Lisa:
Welcome, everyone. This is Lisa Calhoun and I am so excited to introduce our keynote for Startup Runway. He is one of my favorite, not just Atlanta founders, but founders period. He is the CEO and Founder of Lease Query, an Atlanta FinTech company and Valor is proud to be an early investor. Welcome, George. Glad to have you here.
George Azih:
Thank you so much for having me, Lisa. I appreciate it.
Lisa:
So, we’re going to go through a little bit of your founder’s story, and I want to bring everyone right to the beginning. When did you know you’re an entrepreneur?
George Azih:
Oh, well, that’s an interesting question because I didn’t really think of- I think there’s a lot of misconceptions, so to speak. Everyone wants to be an entrepreneur, right? I wanted to start a business. That was my fate, my thinking. I wanted to, I mean, not even start a business, I just wanted to solve a problem. I think it’s more what I set out to do, was to solve a problem that I had. I got the idea for Lease Query in in March 2010. That was where I had the idea, because I faced a problem. And the first line of code was not written until September 2011. So, between March 2010 and September 2011, what I did was really, really understand the problem and become an expert on accounting because it’s an accounting product. Become an expert in accounting, and that was very important to me because it gave me credibility. Because if I showed it, I really understood the problem, then this- it’ll be a natural step for prospects for potential clients to say, “Okay, since you really understand the problem, what’s your solution?” And if I spend nine hours talking about the problem, I only need to spend 30 minutes talking about a solution as long as I develop credibility during that nine hour period, then it’s a lot easier for them to accept whatever solution I presented.
Lisa:
So, why did you want to solve the problem of lease accounting?
George Azih:
Well, because it was a problem that I had in my previous life, prior to Lease Query. I was [on] technical accounting and accounting research at a Fortune 500 company here in Atlanta, and which meant a big part of my job was figuring out, what are the new accounting pronouncements that the boards were considering? And, how do we, as the company, structure our contracts and our arrangements to get our preferred accounting treatment. So that was my job. However, I also had some other small roles that I played in the financial close process and one of those roles was lease accounting. This was one out of maybe 30 tasks that I had to do, but it would take me 80% of the time. It was awful. Something else that happened during that period was the company I was working for changed auditors, they switched auditors from PwC or anything on. So, this was Arsene Young’s first year on the job and as a result, they decided to take a deeper dive into the financials and one of the areas they looked at was leases. And they test the 10 out elite 10 of those leases and 10 out of 10 of them are wrong. They tested another 10 and 10 out of 10 of those were wrong. So, at this point where zero out of 20 and, and so the chief accounting officer, she tasked me with teaching all the controllers. This is a global corporation, so she tasked me with teaching all the controllers how to account for leases. So, my thinking was well, right now we’re getting it wrong. And as I said, in my role, there was accounting research and technical accounting. So, I knew that the boards, the FasB, the governing boards for accounting in the United States, were considering changing the rules and making it more complex. So, I’m sitting there and I’m like, “Here we are, when it’s easy and we’re not getting it right. So down the line, when it becomes harder, it’s gonna be a big headache for companies.” And so, I decided that at that point, there needed to be a solution in the marketplace and decided to build them.
Lisa:
So, you decided to build it. Did you imagine, a huge company, wonderful office space and terraces, hundreds of employees? Where’s your head?
George Azih:
I honestly thought, success for me at the time, was making $350,000. That was my number, so to speak, $350,000 a year and with five or so people at the company that was what I sold to, a first employee. And that’s it seems like a very, very nice lifestyle. And that, I think that’s why that distinction is important. I’m starting a business or solving a problem versus starting a business. I think that distinction is important because if you’re really, really obsessed about the problem, which is I have an obsession over lease accounting. If you’re obsessed about the problem, then you can’t help but want to solve it and solve it well. But, if your focus is on building a business and the best business, you possibly can then, I think there’s some shortcuts that you make. I think anyway, that’s my interpretation. I look at my competitors right now and I know they saw an opportunity. They went out to try to grow their companies on this opportunity and it’s routined me, day and night our product or customer service versus them. That’s because we really focus on the problem. So I think that distinction is a very important one, you have to be obsessed with the problem yourself.
Lisa:
So, how did you make the leap from solving the problem for the large Fortune 100 company you were working for and make the leap into solving it for the hundreds of clients you have today? Because that is a leap and to some extent, you could have perhaps been satisfied with providing for your employer and doing a great job.
George Azih:
Well, the employer did not appreciate what I was doing. They told me to stop working on this. And, focus elsewhere, I mean, which I can’t blame them.
Lisa:
But, you were attest with this problem.
George Azih:
Exactly, I was hired to do a job there. And, yet here I am trying to solve a problem which was not it was- it was important at the time, but it wasn’t urgent. And most large companies focus on urgent problems, right things, headaches, solving that problem now, and then they move on. And they’re not thinking of, being the best at solving that problem. So, I’m not trying to disparage them or anything, but yeah, I mean, there wasn’t a fit there. So, I had to kind of do it on a side.
Lisa:
So, do it on the side. There’s a long tradition of great art first doing that. How did you know when to make the transition to “now I’m on my own”?
George Azih:
Okay. So as far as the timelines are concerned, I got the idea in March 2010. The first line of code was written September 2011. Got our first check, which actually I havehere with me. Our first check, as you can see, it was for a $500 from a company in Atlantic called Fresh To Order, that check is dated 12/13/13. And, I did not quit my full time job until 2015.
Lisa:
Awesome! You see, I think that is often misunderstood about founders that they just kind of spring from the forehead of Zeus or something fully formed with their CTO. I think a lot of people can relate, I know I can relate to that story that you’re telling. I was working a job for a couple of years before I stepped out fully on my own and collecting checks from customers and passing them on to my employees, while holding down a nut, it would make things make sense. So, how did you get it coded? Because again, the startup world, it’s like, you have to find your technical co founder. That’s job number 2 after the problem. How did you address that?
