You don’t have to wait until you’re struck with a brilliant business idea to start scratching your entrepreneurial itch. There are plenty of opportunities to create efficiencies and solve impactful problems that aren’t being addressed when you’re working for someone else. This not only makes you a more effective entrepreneur in the future, but it can help you earn more money and skip several steps in your career.
Micah Brown grew up in South London, and started coding for fun at just 14 years old. But when he graduated college at 20 years old as a Royal Honoree in the UK, finding software engineering jobs wasn’t easy. He decided to exercise his entrepreneurial instincts at his first job out of school working as an admin assistant at Aon. His ingenuity would go on to save the company $56 million.
In this episode, the first of two parts, we discuss how Micah Brown used his expertise as a database engineer to run product at massive brands like NBC Universal and Viacom, and how this led to him starting two companies in his mid 20s, both of which were eventually acquired. In next week’s episode, he talks through how he negotiated the sale of his businesses and what lead him to launch a $5 million Deep Tech and Neuroscience fund this year.
2:01 Vadim: how did you get into entrepreneurship?
2:08 Micah: Grew up in South London, not a great area, so my parents pushed me to do well in school and get a job. Did 9-5 for a while and was a low key entrepreneur.
2:30 Ended up graduating at 20 with Royal Honoree at Uxbridge College. And until about the age 24-25 I was working for others mostly.
3:10 Started coding at 14, just hacking video games.
4:30 In high school hacked his attendance record to get into a good college, which his teacher only found out years later.
5:00 I was always a tinkerer. Ended up getting into database engineering as well.
7:40 Vadim: it sounds like you bring the same curiosity to investing now too
8:00 Micah: A lot of the nerdy things that don’t even make it into VC parlance, I’m curious about. Now getting into IP Syndication.
8:07 We partnered with a company called knowledge base capital where we created this IP valuation software, that can tell you if someone’s IP is really worth something.
8:37 Some VCs ask how we do this, but to me you just have to spend time thinking about it. I like to see how we can use data science and AI can be applied in these environments to optimize things and innovate.
8:45 Sergei: speaking of VCs and lack of accountability. In fact, in the contracts you sign with your LPs, it explicitly says that the GP can make all the decisions about investments without you. Now of course there are some fiduciary responsibility rules and you can’t lose people’s money or they’ll never trust you with it. But there is a lot of freedom to make decisions.
9:20 What was the first time you pursued something that you thought could actually be a business vs. just tinkering around with something?
9:24 Micah: well, the first time I did do that, it made $70 million for the company I was at. A woman named Nina Boon really changed my life.
9:50 At 16 I worked in retail banking, hacked together some of the retail bank systems to make them better, which then got me into credit risk. Did school at the same time and then went to work in investment banking as a consultant.
10:10 Started iFlux while there which was basically a recruitment agency for investment banking skills. Then got a chance to work at Aon and started there as an admin assistant.
11:22 Took the job because it was a hard time in the UK to get engineering jobs. So this was literally just transposing stuff that’s written down, into a database.
11:34 I figured out how to automate it with 10 lines of VBA code, and the next day 10 people on the team got fired.
13:00 Ended up being placed on this data warehousing team initiative to put all their paper documents in databases. Learned a lot about database engineering and about project management, and ended up running the team by the time he left.
13:38 That propelled his career. Fast forward to Aon, he saw a ton of inefficiency with brokers with huge expense accounts. The company was making $34M on $20M spend.
13:50 To show these inefficiencies he reconciled Salesforce with their billing system, which then his boss Nina could use to get on top of all of the brokers. This ended up bringing their margins to $70M
14:30 Vadim: So really your first entrepreneurial experience was an intrapreneurial experience, which is important to note. Every company has inefficiencies that you as an employee can try to solve to add value and elevate your career. I did the same thing in my finance job by automating my work with Excel macros.
15:40 Even though my boss would be upset because I didn’t do the “fake work” they wanted me to do which was pointless, they kept on giving me more responsibilities because ultimately I automated things and made my work more efficient.
16:00 Was FilmFundr your first real entrepreneurial project beyond the agency/consulting stuff you did?
16:11 Micah: I think Gary (Vaynerchuk) says this well – you gotta fail before you can succeed. The founders I know who didn’t fail right away and raised big venture rounds eventually ended up failing. This is because they couldn’t get the business to work because they didn’t have the skills and lessons from failure.
17:11 While working at NBC he was in a production meeting where this guy came in and pitched this TV show, but he didn’t have the data behind it to convince the executives. It was all about empowering black people on TV.
17:40 They asked me to run the numbers on it, and since it was a new genre that wasn’t proven, I told them the industry numbers just aren’t there.
17:55 The show ended up going to FOX and becoming a huge hit.
18:22 I saw that because this guy didn’t have focus group data, he wasn’t able to sell his idea initially. How many filmmakers must experience that? What if I could build a product that could help people like him, film students. That’s how FilmFundr started.
19:50 At NYU got 30 filmmakers in a room who hadn’t got their film funded, and I was able to help them get traction with their film with this new data.
20:15 But even with this traction the idea couldn’t get funding because the ultimate decision makers who were people in these studios, weren’t paying for it. But ultimately Netflix ended up putting them out of their jobs.
20:20 Which is why I got acquired this year by Battery Park Entertainment, which is connected with Netflix and Amazon and is using this model with them.
20:38 Sergei: how did the acquisition come about?
20:42 Micah: I was getting to know Mark Downey, who runs Battery Park Entertainment, and he saw all these executives leaving to go to Facebook, Netflix etc., and he saw that the only way to fund new ideas was to put data behind them.
21:46 Sergei: How did you meet this guy Downey?
21:46 Micah: I met him at Rainbow 2020 which is something that Jesse Jackson runs every year that I get invited to. I happened to be at Mark’s table and I started talking to him about FilmFundr. By then I was doing Centiment full time.
22:00 He asked me what I was doing with it, I said nothing. But he liked the idea and he ended up using it on a few productions. One of his main investors told him he should buy it, so I sold it to him 8 months ago.
22:18 Sergei: So you have this asset, how do you even start understanding how to negotiate that sale?
22:29 Micah: I read a book that I highly recommend, Be Smarter Than Your Venture Investor, by Brad Mendelson and Jason Calacanis. From this book I learned how to negotiate and I learned what it meant to do an asset sale, and that’s what I did. That was better than selling the whole LLC because an asset sale counts as a net operating loss, which helps avoid a major tax event.
23:30 Sergei: How did you know how much to ask for?
23:49 Micah: There’s a few different ways to do that. I talk about the Berkus model, which is a market validation that you have for a principle. This looks at other transactions like yours in the space. But you shouldn’t just look at market prices because ultimately it’s a negotiation.