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Ep 14: Gregg Scoresby. On building the #1 fastest growing software company in Arizona

Ep 14: Gregg Scoresby. On building the #1 fastest growing software company in Arizona

Host: Joshua Strebel | Published: November 11, 2019

CampusLogic’s mission is to help schools change lives by driving increased access, informed borrowing and improved completion of student loans. Gregg has helmed the CampusLogic ship to becoming Arizona’s fastest growing software company with quadruple-digit annual percentage growth. In this interview Joshua talks to Gregg about their track record for abnormally high diversity in their workplace, the journey of building Arizona’s fastest-growing software company, the sensibility of taking a loan for a college degree, challenges around raising capital, scaling operations and more. Enjoy!

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Show Notes

0:00:35   Welcome and context
0:01:13   What’s it like to be experiencing 4-figure annual growth?
0:02:21   Can you talk about diversity and inclusion at your company?
0:05:21   “I don’t want to work in a locker room… when you have a diverse environment it’s self-policing.”
0:07:05   “If you have gender parity early in the company you don’t need a dedicated ‘diversity officer.'”
0:13:17   “Student success is made up of three pillars.”
0:14:49   Would your users say you’re just making it easier to borrow more or easier to manage their existing student loans?
0:17:23   “People with a college degree make on average $1MM more over their lifetime.”
0:18:57   “We’re not a lender, we’re a software company. We make software so schools can make every interaction mobile, simple and personalized.”
0:23:39   “There should be a matching structure in student loans just like there is with 401k’s.”
0:26:35   What’s the process like scaling your company up to 130 employees?
0:28:45   What was it like scaling past 40 employees specifically?
0:31:01   Did you raise money or have you grown the company entirely revenue-funded?
0:33:45   Was it difficult raising money in Arizona?
0:36:01   “Phoenix is a spectacular market for vertical SaaS companies.”
0:38:41   Do you think vertical SaaS companies can leapfrog the traditional product-market fit trajectory?
0:41:37   What’s next? What’s your 10-year plan look like?
0:44:35   You seem to have everything figured out. Have you made any mistakes?
0:47:23   “If you get the right people in the right roles rowing in the right direction, you don’t need to do much else.”

Show Transcript

Joshua: 01:01 Welcome to the podcast this week. I’m with a friend of mine, Greg scores, BF campus logic. Campus logic is in the student financial aid market and they were recently ranked 24th among all software companies nationally and the number one group, fastest growing software company in Arizona according to the inc 500. Please introduce yourself. Greg.

Gregg: 01:22 I’m Gregg Scoresby. I’m the founder and CEO of CampusLogic. Been doing this since 2011. First product’s been out since about five years ago and the growth has been both a fun and exhilarating, but it’s been quite a fun ride so far.

Joshua: 01:38 Jeez. Yeah. Talk about growth. I mean, you’re like in four figure percentage. Like what’s that like?

Gregg: 01:45 Well, there’s always something to fix, right? That’s one of the things that high growth means. There’s always something to fix, but it’s fun seeing, seeing something, particularly go from the early days where we just struggle to get the product right. We struggled to get the, you know, struggle to have the cash to pay our employees. And so it’s fun to move through that phase into a high growth. And see a lot of adoption in the marketplace of what we’re doing. So we’re, we’re, we’re, I think all of us here are pretty driven to help schools change lives. We, in fact, that’s what we describe as our purpose. We help schools change lives. And so, and what we’re working on right now is in the area of student financial success. And so it’s fun to have a group of people that are so purpose-driven and that’s been probably the most fun part of the growth for me is seeing the people that we’ve been able to attract, both on the employee side but also even on the customer side. So I love that. About the, about the growth,

Joshua: 02:44 you know, speaking of your employee side, I saw you recently wrote an article about diversity and inclusion within your company and you guys were able to cite some pretty amazing stats that over the last several years, your executive team went from zero to 60% female. Your leadership team from 37 to 50, and your company overall from 24 to 42% female. I mean, so you’ve literally taken, not that you were to begin with, but the old boys club and changed it up significantly.

Speaker 3: 03:16 Yeah. I have some thoughts on this that not everybody agrees with me on, but first of all, with respect to start up companies, small companies, you’re dealing with a small denominator here, the easiest way to get diversity is gender, right? So, and you know, in a, in a place like Arizona, there, there are variety of aspects of diversity, but in some pockets, you know, Arizona is three and a half percent African American, but the employee workforce here is 50% female. And so like you’d expect or you know, everywhere. And so, if you want to maximize diversity here, the easiest place to get it for a startup is gender. And then you know that that’s one view. and I think another view that I would say is I don’t think getting diversity, in your company because you just think it’s the right thing to do socially, is going to persist.

Speaker 3: 04:13 If that’s the reason that you think, Hey, we just should do it because we should do it and it looks good and the optics are good, then you know, I don’t, that’s not going to persist because it’s not not authentic. You know, I have a belief that we need the very best ideas from the biggest group of people and the most diverse group of people to solve the biggest problems. And we’re dealing with trying to solve some major student financial aid problems in this country and we need the best and the brightest, and that’s gonna come from the most diverse set of minds. So this has been a business strategy for us. Not, it’s not, it’s not window dressing, it’s not, not, not optics, but I view it as a competitive advantage. and so it’s something I really prioritized. And interestingly, we’ve gotten, you know, all forms of diversity, everything you could hope we would in, in diversity we get just because we prioritize gender diversity pretty early.

