Bill Spruill: Leadership Lessons from Growth & Exit

Bill shares three leadership lessons in his 10+ year journey co-founding, building and selling Global Data Consortium to the London Stock Exchange Group in 2022. GDC has experienced 120% YoY growth with a global team of employees across six time zones.

He discusses his experience building and selling the company successfully so that he could pursue a new goal, to support the entrepreneurial ecosystem in Raleigh, NC.

Slides

Transcript

Bill Spruill
All right, I always have to be a little bit different. We’re going to start that there.

I’m actually going to start up this morning with a story that I haven’t shared with a lot of people it was about midway through this journey to exit. I’ll try to paint the picture a little bit for everyone: I was in London, walked into a restaurant in the shadow of St. Paul’s Cathedral – steakhouse there. And I was meeting with the COO of a company pub traded company there in the UK, who was also a good friend of mine and confidant in the business. It had been a very interesting week, there had been a lot of different energies along the way, we had some conflict energy. We had some helplessness, toleration, whole lot of things on this particular trip.

So I was eager to sit down with someone face to face, and actually just talk about what I was feeling. And the conversation started off with, you know, ‘Nick, I’m about to sell the business. Here’s the price we’re talking about. But I don’t know if I should do this yet. I’m not sure I want to sell the company yet. What do you think I should do? Should I go after more? Should I take this deal? What should I do?’ Nick took a sip of his wine. Calmly smiled at me. And he was recovering actually, from a pretty heavy bout at COVID. So he kind of had this weak smile. He wasn’t at his best energy level. But he summed it up for me and said, Bill, simple answer to your question. How much is enough? How much is enough?

Basically, the amount we were going to receive for the business was a pretty heavy amount. We and you know, I’ll jump there is later in the slides. But we sold our business for $300 million to the London Stock Exchange. So pretty sizable exit for my co founder, myself and the rest of the team. So for me personally, it was way more money that I could ever spend within a reasonable construct in this lifetime at my age. And that’s what Nick was sort of pointing out. He’s like, you know, you’re not 20 something. Yeah, you’re 50 Bill, actually 55 Bill, how much is enough? And at that point, I realised I made a decision. In hindsight, when I’ve reflected a lot at that, that was the point where I realised we’re going to sell the company.

So I started in the middle. But let’s step back and talk a little bit about origin stories and what we’re going to do today. So to start us off, I’m going to tell you a little bit about myself, my background, where I come from, because it does matter. I’ll talk a little bit about the business GDC, global data consortium, digital identity provider, and then I’ll talk a bit about the exit and some key points around the deal terms. And then it’ll get a little more exciting. Hopefully, we’ll get through this little boring bit. But it’ll be a little more exciting. We’ll talk about some learnings I had that will hopefully help some of you at some point along those journeys, whether you’re at the start of building your business, or closer to the end where you’re actually having these thoughts about whether you want to sell I think some of these learnings frankly will be of great use to you. But most importantly and hopefully where you’ll see more of the energy come out for me is frankly, what’s next and we’ll talk about the house of good deeds.

Origin Story

All right, so origin stories. I wonder anybody know the name Hugo Drax? Does that name strike a chord to anybody in the room? Okay, maybe I’m an age to individual. How about Ernst Stavro Blofeld? we’re getting there. Victor Von Doom? And my favourite all time favourite, the Master for those who are Brits will certainly know that’s from Doctor Who. So I just rattled off a list of villains. And you know for me growing up as a young child in rural North Carolina those villains were actually my idols. So, all right, let’s stop there for a moment say what does where’s this going? Why does this guy love villains? Well, the reason I love villains was these guys went out and took dreams and put them into reality now Yeah, yeah, yeah, it was fake. We all know they weren’t launching space shuttles from the jungles of Brazil, or anything like that. But growing up as a child, these were the people, these were the entrepreneurs that I had access to.

These were the people who are going out and say, I have a dream around a conviction around something, a mission. And I’m gonna go out and do it. And those were some of the early progenitors of people who helped me build with my particular neuroses, the character that I became along the way. So frankly, this slide is worth a lot of money to people. Let’s just be clear, these photos have not been seen by most, I already see a couple people from Raleigh shaking their heads. Yeah, this is going to make the rounds. But you know, it’s worth sharing this, the slides. So had a very interesting childhood growing up, rural North Carolina. Absolutely there. You know, born and orphaned in rural North Carolina. So I was adopted, and then actually lost my adopted father in Vietnam. My mom was a teacher. And so she raised my sister myself, alone, well, in conjunction with the rest of her family. In her particular case, she was the first generation off the farm to go to college, she was the first one of 10 kids that went to school, she became a teacher. And as a result of all of that, she spent a lot of her time and energy outside of raising us helping to raise the rest of the family. And so that that’s why that picture in the middle and Yes, that’s me in that blue shirt, with far more hair at that point in time that I do now have now. The woman sort of sitting there in the middle smiling is my mom sitting beside her is my aunt Priscilla. And my aunt Priscilla was a housekeeper. And most of my family members had jobs in that socio economic malaise. And while it was a struggle, existence, it was a happy existence. And we got taught a lot of good moral codes along the way. So I thought it was important to share that with people coming from this very small community.

