Dan Reich: After 4 Exits, I Have No Desire to Retire!

0:01Dan Reich. He has sold four successful companies, but he's far from finished. Retirement isn't in his plans anytime soon. What drives his relentless hunger, creativity, and energy? How does he find such clear direction so quickly after each exit? In this episode, Dan shares practical wisdom with us in an honest and straightforward manner. My siblings and cousins, it's like lawyer, doctor, lawyer, doctor, nurse, accountant, and then, as my uncle called me, the black sheep and independent thinker. You can do anything, but you can't do everything. You go from a mission with clarity, with purpose, with intensity to literally nothing.

0:41And that can be really sad and lonely and depressing. You don't want to be 80, 90 years old at the end of your life and look back and think about the regrets you had. In fact, you want to minimize the regrets you had. And when you think about life through that lens, a lot of these decisions that we're faced with each day become incredibly clear and easy very fast.

1:11Thank you so much for joining me today. I'm very excited about talking to you. Did money make you happy? Money made me stress less about paying the bills, but money, no, money did not make me happy. What it did allow is more freedom to go pursue of amazing experiences. Those things made me happy, but money in of itself is not happiness. I know many people that have made much, much more money than me that are very unhappy, and I understand why. So on a scale from zero to 10, how would you rate your level of fulfillment? On a scale of one to 10, my level of fulfillment right now is probably about a seven or eight.

1:52And the reason is I'm very excited at the moment about building and investing in new companies with amazing people and taking ideas and turning them into hopefully something amazing, exciting, and meaningful. The reason I'm probably like a seven, eight and not a nine or 10 is because I know that I haven't kind of perfected that model. I don't have all the answers and not having all the answers is kind of sometimes annoying, but keeps it fun and keeps the pursuit and game alive. So that's where I'm at right now. I'll be a 7 or 8. Who do you want to be when you grow up? I'm going to cheat on this one.

2:30Matthew McConaughey gave a great speech about this, but I want to be the better version of myself. I want to chase the better version of myself that I'll hopefully be 10 years from now. Can you describe the direction you want to go to? The theme for me and direction that I'm pursuing is one that lets me work with amazing people, help make them successful, in turn make our business and project successful, and then see them be able to go on and do bigger and greater things. If we do those things, then that's incredibly rewarding at a interpersonal level with those friends of mine, but also financially, there should be some financial reward because we will have done a good job.

3:09And being able to see those people go out into the world and do bigger, better things and even we did together is also pretty, pretty exciting. Is Angel investing a good financial decision? It has been so far. It's a hard game, but we'll see how it goes. So what are the most important lessons you've learned from your big exit? Perseverance is probably the most important quality and characteristic for an entrepreneur. There are no shortage of moments when I thought the companies would die. There are no shortage of moments when I thought the companies would not transact or exit, when I thought for sure they would happen, but we just had to persevere.

3:47And that perseverance let us build a great company. It also let us ultimately sell the businesses. For someone who just sold a company and thinking what to do next, what your advice would be? Take your time, but trust your instincts. It's really natural to sell a company and be faced with this idea that you can do anything and everything. You can do anything, but you can't do everything. And don't run away from your instincts and who you are just because you're in a position where suddenly infinite options are available to you. When you put yourself in that position, it's also very easy to fall into analysis paralysis and the paradox of choice.

4:25So I would just say in a paradoxical way, lean in, actually isolate, really listen to what you've done, what's exciting to you, and don't run away from it just because you can do whatever you want. So you mentioned that introspection is extremely important. So So how would you suggest someone stimulate going into introspection for themselves if they don't do it naturally? Everybody's different. For me, I find introspection happens best actually through conversations with other people. Having those conversations lets me experience new light bulb moments and parts of the world thoughts, ideas that might be harder to do on my own.

5:07Another would just be to read. I love to read, so I'll read a lot in search of new ideas. But those two things combined are useful tools and have them for me to kind of think about what's important to me and where do I want to spend my time. How do you choose the people you surround yourself with? A heuristic I like to use is, can I see myself working for this person? Would I want to work for this person? Do I think they're smarter than me in a multitude of ways? because again, I try to be the dumbest person in the room. Then how do you want to be remembered? I think the way I'd like to be remembered is as someone that helped make an impact on the lives of other people.