Joshua: 05:06 Yeah. Well, it’s simply, it, it is obviously, like you said, the easiest one to start with, but what you’re saying totally makes sense. And that the more varied opinions and experiences you have in the room, the ideas that generate out of that group are going to be better overall than if it’s the same, you know, homogeneous group where everybody’s kind of had a similar experience. I mean, they’re just their realm of context for coming up with new ideas as much smaller than kind of the big open tent.

Speaker 3: 05:39 Yeah, that’s definitely true. I would say there’s another, there’s another huge aspect of, of this for me. So look, I don’t want to work in a locker room. I don’t want to work. I don’t want to work with a bunch of dirt bags. I don’t want, I want to work in a culture that is professional and doesn’t require a lot of policing. If you have highly professional women and men working together, too oriented towards solving big problems together, there’s this self policing aspect of, of your culture that is so powerful. You don’t end up with a lot of, you know, crazy stories around women feeling marginalized because they’re in leadership positions. Right. My half of my executive team is, is female. And so, you know, that’s a, I think there’s a, there’s this aspect of culture building that is critical. You want the, if you want the, the least toxic, most healthy, you know, most powerful culture, it needs to be, it’s going to come from a diverse set of, people

Joshua: 06:41 [inaudible] and you know, not, not to lump, you know, most male workers into the same category. But I’ve found that half to 99% of the time, we’ll say it’s, it’s simply ignorance, right. And that definitely the phrases they choose to use or the, the, the, what they consider might be work appropriate. It’s just, it’s always been that way and it only takes that one maybe two times for that subtle reminder is like, Hey, okay, that’s not appropriate. We’re not gonna do that here. And you know, everybody snaps right into shape and the reinforcement of having that more diverse workforce, I’m just makes that process happen a whole lot faster.

Speaker 3: 07:20 Yeah. Yeah. I totally agree with that. I, I’ll, I’ll, I may offer one other kind of tangent to that, that, your listeners may not love what I’m about to say, but I’m gonna say it anyway. Whenever I see a company that has some leader that says diversity and inclusion in their title, well there’s, I have a couple thoughts. One, I liked that a company’s working on something on there, but two, I also think you must have had a problem and you didn’t plan for this early enough. Otherwise you wouldn’t need this role. If you architect this into your company early, if you have gender parody, for example, early in the company, the likelihood or in diversity in general early in the company and at the end it grows up with the company and it’s part of the company, then, you’re, you’re probably not gonna need someone whose job this is because it’s all of our jobs.

Speaker 3: 08:15 It’s not one person’s job. It’s all of our job to make sure that we have, we’re getting the best and brightest talent from all corners of the country here. and to bring those people in to solve the biggest problems. And so, you know, I w it’s, it’s all of our, all of our problems. You know, the other, the other thing, the other thing I want to just comment on this, to that I, I mentioned that you mentioned the article that I wrote about this. I, we don’t have a single employee that’s here because of their gender or their F. so we have people here because they’re awesome. So what I always tell our hiring managers is, here’s your, you need half your pipeline to be from underrepresented groups in, in early on it was, Hey, just go get half of people in your positions or to be a female like struggle, start there, go have half of your hiring pipeline to be female and then hire the best and brightest from that.

Speaker 3: 09:14 And what I found is a, our hiring managers knew, okay, this is important, like gender, diversity’s important and we’re going to hire the best and brightest. But I never, I never talked to people about who they hire. People should build them, their best teams. But I do talk to our people about, Hey, how diverse is your pipeline? And so if you focus on the pipeline, it, you know, it all people all feel good and they know that, Hey, we were, we had 15 applicants for this role, you know, eight of them are women, some of them were men. And we picked the very best person for that role, for, for this, from that pool of people. Magically you end up about 50, 50 in the company. Right now we’re 50, we’re 45% female, 50, 55% male for the company as a whole, which is, you know, probably top top core tile with respect to software companies, you know, and so it’s something I’m really proud of. I think it’s a huge competitive advantage for us. And, it, it also drives our retention, our employee retention, way up as well.

Joshua: 10:16 To echo that point, I asked a close friend of mine, Aaron Jordan, exactly that question. How could we, further diversify our workforce? And, and the first thing out of his mouth was your pipeline. Are you recruiting a diverse, pipeline? Are you filling it with various sources? And then from there you just pick the best, like you always would, but you focus on widening the intake or the top of the funnel.

Speaker 3: 10:43 Yeah. And to be fair, there are positions there. There are some positions where it is very hard to do. So, you know, there’s not something systematic in, in many companies. I won’t say all companies, but in many, probably even most companies, I don’t think there are systematic discrimination happening, against, women in software engineers. I looked at, I’ll give you an example of something I did a few years ago. I am a known LinkedIn stalker and I’m not a creep, not a creepy stalker, but I, I’m chief recruiting officer here and, I pulled up, we, we are, we use Microsoft Azure platform platform as a service and we were looking for a software engineering talent. And, I, we’re always looking for software engineering talent. And I pulled up, I just looked up.net as I looked up, or I might have looked up Azure, also.

