Gil Eyal. How Being a People Person Made Me Successful
Episode - 28
Gil Eyal. How Being a People Person Made Me Successful
Gil Eyal. Four years ago he sold HYPR - a software business which revolutionized the way big agencies and brands run influencer marketing.
Today, he invests in consumer startups. He has a unique focus - startups that can benefit from having a celebrity on their cap table.
In this episode, we discuss overcoming a post-exit identity crisis, building a personal brand and dealing with celebrities.
What We Discussed:
00:01:12: Greeting and introduction to Gil
00:01:50: Gil’s identity crisis post-company sale
00:03:00: Gil’s efforts to bounce back and the impact of COVID
00:03:46: Starting Stardust and finding new purpose
00:05:20: Balancing work and personal life
00:07:16: Gil’s investment approach and mentoring founders
00:07:58: Working with celebrities and influencers
00:09:32: Criteria for choosing investments
00:11:00: Personal motivation and work-life balance
00:14:11: Reflecting on the early and later years of Hyper
00:14:48: Thoughts on selling Hyper
00:16:00: Market challenges and investor relations
00:19:00: Sharp separation from the company
00:19:12: Introduction to the sale process
00:19:55: Transition from founder to investor
00:21:01: Skills and approach as a founder and investor
00:24:04: Advice for founders selling their company
00:26:33: Building your personal brand post-exit
00:30:25: Mentoring and investing in new founders
00:35:55: Personal life and relationships post-exit
00:37:24: Aspirations for the next generation
00:38:02: Discussing children's future careers
00:38:28: Transition into investing
00:39:04: Challenges of being an investor
00:41:13: Personal financial risk in investments
00:42:32: Purpose and desire for wealth
00:44:13: Advice for aspiring angel investors
00:46:09: Positive actions to take post-exit
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Gil Eyal: [00:00:00 - 00:00:06]
I literally sold and the next day didn't work for the company. So it was a very sharp separation.
Anastasia Koroleva: [00:00:06 - 00:00:30]
Gil Eyal. Four years ago, he sold Hyper, a software business which revolutionized the way big agencies and brands run influencer marketing. Today, Gil invests in consumer startups that can benefit from having a celebrity on their cap table. In this episode, we discuss overcoming a post exit identity crisis, building a personal brand, and dealing with celebrities.
Gil Eyal: [00:00:30 - 00:01:06]
Once you start investing, it's very hard to mentor without investing because everybody goes, wait, Gil's involved? But he didn't invest. What's wrong with your company? A lot of people who want to be angel investors end up doing one or two investments. It's a portfolio game, like, you have to do a lot of them to succeed. I see about 300 to 400 companies a year to invest in three to four. Why would anybody pay for influencers when you could just buy an ad? If you gave me cream that I could put on my head, grow a full head of hair, no chance you would believe me that works, right? Unless you saw the rock using it for six weeks and growing hair every day when you post.
Anastasia Koroleva: [00:01:12 - 00:01:16]
Hello, Gil. Very happy to see you here today. Thank you for joining me.
Gil Eyal: [00:01:17 - 00:01:18]
Hi, Anastasia. Thanks for having me.
Anastasia Koroleva: [00:01:18 - 00:02:00]
So, four years ago, you sold a software company which built software for influencer marketing firms. And that company took you seven years to build. And it made quite a lot of noise in the industry. Also, as part of that process, you personally built a celebrity name for yourself. You got all possible awards. You were called the new king of influencer marketing, and you hang out with the likes of Leonardo DiCaprio and Serena Williams. So my question is, when you sold that company, how did you feel in terms of your identity that you were no longer part of hyper?
Gil Eyal: [00:02:00 - 00:02:53]
You know, it was really hard because you genuinely become one with that company that you build. Like, people know you as the person who runs that company. And depending on the type of exit you have, it's not always. It wasn't a billion dollar sale where, okay, now I'm going to become Mark Cuban. Life changed, of course. For the first time in my life, I had some extra money in my bank account. I wasn't worried about paying bills the next month, but I was still going to be working. And there's a real identity crisis around it. It's almost like giving away your first born. Obviously not the same, but this is the company that I built. For seven years. It's all I did. It's the only thing I did other than take care of my family, and it's a. It's a real crisis. It was. It took me probably two years to bounce back.
Anastasia Koroleva: [00:02:53 - 00:03:00]
What did you do to bounce back? What was helpful and what maybe was not very helpful that you tried?
Gil Eyal: [00:03:00 - 00:04:29]
I am wired to do work, so I wasn't ready to go relax right away. So I immediately wanted to bounce back, find out what the next thing I'm doing is. But I got unlucky. I sold hyper in February of 2020. A month later, we were all home with COVID There was no hiring. Nobody was doing anything. When you sell a company, you do get a lot of offers, but the quality of the offers that you receive are part of what the market's looking like. If people aren't raising capital, if people are firing people, then you get different types of offers. I found myself doing a lot of consulting work, recognizing that a lot of other founders are going through the same identity challenges that I was going through and dealing with the same pain that I was dealing with. And that led me to start my own investment arm called Stardust, which initially was supposed to be with other partners. Now it's just my brother and I, but it allows me to be a mentor and help other people, and that's where I was able to kind of bounce back. Suddenly, I found new purpose. I wasn't building a company. I didn't have all the stress and the pain that comes with building a company. But I got to be around really talented, better founders than I was. Honestly, that could build bigger and better companies that have eventually become more successful than I was. But it allowed me to just find new purpose after you kind of are left with the carpet being pulled under your legs.
