There are a lot of journeymen (and women) in the startup and tech game. Matthew Bellows would probably qualify as one of them. In his 18-year career he's founded a company and flipped it for a few million dollars, jumped on board a growing tech startup but left before it was acquired, braved inter-office power struggles (and got canned in the process), raised millions in growth capital and, most recently, launched a sales and marketing communication tool called Yesware, all the while managing to fit in countless hours meditating.
“Business is very creative and you’re literally creating something out of nothing. I really love that feeling” said the 46-year-old. “That’s the feeling, I think, that drives me now.” Bellows, the son of a doctor and a psychologist, didn’t have much exposure to the finer details of business while he was growing up, but found its merits in the tech realm after much soul searching.
He spent two years at Brown University before finishing up college at Boulder, Colorado’s Naropa University—a liberal arts school founded by a meditation master and inspired by Buddhist teachings. “(it was) founded with the idea of contemplative education,” says Bellows. Two post-grad years were spent skiing, meditating and finding himself; working in restaurants to make money. “There’s nothing like a year of sitting meditation to help you get to know yourself. I just remember feeling like this is all so great but I’m not going to be a monk. I’m probably not even going to be an academic. I want to get back in the world.”
Getting back into the world meant returning to Boston and getting a job, preferably in software—a realm in which he had absolutely no sellable skills whatsoever. “This was 1995,” he says. “Computers have been and always will be huge in Boston, so lots of technology companies. I was living in Somerville and I basically circled all the ones that were within a bike ride of my house and just started cold-calling them.” A trick he soon learned was to always ask company operators to connect him with the investor relations departments. “They always call you back.”
By 2001, Bellows had several tech gigs under his belt, had studied Tibetan and Sanskrit at Harvard and earned an MBA from Babson College. He found himself working in business development at Engage Inc. as tech firms everywhere were taking a hit. He says it was then that it began to dawn on him that starting a company was not completely out of his reach. Engage was in the process of laying off employees and Bellows too was eventually given his walking papers. He used the free time to start game review platform WGR Media with co-founder Cashman Adrus that same year. They took on no investors, generating revenue from advertisers and providing content for other media.
Less than three years later, media content partner Ziff Davis was in talks to acquire WGR Media. “We engaged in a series of really painful, long meetings,” remembers Bellows. “They were talking about a five-year earnout, they were talking about all these terms that were just bad and not interesting.” An advisor suggesting gauging interest from tech media hub CNET, which led to a meeting with Gamespot co-founder Vince Broady. In a scene fresh out of every young tech entrepreneur’s more modest dreams, Andrus and Bellows flew to San Francisco where Broady ceremoniously passed them a piece of paper across a boardroom table. It was an offer for over $3 million cash—above and beyond their expectations. “We basically spent the next hour-and-a-half jumping up and down, screaming.”
Bellows stuck with CNET for a year before joining Floodgate Entertainment, a video game company founded by industry vet Paul Neurath responsible for such titles as Neverwinter Nights and Dark Messiah. The chemistry was wrong right off the bat. The added weirdness of joining an existing company after running his own made the experience even more uncomfortable and he felt he was not taken seriously by Floodgate’s founder. That said, he stayed with the company until 2008, helping raise capital and working to elevate the company’s revenue. “We never got the company going from a lifestyle business to a high-grossing company,” says Bellows.
Three years may have been enough for Bellows, but had he stayed another three he would have experienced another golden payoff—Floodgate was acquired by Zynga in the spring of 2011.
In 2008 he took VP of sales position at Vivox, a venture-backed integrated voice-tech firm and stayed for over two years. “The CEO (Rob Seaver) and I didn’t have a great working relationship,” says Bellows. “…We never really jelled professionally.” At a certain point, Bellows even suggested to the company board – and Seaver – that he himself might make a good CEO (realizing that should Seaver be replaced by outside talent, he too could be replaced). The move didn’t endear him to his boss, who let him go. “(Seaver) had an incredible attachment to the company,” Bellows said. “He was not going to let go and he’s a fighter.”
Tired of working with those he couldn’t mesh with, he launched Yesware in 2010 with his trusted WGR Media co-founder Cashman Andrus, and Quova co-founder Rajat Bhargava. “It’s a gigantic market that’s completely under-served,” says Bellows. So far the service has over 450,000 registered users, is deeply integrated with Gmail and the seemingly ubiquitous
Dealing With Obstacles, Looking for Cash & The Startup Life:
Along the way Bellows faced what most entrepreneurs run into throughout their careers—naysayers and critics. Knowing when to heed warnings and when to wave them off is key, he says. “The person saying, ‘this is a stupid idea,’ might be right.” If you think they’re not, set milestones. If you don’t meet them, reconsider what you’re doing because the whole enterprise – or certain strategies – might be folly. “Doing a startup is the process of overcoming obstacles as you progress toward building your dream.”
Dreams are fantastic but startups exist in reality, and in this reality things cost money. Though Bellows didn’t take on investors in his first venture, he helped raise about $2 million for Floodgate Entertainment, another $9 million for Vivox and his latest adventure, Yesware, is fueled by about $20 million in capital from investors like Google Ventures, Foundry Group and IDG.
Bellows thought procuring $1 million in seed funding for Yesware would be easy – big market underserved, personnel with tech and business development experience, tried-and-tested leadership team with successful exits, etc. – but he was mistaken. “I had to talk to 45 different firms, micro-VCs, Macro-VCs, angels, angel groups—all of the different permutations of equity financing for a startup you could possibly imagine.”
Bellows advice to new entrepreneurs is to remember that securing an investment partner – at its best – should be more than just a business transaction. “You’re not just trying to find cash, you’re trying to find a partner that’s going to help you grow the business. Someone you respect, someone that respects you; someone who’s curious, someone who matches your particular personality in a complimentary and additive way.”
The good news, says Bellows, is that not only is it easier to secure capital and investor partners these days, the ones you find are more accommodating than they used to be. In the Boston tech scene of the mid 1990s in which he cut his teeth, venture capitalists were known to be rude and arrogant. “That has really changed because companies don’t need as much capital as they used to need. (Also) capital is much more of a commodity than it used to be,” Bellows explained. “I can go anywhere in the world to get my next round.”
These days there are also a greater number of former founders among the VC ranks that remember what a pain it was to deal with big-headed and abrasive potential investors. “They don’t want to be that guy.”
Building small companies brings a lifestyle element that Bellows freely admits to being addicted to. Startup life is intense, he says, and the tough grind makes workers feel valuable and appreciated. “Because things are so much on the razors edge at startups and because the beta between the highs and lows is so dramatic, I think it’s easier for people to feel valuable at startups.” That dynamic, Bellows insists, can be created in larger-scale companies as well, and building it at Yesware as the organization grows is one of his future tasks.
Follow me on Twitter @KarstenStrauss
