Max Rhodes is the co-founder and CEO of Faire which helps retailers find and buy wholesale merchandise for their stores. The company has raised to date $115 million from investors such as Sequoia Capital, SV Angel, Lightspeed Venture Partners, Khosla Ventures, Founders Fund, or DST Global to name a few.
In this episode you will learn:
- Mastery of operations and vision
- The value of startup accelerator programs
- Replicating what works in other successful companies
- Managing remote teams
- The local retail revolution
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.
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.
ACCESS THE PITCH DECK TEMPLATE
About Max Rhodes:
Max Rhodes is the co-founder and CEO of Faire, the online marketplace that connects small, independent shop owners with makers to help them find goods guaranteed to sell in their stores.
Under Max Rhodes leadership, since its founding in late 2016, Faire has raised more than $115 million in venture financing, grown headcount to more than 100 employees, and counts more than 25,000 active retailers ordering from the marketplace from more than 5,000 makers and brands.
Prior to starting Faire, Max Rhodes spent five years at Square, where he held many roles, including being a founding team member behind Square Capital, the first product manager for Square Cash, and Director of Product for Caviar, Squares food delivery service.
Before joining Square, Max Rhodes was a consultant at Bain and Company. A former small business owner, Max Rhodes feels passionately about the positive impact of local commerce on society, and he has made it his mission to use technology to solve the biggest problems faced by the small business community.
He holds a degree in history from Yale.
Connect with Max Rhodes:
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FULL TRANSCRIPTION OF THE INTERVIEW:
Alejandro: Alrighty. Hello everyone and welcome to the DealMakers show. I’m very, very excited about the guest that we have today. I think we’re going to learn a thing or two about creating and scaling hypergrowth businesses. Without further ado, Max Rhodes, welcome to the show today.
Max Rhodes: Thank you so much for having me.
Alejandro: How was life in Oklahoma being born and raised there?
Max Rhodes: You know, it was a great place to grow up. Not a place that I decided to stay for all that long. I left when I was 18, but it wasn’t that different from growing up. It was a college town, so I think honestly, it reminds me of Berkeley or Palo Alto. Just that summers are hotter, and the winters are colder.
Alejandro: Why did you decide to go to Yale and study history?
Max Rhodes: It was a combination of a couple of things. I knew I wanted to play soccer in college. At the time that I applied, they actually had a pretty good soccer program, it immediately went downhill. We won the Ivy League my freshman year, and then I don’t think we’ve had a winning season since then, almost 15 years later. I don’t know if there’s a causal like that, but I think it’s definitely not gone well more recently. I wanted to get a really good education. It was something that was important to my parents, and something that was really important to me. I’ve always been pretty intellectually curious, and history specifically at Yale. I’ve always felt like you can learn a lot from the past. I think history really has a way of repeating itself. In almost everything that’s happening today is really some sort of replica of something that’s happened in the past. So, the better you understand the past, the better you’re able to understand the present.
Alejandro: Oh, for sure. I think that the past always projects in a way or another in the future, so I think that just from entrepreneur to entrepreneur, I’m sure that you probably relate to reading biographies of other founders, how they did it, lessons, mistakes, and there’s something to learn from that. That’s all history.
Max Rhodes: Absolutely.
Alejandro: Yeah. So, you did then a little bit of corporate America. It’s amazing, but I speak with so many founders that are incredibly successful just like yourself that have been in consulting and either Bain or McKinsey. It’s the same thing. What did you learn from your time at Bain?
Max Rhodes: I think that the most important thing I learned is how to break down a problem into its component parts and really understand the root cause of problems and how to reason from first principles to find solutions. Something that I say a lot, “It’s impossible to solve the problem if you don’t understand the cause.” I think it’s really easy to end up in a situation where you’re treating symptoms and not actually treating the disease. I think that’s something that Bain, and I’m sure the other major consulting firms do. They teach you how to really make sure that you’re being rigorous, looking at the data, and really understanding a business problem deeply before jumping into solutions. And I think the other thing that’s been really helpful from that experience is just the network. We’re a little over 100 people now, and I think 12 or 13 of them worked at Bain. Three or four of them were in my Star Class at Bain, so the network has been really powerful as well.
