CEO Mitch Russo tells the story of how he built TimeSlips and sold it to Sage. Very entertaining as well as instructive.
Sramana Mitra: Let’s start at the very beginning of your journey. Where are you from? Where were you born, raised, and in what kind of background?
Mitch Russo: I was born in New York. I was raised in a small community called Manhattan Beach, Brooklyn. It was there that we basically started a rock band. Using the idea of how to build an entertainment platform as a rock band in high school, I learned a lot about entrepreneurship and I learned a lot about what it takes to make money and how to promote and share content.
I later used all of those skills to start a software company in 1985 with a partner. We grew that from a $5,000 investment to over $10 million in revenue and 100 employees. We sold the company to Sage PLC in the UK.
Sramana Mitra: I’m interested in how you did that. Let’s go through that entrepreneur journey. How did you go from doing a rock band to a software company?
Mitch Russo: It’s a fun story. After the rock band, I grew up and became an adult. I realized that I probably wasn’t going to be a Rock and Roll star. That was a deep disappointment to me. At that point, I started to go to work for different companies. I learned how to do things like selling. Selling was a very important skill that I needed to learn. I ended up selling semiconductors in the semiconductors industry.
I had to go to school to learn how to sell. I went to Dale Carnegie’s Sales Training Institute. There I learned the entire process of selling. I became, in a very short period of time, the top sales person in our entire industry. At the age of 25, I started generating between $30,000 and $35,000 in commission checks after going 14 months without even a single commission check. I intuitively understood that it would take a long investment in this process of getting my chips into the hands of the people who could design them into large volume projects.
The money was rolling in at that point. I was going after more customers and having a lot of success. Then suddenly, the semiconductor industry took a severe downturn. One day, I found out that our shipment to a large manufacturer was declined at the shipping dock. I got a call from the factory to go over there and find out what’s going on. It turned out that their sales had slowed down so much to the point where they no longer needed our parts. This started to happen to company after company over the course of a very short period of time – less than 60 days.
I asked one of the veterans in this industry, “Can you give me an idea of what’s going on?” He said that this is a typical semiconductor downturn and that it will only last four or five years. I said, “I’m out of here.” I had a good amount of cash and had a lot of ambition. I decided that I wanted to start my own company, but I didn’t know what kind of company to start.
Our conversation continues here.
This segment is a part in the series : Best of Bootstrapping