5:49And that impact has been a catalyst for their life and hopefully as a result, the lives of many others. So you had a number of exits, I believe four, and the first one was very early in your life when you were 22 and still in college. Can you tell me more about it, how it happened and how you felt at that moment? Yeah, sure. So in college, I started what became an events and marketing company with one of my closest friends in school. We studied engineering together. We actually started another company together. And we just realized towards the end of school that we didn't want to be in the events and marketing business kind of full time.

6:30I knew I wanted to get into technology. He knew he wanted to get into law. Ironically, we're both neither really in that past squarely anymore. But we decided we wanted to sell the company so we could go on and pursue other endeavors. So we privately sold that company. That was the first kind of exit departure from the company we started in college. The way I felt after was fine because we were already working on the next chapter of our lives with both law school and for me working on another startup. So you knew at the time already that you would go serial? Yeah. Even before that, I had started a company.

7:14Actually, my first company I started that I did not sell that failed was in high school. So that was my real first company when I was, I think, a junior in high school. Sounds like you were a natural. Yeah, I've been doing this my whole life. It's more like a game than anything. It's fun. So which of the exits would you say was life-changing for you? I mean, life-changing, I think when you use that phrase, most people probably think about that phrase as monetary, right? Life-changing, you've made a bunch of money, it changes your life. I think actually maybe the, I was building a company with two buddies from college called Spinback.

7:56We ended up merging that with a company called Buddy Media, which we then sold to Salesforce. That probably was the most, at the time, life-changing because it kind of proved that even at a young age, mid-20s, we can build a business and go toe-to-toe with some of the greatest companies in the world and win and be rewarded for it. So that exit wasn't financially life-changing, but it was life-changing in the sense that it just gave me a new sense of confidence and almost kind of like getting a monkey off my back, proving that I could do this well, which then helped set the foundation for things I've done recently and things I'm continuing to do today.

8:40So proving yourself was what you really wanted. That was your motivator or was it more financial? Yeah, I remember growing up reading about all these amazing entrepreneurs that built companies from scratch and took them public and or sold them for lots of money. And just that idea of going through that arc and that journey was intriguing to me. And to me at the time, it was less about the kind of pot of gold at the end of that journey, but really can I actually experience that journey start to finish and prove to myself that I can go through all of those checkpoints and gates so after doing that the first time that to me was very rewarding because it was like oh okay I just demystified for myself what this journey is and I understand it now it's very real it's very practical and now knowing that and getting that monkey off my back and proving that I can do that now I'm going to punch up and see if I can do it a little bit bigger better faster maybe in different domains so again to me it was like can I play the game and win even at a relatively small scale and having done that now I know that I could and that again kind of set a good foundation for things I'm I've done and I'm currently doing again is competitiveness part of it or you really love the game it's competitiveness with myself.

10:04I think when I was younger, I was naive to think that business is really about beating your competition, but I think it's really about winning for your customers. And when you think about it through that lens, you're constantly faced with questions, critical thinking, problem solving, creativity on how to best do that. And that really is an internal battle with yourself and with your team. I think many companies and entrepreneurs make the mistake of focusing too much on competition and maybe looking through the rearview mirror or copying other people and not enough time on the customer. And when you think about it through that lens, it's also much more fun, right?

10:52Like you have a white canvas, you get to be truly creative versus if you're focused on quote competition, I mean, what a soul-sucking endeavor because you're literally looking at other people all the time, day in and day out, trying to build your business strategy journey based on what other people are doing and what they think. To me, that's completely uninteresting. Again, more interesting is thinking about things with first principles, looking at the customers with fresh eyes and thinking what new product, service or solution can I bring to the world that's new and different and fresh and interesting and yes maybe sometimes it may look and feel like quote competition but that's okay so long as you're approaching it with a fresh set of eyes it's more fun that way and for me the journey is the prize so it's important that it's it's fun and to me that's how you keep it fun and fresh so would you say creativity is something that you also love about this game oh yeah yeah absolutely when I I used to play with Legos.

