How I Built a $1B Business – Cameo CEO Steven Galanis

0:00Hello everyone and welcome back to the show. We have a tremendous conversation for you today with Stephen Galanis, co-founder and CEO of Cameo. Yes, that Cameo, the marketplace where you can connect with creators, sports, with athletes, celebrities, all kinds of different influencers, icons, and have them send personalized messages either back to you or to a team member, a loved one. And people use Cameo to send happy birthday messages, thank you messages, congratulations messages. It's a wonderful platform for connecting people with the individuals that they follow, that have influenced their lives, who've done meaningful work.

0:45And building that business, while as Stephen will describe, Cameo had product market fit from very early on, was not without its major crises throughout its development. and we get into those. Dig deep on the leadership philosophy that Steven and his founding team have used to navigate those crises and what has consistently allowed them to bounce back and be one of the most successful marketplace businesses of our age. Wonderful, wonderful conversation. You are going to love it. If you're watching this on YouTube, please like the video, subscribe to the channel if you haven't already. If you're listening on Apple or Spotify, subscribe, leave a rating and review.

1:29It's incredibly meaningful to me. It's telling those platforms that more people should watch the show and it helps connect us with more audience members, helps us grow the show. And then if you have questions, comments, et cetera, YouTube is where we capture those and we pull off those questions in future episodes when we do our Q &A show. So I love you guys for being here. Love you for listening to the show. With that, let's get on to this absolutely tremendous conversation with Stephen Galanis.

2:03In a crude laboratory in the basement of his home.

2:20Steven, it's great to have you on the show, man. I appreciate you making the time. Thanks for having me. Yeah, there's a part super early in your story that I'm interested in because I think it's something that happens to a lot of entrepreneurs. And I just want to take you back. Like in college, you start this Spartan Entertainment. You're building this big community. You know, so far as I think I saw that you're nicknamed the mayor and all this kind of stuff, which is awesome. So very entrepreneurial. And then your first job out of college is actually kind of going back into the corporate world, right?

2:51Like a trader for large finance. I'm interested in, because I see this a lot in entrepreneurs' journeys, where early in life or college, they have this pull to build their own business. And it's almost like we have to try the other side. Like, was it like a feeling like you needed to try corporate life? Or, like, why not roll your kind of entrepreneurial spirit right into an entrepreneurial endeavor right out of college? Yeah, that's a great question. And I'm happy you asked that, you know, one thing I know a lot of you that are listening, you know, probably can empathize with, you know, the entrepreneur that was, you know, finding every excuse to be entrepreneurial even before college was over or while it was going on.

3:32I can't tell you how many successful founders I know that were running the nightlife at their school. And, you know, I think it is a very similar skill set. But in my particular case, I had built the moat of my business in college, which had gotten really big. And there's a little background. So Spartan Entertainment was a company I started with my co-founder, Zach Maritas, who's now running a really successful software company in the Triangle in North Carolina called Teamworks. The two of us started this business where we used Facebook in the OG days. This is still when you needed a.edu email address to even get on Facebook to eventually aggregate a group of 17 ,000 college students at Duke, North Carolina, NC State, Elon, and the surrounding communities.

4:19This became the dominant force in nightlife in that area. In that generation, by my senior year, we were throwing 17 recurring events a week. I'm getting paid cash every single time somebody's coming in the door. It was a great business, but what ended up happening was right at that point, because I was the first grade that had Facebook all through college, eventually once people started graduating, they needed to get rid of the.edu limitations. So they ended up opening it up, and then suddenly the bar owners and the venue owners, anybody could kind of create Facebook events. It didn't just have to be college students.

4:54So we kind of lost our edge, if that makes sense. That said, the network that we built was pretty enduring. In fact, the signature party that we started Wednesday night, beer pong at Shooters still goes on today. And I'm about to have my 15th year reunion. So this thing is going about almost 20 years strong now, you know, which is which is pretty funny. But, you know, really to answer your question, like I think you also have to go back to that time period. I graduated in 2010, which was right in the middle of the financial crisis. So, you know, you could imagine that, you know, maybe if I graduate three years earlier or three years later, you know, you're, you know, sophomore year, junior year, you're interning on Wall Street or at a consulting firm, and then you're going to go work there.