Now, I got out of that community as quickly as I could, when I graduated high school, and I went to LA to pursue my engineering degree, went there in the late 80s, during the peak of the AIDS crisis. So let me take that one a little bit further, you’ve got a gay, black male from the country, Goldsboro, North Carolina, going all the way across the country to LA in the mid 80s. Let me tell you something, when I got off that Greyhound bus, it was a different experience. And the next four years were actually a very different experience. I survived those four years, moved on in my career, did well, and so forth. The point to this particular slide was, you know, we don’t think in terms of our origin stories a lot of times and where our need our drive to build things come from. I spend a lot of time reading in school, I spent a lot of time at the library because that was a place my mom could park me and my sister while she had to do things as a teacher. And I ran through the Sci Fi section in a library. I you know, so I, yeah, everything you know, that they got in I read pretty quickly. And that’s where that thirst for knowledge for something bigger, better, I was able to dream. I had the ability to dream. And that’s why the villains became important because I actually saw where they were able to take their dreams and make something real bigger, and I decided I was going to do the same thing.

Now one other bit today, I’ll talk about with Goldsboro. So, one weird, fun fact. And I don’t know if it was something in the Neuse River at that time, or what, but one other boss attendee Carl Ryden. We actually share the fact that we grew up in Goldsboro, Wayne County. We grew up less than actually about 15 miles away from each other. We both had socio economic struggles. We both got out of Goldsboro and thought of doing something bigger. And darn it if CArl didn’t actually sell his company for more and take away my title of having done the bigger deal in Goldsboro along the way,

Good problems for us both to have. But it is definitely something that I actually found to be amazing when I actually met Carl the first time. So by the way, you may see me refer to my note cards up here, I’m just coming off of the number one thing that founders do after they exit, and that is take a trip, take a long trip with their families, I just did a month eating and drinking my way across Spain, the Balkans, and Germany. And now, now that I’m back, and I came straight here from there. Now that I’m back I’m going to do the number two things that most founders actually do after they exit. And that is actually tried to get my butt back in shape again. So just recognise this was one of those things that I had to get this together just ahead of the conference this week. So you’ll see me refer to note cards to make sure I cover off the topics adequately.

So early career, I ended up working at SaS Institute and business development, software business development, this was a started my career in enterprise technology. I had a prior career as a flight engineer, I actually also used to trade currencies. I was also very active in the independent film community at one point along the path. So I bounced around a lot in this particular lifetime looking for paths to build. I didn’t realise it at the time, but I was developing what my eventual superpowers were going to be throughout that entire process. And then once I actually develop them and once I became self aware, figured out what those superpowers were. Then I applied them in the enterprise technology space because I realised that’s where I can actually make a lot of money.

So started off working at SAS Institute. It was a great career building exercise for myself. And you know, loved working for the organisation, but also hated working for a big organisation, I recognise that pretty quickly on left SAS and went out, went independent. Along the way, I was part of three different exits;

Address Doctor. German data company that was sold to Informatica large enterprise player out west

Was an investor advisor to a company called locate, which also did address verification, which was acquired by GB group in the UK.

And then also helped to sell a company called Intelligence Search Technologies, which was acquired by Xperian.

So, yeah, I’ve had multiple experiences around exits before. But also, more importantly, I’ve had multiple scenarios available to me, where I could off ramp or I could just be satisfied where I was at. Again, if we go back to that childhood slide I showed, for my mom, the best possible economic outcome for me was going to be to go to college, become an officer in the Air Force, because that was a safe branch to join. And, you know, get married, retire, making, you know, $60-70,000 a year and have benefits in her mind. That was, that was it, that was the step up, there was no construct at all of what I actually ended up accomplishing along the way.

So, any of the career paths with these organisations would have actually tripled what my mom would have ever thought what my family actually expected of me what the world actually thought I would be capable of, but I actually wasn’t done yet.

So we started Global Data Consortium. So first of all, I am not the sole founder, I am the co founder of GDC. My other sort of co founders in the back of the room, he flew up for the conference, a because he enjoys the conference would be I think he just wanted to heckle me from the back of the room periodically. So he is back there in the back Charles Gatti. GDC global data, what we did was, we created a digital platform for KYC Know Your Customer digital identity verification. We have customers such as Stripe, Pay Pal, remitly and DHL ecommerce, and we service those customers roughly across 60 countries around the globe. Oh, by the way, we never raised capital until 2020 started the business in 2010 didn’t rasie capital tool 2020.