Anastasia Koroleva: [00:04:29 - 00:04:40]
So did it help you with your identity crisis? Because now you could say, I have this venture capital firm, right? So it probably felt good to say that.
Gil Eyal: [00:04:40 - 00:05:51]
Yeah. But, you know, my identity crisis wasn't about a title. It was more about purpose. Like, what should I be doing? You know, I was at the time, I was 42 years old, you know, supposed to have a midlife crisis around that time anyways. And, you know, where do you go? What do I do? I used to wake up at 07:00 a.m. put the kids to school and run to the office, and then be there till midnight and come back. And suddenly I have all this free time. Nothing's really that important. Like, you can only play so many video games. So you wake up, you still take the kids to school, and suddenly it's 830 in the morning and I have nothing to do. So for me. It was about surrounding. Sorry, it was about surrounding myself with interesting people. It was about waking up and jumping out of bed knowing that there's a reason for me to come. It wasn't really about, okay, am I still gonna win all these awards and am I still going to be considered? You kind of feel like the market keeps moving on without you. And new and smarter and more developed ideas come from other founders, and you can either choose to continue to compete with them and try to build something or do what I do, which is, hey, let me find people who can do better and help them do it.
Anastasia Koroleva: [00:05:51 - 00:06:01]
So you basically jump back into the activity to feel needed, to feel this purpose, as you said again, yeah, I needed drive.
Gil Eyal: [00:06:01 - 00:06:25]
I needed a reason to get excited about the day. And, you know, when you don't, when you have a company, it's too much of it. There's no. There's never an end in sight. The more that you can work all day long, you're not going to get close to what you need. So it allows you to find a better balance. But I needed to be close to founders. I needed to be close to innovation.
Anastasia Koroleva: [00:06:26 - 00:06:30]
So you got that freedom and you ran back away from it, back to work.
Gil Eyal: [00:06:30 - 00:06:58]
Yeah, but a much more controlled environment. I don't work usually I'll still answer emails and stuff like that in the afternoon, but I spend a lot more time with my kids now. I'm not tied down to the desk until midnight. Obviously, if a founder needs me, then we're there. It doesn't matter what time, doesn't matter if it's a weekend, but you have a lot more control, a lot more free time, and a much healthier balance.
Anastasia Koroleva: [00:06:58 - 00:07:03]
So how much you work per day and per week, you think so?
Gil Eyal: [00:07:03 - 00:07:57]
I work about, I'd say, 10 hours a day now. A lot of it has to do with my investors own a really big real estate company, and they asked me to come in and help them with some of the work there. So a lot of my time is spent there. I'd say about 75% of it. And then I do meet with founders at least five to ten times a week, either new founders or founders that we've invested in. The way that we do it is because of our experience with celebrities and influencers, is that we come on, invest, and then for the first three to six months, we work side by side with them to get as much exposure and more importantly, credibility through celebrity, new poster partnerships. And then we kind of take a step back. So I always have one or two companies that I'm working with aggressively. And then obviously if they pop up and say, hey, we need your help, we're in trouble, something happened. I just had a bad day. I need someone to talk to. Then sometimes that will last till midnight. But I don't really see it as work. It's my hobby,
Anastasia Koroleva: [00:07:59 - 00:08:22]
10 hours a day like you pretty much. So it sounds like you are leveraging that amazing network that you've built with hyper now in your new venture. Can you tell me a little bit more about how you choose those companies you invest in and help?
Gil Eyal: [00:08:22 - 00:11:13]
Yeah. When I was a founder, I used to think that investors are jerks. Either you would get either a maybe or a no, but never really a good explanation of why. And then when you start investing, you really have to think about what you're doing and who you're going to invest in. And I realized I'm not going to compete with Andreessen Horowitz or the best deals. They're not going to come to me. But there are spaces where I can be a mini version of that, where the value that I can bring would be enough for the best companies to want to work with me and the best founders. Where that really came to play is companies that have an amazing product, so amazing that you probably wouldn't believe would work, because it's too good to be true. And it sells to a consumer that could be convinced and influenced by the types of people that I've worked with before, which are either influencers or celebrities, where it makes sense. And so what we look for, ideally, is a consumer company, often CPG, but also consumer tech, where if I told you, hey, I have this product, you'd be skeptical. That's the beginning, right? Because, so the example I always give is if you gave me cream that I could put on my head, grow a full head of hair, no chance you would believe me. That works, right? Unless you saw the rock using it for six weeks and growing hair every day when you post it. So we're looking. That's the ideal company. If you're out there, call me. We're going to do big things together. But we look for companies. We look for companies where that's the story, where that's being able to do. And then we say, okay, let me see if I can pitch the company back a plan and say, hey, if you bring me on board, here's what I'd want to do. I'd want to bring this celebrity, and then I'd want to go to this retailer, and that would require you to offer the celebrity compensation because they won't do it for free. Are you willing to do this path? And if they do, and we love the product, and more importantly, we love the founder, we have to love the founder, then we think about it as a viable investment. The result is that there are plenty of amazing companies that we pass on that just because we don't have the right value for them. A great example of that is a company called Deal D e L. We were one of the first. I've known the founder for many, many years. He's offered me an opportunity to invest. And I said, look, I don't know, the space, obviously worth $12 billion now or something like that would have been nice had we invested. But I can't look at it that way. I have to focus as an investor. What we do try to do is be very direct with the founders and tell them the truth. Why didn't we invest if it's really because it's just not a good fit for us, or do we think there's some flaw in the pitch? Maybe the market's not big enough. Maybe there's better competition that we've seen out there, things like that.