George Azih:
Well, I’m not technical at all. I still to this day, don’t know how to evaluate technical talent, frankly speaking, so that put me at a distinct disadvantage. I talked to a couple of people to try to get them on board and, first of all, the cost was exorbitant. And it would only take me part of the way there. What I did, that eventually was very- I was lucky- was my brother, who’s also- he’s now, this is not my first venture, my brother and I started a company prior to this and we learned a couple of lessons along the way. And, one of one of the lessons- one of the things that he learned and he told me was, rather than get a person to build the first prototype, get a company, outsource it to a company. That way, if whoever’s working the product isn’t doing their job correctly, then you can scream at their boss and then their boss screams at- like the person has to understand that this is their job as opposed to someone who could see it as a gig or see it as a favor, even if you’re paying them. Because you’re probably not going to be able to afford paying them market rates. So, that was the best advice I received. And I hired a consulting company to help me build The MVP and there were times where I’d have to scream at, I assume is the CEO, the COO. And he would now turn it around and talk to Mahesh, who was the gentleman on programming in Iran and ironically, we hired Mahesh. Mahesh is still with the company today, the first programmer that built it. So, I believe that really, really worked in our favor, was doing it that way.
Lisa:
So, another thing I hear from founders a lot as well. It’s not just about hiring the developer. Once I hired the developer, the developer tells me that I need to have proper requirements.
George Azih:
Yes.
Lisa:
Tell me, how do you address that?
George Azih:
I did that way, before I hired- the first line of code was written. That’s what as I said, got the company idea in 2010, March 2010. From March 2010 through September 2011, I was working on the requirements. It was hundreds of thousands of lines and Excel spreadsheets, where I would say step one, step two, step three, in red, and then notes in note one, note two, note three in blue. That way, the programmer understood. I always say this, you do not want your programmers to think. I mean, it’s for sorry, I apologize to anybody who’s a programmer out there, but you do not want them to think, you want to be as straightforward, and literally, there’s no question and I will tell you an example. When we first built the MVP, I said “Okay, there has to be a login.” And he was like, “Okay, there’s a login.” So I came in one time to, obviously, review the work that had been done. And there’s a login, name, login, email address and password and there’s no button for forgot password. And I reached out to him like, “Hey, why isn’t there a button for forgot passwords?”, “Well, you didn’t tell us to and you told me to strictly follow exactly what I said.” And I was like, “You’re absolutely right. That is my fault”. And, adding that forgot password was an extra fee, because it wasn’t booked. So, you have to be as explicit as humanly possible, because in the long run, it’ll save you money. Because any changes from that is that would be an extra fee. So, you don’t want them spinning their wheels because they will bill you for that. So, writing requirements, excellent requirements, it’s huge. There’s a book out there by Steve Krug, “Don’t Make Me Think“. It’s an older book, but I think it’s still true. It’s more of a design book, but I applied those principles also in programming.
Lisa:
So, when you started hiring your team, what were some of the big lessons learned are things that you say “Hey, if you’re talking to other founders serious Startup Runway, when they get to that point past requirements, past MVP, past customer number, maybe one, two and three, now they’re building their team.” What were some of the things that you wish you could have coached yourself on them, if anything?
George Azih:
Well, a) you can never make a judgment on an individual before 90 days. That is one thing that I have learned in hiring people. When they start a lot of times, they’ll start off really great. They go by, “oh my god, this person is great, this person is great.” And, all of a sudden, they don’t end up being great. So, I never have good or bad feedback. I mean, obviously I’ll give feedback, but I’ll never make a judgment call on someone prior to 90 days. That is one thing I have absolutely learned here. B) Something else I’ve learned is, I let my people manage. I let my managers manage, they make their own decisions. They- because if I don’t, then I can’t hold them accountable. If I say, “Hey, here’s what you need to do.” and they do it, and it doesn’t work, whose fault is that? Now, on the other hand, if I say, “Here’s the outcome I want. However you get it done, as long as you get it done with as long as you give me my outcome, then you’ve succeeded.” So, there are obviously areas where you kind of ride that in, in terms of culture, how you manage the people, that you manage things like that, but, I lead my managers. That’s something I learned pretty early on.
Lisa:
So, when you told me about Lease Query first getting started. You worked quite a bit remote, and we were talking recently with COVID that there’s some remote capacity in the DNA essentially at Lease Query. How do you feel about a co-working path office? All that you’ve learned in the past few years, how important do you feel the office is? And how do you see it functioning in the life of the software company?
George Azih:
Well, I think the challenge that I had prior to COVID, I was never able to work from home. Lease Query was started at Starbucks. If you come to our office now the video, you’ll see a timeline of Lease Query. And what you’ll see are pictures of us at Starbucks, because that’s where it [started]. Actually you’ll see a picture of Northside Hospital, of me holding my daughter’s- well, one of my daughters, I have twin daughters- and they were born at Northside hospital. And I have a picture of one of them, of both of them. I don’t need- the good thing is, I don’t know which one is in the picture. So when they ask, I can’t say, I really don’t know, it’s one of you. But I really don’t know. But that’s where the amortization schedule is built. My ex- I’m divorced now- my ex-wife was on bedrest from October 2011 through January 2012, when the kids were born. And so, we were living literally in Northside Hospital for those months and that’s where I was writing the requirements for the amortization schedule, which is literally what the square was built on. So, I remembered so that’s where the timeline begins. Northside Hospital to Starbucks and then from Starbucks to Barnes and Noble and then from Barnes and Noble to office space, etc. But I was never able to work from home, which is why I would go to Starbucks, and then from there to Barnes and Noble. And then all of a sudden, you’d need real quiet time to have phone calls, and it’ll be loud at both Starbucks or Barnes and Noble. So, we went to a place called Rome, which is kind of like a WeWork. I think it has a better model than WeWork, frankly speaking. And I did that because I needed a quiet place to work. The point is, when it comes to remote working, I’ve been forced to do that now at home because of COVID. But, I’ve always thought, at least you can- we travel right but not often. We did like to travel a lot. I had a requirement where everybody has to travel once at least once a month, because, you go out there, you’re face to face, it’s a lot harder for people to tell you know, how to do your face in sales. So, we would use that to our advantage for larger deals. But, we’re able to work remote now. I’m personally able to work remotely now, because there’s some lessons that I’ve learned, have a place where you work. A place where you say, “Okay, this is my workspace.” And that makes it easier as opposed to, in a dining room or in a bedroom, it could be in either of these places. But as long as it’s a designated place for you to open up your laptop and get work done, and fill out to the extent you can, I know it’s tough now with COVID for people with children, but block out the outside world, I think that makes it a lot easier.
