Elio: [00:02] This episode is brought to you by our friends at Nodis. Nodis is a fast-growing smart glass technology startup headquartered right here in Columbus, Ohio. Nodis’ TruTint technology gives you the ability to change the tint, color, and temperature characteristics of windows, which helps to make buildings more energy-efficient, and the inside of your car more comfortable. Ahead of a Series A funding round, Nodis is investing heavily in Columbus by building its commercialization, systems engineering, and sales teams here. And the company plans to build a manufacturing facility in 2020 as they ramp up production and sales of TruTint to glass manufacturers across North America. To learn more about Nodis, explore investment opportunities and browse their job openings in Advanced Materials Research, systems engineering, sales and manufacturing, visit nodiscorp.com
[00:55] 614Startups Nation Welcome to another episode of the 614Startups podcast. I have a very special guest on the podcast today, Matthew Benson of eFuse. Welcome to the show, Matthew.
Matthew: [01:06] Thank you, excited to be here.
Elio: [01:08] All right, man. Well, I’m not a big gamer, okay, but I know that the gaming industry is huge. So I’m hoping by having this conversation, you’ll be educating me and you’ll also educating some folks who are not quite familiar with the gaming industry and what eFuse aims to do in this particular industry. Now, I don’t want to step on your podcast, man, but culturally, in the bigger context, there are a lot of things going on in the country.
Matthew: [01:32] Yeah.
Elio: [01:33] Just pray for everybody out there who’s protesting under their constitutional rights to do so, everybody remains safe and that justice is served, and that we can continue to heal as a country.
Matthew: [01:46] Absolutely.
Elio: [01:47] All right, man. So let’s get to it. All right. So let’s start and I like to start every podcast with a bit of the background on the guests. Some people have never heard of you or they know you or just know you by name. So give us a bit about you.
Matthew: [02:00] Yeah, so born and raised in Chillicothe, Ohio, so about an hour south of Columbus. Grew up loving video games. I was never any damn good, but really enjoyed it, loved playing with friends, right? Always had a little bit of an entrepreneurial bug. Never really had any entrepreneurs in my family but always knew that I wanted to do my own thing. And entrepreneurship, which I didn’t really know what that meant at the time, ultimately evolved to understand that that’s what I want to do, right? So go on to Ohio University, I study entrepreneurship and finance there. While at school at Ohio University, get exposed to a lot of great experiences, one of which was working at the Ohio Innovation Fund in Columbus, Ohio as an intern, as an investment analyst. I think you actually had a Bill on your podcast not too long ago. I learned a lot from Bill and Jill there. I had a really great experience and it kind of enveloped me into what venture capital looked like which I had no real conception of prior to that. So I had a great experience understanding not only what entrepreneurship looked like by looking at the other CEOs around me, but then also having the Ohio Innovation Fund and having the experience from the venture capital side, really unique experience. So I kind of get this whole picture of what entrepreneurship VC fundraising looks like.
[03:10] Go back to school while at Ohio University, and take a class called cluster. And in essence, cluster is a semester-long experience that is focused on an industry where you actually develop a business plan. So I got really lucky and the class that I actually had while at OU, the industry was video games, video games and eSports. So we’d go through this entire process, we’d develop this 180-page report on what are the problems, what are the issues, what are the opportunities, and ultimately develop this business, which to some extent, kind of looked like eFuse. So, see this opportunity and after graduation, go to work at Ohio Innovation Fund for a couple of months, but I just can’t get rid of this itch, right? Saw this opportunity in school, felt like I had the knowledge and the resources from the experiences I had while at OU and working at the Ohio Innovation Fund and at some point knew I was going to jump ship. So finally I said, “You know what, I’m young. Let’s just take a leap”, right?