5:36And, you know, there was this whole cohort of people that were walking around Duke at that time that like maybe otherwise would have been at a Goldman or maybe otherwise would have been at a McKinsey that ended up starting companies like Coinbase and Plaid and Airtable. You know, these are guys that were like all the same age, you know, as me in that cohort from Duke in that era was pretty incredible about the talent and founders that came out of it. But, you know, one thing that like I feel really confident about is like the time that I spent, you know, both trading and at LinkedIn were things that really did shape me professionally.

6:11Now, I think in both cases, I probably, especially trading, if I'd done two years of it versus, you know, five years of it, you know, I would have been better off. But at the same time, like, I don't have regrets because I learned a lot. I've made a lot of the connections that ended up, you know, being those that were my early investors or early employees of the company. So I don't have any regrets. But, you know, I do tell people that I always knew I was going to start a company. It just took me like nine years to find my like a really good idea. Yeah. I actually, you know, when I'm talking to younger people or, you know, whatever come up and whenever you have a public platform like this, people seem to assume that you like have all these answers.

6:51And, you know, sometimes you do, sometimes you don't. So I'll get questions asked and stuff. And I'll tell them, look, I think for some people, and probably my guess would be the majority of people, actually taking that time, if you have an entrepreneurial bent or that is ultimately your goal, taking that time to go into the corporate world in some capacity and getting a feel for that side of business. Because there are a lot of really good lessons that you can learn. And also, you can learn a lot of things that you don't like. And I find that my most successful entrepreneurial endeavor was actually the result of building, I'm not going to say solely, but building against aspects of the business that I didn't like or I disagreed with and then building off of those.

7:39And I wouldn't have had that if I hadn't spent about a decade of my life in different kind of corporate endeavors. Does that play with you? Does that sound right? And maybe what should someone be considering if they have a similar entrepreneurial bent that you have when they're coming out? Like, how do you make that decision? Should I just press into more entrepreneur or whatever? Let's start from the top on this. Yeah, yeah, yeah, yeah, yeah. I'm a deep believer that entrepreneurs are born not made. I think you can become more entrepreneurial by being, you know, hanging, working at startups or being around other entrepreneurs.

8:12But, you know, most entrepreneurs that I know, like they, you know, they were entrepreneurs in kindergarten. Like it was like, you know, they were the ones with the lemonade stand or they were, you know, flipping baseball cards or pogs or like whatever the fuck it was. Yeah. Pogs. Oh, my God. Like I just I just see that over and over and over again. And, you know, in fact, there's a personality test we used to make everybody take in the OG days of cameo. It's called 16 personalities dot com. And in only three percent of the human of the population has what's called the entrepreneurial archetype.

8:47And, you know, this is someone that's like forward looking. It's someone that's not deterred by failure. They're resilient. And those are just skills that are like absolutely needed 100%. Now, one thing that I'll tell you is that entrepreneurs can be fostered by being around other entrepreneurs. And one thing that we've done and I take a lot of credit and I take a lot of pride in is we have always like openly wanted to hire like future founders, like people that know they want to be an entrepreneur. They like want to get their feet wet. And I think there's probably over 10 people that have left Cameo over the years to become, you know, venture backed CEOs, including two that became unicorns.

9:26right? Which is, which is something, you know, I like, I'm a college sports fan. I love thinking about like coaching trees and, and, you know, like the CEO tree and the alumni tree at Cameo has, has really spawned some incredible founders that have, that have come through and, and, you know, trying to do things from pet insurance to NFTs to, you know, marketplace for art or, you know, different things in the creator economy. So like we've kind of run the gamut, but, you know, I think that's super important. And then the last thing that I'll mention is that if you are an entrepreneur and you know eventually you're going to start a company, but I really would say this is true for anybody in any job.

10:06It's critically important to find the thing that's your ikigai. This is a Japanese philosophy that I really love. For those of you not familiar, imagine a Venn diagram with four circles instead of two. and basically you're trying to find the intersection of what are you great at? What do you love to do? What does the world need? And what can you get paid for? And if you find the intersection of those four things, you kind of get what I call like the Iron Man heart, right? It's like that perpetual motion machine. It keeps you going through the good times, through the bad times. You could have the best ride up ever, but that doesn't mean the come down is gonna be anything but rocky.