Lisa:
So, what are some of the other things you feel like, “Oh, these are lessons I had to learn”, that maybe you’ve seen other people also need to learn and you can remove some pain by sharing anything around. How do you do your own accounting? How do you hire your C suite? You have some terrific salespeople, some terrific people in law working with you today. How did you attract the top notch talent that you have now?
George Azih:
Well, I’ll also go before the hiring. I think one big mistake I see a lot of entrepreneurs making, is they spend so much time on social media. Building their brand, and I use brand as air quotes here, because I know this is one thing I believe. And, I don’t want to be controversial here, but I believe that, you’re going to do one of two things. You’re either going to build your personal brand, or you’re going to build your company. Choose one, because it’s either you’re going to be on Twitter or Facebook, and all these things, building your brand and tweeting all the time. Or, you’re going to build a solid company where nobody knows who you are, but the people that you’re trying to sell, or trying to sell to, know you, know the good company. So, I would say that’s one big misconception that I see out is, a lot of people think social media is the cure-all bill. As long as I’m all over social media, that gives me exposure. Which could translate to sales? Not true. So, it’s more focusing on your- like writing an actual blog, those are hard. It’s easy to tweet but, write a blog that really speaks to your audience like something where you’re actually giving them value, true knowledge. Now, that’s probably easier for me, because once again, it’s accounting software. So, I know if I write a detailed accounting blog, and I better know what I’m talking about, so I have to really research it. But the thing is, now that I have that anybody who comes in and reads that blog, and spends, five minutes on that blog is a potential customer. And so it makes your path easier, as far as that’s concerned. So that’s- I’m sorry, I tend to ramble quite a bit.
Lisa:
Yeah!
George Azih:
One of the things I’ve learned is how to capture customers by really using marketing the right way. SEO.
Lisa:
So, true thought leadership, real expertise.
George Azih:
Correct.
Lisa:
Not dancing around the small stuff, but cutting right into the meat of it. And then once they’ve started to consume your content. What have you learned about hooking them into the actual product? Because there are people that seem to kick tires and read more and learn more and go to every webinar, it’s like a decision. How have you learned to pressurize the sales decision?
George Azih:
Well, I can’t remember, what article or book, I read where it said, “Do the things that don’t scale.” Do that that doesn’t scale. And, I think we did that. When I started Lease Query, I visited every single client for the first 15 clients we had. It was face to face, I went to them. I always joke. I had a 100% close rate for those guys. But every single person I went to, we closed. And I think it’s because I learned a lot during that period because I knew who they were, I knew the problem innately. So, going through the demo itself, was giving them examples, “You know when this happens? Well, here’s our solution to that.” “How do you have this problem, here’s a solution to that.” And you’re doing it to their face, and as I said, there’s something magical about that. When you see literally every head nodding in the room during the demo, and they go, “Oh, oh, yeah”. That’s part of that credibility. So, doing the things that don’t scale. My preferred airline, Southwest Airlines. Why? Because I could cancel at any time. Once, I set a demo. I call them and they said, “Hey, I’m about to, yes, we’re interested in seeing a demo.” I would celebrate that, that’s actually very important. Celebrating the small wins because that’s what keeps you going during the downtime, and you will have a lot of downtime. I would celebrate that and then a day or two later, I’ll call them or email them and say, “Hey, guess what, I’m actually going to be in Dallas for a meeting, why don’t we do this demo in person?” And they’ll always say yes, believe it or not, they will always say yes. “Sure, absolutely. Come over to the office.” Perfect, right there and then book a flight using Southwest and fly there. Sometimes they’ll cancel and then you cancel, but you get a credit on Southwest. So, I mean, doing things that don’t scale was important, also anticipating things. I just showed you our first check. I’ll tell you a story about what happened. When I got the demo, as I said I went in person and the night before, literally, four o’clock, I’m thinking through my head. “What are the things that could happen? What are the things that could happen?” I had an extra pair of an extra suit in the car just in case something happened. And then I thought to myself, “Oh my god, what if they don’t have a projector? Or the projector isn’t working?” So, I call my mom. I mean, I’m at this point, I’m broke. So, I call my mom and I’m like, “Mom, I need a projector.” “[What] you need a projector for?” And I go, “I have this- for the demo tomorrow. I need to be prepared in case they don’t have a projector.” And she goes, “Okay”, so she lived in Houston, she paid for it, went to BestBuy, pay for it using her credit card, and then I picked it up from the Best Buy here. So, I got it figured out how to use it, practiced it everything. And my meeting was literally at 8 AM the next morning. So, I get there and I have driven there like three times already just to make sure. I knew how to get there and knew where to park and everything, and got there. And it was, the lady was like, “Okay, that’s the conference room we’re going to be using. I said, perfect. I set up and she goes, “I have never been able to figure out how to work our projector, and our IT guy doesn’t get here until 9am.” And I was like, “Oh, that’s okay, I have a projector”, and the CEO was there. And he looked at me, he was like, “You actually have a projector with you?” “Well, yeah” very casually. I was like, “I’m always prepared”. And he was like, “Huh, interesting” and I honestly feel like that right there, so the deal.