11:49I would build the thing out of the box with the instructions. And then shortly after I'd break it all, make my own thing. A similar approach one can bring to building businesses. And certainly I do. It's for me again, and journey is the prize. Like I love the game. The game to me, this is like it's sport, it's art, it's science, it's math. It's all rolled up in one. And it's just amazing because it's not just the sport of one. it's also a team sport. So you get to work with, if you're lucky, incredibly smart people that you can learn from every day. And that's another dimension that probably the most important that I lean to heavily, which is like, how do I find better people than me?

12:31How do I surround myself with people better than me that I can learn from? And again, if you do that, your working days are much more fun and energizing than if you're in some nine to five job that you hate where you're like clocking in and clocking out. So for like reasons, I think building companies just are much more holistic and fun and energizing. So you plan to keep building them and selling them, or at some point you want to just have a business that you will never sell? How are you thinking about it? I don't think about that too much. I try to think about what are businesses that I can build that I can do a really great job by my customers that creates shareholder value and enterprise value that perhaps one day I could sell or perhaps one day I could take public or perhaps neither and hold on to it.

13:23And I think job one is to just build a great and healthy business that people love, people want to work with and for. If I do that, then I'll have options later and I'll evaluate those options kind of later on down the road. When I was building, for example, Tulip Skincare, which we ultimately sold to Procter & Gamble, in the earliest days, I didn't even know if we would survive or sell anything, any unit or any kind of quantum in sales, let alone would we have a really meaningful exit. So by focusing on, let's just not die and let's try to sell products and not die. Let's start there by starting there and being paranoid about surviving and not dying over and over and over and over again.

14:07And you fast forward in time and you realize, wow, you've built a pretty meaningful company. And now you do have potentially an opportunity to sell the business to somebody else. And in that moment, we decided, yeah, it is a better decision to sell Tula Skincare to Procter & Gamble for a whole host of reasons, certainly one of them being financial. But how amazing it is to think about starting from nothing, just a crazy idea, building something to real scale. At time of exit, I think we were doing about 150 million sales. and now have one of the most iconic, at least in my mind, one of the most iconic companies in the world take stewardship over the thing you started to continue to roll it out globally, support it globally at a scale that I could, I never even really thought about when we were building a company.

14:53Again, I thought about let's just not die. Believe me, there were moments when I thought we would die. So yeah, for me, it's like, again, journey is the prize. If you build something that's valuable and fun, then inevitably there should be options for you to evaluate. Were your parents also entrepreneurial when you were growing up? So my father was and still is a real estate developer. So he's been building houses and apartment buildings his whole life. So there is a dimension of entrepreneurship there for sure. But I would say even more than entrepreneurship is like literally building, right?

15:28Like watching a plot of land go from nothing, dirt, grass into a residential development or apartment building, that physical sense of zero to something that you could touch, feel, and see, that always stuck with me, I think, because, again, I grew up with it. And same with my grandfather, my father's father. He came here from Europe after World War II with nothing, couldn't speak really any English, and had built a farm delivering eggs five, six o 'clock in the morning from Southern New Jersey to New York City, a two hour drive each way, seven days a week. That's as entrepreneurial and hustler mindset as you'll get.

16:18So in some ways, I suppose it's like in the family. But yeah, for me, when the internet came along, I was just pretty excited about building on this new medium and frontier because I always felt like in a physical sense with the house or store, you have a physical location that had like a bit of a local maximum of how many people could come and shop up at store or live within that community. It was, you know, on the internet, like that's a global, that's a global story. That's a global town hall or square. That to me, it was really exciting, which is also part of why even in college, I leaned in pretty heavily and studied engineering, technology, computer science, because I felt like if you had that understanding of technology, which is the underpinning of how the world works, then that would be a pretty good basis for building businesses in that new frontier.

17:08It's funny because I remember when I was in college, freshman year, a friend of mine asked, what are you going to study a major in? And I said, I'm not sure. I have some ideas. What are you going to study a major in? And he said, finance. And I said, why? He said, because money is the way the world works. and I thought, well, actually, it's not the way the world works. Technology is really the way the world works. If you think about money today, money we experience is just ones and zeros that live on mainframe computers throughout the world. Funny enough, also at the same time, every single one of my friends said that they wanted to study finance and not anything else.