So it started off with the two of us plus one engineer. And we grew it to a group of 40 people along the way prior to acquisition. And, yeah, it was a great, long journey. So some key fundraising points on this origin story piece that I wanted to share with you all. So the first few years, you know, we spent wandering around in the desert, how do we make money, we did anything for money, not quite anything, but almost anything for money. And we were really struggling to find product market fit at that time, we started off building a address data product, we had some traction, it wasn’t as good as we were hoping it would be. We did build a fully cloud enabled product that had some traction, not as great as we wanted it to be. And then something happened. And we actually flipped it into a digital identity verification platform, using the same data, same resources, same partners that we had before. And then the machine started turning for us. And it was a amazing thing from a growth perspective. But as a result of some of that process, we struggled to raise capital, no one wanted to invest in us beyond our friends and family. And we were really frustrated with that process, we could never quite figure out the why of that. A) you had, you know, two seasoned, you know, executives who had actually done this before had experienced in the industry I was a biz dev nerd. Charles is technical. So we had to right fit, founder market fit on that side. Why not invest in us? Why not take a flyer, and we were never actually able to get anyone to give us so much as $100,000 ever in that process. Early days, we met with a lot of investors kissed a lot of frogs, and none of them turned into anything other than frogs for us.

So, who knows, but you know, at the end of the day, maybe that wasn’t such a bad outcome for us. So the rest of this slide sort of just paints the picture, you know, 2020? Well, between 2016 2020, we hit it, and the machine really started to build and turn, we built this company pretty frugally and cash efficiently. We actually built it profitably. And that actually allowed us to actually have a lot of latitude around future discussions around fundraising and things that we wanted to do. So in 2020, we actually did do around in May of 2020. Yes, right, as COVID really kicked in. And the story there was really interesting because we had two partners, and I think was some of you, I was speaking about this at one of the tables yesterday. One of our partners, Experian, originally wanted to invest in the business, and they were going to do the round, we had it valued out we had everything down all the terms term sheets done. And then they retreated on us their CFO decided that they didn’t make a number on their side. So he somehow felt like they wanted to punish us for that exercise. So they actually tried to retrade the deal a little bit. And we said no thanks. And a company called Refinitiv. At that time jumped in and said we’ll do your A we’ll do it at exactly the terms that you want. And please will sign if you will do this in 30 days, fastest close ever on a deal on that side for for them.

So we closed our first round series A at about a $40 million valuation on $8 million in revenue. And then a year later, we decided we’re gonna go out and do our B. And that’s where it got really interesting because we had our B lined up. We had the family office of the Robertson family office, which some of you may or may not know that name. But the Robertsons were the progenitors of the Tiger Global Funds. So it’s a pretty serious family office there. And they very much wanted to do our, our series B and in fact, they wanted to do the whole round because they liked the company that much. And you know, we were all set to do that with them. We were going to have refinitiv (now LSEG) come in and do basically their pro rata and you know, happily ever after we thought we might be

LSEG said no. We’re going to lead the round. We want we want that lead position. We were polite and we said no. That’s not gonna work for us. We need to make sure we maintain our independence in the deal. And it got contentious for us and this was last August and at the end of that discussion, it led to us having a meeting to say, Well, if we can’t lead you around, we actually want to buy you. We want to buy the business.

And so I flew to England, we had that discussion. It was a bit of a contentious discussion, like I described at the very beginning of the presentation. But ultimately, I threw a fit, for lack of a better term, and told them to and I think, actually, Elizabeth [O’Neill], I want to thank you for A great session, but B you know, breaking the seal, because I can now say, I told him to f*ck off. And that led to a senior director from LSEG meeting me at my hotel and saying how much for the business, we took the valuation from 150 million to 300 million, deal done, handshake shook. And LOI signed about two, three weeks later after that.

So that gives you just kind of a snapshot. Last little bit on the origin story, so sold $300 million dollars 100% cash upfront. It’s a cool thing. Moving over to the right, the value we created in this because we actually built this company with the notion of sharing our equity as opposed to keeping it all for ourselves. We made over 40 friends, family team members, over $500,000. People earn $500,000.27 of those 40 people over earned over a million dollars. So instead of keeping it, we put it out there. On my side on Charles’s side, no golden handcuffs for us. We knew better than that, from prior deals. We actually negotiated maximum optionality for ourselves – no roles – Charles just Charles just recently left the business. I’m still there, we’ll see at the end of the week, if I am or not, but that’s a different thing. Completely different thing.

I’m going to bounce back up to the 40 and 27 number for a sec it because nothing could be better. We had to keep this deal a secret. So we signed an LOI in November of last year. And we couldn’t tell our team until May. It was the most ridiculous thing I had ever experienced in my life. Because we literally had to go through this diligence process. And all of these different things with the team that we had actually really upheld around transparency. Everybody was invited to board meetings. We had been uber transparent with our team. But we had to hold back on this because that was one of the terms of the deal.

Key Learnings

So the day that we actually had the all hands and announced a deal. It actually still It felt really, really good to watch people’s faces when they realise how much they were actually worth. I remember one of our engineers, Josh, who I thought he was going to have a fit. I thought we’re going to actually have to call EMS because his face went from You mean I’m worth? Yes. Joshua worth. What? How? Yeah, stuttering and that went on for a little while he left the room. You know, I was like, go get some cold water on your face or something. He came back. He was still kind of stuttering. But it was great being Santa Claus for a day. It was awesome on that front and wonderful. But in May, when we actually ended up signing the deal. There’s a bit of emptiness associated with that. I ended up signing doing my bit of the final DocuSign while I was in Singapore, in a hotel room, in quarantine, because I caught COVID surprise. Yeah, I finally ended up with it. In Singapore. The week I’m supposed to be closing the deal to sell my company, go figure.