[04:04] So August 2018, I leave the Ohio Innovation Fund at the time where I was acting as an entrepreneur in residence. Jumped ship to found eFuse, which in essence, is a platform for gamers where we help to connect talent – aspiring gamers, gaming enthusiasts – to opportunities. So that can range from scholarships, jobs, internships, tournaments, etc. So really, it’s this marketplace of opportunity, taking talent and opportunity and connecting the two, right? So not sure how far you want to go into that story, but basically, founded August 2018, and fundraised over the course of the next year and we’ve had some great success since then.
Elio: [04:40] All right, so it sounds like your experience at Ohio Innovation Fund turned you on even more. So sometimes people want to work in finance, they want to work on Wall Street. They get the internship on Wall Street, they go there, they see how the sausage is made, and they’re like, “Oh, hell no. This is not what I want to do”, right? Because there’s one perception from the outside and there’s another perception once you do it. So what was it about your experience that OIF that made you even more interested in going into the startup world, into the investing world, etc.
Matthew: [05:14] Interestingly enough, I think ultimately, I want to return back to that realm. I’d like to sit on the angel investor side, or maybe get into another fund. But what I realized is I had this itch to be on the operator side that I just couldn’t scratch being there. And I learned so much there, and so much of it is applicable to me as an entrepreneur, going and fundraising, going and working with some of my investors. It’s a long-term relationship and I got to see that from the other end of the spectrum. So I think it was a little bit of Bill and Jill, having their guidance and sort of their blessing, if you will, to say, “Hey, if you have this itch to jump ship, go do it. We support you, we back you.” So it’s partly that but then also, while I was there, I had the opportunity to be around other CEOs that were within the portfolio. So I built some really great mentor-mentee relationships. And I think it was those relationships coupled with Bill and Jill and other mentors in my life that ultimately gave me the confidence to say, “You know what, I’m young, let’s do this” and jump ship. But at the core it was, “I have to scratch this itch of being an operator at some point, why not do it now?”
Elio: [06:20] Well, Bill and Jill that rhymes right? I’ve never heard their names said together like that, I didn’t even realize, yeah, but they make a dynamic team. And I think when you’re investing early on, you’re really investing in founders and founding teams. And you were on the opposite side like you said, you learned a lot from them. As they’re looking at these different deals that were coming their way and the founders who were presenting them and the people who were getting funded, what were some of the characteristics maybe, that you saw in those people that you saw in yourself that made you think, “Hey, I want to be an operator. This is something I can do. This is something up my alley.” What were some of those characteristics that you found in yourself that made you think you can be successful running your own company?
Matthew: [07:02] Yeah, that’s a great point. One of the lessons that I learned while I was there was, and this is directly from Bill, and it was the people that take you from nothing to something and the people that take you from something to a little bit more and then from a little bit more to all the way to the top, those are different sets of people. Or maybe not even different sets of people but different skill sets, nonetheless, right. So I think it was understanding and being able to see companies at different stages, you can sort of identify what are the traits that are really good that can take companies from nothing to something, right? And that’s where I would have been when I jumped ship, and what I saw there, one of them was, there’s got to be persistence. You’re going to get a hell of a lot of no’s along the way, and just being willing to say, “You know what, I really do believe there’s something here, let’s continue to do that.” But the other part of it is, especially for a first-time founder, there’s a lot of ambiguity and I’m the first one to admit it. There’s a lot that I don’t know today. There’s a lot I didn’t know a year ago that I know now, but being willing to just jump ship and have the humility to understand that first and foremost, but then being able to not get overwhelmed by the ambiguity and navigate your way through it, and surround yourself with people that can help take you to that next level. That’s kind of the mindset I’ve had throughout the entire thing is, there’s going to be a lot that you don’t know, deal with it along the way, bring the right people in, have persistence and perseverance. And if you find product/market fit, and you really have something the value will pay off.
Elio: [08:23] All right now, do you ever get this feeling like you’re going to get found out? Like somebody’s going to find out I don’t know what I’m doing. Do you ever get that like, “Oh, no, I’m in front of these investors. I just raised– Okay, no”? Do you ever get that feeling commonly known as imposter syndrome? Because I think that’s one of the things that people kind of fear the leap, right?