Alejandro: That’s really cool. Yeah, the network. Especially, I see this because I have a lot of friends as well from McKinsey, like how they all know each other is like a small circle and actually pretty cool. One thing that I saw is that before you actually got started as a founder yourself, you had the experience of really being in a rocket ship, and that was Square. You were there for almost five years. How do you land on Square because, before that, you were at AppDirect, and what did you learn at Square?
Max Rhodes: Yes. I think it was pretty lucky the way I landed there. I ended up on a soccer team with the COO of Square. It was just total happenstance. Actually, he’s one of our investors now at Faire, our first board member. His name is Keith Rabois. He wasn’t great at soccer.
Alejandro: Hopefully, he doesn’t listen to this.
Max Rhodes: I don’t think he would be offended by it. He was an unbelievably smart guy, and after the game mentioned that he was in startups. I said that I was interested in startups. We ended up getting coffee and learned a little bit more. I didn’t even know about Square at that point. We stayed in touch over the next few months and that ultimately led to when he was ready to start hiring business analysts, people with my background, I got the callup and just really at the right place at the right time. Then in terms of what I learned there, just incredibly fortunate to have that experience. I think Square is one of those rare companies that started out hot and then really got it right from day one. We definitely made mistakes along the way, and I think there’s a lot to learn from mistakes, but I think that you can also learn a lot from successes, and I tend to think more about the things that Square got right as I’m building Faire than I do about the things that Square got wrong. I think the big things that Square got right were 1) having a really clear idea of what the mission and purpose of the company was. That was really all about financial inclusion and just leveling the playing field for small business owners. That was also a mission that I got really passionate about. That is the mission at Faire as well. I think I saw the power that technology could have improving people’s lives, especially small business owners. Previous to Square, in Shopify and some of the newer companies, there’s not been that much of a focus in the technology industry outside of Intuit on small business owners. I think that Square really blazed the trail in terms of what’s possible there and I think Faire is really continuing a lot of the things that we learned in terms of just creating tools that help small business owners compete with larger competitors. I think the other thing that I learned there is the power of focus on problem-solving. I think that Square did a really great job of always focusing on the #1 problem that we were facing using data to guide. Jack always felt that instrumentation and always having instrumentation of understanding what’s going well, what’s not going well, and just continually iterating and improving problems. Then the third thing and maybe the most important thing, Square just had this unbelievable culture of innovation. Sometimes, it felt a little chaotic, and I think back on some of those early days. There were some pretty wild moments. Sometimes, it felt like we could use a little bit more focus. But I think ultimately, that culture of innovation where people weren’t afraid to try things and fail where risk-taking was encouraged, where really entrepreneurial people were hired and empowered. That’s ultimately what has allowed Square to continue to innovate and be so successful. That’s something that we have really tried to do at Faire as well, where we actually are new-employee orientations called Founders Boot Camp where we really think of our mission as empowering entrepreneurs. Not just outside of the company, not among our customers where we have small business owners on both sides of the marketplace, but also within the company where we think of everyone here as part of the founding team, especially in these early days. I’m really thankful for the experience that I was able to have at Square, where I was able to work on really early projects like Square Capital. We got that off the ground. I basically put together a pitch deck, went and talk to a bunch of customers, and then went and presented to Sarah Friar, our CFO, and Jack, our CEO. They gave us the green light. We got engineering resources. Ultimately, we were able to bring our head of risk, J. Bryan Scott on to lead the project and get that off the ground, and now it’s a huge business. Cash was always basically the same way where we started out in a small room. It was like ten of us. Actually, both my co-founders were also on that project in the early days. There’s like a two-year period where it wasn’t really working, and we just kept being given space to try and innovate. There was a belief that it would work. Ultimately, Cash is now a huge part of Square’s business. Both of those were treated as startups within Square. I think that’s an approach we try to take at Faire as well. We’re just continually launching new experiments. Not being afraid to try new things. Not being afraid to make big bets while still maintaining a focus on the overall strategy, how it all ties together, and making sure that we are solving our most important problems.