And did all the docs did everything and then the next day, I actually ended up testing negative So I hopped on a flight immediately, you know, it’s time to go home, did the long haul Singapore to Newark, second longest flight in the world. And when I landed in Newark, booted up my phone and everything. And all the messages streamed in at that point. Company is not yours anymore, Bill. You’re not the CEO, you’re out. You’re not out, but it’s not your baby anymore. This deal was done. Yeah, my bank account was in a very different place. But I didn’t have my company anymore. And that was tough. There was emptiness associated with that, it still creates that emotional response when I think about that particular moment for me.

I’m sitting in the lounge, the Delta lounge waiting for my flight back to Raleigh. And it was like, well, crap, did I do the right thing? Yeah, I’ve got this, stash this war chest of money. But did I do the right thing? And I think it’s a really important thing to sort of emphasise during those type of moments, that emptiness, to make sure you get some help. Talk to some people. Whoever it is you need to talk to or there’s professional help, or just friends, family, whomever, make sure you talk that part out when you get to that part of the journey, should you get there. Because just sitting there with that emptiness is a tough, tough thing to do. I think I was having a breakfast conversation this morning, with someone and we were talking about that for a bit. You want to deal with that you want to talk to some people, you want to find your way through that, so that you can actually go back and enjoy the fruits of the labour that you put in for that all those years.

So that’s the origin story that now will start to accelerate a little bit. Yeah, the burn hand teaches best. I think this is a great, great exercise and thinking about what are the key learnings I took from this.

So number one, biggest learning leadership maturity. You absolutely founders are wonderful people, we have conviction, drive vision, we can do almost anything in the world. But if you get your company to the right size, you actually have to take on the traits of a really good leader. And leaders have to organise, corral, and remove the barriers; you have to delegate things out.

Basically, two years before we sold the business, we brought in a colleague of ours to become CTO. Charles has sort of held that title for a fair bit of time, but it was time to sort of advance and evolve the business and the team. So we brought in a guy who basically, you know, years and years of experience in that type of a role, we brought him and he became CTO. We moved our head of finance up and made him CFO. So our head of finance was actually a reformed founder. He tried to do a startup, it didn’t quite work out for him when he came to me and said, Hey, Bill, I think I need to find a job. I said, Well, given you’ve got this background in private equity and venture financing, I think I know the job for you. So we we brought him in as, as our director of finance moved him up to CFO, we then also hired a general counsel as well. We hired a guy who had taken two company’s IPO, his wife was a senior executive with Moderna. And frankly, they didn’t need the money, he just was looking for the fun to do the work. So he was the perfect GC for us to bring in on the team perfect culture fit perfect everything.

And when we brought those people in or elevated those people, the thing we did was to delegate out all of the responsibilities that Charles and I had had for years and years. So no longer were we making every single decision in the business, we push that down to those individuals to make those decisions, those final decisions. And that’s important for you to remember; as a founder, you’re used to making every decision and having it all on your back. As a true leader, you’ve got to delegate out and put it on the backs of people who you know, can do the job better.

And that gives you the ability to then go out and remove the other barriers and do the other things that you need to be doing as a true leader in the business. Another key point there is maintain that focus execution all the way through, I think, I think it was Dharma said that yesterday, focus executions, one of our mantras, I’m a big believer in do one or two things really, really well and say no to all of the rest. I became known as Dr. No for a time as head of our company as a result of that another Bond villain the reference there. But you absolutely have to have the ability to say no, if you can’t say no, you will get more distraction in your business. And that will knock you off the rails. One of the things I will say loved about our business was that we were very focused on data driven, API driven identity verification. We didn’t try to build a big platform. We didn’t try to say we were everything to everybody. We sold to fintechs and payment processors and people in the crypto space. Everyone else, not our cup of tea at that point in time for the business. So we had a very, very tight message. Very, very tight product offering and we were delivering in a pretty smooth and flawless way. So leadership maturity. Founder must evolve into leader or bring in other leaders recognise that you can’t make that evolution and bring the leader in so that you do well by the business.

Next key learning. So, number one question I’ve been asked, of course is why did we sell? That’s always the question. Why did you do it though? What was what was it about? Was it the security aspect, we always think about derisking, we’ve put our Blood Sweat Tears. And oh, by the way, most of our savings and personal mortgage guarantees and everything else. You need security for your families? They’re also looking at you, by the way, saying, where’s the money? Where’s the success in this? Where’s the outcome? And typically, that’s the case. So security is usually the number one reason why people sell. Number two would be exhaustion, you know, 12 years, you know, you work at something for 12 years, and it can wear you out, it can absolutely wear you out. And that’s a very valid reason for debating to sell your business. Number three, validation. Yeah, we’re looking for the statue in the park, as I like to say, we want people to see that we did something. And you don’t really get to say that most of the time, unless you’ve sold your business, especially if you’ve taken the venture track in particular, or you’re looking to, for the next pursuit, you’re looking for the next thing to do, you’re tired of this thing you’re looking to do the next thing. So the why is always the big thing to think about, and you want to think about that, why in terms of does that help you as a founder, and then your team members achieve whatever goals it is you have.

