2370 - Why Building a Business Is Like Racing and How to Avoid Crashing with Beta Ventures' Ike Eze

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0:46Visit podverified.com if you'd like to be featured as a future guest. I'm Josh Elledge. Let's get into it. With us right now, it's Ike Eze. It's great to have you. You are the managing partner of Beta Ventures, found on the web at beta.ventures. And you're also the author of the book, The Founder Fit, Finding the Business Idea That's Right for You. Ike, it's great to have you. Great to be on your show, Josh. Thanks for having me. For sure. And before we start talking about your work in the world and your book, you always love hearing what multi-passionate leaders do for fun on the outside when they're not at work, particularly things like hobbies or things that you might be currently geeking out on.

1:37What have you been into lately? um actually uh formula one is my passion right now so uh formula one races um i went to school as an engineer so mechanical engineering love high performance cars wanted to work on them but haven't quite gotten to be able to work on one of those cars yet so i appreciate it from a distance we're hoping we can bring formula one to the african continent um in the next couple of years over in Rwanda. So looking forward to it. Really excited about that. I can imagine there would be a huge crowd there. I wanted to mention that my son is in his senior year in college as a mechanical engineer.

2:19My youngest son, he's a mechanical engineer. He's in his sophomore year. And trust me when I say they are both really into Formula One big time. Of course, I'm sure you've been asked this before. Or did you watch the movie F1 with Brad Pitt? Yes, I did. What did you think? I thought it was a good job, but I'm sure the Formula One guys that drive those cars are like, you know, it's not quite the real thing. But from the feedback that we've seen, it's that he actually, or the movie makers did a really good job of trying to emulate what happens in real life. Seeing that, by the way, I'd recommend if anyone who hasn't seen that movie, watch it on the biggest screen you can, the most immersive screen you can.

3:03We watched it on IMAX when it came out and that was quite a sensory experience. It was kind of a lot like how Top Gun Maverick felt, you know, where it was just very immersive that the camera work was really great. But yeah, I can imagine there's, you know, they have to Hollywood up, you know, some aspects of the, you know, the mechanics and so forth, you know, how the cars work. So I was actually watching a show once with some drivers and they that one of the things they get wrong is the thickness of their necks, that how thick their necks have to be to overcome the G-force that they have in taking those corners.

3:43So I started looking at their necks, and I was like, they are right, they have some pretty muscular necks. Well, Ike, tell me about your work, and before we get into the founder fit, tell me about your entrepreneurial work and your VC work. Sure. So as I said, I'm an engineer. So my first company was a tech company, Silicon Valley. So sort of venture funded that, built that, sold it, did it like three times, and then hopped over to the other side to become a venture capitalist because really wanted to help entrepreneurs sort of get their ideas to fruition. So really enjoyed doing that. Decided to focus on emerging markets because it's a huge gap.

4:26If you look at Silicon Valley, there are lots of investors in Silicon Valley right now, but not as many that have built companies that are focused on emerging markets. So really love watching entrepreneurs sort of take something from just an idea, a kernel, and building some amazing companies out there. Well, and then obviously you have, well, I'd love to hear your take on what's going on in Africa right now, because obviously that's a lot of the advocacy work that you've been doing or, you know, kind of the evangelist work I'd say that you're doing. Give us, you know, for someone that hasn't been paying attention, what is the opportunity in the African continent right now?

5:11So what we are seeing, it's so appropriate that you asked that question when we had a power cut.

5:24So Josh, your timing is impeccable. So what we are seeing is that we are seeing greater infrastructure that is being built here. Some people forget that Silicon Valley was not built in a day. When I started my first company, it was in 1997. So what we had then is very different from what we see now. And there were ecosystems that were built around that. So it took a lot of time. So looking at what we have on the African continent, it's very much reminiscent of the birth of the dot-com era when things were emerging and ecosystems were being built. But the difference is the speed with which a lot of these are being built.

6:09So when I started investing in this market about 10, 12 years ago, people were still duplicating ideas from the West. Now we're seeing people creating ideas for the continent, and we're seeing the minting of unicorns a lot faster now. So we are seeing billion-dollar companies that are emerging. And I think it's because people have finally dialed in the idea to the market and the opportunity. The ecosystems are being built. And it's a fantastic time to be investing in this space and this time. So specifically with Beta Ventures, share a little bit about the work and the investments that you've made.

6:47So we invest early stage. We invested seed. So typically after entrepreneurs have taken their product to market. One of the companies we invested in about eight years ago is a company called Smile ID. Now, the challenge is we're looking at pictures or faces for ID recognition. And if you look at the different algorithms that were created for this, that were either created by Amazon or Google, they're optimized for faces that are more European. Yeah. So you were getting a good 98, 99 % match rate. But when you turn to black and brown faces, the accuracy dropped to like 86%. So there was a young entrepreneur out in Oakland, California that said, this is a problem I'd like to tackle.

7:39And he sort of created the machine learning algorithms for facial recognition of black and brown faces around the world. And he launched it in East Africa. We invested, brought it across to the continent, did a fantastic job across the continent. We recently raised a strategic round from MasterCard, came in as a strategic investor a couple of months ago. So really excited about that company and what it's going to do next. But those are the kinds of problems that we are seeing that people are solving. There are gaps that we see in opportunities and entrepreneurs being able to fill those gaps. I love that.