Anastasia Koroleva: [00:11:13 - 00:11:32]
Fascinating. So let's go back to you personally, your motivation to work. And as you said, you work 10 hours a day and you're happy to do that. How did your motivation change from the time when you just started at Hyperdez and today, what's driving you ?
Gil Eyal: [00:11:32 - 00:14:48]
So, you know, I started hyper. I was really no one, you know, no one knew me. I had a pretty good education. I didn't come from a lot of money, but very loving and warm family and supportive family. And, you know, my brother was a successful private equity manager, and my younger brother worked for big Tech, intel, and then Apple. So a lot of disappointment to fail or not fail. Not a person who generally loves stress. But when I was working before that, I got exposed to some celebrity work, and I realized the impact that the then nascent influencer marketing space would have on digital marketing. So I felt like I really needed to do something in that space and thought that maybe I could make a lot of money. But I knew that it would take a long time for me to make a lot of money. What really drove me was to build my own reputation. That's my recommendation to every single person, whether you're a founder or not, is think about yourself as a brand, your personal brand. And how do you get to the point where people think of you as the authority figure about something and it doesn't matter if you're starting a company or if you're just working at a big organization, if you want to be promoted, if you want to get bonuses, then you need to be the recognized expert about something. You want to be the person that we can deal without. So I was very driven to try to build myself into that person, and I thought I had an opportunity because it combined a few things. One, it was an up and coming market where the old guard wasn't really excited about. People who are doing digital marketing really dismissed it at the time. They thought, why would anybody pay for influencers when you could just buy an ad? And I've heard that sentenced so many times back in the day. So I felt like there was a big opportunity for a market that was going to be really, really big. The current active players are dismissing so I could carve myself out a spot in it. And I also was kind of attracted to this idea that maybe I would get to know interesting people, and the type of people would be attracted to this industry are the type of people that I want to work with. So I got into this space and started iterating because it probably took me five or six versions of the product before anyone was willing to pay for it. But what I found was that once I found a product that people were excited about, they were really excited about it, and so it became fun. The first few years were just fun. I felt like I was on this project that was kind of had the legs of its own legs. People were excited to meet me. You know, I'd always been trying to get meetings. Suddenly, people were asking to meet me. I was being asked to speak. So once I got some confirmation that, wait, I might be on to something, it was very fun for many years, until the later years, which we'll talk about, which became much, much harder. But the first two years were literally the best job anyone can ask for with the greatest people. And in a space that was just tons of fun to work in.
Anastasia Koroleva: [00:14:48 - 00:14:51]
Are you happy you sold, or do you ever regret?
Gil Eyal: [00:14:51 - 00:16:43]
I wish I had sold a year or two before. We can talk about it a little bit. But the market had shifted on us. We recognized the market shifts pretty early because we were a data driven company. But not all of our investors agreed to sell. We did have some offers that were higher, so I wish we had taken them. You know, sometimes you get. You need luck. So we got lucky that we sold before COVID because we probably wouldn't have even sold maybe a few months later. But had we sold a year or two earlier, I think we had all done a lot better, but hindsight is 20:20 a.m. i. Happy I sold. Yes, 100%. I think by that point, I was fed up. The market had changed. We clearly recognized that the market was going to become a lot more difficult. Social networks who had previously dismissed this market couldn't really care about who's doing it, recognized that this was taking a chunk out of their revenue stream and started implementing different algorithms and doing everything they could to make our lives miserable, to make it harder for people to work. An example is a big social network. We won't say the name, but I'm sure people will guess. Called me up and said, hey, we suspect that you're doing something improper, so just know that we're considering suing you. And I said, what do you think I'm doing? I said, well, we can't really tell you. And I said, well, you're going to write me a letter. No, just know this. Now go raise capital. When a very, very well known guess which one, one of the biggest social networks in the world just called you, and you have to, of course you're going to disclose it to any future investor, because you're not going to raise capital and get a lawsuit a week later. Of course, they never sued us. They never called us again, but good luck. So the market was starting to take a shift. The big players are doing everything they can to make our lives miserable. And the result was that I wanted out. So I didn't regret it, even though it came with a lot of separation anxiety.
Anastasia Koroleva: [00:16:43 - 00:16:54]
Yeah, the separation anxiety is very common in our post exit founder community, as you know. So how did you achieve that closure? How did you move on?