On the bright side, I actually thought about this as something to really share, especially given sort of the penchant here at BoS and that is making sure you create optionality for yourself. While I have no personal aversion to the venture exercise, we went the other way with that, partially because we couldn’t raise money. But also, at the end of the day, we’re stubborn bstards, both Charles and myself, and we needed to be in charge of our business to do what we needed to do. So we created a cash generating cash efficient business. And that gave us maximum optionality in the negotiations process, and so forth. In this particular story, when we were negotiating with LSEG, and we were talking about doing the raise, and and they basically said, we can stop you. And my response was, we actually don’t have to raise money, we had roughly $8 million in the bank at that time, and we were throwing off profits pretty wildly. And so we could have still executed on our business plan, it would have been a little slower, but we could have still executed on the plan without ever having to raise another nickel. And so having that profit driven model, allow for us to tell LSEG I’ll go back to that original Elizabeth, thank you thing to fck off. And by doing that, that allowed for us to be able to negotiate a much better deal with them on that side.

Nothing wrong with the right hand side of that equation. But it is something to think about when you raise venture capital, you and you’re running a cash burning business, you lose a lot of that optionality. So you should really be mindful about that as you decide which path you’re going to take as you’re growing your business, which one gives you more choices.

So building with the end game in mind, we actually set this whole thing into motion. years prior, our business was built on channels, enterprise channel players, and part of the sneaky trick for us was we actually brought in partners that we knew would likely want to purchase us. Now, we knew this model would work because it was the same model we had used at Address Doctor. When Informatica purchased Address Doctor, they were already a partner of Address Doctors, they generated. They had OEM the technology generated revenue. And so for part of the story, it doesn’t get told often with the address doctor, exit was at SAS my old company, also was a partner of address doctors and they actually approached us first to acquire the business. And when they made the approach, we had the conversation to say, if you offer this number, we’ll sell it to you. If you don’t offer this number. We’re going to open it up to the rest of our ecosystem. They came back and offered half the number we told them. I was like, alright, stupid. We opened it up, and Informatica said, I’ll take that. So again, in that particular situation, we actually got the deal without bringing other parties in into it. And the same was just, you know, ultimately the same was the case with LSEG. LSEG knew that if they did not buy our business, the odds were, we would have sold it to Experian, we would have sold it to Thomson Reuters, we would have sold it to any one of a number of the other partners that actually competed with them in the ecosystem. And they could not tolerate the notion of that. So you always, if you think about this, you want to set the groundwork early, by lining up those partners working with those partners over time, they know your business as a result of that, they already have an understanding of how your team operates. And they see that it’s not all just the Bill and Charles show, as you might, some people used to refer to it as understand the value of the business.

Or you can sell through an investment banker. Nothing wrong with that. But I would posit, at least from a personal bias perspective, that investment bankers are really good at setting up auctions. So there’s not that ecosystem component, there’s not that internal piece, it’s more of an auction exercise, they can generate the activity with a lot of other parties. But I’ve always found that selling to an existing business partner keeps more money in my pocket. And it just sets things in motion. It’s a much more robust sell, I tend to use the term you create deal fever. And that’s something I’ve used a term I’ve used for years and years and years around the acquisition game as you want to create deal fever. And the way you do that is you get really close to someone and you just start infecting them.

Again, one last little story on LSEG refinitiv psi, the business partner that we work with to basically facilitate the deal. He and I would talk on a regular basis, he was actually on our board as a result of doing the A round. And the one message he kept hearing from the time we did the round at 40 million was that our valuation was going up every quarter; we went from 40 million to 60 million to 100 million. And he knew that that number was only going to keep going higher, the longer he tried to pussyfoot around the exercise of not buying our business. So for him, he had it in his head that we got to buy these guys because that valuation number is only going to go up. If you engage with a total stranger, you don’t have that history layer going on there. And hopefully that makes sense. And we can talk about that a few minutes here.

So key learnings, exit considerations, seek advice and counsel, talk to your colleagues and friends, I talked to a number of people during this process, it was important to me to go out and solicit information. And not only just around the exit itself, but actually what to do after the exit. So I talked to roughly ten exited founders during the process. And so that’s where I learned the fact that everybody takes a trip, some significant percentage go out and work on fitness aspects after the fact. And then there’s you know, the third is everyone gets a toy. And you know, maybe the car, maybe the boat, it may be you know, this is a big enough exit, just private jets, everyone gets to toy that’s common threads, seek the advice and counsel and learn from that.

Prepare yourself and your team, don’t leave your team completely in the cold. Our team always knew we were going to sell the business. There was never any doubt when we hired you. If you if you didn’t know that the odds were that we were going to sell the business, then somewhere along the way you weren’t listening. And so you always want to make sure you prepare your team. While we couldn’t tell the team exactly when we were going to sell the business. They always knew selling the business was absolutely a part of that process.