Speaker 3: 11:42 And, and I, and I searched for within a 25 mile radius, she used to be able to do this in LinkedIn, 25 mile radius of our address. I looked for every software developer and I found about, I think was about like four or 5,000 LinkedIn profiles. I went through every single one. And not every profile you can tell a gender based on picture or name, but you can get a pretty close idea. And it was about 10% you know, we’re a female, 10 maybe, maybe, but less than 15% so one of the things we need to fix in this country is we need to be constantly driving to attract more women into STEM in general. And we need to make sure that we’re attracting women into software development roles because there’s such a critical, they play such a critical role on software development teams just like just like all developers do. But I think we need, we need diversity of thought and experience and opinion in all of our teams. And so we’re a, we’re lower than I would like on our software development team where right around 30%. But I’d like to, I like to pull that up to 50, 50 if I, if I could over time.

Joshua: 12:49 [inaudible] yeah, it is tricky. we obviously were in software as well and for a while we had 50% and we just made, several hires and they tended to skew to one column. So now our, our, we’re down in the 30s again about like you are, but yeah. You know, it’s, it’s somebody told me the other day, it’s a journey, not a destination. Right?

Speaker 3: 13:10 Yeah, yeah. Something we’re constantly working on for sure.

Joshua: 13:14 So you know, you talked about STEM and education and that just happens to be kind of what your forte is with your business, your campus logic is the way I understand it is a, is a platform for universities to help onboard their new students with their financial aid, right?

Speaker 3: 13:31 Yes. Yeah. So we, we look at the market like this I think, I think, there broadly speaking, there’s this student success market in higher education and student success is made up of three pillars. There is academic success, which means that I have an academic plan that I make progress toward that plan yet to get to the degree that I wanted. There’s career success. Did I have a career plan? So the whole reason I’m going to school is to have a good career but did not have a career plan. Did I make progress toward that career plan, develop the skills I need to get the job that I need and to have success in that career. But what’s been often forgotten, it is a forgotten his student financial success, which is that third pillar. So did I have access to the resources that I needed to get the education?

Speaker 3: 14:17 did I not borrow too much? We want to make sure we’re managing, borrowing, making sure borrowings happen in an informed way. And then I have the resources to complete. And ultimately if I did borrow, was I able to repay what I, what I borrowed in a, in a reasonable way. So I call that the ABCs of student financial success. We want more access, we want less borrowing and we want more completion. And so we’re trying to, we’re building, we’re, we’re a software company that is delivering tools to schools and becoming the digital storefront for financial aid, if you will, to make every mobile simple and personalized and in the process drive more access, less borrowing and more completion.

Joshua: 14:58 Okay. So I got to quickly bring up the elephant in the room. You do say to your credit, less borrowing, but student loan debt is probably the biggest concern of everybody under 40 right now. Yeah. Yeah. And would your critics possibly say you’re just making it easy or for us to sock ourselves with more student loan debt? Or would would your critics or not your critics, your users of your platform say, actually this helped me keep an eye on what I’ve borrowed, where it’s allocated, what might potential payback terms may be and you know, have more financial sense about the money that they’re using to educate themselves?

Speaker 3: 15:40 Well, let me, let me give two answers. The first answer is, sort of regarding the conversation that’s happening nationally around student debt. So I sure, I think there’s too much student debt. There’s like one point $5 trillion worth of student debt on the federal balance sheet. I mean, to be clear, if you looked at the federal balance sheet and just the portion of student debt that’s on a federal balance sheet where a country, just that portion where it’s own country, it’d be something like the seventh largest country in the world only. So it’s gigantic, right? It’s enormous. So, but, but, but I also, what bothers me a bit about the conversation is do, do, are do some of the people that are currently running for president really think that higher education has no value and therefore should be valued at zero. So, or you know, and I, and I think a lot of people think, Oh, it should be free like K-12 but, without going into too much around there, I think where, you know, a Honda accord costs a brand new Honda accord costs about $27,000, right?

Speaker 3: 16:44 The average rate of indebtedness at a four year public university at graduation is about that same dollar amount. Like, so, so where’s the public outcry about the student? About the debt being borrowed for the Honda accord? Right. I mean, like the people are borrowing money to get a degree and if, and a college graduate earns about a million dollars more a year than a high school graduate, there is utility in education and we should not act like there’s not utility it is worth borrowing for. But this example, the examples that get thrown around there around, Hey, this student had $200,000 in student debt. Those are anomalies and they should never have happened to be sure. But if you look at the average and where we’re at, there’s for most students in this country, there’s not overborrowing happening. We have a completion problem where people need to actually finish their degree because dealt without degree is, is bad here. But I think some of the rhetoric is doing a bit of disservice here to the value of higher education. Would you, you know, it’s a, it’s a proven fact. People with the college degree make about a million dollars more over their lifetime then those with a high school degree and so there is incredible utility. I think it’s, I think it’s an asset worth borrowing for. I do think there is some overborrowing happening and we needed, we need the tools to do that, but I don’t think we should throw the baby out the bathwater here.