Matthew: [08:42] Yeah.
Elio: [08:42] “Well, I don’t know everything I need to know so I just never take the leap.” How do you manage now that you’ve taken the leap? And also the feeling like you don’t know and that wanting to run out of the room sometimes?
Matthew: [08:53] Yeah, I really dealt with it early on, right? Because to be honest, not only am I working with investors that have a lot more experience on paper than I do but on the flip side, I’m also in the gaming industry working with some high profile athletes, influencers, celebrities, too. So I’m in conversations with both of these parties, which, from a social class standpoint, you’re thinking like, “Oh, these are the top of the top. These are the smartest people in the world, right? These are the elite, if you will.” But what I realized early on is that these are just people like myself, in the sense that, yes, they’re further along in their journey, they do things the right way, and they have more experience than I do, but at the end of the day, they were in my shoes 20 years ago, 10 years ago, five years ago, right? And just understanding that and making sure you’re surrounding yourself in these communities of people that realize that we’re all just humans at the end of the day, and being [able 09:41] just have those conversations was so valuable to me. So I did, I dealt with it early on. I didn’t feel like I should be in the room. I was super nervous going into meetings, and there are some meetings admittedly, I still have that issue but for the most part, when I go into a room, I just take a deep breath. “Hey, we’re people having a conversation about something really interesting.” And I’m not trying to necessarily sell anything in that, it’s more like let’s build a relationship. Let’s have a conversation. Let’s see where it leads, and that’s helped mellow me and sort of my fear, if you will.
Elio: [10:12] Now, as you were looking at the gaming industry, I mean, you said you wrote a 180-page paper, right? Did you need a whole 180-page report to know that there was an issue connecting talent with opportunity and how does eFuse fix that?
Matthew: [10:29] Yeah. So looking back, it wasn’t necessary. It was absolutely helpful though. I had the ability to, in a safe place with teachers around me and professors around me, to have the conversation and really look in-depth into something. So it was a nice thing to have. Do I think it was absolutely necessary? No, I mean, that stuff I could have learned not only jumping ship but learning along the way, or I could have learned in a much smaller fashion, quicker fashion and began to execute on it. I do believe that’s the best way to do it is just pick up on something and move as quickly as you can on top of it, learn as much as you can and iterate. I think that’s the best way to learn, the best way to build. I will tell you from the beginning that early on, the business model for eFuse, or not even a business model, the problem we were solving was really focused on colleges, right? But as time went on, we began to realize that the issue we were solving, which again, is connecting talent to opportunity, really just a pipeline problem, was much broader than that. It was happening in the professional world, it was happening in the scholastic world, It was happening in everything in between, just connecting talent to opportunity and we didn’t realize that early on. That’s something that we learned as time went on.
[11:38] So as we built out the product, and as the story has sort of unfolded over the last year and a couple months, it’s been something that we’ve just had to build and iterate on. But as far as how we go about actually solving that need when it comes to the talent and opportunity piece, so what we do is we really build the pipeline systems in between. So for example, let’s take a student coming out of high school. Most people don’t know this but there are varsity level scholarships for eSport athletes at universities, right? Where you can get a full-ride scholarship to go play video games at Ohio State, at Michigan and at Oregon, wherever you want to go. And there’s a couple hundred schools that have that caliber of offering and people just don’t realize that. But in addition to that, there’s not a linear path. For traditional sports – football, basketball, soccer – to go from high school to college football to pro, it’s very linear, right? There’s some fluff along the way but the process is pretty much there. That doesn’t exist for video games for a variety of things.
