Max Shapiro Founded PeopleConnect in 2000 to help early-stage high-tech companies find the talent they need to succeed. Their clients are in technology, biotech, cleantech, apps, services, medical devices, and consumer products.

He is also involved in areas that also support the startup community:

• Angel Investor and member of Keiretsu Forum since 2001
• Co-founder of Runway Innovation Hub
• Creator & Producer of PitchForce
• PitchForce is a weekly pitch event for early-stage companies with a panel of establish angel investors and CEO’s

On today’s show we talk about

• How should a startup prepare themselves for a pitch event?
• How should an investor or a startup follow-up any contacts that they made at a pitch event?
• How much equity should be given to a new hire at a startup?

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Announcer  00:00

You’re listening to the Silicon Valley podcast. On today’s show, we sit down with Max Shapiro, who founded people connect in 2000. To help early stage, high tech companies find the talent they need to succeed. their clients are in the technology, biotech, clean tech app services, medical devices and consumer products. He’s also involved in areas that support the startup community such as he’s been a member of the Keiretsu forum, an angel community since 2001, he co-founded the Innovation Hub runway, and he’s the creator and producer of pitch forest, a weekly pitch event where early-stage companies get to present their companies to a panel of established angel investors and CEOs. On today’s show, we talk about how should a startup prepare themselves for a pitch event? How should an investor or startup follow up any context they make that a pitch event? How much equity should be given to a new hire at a startup, and much more. And don’t forget to share this episode and write a review on iTunes which encouraged us to make great content. all right now let’s start the show. Enjoy. Welcome to the Silicon Valley podcast with your host Shawn Flynn, who interviews famous entrepreneurs, venture capitalists and leaders in tech, learn their secrets and see tomorrow’s world today.

Shawn Flynn  01:23

Max, thank you for taking the time today to be on the Silicon Valley podcast. Now I have to say, I think if I were to take a survey of the most network person in Silicon Valley, I think you would definitely come up at least in the top three, if not number one. So with that, can you tell our audience a little bit about your career up into this point?

Max Shapiro  01:42

Sure be happy to just briefly it really started when I was 12 years old, and I was six foot one I was in the basketball and NBA team moved to my hometown St. Louis. They were the Milwaukee hawks, they became the St. Louis hawks and picked up the phone and asked the coach if I could be the waterboy and I got the job because I was the only applicant. The end of the interview. He said, Son you understand you just be working for prestige. Is that okay? And I said yes, sir. He said you know what that word means? I said no sir. That means you’re not going to get paid. Well, I wasn’t thinking about money. Now fast forward the first season I am in junior high school. I got to get bring some guys to help me. So I say hey, Shawn, hey, Jimmy. Hey, Steve, you want to come down my dad’s going to take us to the Hawks game against the Celtics, you can help me so in the Hawks bench or sit on the Celtics mansion. From that a guy who was a player on that team took me under his wing that box team in 5758 won the NBA championship and brought me the west coast where I scouted for San Diego rockets and then later the Phoenix Suns and started doing basketball camps with john wooden which was an incredible experience and ran baseball fantasy camps recreated the major league spring training experience with the Dodgers Yankees giants as I got into crazy business 92 to 99, my brother and I were partners in a business called Green for James we’re exporting 10,000 pair to 20,000 pairs of us Levi’s a month, bought one pair of 75 year old Levi’s that had never been more and bought them for 10,500 and sold them for 21,000. At a denim auction that I created in Tokyo. Fast forward to 1999, a friend of mine said you should get into recruiting and sold that previous business, the jeans business. So she taught me how to be a recruiter and first year and a half you me anybody else right at a high school could have made a couple hundred thousand dollars because the.com boom was going on. Once the bust hit then companies were coming to angel investors. I was a member of the Gretzky forum at that time, I still am 19 years later, and they were looking for half a million dollars for the software company. Most of them would say, you know, what do you need the money for? And they’d say, well, you need to hire a salesman because our software’s done. Or we need some developers because our software is not done. And we said, well, if you had those people on board, we’d be more likely to invest. And they said, Hello, why do you think I’m here, I got to have the money to hire these people and light bulb went off. And I said, there are people at home that are depressed and tired of doing nothing and tired of being an extension of their wife’s honey do list and maybe some of them would work for up to six months for options. And we were able to find people who would do that some people said we were crazy some candidates and they weren’t right for the job. But we actually got two people to work at a company for a year. And unfortunately, that company never got funded, but they had the experience of working for a year and being able to get on their resume.