Joshua: 18:10 Yeah, no, I agree with that point. And I think public education, public schools, you know, you have a [inaudible] down here, the street or ASU over there near you. And I actually went to NAU up in Flagstaff, you know, 20, 20 to 30 grand for an undergrad. That’s does seem reasonable. you know, and if we can keep a lid there, you know, there’s always inflation, but if we can keep it kinda relatively Honda accord ish, right? Yeah. Oh yeah. I think that’s fine. The issue I think most people run into is, you know, there’s such the, the tiger moms are driving kids to stand for driving kids to yell. And if they’re not getting scholarships, you know, it’s 80 grand a year or then you have, you know, your postgraduate or your med school or something and that’s when those bills just get gigantic. But hopefully if you, if you did go to med school, you’re a brain surgeon and you can afford your student loan payment.

Speaker 3: 19:04 So I love that you brought this up. This was the second part of my answer that I didn’t, I didn’t give earlier in my long answer here. the, so one of the things I think that’s happened on in colleges, universities today is I feel like there’s been substantial underinvestment in student financial success, the software that can enable it. And to be clear, we don’t make more money when students borrow. We don’t, like, we’re not, we’re not a lender. We’re a software company that we sell software to schools so that they can make every interaction mobile, simple, personalized, right? And, and students are getting personalization everywhere else in their lives. Netflix, Amazon, they’re getting recommendations for total personalization, right? But they’re not getting that in the financial aid, advising that they’re getting. So our school’s making a recommended borrowing amount to students based on their degree and career choice.

Speaker 3: 19:58 Most schools are not doing that and all schools should be doing that. and so that sort of deep advising driven by, recommendation, recommendation driven software should be happening. And that’s what we’re trying to drive in this country is how do we help people borrow the right amount, not too much, not go crazy in debt for this philosophy degree that they’re not going to be able to turn into a, by the way, I was a psychology undergrad, so to be clear, I am from some experience about a undergrad degrees that might not yield the biggest return on investment here, which is why most of us have to go to graduate school. but the, but I do think that that’s, a, an important thing to think about if schools have the right tools and the right orientation here, we could be making recommendations

Gregg: 20:48 to students to help them borrow more responsibly, get access to the education that they need and complete faster and at a higher rate if they have the right software to, to, and tool set to do that. So that’s what we’re trying to drive is to, to drive better student financial outcomes, higher repayment rates, lower borrowing and the like that using modern software to do that.

Joshua: 21:11 Yeah. My, my example there would have been the, the classic liberal arts degree, you know, like an English lit major who’s 90 grand in debt. It’s like, why did you do this?

Gregg: 21:21 Yeah. Yeah. I think, I think that’s, I think that’s tough. And by the way, a lot of schools, it’s not, I don’t think schools are indifferent to this. I don’t mean to suggest there in different to this at all. I think that, there’s a regulatory framework that’s not always conducive to operating within. And so, I think a regulatory framework could be, could be modified to, to make it easier for schools to, to not, let the overborrowing occur. And I think that, I think schools are also under resourced as well, to do this, but there’s no question that we need to make sure that there is a meaningful return on, on educational investment in the educational dollars that go in our producing, real, personal benefit to the, to the, to the students and the graduates. So, and I think, I think there’s, I think that our tools enable that. Yeah. So, there’s something that we care a lot about and is I think, I think you look at our customers, they care about it too. It’s why we’ve, why we had the growth rate we’ve had is that I think schools care a lot about this. And you, you see people recognizing that a modern software well architected, modern software that transforms the student experience can make, good recommendations and better borrowing decisions.

Joshua: 22:37 Yeah. Hey, I want to talk about that growth on, on your company side. You know, employees scale the software. But first little anecdote, I just tweeted this the other day. I got my student loan statement, you know, I’ve been out of school 16 years and whatever the market was in 2003, interest rates were amazing and I was able to consolidate, like about about $24,000 and you know, Honda accord, from my undergrad degree at 1.6, 7%. And I just felt like that was free money. So I’ve just taken my time, you know, paying off my student loan. Like I could’ve wrote the check years ago and just canceled it. But it’s like I identify with the 1.67% interesting now and I just, I don’t know what, what, what the consolidations are now. The consolidation rates are now, but hopefully, you know, they’re low. [inaudible]

Gregg: 23:28 yeah. Well, I think, look, I think there are a bunch of solutions that can happen on the repayment side. We’re not in this business currently, but, one of the things that you mentioned earlier in this and the podcast about, something that young employees are, care a whole about it is true. There’s been a multiple surveys here that have, where students have said, I’m sorry, recent alumni have said, Hey, I care more about student loan repayment assistance than I care about health insurance or a 401k. And, and so it’s not easy at the moment to get matching a matching structure, in the tax provisions that there should be a matching structure for students just like there is for a 401k match. So we make a 401k match for our employees. We happen to also offer a student loan benefit as part of a wellness program we have, but it’s not. but it’s taxable, you know, tax benefit.

Joshua: 24:24 Yeah. That’s actually a genius idea because really if you’re 25 and you’re coming right out of school, the, the, the horizon, the Hill of retirement so far out in front of you, the four one K is kind of meaningless mentally. Yeah. But also it’s meaningless practically if you’re buried under 90 grand of student loan debt for the next 20 years. So yeah, that’s an interesting, perk perhaps maybe companies should be looking at if you want to hire a young employee workforce, scratch the 401k until like year six and just help them with their student loan payments.