17:45They all wanted to get jobs in Wall Street. They thought they'd be rich by getting a job on Wall Street. We graduate and the financial collapse happens and all of them either lose their job or quit due to the circumstances. I think every single one of them, except one, have now gone on to pursue, we can call them more entrepreneurial startup endeavors. So for me, I've always felt that. But what's cool is I think increasingly in today's world, more and more people are feeling that as well. I'm leaning into this idea of entrepreneurship and company building. Would you say you were financially comfortable as a child?

18:23Yeah, for sure. I grew up in, let's call it upper middle class. I wasn't homeless or sleeping on the streets. I didn't come from a broken family. I came from a very loving family that did everything they could for me and my two siblings. I took advantage of that and decided to try to do something different and more. My family wanted me to be a doctor. I thought I wanted to be a doctor. It was like, you go be a doctor or a lawyer or accountant. And I think literally like my siblings and cousins, it's like lawyer, doctor, lawyer, doctor, nurse, accountant. And then as my uncle called me the black sheep and independent thinker.

19:05But again, you know, for me, it's just fun. The reason I was asking is because I actually noticed an interesting pattern that successful exited entrepreneurs who were not driven by money in their first business often come from very loving and financially comfortable environment. So I'm actually doing a project now trying to find more people like that to see if it is actually a person or I just happen to run into people like that. But you are a confirmation of that, which is very interesting because that's not what people normally think. We think that the laws of entrepreneurs come from very poor environments and they're trying to solve financial problems.

19:48But I don't think it's necessarily the case. I don't think so either. I think there's, in my mind, what I've observed is there are at least two types of entrepreneurs in this conversation. So one is exactly what you described. It's like the immigrant story that came here with nothing, or the person that comes from a kind of broken family that has no choice but to win and thrive and survive. Yeah, that's not me. And I'm fortunate that I grew up in a loving upper middle class household. But the other type that I wouldn't put myself in the bucket. I was like, because my family did so much for me, and they were so loving and supportive of what I wanted to do, and didn't shut things down all the time, I would say the majority of the time they were supportive and let me do these crazy ideas, like start a company in high school.

20:39I think that gave me sort of freedom and latitude to go be curious and explore these ideas. I would say that was accelerated by my first job. Friend of a family, lived down the street, built his own IT and computer company, building computers, networks, servers, things like that. Also engineering background. So in high school, my first job was literally working on a basement floor by hand, assembling computers, installing them, fixing them, and then bringing them on site and also installing them and fixing them. Hundreds, if not thousands of computers and servers. That was my job. And part of that job is he would take me to local Microsoft certified partner conferences, as well as Intel channel partner conferences.

21:29And I was by far the youngest person at these events in that room, meeting with the engineers at Microsoft and the engineers at Intel, hearing about the latest and greatest products or chip form factors they'd be coming out with or new operating systems. Because for me, that was my business. And that to me, at a very early age, accelerated this idea of like, I can, again, kind of go toe to toe with these people. They're my peers, even though I was, I don't know, a freshman in high school at the time. And so that also stuck with me, which is like, wow, here I am at a young age working with people much older and smarter than me.

22:09I can do this. What else? What else can I do? So I was really fortunate to have that experience early. And that just stuck with me early on this idea of like, why not me? Like, why can't I do that? And the curious part of me always latched on to those opportunities to go see, well, can I, can I do this again? Tool of skincare is a great example. I come from technology, engineering, software. And here I was starting a woman's skincare company. Granted, I had some pieces around me to help make that a reality and people that certainly did. But that idea of, could I do this? Was just super interesting.

22:47I think I could. Let me try. And it's that question and driving force and factor that I think is required for any entrepreneur, whether you come from a broken household or the immigrant story or from a kind of loving and good foundation. So there's a good quote that I like. I forgot who said it on Twitter, but it's like chips on shoulders, put chips in pockets. And how those chips get on your shoulders can manifest in many, many different ways. We talked about two of them, but I'm sure there's at least a dozen more. Okay. So if we go back to that moment when you had your big exit, when you sold to Salesforce and you were financially satisfied with it?