[12:37] One is, it’s all happening online. So being able to track the data necessary to make decisions to recruit is hard to come by. The second thing is there’s no formal path and demographic information associated with an online personality so you really don’t know where they are in life. You may be recruiting somebody who’s 35 years old, or you may be recruiting somebody who’s nine and just a really damn good gamer, right? So being able to almost create this portfolio or a resume of sorts for gamers and gaming enthusiasts, and then pairing that with the different opportunities that exist, and using the process in the middle, the pipeline, to filter out those applications to fill the right opportunities, that’s essentially what eFuse does. At a very high level, you can almost think of it as a LinkedIn of sorts as well. So you’ve got all of these different entities, you’ve got all these different opportunities, you’ve got this network, but what’s connecting all of it? That’s where eFuse sits and specifically in the video gaming eSports community.
Elio: [13:29] We’re going to take a quick break and be right back after this message from our sponsor.
[13:35] Thompson Hine’s Quick Launch helps emerging startups get their initial team members onboarded the right way, with all the appropriate legal documentation for a fixed reasonable cost. Every dollar counts for a startup and making sure that all your team and equity compensation matters are handled appropriately, shouldn’t be dictated by costs. With the Thompson Hine Quick Launch Team and Equity Matters bundle, we ensure that you have employee offer letters, NDAs, intellectual property assignments, independent contractor agreements, and advisory board participation agreements. Visit thquicklaunch.com today and get your company and your team set up right.
[14:18] Alright, so let’s just focus on one talent. So you’re not talking about the back end side of the gaming industry, you’re talking about front end actual players, right? When you say talent, these are actual players of a variety of games?
Matthew: [14:31] So there’s really a three-fold. So one is talent when you’re talking about the true gamer, the person competing. You’ve got content creators, so these are personalities that play games but they are more applicable to brands. And then you’ve got gaming enthusiasts is what we call them, but this could be casual gamers. This could be individuals like myself that love playing but maybe playing at the next level is just not an option, right, they’re not good enough. Maybe it’s getting a job in the industry. So it’s really taking talent at those three different levels and helping to connect them.
Elio: [14:58] Okay, got you. Now, in terms of the first product when you were thinking about what would be your first iteration of this, I don’t know how many versions you’ve rolled out of this product, but what was the first thing you feel like you guys needed to get right in order for this platform to deliver to your customers, both on the talent side and on the opportunity side? What was kind of that first product like?
Matthew: [15:24] That’s a great question. To be honest, it was terrible. It was a horrible product. And one of the issues that we ran into, and I’m thankful that I had a mentor step in and say, “Hey, stop this, cut this off”, but we tried to boil the ocean day one. We tried to do so many things decently well – we thought we were doing them very well – but we were basically not doing them well at all. What my mentor basically stepped in and said was, “Hey, cut out all of the noise. Focus on the core product here, which is building a resume for a gamer and connecting them to an opportunity on the side. That’s the core offering here. The social network, the content around it, the messaging systems that you’ve envisioned in your head as being this ultimate product, you can’t snap your fingers and day one have that be a thing, right?” So what we basically had to do was refine our core offering, find that core product fit, and then evolve the product from there. So, again, we tried to boil the ocean day one. Let’s call it three, four months in, we really narrow in on that opportunity pipeline. And now we’ve really gotten that done well so now we’re beginning to re-expand back outwardly to build a network around, to provide tools and content to make people want to come back every single day.
Elio: [16:34] Yeah, I feel like, and like you said, there’s not a linear pipeline, whereas colleges go to the same high schools every year because they’re basically like their farm system, right? You know you’re going to pick up a good quarterback if you go to this school because they have a system that turns out great quarterbacks. I feel like you guys are rivals, right? So you have this website, you have all these prospects, and people are going there to see what you’re saying about the talent in the industry. So let’s talk about the resume. What does that consist of? Because I could go on LinkedIn and I could embellish a little bit about my work experience but I’m guessing you guys have to make sure that this person can deliver on what they say they can deliver on. So what is the resume component of eFuse?