Gregg: 24:59 Yeah. The, the challenge with it at the moment is that it’s taxable. It’s compensatory to both the employer and the employee, unlike a 401k. So we need to change our mindset in this country and view student loan repayment, just like a health benefit or a, or a 401k benefit and treat it as sort of a financial wellness, benefit that is favorable tax treatment. So, to be honest, I’m, I’m not super excited about some of the stuff as a taxpayer about some of the debt forgiveness programs that are out there. I do think some targeted debt forgiveness makes a ton of sense, but across the board, non means tested. yeah, forgiveness I think is, not the best use of taxpayer dollars personally. I mean, I’m not saying that as a, as a campus logic employee year, I’m saying that as a, as a taxpayer, but, I think corporate America would gladly sign up for a retention tool as a, you know, this benefit to their employees and help pay down debt faster.

Gregg: 26:02 You’d have better repayment rates and more of that one point $5 trillion of student debt coming back to the federal coffers if you made just small tweaks to the tax code to allow to allow this to happen. And it would be substantially better for both taxpayers and student borrowers that are repayment if we did that. So, by the way, I do think I came up with this idea. But as it turns out, when you don’t act on building a product around that idea, lots of other people execute on I. And as it turns out, I didn’t come up with the idea. I thought, I also thought I was the one who came up with the word mockumentary and then I realized spinal tap came up with this word mockumentary like, like 15 years before I did. So anyway, I’m not quite as innovative

Speaker 3: 26:44 as I often think I am.

Joshua: 26:45 Oh. But it’s, it’s, it’s all of the execution. Right. And so let’s talk about execution. How campus logic is only, you know, less than 10 years old and you’ve taken it from, I’m gonna assume you’re your small office to now, like I said, the number one fastest growing software company in Arizona. What’s it like on that journey and what’s it like scaling like the process and the, and the business side of it? You know, cause when you’re eight employees, you know everybody, when you’re hunting, when you’re hundreds of employees, it can become really impersonal.

Speaker 3: 27:21 Yeah. One of the things that’s been, we have about 130 employees now. you know, we had, yeah, we had a 15 employees five years ago. it’s, the growth is now a lot the, I will say the, and, and then there’s some other things about that that, you know, I won’t go into too much detail on, but we also are, have been highly efficient in the use of, of capital and growth and pretty disciplined in execution. But the job, the job, my job has just changed so much over the years. You know, five years ago I was the sales and marketing department, you know, and we now have, about 18 people in sales. We’ve got about 12 people in marketing, you know, plus you had a little bit of sales leadership on there. You’ve got about 35 people there or something like that, you know.

Speaker 3: 28:14 So it’s a, it’s a lot that we’ve got there and it’s working, working really well. But every time when you grow and you’re building a company like this, there’s always some aspect of your job that you’re peeling off. You know, there’s some, you know, there’s, when you bring someone in to lead product and all, you’re no longer involved in the product. When you’re bringing someone into lead sales, then you know, you know, you’re no longer the sales leader, bring somebody to lead Mark and you’re no longer the market leader. And so it becomes a lot more about building the team and getting out of their way, removing barriers for them and getting out of the way than it does about, you know, doing the day to day. So I spend a lot more time focused on longer term, issues. But, you know, I’m, I’m focused, on, on a few things that I like to call, you know, company culture and customers. Those are the three CS that I, I focus on. and so, but those things of, of the mix of those things have changed quite a bit over, over time.

Joshua: 29:13 What was it like, at 40, 40 employees, that seems to be kind of like a ceiling that a lot of companies kind of hit. And when they do, sometimes they don’t, but when they do break through them, like that’s when a lot of things can potentially go haywire. Yeah.

Speaker 3: 29:30 Well there, you know, the way to think about this also is there’s some number of direct reports that anybody can have. And so let’s say it’s, you know, six to eight in a software type environment.

Gregg: 29:42 So you’re right, when you got eight employees, it’s kind of just, you got eight employees, I got one PR, you got seven people reporting to you and, and it’s, that’s how it is, right? And in 40, you’ve got probably like four or five leaders you’re managing, you’re managing four or five managers that are managing people. And so there is something to that number, you know, 30, 40, 50 people in that, in that area, things start to change. So one of the things we’ve done that, was just happened more informally prior to that is a few years ago, we put in a biweekly meeting company. We do a company lunch every other week. And, and then I, and then I’m sharing a few, specific metrics about the company. Some of them are one. So I’ll alternate between looking at a financial metrics and some other operating metrics. We use a product also where I collect employee feedback and we’re looking at employee net promoter score.

Gregg: 30:42 And I’m, I’m sharing that feedback publicly so people can see how we’re doing there. I want to be transparent, you know, transparency breeds trust. So if you want a high level of trust in your company, there is no other way to get that than being highly transparent, including what’s not working. Like we are, we’re pretty open about, Hey, we’ve got to fix this thing that’s not working. It worked when we were eight people. Yup. Didn’t work so well when we were 40 people and we fixed it and then it broke again at a hundred people and we fixed it. So just the, the processes and the structures you have to put in place are different. There’s a lot more, I spend a lot of time around alignment and, communication than, than anything else.

Joshua: 31:26 yeah, that’s a pretty rapid scale. Now have you done that entirely revenue funded or do you have, outside investment?