8:21Well, Ike, let's talk about your book, The Founder Fit. Who is it written for and what is the transformation that you'd love to see in the reader? I think it's written for the entrepreneur that is starting out, as well as the entrepreneur that has gone a fair distance and might not know why things aren't working out the way he or she thought they should be working out. And the premise is that most people start out thinking an idea is a good idea. Now, the downside of that is that if you don't do it well, then you're a bad person. The reality is that the idea should really fit the person that is trying to execute the idea.

9:07So if it's a sales idea and you have no sales background, it might be a mismatch for you. And that's an early sign of being able to figure out if these ideas ideally fit to the kind of person you are or the outlook that you have or the things that interest you. And if you can get a better match up front, then you'll find out that the outcomes greatly increase in your favor. And there might be some people that are toiling away at an idea for three, four years, and they're trying to figure out why isn't that working? Well, it might be working because it might not be working because it's just not the right fit for you.

9:44So it allows them to go through very simple steps to identify the right fit. Why is this so critical that there is a fit between the founder and what otherwise might be a great solution? They're just not the right person to lead this solution, maybe. I guess the question I really want to ask, so I want to know what the consequences are. And then secondly, or if you want to weave this in, how might we know that we are in the wrong company? so so let's start out with why it might be a good thing to figure out um building a company is tough it's it's hard work and there are days that you sit back and you're asking yourself should i be doing this um and you'll find that the people that find the right fit rarely asks themselves that question they just know that it's a dip we're going to get through the dip because i believe in the market.

10:43I can see it. I know I can execute it and so on. So I think that's the first. The second is that the outcomes of people that are fit to the right idea are significantly larger than people that just waltz into an idea, worked on it, and it kind of turned out okay, but it didn't turn out as amazingly as it could. So the example I give here is, imagine Facebook being run by the Winklevoss twins versus Mark Zuckerberg. I have a feeling that that company would have made it to a$100 million company. There would have been an option to buy it. They would have sold it. And the Facebook of then would never be the Facebook, the meta of now.

11:27So that is just an example of how an idea was really fit to the right founder. And that person being able to elevate the idea, extend it, and do so much more with it. because intrinsically it fit them more. Yeah, I absolutely. And so I guess the part of my question now is we might be at the helm of a company that we created and there might be this tension that continues to persist. What do we do? If we find ourselves, oh, I think I started the wrong company. No, I think it's one of those things that's really great. if you internalize that question because it puts you on the right path. So what I would say is step one, just analyze what it is you're trying to do for yourself.

12:20As in, am I trying to build a lifestyle business? Am I trying to build like that earth shattering business? And then evaluating your skillsets against that and saying, do my skillsets, let's just say, for instance, you want to build the most technologically advanced AI company because that's what you're here is hot. And then you look at your skill set and you are more a marketer at heart. Well, you might not be doing that. That might not be you. But once you've identified where those gaps are, now is a chance for you to fill it. So are you filling the gaps with people? Are you filling the gaps with resources?

13:00Are you filling the gaps with retooling yourself? And if you can fill those gaps, then you can move that business to the next level. So it's not just for people that are thinking about what are they going to build at the onset. It's also for people that are looking to recalibrate because they have hit a bump in the road and they need to figure out if that makes sense. Yeah. Well, Ike, so the book, The Founder Fit, where it's obviously it's on Amazon. You can search for it. It's hardcover. It's called The Founder Fit, Finding the Business Idea That's Right for You. We have a link, direct link to it.

13:36You also have it in paperback and Kindle. Thank you so much for those of us who are avid e-readers. And so, Ike, how else might people engage with you or follow you? I know you have a really great LinkedIn following as well. Yeah, most people follow me on LinkedIn or they subscribe to my newsletter, PlayingPoint. And it just is, I call it musings of an emerging market VC. So every week I just post something. It's free of charge, so you can sign up for it. It's on Substack, but playingpoint.substack.com. or I'm on LinkedIn. So just find me on LinkedIn, Ike Eze on LinkedIn. Awesome. We have all those links, by the way, in the show notes for this episode.

14:29Ike Eze, thank you so much. Your book is The Founder Fit and it is finding the business idea that's right for you. Listen to my friends that are founders and I don't know, maybe you're stagnating a bit. Maybe you're really frustrated. and maybe you're starting to resent coming to work, you might want to evaluate where you're at. And Ike, I think a lot of what I'm sharing is quite good historically at what I do, but we launched a new venture, PodVerified. And I mean, that is why I'm on the earth today. And as a result, I'll just edify your work and your philosophy here, it's 10 times easier for me to be the founder of this company.

15:23It's like when everything aligns, I agree with you. It just, it is so much, it's still hard work. It's a lot of work, but it just feels like things just flow so much easier, not constantly battling uphill. So I'd encourage folks - And doesn't it make sense when you wake up in the morning, you just say to yourself, I know what I'm going to be doing. I don't have to really force myself, but you trudge into work and you get it done. But it helps when you really like it and you're matched. I love it. All right. Ike, thank you so much for joining us, beta.ventures. And of course your sub stack and LinkedIn are all in the show notes.

16:04Thank you, Ike, for joining us. All right, Josh. Great to be there.

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