Gil Eyal: [00:16:55 - 00:19:07]
It was really difficult, because what happens when you sell a company for not $3 billion is that even investors have made some money or gained some. Some of them are happy, some of them are upset. And I had a whole. By that point, we'd raised 20 something million dollars, and we had co founders and employees and everyone to take care of. And you never know. Like every single person that you tell it, some of them are ecstatic. Some of them are don't care, and some of them are mad because they thought you're their ticket to God knows where. A lot of it had to do with dealing with relationships and finding out who really was there for me and who wasn't. And not to say that I was perfect, but I did my best to get the best outcome for everyone. And so a lot of the investors were amazing and supportive and happy. With the results. And I and others were awful, anywhere from just bad mouthing you behind your back for selling the company when they thought you shouldn't have sold the company and different things like that. So a lot of it had to do. I think it was probably a year of just kind of staying out of the light, talking to people, you know, having conversations, some of them really unpleasant conversations with people that. People who maybe invested $25,000 but felt like they weren't including, included in the decision to sell. And often or not often, but some very aggressive. So it's a tough situation, and some people might have thicker skin, but for me, I really needed. It wasn't a breakup where, like, one day I sold the company and I was gone. It was more like, okay, I. You know, there's. There's a whole waterfall that is coming after this, and I have to deal with every single component of it. It was also interesting because often when you sell a company, they ask you to stay on. We had merged with a competitor and then sold, so their competitor, really, their competitor CEO, really wanted to stay on. And it was a perfect scenario because, as I said, I was fed up. So I literally sold, and the next day didn't work for the company, you know, so it was a very sharp separation.
Anastasia Koroleva: [00:19:07 - 00:19:10]
Okay. Did you keep any financial interest in.
Gil Eyal: [00:19:11 - 00:19:34]
Yeah, I still do. We'll go. You know, I still own. The sale had, you know, was broken down into our cash part equity. And as you mentioned earlier, you know, the acquirer who was supposed to go public soon after. But the markets, obviously, Covid and everything, the market's making it difficult, is now supposed to go public. So it would be nice if that goes well. But we'll see.
Anastasia Koroleva: [00:19:34 - 00:19:38]
You'll have a good outcome. So you're happy you kept a bit of your accuracy?
Gil Eyal: [00:19:38 - 00:20:02]
Yeah. No, look, I still like the company, so a lot of the people still work. There is a great place to work, I think, and it would be nice to have a happy, even happier ending for everyone involved, because everyone will get some more cash. Personally, I've been a lot more successful as an investor than as a founder, meaning that I've made a lot more money on other people's exits.
Anastasia Koroleva: [00:20:02 - 00:20:09]
As part of your venture investing after you exit, or you're talking about your investments even before you exited?
Gil Eyal: [00:20:09 - 00:20:40]
No, now that I do my own investments afterwards, some of those companies have grown to be unicorns and done much better than our sale. So instead of tens of millions, we're talking about billions in sales. And so it's just compounded as an investor, I found that I have done better, and I think they're. I may end up being a founder again, but I think version one of Gil is a founder. Looking back, there's a lot of things I could do better because I'm learning from the founders that I invest in today.
Anastasia Koroleva: [00:20:40 - 00:20:59]
So for many of us, it's actually very hard to transition from a founder into an investor, just psychologically, because what's required for a founder is so different than what's required from an investor in terms of personality. So what's your take on that?
Gil Eyal: [00:20:59 - 00:22:53]
I don't think I was a regular founder, ever. I was very much a people person. Like, I built an amazing team around me. People wanted to work with me. With all modesty. We consistently would check if people are happy. We never had people leave the company. People only wanted to join. And we built something that I felt was very special for everyone involved. But it allowed me to attract people that were really, really good at what they did. So I think that component is a really good fit as an investor, too. People want me on their board, people, I think, a very supportive investor. So a lot of those qualities kind of transform. If you're the type of founder that's a very diligent CEO that needs to know everything that's going on, that micromanages the company, that was never me. And those qualities create really, really good founders. They're not the only qualities that create really, really good founders, but they're often seen really good founders. For me, I think my personality was always a good fit for someone who's an advisor or an investor. And I think a lot of the founders that we work with feel like they get a lot of value simply. But from the fact that I tend to analyze and understand what's going on and kind of give them a clear vision when often, you know, you get tunnel vision when you're a founder. And that's what I did for my company. You know, I had an amazing CFO, I had an amazing marketing person, I had an amazing CEO. And those guys, I let them do their work and just kind of helped whenever it was time to notice. Oh, wait, you kind of missed something, or there's something else you should look at. I was the type of founder that I think easily transitioned into this position, but there's a variety, and I don't think I was the best founder. You know, I think there were better. Not that it was bad, but there are definitely better founders out there, and I'm finding that out every day.
Anastasia Koroleva: [00:22:53 - 00:22:58]
So basically, it was your people skills that made you a successful investor.
Gil Eyal: [00:22:58 - 00:23:58]
It's a combination of people skills. And I have this ability to kind of envision, kind of build out where I think the challenge is, where the strengths are and kind of really quickly analyze and understand strengths and weaknesses. It's kind of like a swot analysis in the head. And then one other thing is, I just have. Some people have different gifts. My gift is I have a positive approach, meaning it's very hard to convince me there's no way to solve something. And I usually come out with a creative way around a problem or to solve it. And I think, one, people like to be around that. And two, I think it's very effective often. So, as a founder, you're constantly bumping into walls, and it could be very, very disappointing, very depressing, and you can lose faith. But for me, for some reason, in life, in business, I always see a way to move forward.