Matthew: [17:19] Yeah, so there’s a couple pieces to it, right? So the first half of it is very similar to what you would see on a LinkedIn. It’s your education experience, it’s your work experience, contact information, maybe key events that you’ve been a part of. So that’s stuff that a LinkedIn would service. And that’s sort of like your persona, if you will, your demographic persona. But the other half of it is the gaming side of you. So, “What are your game stats? What are the different social channels that you’ve used to build your brand? Do you stream your gameplay? Do you have highlight clips?” Other demographic information like, “What’s your age? Where do you live?” that’s important when you’re getting recruited to college, that wouldn’t necessarily exist. So it’s taking half of the gaming, half of your true persona, the real person, meshing the two together creating this holistic portfolio that can then be applicable to a recruiter that’s coming in trying to fulfill an opportunity.
Elio: [18:12] All right. Now so here’s the other complication because it’s athletics, right? eSports is a big mega sport that competes on a very high level as well. You talked about just the resume, things about you, work experience, etc. And then true gaming data, a little bit more about your profile, how you game, what games you play, maybe what your rankings are, what your stats are, things like that. If you’re playing on Twitch, and you’re streaming how many people are watching, etc. But are schools also looking at character? Because I know the other side of college athletics, right, which is, “Damn he can play but is he a complete idiot?”
Matthew: [18:53] Yeah.
Elio: [18:54] So college athletes that play sports also have to look at that. Is eFuse being asked to look at that? Even though somebody might be ultra-talented, they want to know about their character as well?
Matthew: [19:06] Absolutely. I think that piece of it is very much so like traditional athletics. So the part of the pipeline is how do we just discover the talent? Who’s all out there? Who can we even talk about? That’s where eFuse really services. Then getting them to a conversation and ultimately, to a campus visit, of course, pre-COVID, right, but getting them to a campus visit, having that conversation so they can then sort of feel out the intangibles of it. That still falls on a college coach. So I look at us as more of “Hey, here’s who the talent is. Here’s where they rank in the ecosystem. Here’s a pathway in which you can communicate with them. Let us help you get the initial introduction. Get them on campus, have the conversation to fill out the intangibles. And then on the back end, we can help get them involved with your team, transferring that data over, get their resume to you”, right.
Elio: [19:57] So from the player perspective, I can understand maybe there’s just not that much information out there for you to apply directly.
Matthew: [20:04] Yeah.
Elio: [20:04] So there’s some barrier to entry for the player. Do you foresee in the future as eSports continues to grow, that players can just go direct to universities, or universities will be able to build their own pipeline independent of eFuse? That must be a major concern for you, right? Because as technology gets better, as these platforms get better, Twitch might say, “Oh, these guys over at eFuse, I mean, they’re using basically our data. Why can’t we just create a pipeline to the colleges and universities?” What do you see that might disrupt this business model? And how are you guys thinking about dealing with that if the players can go directly to the schools or other platforms that they’re streaming on can just go direct to the universities themselves?
Matthew: [20:48] Yeah, it’s a great question and that’s why we’re diversifying a little bit more outwardly. So that core focus of connecting talent to opportunity, yeah, that’s going to be our core business and the opportunities that arise, it’s more broad than just to universities. It could be jobs, it could be tournaments, etc., right? So not only have we diversified in the opportunities that we support, and built a pipeline of talent all the way through all different levels, all different sizes of experience but on top of that, we’re focused on building an ecosystem. So something that is truly a network that brings people together, allows them to meet other individuals in the industry and allows them to learn and evolve similar to a LinkedIn. I can go get a job via LinkedIn. I can have a recruiter cherry pick me, does that mean I’m going to leave a LinkedIn, right? No. The value in LinkedIn is the community as well. It’s the ability to learn based on the materials that are there. It’s the ability to network for the next opportunity. So that’s more so how we look at eFuse is we build the network and at the core have the opportunity piece, but that’s just one level of it. We’ve got to expand further to build the network that ultimately brings people back every single day. And then when it’s time to take the next leap and to find the next opportunity, they’re going to come back to eFuse to do that because we already have the full range.