Shawn Flynn  04:19

So this sounds like probably the most unique HR company in Silicon Valley, if not the world with just equity. That’s a genius idea. You’ve been with this angel group Keiretsu you for 19 years, you run a weekly pitch event. And like I said in the intro, you’re probably the most network person in Silicon Valley. When you’re giving advice to startups, and one of the things that at least I hear the very beginning, startups asked me, you know, how can I maximize my time? How do I know which pitch events to go to? What events? What recommendations Can you give those people when they ask you how do I maximize my time?

Max Shapiro  04:56

I would suggest that they go to the website of whoever’s putting on a pitch of them, see what people say see if there are panelists there that say good things about a testimonial and panelists testimonials from other presenters. And that’s really the best way to do it is you can check it out, always check references, that’s a very good way to do it. And then also, obviously, by networking means meeting other entrepreneurs and asking them about good pitch events that they’ve attended in that have benefited them.

Shawn Flynn  05:22

So if you go to one of these pitch events, and you’re in the audience, what should you be doing? What should you be thinking? During the presentations? How can you maximize your time in these events?

Max Shapiro  05:34

A lot of times the people who are in attendance are people with startups, they’re thinking about pitching themselves. And they should check out the companies beforehand, because they have the names of the companies see what they’re about educate themselves about the companies and focus in on how they did in the pitches in the with pitch forces a one minute elevator pitch all 10 companies do panelists vote on a scale of one to five and then the five top companies get to go to the second round, where they’re doing a four minute PowerPoint, four minutes of questions and answers in about eight minutes of feedback. Number one, in the q&a, write down the questions and see what questions are being asked. Because if you are presenting yourself in the future, that’s a really good way to prepare, and listen to the feedback as well and see what the panelists think about what you’re doing, what they like, what their questions might be. And then there are other people who are attending who are investors, and they’ve got their own agenda. And there are other people who just interested in the startup scene.

Shawn Flynn  06:26

What would a startup be ready to present at one of these pitch events?

Max Shapiro  06:31

really depends, we have two different types of events, we alternate every other week between companies looking for their seed round, usually half a million up to a million, they may not even have a beta, they may not have any revenue. If they do, that’s helpful. But we’ll still let companies in that are really early companies looking for they’re a round that are pitching to venture capitalists. And then those companies need to have some product, you need to have some revenue some month, month over month growth, etc.

Shawn Flynn  06:59

Saying I’m a startup right now I have a product don’t have any traction. But I think okay, it’s about time to go to a pitch event and tell the world what I’m working on. How do I prepare for that pitch event?

Max Shapiro  07:12

It’s really good question. I send out a template of in a minute, right? 150 words, because that’s about what we speak. And there are six points that you can cover for the four minute we say right out of 600 words, cover these eight points in order, starting with what is the why tell me why you created this business. It’s a lot better if you say I had this problem. And this is solution I came up with rather than four of us were sitting around, we want to do a startup and somebody had this idea nobody had experienced with it. So what is the Why? What’s the product? What’s the solution? And early on, tell us about the team. Because investors bet on the jockey they want to know about the team and waiting till the end doesn’t make sense. We had somebody pitch about a month ago, and he didn’t even mention when he got to the team side didn’t even mention himself. And so I asked him afterwards. Tell us more about you. Well, the guy was a PhD from Caltech, just like there are too many of those is like, dude, tell us, we’re impressed with that. And he was doing he had a solution for something in the LIDAR space, which required real strong technical jobs. So let people know that don’t be shy about who you are humble, bragging is fine.

Shawn Flynn  08:18

So what else should be in that pitch deck? And what other mistakes Do you find startups making?

