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We’ve just made a modest investment in Slice of Lime. We’re excited – but Kevin Menzie, Jeff Rodanski, and their team are “extremely excited.”
Before you say “hey Brad – why are you making an investment in a small, local, web design and development firm”, stay with me for a second. Put your Warren Buffett “I invest in great people that I like in businesses I understand that can make money over a long period of time’” hat on, and try to remember a little about my past.
I first met Kevin when he was working for Return Path. At some point, he went to part time (Return Path didn’t need a full time person in Kevin’s role) and he worked out a deal with Matt Blumberg (Return Path’s CEO) to start Slice of Lime with Return Path as his first client. As part of this, we introduced Kevin to a few of our portfolio companies and he was off to the races.
He reminded me a lot of myself when I was starting my first company (Feld Technologies.) Hungry, smart, willing to do anything to satisfy a client, unusually responsive, and a complete sponge for new information. I loved his style and we were (or at least I’d like to think we were) continually helpful – for no reason other than we thought Kevin did great work. Over time, I got to know Kevin’s partner Jeff – who also is a stud – and my respect and enthusiasm for them grew.
Over time, they did a lot of work for companies I have invested in, including Return Path, NewsGator, and Collective Intellect. They also did work for some of the other organizations I’ve been involved in, including the Boulder Museum of Contemporary Art, the Women’s Wilderness Institute, and Blink Gallery. They did a bunch of work for me also, including the Feld Thoughts and AsktheVC sites.
Thanks for staying with me. If you know me, you know why we made this investment. Kevin and Jeff have been running a nice, small, cash flow positive business. They have been in the good position of having too much demand for their services. They also have built some great frameworks that allow them to do stuff very economically. Over the last year we’ve spent some time with them giving them advice on how they could expand their business.
One of the biggest stresses of trying to grow a small professional services business is to hire slightly ahead of demand. If you do this too fast, you’ll run out of money. If you do this too slowly, you’ll choke on the work and go through a classic feast and famine dynamic (too much business one month, not enough the next.) If you are capitalized the way Feld Technologies was (e.g. with ten dollars), there is no buffer.
We decided to provide a little bit of buffer for Slice of Lime. While we would never force any of our portfolio companies to work with them, we obviously endorse them and recommend them highly. And – as a number of other people did with me early in my first business – I hope when Kevin and Jeff look back 20 years from now they view us as key mentors for them.