Alejandro: Got it. We’re going to talk about what you’re up to now at Faire, but it’s interesting because the way that you talk, the listeners must be thinking like, “Man! Did he just say, Jack Dorsey?” So, I’ve got to ask you this because now, you’re really leading your own thing, and at that time, you were really learning from really incredible people. Keith, we’re talking about the guy from PayPal. Khosla, now I believe he’s Founders Fund. I think that was recently announced.
Max Rhodes: Yeah. He was the founder of Open Door.
Alejandro: One of the best operators out there. If I had to ask you what have you seen or what are the takeaways from working with someone that has been able to develop mastery at an operator level? Also, what have been your takeaways from working with and really reporting to someone like Jack Dorsey who is arguablymany people are calling him the next Steve Jobs and one of the best visionaries out there. What are your takeaways from really working with a visionary that has the mastery and the operator that has the mastery?
Max Rhodes: Yeah. I think Keith and Jack together were a big part of what made Square, Square, and what ultimately made Square successful. I think that a lot of that DNA, two very different approaches to building companies were brought together at Square that has proven to be really powerful. We’ve tried to marry those two different approaches at Faire as well. I think the big thing from Keith is he is better than anyone I think I’ve ever worked with at distilling information down to the things that really matter. I can remember presenting work to him, and knowing that there were maybe a couple of areas where the analysis was soft, or where the conclusions didn’t feel quite right, and he would always just jump straight to it, and unravel it, and then help to build on the big game. Just the amount of horsepower and the ability to synthesize information, and then use that information and use those insights to drive the business forward. When I talk about Square was so good at focusing on the most important things, I think that Keith was really exceptional at that.
Alejandro: What about Jack? What do you think made Jack so special?
Max Rhodes: I think with Jack, his ability to understand the way that people respond to brands and experiences and really having a maniacal focus on that is really unbelievable. I can remember on Cash, when we first launched Cash it was this email-based product where you had to cc: email@example.com. You’d put the payment amount in the subject line. It would appear to be a payment product and super innovative. Got a ton of press. Walt Mossberg wrote about it in the Wall Street Journal. We were really excited about it. Almost from day one, Jack wasn’t happy with it and just felt like it was the wrong approach. He felt like he needed to create a native app experience and get it out of email. It took us probably nine months of him just patiently saying, “When are you going to fix this problem? When are you going to fix this problem?” Then finally, I did a bunch of customer interviews where I actually talked to people that were using the product, and sure enough, almost all the problems that people were having were spinning from them just not having a consistent enough experience to try to send payments over email. Sometimes, the emails would fail. It was just a very unstructured and difficult to use product experience, even though it was really innovative. So, his ability to see that from day one really jumped out. I think a lot of the products that he’s built have this really impressiveTwitter. Who would have thought that 140 characters sent out into the ether would take on this life of its own? I think he really has that product vision of understanding how people are going to respond. Both within the experience, and then also in the language that is used, and the colors that are used. He’s almost like an artist in the way that he builds products and build experiences. I don’t know if I’ve figured out how to do that. I think it’s a pretty unique skill, but we’ve tried to replicate some of that at least at Faire. The thing that both of them were really amazing at is recruiting. I think that when you look at the management team that Jack put together, and when you look at a lot of the people that Keith hired at Square, super impressive. Keith hired Tony Xu who went on to be the CEO and founder of DoorDash. He hired Jeff Collinson who’s now our COO who just joined a couple of weeks ago and actually was originally one of our co-founders, and then went on to lead revenue at Open Door. He hired Adam Hann who is now the Chief Product Officer at InstaGuard. He hired him back at LinkedIn. He just has this really amazing ability to identify talent. Then if you look at the executive team that Jack hired, Gokul, Sarah, incredibly impressive people. Both identifying those people and then recruiting them and getting them to buy into his vision. I think that has a lot to do with what made Square successful, and it’s their ability to build those great teams. I think that’s something we’ve worked really hard on making sure we try to create at Faire as well.
Alejandro: So, let’s talk about Faire. How did you incubate this idea because, obviously, ideas take some time to come to fruition? What was that day like where you said, “We’ve got the right guys, the right founders, let’s pull the trigger?”
