Founder Focus

And we're live! Hello everyone, I'm your host Jade Wang and welcome to another episode of Founder Focus. Today I'm joined by our guest Melissa Kargiannakis, founder of SpiritSwap. Thank you for joining our show. Thank you so much for having me, it's so exciting to spend time with you today. Thank you and before we get started I wanted to let our audience know that you can call in with your questions for Melissa. You can email in or call in and this information is also down below. So feel free to ask her and I will find time for those questions at the end of the episode. So very briefly, just as a primer for those of those in the audience who don't know what SpiritSwap is, can you give us a brief primer on what the company does? Yeah, absolutely. So SpiritSwap is an artificial intelligence technology startup and what we do is we take complicated information and we make it really clear. So if you imagine Google Translate, but when you click the SpiritSwap button it can take a really complicated legal agreement, employment agreement, mortgage, and turn it from that complicated legalese into a grade five, grade six reading level. Much easier to read. That's fantastic. I mean the moment you say words like legal documents and mortgages and contracts, there's just this ug field that I feel sometimes. Just the notion of those documents, even though I'm capable of reading them, there's just something that's anxiety producing that causes me to procrastinate when tasks involve those kinds of things. Is this a universal phenomenon? I mean, absolutely. I've interviewed even contracts managers at major corporations, including with tech companies like Apple and Amazon and aviation companies like Boeing and Airbus, even Entertainment Disney, and people whose jobs are contracts managers. Even they're just like, all right, I gotta read another contract. Here we go. It's not fun for anyone at all, at any time, and even less the layperson in general, like me and the public going out, not even for work, but for my own personal needs, getting a mortgage, getting a car, figuring all that. It's just your eyes glaze over and it's rough for everyone. Yeah, I imagine. Do you primarily sell to businesses or to consumers as a product? Right now, AI and machine learning, they're complicated tools to build and expensive in the early days. So right now we sell to businesses in the hopes that one day we can have at least some version of our product available for the public, because that's really where my heart is. But right now we need the income from those big customers to make the product even better. Yeah, I imagine this must have some impact on customer conversion when businesses use it for their documents. Can you tell us a little bit about that? Absolutely. When you simplify the language in your contracts, so it's just simplified language, they're still legally sound as approved by your general counsel. They're still legally binding. They're just clearer and easier to read. You close contracts 60% faster. That's not just what we've seen with our customers. That's also data from international research. So clearer contracts close 60% faster. 60% faster, that's money in the bank. It is. You're looking at those sales lagging into the next quarter and you're bumping that right up into this quarter, which is really important for businesses. Yeah, that's amazing. Let's talk about the case for readability in general. A lot of our viewers work in the web development field. A lot of them are in web design. Often this is advice of imagine your user is drunk when using your website. You want the buttons to be really obvious. You want them to be easy to find. But at the same time, one could easily, in my personal opinion, just as easily say, imagine your user is under the time pressure of a deadline. They're checking out your website for just a few minutes before they go to their next meeting and trying to figure this thing out. If they don't have it figured out by the next meeting, they might procrastinate and they might forget. Is the web design accessibility and readability in the same bucket here? Of course. When you talk about people going to websites for a few minutes, actually the average amount of time that someone will spend on your website is 15 seconds. So if they cannot find the information and understand it and then use it within 15 seconds, you've lost them. So that's the average amount of time. It's even less than a few minutes. And plain language is the field within which we operate. It's a very specific field. Plain language, you probably haven't heard of it before. I'm sure many developers haven't either. But it really does fall within the realm of UX and UI and accessibility, certainly, but also the user experience and user design. I really see plain language as a component to all of that. We thought about the design right down to, like you were alluding to, button size, button color, where you put it. But have you actually looked at the copy beyond just what is cute and marketing and like, ooh, let's use these buzzwords? Have you actually looked at, is this understandable? Like, sure, you could maybe read it, but do you actually understand what it's saying? And that's a deeper level. And