Chris Dean has taken several companies through successful exits. Now he’s working on his biggest project yet. One which has already attracted tens of millions of dollars in investment, and moves billions of dollars each month. The startup, Treasury Prime, has interested investors like The Banc Capital, Invicta Growth, Deciens Capital, and QED Investors.
In this episode, you will learn:
- Fundraising for your startup
- Structuring M&A deals
- Changing the US banking system
For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
The Ultimate Guide To Pitch Decks
Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).
Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.
About Chris Dean:
As CEO and Co-Founder of Treasury Prime, Chris is responsible for all aspects of Treasury Prime’s strategy, execution, and operations. Prior to launching Treasury Prime, he served as CTO of “API first” company Standard Treasury.
When the startup was acquired by Silicon Valley Bank, he took on the role of CTO of API banking for SVB. Earlier in his career, Chris founded or co-founded software companies, including Merced Systems (enterprise software), Kyluka (a consulting firm), and Benefitter (an ACA-based health plan.)
Chris started his career as technical staff in the Machine Learning Systems Group of NASA’s Jet Propulsion Laboratory. He studied physics at the California Institute of Technology.
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Connect with Chris Dean:
Read the Full Transcription of the Interview:
Alejandro Cremades: Alright, hello everyone and welcome to the nellmakerr show. So we have a very very exciting founder today you know someone that has done it so many times. Oh my god you know I can I can even lose track. So again, you know we’re going to be talking a lot about building scaling financing selling. You know, ah getting a choir I mean you name it. So without further ado. Let’s welcome our guest today Chris Dean welcome to the show.
Chris Dean: Hi Thanks all hanra I’m happy to be here.
Alejandro Cremades: Um, so originally born and raised there in San Diego and I know that the family you know, really likes surfing so how was life growing up.
Chris Dean: It was great. You know we had the world smallest house but it was on the beach and they were all crammed in there and I loved it I and I went in the water every day for years I live in San Francisco now and the water is just a little bit too cold for me, you know, growing up in San Diego it’s warm here. Freezing. But.
Alejandro Cremades: So so obviously you know like the water the surfing I mean what? what got you into this technical side of things into into the engineering.
Chris Dean: I love math I mean I always have I always I don’t understand why other people don’t love it It’s like the funniest thing ever um know so I did well in high school I went to you know university and did well there. Um I you know was a physicist and. And the world of physics I was the best computer scientist and the world of computer scientist I was the best statistician so obviously that pushed me into machine learning because that was great because I was always the person who knew the other side of the problem. You know I did research for a while. Jpl which is um, you know run by Caltech where I went to the university my advisor was head of labs there and that was a great experience and I I just love that that was maybe the best job I ever had sitting in alone in a room with a whiteboard is really great.
Alejandro Cremades: So in your case I mean obviously you go to Caltech and then you eventually move to San Francisco and I know that moving to San Francisco was a little of a shock no on seeing you all the innovation and all the good stuff you know happening around you. So.
Chris Dean: It was it was it was great I mean I was not prepared. That’s for sure I my wife wanted to move up here to take care of her parents and so I thought I’ll do that until I decide you know where I want to go next you know, maybe go down Stanford or you know.
Alejandro Cremades: So how was that experience for you.
Chris Dean: Or more somewhere like that. But I got a job at a startup was my first real job I literally did not know what a startup was I was the first employee there and it was you know something that I was the subject matter expert in um, it was this machine learning ai stuff and we. Built a company around that and it was very very early. This is like dot com days and oh my gosh is this a poorly run company and I love like my peers there but I don’t think the man was really in control you know drugs and sex and chairs thrown across the room and like. Court orders preventing 1 founder from entering the building. It was just no fun except I love the startup part of it I love talking to customers I love building the thing I love figuring out what people actually wanted that was so interesting and i. once once I had done that for like even this the year I was like well this is what I’m doing for the rest of my life.
Alejandro Cremades: And you know there was ah a company that you got going there you know and and and basically what they were doing was ai machine learning I mean ai machine learning back then I mean nobody really talked about this now you know Ai and machine learning is. Absolutely everywhere. Everyone is talking about you know, implementing it from some shape or form but back then it was kind of new. So quite innovative. Yeah.
Chris Dean: Yeah, yeah, it was very at the time I mean I um, ah had the you know Paul and I had the largest machine learning problem ever solved right? or ever worked on like we had these massive networks of computers. We had you know, put together. Um, at the time they were gigantic and now they’re kind of a rounding error. You know it’s like if you look at a modern system there you know thousand times through orders of magnitude bigger than what we worked on and it was super interesting, really fun and. I found the thing that was kind of the aha moment for me was that the quality and amount of the data were the thing and less so the algorithm and over time I spent time looking for more and more data more and more great data and that’s partly what led me to the job is that they had actually good behavioral data and they had a lot of it. And that’s why I thought I could do this.