Elio: [22:00] Thank you for listening. We’re going to take a quick break and be right back after this message from our sponsor.
[22:06] When companies large and small need to solve technological challenges, they turn to AWH. AWH has the experience and expertise to help your company create innovative and disruptive products for the web, mobile and IoT. Leveraging a deep understanding of machine learning, artificial intelligence, and blockchain, combined with the creativity that comes from their entrepreneurial DNA, AWH gives their clients the competitive advantage. Visit awh.net today and tell them about your project.
[22:38] All right, now let’s talk about resumes on the other end, meaning [inaudible 22:41] and just in this case, we’re going to focus on universities, right?
Matthew: [22:44] Yeah.
Elio: [22:44] So yeah, they want to get all this data on the players about how awesome the players are and whether or not they’re going to be a good fit for their university, but players on the opposite end, don’t want to go play for a losing team, right? You also want to play for a winning program if there is some competition opponent already on the university side. You want the number one player, you have the number five ranked eSports program in the country, there’s some competition there as well. So how are you evaluating university programs and then sharing that with your gamers so they can have some frame of reference, where they should choose to go if they have multiple offers coming in?
Matthew: [23:20] It’s a great question and the way we look at it is we just have to give them all the data they need and they have to make the decision the other day. For example, Ohio State might be the number one rank, but if I have a relationship with a coach who is maybe four or five tiers of rank below them, I may decide to go there instead or I may see an opportunity. So it’s very similar in that sense to traditional athletics. What we focus on is let’s make sure that the organizations – this is what we call them on eFuse because it’s more broad than just universities – but let’s make sure the universities are verified, all the information that a student needs to make a decision on what school to go to, what the performance is, who the other individuals are involved in that organization. And then let’s give them that data so that they can make that decision when the time comes. So it’s more about let’s make sure it’s verified stuff, verified contact information, verified data points, and then give that to them so they can make the decision on what’s best for themselves because we’re never going to know that, right?
Elio: [24:14] So how about benefits package or scholarship package? Like what you get and how much money you get. I mean, not saying that it’s going to get like college athletics but there’s a lot that players have to think about when they make choices.
Matthew: [24:27] For sure.
Elio: [24:27] And the “value” of the scholarship beyond just playing sports also comes into play. So are you providing that organizational data or that’s discussed directly between the player and the organization?
Matthew: [24:43] Yeah, we leave that to the player and the organization at this point.
Elio: [24:45] Okay.
Matthew: [24:45] What we do try to do is create content around “What does this look like? What is the next step in college? How do I build a portfolio that makes sense for college? What are the steps I can do to prepare myself for a gaming career in college? What are the steps I can do to prepare myself for a job post-university in the gaming industry?” We want to provide materials that enable and empower the next generation to learn so they can invest in themselves to ultimately have the resources and the knowledge to make those decisions. I think the college conversation as far as compensation, scholarships, etc., that’s where that takes place, on the end of the spectrum without us.
Elio: [25:22] Okay, so let’s talk users. How many players do you have on the platform now? How many organizations, monthly placements? How many people are going to school? Have you started to collect data on that so far?
Matthew: [25:37] Yeah, so a little backstory on where we’ve been and where we are now. So, again, jumped ship August 2018, fundraised over the first half of 2019. Closed our first round of funding, seed investment $1.4 million in August 2019. Go on to recruit a CTO, bring a really strong team in, build the product out, and on December 10th of 2019, we launched our first web beta product. We had a goal of getting 10,000 people in our early access waiting list but almost overnight, we had 25,000 people sign up. So it’s like, “Oh, man, okay, we’ve got some in here, right? Early signs, but we’ve got something here.” So continue over the month of December to let in 1000 people per day on a queue system and then on January 2nd, 2020, we opened it up to the world. So then at that point, anybody can go to efuse.gg, sign up, create an account, and join the platform – the ecosystem really. So since that date, we’ve been growing around three and a half percent. Can’t say the number aloud, but you can do the math on what that comes out to be. So we’ve been super fortunate. We have great growth. We’re getting to a point now where we’re not only facilitating those relationships and getting through that first cycle of recruitment for colleges, which is super cool but also seeing people get jobs, get these scholarships, and actually implement them into their lives, which is super cool.