Lisa:
Yeah, you right there.
George Azih:
Yeah, because he actually would leave the room and come back. He’s like, I’m a fly on the wall. Ignore me, ignore me, leave the room and come back. But I think that sense of approval to the controller that she could make the call and chose us. So, that’s me just anticipating those kinds of issues, I think that helped.
Lisa:
George, you are a master of hustle. So, [I know you have a] really, really busy day, I am really thrilled that you could share your wisdom because that is exactly what it is with Startup Runway because you’re building Lease Query now, but also so what I want you to do is pry will. Tell us about these queries today, tell us about those customers, tell us about your team. How’s it going?
George Azih
Well, the irony is it’s funny you say that brag today. When I was- when we were three people in a company, I would routinely say that I hate vanity metrics. And for me, vanity metrics are the number of employees that you have. How this is funny, it’s been so long since I’ve had to think about this. But, I had now, the number of employees was one, how big, how much revenue you had but even though that’s more of a close. I can really, oh your office space. Where’s your office? Those are vanity metrics that I really didn’t focus on. And I hate it when people ask me that question. What mattered to me were, what’s our close rate? How often do we beat out our competitors? And those were the numbers that I really, really embraced. So my point is, I’ve never really been used to bragging because I never really liked those metrics. But, I can tell you about the Lease Query. Where we’re about 200 employees now and revenues where we’re going to be at about $20 million ARR in terms of revenues. However, our cash collected is slightly different because we do three year contracts, so that’s probably gonna be, last year that was $30 million. So, is that good?
Lisa:
It’s really awesome. I love it.
George Azih:
I know you not what you wanted me to say.
Lisa:
No, that’s I think just giving people a sense of what’s possible with the kind of commitment dedication that you’re talking about, because I mean, George, you’re a very humble person. You’re a very humble person. And I think that when people hear you speak, your humility overshadows the achievement that you have created and are continuing to build. I call Lease Query a legend because I believe it is a known legend to a few people today and will be a legend to many people as you continue. So, I just wanted to get some of that out there. And now ask you..
George Azih:
Thank you for your kind words.
Lisa:
It’s easy, I was just the way I see it. So, how do you look at founders today because you and I occasionally talk about opportunities to invest. I’d love to get your take on founders the Valors looking at. And I’d love to know what you’re looking at. As a newly minted investor that has quite a few deals really when you think about it. What are you looking for in founders yourself on the other side of the table?
George Azih:
Well, honestly, I’m not gonna do that at all. I don’t think it’s too soon. But I think that’s why I rely on funds like yours, to help with that to help me navigate that because I frankly just don’t know. I will say I do look for companies that are similar, companies that are selling, a must-have versus a nice to have. Founders who have innate, just intense knowledge in the problem that they’re solving. I’ve spoken to quite a few people and you haven’t have a broad array of knowledge. And if you’re in a space and I asked you, “Do you know that this person in that space?”, and they say, no, that’s a problem. That’s usually an indicator that you haven’t really done your research. When people come and say, okay, I want advice, I tell them, there’s three books that I read that literally, the most important of which I believe is The Startup Owner’s Manual. It is a thick- very, very thick book. It’s a fun read. And, I read it at least once a year now. I mean, that’s how much, it is an excellent read. But it’s not an easy read. It’s not an easy read. And when people say, they want to talk to me and either mentor them, I tell them to read that book. And if they haven’t read it, then I know, because, I mean, that book literally helped me right to get to where I am because that’s why it said do “scratch and claw” one of the principles it says “Scratch and claw to get your first 10 customers.” Because once you get 10 customers, you can get 100, Once you get 100, you can get 1000. But those first 10 are very important. So, that’s where that’s okay, I am flying to every single potential meeting. That’s where I came from. That’s why I did that, I didn’t realize what I was doing at the time, but I just wanted to make sure I closed the deal. Because then that helps you with your next hundred. When people show me that this interest is right or that I’m not serious enough just to read a book that I’m telling you like really helped, then it’s like okay. I kind of just- there’s a lot of entrepreneurs. I mean, there’s nothing wrong once again- I said this earlier, there’s nothing wrong with building your brand. Your individual brand, that’s absolutely nothing wrong with that, please don’t, I’m not trying to dish brush here. At the end of the day, though, you have to decide. Do I want to build a company or do I want to build my brand? And there’s very, very big differences there.
Lisa:
Well, I think they took some notes. So, if you’re looking to George for an angel check, you know what to read. And you said there were three books though. Those are two. There’s always one, can you share the other two?
George Azih:
Well, Steve Krug, “Don’t Make Me Think” that’s more of a design book, but it tells you it’s about building intuitive. Your product has been intuitive. Use things that people already know and are used to. Don’t try to recreate the wheel. So, you’re on-off button for us on Lease Query looks like it- literally looks like Apple? When on or off Android really? On or off, but because people already know what that means, they know that. So, using those designs as elements of design, that work. The third one and this was actually more recent, was “The Hard Thing About Hard Things“. I really enjoyed reading that book. And right now I’m reading “Principles by Ray Dalio” really, really enjoying that as well.
Lisa:
Yeah, I know that.
George Azih:
Yeah. But those three books I think, were really important to me.
Lisa:
George, thank you so much. I love what you’re picking down and I think it’s amazing. Appreciate your time today. Thank you for sharing yourself with Startup Runway.
George Azih:
Absolutely. Thank you so much for having me and good luck to all the entrepreneurs and founders out there. It’s a grind but it’s worthwhile.