Max Shapiro  08:24

One of the things that startups Don’t think about? They’re thinking about themselves, they need money, that’s natural, but you got to put yourself in the other person’s shoes and buy like to say, pitching and that panel, they’re the catchers. And they’re thinking about themselves. If I if an angel invest $50,000, in a company or a VC invest a million, what’s the ROI? What kind of return Am I going to get? When am I going to get it who are the possible acquirers and things like that you need to cover you know, are you the smartest person in the room on this subject? Why should I bet on you? Those are important things to cover the market. What’s the deal? Sometimes we get companies that really are not looking for their seed round, they’re not sophisticated, they know don’t know the difference between a safe note and convertible and price round. And they don’t even know what their valuation should be. So what I suggest there is look at your unclear if you knew this, rather than coming up with a figure that may be way off just starting, you think your pre money should be 10 million, which is five or 6 million too high. And what I suggest you say is, look, we have not set the valuation and what I would love to do is sit down with you offline and create a win-win for you as the investor and for us as the entrepreneurs.

Shawn Flynn  09:33

That’s fantastic advice. As an investor. Are you seeing more safe nodes convertible notes, what are investors for early-stage companies, what are they asking for?

Max Shapiro  09:42

investors would prefer convertible notes with a cap on the note entrepreneurs who would prefer to do safe notes either one of those are fine but what I hear somebody that’s really green, they don’t have a lot of experience doing a priced round. Well that costs so much more money, it takes so much more time you’re much better off doing a safe our conversion.

Shawn Flynn  10:01

Can you go into a little bit more detail on what each of those are for our listeners who are green,

Max Shapiro  10:06

priced round is you’re saying, I’m raising a million dollars and my pre money valuation is $10 million. And post money is going to be $11 million. So you’re going to get 11, you don’t say, nine 9% of our company, a convertible note, you’re saying that when with a cap on it, so if the cap is 5 million, you’re going to get a 20% discount, when the value gets to be 5 million, you’re raising money at 5 million, I’m getting a 20% discount on that. So I’m getting to invest in a $4 million pre money instead of a five I got a little interest. Safe note is similar. It’s just a there’s a few more benefits for the entrepreneur. And what I would suggest is, you know, as they talk to their, it’s also a little less expensive, they should talk to their startup attorney and anybody who gets in the startup business and doesn’t have a seasoned startup attorney is making a big mistake. You say, Hey, I live in Danville and I got this attorneys and family friend and he did a one startup ones, but he’s really doing transactional stuff. There are a lot of good somebodies around that do nothing but startup and venture.

Shawn Flynn  11:08

Well, then I guess my next question is, how does one find one of these attorneys?

Max Shapiro  11:12

I’m a little biased because I think my attorneys fantastic. His name is Eric Ferraro, he started a company called fathom law. And a couple things I like about him. Number one, he was a several time co-founder and startup CEO. We just didn’t go to law school and work for a big law firm and then go open his own shop, he had some nice exits, he sold one of his companies in the digital media space to Sony had a really nice exit. And he’s because he’s in a smaller shop, his rates are less, but more importantly, he’s just very direct and smart. And no BS. I work at a startup, I would not just talk to one I talked to two or three and then decide who you like best. And also another word of caution. If you go with a really big name firm, just make sure the person that you’re working with there is really going to have the time to work with you. It’s one thing to say, Hey, we got Wilson Sonsini or this firm or mopho, whatever, it’s the person that you’re working with. It’s important. Do your diligence, check these people out, just don’t take my word for it.

Shawn Flynn  12:11

How important is it that the people you work with the service providers, the accountants, you had mentioned lawyers, but accountants, bookkeepers, or tax experts? How important is it that they’ve also started a company for them to really know what it’s like to be a startup?

Max Shapiro  12:26

That’s a plus. I mean, they won’t all have had startups themselves, but we want them to have had a lot of startup experience. And again, check references, ask people, hey, we’re an accountant for startups, can you put me in touch with two or three other people you do work? It’s important to do that. We just switch bookkeepers. And I got three references. And I emailed them all on Thursday. And by I mean, on Friday morning, by Saturday afternoon, I had glowing reports on all three. So don’t just trust your judgment there. You got to do your due diligence and make sure that you’re hiring a real pro.