Max Rhodes: I think the founders actually came first. Originally, it was me, Marcella, and then Jeff who just rejoined us as our COO. All four of us worked really closely together at Square, and we felt like we had really complementary skill sets where. I come from a product background. Danielle comes from a risk, security, and data science background. Then Marcella is an incredible engineer. He was actually a barometer at Square. He set the hiring bar at Square which has proven to be a very valuable skill when building out our engineering team of being able to identify a top tech talent. Then Jeff is just an incredible operator, led the retail team at Square, led operations for Caviar, great team builder, really understands go to market. When we were starting out, we felt like we had all the building blocks in place. We all had entrepreneurial experiences, wanted to start companies. We’d been talking about it for over two years before we all made the leap. Then specifically with this idea, we went through three or four different iterations of different ideas. We worked on a car insurance startup. Marcella and I spent a few months trying to sell dental drills which is a very long story that I won’t go into, but you can imagine why that didn’t work out. Then finally, we started working on this one. It was almost immediate that we knew it was the right idea. It just felt right almost instantaneously. I think it was because we were solving a problem we understood really deeply. We had the experience from Square working with small business owners. We really understood the customer. Then I specifically had the experience of introducing the Blunt Umbrella to the U.S. market. I saw up close how painful it is trying to get products into stores. I saw the pain on the retailers’ side of how risky it is and how much fear there is when bringing on a new product. So, this idea of being able to underwrite the inventory risk and actually allow retailers to try products with free returns felt really revolutionary. We were just excited about it from day one. Then as we started talking to customers, you could just see the look on their faces that we were onto something. You could tell that there was a level of excitement. I’ve worked on products that have failed. You’ve probably never heard of [21:29], and that was a product that I worked on. There’s a reason you haven’t heard of it. I worked on products that were successful. I had some intuition around what that felt like when you were talking about something that was really going to work. This had that feeling. You could just feel it in a room when you were talking to retailers about the idea.
Alejandro: When you came up with this idea where you were testing all these different concepts, were you already in Y Combinator or Y Combinator came after you had already set your eyes on this?
Max Rhodes: You know, we decided to apply to Y Combinator almost two weeks after we decided on the idea. So, it turned out to be a really good forcing function for us to really hone in on exactly what the customer pain points were we were trying to solve. The timing was really fortuitous in a way and ended up using the Y Combinator application to develop the initial hypothesis that ultimately led to Faire. Then really started testing it. We actually started working fulltime on the idea, me, Marcella and Danielle (Jack had left at that point) the day that Y Combinator started.
Alejandro: Got it. Then one of the things that I always say to founders because right now there are like 450 accelerator programs out there. There’s just so much noise on the space about this. I think that most of them are full of noise. I think that the one that really makes sense is Y Combinator. Really. Otherwise, it’s probably best to just grab that equity and give it to a bunch of advisors and good people that can get involved. I guess what makes Y Combinator so great?
Max Rhodes: Yeah. I don’t have much experience with other accelerators. I can definitely talk about what made Y Combinator so valuable for us. The first thing is it creates a pace of play where you’ve got this three-month period, and you’ve got all these other great entrepreneurs that you’re working alongside and great advisors. We were working really close to Sam Altman. He was our group advisor. They are just telling you over and over again, “Talk to customers, understand the problem that you’re solving, build your product, don’t get distracted by anything else.” It’s almost like you’ve got a ray gun pointed right at demo day, and the only thing you need to worry about is getting traction, proving product/market fit. For us, that was really powerful. It think it created this sense of urgency and focus that we’ve maintained to this day. I think there’s definitely a bit of selection bias where, for sure, great companies apply to Y Combinator, but I think there’s a reason why you see so many great companies come out of it. I think a lot of it has to do with that focus and urgency that they help to cultivate. Then I think there’s also something to be said for just having 100, 200 of the best investors in Silicon Valley all lined up on one day where you have the opportunity to go and talk to them. You can run a really tight fundraising process, and that’s ultimately what introduced us to Alfred Lin. Chief investor in that round, forerunner. [25:06] invested in that round, and those are amazing investors that I don’t know if we would have had the chance to get in front of if we hadn’t done Y Combinator.