Lisa:
Welcome, everyone. This is Lisa Calhoun and I am so excited to introduce our keynote for Startup Runway. He is one of my favorite, not just Atlanta founders, but founders period. He is the CEO and Founder of Lease Query, an Atlanta FinTech company and Valor is proud to be an early investor. Welcome, George. Glad to have you here.
George Azih:
Thank you so much for having me, Lisa. I appreciate it.
Lisa:
So, we’re going to go through a little bit of your founder’s story, and I want to bring everyone right to the beginning. When did you know you’re an entrepreneur?
George Azih:
Oh, well, that’s an interesting question because I didn’t really think of… Hmm, I think there’s a lot of misconceptions, so to speak. Everyone wants to be an entrepreneur, right? I wanted to start a business. That was my fate, my thinking. I wanted to, not even start a business, I just wanted to solve a problem. I think it’s more what I set out to do, was to solve a problem that I had.
I got the idea for Lease Query in in March 2010. That was where I had the idea, because I faced a problem. And the first line of code was not written until September 2011. So, between March 2010 and September 2011, what I did was really, really understand the problem and become an expert on accounting because it’s an accounting product. Become an expert in accounting, and that was very important to me because it gave me credibility. Because if I showed it, I really understood the problem, then it’ll be a natural step for prospects for potential clients to say, “Okay, since you really understand the problem, what’s your solution?” And if I spend nine hours talking about the problem, I only need to spend 30 minutes talking about a solution as long as I develop credibility during that nine-hour period, then it’s a lot easier for them to accept whatever solution I presented.
Lisa:
So, why did you want to solve the problem of lease accounting?
George Azih:
Well, because it was a problem that I had in my previous life, prior to Lease Query. I was technical accounting and accounting research at a Fortune 500 company here in Atlanta, and which meant a big part of my job was figuring out, what are the new accounting pronouncements that the boards were considering? And, how do we, as the company, structure our contracts and our arrangements to get our preferred accounting treatment. So that was my job. However, I also had some other small roles that I played in the financial close process and one of those roles was lease accounting. This was one out of maybe 30 tasks that I had to do, but it would take me 80% of the time. It was awful.
Something else that happened during that period was the company I was working for changed auditors, they switched auditors from PwC or anything on. So, this was Arthur Anderson’s first year on the job and as a result, they decided to take a deeper dive into the financials and one of the areas they looked at was leases. And they tested the 10 out 10 of those leases and 10 out of 10 of them are wrong. They tested another 10, and 10 out of 10 of those were wrong. So, at this point we’re zero out of 20 and, and so the chief accounting officer, she tasked me with teaching all the controllers.
This is a global corporation, so she tasked me with teaching all the controllers how to account for leases. So, my thinking was well, right now we’re getting it wrong. And as I said, in my role, there was accounting research and technical accounting. So, I knew that the boards, the FasB, the governing boards for accounting in the United States, were considering changing the rules and making it more complex. So, I’m sitting there and I’m like, “Here we are, when it’s easy and we’re not getting it right. So down the line, when it becomes harder, it’s gonna be a big headache for companies.”
And so, I decided that at that point, there needed to be a solution in the marketplace and I decided to build it.
Lisa:
So, you decided to build it. Did you imagine, a huge company, wonderful office space and terraces, hundreds of employees? Where’s your head?
George Azih:
I honestly thought, success for me at the time, was making $350,000.
That was my number, so to speak, $350,000 a year and with five or so people at the company that was what I sold to, as a first employee. And that’s it –seems like a very, very nice lifestyle! And that, I think that’s why that distinction is important. I’m starting a business or solving a problem versus starting a business. I think that distinction is important because if you’re really, really obsessed about the problem– I have an obsession over lease accounting. I
f you’re obsessed about the problem, then you can’t help but want to solve it and solve it well. But, if your focus is on building a business and the best business, you possibly can then, I think there are some shortcuts that you make. I think anyway, that’s my interpretation.
I look at my competitors right now and I know they saw an opportunity. They went out to try to grow their companies on this opportunity and it’s day and night our product or customer service versus them. That’s because we really focus on the problem. So I think that distinction is a very important one, you have to be obsessed with the problem yourself.
Lisa:
So, how did you make the leap from solving the problem for the large Fortune 100 company you were working for and make the leap into solving it for the hundreds of clients you have today? Because that is a leap and to some extent, you could have perhaps been satisfied with providing for your employer and doing a great job?
George Azih:
Well, the employer did not appreciate what I was doing. They told me to stop working on this. And, focus elsewhere, I mean, which I can’t blame them.
Lisa:
But, you were obsessed with this problem . . .
George Azih:
Exactly, I was hired to do a job there. And, yet here I am trying to solve a problem which was not it was, well, it was important at the time, but it wasn’t urgent. And most large companies focus on urgent problems, right? Headaches, solving that problem now, and then they move on. And they’re not thinking of, being the best at solving that problem. So, I’m not trying to disparage them or anything, but yeah, I mean, there wasn’t a fit there. So, I had to kind of do it on the side . . .
Lisa:
So, do it on the side. There’s a long tradition of great founders first doing that. How did you know when to make the transition to “now I’m on my own”?
George Azih:
Okay. So as far as the timelines are concerned, I got the idea in March 2010. The first line of code was written September 2011.
Got our first check, which actually I havehere with me. Our first check, as you can see, it was for a $500 from a company in Atlantic called Fresh To Order, that check is dated 12/13/13.
And, I did not quit my full time job until 2015.
Lisa:
Awesome! You see, I think that is often misunderstood about founders, that they just kind of spring from the forehead of Zeus or something fully formed– with their CTO of course. I think a lot of people can relate. I know I can relate to that story that you’re telling. I was working a job for a couple of years before I stepped out fully on my own. I was collecting checks from customers and passing them on to my employees, while holding down a nut.