Gregg: 31:34 We’ve a, so we raised some money, early on. In fact, we, we, we, we raised money a few times. but early on, I sold everything I had, to, and, to, to do, get the company going. We, we had a struggle with our first product. And so that wasn’t quite enough, but I had one early investors say, well, we just, we like it. we like to see our founders have skin in the game. And I said, Hey man, I’m skinless here. Like, I, I, yeah, I don’t have more skin. I’m like 150% of my skin is in here. And so, so I, after that kind of was exhausted and then some, and it really was probably 110% of my net worth. we, I went out and started raising money from individual goals. And we have this, we have this great local, angel network here.

Gregg: 32:29 There’s one in Tucson desert angels that I’m, I’m a big fan of. And they were early investors. there’s, Arizona technology investors in the Phoenix area. Those groups really well together. And then we also had some, a large family office and vast and a strategic and vast, but we, through that we pieced together this $7 million series a round that they didn’t come in all at once. He came in over the course of like two years, you know, you’re raising, we’re raising, raising, raising for that. And that’s really what allowed us to get over the hump. And then we raised a little bit more about a year, a year and a half after that to fund an acquisition. It was a small acquisition. We did that was really strategic. And then, about a year and a half ago we had a chance to, we offered, we had an investor offer to buy out all of our invest, all of our other investors.

Gregg: 33:23 And I had about, you know, a little over 55 investors on our cap table or that were owners, which is a lot. And, we, we basically bought all of them out and they made really good money and our new investors are, are doing really well as a, with our continued growth as well. So, but that’s, that’s a key part of growing the company as well as making sure you’ve got the right, capitalization structure, right? Investment partners along the way. So we kind of went from seed investors, early stage angel investors and we added some, a little more sophistication around and a larger checks to do that acquisition, semi institutional money I would call it. And then, to a, a a private equity firm named JMI equity. And they’ve been a wonderful partner.

Joshua: 34:10 Was it difficult raising money in Arizona as compared to all the headlines you read out of Silicon Valley?

Speaker 3: 34:17 I will say, it is hard to raise money, but I think it’s hard everywhere, you know. So when we started the company, I had people say things like, I don’t think schools are ever going to buy your software. And so, because they don’t change and, and, and we have a lot of domain expertise in higher education. So we’re like, well, that’s not true and we can see it happening already. So, I think that people need to believe, no matter what, people need to believe that you’ve got a team and an idea and a product that can, that can execute and that you got to prove that no matter where you are. I will say that I think there are some people that think have, I’m going to put a, put a deck together, talk to a few people and go raise money.

Speaker 3: 34:59 That’s not that my experience. I mean, I’ve talked to a, I’m not exaggerating several hundred, investors, over the years. And I still talk to investors even though we’re, you know, we’re not taking outside investment, not looking for it. I still talk to investors. I was in San Francisco two weeks ago. I was in New York, New York last week. I do this, I do this about twice a year where I just want to keep in touch with people. So if there’s a company we want to acquire, something we want to do there, I want to make sure we have the access to capital to do that.

Joshua: 35:32 Yeah. So, another success story recently in Phoenix was a web PT, right? They, yes. Good, good friends of ours, Sally and I’s and yours as well, Heidi, Heidi, and her partner Brad there, the company, great success, right? So you’re kind of chasing them, you’re like right there. And it’s, it’s amazing to see these two awesome kind of homegrown home built companies come out of nowhere in new markets, right? Because they took paper driven, medical records and physical therapy and digitize it and you’re taking this horrible FAFSA check the box. Like I don’t know what I’m putting here and digitized it.

Gregg: 36:17 Yeah. Yeah. So, I, one of the things I love, I’ve done a little bit of angel investing and continue to migrate back to this is I love vertical software companies. So vertical softwares, service companies. And when you think about Heidis experience in particular, Heidi, is a, physical therapist, right? And she had very high level of domain expertise in her area. She was, she was highly aware of the problems in the industry. And I think you, whenever you see a vertical SAS company that scales, you usually have some of that. So I operated in, in financial aid early in my career. I started another financial aid tech enabled, outsourcing company previously. So in vertical SAS companies, there’s usually those that are scale and have successful success. There’s usually a high level of domain expertise on the, on the founding team or on the executive team that, where they’ve got a lot of domain expertise and they’ve gotten good.

Gregg: 37:20 they’ve got the ability to build a highly scalable and highly stable product. So brand for example, I, I, web PT, great architect, great product guy, great. You know, great development in mind, as well. And so, you know, I didn’t have a cofounder at campus logic, but really early on, Chris Chumley, my chief operating officer is who, who was part of the company who built the, he was the head of product for the first SAS based student information system. He, he was highly aware of how to build and scale software teams and product, in higher education, particularly around, you know, student and student experience. So, so that’s been really valuable to, to how that, but I do think you see those parallels. And I think markets like Phoenix are perfect for vertical SAS companies because there’s no reason to be in the Bay area for companies like ours.

Gregg: 38:11 We don’t sell the Google, we don’t sell Twitter. We don’t, there’s no, we don’t have customers. We do have some customers there, but, but not, they’re not tech companies where I need to see them every day, their schools. And so, you know, I think you see vertical SAS companies all over the place and you see this happen, you know, in, in what I would call, you know, secondary markets that is, as investors often call them, not San Francisco, not New York, not Boston. Right? Yeah. And so I think Phoenix is a spectacular market for vertical SAS companies. and, and I, and I love that. I think there’s a lot of parallels between what we’ve done and continue to do and what, what web PT did so remarkably to, to scale within the physical therapy. practice management software space.