I really do see plain language as being a component of UI, UX, of accessibility as well. That's fantastic. Can you tell us a little bit about how the technology works under the hood? I think this is something that's very interesting to our viewers. It's humans and machines working together and not just humans or just machines, right? Correct. Again, as any early stage artificial intelligence machine learning company starts, there's always human in the loop for many, many years. But right now, the product works in Microsoft Word and in Google Docs, and you can click the button and it will automatically simplify lately as much as 40% of the texts that you have selected to get it to simplify specifically when you're looking at contracts. And then in the sidebar, it'll give you, here's a rewritten sentence, here's word swapped out, and you can see it and compare it to the original because you're in Microsoft Word, you see the original document and the sidebars, the script swapped version. And then you're like, oh, I like what you swapped. No, I don't like this. Yes, I like that. And then it's just like accept changes or reject changes when you're doing track changes. And under the hood, there's a lot of different things happening. So of course, analysis and understanding at the word level, but also at the sentence level, and also a specialization specifically within contracts, as well as having corpuses that are stratified by industry, because words like interest, for example, may be used in different contexts in finance versus in insurance. And so we've really started stratifying within our key early industries as well. So it's a lot of really complicated things. We have a custom readability score, a few patents pending, and maybe talk to my CTO if you really want to know more. So it's a thing that you can install on top of a word processor, and it gives you all the recommendations on the side. And cool. I mean, I imagine this might be really great to add to like Gmail as well, if that option becomes available. It's something we're thinking about in terms of business communication and the jargon that's so often used. A little prompt that's like, what are you really trying to say here? Are you really trying to say this? Because you could probably say that in half the sentences and certainly without the jargon. That's really great. So let's back up a little bit. So how long has been around? I've been full-time with the team since January 2018. So it's 2020 now. So no, it's 2021 now. It's full-time, but I mean, I will say the original Genesis and my idea for it goes way, way back. Can you tell us about the, yeah, tell me about the origin story. Oh, the origin story. Yeah. I was, I was in my master's back in February, 2013 in Canada at the University of Western Ontario and just had a eureka moment of like, wait a sec, this journal article and the newspaper article about it, you know, we spend half a decade and take a dozen courses to figure out how to read these. This newspaper article is a grade five reading level, but they're actually not saying the same thing. Can't we use advances in natural processing and machine learning and have essentially a Google translate like product, but the same language, just different reading levels. So immediate, I just had the thought back in February, 2013. And really what took the longest time between 2013 and 2018 to build the business was less of the tech piece. You know, I looked into whether it was technically possible, kind of, you know, within that first year, but it was more around my confidence actually. And that's one thing I'd love to offer your viewers is, is how I had to grow to be ready to. Yeah. I would, I would love to hear more about that. Yeah. It's a journey, right? And so I came from a really small town in Northern Ontario, Canada. My mom's a nurse, you know, there's one optometrist in my family. Everybody else works at just regular stores and liquor stores and maybe one or two teachers, things like that. So the idea of running a business and in tech was very, very foreign to me. And so even at 23 in my master's, it was like, Oh, this is a really good idea, but Oh, I'm sure somebody else is already doing it. Or like, once I started looking into the tech, Oh, maybe some other big company will do it. That whole idea of why not me took a couple of years to be like, yeah, wait, I have this idea. Why not me? Why not be the person to bring it to the world? And that took two years to build the confidence around. And I did, you can probably see over my shoulder. I won an award from the queen of England in 2015, which is wild. And that gave me the confidence. I said, okay, so my work so far, my leadership, my community impact projects have been recognized on the international stage. Maybe I am confident. Maybe I can do this, but you know, I always say there are not nearly enough awards and certainly not enough queens for that scalable method to build undiscovered talent, right? Because just scale. And so that was what gave me the original confidence to legally incorporate and just get a business number and start trying, but it still took two years to find rich people, get angel investment from said rich people, figure out how to run