So, how did you get it coded? Because again, the startup world, it’s like, you have to find your technical co founder. That’s job number 2 after the problem. How did you address that?
George Azih:
Well, I’m not technical at all. I still to this day, don’t know how to evaluate technical talent, frankly speaking, so that put me at a distinct disadvantage. I talked to a couple of people to try to get them on board and, first of all, the cost was exorbitant. And it would only take me part of the way there. What I did, that eventually was very- I was lucky- was my brother, who’s also- he’s now, this is not my first venture, my brother and I started a company prior to this and we learned a couple of lessons along the way.
And, one of one of the lessons- one of the things that he learned and he told me was, rather than get a person to build the first prototype, get a company, outsource it to a company. That way, if whoever’s working the product isn’t doing their job correctly, then you can scream at their boss and then their boss screams at- like the person has to understand that this is their job as opposed to someone who could see it as a gig or see it as a favor, even if you’re paying them. Because you’re probably not going to be able to afford paying them market rates. So, that was the best advice I received. And I hired a consulting company to help me build The MVP and there were times where I’d have to scream at, I assume is the CEO, the COO. And he would now turn it around and talk to Mahesh, who was the gentleman on programming in Iran and ironically, we hired Mahesh. Mahesh is still with the company today, the first programmer that built it. So, I believe that really, really worked in our favor, was doing it that way.
Lisa:
So, another thing I hear from founders a lot as well. It’s not just about hiring the developer. Once I hired the developer, the developer tells me that I need to have proper requirements.
George Azih:
Yes.
Lisa:
Tell me, how do you address that?
George Azih:
I did that way, before I hired- the first line of code was written. That’s what as I said, got the company idea in 2010, March 2010. From March 2010 through September 2011, I was working on the requirements. It was hundreds of thousands of lines and Excel spreadsheets, where I would say step one, step two, step three, in red, and then notes in note one, note two, note three in blue. That way, the programmer understood. I always say this, you do not want your programmers to think. I mean, it’s for sorry, I apologize to anybody who’s a programmer out there, but you do not want them to think, you want to be as straightforward, and literally, there’s no question and I will tell you an example. When we first built the MVP, I said “Okay, there has to be a login.” And he was like, “Okay, there’s a login.” So I came in one time to, obviously, review the work that had been done. And there’s a login, name, login, email address and password and there’s no button for forgot password. And I reached out to him like, “Hey, why isn’t there a button for forgot passwords?”, “Well, you didn’t tell us to and you told me to strictly follow exactly what I said.” And I was like, “You’re absolutely right. That is my fault”. And, adding that forgot password was an extra fee, because it wasn’t booked. So, you have to be as explicit as humanly possible, because in the long run, it’ll save you money. Because any changes from that is that would be an extra fee. So, you don’t want them spinning their wheels because they will bill you for that. So, writing requirements, excellent requirements, it’s huge. There’s a book out there by Steve Krug, “Don’t Make Me Think“. It’s an older book, but I think it’s still true. It’s more of a design book, but I applied those principles also in programming.
Lisa:
So, when you started hiring your team, what were some of the big lessons learned are things that you say “Hey, if you’re talking to other founders serious Startup Runway, when they get to that point past requirements, past MVP, past customer number, maybe one, two and three, now they’re building their team.” What were some of the things that you wish you could have coached yourself on them, if anything?
George Azih:
Well, a) you can never make a judgment on an individual before 90 days.
That is one thing that I have learned in hiring people. When they start a lot of times, they’ll start off really great. They go by, “oh my god, this person is great, this person is great.” And, all of a sudden, they don’t end up being great.
So, I never have good or bad feedback. I mean, obviously I’ll give feedback, but I’ll never make a judgment call on someone prior to 90 days. That is one thing I have absolutely learned here.
Something else I’ve learned is, I let my people manage. I let my managers manage, they make their own decisions. Because if I don’t, then I can’t hold them accountable. If I say, “Hey, here’s what you need to do.” and they do it, and it doesn’t work, whose fault is that?
Now, on the other hand, if I say, “Here’s the outcome I want. However you get it done, as long as you get it done with as long as you give me my outcome, then you’ve succeeded.” So, there are obviously areas where you kind of ride that in, in terms of culture, how you manage the people, that you manage things like that, but, I lead my managers. That’s something I learned pretty early on.
Lisa:
So, when you told me about Lease Query first getting started. You worked quite a bit remote, and we were talking recently with COVID that there’s some remote capacity in the DNA essentially at Lease Query. How do you feel about a co-working path office? All that you’ve learned in the past few years, how important do you feel the office is? And how do you see it functioning in the life of the software company?
George Azih:
Well, I think the challenge that I had prior to COVID, I was never able to work from home. Lease Query was started at Starbucks. If you come to our office now the video, you’ll see a timeline of Lease Query. And what you’ll see are pictures of us at Starbucks, because that’s where it [started]. Actually you’ll see a picture of Northside Hospital, of me holding my daughter’s- well, one of my daughters, I have twin daughters- and they were born at Northside hospital. And I have a picture of one of them, of both of them. I don’t need- the good thing is, I don’t know which one is in the picture. So when they ask, I can’t say, I really don’t know, it’s one of you. But I really don’t know. But that’s where the amortization schedule is built.
My ex- I’m divorced now- my ex-wife was on bedrest from October 2011 through January 2012, when the kids were born. And so, we were living literally in Northside Hospital for those months and that’s where I was writing the requirements for the amortization schedule, which is literally what the LeaseQuery was built on. So, I remembered so that’s where the timeline begins.
Northside Hospital to Starbucks and then from Starbucks to Barnes and Noble and then from Barnes and Noble to office space, etc.