Joshua: 38:56 Yeah. Domain expertise. That it’s like a shortcut. I’m thinking because every company they’re taught based on the lean startup methodology, methodology, product, market fit. You’ve got to find product market fit, you’ve got to interview your customers, understand what your customers want and then build and deliver that thing. But if you’re like literally the domain expert and you’re like, Oh, I, I am the customer to some degree, I know what all these problems are, you’ve kind of leapfrogged the head that whole like phase two, phase three and you’re already, you know, running down the path with a huge lead on the competition.

Gregg: 39:32 Yeah. This is a bit of a, this is a bit of a cliche, it’s been quoted so many times, but you know, Henry Ford was apparently was the one who said, well, if I would have asked customers what they wanted, they would’ve told me to build a faster horse. You know? And so I do think there’s some of that in vertical SAS companies. When we built our first product and I would describe it to, to potential customers on the phone, they would say, Oh, I don’t need that. I already had a student information system. And I would say, can I just show you a demo because we don’t compete with the student information system at all. We’re replacing all the manual interactions. You have paper forms. Yes, we replaced all that. and do you have, do you, are you, receiving those via fax?

Gregg: 40:16 Yes, we replaced all that. do you receive them via email? And they’d say yes. And I say, well, it’s not secure and and you shouldn’t be doing that. And we replaced all that. And so let me show you the product and we would show people, Hey, there’s, there’s this TurboTax like experienced this wizard driven guided experience for financial aid. And to be honest, we didn’t, we didn’t have customers initially say, you know, what would be great is a turbo tax like experience for financial aid. But after we showed it to people, they would say, Oh, I love this, I’m going to buy it. And could you also add this? And so I do think a lot of times in vertical SAS companies, it’s not the customer input that lead to the first version of the product. It’s the subsequent iterations that help get informed by us.

Gregg: 41:04 So we have a really close relationship with our customers. We receive enhancement requests all the time. We say no to a lot of those because, you know, we’re not, we’re not going to write custom code. We’re, we’re, we’re taking all the best practices and driving uniformity and consistency in the product there. But, but I do think that you see that in, in vertical SAS companies where there’s a high level of domain expertise that tends to be, that has a, that is acutely aware of the problems in the industry. And, and also there’s some personal annoyance, right? I’m, I’ve been personally annoyed for years about how lousy the financial aid experience is. It’s bothersome. And usually if someone’s bothered to the point where, and Heidi actually probably as an example of that, she was annoyed with, with the, the challenges she experienced in managing our own, our own physical therapy practice. And so I think there’s, I think there’s, good examples of that in a lot of vertical SAS companies and, and I think we’re no different in that respect.

Joshua: 42:02 So what’s next? What’s on your horizon? Are you just, developing an, another product within this channel, or do you, do you, are you, I in an IPO at some point? Like what’s your 10 year plan look like?

Gregg: 42:17 You know, one of the things that we, I think we’re good at a few things. I think we’ve made plenty of mistakes too. I’m always want to be self aware about that. But one of the things we’re a, I believe better at than almost any other higher education technology company out there is, is building product. We, we struggle to get the first version of our product right. I mean, we really struggled in 2013. We scrapped, we, we built this product that didn’t work. We scrapped the whole thing and rewrote the entire product. And I’ve talked about that publicly before, but it was a super hard time for me personally for the company. It was just really hard. But what came out of that was, we became pretty obsessive about being great at building product. So we launched our new version brand new version.

Gregg: 43:02 Didn’t use a single line of code from the old one. In 14, we launched the next product and 15, the next one in 16. The next one is 17. The next one in 18. We just, we, we bought a company this year, rebranded the product, and, and launched that, launching that this month. And then we have our seventh product coming out in a, in about a three or four months from now in, early, early 20, 20. So part of launching a new product every year as part of who we are. And so we’re growing the size of the market by doing that. But we, we’re just gonna keep building and delivering great product to help transform the student financial aid experience and, and really drive student financial success. We, we want to drive the best automation, we wanna drive the best analytics. We want to drive the best advice and experience that students can have. so that we can enable student financial success.

Joshua: 43:52 That what you said caught my ear, that you’re passionate about building good products and like, rather than, I know your, your big mission is student financial success, but internally it’s like we’re a product company and we better be damn good at building products.

Gregg: 44:12 Yeah, that’s exactly right. Yeah. We, we, it’s a core competency, right? People, I’ve had people say, Hey, can we help you build, build, build software for you and in India or in China? And, and this is our core competency. We should be better at this than anybody else. So, and we think we are better at this than, than in, in, in higher education, in our little corner of the world. we’re, we’re innovative, we’re nimble, we’re spending more time and money building songs off where against the problems in student financial success than anybody else in the world. Nobody’s investing more to solve student financial success than we are and, and we should be doing them. That’s who we are as a companies. We should be spending resources, and, and, and creating, and solving problems, uh, against that mission.

Joshua: 44:57 You know, Greg, I, I’m not trying to fluff you here, but it seems like you got it all together. Like you, you’re using the right words. You’re saying the right things. You, you, you most certainly have demonstrated with success. Was that always the case? I mean, 20 years ago, right out of college. What was your first, idea, like what was your first job like? What were the steps that you had to take to eventually arrive at here?