10:44But like 99.9 % entrepreneurs go through major, major adversity at some period. And, you know, sometimes the sector that you're in is the hottest thing in the world. And then other times, you know, nobody wants to touch you with the 10 foot pole, especially on the venture side. So ultimately the way that I've always looked at it is if you find the thing that is your key guy point, it allows you to keep going on regardless of what's going on around you. And then the last thing that I think is really important, and this is, you know, when you asked me the first question, Ryan, like, do I regret, you know, being in the professional world versus being an entrepreneur?

11:20As long as you're learning, you don't regret it. Right. But the big thing is like, I see too often and I've been guilty of this myself. Like I mentioned, Hey, maybe if I had just done two years of trading, I kind of got what I needed out of that. And I would have been ready for the next thing, but I stayed for five. Right. And ultimately, I think, I think that's so important, whether you're in a role and thinking about a promotion or at a company, should I stay? Should I leave? Are you learning? Are you growing? And if you're not, you should find something else. Yeah, I completely agree with that.

11:51I also think one, just to build on top of that idea, even if you're at a job that's not your dream job or maybe you aren't necessarily, you know, it's not your ikigai, I think oftentimes we then down throttle how much effort we put into it, right? We're like, oh, well, I'm, you know, an administrator in this company and it's not what I want to do. I want to be over here. And then we spend half our day memorizing baseball stats because we can do our job in the first hour, right? I mean, that was like my career at American Express. And, you know, so it's like, I'll ask people, you know, yeah, I get it.

12:27Like, you don't love this thing, no doubt. But like, are you giving 100 % to it to even see like what you're capable of? And I think a lot of times we get into these positions. And if it's not what we see ourselves doing for 10 years, we downshift and coast. And that just kills all our momentum. Totally. And that's really what the whole premise of the key guy, you know, framework means to say, like, if you found that thing, then you are going to put the time and the effort because you love it, you're great at it. You know, you're, you're inspired by it, like all those things, like you can get, you can make money doing it, right?

12:57That's, it's so important. Yeah. Now, do you think I want to go back and double click on this idea of, of you having multiple successful startup founders coming out of your culture. And I saw that you have six core values. I'm going to read all of them, but there's three I would love for you to kind of expand upon. But I'm going to read all six for the audience quick here. Number one, roll out the red carpet. Two, act like an owner. Three, challenge assumptions. Four, embrace innovation. Five, fight for simplicity. And six, make it memorable. Three, I would love for you to maybe expand upon in whatever way you see works.

13:33because I think they're topics that to me are kind of a little different and I think very interesting are one, roll out the red carpet, two, act like an owner, and three, fight for simplicity. Those three ideas immediately caught me as differentiators from what I've seen in other kind of corporate core values. Well, I will tell you that those are the three that have stood the test of time. The other core values have been altered at different points, but those three along with run through walls, which is no longer a core value but still like very much an ethos of Cameo, are really the pillars upon which we built the company.

14:09So the thing that's kind of cool, I mentioned there were like four kind of OG core values at Cameo. We have six now, but each one of the founders, and then Arthur Leopold, who was our first employee founding COO, each one of us had kind of a value that we brought to the table that became the bedrock and foundation of our culture. So starting with, you know, fight for simplicity, starting with roll out the red carpet, that was the one that came from me. Like the whole idea with roll out the red carpet is any single person that interacts with our brand, whether they're trying to interview for a job or they're a talent on the platform or a customer, like the way that they should feel after interacting with Cameo is like they were just escorted down the red carpet at the Oscars and like they're the star of the show and you know the red velvet rope is there and everyone they want to meet behind it and and like we're lifting that red velvet rope up and introducing them to everyone they ever wanted to meet like that is us to a t and you know when we think about that from an employer employee perspective you know we always talk about like your first day at cameo should be the best day of work you've ever had in your life and then your second day should be better than the first and like that's such a ingrained part of our ethos and when we think about things like roll up like the return to office policy that we just did.