And retain control of the process. And this is really, really important for you as founders. I could tell you there were multiple points during that six month due diligence and deal process where had we not and I say we meaning my co founder and myself not retain control of the process. If I let my CFO or GC actually do the deal. We’d have probably actually ended up selling for less at a couple points along the way. They don’t have the same mental fortitude risktaking capability as you do as founders, you need to be in charge of that process. This is your baby, this is your deal. Don’t give up control of that particular bit of the process.

Everyone got a piece of the pie

And then finally, in all of that, calculate the people’s needs. Most of the time, most founders think about their own needs, which is important and absolutely, you know, crucial. But think about your investors. Yes, they’re your investors, they put money into you when no one else would. So most certainly think about your investors, whether they be friends, family, or professional investment, but make sure you put the appropriate amount of time and to thinking about the team. I love the fact that Charles and I actually put that time in early on at GDC and we said, everybody’s gonna get a piece. And we actually, at the end of the day only had two people who didn’t get anything. And that was only because they had been with the business for less than 30 days. Couldn’t quite yet do that. Everyone else got a bid. And that was just that important to us.

I’ll tell you one last funny story on that front about how everybody got a bid. We actually had a contract developer early on in the business, you know, when we didn’t know what we were doing. And we had this guy who built some stuff for us. Apparently, we don’t, we didn’t even remember the guy there, you know. But once the deal was actually announced in the local media, I get this email. Hey, what does this mean for my equity? Now, this guy wasn’t even on our cap table. We were like, your equity? What? Yeah. Who is this? And we went through kind of a little, you know, process around. Alright. Is there any fact around this? What do we have? Our GC was like, Oh, my God, you got to pay him off? You got to give them? Yeah, we went through all of this. Energy. Yeah, there was a lot of energy at that point in time, I tell you that.

Ultimately, we told everybody to shut up. Charles and I got on a call with the guy and said, Look, we don’t have a record. But you definitely we know you came in, we know you did some stuff with us years ago. We’re gonna give you this. And we gave him a, you know, a settled amount, we gave him a reasonable amount of money. And he was happy with that. And he took it signed off. And ultimately, he too, got made whole in that process. So make sure you take care of your team, regardless of whether they’re actually members of your team or not. There’s probably the moral there.

Go talk to LSEG. Escrows over, we’re out. We’re done.

The House of Good Deeds

So the most exciting part of all of this for me, what’s next? At the end of the deal, I ended up out to drinks with our sales team. And we were having a wonderful sort of outdoor sitting and drinking beers. And everybody was kind of shouting, huzzah. And we were just really excited. And our Head of Sales turns to me. And he says, Bill, what’s it really feel like to have achieved all that you need to achieve in life to, like, have reached the apex of what you’re going to accomplish and what you’re going to do? And how’s that feel Bill? And, yeah, I looked at him and I guess I looked at him in a very strange way. Because one of our sales guys actually I saw his face shaved, because, you know, I don’t know if he thought somehow my mouth was gonna open it just like swallowed this guy’s head or something. I turned them and I just said, What in your mind makes you actually think I’m done? I’m actually just getting started, bub.

So let’s talk about 2ndF, which actually stands for Second Foundation. And we refer to it as the house of good deeds. So I’m a very mission driven person. I remember things I remember where I came from dance with the people who brung you, so to speak, in the south, we would say. So our mission for the our family offices to drive the inclusive growth of the triangle technology ecosystem, the triangle being in the Research Triangle Park area, to a place a national dominance by 2033. So two points I’d highlight there one is the inclusive piece.

So while I’ve done an amazing thing here with my team with my co founder with others, from a minority participation in our business, there was only one minority who benefited: me. And I’ve got to resolve that in my head. We do not have enough diversity, enough minority participation in the technology ecosystem. And that’s got to change. The national Dominus piece. You got to set a target. And I’m intending to spend money and work with organisations to hit that target by 2033. I think if you don’t have a target, it’s kind of like how do you measure things without KPIs. So for me, this is the mission. It’s not about building another business. It’s about building a community. It’s about building a grander ecosystem. So going back to, you know, my sales guy thinking small potatoes going back to family members thinking, Oh, you’re only ever you’ll be a colonel in the Air Force. Yeah, I’m not, I’m not close to being done yet.

There are three components to second Foundation, one on the investing side, we, personally, will be doing a lot more angel investing now, both in the local community, but also globally. But actually, as you’ll see, we’ve got GDC logo on there. And what does that mean? Well, guess what? You remember, we created quite a few people now with personal net wealth. We termed that the GDC mafia now. So much like the PayPal Mafia, we’ve created our own local investor community. As a result of that we’ve almost, you know, we significantly increased the number of angel investors in the RTP community as a result of our transaction. And we’re working through activation of those people as new angel investors, we actually recently just closed the deal around the funding for local company called, let’s get offline – offline media, where they were raising $2 million. And we helped to contribute about two thirds of that raise through our angel, our net new Angel community network. So that wealth we created, let’s go back to the villains thing, there was always a method to the madness there. And so we’ve now activated a great network of angel investors. And we are also working with other partners such as Pay Pal ventures and others to increase early stage funding in the RTP community by bringing in some larger venture players, and partnering up with them as a function of our global relationships.