Shawn Flynn  12:56

And going back to the theme itself, you’d mentioned that sometimes startups don’t emphasize the people on the team who should be on a team for an early-stage company, just two founders, or how big should this be?

Max Shapiro  13:10

It depends on how far along they are. I mean, a solo founder is going to have a really hard time because what if God forbid something happens to that one person, initially, co-founders are important, hopefully a technical founder, as well as a non-technical co-founder, and you’ve got a great idea. And you can find a CEO who’s got some experience with taking an early-stage startup to a big prominent position. That’s something you should look for. And sometimes I see early-stage startups say, well, I’ve got an advisor and he told me about these two guys, and I like once I’m gonna hire them. And that’s not enough, you got to really be thorough. I’m a little biased. When we do a search for somebody, we come up a list of 150 people and interview 20. But whether you work for with a recruiter, or do it on your own, be thorough one of the cliches that you hear which I’m a big believer in is hire slow, and fire fast. Take your time in hiring, making sure that you really like this person. It’s almost like dating like the first stages of dating you like somebody and you think there’s two or three things about them that you don’t like, and they’ll change and get better and it usually doesn’t. They’re things that are bugging you, you’re going to be spending 60 hours a week with him or her You better make sure that you really like this person and take your time. Check references. When you get references, ask those people whose names you were given about other people that know Shawn or no, no Suzy, do second round reference checks that way. Well, that’s a good technique, but you know, take your time be thorough, and also if you’ve hired somebody that’s not working, cut it quick. I mean, just you know, give them another an opportunity, put them on notice and warn them and if it’s not working, they’re probably not happy either. So it’s not like you’re putting them out on the street with nothing to do they’d be better off finding something that gives them more fulfillment.

Shawn Flynn  14:57

About advisors, can you cut them loose as well? Or if you have an advisor is are you stuck with them.

Max Shapiro  15:03

You don’t have to have long term agreements with advisors, it can usually an advisor role can be six months and you get to renew it if you want. With advisors make sure you know how much time they’re going to put in replacing somebody on board of directors role for a startup that can help them get funded. We do some of that, but and his agreements going to be six months with our clients. It’s not like you’re signing them up for two years and giving them a whole lot of equity or a whole lot of cash.

Shawn Flynn  15:29

For an early-stage startup, what kind of equity would they be given an advisor,

Max Shapiro  15:35

usually, it’s a half a point or a quarter a point, depending on how involved they’re going to be. an advisor is looking for three, four points away, way too much, a little bit more certainly for Board of Directors, but it shouldn’t be allies should be somebody who was likes to help people, everybody, as I said, pays it forward in this in the high tech Arena in the startup arena. So you know, someone that says, oh, I’ll be your advisor, but I need four or 5%, that’s not even close to the ballpark.

Shawn Flynn  16:02

It should have started ever actually pay a salary to an advisor, for example, maybe give them a one point of equity, or 1%. And then also 1000 a month,

Max Shapiro  16:14

it depends on how far along they are some advisors do want a little bit of cash. And if they want a whole lot of cash just to be on board of advisors, their heads, not in the right place. But sometimes there’s a cash component and especially if it’s on a board of directors, its board of directors, they’re going to get a little more equity and get some monthly cash. And you have to as a as a startup entrepreneur, you’ve got to negotiate with them, how many hours per week you’re gonna get. And again, check, hey, this guy’s been an advisor, tell me about some of the companies you’re advising, I’d love to talk to the people that you’re working with there. And if they won’t give you the references, then just walk away, there’s something wrong.

Shawn Flynn  16:46

And you place people in some of the most talked about startups in Silicon Valley. How much equity do the people ask that you might be placed in and what’s kind of a conversation like there.