Alejandro Cremades: So after this one you know you ended up going to babycenter. Ah, now that that was quite an interesting run because the company got acquired but then the company that acquired you went bankrupt So why? So I guess you know.
Chris Dean: Yeah, just fun
Alejandro Cremades: How is it, you know, like really achieving the high. So if everyone’s celebrating hey you know we made it. We made it to the finish line and then all of a sudden boom. You know, like the the whole thing you know comes a crashing down. But.
Chris Dean: It was it was it was a ride for sure so I had loved the work at that first startup that ai startup but I realized it didn’t actually tell me how to run a business so I did what any you know you know scientist engineer would do I flipped some variables around I said okay. Let’s look for another startup but something where the business model is completely obvious and baby center. It’s basically it was a magazine online about you know you’re pregnant. You’re gonna have a baby or you have newborn have take care of them. There’s ads that says at the top of the page say you should buy a minivan that makes sense to me. You know I understand that business I don’t know if it’s a good business but at least I understand it and that was an amazing experience. You know it was run by some really just superb product managers and like you said we got bought by etoysetoys was perhaps less well run. Um. But that ipo day all was so fun I got those friends and family shares it went from $20 a share to $80 a share I sold it in the first day made $60000 that was amazing and the paper is worth many many many times that and I’m running the engineering website group at um.
Chris Dean: At E Toys you know it’s a big busiest traffic site in the world at the time and that was great and then we went bankrupt and I made nothing I made that $60000 that I made on that first ipo day was all the money I ever made out of that company except for my salary and that was. Also an aha experience like oh maybe being rich on paper is not the most important thing here. Maybe we should actually have create real value and that was that was a journey for sure.
Alejandro Cremades: But that for sure you know like gave you access to um to saying hey you know what I’m gonna go at it on my own and I’m going to start my own company. So what happened there for you to say hey you know I think that maybe you know I’m gonna go out it with this idea I think this idea has legs and I think it’s my time.
Chris Dean: Yeah I mean that was exactly what happened um somebodyddies and I from um babycenter Actually who said okay, we’re great working Together. We’re really smart. Um, let’s pick a new problem and we pick more of an enterprise software problem where we could you know help Corporations. Um. Hire and manage people and yeah, it turns out that every company hires and manages people so we picked our particular area and we dominated that area um turned out. It was a very small market but we did dominate it and eventually we sold that company for you know, a good amount of Money. We took very little um outside capital so that was a good exit for everyone. We’re very happy with that good must? yeah.
Alejandro Cremades: And I know that the exit was 200,000,000 so ah least you know as some something along those lines. You know you took little capital so you know I’m sure that you know there was some splurging there that came out of the way you know, ah out of that amazing outcome on your end because I mean that’s a lot of money. So I guess saying.
Chris Dean: Um, gift.
Alejandro Cremades: You know from that time from that experience. You know where yeah I mean obviously incredible outcome right? Your first company first day exit like that. What did you learn from seeing the full cycle of a company you know going the full cycle from idea to product market fit to. Fundraising to scaling to exit I mean what? what was that visibility what that that that that you gain access to by going through that.
Chris Dean: Sure so I found the things I was interested in and so I could focus on those and I also found the things that were important and where you know I realized where those weren’t the same thing that I had to find a buddy I had to find a partner who was good at the things that wasn’t good at right or is interested in things I wasn’t good at and for me, um, things that are important here a you got to have the right problem like if you’re doing a problem that no one cares about no one’s going to pay you any money if no one’s going to use. It doesn’t matter. You got to have that product market fit and then second. Have to surround yourself with the absolute best people like we had a highly productive product team and it was known for in the industry for being the best and the most highly productive and we are also an order magnitude smaller than most of the other folks and why is that because every individual was just outstanding. Just incredibly incredibly good I still you know the? Ah so many of those people went on to found other companies become rich themselves and that like showed me that like my job as a leader is just is to pick the right problem and then to make sure that I have people around me who can execute. There are things I don’t really love right? Um, and but I love managing the people and I love talking to customers and like those are what I ended up focusing on um, fundraising at Mercette was very easy. That’s this company because you know ah we tried to raise money right before 119 is that you know.
Chris Dean: 20 whatever year old company and we got all our term sheets pulled because of that because nine eleven like it was just terrible tragedy hard to get through but we ended up raising money after that we and because of the times we ended up raising just a few million dollars but that was enough to get to started and we ran on that for years. Raise any more capital and for just quite a while and that made it so that you know everyone involved had a really great exit.