the company, quit my job, hire a team, get customers. So it was a really long journey from 2013 to 2018 to actually get going on the business. And you've written some highly detailed blog posts and articles on fundraising advice. Do you want to give a couple nuggets of wisdom to our viewers about that? Absolutely. And I know you've said a lot of developers watch this show and developers looking to start businesses are gold, right? Because they have all the technical know-how. You don't have to hire as many people as I did because you know how to do it. And those fundraising skills can absolutely be learned. And I think the first thing to understand is it's a process. It's a process and every no gets you one step closer to a yes. So celebrate your no's in a fundraising process and make the process numbers oriented, which like very mathematical, very logical, just I'm going to reach out to say 140 investors. I know 80 of them are going to say no, 30 some are going to say maybe, and then I'll get down to my five, four or five who will actually cut me the checks I need. And so if you make it very process oriented and run it that way, it's much better for everyone. So that's the first thing. And celebrate your no's and know that they're just part of the game. Instead of like, oh no, it's like, yes, that no means I'm statistically much closer to a yes now. The second thing I would always say is take control. A lot of founders feel like they're going to investors like, please give me some money. And that's not at all the dynamic you want to have. And frankly, that's not the dynamic, particularly with Bay Area investors. I think in some geographies, investors can get a little bit like that, but the Bay Area is not like that at all because it's highly competitive. So fundraising actually becomes a service and they want to treat you as a founder really well. So once you realize that you as the founder are in the driver's seat and you get to decide who comes onto your capitalization table, who gives you a check, you're in control of that. You're not coming saying, oh, give me money, please. You're saying, I'm going to give you an opportunity to make a lot of money and I need to see if we're a good fit. And this plays out in two specific tactics. One, I always say the first seven minutes of an investor meeting matter most. So the first thing you should do in an investor meeting is take control right away and ask them questions and say, hey, Jade, I understand that you just raised a new fund last year, which means you should be about 25% distributed. Tell me more. Are you on track with that? Are you ahead? And investors actually really appreciate when you understand that the economics that they're operating under, when you understand their fund cycles, understand the pressures that they have from their limited partners. And when you take control right away and get your questions out first, they have to sell themselves to you. And that's a lot better to be coming from that position right up front. And then you get to share about your company versus the opposite of like, please give me money. And well, let me tell you what I'm doing. Instead, you're like, hi, I might choose you to be one of my investors. And you tell me about you and I'll see if I want to work with you. Oh, yes. And here's what we're doing. Here's the opportunity, right? Very nice. It's definitely the confidence approach. Absolutely. And bravado is celebrated in the founder world. And I think particularly for women, it's been socialized out of us for many years. But the more that you can bring to show that you are a strong and competent leader who can make decisions, the better it will be for you. Have you ever found there to be both positive and negative attributes for being a woman in the position that you are in? Double edged sword, so to speak. Do we want to do a whole other session on this? How long do we have? Look, I mean, there's there's the general challenges. We know the statistics. We know the numbers. We also know even if we're looking at the impacts of COVID. Right. Prior to COVID, women were capturing just over 2% worldwide of all venture capital dollars, just over 2%, despite the fact that women in the United States are starting businesses at a faster rate than any other cohort. And I believe actually, it's not just women, it's women of color, I believe, who are starting businesses at a faster rate than any other cohort in the United States. And then you look at the impact of COVID, where funding for women has gone down year over year from 2019 to 2020, by 30%. That's not okay. And so yes, there's a lot of large issues when you were looking, you only had a little over 2% to start with, you've gone down 30% of that 2%. It's not great. But I think the best way to handle that is to treat it as table stakes. There have definitely been times where I get frustrated, but it doesn't serve you. And it's okay to have those emotions, but it doesn't serve you. So I would treat that as table stakes, understand the landscape, and then leverage all of the amazing abilities that you have in the case of your audience that are probably very technical. And I don't know if it's woman traits, but I know for me in particular, as a