[26:55] And one of the things we’re trying to do now is capturing those stories almost as testimonials, right? Like, “Hey, there’s value here. Our platform is for you to use right now. People come and can just access these opportunities if they build out their portfolio and put the time in.” And that’s the story you want to showcase is that a lot of it’s about effort. So now that we’re telling the stories, we are continually seeing more and more opportunities being fulfilled, and more and more providers coming back and saying, “Hey, this is better than anything else out there. Really, there’s nothing else out there like this. It’s so fully encompassing, and it’s got the direct talent that I need.” Gamers are on all kinds of different mediums. They’re on Twitch, they’re on Twitter, they’re on all these different things. But what eFuse does really nicely is we take out the noise, we zone in on professionalism, and we say, “Hey, this is a place of opportunity. This is a place of business collaboration. This is a place of professionalism. So when you come to our site, that’s what you can expect.” And the employers, the opportunity providers, they see that and the talent are seeing that as well. So we’ve been super fortunate.
Elio: [27:52] Okay, so here comes the big question. How do we make mulah, man? How do we make money?
Matthew: [27:58] Hey, it’s the golden question, right, but we’ve got a few answers to that. So let me back up and say, when we first started fundraising, the business model we proposed was a premium subscription service, and we still really believe in that. So similar to a LinkedIn, paying a monthly subscription fee to have access to exclusive opportunities on the recruitment side, to have access to enhanced tools, research, standings, metrics, communication tools, etc. So that’s the model we pitched and we still believe that’s a viable model that we’re actually in the process of implementing now. We’ll really be seeing that turned on the latter part of summer. So that’s number one. But one that we kind of stumbled upon that’s super interesting is with everything going on with COVID, a lot of things have shifted online, as you well know, right? A lot of the physical events that were occurring, whether in traditional sports or even in gaming are now shifting to online. And with that, advertising dollars are becoming available, those placements still need to be made. And because we had so many great relationships on the organization side, but as well as the talent side with some really premier influencers, athletes, etc., we began putting on tournaments initially as a community-building exercise. We wanted to put these tournaments on to where we could strengthen the community but what we quickly realized is we were getting some pretty crazy impression numbers. We were getting some great viewership numbers, and people are really enjoying watching it.
[29:17] So then we had sponsors come to us and say, “Hey, have you ever thought about taking out sponsorship dollars for this?” We were like, “Oh, no, we really haven’t.” But we opened our mind to that and ultimately, we were able to bring some sponsors on and that’s become a really viable business model for us. To be determined how that will change post-COVID. I think there’s always going to be online events, just the scale of them, who knows. But it’s gotten us to a point where we’re almost cashflow neutral after six months of business, which is pretty awesome, especially as you’re looking into going into a Series A, not even having implemented your core business model. Not only does that give you flexibility on when to fundraise, how to fundraise, what the valuation is going to be, but it also gives us a really nice opportunity to experiment, to build what’s best for the community and make sure we get the premium subscription right when we implement it, and it’s of value. So that’s how we look at it. Those are the two big things.
[30:06] And then everybody sort of has this, but it’s worth mentioning but I think it’s also worth understanding it’s under [the] caveat of digital advertisements on the site. So as you get more and more people into the network, there’s a valuable audience for sponsors to come in and promote directly to the gamers. Again, you have that noise eliminated. This is a great way for you to spend your sponsorship dollars and your advertising dollars. So that avenue has arisen as more and more people have signed up for the site. I think it will just become more and more applicable as time goes on and we have chosen not to turn that on just yet. We have it already in place but [haven’t] turned it on, simply because the value that we’d get from the dollar amount is not as valuable as the community building that not having that gives us. Does that make sense?