23:29How did that feel? It's a great question and what I've been having many discussions about. And it's going to sound ridiculous, but it was fun and exciting immediately and then a little bit sad thereafter. And I'll say this is like the world's tiniest violin, but many repeat founders or serial entrepreneurs or post-exited founders experienced this, which is like you've worked on something for so long, 24-7, this becomes your whole reason for being. That job, that mission, it's all consuming. And so after you exit that business, putting the financial rewards aside, you go from a mission with clarity, with purpose, with intensity to literally nothing.

24:15And that can be really kind of sad and lonely and depressing. and you can only really experience this if you've gone through it before. And so in that moment, after we exited Spinback and Buddy Media and as a kind of mid-20-something-year-old with some money, I was, as some people would call me, fun employee. I didn't really need to work at the time. I could kind of pick and choose where and how I wanted to spend my time. But for about a year and a half, that was actually among the more depressing moments professionally in my life because I felt lost and rudderless. I had no mission. I had no real purpose and I was so desperate for one.

24:53And in life, we know about like the Maslow hierarchy of needs. It's after you've satisfied some kind of critical necessities for one's life, you get into kind of these other bigger dimensions, which are like what gives you fulfillment and purpose and passion after you've got fluid and the shelter over your head and roof. and um yeah i was really wrestling with that so that was the first moment when i i realized that money is not everything you need kind of real fulfillment and in one's life the other dimension that helped me answer that question also at an early age is i've been volunteering as a member of national ski patrol for about 20 years a little over 20 years which is like if you if you've never been skiing before it's kind of like a paramedic on skis run into a tree break an ankle hip leg whatever like people in red jackets with right white crosses show up to help you and take down that so that's what i've been doing and in those moments or some of them what you realize are like people get up in the morning to go have a great morning of skiing and maybe it's like get lunch and maybe they'll ski a little bit more and then maybe they'll do opera ski have a beer or two hang out with friends and family and like some of those people just don't make it through the day And when you see that up close, you realize, wow, life is so short and you have to make the most of it.

26:15And in those moments when you're on the front lines helping that person, that's more fulfilling and rewarding than anything you can be doing at work or within a startup. So that perspective helped me kind of figure out where I want to spend my time next. But yeah, certainly I know many people that have sold companies and that are like, you know, I'm lost. I have no idea what I want to do with my life. So it's basically helping other people, saving other people that helped you find your purpose after that. Yeah, I would say it just gave me perspective on like what mattered and what was important.

26:52What I realized is that the perspective and what mattered was ultimately people, working with amazing people, helping people. And the best place to pursue that idea, at least in my mind, is to build a company. Because to do that successfully, you need to surround yourself with amazing people. And so that's just kind of like what I keep coming back to, which is, are there more businesses to build with amazing people? Because, again, it just makes the day-to-day more fun and rewarding. Servicing your customers as a business is less important for you personally than surrounding yourself with the right team.

27:28Well, I think you need to do both. I think it's impossible to service or acquire any customers unless you have a great team. So for me, it's like the priority and step one is team. And then when you have an amazing team, you can go out and kind of do anything. I think about an example I used to share, Troops, another company we started. I would tell people, think about the time when we went to the moon. We had no idea. It was somebody or someone's decided we should go to that thing in the sky. They had no idea how they had no team. That was the mission and vision. And from there, they got a bunch of smart people in the room.

28:03They gave them a bunch of resources and they're like, figure out how we're going to get there. And they made it happen. And I think that's kind of the point, which is if you have a mission and vision, you then need to assemble a team. You know, once you do that, then together you can figure out how to get to that goal or serve the customer's need or some of the product or service. That's beautiful. I love it. That's great. How would you define your purpose today? I'm still figuring it out. Um, but if I had to answer today, like literally today, um, the way I'm spending my time and my purpose is to try to create more businesses, product services that people will love in the world and find excitement and enjoyment from those things.

28:46I've realized that there are people better than me still out there suited to run and operate companies day to day, maybe, but they probably probably never done it before, or they've never done it as a CEO or as part of a C-suite or as part of a founding team, but they're ready or want to be ready. So for me, I'm really excited about meeting those potential founders and potential operators, partnering with them, and working with them to help build a company from scratch together and go through the zero to one stage, the one to 10, 10 to exit our IPO, because I've seen that playbook before. So for me, I find a lot of at least today and subject to change, we'll see.