Alejandro Cremades: Now in this case, you know the exit. What did that look like I mean how did the exit. You know, come together. You know was it like a process that you guys decided to start you know was say it they you know some inbound that came through and then you know what were the events that needed to upfold for the deal to close.
Chris Dean: Sure I mean like a lot of these things. It wasn’t out of the blue. Really it was. We had the existing partner who was bigger than us in this ah in a similar and adjacent space and they wanted to expand and they knew that we were you know the gold standard. So they approached us at some point and wanted to deepen the partnership and then very soon after that they made a you know and a they made overtures to acquire us and then it’s pretty easy after that you know there was negotiations and you know we wanted a number and they wanted a number but eventually met in the middle and. it was it was easy right? and often these things are easy. This is to contrast contrast that with the baby said during the dot com times where that was very different and during um the baby centerter one and I was not the founder there. So I was not like it’s privy to this but we had an offer from Amazon in hand back at babycenter. And um, etoys came to us and offered us like many many more times that offer so we took the etoys offer maybe in retrospect I wish we’d have done the opposite because you know Amazon still seems like pretty good company and etoys is completely bankrupt. But when the mer said acquisition happened was pretty easy. It was very straightforward. And you know went fast after that I would imagine that if we had said no during for the merset acquisition. There were not there would not there been a second offer we’d still be he. We’d still be running that which I think was smart of us to take the offer.
Alejandro Cremades: Now I Guess you know after the um, the acquisition you know of of of mercered systems. You eventually went on to ah do some consulting you know and you were also semi retired. Ah, but.
Chris Dean: Yeah. It.
Alejandro Cremades: Then you know you came out of retirement now. 1 thing that is very interesting. There is you know as they say an entrepreneur always an entrepreneur entrepreneur and obviously now you know you created another company and we’re going to be talking about your latest baby here. But before that I mean you came out of semi-retiement to be the employee.
Chris Dean: Sure.
Alejandro Cremades: Of another company I mean come on on entrepreneurs are unemployable. So so what happened.
Chris Dean: I ah, it’s true. Um, well, they’re very early. Um, my buddy Dan was renting this company called standard treasury. It’s a banking software company I know a lot about software I know at the time I knew 0 about banking. And a bank account. That’s all, but you know he convinced me in the room and he said basically look they were having some founder drama he was having some founder drama. He needed to replace his technical co-founder what I come in and run the technical group and I’m like no but he could you know. But he did that thing that you know you can do sometimes where he took me out for a 3 hour long um you know cup of coffee and he convinced me in the room. It’s very hard to sell me in the room but Dan did and you know I I love the problem and. The more I learned about banking in you know the us banking system the more I became more interested in it and you know that led me to take the job he had. He had a very small team but it was a great team and that that was a mark of excellence to me like if the people you surround yourself with are great then maybe there’s something here. And so that’s that was the reason.
Alejandro Cremades: So then what happened there because obviously you guys again, you know you go through another acquisition with a Silicon Valley bank and then you know you thought they I’m gonna get out of here. But you stay there quite a bit but this was the immediate step that needed to happen for you to start.
Chris Dean: It take.
Chris Dean: Hundred percent
Alejandro Cremades: Your next company So you know if they say ideas you know they take time to incubate and we don’t even know that they are there but you know definitely the idea was there of treasury prime and and I guess you know at what point do you say? Okay I think that I really got to go with this one.
Chris Dean: Yeah, um, Silicon Valley Bank was our first client and they heard rumors that we were going to be purchased by Wells Fargo and that’ was not true, but they heard rumors and they wanted to buy us to lock us in to make sure that they had access to our software. No other bank. Did. So okay, um I expected to stay for you know a minute couple months while my folks got settled. It was a decent acquisition I mean people bought houses and stuff but no one bought like a brand new plane. It was just it was a fine acquisition. But um I didn’t think I’d stay because. Like you said like I’m an entrepreneur I’m working a bank come on. It doesn’t seem like that’s a thing that I would do I ended up staying there 2 years because a the people at s three b are just really nice and 2 the more I learned about the actual banking system. The more I was shocked by how messed up it was like. Bar was so low that you know we could come in and do something which we thought was trivial and simple from a technical point of view and it would be hailed as like this great achievement and I was like oh the banking system really needs help and you know. Spent a long time. My co-founder Jim and I trying to figure out the right strategy to solve this problem generally and we saw other people start we went. That’s the wrong strategy. They don’t actually know how banking works and we came up with this plan and you know that’s the company I met now treasury print started that.