So that’s the investing side the money making side of the family office. But the ecosystem support side is actually what makes me really more excited. So the Council for Entrepreneurial Development, some of you have heard of them, we heard about the scholarship opportunity where CED partnered with BoS, we set that into motion, some some weeks or months ago. First taste of that was providing the 10 attendees to BoS this year. And we hope to do more of that as we go. We’re also working with North Carolina State University and their entrepreneurship programmes to actually work with their Chancellor’s Innovation Fund to actually make sure investment is going into what I call real tech, deep tech type organisations that don’t necessarily always see the light of day from a funding perspective.

And then triangle Family Services, which is one of the largest and best run mental health services organisations in the Research Triangle area. They do a lot with supervised visitation, mediation around homelessness, and other key things, they actually opened and ran a 200 room hotel during the COVID crisis for homeless people. And as a fascinating organisation, we’ve made a pretty sizable contribution to their organisation, but we’re actually working with them to do some other things along the way for the ecosystem. And again, this part is important. It’s got to be inclusive. It’s one thing to do angel investing in helping some more people make more money. But it’s another thing to create a flywheel that actually helps to actually drive growth and inclusive growth throughout the community so that everybody benefits in some way. That’s important. We live in a community. And if you break the social compact and go it alone, you’ll die out there on the trail by yourself and that’s something to remember, always go back and remember.

Then, finally, on the minority education side, we’re supporting two large schools that focus on minority education; the Durham nativity school and the Daniel centre. We’ve also launched this strategic programme with this group called The Black Dollar stores in Raleigh, which brings together small minority entrepreneurs who make things like candles, clothing and other gear they have a retail outlet store and they allow they basically lease shelf space, we actually have supported strategically the hiring of a CFO, a marketing head and COO for that organisation, we’re paying their salaries for one year. And so the idea there is to give them a chance to actually scale that business and dream around how to grow bigger. And we’re going to be looking for other ways to provide opportunities for underserved minorities, because at the end of the day, if I can create 100 more of me, without actually doing some type of a genetic exercise here, that has got to be a good thing for the world, I really want to help more people dream and think about what they can accomplish in life. By maybe looking at one of the good guys instead of having to fixate on say, the Master or Victor Von Doom.

How do you actually grow? How do you dream? How do you think about things bigger, regardless of whether you are coming from a you know, tough socio economic, environment, or otherwise? So that’s the second Foundation, the house of good deeds, that’s what we’re going to be doing next. And I challenge each of you to think about this. As you move toward exit, as you will eventually do at some point in time, think about how do you make sure you do right by your friends and family who supported you, when no one else would? Make sure you take care of that internal team? Again, regardless of whether you remember them or not, you should always take care of the team. And think about your ecosystem. Many times we tend to rewrite history when we are successful, we say we did it all. It was us it was always us. But guess what had that ecosystem not supported you along the way you might not have made it. In fact, most likely you would not have made it. So remember, whether it’s BoS whether whatever your local ecosystem looks like, support that ecosystem, give back to that ecosystem so that the next set of entrepreneur founders can actually continue on and do the same thing. And I’ll close out, you know, consider that the Kauffman Foundation, there’s a great plaque on their campus in Kansas City outside the campus. And they’ve got on that plaque, the phrase

“I will give back to the society that helped me build, I will build a stronger America. I have served. I shall continue to serve.”

Think about that. Do that. And I’ll open it up for questions. Thank you

Carl Ryder
So on the slide with the two raises. Why didn’t you ask me? What are the two slides where you raised money over? Yeah. What did you ask me, Bill? From the same, town!

Bill Spruill
Carl I don’t think I don’t think I knew you. Exactly. Exactly. Any other questions.

Carl Ryder
Hi, thanks so much for a really inspiring talk. Just a really quick question about, clearly, after 10 years of hard slog and putting a lot of groundwork in place something really spectacular happened in the last couple of years. Can you just talk a little bit about what happened with that series A funding and how what that managed to unlock for the company, because, you know, it had to be a combination. It wasn’t you weren’t sitting around doing nothing for 10 years, but something really turned the corner there. Can you just tell us give us a bit of an insight about what was happening at the company in that stage?

Bill Spruill
Sure. So again, going back to the particular to series A story. So Experian was the original sort of investor, and as a partner of ours, so they were a partner, they actually weren’t generating a lot of revenue for us. But they had a country manager who saw the potential of our product offering they had an existing product that they could not actually upgrade that did what we did, they were actually one of our competitors, frankly, on the matrix. And so they their thought was to invest, get favourable terms and then ultimately they were going to hopefully buy us on the cheap. That’s kind of what their modality was. And so, yeah, that sort of kicked off the A for us and that was why they wanted to do it. So it was a strategic at that point. They wanted to do the investment. And then again, so that was December/January timeframe. They retraded on on us. And that’s when Refinitiv stepped in. And just to give everyone sort of background: refinitiv is a company very large fin-tech company, they were acquired by LSEG actually, also in 2020. So refinitiv is LSEG at the end of the day. And so refinitiv stepped in at that time and said, hey, we’ll do the deal. We’ll we’ll come in. And that was because that partner, that business unit partner at refinitiv, I had been feeding him information all along, they were already a partner of ours, and I let them know. And he was like, Hey, how about letting us and we’re like, nope, we’ve already signed an exclusivity, we got to do this A with these people, experienced hat and Retrade. I can’t say that we would be here today with the same possible outcome. So I’m thrilled to death that the CFO at Experian basically felt the need to actually try to change the terms on the deal. And so that we could tell him to take a hike. And we ended up with refinitiv as our Series A investor.