Max Shapiro  16:58

So what we do for our clients is we do a salary survey, which will show how much a VP of Marketing should be getting for a company that’s at this level or that level. Generally speaking, if it’s a CEO, and we just placed a CEO, for a medical device company in Cleveland, if it’s going to be a CEO, it might be 8% 10%. Or if it’s going to be a chief marketing officer, depending like the one and a half or two points, maybe a little bit more. But again, there are norms, and that’s one of things we do for our clients is we do salary surveys and show you here’s a low, medium and high what a person would be looking for both in terms of cash compensation and equity. We had somebody once who was a candidate for CEO role, he said he had to have 30% of the company, guys smoking dope, you know, we’re not going to waste our time with him Come on. If somebody you know, for a role, like a CEO said, they’d be willing to do it for two or 3%, I’d be a little worried that they weren’t really sophisticated enough to know that it shouldn’t be 68%, maybe 10%. And often, somebody in a position like that will want an opportunity to earn more cooling, that’s a good way rather than sad, I don’t want more cash, I mean, leaving this company, I’d like to have the opportunity to earn more equity.

Shawn Flynn  18:08

Can you kind of break down? So it sounds like a CEO 6 to 10%, CMO Chief Marketing Officer 1.5 to a 3%. What are the other positions? What should that initial C level team possibly get?

Max Shapiro  18:22

Yet, it really varies on how far the company how far along. If it’s a CTO, it might be three, four or 5%. If it’s a sales account, executive might be a quarter point or half a point. But the best way there is just let us do a salary survey for you reach out yourself and see what you can find online, so that you make sure that you’re reasonable in what you’re giving that person.

Shawn Flynn  18:45

So going back to the pitch event, one common question I always hear judges ask, tell us about the traction. And a lot of times I hear the startup go, what do you mean by traction? What do you mean by that? as an investor? Max? What do you mean when you say, Hey, what’s the traction to this company?

Max Shapiro  19:01

I want to know what kind of sales you’ve got, I want to know your month over month growth. I want to know your cost of acquisition CEOs, you can spit those numbers out our CAC is $3 and 42 cents and LTV is $27 and 32 cents when they can spit that stuff out. It’s really impressive. And if you see them hemming and hawing and trying to think what the number is, that’s not good.

Shawn Flynn  19:26

Okay, so say there’s a startup founder and he’s having hot he has no idea. He’s stuck on a question. What’s the best answer for him to give? What if he just doesn’t know?

Max Shapiro  19:36

Yeah, I think the best answer so I should have that right tip of my tongue. I don’t let me check. And I’ll be happy to get back to you tomorrow with that number. That’s the best way to handle it and just say, Yeah, I should have known that. I’m sorry that I don’t, but I’ll get back to you tomorrow morning with those numbers.

Shawn Flynn  19:52

And let’s say there’s a startup at an event. either an investor in the audience or someone on the panel really likes this company. What is the entire process Normally for that company, from that day they’re presented to, they get a check.

Max Shapiro  20:06

The timeline could be three or four months. But the next step is going to be an investor is going to reach out to that person and say, love to have coffee with you. Maybe it’s a virtual coffee, this zoom meeting, got an hour, or we can really sit down, dig deep into what you’re doing, because yeah, you whetted my appetite with this four-minute pitch. But there’s a lot more and companies need different types of decks too, you need a deck for a four-minute elevator pitch, maybe for a four-minute PowerPoint, maybe you need one for eight or 10. But you need a deck that you can leave behind. It’s more thorough and longer a deck that you can email out to somebody goal in any pitch event is to elicit enough interest and excitement, so that the investors want to know more. And I hear that I like what you do. And I’ve got some questions. I really want to learn more, let’s figure out a time to meet up next week.

Shawn Flynn  20:54

Okay, then what should the normal follow up be? Should the startup just start emailing rapidly? Or how does that dance work?