Alejandro Cremades: So so then know what what were the early the early days of tertiary prime because obviously yeah, at this point you’ve been involved with a bunch of companies. You’ve seen it all So how did you go about surrounding yourself with the right people.
Chris Dean: Um.
Chris Dean: Sure we were very careful about realizing the problem we were solving at treasury prime like banking. The us is different than making to other places in many ways. The us has the you know best economy in the world. I mean does have the best economy in the world and. Um, but our banking system is really lacking in just fundamental operational things like it’s hard to move money around. Um, we have a very fragmented banking system. You know five thousand banks 5000 credit unions depending on how you count you know 4 5 national regulatory agencies. It’s very complicated so we want to make sure we laid out a plan where we could do the the problem we were trying to solve which is to create a brand new dominant architecture for us banks to communicate with each other and how do we do that we said okay. We went and we raised the seed round and that was very easy because we were like I said look we made a lot of money for you before we can make money for you again. We’re experts in the field here’s our problem and that was a very easy pitch. It was very very easy to raise money. Um, and we raised money for that and. I went and reached out to like the best engineers I know and I know a lot and I went out to the best people to manage the banks and I know a lot of those and we started from there and we’ve been going ever since every time we need to go through different transition. The company I use that as an opportunity to raise more capital. It does mean that.
Chris Dean: The seed stage company is very different than the series A which was very different than the series B which is now very different than the series C company right now.
Alejandro Cremades: And in your case I mean going from technical because I mean you’ve been a technical guy all along you know now you are more on the business side of things you know as well. So how was that transition for you.
Chris Dean: Sure.
Chris Dean: Um, you know we’re all good at different things and I think that um I’m you know Jim and I did build the first product I mean we sat in a room and by ourselves for a couple months and just built the product. Um, and so that’s helpful that you know we have that horsepower.
Chris Dean: The business side is um, it’s not that different from how the company runs not a lot differently than how a computer runs a computer system runs that they’re all there have rules bank you know computers are a system. There’s a way they work. Business is a system and there’s a way that it works and if you understand how it works. It’s actually not that hard I can tell you that I’m great at product side and I’m kind of terrible at the marketing side and so I make sure I surround myself who are people who are good at the marketing side and that has worked well like um. You know the person I run the company here with um, ah the Co O O remy carroll and remy’s great at all the things I’m terrible at he’s great at running the gotomark team. He’s great at the level of detail on that you need there and I’m great at the product side so we can make sure that the business keeps running that way.
Alejandro Cremades: So for the people that are listening to really get it. What ended up being the business model of treasury prime. How do you guys make money.
Chris Dean: So that’s a great question. We are a marketplace between fin tax and banks what we do is we connect directly to um, a us commercially chartered bank. We do deep integrations with them like we connect directly to their internal systems their cores their payment gateways. All that once we do that we can do anything the bank can do and then we put a common Api layer across all of our banks and we have a lot of banks and we then go out and help the bank find finte to place. Um at each bank. So we have you know we have a lot of banks and we have a lot more fintech and than banks obviously and we put them together because what we’re trying to do is create an open banking standard across the us and you know we’re doing that one bank at a time but it’s definitely working. We charge the banks to use our software. We tries the fin text to use our software. Um, if you want to open a bank account. We charge you for that if you want to send a wire. We charge you for that. Um, it’s very much a were a platform and you paid to use the platform.
Alejandro Cremades: So in that regard you know the fundraising journey for something like this is is very unusual right. It has been very unusual for you guys. How much capital have you have you raised to date for this.
Chris Dean: Oh see what is it? Um, we’re almost at 70,000,000 so you know not not a ton.
Alejandro Cremades: And why the the process you know racing for something like this has been so unusual.
Chris Dean: Well, you have to go into this problem knowing that the banks are going to be slow is that there’s a lot of players here. There’s the fin tax which are you know tech companies like us like you know that you you and I talked to every day but the banks are slower moving and then the regulators are slower moving than that. And we count each one of these groups as our constituents like we we deal well with each one of them because you can’t make a new system without the regulators. Okay, you can’t actually run the system without the banks and the people who are supplying this new product lines are the fintech. All your interests have to be aligned but every time we raise money every time we went through a transition the company it’s because we were transitioning to the next step of that so in the beginning we had one bank and we didn’t mostly work for the bank with just a few fintech the next stage was. Expanded pretty dramatically our number of banks and you know added um a commensurate number of fin text on top of that and the third stage you know the one we’re at um, you know before that we actually started to build out. Um our marketplace of banks so it was easy to move around. And right now what we’re doing is we’re actually executing on that marketplace. This is you know it’s we’re like 1 step away from the end. Um from our end business model and the business model right now is that we have all these banks we have a lot of very large finntax who use us as.