Gregg: 45:23 Well, look, a lot of things are going right, but I don’t think you have to go back 20 years to look at my mistakes. I mean, you can, right? But earlier today, I’ve got a list of things I made picks on, but I will say I’m, I’ve always been pretty entrepreneurial. when I was in college, I, it occurred to me that, there was, I, I will was in the state of Utah and it was harder to get, it was harder to get into school. in some of the schools there, there was, there was a cap on enrollment and it occurred to me the standardized testing was going to be a critical thing. So I started at test prep company, that, was, I, I can’t even use the word successful in the same sentence. It was a, I don’t know if I’d say failure, but we didn’t, we didn’t scale for sure.

Gregg: 46:12 And I, you know, gave up after not that long. And I would say all, I wasn’t that into it that much. I started a, another small company that I didn’t spend any time on, but did it. And as such, it didn’t go anywhere. but when I went back to business school, I knew that one of my longterm plans was I wanted to, I eventually wanted to start a company. So I did join a big company. After business school. I joined Arthur Anderson and worked in the consulting practice of that firm and the old and the outsourcing, practice there. And that I learned a lot at that place. I learned a lot about process and structure and discipline and how to, how to, you know, deliver good quality service. And so, that was pretty formative for me. But, yeah, I’ve, I’ve been, I made a lot of mistakes along the way for sure and tried to be self aware about it and, you know, the happiest people I know or the most self-aware people. So I tried to try to be more vulnerable and more, more overt about the mistakes I’ve made. Just, you know, more than, more than anything just to feel peace about, about, about where I am in life. But so yeah, I’m really proud of where we are and mostly proud, at the moment of just the team that we have. We’ve got this group of women and men at the company that worked so hard and worked so well together

Speaker 3: 47:30 and care so much about the problem that we solve. And so that’s the thing that I’m most proud of is just the, the people that we’ve got and the problems that they solve. And when you get the right people, I, I’ve been known to say that every problem is a people problem. And what I mean by that is every problem can be solved by people. And if you get the right people in the right roles going in the right direction, you don’t need to do much else. Right? Cause they, they’re motivated to solve problems, just get out of their way. Just make sure you get the right people working together, going in the right direction and and the magic sort of happens without you. And that’s been a, that’s been a valuable lesson to learn. I, over time

Joshua: 48:09 getting out of the way. That’s, that’s hard and easy. And scary all at the same time. We had a conference last week and one of our speakers, he had scaled his software company from zero to I think like 80 employees or something. And they do software development, right. And he was on stage and he was kinda saying, you know, yeah, I’m CEO, I’m not the best developer anymore. I have this process and we have these great team and there’s days I sit there in an existential crisis. Why am I here? Like what, what use of my providing anymore.

Gregg: 48:49 Yeah. Yeah. There’s some of that. I think, I think recognizing, recognizing when you need to add someone else and why you’re adding someone else’s is important. Although, you know, there are people that, there are people that, you know, don’t want to run a company all the time and that’s okay. You know, if there’s someone, maybe someone’s happiest, we’ve had employees leave and say, you know, when I was happiest was when we had 20 employees. Well, you know, I want those people to stay, but if it’s not the right thing for them and they can’t adjust to, you know, how we’ve grown, I also want them to be happy. So there, I do think that for many of us, there are stages where we’re just more happy than others. And so we’ve had employees that are, are great, zero to $10 million in annual recurring revenue type people.

Gregg: 49:41 You know, they’re just, that’s where their happiest, that’s where they do their best work. And then we’ve got people that are, you know, great, 10 million to 30 million in annual recurring revenue people. And you know, we’re moving through that, that kind of stage now and, and and we expect people to, you know, we may, you know, we’re always going to be looking for people to the next stage and most of us can, can scale there. But look, I’m, I’m not a public company CEO. If this, if this company ever did go public and I can’t see that happening, it wouldn’t be with me as the CEO and I’m fine with it. I don’t want to build the skills I don’t want to do. It doesn’t sound like a fun thing to me. And so, and I think that’s fine. I think if you have self-aware people that know who they are, what they love to do, I sure makes a lot of things easier as you, as you scale along the path that no, no doubt the job changes. My job changes in some material way every single year.

Joshua: 50:36 Wow. Well that, Hey, so many, great little stories and why is advice that you offered Greg? as we end our time here, I just want to say thanks so much. you know, I met you a couple of years ago up in Phoenix and I’ve just been a fan of your work and you’re such a downer personal guy. So I just want to thank you for coming on the podcast and if you could go ahead and tell everybody where to find you online.

Gregg: 51:00 Yeah, you can find me on LinkedIn or our website of course is campus logic.com. I’m a occasionally active on Twitter at Greg scores. A two GS, three GS altogether, G. R. E. G. G. I will say that I’ve also found unhappiest when I don’t look at Twitter. And so, I’m probably a little less active these days, but LinkedIn is always the best place to find me.

Joshua: 51:24 Excellent. All right, well thank you so much Greg, and we’ll chat again soon.

Gregg: 51:28 Hey, good to talk to you. Thanks so much.

Joshua: 51:30 Cheers.

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