Anastasia Koroleva: [00:23:58 - 00:24:04]
If you're talking to someone who is just selling their company, what would you tell them not to do?
Gil Eyal: [00:24:04 - 00:25:41]
That's a great question. Well, I think the number one piece of advice for me is that to understand whether it means to be humble or to be less judgmental of yourself, to understand that you're only part of the equation, what you sold your company for, whether or not you failed or succeeded as a founder, a lot of it has to do with luck. A lot of it has to do with decisions that were made with limited information. So if this sale is amazing, you know, stay humble. If the sale is just okay, don't be too hard on yourself. And if you didn't sell or, you know, it was a bad ending, you know, take some time, pick yourself up, recognize what you did right, and figure out how you build again. And then that's one piece of advice. The other one is, you know, think about everybody who is with you on this journey, and how do you make sure that you don't leave behind people that were unfairly treated? So, you know, we all know about options. We all know about equity. And the result often is that people end up, when it's time to sell a company, end up realizing that they own a lot less than they thought they did. They got diluted. They didn't realize how much stock they actually had, all these things. So if you haven't been transparent until now, which you should be, was my advice. But if you haven't, make sure you have these conversations. At the very least, let them know that it matters to you that you care. But more importantly, do what you can to make sure everyone got what they put into this company.
Anastasia Koroleva: [00:25:41 - 00:25:48]
I'm sure these were not very easy conversations for you, and you said it took you a year to deal with all of them.
Gil Eyal: [00:25:48 - 00:25:56]
It was interesting for us because we were kind of in between. People made money, but it wasn't the dream money that a lot of people had hoped.
Anastasia Koroleva: [00:25:56 - 00:25:56]
Yeah.
Gil Eyal: [00:25:57 - 00:26:33]
So maybe two, three, x of what they put in. But the reaction was very different. Some people were ecstatic, some people were furious. And, you know, I'm the type of guy who really cares when somebody's really mad at them. So it was very difficult to deal with. But at some point you have to tell yourself, look, I've done everything I can to get the most out of this company and to be as fair as I can to everyone involved. And if they, you know, if somebody doesn't appreciate that or is still angry, then at some point you have to let yourself off the hook.
Anastasia Koroleva: [00:26:33 - 00:26:43]
So you mentioned that you were very intentional about building your personal brand as an expert in your field. Are you continuing to do that now?
Gil Eyal: [00:26:43 - 00:26:43]
I think so.
Anastasia Koroleva: [00:26:43 - 00:26:47]
Is it part of your personal strategy now, after you're sold?
Gil Eyal: [00:26:47 - 00:27:33]
I think we should all be doing it all the time. Doesn't matter. Again, if you're just on your first job or, you know, if you're an intern with eleven other interns, you need to be known for something. You need to be, because nobody will remember you otherwise. But you need to be known as a guy who really understands excel or the one who's really funny or the one who has great marketing ideas. You have to stand out. So do I work at it full time like I did as a founder? No, I had a pr team. We did everything we can to get attention. I don't have the resources and the time to do it now. Do I do everything I can to stand out? That's why Stardust operates differently than other VC's. That's why we bring on board the celebrities. Yes. I think you should always be doing it, and I do my best to always be doing it.
Anastasia Koroleva: [00:27:33 - 00:28:13]
So, for example, someone sold a company and they're going through the identity crisis and they did not have your story. When you already intentionally focused on your personal brand for a while, they're just thinking, you know what, I really want the world to know what I've done. But at the same time, I do appreciate that a lot of it was luck, and I don't want to look like I'm bragging. So what would your advice be for a person like this, in terms of let's start with the mindset. What would the right mindset, the healthy approach to building your personal brand post exit would be?
Gil Eyal: [00:28:14 - 00:30:25]
Yeah, I think number one is like, what we're doing right now. You know, speak to other founders, people who've gone through a similar process. Start not on camera, you know, so I've had a lot of these conversations, just one on one. And, you know, what should we do? What do we want to do? And what you find is that people have a very broad reaction to it. There are people who want complete, want to jump right back into it. They're already ready to start their next thing. And there are people who need a lot of time off. So find out who you are first. The only time you have that's a break. Not to be building your brand is when you're still exploring what that brand is like. Who do I want to be? And once you do, think about where does that mean I'll be in five years? And how do I get there? So if I, in five years, I want to be known for 1234. What do I need to do to get to that place and treat yourself as the brand that your startup had? You know, most of us, even if it was an enterprise, SaaS, we built a brand for our companies, and that brand was known for certain things. So now think about yourself as that brand. Okay. So I know that I'm really, really good at one, two, three, not so good at four or five, so I'm not going to bother with that. But one, two, three, where can I be that creates a real impact and helps me become known for what I'm doing. One and two is what kind of activities can I put out that demonstrate to people that that's what I'm doing? So it's anywhere from, you know, hosting your own podcast to just writing on LinkedIn or on other social networks to joining groups of other founder, former founders. Like, you know, that's where we met. And then what I did, which I think is a really, really recommendation for anyone who's sold a company, just find a few founders that are getting started and work with them. Go through the entire experience through someone else's eyes, without the stress, without the burden of making the final decision, and then, like, evaluate yourself and say, okay, wow, you know, I thought I was really good at this, but I'm looking at another person, and you know what? They're better equipped to do it. Maybe it's something else, but really understand what that brand is before you start building it.