Chris Dean: A network where they can talk to multiple banks at once they can move money around. Um you know we have you know billions and billions of dollars worth of deposits that we help people control and they move that around between different banks and they do that seamlessly because our platform is the same. Regardless of the bank and our platform makes every bank appear to be the same as every other bank.
Alejandro Cremades: So so I guess say to really get an understanding then on the scope and size of the business Gris I mean anything that you can share in terms of maybe number of employees or where you guys are at with the company. Do they? okay.
Chris Dean: Sure I mean we’re doing really? Well, we’re growing. We have a hundred people at the company now just about um are the measure we usually use to see how our overall health is the active. Um, how active our platform is because the interesting thing is our platform. And you know we are you know we move. Um, you know monthly was it last month like you know four or $5,000,000,000 in in capital in I’m sorry in money movement and then we have um you know about because. $3000000000 in deposits. You know like that last month and month before was more and then next month it’ll be more but our goal here is to make sure that like all of our 16 banks have a lot of deposits have a lot of fin tax and by the time that happens we’ll have. 32 banks and by the time that happens we’ll have 64 banks so we’ll just keep growing.
Alejandro Cremades: So I was here talking about goals and perhaps vision too. If you were to go to sleep tonight and you wake up in a world where the vision of treachery prime is realized what does that world look like.
Chris Dean: Yeah, oh that’s great. That means there are hundreds of banks probably not thousands but hundreds of banks on the treasury prime platform and that there are fintechs that are on top of those banks. Are making a brand new way that the us can actually run its banking system. That’s the goal here. Um, what we’re trying to do is solve a government size problem I don’t think the banks are going to do it themselves I don’t think the regulators are going to do themselves so we will the nice thing about that is that. You know it’s that phrase a rising tide raises all boats that by making the banking system easier to use making making it simpler to do innovation. There’s gonna be things that are invented that we’re not even imagining here that the fintech explosion just going to increase. So if I had all my dreams that. There would be these banks that were running. You know that were controlling no trillion dollars in deposits because that’s about that’s about 5% of the u deposits right now and that seems a very reasonable number for fintech to control and. That leads to a level of innovation that we’re not even matching now in the same way that you know the internet led to level of innovation that we weren’t thinking about that you know smartphones led to uber and things like that we can’t even imagine what’s going to happen but you need a common platform to do that as a side effect whoever runs that platform is going to make an enormous amount of money.
Chris Dean: Which is the pitch to all the investors you know.
Alejandro Cremades: And in this case I mean we’re talking about the future Imagine if you were able to look at the past and and be able to reflect on it to guide you know, perhaps your future. You know if you had the opportunity of going into a time machine.
Chris Dean: Okay.
Alejandro Cremades: And going back in time and and having a chat with that the younger Chris you know, maybe that younger Chris that just had moved to San Francisco and that was takinging a look around and you know thinking how cool it will be one day to have my own company if you were able to have a chat with that younger self and being able to give.
Chris Dean: Um, f.
Alejandro Cremades: That younger self one piece of advice before launching a business but would that be and why given what you know now.
Chris Dean: It’s good. It’s a hard one. Um, so I’d say big alert bigger and simpler yeah bigger and simpler like tell myself that like there’s not a reason to pick a small problem like all problems are hard so pick a big problem. It has bigger effect. It’s easier to attract. Um, great people to a big problem than it is to a small problem. Um in some ways. It’s more interesting to solve the big problem. However, make sure at all times that you are ruthless in making sure that your description of the problem that. The whole thing is very very simple right? You want your solution to be simple. You want the problem to be simple as possible because as you grow it is very hard to manage that complexity if it’s just you know yourself in a room. It’s fine. You can do all sorts of duance. But as you go from ten to a hundred to a thousand employees it’s hard to manage that it has to actually be simple or no one’s going to keep up with you so bigger and simpler.
Alejandro Cremades: I love it and Chris for the people that are listening that would love to reach out and say hi. What is the best way for them to do so.
Chris Dean: Oh I’m easy to find you know on I’m easy to find on the internet. You just look for me, you message with me on Linkedin or Twitter or anything but I’m this I offered to use this as an exercise like if you can’t find my email address like it’s published everywhere then you were probably not gonna have a good time talking. So just. And spend 5 minutes and find that because it’s not hard.
Alejandro Cremades: Amazing! all right? Well Chris thank you so much for being on the dealmaker show to aid has been an honor to have you with us. Thanks.
Chris Dean: Thank you so much I enjoyed it.
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