.

Josh: Thinking back on that moment when you were a teenager, and your dad decided to support you dropping out of school and building a business Do you think any of this would have happened without your dad letting you drop out of school?

Bill: No. I don't know what would have happened. I mean, maybe I would have figured something else out, but the timing of everything that I created, if you just rolled it forward two years, it wouldn't have worked. Insight wouldn't have worked. Shipt, would have missed, completely missed the window, even landing. We would have missed the window because there's just timing. Timing is such a key piece of everything. And if I had just rolled the clock forward two years and said, I'm going to finish high school, but not go to college, I would have missed out. If I would have gone into college, then I would have missed out. That would have been six years. So who knows. Now maybe I would have created something that's even greater than what I built. Who knows? But I'll take the cards I was dealt.

3 exits for the price of one. You’re welcome.

I’d love to hear your feedback on The Exit! I hope you enjoyed it. If you did, please share this episode. The more people listen, the more episodes we can make. Let us know how you liked it! You can tell us over on our free group chat on Patreon or comment on Instagram and Youtube.

Next week on the show, we’re back to pitches…and this one’s coming for my job.

Edward: What PodcastAI does is it lets podcast producers become ten times more productive 

Elizabeth: How much are you charging The Pitch?

Edward: We're charging $99. 

Edward: And Josh came in right before we doubled our prices. 

Beck: What's keeping something like a Restream from just going like, yep, we all do this AI now stuff too?

Edward: So there's a lot of these older companies that are tacking on AI. And that's kind of the issue: they're tacking it on. 

Mac: You built this really quickly. What's to stop anybody else from doing this? What's the moat?

How do you build a moat, when you’re building with AI? That’s next week on The Pitch. Like, comment, subscribe, and turn on notifications so you don’t miss it.

This episode was made by me, Josh Muccio, Lisa Muccio, Anna Ladd, Enoch Kim, and Jackie Papanier.

Music in this episode is by Memory Palace, Onders, The Muse Maker, Breakmaster Cylinder, Our many Stars, and Purple Moons

The Pitch is made in partnership with the Vox Media Podcast Network.