Anastasia Koroleva: [00:30:25 - 00:30:34]
So I know you've done some mentoring. Also, in addition to investing into companies, what did it give you? Was it a good idea? Was it a waste of time for you personally?
Gil Eyal: [00:30:34 - 00:33:45]
So in full honesty, some of times it's amazing. Sometimes it's a complete waste of time. A lot of it has to do with who's on the other side and whether or not they want to listen. I am notoriously known for starting my emails with, hey, I'm wrong all the time, so take this with a grain of salt. I just sent one right now and then, kind of giving them tough love. So I just met with a founder this morning that pitched me on an investment. Loved the founder, but the product itself is just a small market. And I wrote her an email afterwards saying, look, I really liked you, I really liked the product, but it's a luxury item in a small market. That means that, you know, I'm going through McKinsey style exercises that can get to $50 million market cap. You know, that's where you're going to end up. And that means you're not going to be able to raise capital from really big vc's in the next round. And it means that because you didn't raise capital from the big VC rounds, you're not going to have a lot of money to market. And that's just summarized the email pretty much. And I said, and like, I'm really excited about you. I want to invest in you, but I can't invest if I, you know, if I know that my money is going to be the last money in the company because I'm small player. And then I was very tempted to say to her, so I think you should dump this product and start a new company. But I didn't say that. I said, I am here for whatever you decide. Here are some ideas. You could go after a new product. You could convince me that there's a bigger audience than I think for this product, maybe take it off the luxury market and go into a larger place. Let me know what you want to do. But the one thing I really avoided was to say, and then I'll decide. But I said, but for now, it's a no. And I think one of the things that a lot of mentors, a lot of investors will say is I'll decide later or let me know what's happening. They're hoping that things will work out. I say no because I don't want them to change their idea because they want me to join or because they want my money. I want, I say no and I say well, if something else happens, let me know. And I know it's kind of counterintuitive because you want to stay in the game, and if suddenly a big vc invests, of course you don't want to be left out. But that's, that's how I do it. And I think it's. It's rewarding, because what's happened when I've done that a lot now is often they'll not, they won't change, and they'll stay. And, you know, maybe I'm wrong. Maybe I'm right. Does it doesn't really matter. I mean, it matters, obviously, if I'm wrong, and they do really well, it's a bummer, but I'm happy for them. It's a bummer for me. But every once in a while, they'll come back to you and maybe a week later and maybe two years later and say, hey, we've shifted. You know, and maybe it's. Maybe we've listened to your advice and we've listened to other people's advice, but you see progress that they've made, and those are the people you really want to invest in. You can see that they make. So, as a mentor, and again, I'm wrong all the time, but if I am seeing them listen to advice, accept it, and have a better product as a result or better access to the market or better marketing plan, that's really rewarding, especially if you own part of the company. But even if not.
Anastasia Koroleva: [00:33:45 - 00:34:24]
So it sounds like you've done some mentoring outside of your venture investing, but now you're also doing it as part of your venture investing because you invest in. In pretty early stage companies, don't you? Okay, so, for you, what is more rewarding when you are mentoring as part of investing or without money involved? I'm just thinking for someone who is considering different options of what to do after they exit, which way you think they should lean towards.
Gil Eyal: [00:34:24 - 00:35:52]
So, you know, the interesting thing is I found that once you start investing, it's very hard to mentor without investing because everybody goes, wait, Gil's involved that he didn't invest? What's wrong with your company? Right? What does he know that we don't know? And often the reason I don't invest has nothing to do with that. The reason is because I can only write a $50,000 check and you need 4 million. So I'll invest, maybe when there's a round. What I don't do is just mentor and say, hey, I'm not interested in investing, but let me mentor you for that exact signal. But if I plan on, if I'm really excited about the founder, really excited about the company, and there's no round happening right now, I'll promise them and keep that promise that I will invest as soon as there's a round so that we can kind of circumvent that question of, wait, why didn't Gil invest? I think it's a win win for everyone. One they can go around and say, hey, Gil's committed to invest. I can say to people, hey, I'm really excited about this company and I'm going to invest. So you should or not that you should, but I would recommend that you think about it as well. And if the company, if I write and the company does well, I actually own a meaningful or not meaningful, but at least I own some of it. So my style has been, if I really, if I, if I'm not going to invest, I probably will not also mentor at that point.
Anastasia Koroleva: [00:35:52 - 00:36:02]
Which makes a lot of sense for you, for sure. So your exit, how did it affect your family and your relationships with your nearest, closest people?