15:26You know, we're giving a$10 ,000 raise to all of our Chicagoland employees to come do that. We lived up to our value of roll out the red carpet there, right? Like, I don't know of another company on the planet that's doing that. I totally think that people were asking more out of them if they have to come in and their peers don't. So like, why should we not compensate them for that and do that in a really generous way? So roll out the red carpet, number one. Number two, act like an owner is actually one that was a LinkedIn value. I worked at LinkedIn right before, so did Arthur. And this was one that we stole, but we really liked.

16:02It's this idea that every single person, like you mentioned earlier, being in that role, but you don't really love it. So you're remembering baseball cards. If you act like an owner, you're the CEO. If you're the janitor or you're the COO of the company, you're going to act like a CEO for your role. And we really believe in that. And, you know, part of, you know, part of putting our money where our mouth is, like every single employee at the company has options in the company. So like, literally, they are an owner. I've always felt that that was really important. And on top of that, it's just this whole idea of like, you know, like, for the owner, the job's never done, right?

16:41So it's like, you know, you're never just going to go say this is good enough, like you should really own your work and feel like you're named the, you know, Stephen Glanis to the Ryan Hanley, like, you know, money back guarantee is like stamped onto the work that you're doing. Fight for simplicity is a really interesting one that came from Devin, our co-founder. Devin ran product and engineering for most of Cameo's history. Today, he kind of oversees like all creative and runs design. And the idea with fight for simplicity is to build something like globally scalable. It is so hard to do that if you have like all this complexity, like different buttons, different skews, etc.

17:23So what we're always trying to do is like, you know, how do we delete? How do we streamline? How do we make this as easy as possible? Because if you make it as easy as possible, it actually allows it to scale. And, you know, fighting for simplicity often means like, you know, very difficult tradeoffs. But, you know, cutting it all the way down and that's something that I think that, you know, we're pretty proud of as far as like the core product that we built, like what the whole universe of things we could have done was. But like focusing for, you know, we're nine years into like this personalized video product.

17:57How do you do you have a framework or maybe just maybe just maybe expand on the philosophy a little more? Because I think a lot of people struggle with this. I think they struggle with it with all their work. creators struggle with this entrepreneurs struggle with this i think we all want to add in features or like like you know complexity into the product as as a show of value and it is a very difficult i think conversation oftentimes to stay focused on this idea of simplicity so like how do you cultivate that inside the company and really stay on target well of course we want good ideas coming coming to get surfaced right and you know it's funny i was in a product review yesterday for this product called Broadcast DMs that we're rolling out.

18:41And one of the ideas that we had, so imagine an algorithmic with social feed. So basically, if you follow, anyone that follows you on Cameo Ryan, you could send them a mass message that appears in a one-to-one DM thread and start having a personal conversation with them. So we're really excited about that. One of the killer features we're thinking about is the ability for the talent to actually own, not rent their audience. So right now, like you're following on Instagram, you're following on Facebook, you're following on Twitch or YouTube, like the platforms own your followers. You just kind of rent them.

19:13But like, what if like we actually gave you like radical ownership and you could take anyone that followed you and export, you know, export their, you know, their, their email or their phone number, their birthday to a CSV and like use that in whatever direct to fan rails you, you think is best to go cultivate your network. So we were talking about this yesterday and we were really thinking about, okay, if we were to do this, what are the critical things of information? You want the name. You want the email. You want the phone number. You want the zip code. You want their birthday. But do you really need email and phone number?

19:50So it's just constantly because every time there's another field, you're going to have drop-off. So, you know, we ended up getting to a really elegant solution where, you know, three of those six things that we said were critical are like what we decided to move with in an MVP. And then later you can always add more information on or complete your profile in a deeper way. Have you had any, that's not the right way to ask the question. This idea of radical ownership of your audience is so much different than most platforms as you just described. Like, why are you willing to do that when your peer kind of social platforms are unwilling to do that?

20:28What is the thought there? And are you, you know, what would be the concern of other platforms not to do this? Well, number one, the business model. Our business model is really different from TikTok and Instagram and Snapchat. We do not have an ad-based revenue model. So for those platforms, they monetize on DAUs, MAUs, and basically selling their user data. The talent or the creators make the content for free, and then they sell ads against it to advertisers. So they are always going to be an advertiser-centric model. And the talent are – the deal they basically make with the talent is, hey, use our platform.