Max Shapiro  21:02

The way it works is the investor hasn’t expressed interest, I would follow up and say, great meeting you on pitch force last night, I was wondering if you might have 15 minutes and get some questions that I’d love to get answered from you based on your experience. Be quick, be direct, be persistent. I know someone who was very, very prominent with an angel organization. And she was notorious for not getting back to people. But if you got back to her two or three times and showed persistence that impressed her. And that’s, you know, it’s like I emailed her, she never got back to me, I guess she’s not interested. Now, the beauty of email today, and even texting, I mean, if you can text a person, rather than email them, you’re better off and the beauty today is famous, it will I don’t want to be too pushy. If you’re being too pushy, they’ll tell you, or after three or four times, if they’re not getting back to you, then obeah, one of my pet peeves is talking to people that say they’re interested in your services, and you had a really good rapport going. And then all I know, and then they change their mind. And I’ll reach out to them two or three times, and they never respond back. It’s stupid to go radio silent on somebody when it takes you less than 30 seconds. Hey, great talking to you, you know, we decided to move in another direction. Thanks for coming. That’s like you never know when you’re going to need somebody for something else. And if you don’t respond, if you’re not persistent, if you’re not polite, it comes back to bite you.

Shawn Flynn  22:24

What if I’m a startup at one of these pitch events, but I decide, hey, I want to go out to an angel group. Hey, Max, you’ve been involved in Keiretsu. And many of the angel groups here in Silicon Valley, everyone knows who you are, what’s the best way for a startup to get an angel groups attention.

Max Shapiro  22:40

Me, hopefully, there’s somebody in that group that they know. But if they don’t, then just go through the process. There are companies that get meetings in ANGEL groups without having a warm introduction to VCs that’s really hard to get into a VC without a warm introduction. But Angel groups, they’ve all got a procedure, they’ve got a process for companies raising their seed round, it’s not as hard to get into the angel groups, because everybody’s looking for deals. I mean, even during these COVID times people are looking to invest in they’re looking for good opportunities. And angels are not out there spending time, two and a half hours at pitch force if they weren’t interested in finding something that was gonna hopefully benefit them. And if they can invest in

Shawn Flynn  23:21

well, then I guess going from the investor side, I mean, spending two hours of Pitchfork, they learn a ton, but how does an investor get access to the best deals,

Max Shapiro  23:30

they like being part of a group because you’ve got the wisdom of the crowd. But the other thing is, you know, as to go to Angel list and see some of these groups and jump on the bandwagon groups that have been successful, and that are looking for other people. I mean, VCs do that to VCs will tag along, if Andreessen Horowitz is in the deal, I better get in the deal. There’s that I mean, again, do your research, there’s nothing wrong with a bandwagon approach. If the people that you say you want to invest alongside have a great track record, and you know them and they’re strong, they’re upright, they’re ethical.

Shawn Flynn  24:04

And then how does a, say a new investor, a new startup? How do they get in to these networks? How did they get to piggyback off Andreessen Horowitz or even go to an event that he’s at?

Max Shapiro  24:15

I think the best place to go to for that is Angel list. And with the angel groups, I’ve seen people that join Angel group, the caressing forum, Randy Williams, a guy that runs it says, I don’t want a new member investing for at least six months. Because you get really excited you invest in this one, that one, what you need to do is learn to see who the really smart people are in that group and who have a domain expertise. And if they’re investing something, you might want to do more due diligence on that and talk to that person. Why did you invest? That’s the beauty of groups of angel groups of having people with domain expertise. I mean, I’ve heard a lot of pitches, that sound great, nobody, one person that really understands that space, and they raise their hand and say, well, no to consider this and there’s competition here and there and all of a sudden, it’s like He is somebody who really understands the space might be a medical device company and you’ve got a doctor in the group that can really know what’s going on there. And sounds good to you, but defer to those people who are experienced and who have had success in investing in those areas.

Shawn Flynn  25:16

So going back to that way, in six months have joined a group to make your first investment, kind of what areas do you find new investors lacking? What knowledge are they just oblivious to?

Max Shapiro  25:28

Because it’s almost like they don’t know what they don’t know. They’ve got to be around for a while. I mean, if they don’t have domain expertise, they better find out from people who do why they like or don’t like a deal. They need to educate themselves. I mean, there’s a lot of opportunities to learn in the angel groups is a lot of materials and 15 things that angel investors should be looking for before they invest in investing in the smartest person in the room. Investing in someone who’s enthusiastic. Not someone who’s doing a pitch like this, and they’re putting it to sleep is like somebody said, well, you should cut that guy a break because English isn’t his first language. Hey, some of the greatest pitches. I’ve heard from people that English is not their first language. So that’s not an excuse. If you’re doing a four-minute pitch and you’re putting people asleep, how are you going to get people excited and busting their butt for 60 hours a week?