But I was never able to work from home, which is why I would go to Starbucks, and then from there to Barnes and Noble. And then all of a sudden, you’d need real quiet time to have phone calls, and it’ll be loud at both Starbucks or Barnes and Noble. So, we went to a place called Rome, which is kind of like a WeWork. I think it has a better model than WeWork, frankly speaking. And I did that because I needed a quiet place to work. The point is, when it comes to remote working, I’ve been forced to do that now at home because of COVID. But, I’ve always thought, at least you can- we travel right but not often. We did like to travel a lot. I had a requirement where everybody has to travel once at least once a month, because, you go out there, you’re face to face, it’s a lot harder for people to tell you know, how to do your face in sales. So, we would use that to our advantage for larger deals. But, we’re able to work remote now. I’m personally able to work remotely now, because there’s some lessons that I’ve learned, have a place where you work. A place where you say, “Okay, this is my workspace.” And that makes it easier as opposed to, in a dining room or in a bedroom, it could be in either of these places. But as long as it’s a designated place for you to open up your laptop and get work done, and fill out to the extent you can, I know it’s tough now with COVID for people with children, but block out the outside world, I think that makes it a lot easier.
Lisa:
So, what are some of the other things you feel like, “Oh, these are lessons I had to learn”, that maybe you’ve seen other people also need to learn and you can remove some pain by sharing anything around. How do you do your own accounting? How do you hire your C suite? You have some terrific salespeople, some terrific people in law working with you today. How did you attract the top notch talent that you have now?
George Azih:
Well, I’ll also go before the hiring. I think one big mistake I see a lot of entrepreneurs making, is they spend so much time on social media.
“Building their brand,” and I use brand as air quotes here, because I know this is one thing I believe. And, I don’t want to be controversial here, but I believe that, you’re going to do one of two things. You’re either going to build your personal brand, or you’re going to build your company. Choose one, because it’s either you’re going to be on Twitter or Facebook, and all these things, building your brand and tweeting all the time. Or, you’re going to build a solid company where nobody knows who you are, but the people that you’re trying to sell, or trying to sell to, know you, know the good company. So, I would say that’s one big misconception that I see out is, a lot of people think social media is the cure-all bill. As long as I’m all over social media, that gives me exposure. Which could translate to sales? Not true. So, it’s more focusing on your- like writing an actual blog, those are hard. It’s easy to tweet but, write a blog that really speaks to your audience like something where you’re actually giving them value, true knowledge. Now, that’s probably easier for me, because once again, it’s accounting software. So, I know if I write a detailed accounting blog, and I better know what I’m talking about, so I have to really research it. But the thing is, now that I have that anybody who comes in and reads that blog, and spends, five minutes on that blog is a potential customer. And so it makes your path easier, as far as that’s concerned. So that’s- I’m sorry, I tend to ramble quite a bit.
Lisa:
Yeah!
George Azih:
One of the things I’ve learned is how to capture customers by really using marketing the right way. SEO.
Lisa:
So, true. Thought leadership–real expertise.
George Azih:
Correct.
Lisa:
Not dancing around the small stuff, but cutting right into the meat of it. And then once they’ve started to consume your content, what have you learned about hooking them into the actual product? Because there are people that seem to kick tires and read more and learn more and go to every webinar, it’s like a decision. How have you learned to pressurize the sales decision?
George Azih:
Well, I can’t remember, what article or book, I read where it said, “Do the things that don’t scale.” Do that that doesn’t scale.
And, I think we did that. When I started Lease Query, I visited every single client for the first 15 clients we had. It was face to face, I went to them. I always joke. I had a 100% close rate for those guys. But every single person I went to, we closed. And I think it’s because I learned a lot during that period because I knew who they were, I knew the problem innately. So, going through the demo itself, was giving them examples, “You know when this happens? Well, here’s our solution to that.” “How do you have this problem, here’s a solution to that.” And you’re doing it to their face, and as I said, there’s something magical about that. When you see literally every head nodding in the room during the demo, and they go, “Oh, oh, yeah”. That’s part of that credibility. So, doing the things that don’t scale. My preferred airline, Southwest Airlines. Why? Because I could cancel at any time. Once, I set a demo. I call them and they said, “Hey, I’m about to, yes, we’re interested in seeing a demo.” I would celebrate that, that’s actually very important. Celebrating the small wins because that’s what keeps you going during the downtime, and you will have a lot of downtime.
I would celebrate that and then a day or two later, I’ll call them or email them and say, “Hey, guess what, I’m actually going to be in Dallas for a meeting, why don’t we do this demo in person?” And they’ll always say yes, believe it or not, they will always say yes. “Sure, absolutely. Come over to the office.” Perfect, right there and then book a flight using Southwest and fly there. Sometimes they’ll cancel and then you cancel, but you get a credit on Southwest. So, I mean, doing things that don’t scale was important, also anticipating things. I just showed you our first check.
I’ll tell you a story about what happened. When I got the demo, as I said I went in person and the night before, literally, four o’clock, I’m thinking through my head. “What are the things that could happen? What are the things that could happen?” I had an extra pair of an extra suit in the car just in case something happened. And then I thought to myself, “Oh my god, what if they don’t have a projector? Or the projector isn’t working?” So, I call my mom. I mean, I’m at this point, I’m broke. So, I call my mom and I’m like, “Mom, I need a projector.” “[What] you need a projector for?” And I go, “I have this- for the demo tomorrow. I need to be prepared in case they don’t have a projector.” And she goes, “Okay”, so she lived in Houston, she paid for it, went to BestBuy, pay for it using her credit card, and then I picked it up from the Best Buy here. So, I got it figured out how to use it, practiced it everything. And my meeting was literally at 8 AM the next morning. So, I get there and I have driven there like three times already just to make sure. I knew how to get there and knew where to park and everything, and got there.
And it was, the lady was like, “Okay, that’s the conference room we’re going to be using. I said, perfect. I set up and she goes, “I have never been able to figure out how to work our projector, and our IT guy doesn’t get here until 9am.”