21:07You're going to get famous, but then we're going to sell. And if you get really famous, you can make money doing other shit. Like that's basically how it works is the, the red share that comes from any, like any of that on TikTok or YouTube. It's, it's, it does not, you cannot support yourself unless you are like the biggest person in the world on the platform. So that's kind of the, so then what happens? Like you sell merch, you go on Cameo, you, you know, have a subscription on Patreon or OnlyFans. Like that's how you monetize. For us, the talent are the Fort Knox, right? Like our business model has always been talent centric.

21:39Like the talent make more money than we do for everything. so for us if we can provide the best tools in the world the best rails in the world for talent to directly monetize their fan base and nurture it and cultivate it and strengthen it then like i think we win in the long term but it's impossible to go from you know a tiktok or youtube business model where you know they have you know 100 gross margins basically on this ad product and they don't have to give anything to the talent or they give almost nothing versus our model where the town are making 75 % to begin with. Yeah. Yeah. I get that.

22:13It's, and it's also, it's, it's such a direct relationship as well. And so personal, I mean, that, that to me, it definitely changes that aspect of it. And, you know, I guess I want to, I want to pivot into, and maybe this is the right time. This is the wrong time, but I'm, I'm so intrigued by the Brett Favre story and not, You can do any kind of just preamble into how it happened. I'm not so interested in the how. I'm interested in your mindset and philosophy to actually execute and to go see him. And then, you know, tell that story for us. Because, you know, the thing that happened, whatever, the controversy, that's less interesting to me, but probably important.

22:56But to then go and do what you did, I was like, this is the kind of guy that if I did want to work for somebody, this is the kind of thing that I would want to see out of the person that I work for. So I, I love that story. Well, thank you. I appreciate that. Let's take it all the way back. This is December, 2018. We're right in the middle of Christmas season, which is our busiest time of the year. I think literally this was like Thanksgiving weekend. Uh, Brett Favre had joined cameo earlier that year. And at this point is, is the biggest person on the platform, you know like an American legend and like hall famer and you know just getting a bread on had really started to be a halo for us to get you know Snoop Dogg and other like you know that kind of level talent onto the platform so that we're really just hitting kind of this big tipping point at that point we had closed our series a you know maybe six months before and all of a sudden we get a actually I think we call close the series a like like weeks six weeks before this happened And all of a sudden, I get a frantic text message from this guy named Sean Finnegan, who was extremely important to us in building this business.

24:05And Sean was working with Brett on a lot of his social stuff. And he goes, Stephen, we got a problem. And I go, what happened? Some alt-right group had tricked Brett Favre into making a dog whistle anti-Semitic video where basically the script said something like he was talking about, you know, of the shout out goes to the families of the USS Liberty, which was this ship that Israel bombed of the U.S. in like 1970s. It's like a very like esoteric reference in history. And Brett just thought he was doing the shout out for, you know, basically for he thought he was doing a shout out for veterans.

24:42And then this group took that and put it on 4chan and they'd made a bunch of little dog whistle references that I wouldn't have caught or I don't think anybody reasonably would it caught and suddenly you know they were making it look like brett was you know advocating for these you know like these proud boy like groups like these alt-right kind of neo-nazi type groups and this became like a massive massive story and you know first things first we always want to make sure our talent's safe as i mentioned like the talent are our fort knox without the talent we can't do what we do we can't manufacture happiness so the biggest fear at that point was holy shit If like Brett loses his Wrangler jeans ad or, you know, and he leaves the platform and he never comes back, that will put a cap on whoever could go and join Cameo because suddenly he becomes the cautionary tale.

25:34And every single agent is going to be like, yeah, not worth it. I don't care how much you make. You just threw everything else away. So this is really existential at the time. And so what we immediately do is we kind of let our talent base know that this happened. Like we were super transparent. We immediately built this kind of like early AI bot on Slack that would basically, you know, we went to the Southern Poverty Law Center and got this list of all these like hate words and different hate groups. And then it would basically flag, we called it Nazi bot at the time. It would basically flag anything and then let our talent team know, hey, there's something fishy about this request or this reference.