person, the way that I lead is results oriented. My team can spend the time whenever, even pre-COVID, it was a remote environment, and results oriented with only a few less than four hours of meetings a week. And so there's a way to lead people that leaves them inspired, gives them permission to be their full selves, and even attracts people who are going to say, hey, actually, Melissa, I don't think we should make that decision. I think we should make this decision. I'm like, all right, great, explain why, because you know the tech better than I do. And so there's certain ways of leading that I think are specific to each person and just tap into what you're really great at. Yeah, getting the maximum amount of contribution from each team member and making them have that psychological safety so that they can speak all of their contributions is so impactful, especially compounded over the long run. And I've written about this. If folks are looking for the specific techniques, you can check out the Medium post I wrote March 2020 called How to Run a Remote Team in Less Than Four Hours of Meetings per Week. Nice. Actually, that's something I wanted to drill into. So the whole remote work thing. So a lot of companies have had a heck of a time converting to a remote work style in early 2020. But you and your company, were you all remote from the very beginning, a distributed team? Yes. How did you decide to be a remote team from the beginning? I wanted to attract the best talent. And coming from a small town myself and starting the company in Sault Ste. Marie, Ontario, Canada, which many people probably have never heard of, that to me was really important. Talent can be anywhere. It's about giving them the opportunities. And so you've gotten all your muscle memory in place with all the remote work, right? How did the beginning of 2020 impact you all since you weren't dealing with the fire drill of converting to remote? I assume it must have felt less than other companies. Yeah, it was funny because I had started writing that post because I had started speaking about it towards the end of 2019. And founders kept coming and saying, tell me more. How do you do that again? I was like, I just need to put this in the document. It can all be right there for everyone. I think the biggest impact was I was like, shoot, I better finish writing this and get it out. Yeah, it's a tome. It's very long. I think it says it's a 22-minute read. And I actually left an entire section out. I think when COVID first hit, the biggest thing there was, OK, I want to share this with folks as fast as I can because we know how to do it. We've got it down to a system after trialing and erroring over two years with different things. And if I can help people be more efficient, faster, great. But I mean, the biggest thing was more of our customers. They had huge impact, huge impact. So how did you, did you feel like business picked up when more people were doing more of their selling online in the early COVID time? We did have a strong Q1 and half of Q2 last year. Nice. By the way, speaking of before and after the pandemic, I saw one of your, one of your, there was a video where you mentioned that you had used hand sanitizer regularly before the pandemic. And woman after my own heart, I was, I am the same way. I mean, in developer relations life, it's a lot of trade shows, a lot of shaking hands, and you just know you'll get sick if you don't hand sanitize before and after everything. Can you tell us the story, the funny story about your first sales experience? All right, we're going to go there. OK. I'm glad you enjoyed it. That was from one of my guest lectures at the Rotman MBA program at the always has me come to the class. And yes, I love to tell this story because it's extremely embarrassing. And I think it humanizes the founder experience for folks who are just starting out. So here I am from the Sioux in Toronto, my first ever sales meeting with a big executive vice president, ooh, fancy at a large insurance company. And I get there, I say to reception, hi, I'm here to see so-and-so. And they say, oh, he's going to be running a bit behind. I was like, perfect. So I squirted out hand sanitizer as I do, because I just had opened the doors to walk into the building. And unfortunately, a lot came out, like way more than necessary. And I'm like, it's dripping on the marble floors. And I'm like, oh, my gosh, my hands are just sopping wet. And I'm trying to get it to absorb. And then as I'm doing this, I hear behind me, hi, Melissa. Oh, no, oh, no. He was not late at all. So like, hi, hi. He goes, he sticks out his handshake. I'm like, oh, you know, I just put a lot of hand sanitizer on, which is dripping. And he goes, no, it's okay. I don't know what to do. I'm like 27. I was like, okay, I stick my hand. It's the wettest, grossest handshake ever. It's disgusting. And I have sparkly hand sanitizer. So now the sparkles are transferring from my hand to his hand. And he lets me in the boardroom and goes, excuse me. And I'm like, yeah, he's probably gonna wash his hands. I was like, oh, my gosh. So that was the start of a very embarrassing meeting that later included my pantyhose, like flying out of my bag onto the boardroom