Alejandro: I agree. Alfred is really unbelievable, so definitely one of the best investors out there, and also a great, great person because you want great people to be involved. That’s fantastic. That was going to be one of my questions. In total, how much capital have you guys raised that is publicly disclosed?
Max Rhodes: I think 160 million.
Alejandro: 160 million. One thing that stood out for me was that typically you raised rounds anywhere between 18 to 24 months. For you guys, it was unbelievable because you’ve done two rounds in 2017 and three rounds in 2018. So, literally in the same year, you did your A Round, your B Round, and your C Round. I’ve heard something like this.
Max Rhodes: Yeah.
Alejandro: Well, what happened?
Max Rhodes: I think we were pretty fortunate is what I would say. The first idea worked which is pretty unusual. I think you look at Slack; you look at Airbnb. You look at a lot of really great companies that took them a while to find product/market fit. We just happened to land on the right idea from day one. So, the result was that we started growing very fast, very quickly. Then I think we also were fortunate to move through the different phases of the startup very, very fast. I think of a startup where the initial phase is really finding product/market fit. The next phase is figuring out your business model. Then the next phase is figuring out your growth model. Sometimes, those things can happen. In concert, they don’t always necessarily happen in that exact order, but for us, they did where it took us nine months to really have traction where almost from the day that we had the product built and launched, it just took off. Then we were able to raise our series A on product/market fit, traction. It took another nine months to nail the business model where we were unit economic-positive. Then almost the month we nailed the business model, shifted the focus over to growth and really growing the business, that month we raised our Series B. Then the growth model really took off. So, we went from doing a little over a million a month at GNB to 8 million a month in GNB in like three months. So, that’s what led from the B to the C. So, when I think about fundraising, I think about it as milestones, and what are the milestones that you need to hit to reach that next gate to feel good that you’re going to be able to hit the next milestone, whether that’s your A or B or C or D or becoming a public company. We just passed through several of those gates on an accelerated timeline.
Alejandro: Talking about growth, how many employees do you guys have today, Max?
Max Rhodes: Right around 100. I think 106.
Alejandro: And why Canada?
Max Rhodes: We had one part this week, so Im not sure if it’s 106 or 112.
Alejandro: Got it. Well, hopefully, they don’t get offended, so maybe you can invite them for a drink or something. So, Max, why Waterloo, Canada for the engineering team?
Max Rhodes: Yeah. Total luck is what I would say which is a common theme here. Marcella, my CTO, has 20 years in software engineering experience. He was really early in the Google office out in Waterloo. He’s from Brazil, settled in Canada, got a job at Google. I think he was like employee 20 or 30 in the Google office out there which is now 500 or 600 people. Then he was the second employee in the Square office out there. That’s actually where we built Cash Engineering. That’s now 100 or so people. Marcella just has this amazing network. He has experience in building engineering teams out in Waterloo specifically. I love Marcella. So, we were actually concerned about it initially that we heard from a lot of investors, “You can’t build a company with engineering teams and product teams in a different location.” We knew that wasn’t true because we did it with Cash. Cash was almost completely remote, so we learned how to do it. We had confidence that we could do it. What I think we didn’t realize at the time and why I said it was locked is that it’s actually kind of superpower for us. University Waterloo is one of the best engineering programs in the world. A lot of people don’t realize this, but Blackberry was built out of Waterloo. I think in large part because they had access to that great talent pool there. You know, recruiting engineers in San Francisco is just brutal. We’ve tried to do it. We’ve tried to build a small team here. One of the best engineers I’ve ever worked with, I got dinner with him a couple of weeks ago to try to recruit him, and he said to me, “I’d love to join, but the company I’m at right now actually gives me three months off in the winter so I can go moose hunting.” I was like, “Well, that’s great for you. I don’t know that that’s going to work for us right at the moment. Maybe let’s stay in touch.” In Waterloo, you just don’t have the same sort of competition for talent. I really do think the technology companies increasingly are competing in two markets. You’ve got the market where you’ve got your customers, and then you’ve got the talent market. You’ve got to figure out ways to differentiate yourself. In the talent market and for us, Waterloo has proven to be a huge advantage. We’re one of the most successful companies there. There just aren’t that many Sequoia [31:34] startups that have reached the kind of traction that we’ve reached out there whereas, in San Francisco, we’ve been successful, but there are a lot of other companies here. The ability to stand out there, to recruit really great engineers. I think we have one of the best engineering teams around, and I think that has a lot to do with Marcella’s ability to recruit.