Gil Eyal: [00:36:02 - 00:37:24]
Well, it didn't cause it, but I was going through a divorce, an amicable divorce at the time, and we're still in a very good relationship, but we weren't a good fit for each other. And I don't think it was driven by the sale, but I think the sale made it easier because at least there was some stuff to split up, and we were very close. So we just cut everything in half and we get along really well. I think it was really good for my kids. My kids barely saw me. I would see them in the morning. By the time I'd get home, they were asleep most of the time. I'd see them for a little bit in the weekend, but I was working throughout the weekend. I was like, okay, we'll go out for 2 hours, and I need to go get back to work. I was working all the time. Now I spend a ton of time with my kids. I work almost entirely from home, so I'm always there when they're here. If they're at their mom's, then obviously no. But when they're here, I'm always there for them. I can drive them around. I pick them up from school. I go to all the school events. I'm the dad with. It's mostly moms, but I'm the dad who shows up to serve pizza on Friday morning for the Friday lunch for the kids. So I think it's been great. I'm really getting an opportunity to spend a lot more time with my kids. They're eight and twelve now, so I've just been, I've been happier. I think they've been up here. I get to embarrass them every once in a while. It's great.
Anastasia Koroleva: [00:37:24 - 00:37:27]
Would you like your kids to be entrepreneurs when they grow up?
Gil Eyal: [00:37:27 - 00:38:27]
Wow, that's a great question. Having thought about it, I think when I was younger, we were always taught that we need to find a serious job and that we need to make a great living. And the generation above mine, you know, was all about keeping one role, keeping that one job. And there are certain people who can be happy that way. I was not. I started my career working in that, in that type of environment left and people thought it was crazy to go to business school and then start my own company. But I found what made me happy. So to answer your question, if that's what would make them happy. Yes. I don't think, you know, they're still young, but I don't think that would fit both of them. I think my older son is a creative type. He doesn't like high stress environments. He'd probably do better somewhere else. I think my daughter could be a real astounder that she's only eight, so wealthy. Whatever makes them happy if they want to. Great.
Anastasia Koroleva: [00:38:28 - 00:38:31]
So do you see yourself as an investor in the foreseeable future?
Gil Eyal: [00:38:32 - 00:39:25]
Yes. I think what's happened to me is I made some money off the sale, invested a small part of it. We did pretty well. Instead of 25 investments, probably we have three or four unicorns, and then we have probably ten or 15 others that still have a shot. So we'll see what happens. And we did pretty well, but it takes time to get liquid with these deals. So on paper, we've made a very, very successful effort, but we haven't seen a lot. 90% of it hasn't come back yet. As that comes back, I would want to start writing bigger checks, but in a perfect world, at five years from now, I have $100 billion fund and I invest much larger checks and don't need to chase other investors to join me in the round, but kind of just do it myself. Yeah.
Anastasia Koroleva: [00:39:27 - 00:39:29]
So what part of the job you don't like?
Gil Eyal: [00:39:29 - 00:41:13]
One. The hardest part is saying no. I always, as a child, I remember thinking I was really, really jealous of the extremely beautiful people. We all know one or two of those people that they walk into a room and they're like, oh, they're so beautiful. And I had a like, as I got older. I had a friend who was one of those people. It became his friend. And he said to me one time, something that really struck, struck me, which is like, he said, you know, you're my only friend. And I said, what does that mean? He's like, I don't know. Guys don't want to be friends with me. And, you know, because the girls around and women, you know, they only want to date me. They don't want to. No one wants to be friends with me. And I, and I said, so what's the hardest part? And he said, well, people are always hurt. Women are always hurt when I'm not interested. And it seemed at the time, very, very, like, I was like, ugh, that's kind of, like, icky. Don't say that to people. But as an investor, you're kind of the prettiest person in the room, right? Like, people reach out to you. And that part I love, because, you know, I'm not, I'm not a huge extrovert. Like, I'm not the type of person just gonna reach out to people all day long, but you have to say no all the time. That's really hard. Like, it breaks my heart sometimes. Like, this founder we talked about this morning, she's amazing, and I know she's good. I don't know if she's going to take my no. The way that it's meant, which is, look, I would love to invest in you, but the product needs to be targeted, larger audience. I think she might, because I used to, as a founder, just take it personally and say, like, oh, I guess, you know, that's all, you know, investors speak for, you're not good enough, and that's not the case. But you're consistently drafting these emails where you explain to people why it's a no. And you know that even if you're as gentle as possible, you're hurting their feelings. And that part I really dislike.
Anastasia Koroleva: [00:41:13 - 00:41:25]
So how much risk are you taking personally in these investments? Like, are you using most of your money to angel invest, or is it just a small portion?
Gil Eyal: [00:41:25 - 00:42:30]
So my brother and I do all of our investments together. So it's always 50 50, I would say, about. So, you know, we all have piles of money, right? We have what I need to pay the bills and all that stuff I don't touch. Then I have some solidified investments in stock and stuff like that. But then there's a pretty, for a person, like a pretty meaningful pal that I invest, it's probably like ten to 15% of my income. Goes into investments. So pretty significant considering I come in very early, very high risk. But what we found was just based on what we've done so far is that even though it's considered high risk, if you bring on board, if you have a really, really good plan, then we're definitely doing better than one in ten, which is the number of people throw out for startups. It hurts when you lose, but it's the kind of excitement that I want to have in my life. I'm willing to pay that price, even if it is risking a pretty meaningful chunk.
Anastasia Koroleva: [00:42:30 - 00:42:30]
Yeah.
Gil Eyal: [00:42:30 - 00:42:32]
Of my net worth.