table. And needless to say, we did not do business with them. But he's stayed a decent enough colleague and friend. Yeah, very embarrassing. You know, it's good to hear that he ended up being someone you kept in contact with afterwards and was good for a sounding board. And yes, definitely with the insurance industry, because we worked with several major insurers. That's fantastic. I mean, insurance is definitely one of those industries whose outputs I, you know, as a regular person, I gladly welcome increased readability. We all do. We all would love that. Now, let's imagine that we've just invited you into a magical Zoom call with a version of yourself from, say, 2018, with so much of your journey ahead of you. Can you tell me a little bit about what that conversation would be like? Conveniently, a friend actually texted me this morning and said, what would you say to your 21 year old self? Just three to four sentences. So I'll read you what I said to her. Because it's relevant. I said, hi, 21 year old Melissa. You are capable of far more than you think right now. Yes, really. All those people in your life saying that they see you doing big things are right. You'll see. The sooner you join them in believing in yourself, the sooner you will blossom into your most authentic you. You will find happiness, not when everything is going well, but when you choose to be happy every day with a gratitude practice. Keep writing letters to your friends. Keep reaching out to fancy people for help. And in less than 10 years, you'll have people reaching out to you for help. Pay it forward. I love that. Thanks. So yeah, that's what I guess about 10 years ago, because she asked for my 21 year old self. In 2018, I think the advice would have been fairly similar. I was starting to build my confidence at that point. Obviously, I quit my job. Here we go. And convince people to come work with me and paid them. But definitely, I think in 2018, the other things I would have added would have been around just focusing on the customer, certainly, but actually even more so on the data set. And knowing that my initial gut instincts were right about the ways to build the data set. So something I was wondering, did you ever pivot your focus at all in terms of the kinds of industries you were selling to? And tell me about what you learned in refining your market position. Absolutely. Every founder has to figure out product market fit and their go-to-market strategy. And if you think of companies like Lyft, it actually took Lyft three years to get product market fit. And for us, originally, I just put out into the world, hey, imagine if you could simplify anything with a click of a button. And we had some interesting inbounds, including from... Sorry, I have to sneeze. Okay, I think it's gone. Sorry. So really interesting inbounds, but particularly the titling was VP Comms and Marketing at banks, insurance companies, and big organizations like that. A little bit of healthcare, but I knew healthcare would be really tough, so I stayed away from it, given I had worked in healthcare previously, both in public health and health innovation for many years prior to starting this company. But I used to sell into VP Comms and Marketing. And then we had all these inbounds, and they didn't close. And that told me, oh, this is a nice-to-have, not a need-to-have in marketing. It's not driving a specific KPI that these VPs are held to. It's not driving a line item on their budget and making it cheaper. It's just not having enough of a demonstrable impact because it's such a new and unique technology. So we pivoted away from selling into the VP Comms and Marketing role, and instead selling specifically to contracts managers because they do have specific needs around speed, how fast they're signing contracts. That's where that 60% faster signing comes in. They are all about relationships. They're measured, they're hired, fired, and promoted based on the speed at which they close those deals and the way they manage those deals going forward. And the best way to do that is through clear communication. So we've found significant uptick in the contract space. Plus, from a data set perspective, when you take the most complicated legalese manifestation of English and try to simplify that, anything else is easier, right? So data set is very robust. Nice. So we just have about a minute and a half left in the segment. So very last thing, is there a book or a movie or something else that you really enjoyed recently that you would love our audience to hear about? I love this book so much, I keep it right beside me on my desk. It's by the Basecamp founders. You can see I've tabbed it to the high heavens. Wow. It doesn't have to be crazy at work. And it talks about a much more livable way to work in a very successful manner. So I really recommend it doesn't have to be crazy at work. Nice. I will definitely put that on my to-read list. Thank you for that recommendation. Amazing. Thank you so much for having me, Jade. It was fun to talk about the inspiration and share a few embarrassing stories, areas where we've hit it. I feel like we got everything. Yeah, this was a great show. Thank you so much for joining us. Absolutely. See you. Bye.