Shawn Flynn  26:14

Good point. What are some stories of companies that you’ve gotten to work with in the past?

Max Shapiro  26:19

Yeah, I mean, one of my favorites is a company called Boston heart labs and we took part of our be an equity and got a 10 x return on Boston hard labs. The CEO is a gentleman they Wolfgang down and is a German American, just a great guy got a citizenship when he sold his second company to Boston Scientific. Boston heart lab had about 20 extra blood tests for people that had weight issues and heart issues. And Wolfgang, very direct, he says, I want you to find me a VP of sales and the fat bell. I said, Wolfgang, what’s the fat goat? He’s German. I’m American. And I should know, I don’t know. Nobody knew what he said. Kentucky, Alabama, Mississippi, Georgia, Louisiana, where people are fat and they need more blood tests. We found him a VP of sales in Atlanta. And this was a headhunting thing. He was working for the competition. We found out the competition. We spoke to him and he loved Boston Hart labs, he went to work for them. And this is an area where we had no expertise. We didn’t have a database, but we use old fashioned headhunting and Wolfgang said that they got their big round of funding from Bain Capital. And Wolfgang said, without our VP of sales, without the VP of sales that he found for us, we never would have gotten Ruby round from Bain. So that was a good one. And like I said, we took part of our fees in equity. And that was a 10 x return. That was a nice one.

Shawn Flynn  27:31

How often should service providers or experts would you say, be open to taking part of their salary in equity?

Max Shapiro  27:39

It depends on their risk tolerance, their age, what it’s a challenge, it’s hard to pick winners, whether you’re an angel investor or a VC, if you look at a fund raised by VCs, and they invest in 10 companies and expect to exit in seven years, every one of those 10 companies they invested in, they thought they were gonna be big, not the next Google or Facebook, or Instagram with big and then maybe two of them making eight out of 10 that they were totally wrong on that didn’t go anywhere. It’s a hard thing to do. You know, I mean, the best thing for angel is to invest $25,000 in 30, or 40 deals and hope that one or two of them, hit it really big and cover all your losses rather than investing 100,000 in three or four companies.

Shawn Flynn  28:21

And then Max, can you share with our audience a little bit what you’re working on now.

Max Shapiro  28:25

People Connect is the most unique recruiting firm in the world because we got these employees without paychecks model and that’s about 20% of our practice the other 80% is finding people for any type of company anywhere in the US any position, I’ll give you an example recently filled in the cannabis space we’re doing searches there placed a VP of sales, a CEO and a financial analyst. And it’s three different people at three different levels proving that we feel many different types of positions for many different types of companies pitch force going online has just been a real boon for us because we’re able to have companies from all over the country all over the world and investors from all over the country all over the world and I love this it’s a lot better doing our pitch forces weekly online than it was in person to just walk into my office and do it so many people watching this is a lot easier a lot less expensive.

Shawn Flynn  29:13

Well I missed the free pizza so max if anyone wants to find out more information about you pitch bores people connect what’s the best way to go about doing it?

Max Shapiro  29:22

Just email me I’m the only guy I know with one email address max at people connect staffing dot calm or go to people connect staffing or pitch forces pitch dash force dot calm them in the interest, just shoot me an email love to talk to him.

Shawn Flynn  29:36

Fantastic. And Max, I got to thank you again for being a guest on the Silicon Valley podcast. And for all our listeners out there. please share, like write a review on iTunes that helps us get indexed and it encourages us to create great content like this. And everyone stay tuned for next week when we bring another Silicon Valley celebrity to your home. Alright, so once again, Max, thank you for being a guest on the Silicon Valley podcast.

Max Shapiro  29:59

Thanks, Shawn. I enjoyed it a lot.

Shawn Flynn  30:03

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