And I was like, “Oh, that’s okay, I have a projector”, and the CEO was there. And he looked at me, he was like, “You actually have a projector with you?”
“Well, yeah” very casually. I was like, “I’m always prepared”. And he was like, “Huh, interesting” and I honestly feel like that right there, was the deal.
Lisa:
Yeah, you right there.
George Azih:
Yeah, because he actually would leave the room and come back. He’s like, I’m a fly on the wall. Ignore me, ignore me, leave the room and come back. But I think that sense of approval to the controller that she could make the call and choose us. So, that’s me– just anticipating those kinds of issues, I think that helped.
Lisa:
George, you are a master of hustle. So, I know you have a really, really busy day, I am really thrilled that you could share your wisdom because that is exactly what it is with Startup Runway because you’re building Lease Query now, but also so what I want you to do is brag a little. Tell us about LeaseQuery today, tell us about those customers, tell us about your team. How’s it going?
George Azih
Well, the irony is it’s funny you say that brag today.
When we were three people in a company, I would routinely say that I hate vanity metrics. And for me, vanity metrics are the number of employees that you have. How this is funny, it’s been so long since I’ve had to think about this.
But, I had now, the number of employees was one, how big, how much revenue you had but even though that’s more of a close. I can really, oh your office space. Where’s your office?
Those are vanity metrics that I really didn’t focus on. And I hate it when people ask me that question. What mattered to me were, what’s our close rate? How often do we beat out our competitors? And those were the numbers that I really, really embraced.
So my point is, I’ve never really been used to bragging because I never really liked those metrics. But, I can tell you about the Lease Query. Where we’re about 200 employees now and revenues where we’re going to be at about $20 million ARR in terms of revenues. However, our cash collected is slightly different because we do three-year contracts, so that’s probably gonna be, last year that was $30 million. So, is that good?
Lisa:
It’s really awesome. I love it.
George Azih:
I know you — not what you wanted me to say.
Lisa:
No, that’s I think just giving people a sense of what’s possible with the kind of commitment and dedication that you’re talking about, because I mean, George, you’re a very humble person. You’re a very humble person.
And I think that when people hear you speak, your humility overshadows the achievement that you have created and are continuing to build.
I call LeaseQuery a legend. believe it is a known legend to a few people today and will be a legend to many people as you continue. So, I just wanted to get some of that out there. And now ask you–
George Azih:
Thank you for your kind words.
Lisa:
It’s easy, it is just the way I see it.
So, how do you look at founders today because you and I occasionally talk about opportunities to invest. I’d love to get your take on founders the Valor is looking at. And I’d love to know what you’re looking at. As a newly minted investor that has quite a few deals really when you think about it. What are you looking for in founders yourself on the other side of the table?
George Azih:
Well, honestly, I’m not gonna do that at all. I think it’s too soon. But I think that’s why I rely on funds like yours, to help with that to help me navigate that because I frankly just don’t know.
I will say I do look for companies that are similar, companies that are selling, a must-have versus a nice to have. Founders who have innate, just intense knowledge in the problem that they’re solving. I’ve spoken to quite a few people and you haven’t have a broad array of knowledge. And if you’re in a space and I asked you, “Do you know that this person in that space?”, and they say, no, that’s a problem.
That’s usually an indicator that you haven’t really done your research. When people come and say, okay, I want advice, I tell them, there’s three books that I read that literally, the most important of which I believe is The Startup Owner’s Manual. It is a thick- very, very thick book. It’s a fun read. And, I read it at least once a year now. I mean, that’s how much, it is an excellent read. But it’s not an easy read. It’s not an easy read.
And when people say, they want to talk to me and either mentor them, I tell them to read that book. And if they haven’t read it, then I know, because, I mean, that book literally helped me right to get to where I am because that’s why it said do “scratch and claw” one of the principles it says “Scratch and claw to get your first 10 customers.” Because once you get 10 customers, you can get 100, Once you get 100, you can get 1000. But those first 10 are very important. So, that’s where that’s okay, I am flying to every single potential meeting. That’s where I came from. That’s why I did that, I didn’t realize what I was doing at the time, but I just wanted to make sure I closed the deal. Because then that helps you with your next hundred. When people show me that this interest is right or that I’m not serious enough just to read a book that I’m telling you like really helped, then it’s like okay. I kind of just- there’s a lot of entrepreneurs. I mean, there’s nothing wrong once again- I said this earlier, there’s nothing wrong with building your brand. Your individual brand, that’s absolutely nothing wrong with that, please don’t, I’m not trying to dish brush here. At the end of the day, though, you have to decide. Do I want to build a company or do I want to build my brand? And there’s very, very big differences there.
Lisa:
Well, I think they took some notes. So, if you’re looking to George for an angel check, you know what to read. And you said there were three books though. Those are two. There’s always one, can you share the other two?
George Azih:
Well, Steve Krug, “Don’t Make Me Think” that’s more of a design book, but it tells you it’s about building intuitive. Your product has been intuitive. Use things that people already know and are used to. Don’t try to recreate the wheel. So, you’re on-off button for us on Lease Query looks like it- literally looks like Apple? When on or off Android really? On or off, but because people already know what that means, they know that. So, using those designs as elements of design, that work. The third one and this was actually more recent, was “The Hard Thing About Hard Things“. I really enjoyed reading that book. And right now I’m reading “Principles by Ray Dalio” really, really enjoying that as well.
Lisa:
Yeah, I know that.
George Azih:
Yeah. But those three books I think, were really important to me.
Lisa:
George, thank you so much. I love what you’re putting down and I think it’s amazing. I appreciate your time today. Thank you for sharing yourself with Startup Runway.
George Azih:
Absolutely. Thank you so much for having me and good luck to all the entrepreneurs and founders out there. It’s a grind but it’s worthwhile.
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