Elio: [30:51] Yeah, I definitely understand and the desires of your customers also change, right? So what got you that tremendous interest, which is the connection to opportunities, if you now focus on tournaments and sponsorships, what’s that going to do to your user engagement, etc. and how many people are coming onboard the platform? Alright, man. So final question, cashflow neutral, very, very nice, right?
Matthew: [31:14] Yeah.
Elio: [31:14] But you can’t get complacent because you’ve had a lot of success very, very early on. So the question now becomes, what’s next? How do you keep building on this success? And where do you see eFuse three years from now, five years from now or so?
Matthew: [31:29] Yeah, I think there’s a number of variables that go into that. I think there are a few core things that won’t change. I still believe what Bill told me in my early days at OIF, “The skill sets that we need to take the business from nothing to something, from something to the next level and the next level beyond that are completely different skill sets.” But there are core factors that still remain, right? The ambiguity, the perseverance, the ability to have the humility to say, “I don’t know at all and I need to surround myself with people that can come in and fill those gaps.” I truly believe if we do those three things and continue with the level of effort that we’re putting in, we’re going to be in a really great position. As far as the next things for eFuse, we are transitioning into the premium subscription model, right? So getting that out there, basically coming up with the formula of how much does it cost us to get a user? What’s the lifetime value of that user going to be to us? And just building that model so when we go to Series A investors, we can have that already worked out and see what that looks like at scale. So that’s the big focus for us moving into the latter half of this year.
[32:27] The other big thing is we’re really about impact. So a couple of the things that we’re trying to do and get involved with are how can we give back to the community and provide opportunities from eFuse ourselves for the next generation and invest in those. So we have some really cool initiatives coming up. We just did one a few weeks ago called the “For the Gamers” campaign. We invested $150,000 worth of scholarships back into the community and said, “Hey, this is for scholarships for the next generation of gamers.” As we’re successful and more of that continues to grow, I never want us to lose sight of that. And so that’ll be a big focus for us moving into the back half of 2020, especially with all the craziness going on, and trying to provide a unifying voice and a voice of uplifting and hope. That’s really where we see eFuse and want to position ourselves in the coming months.
Elio: [33:15] Well, Matthew, thank you so much. I appreciate the time, man. This has been great. I feel like I understand eFuse. Hopefully, for all the people listening, they get it now, right? What this business is all about and maybe even why you’re having this success and you’re scaling so quickly. I end every episode with my one takeaway. My one takeaway is for all imposters in one way or another, particularly first time founders.
Matthew: [33:40] Yep.
Elio: [33:40] The feeling that some people who are watching this, and I get this all the time, when I’m pitching a sponsor, or I’m rolling out a new product. Most of the time I have no idea what I’m doing. I’m scared out of my mind but regardless if you’re passionate about something and you have something, a problem that you want to solve, don’t let that feeling of not knowing, that fear in the pit of your stomach, stop you. Thank you so much for joining me on another episode. Peace.
[34:10] That’s a wrap. You can find this and all our episodes on our website, 614startups.com, Apple Podcasts, Spotify, Anchor, and all your favorite podcasting platforms. Don’t forget to subscribe and write a review. If you would like updates sent to your inbox, you can sign up for our weekly newsletter on the website. To engage in the 614Startups community, follow us on LinkedIn, Twitter, Facebook, and Instagram at 614Startups to join the conversation. For sponsorship opportunities and collaborations, email us at info@box5405.temp.domains.
[34:47] It takes a village to do a podcast and I would like to say a special thank you to my friends at Waveform Music Group. Andy and Carlin have been working with us to enhance the production of 614Startups and we’re so happy with the results. Outside of podcast production. Andy and Carlin are experts in sonic branding, songwriting, and music production for companies and creatives. To learn more about them go to their website createwaveforms.com, that is createwaveforms.com.