Alejandro: Yeah. I think that it makes complete sense. I had a similar experience building my last company here in New York City where in one of the interviews, one of the engineers said, “Is there unlimited vacation?” I was so shocked because here I am, coming from Spain. I hear that, and at that point, I said, “The engineering team is going to Barcelona.” So basically, I did that, and that was a great excuse to have tapas from time to time.
Max Rhodes: Yeah, that’s another nice perk. I don’t know how I can compare Waterloo to Barcelona.
Alejandro: Hey, I’m sure it has its positives, but in your case and perhaps the people that are listening are starting now to think about, “Maybe the remote or the new location where I don’t have to deal with all this competition where people are only staying for a couple of years, and maybe I create more loyalty by being somewhere else.” What kind of recommendations or things that you’ve learned of being effective at having a remote location? What have you learned?
Max Rhodes: I think the number one most important thing, just an absolute requirement, is you need somebody that you can build the team around. That person needs to be pretty special, almost a founder. They need to be able to recruit. They need to be able to lead; they need to be able to help make business decisions and translate the business decisions to the engineering team to communicate and rally people. They need to be able to hold people accountable and create results. It really does take a special person to be able to build an office around. I would say that is the number one requirement. I think it’s important that they already have a network there because solving the cold-start problem is really hard. It was difficult for us even the first year or so with Marcella’s network to pull people in. The second thing is that you really have to invest in the technology and the processes to make it feel less like a remote team. We’ve invested really heavily in Google Hangouts. We have big TVs, cameras in every room with high-quality sound systems. We’ve spent a lot of money on our all-hands setup so that it really feels like when we do our weekly all-hands that everybody is all together. You have to be willing and ready to make those investments. Then you just have to be really good at communicating, which in a way, I think becomes an advantage as you scale, because a lot of the problems that you run into as you scale are things that used to work when you were all in a room together stopped working, and so you have to solve those communication scaling problems earlier on. Then you just have to travel. You have to be willing to get on a plane and go and visit one another because there’s really no replacement for some time spent together. We try to get our product teams together at least once every six weeks. I’m out in Waterloo every other month. I’m about to be out there next week. It takes an investment. It takes sacrifice, but I do think it’s worth it if you can figure out the right leader to build around.
Alejandro: Makes sense. Max, in a world where the vision of Faire is fully realized, what does that world look like?
Max Rhodes: At a high level, our mission is powering the shop local movement. So, when I think about the future that we try to create, we always say the future is local. That’s one of our taglines because we think that ten years from now, local retailers are making a comeback. You’re already seeing the beginnings of it. For the past 100 years, local retailers have had their backs up against the wall trying to compete with Walmart, Target, BestBuy, and all these category killers like Bed, Bath, and Beyond. The last 100 years of retail history has been shrinking market share for local retail. You’re now starting to see the green shoots of local retail actually bouncing back. The number of independent bookstores is increased by more than 10% every year since 2011. Independent grocery stores are coming back. Independent pharmacies are coming back. You’ve got main streets all across the United States that are starting to revive. We’ve got strip malls starting to collapse. The reasons for that are first of all the big box retail apocalypse is a very real thing. These stores collapsing are mostly because they’ve just taken on too much debt. Private equity companies levered up and over-expanded, so these companies basically can’t pay their VISAs and their interest payments, so they’re failing. That’s bringing white space for smaller retailers to fill. The year that I mentioned, 2011 when independent bookstores started coming back, that was the year Border’s went bankrupt. The other reason and I think the more interesting reason, is that these stores have figured out how to survive in a world where they can’t offer the lowest prices and the largest assortments. They figured out how to compete with Walmart and all those big box stores that I talked about by offering differentiated experiences, by offering curated assortments, by really offering amazing customer service and setting themselves apart. When you walk into a local shop, it’s an experience. When you hear about what Nordstrom and REI and Best Buy are trying to do to pivot and compete with Amazon and compete with somebody who has lower prices and larger assortments, it’s the things local retailers have been doing for several decades now. So, they’re really well positioned in many ways to survive in this post-Amazon retail world. The big thing that is holding them back is the technology. It’s the fact that all the innovation that’s happened in retail over the course of the past 100 years has happened among big box retailers and now among online retailers. There’s been very little innovation among small retailers, and we think that we can use technology to level the playing field for our stores. We have 25,000 stores today. To put that into context, there are 27,000 Starbucks locations in the world. So, that gives you a sense of the scale of our network. By the end of this year, we’ll have 100,000 stores, and we think five years from now, we’ll have a million stores. When you add up all of those stores together, they are actually bigger than Amazon, and Walmart put together. When you take that scale, and you take the ability of technology to help them make better buying decisions, to help them manage their inventory better, to help them allocate capital better, and ultimately, I think to help them connect with consumers, you’ve got a really, really powerful combination. I think ten years from now, a lot of the advantages that big box stores have had will go away, and you’ll be left with consumers making a choice, “Do I want to shop local or do I want to shop at a big box store?” I think consumers are going to go with the community experience that local retailers can offer. I think we can be a big part of that.