Anastasia Koroleva: [00:42:32 - 00:42:39]
So you are doing it primarily not for money, you're doing it because that gives your life purpose, as you said.
Gil Eyal: [00:42:39 - 00:43:11]
I don't know if I would say that I do want to be a billionaire someday. I'm still a very, very, very long way from there. But yes, no, if there was no money involved, I'd probably have to find something else. I do have a responsibility for the next generations and my family, and as I mentioned, my first exit, it set me up, but it didn't really, it was not a retirement type style exit. So, yeah, I think when I get called to be on Shark Tank, then I'll know that I've made enough.
Anastasia Koroleva: [00:43:11 - 00:43:31]
So you clearly have some very specific value to bring into all these companies with your backgrounds, with your connections with influencers and celebrities. But for someone who doesn't have that, do you think angel investing is a good investments from purely rational financial standpoint?
Gil Eyal: [00:43:31 - 00:46:09]
I don't think so. I think that if you're not an expert in the area that you're investing in, you will not do well. I see about 300 to 400 companies a year to invest in three to four, and it's not. And the reason why we've been successful is because we really, really know the space we invest in. We can create value immediately. We can get them into retailers, we can get them partnerships with technology partners, we can get celebrities on board. I try to look back at how companies did, and generally speaking, I think the one in ten number is very optimistic. Usually the startups, you'll find if you're not very well connected, you don't have really, really good relationships or a reputation. Where the best companies will come to you are the ones that are not going to be successful. So you'll do a lot worse than one in ten. So generally I would say just be an angel investor. No, what you can do is you can partner with people that do know what they do. Either join an angel group that has people from the industry to his focus in spaces that you know something about. You don't have to. Maybe you made money working for a big CPG company. Great. So join an angel group that focuses on CPG. You don't have to choose the companies, but surround yourself with people that know what they're doing. That's one thing I would say is, you know, definitely do it. The other thing I would say is, a lot of people who want to be angel investors end up doing one or two investments. It's a portfolio game, like, you have to do a lot of them to succeed. And that means that if you're just going to the market without having a reputation, you're not going to see nearly enough companies to invest in the. You have to join one of these groups, you have to participate. You have to be willing to take some risks and assume you're going to lose some money in the learning curve. So my advice is, no, don't start being an angel investor out of nowhere. Join a group. Don't invest in the first three deals that you see. Just sit there, listen to how people are thinking about it. Think about what you would do, and then look back three months later and say, should I have invested in this company or not? And then write your first check alongside a group like that. When you see the best companies, you're like, wow, these guys are so much better than everyone we've seen so far. Then you could write your first check. One exception I have is if you're very, very wealthy and VC's will let you join in on their rounds, you can become a very successful angel investor simply by building relationships with really good vc's and saying, hey, whenever there's $200,000 that you need, let me know. I'm not in a position to write $200,000 checks, but that's what I would do in that scenario.
Anastasia Koroleva: [00:46:09 - 00:46:19]
Brilliant. So I asked you before what not to do after an exit. Was there anything that you would tell people, do this, this was great. I'm happy I did it.
Gil Eyal: [00:46:19 - 00:48:47]
Yeah. First of all, join the group that we're in. That was an amazing experience. So we met through this group of post exit founders, and I met in the, I just joined like two or three months ago, and I've met probably 30 or 40 amazing people that gave me perspective on the, on what they're doing, what I'm doing. It's amazing how everybody takes this process differently, but yeah, join, surround yourself with people who've gone through that process. Number one. Two, within the people that surrounded your startup, there probably were one or two investors or mentors or advisory board members that meant a lot to you. That did really well for you. Make sure that isn't the end of that relationship. You know, stay in touch with them. You know, for me, I had a guy named Charlie Federman, another guy named Larry Wagenberg, who were, who are part of this program that we started with that ended up close to me till this day. But for the seven years that we ran the company, they were my closest advisors and supporters, and we're still in touch. And if I ever start something, they'll be the first phone call I make. But, yeah, so keep in touch with those people. That really matter, too, is within your team. There are probably a few standouts. If someday you want to do something or you're going to help somebody else do something, make sure you keep those relationships, because those are the people that you'll immediately think about. Who do I want to bring into this project? And you'll be at an unfair advantage because you already know a few people that could do way better than the average person. And then three is like, force yourself to change your lifestyle. Like this idea that you have to work all the time, that you can't go to sleep knowing that there's an email in your inbox. Take it out of your head, you know, force yourself to go on vacation. I hadn't gone on vacation. The seven years I had hyper. I hadn't gone on one day of vacation. One day I was working on planes, I went to visit family I was working for. I was like, is there a setup for me to work? It's not healthy. It's not good. So force yourself to take some time off. Let your brain take some time off. Find out what you like that isn't working and do it. Whether it's playing sports or watching sports or video games or going to parties. I'm going tonight. I'm going to. I paid $70 to go listen to Scott Galloway, professor Scott Galloway talk about his new book. I don't know. You know, it's what brings me happiness.
Anastasia Koroleva: [00:48:47 - 00:48:58]
Amazing you. Thank you so much. There was so much wisdom, and you opened up so beautifully. I really, really enjoyed our time together. Thank you so much.
Gil Eyal: [00:48:58 - 00:48:59]
Me too. Thank you so much for having me.