Alejandro: That’s really, really interesting. So, Max, you’ve been involved with rocket ships, leading different departments and products. Now, you’re actually driving your own baby, your own rocket ship. So, you’ve seen quite a bit on what works, what doesn’t work. I guess if you had the chance to go back and speak to your younger self, what would be that piece of advice about business that you would give to yourself and why?
Max Rhodes: I think the biggest thing is just be patient. There were several times in my career where I think I got a little impatient, and when I think about the mistakes that I made, they really came down to being overeager, thinking that I knew more than I did, and trying to jump forward in my career, and getting ahead of my skis. When I think about the good decisions that I made, it was when I was willing to be patient. I think of a couple of examples. I thought about going and starting a company right after Bain. I was convinced partly by Keith that I needed to go and actually learn the trade. Entrepreneurship, I really do think is a craft, and I think it’s something that can be learned, and I think the best way to learn it is to jump on a rocket ship and see how to actually build it. But that also takes patience. There were definitely moments where I wanted to get out of there, and I wanted to go and start my own company because that’s what I’ve always wanted to do. I think I was really lucky to keep getting opportunities that were exciting enough and gave me enough of that entrepreneurial experience that I was able to stay patient. Another example I think is with the Capital experience. I mentioned that I got Capital off the ground. I wanted to be the one to build Capital. I wanted Capital to be my product, but I realized that I wasn’t ready yet. So, we recruited J. Brian Scott who was the head of Risk at Square, just a brilliant guy. He was a little further ahead of me in my career. I was able to learn a lot from him, and he ultimately did an incredible job of building Capital up. I’m not sure that I would have been ready for that experience at that time. I think I learned a lot from the experience of working for JVS. Then I also had the opportunity to go and then work for Brian on Cash, and then go and work for Gokul at Caviar. Those are experiences that require patience, and I think require some level of humility of recognizing that I still had a lot to learn from these incredibly talented people. That would maybe be the other thing that I would add is just seek out unbelievable people that have accomplished amazing things who you can learn a tremendous amount from. The thing underneath all that, both the patience and the seek out amazing people is just always be learning. Don’t assume that you know anything because the further along that you get in your career, the more you realize how little you know and how much you have to learn.
Alejandro: I love it. It’s interesting. I agree with that, with patience because we as human beings, we underestimate what we can do over time, what we can learn over time, so I think those are really good pointers there.
Max Rhodes: The last thing I’d say is that we’re hiring, and if you are interested in working at Faire and if it’s something that excites you, you definitely feel free to email me at firstname.lastname@example.org Please do feel free to reach out.
Alejandro: Amazing. Max, what is the best way to communicate with you for example on social media?
Max Rhodes: I’m on Twitter a bit – @maxrhodesok Feel free to follow me. I don’t tweet much, but if you want to check out media posts about Faire, that would be a good place to find them.
Alejandro: Amazing. Alrighty. Well, Max, it has been a pleasure and an honor to have you on the show. Thank you so much.
Max Rhodes: Thank you so much for having me, Alejandro.