And then once they became our series, A investor, the weird thing that actually happened was we met the Robertson family. And literally, it was about three weeks after we had closed the round. I took a walking meeting with a guy because again, this was the height of COVID. He actually was in the Raleigh area. So we took a walk at the local museum. And after I finished talking to him for about 90 minutes, he was like, Look, I want to invest, I want to put a million dollars in will you reopen the round? We said no, we can’t do that. But we’ll keep you sort of warm and fuzzy around our series B. And so that’s what led to them being willing to write a $12 million, check for the series B and put a term sheet out there. Which then cause LSEG to say, yeah, hey, we’re not going to let these other guys get get into the deal. We’ll take the deal and that then force the buy. So I get that that might be a little bit choppy. But maybe I answered the question a little bit for you there.

Carl Ryder
Yeah, it’s just interesting, because you know, it’s like it typically like that, that funding would come in, and it would be okay. Well, now this is the water, we worked it all out. And this is the just add water. It allows us to do X we were going to suddenly we could advertise but it’s by profile. But are you saying it was more a case of it sort of it was like a momentum thing. It was like a snowball effect?

Bill Spruill
It was it was very much a snowball effect in a year, we have to remember, we didn’t need the money. In fact, our CFO was foaming at the mouth. He’s like, why are we taking this money? We don’t need we’re cashflow positive, we’ve got money in the bank, what do we want this for, and we had bigger aspirations, we were going to buy some of our data partners, we could’ve use the money. That was not a problem. We definitely could have used it but we didn’t need the money. And so what we knew was we wanted to create that sense of urgency that deal fever, again, if you will out there. And we want to start to create that friction between some of the partners and players. So that ultimately, we would end up in that position. And it frankly, it played almost perfect to the playbook.

Audience Member
Thank you. So thank you very much, my question is regarding the unit economics, let’s say behind the product, and how was the process of you know, all this is because of the product has a price and a total acquisition market that was enough for you to be in a good position to negotiate? How was the process of setting that up? Would you? Let’s say rather a thing, I am just going to do this multiply by x. And this is this huge amount of money that I can then negotiate on, or was it something fancier?

Bill Spruill
So the answer to your question, and I never do deals based on the unit economics, because then you’re doing a financial deal and not a deal fever deal. And I will go back to this slide to try to answer that question. So our revenue at the time we were negotiating, The acquisition was rough. We close out last year at 20 million in revenue. And so, you know, I was negotiating that series B on the notion of it being $150 million valuation company, which, you know, at that point in time, roughly, you know, yeah, that type of revenue multiple wasn’t outrageous, because of the way the markets were running. The 150 to 300 was purely because they knew the deal could be more expensive, but they didn’t take us off the table then. So, in fact, this goes back to the story I started with at the very beginning. Part of me was wondering if I could have gotten the 400 or 450 and was 300 too little, and that was where my friend very smartly told me Bill It is enough. So how much is enough? It was enough so that we didn’t do a unit economics thing. The diligence was really cursory around the business to make sure that we actually had real contracts with customers, and all of those things. But this was not based on any mathematical model metrics or anything. It was how much will you know, how much do we have to pay you to get you off the play board? And in 300 million was the correct answer for that.

Audience Member
And if I can ask another question would be, how did you negotiate to not be actively involved for three or four years? How did you the risk that for the acquiring partner?

Bill Spruill
Well, the risk in their minds was me staying for three or four more years? Remember, I tell I, like I said, I acted like a jerk. And again, anyone who knows me, there’s lots of stories where if Bill has a fit, you don’t really want to be on the receiving end of a fit. And they knew that I was not the type of person to fit into their organisation. I’m not a large corporate guy up just it will not go well. So they were like, Here’s your money. And yeah, just yeah, how quickly do we get you out of here?

Bill Spruill

Co-Founder & President Global Data Consortium

Bill was co-founder and CEO of Global Data Consortium (GDC) before its acquisition by London Stock Exchange Group in May 2022.

He started his career working with SAS Institute before working in a variety of companies focused on international address verification, matching and data quality that had a habit of being acquired successfully including AddressDoctor, Loqate, Identity Systems and Intelligent Search Technology.

Bill is an active angel investor. Past exits include Union Metrics (sold to Trendkite/Cision); Magnus Health (private equity acquisition) and Loqate (acquired by GB Group UK). As part of his volunteer work with the Council for Entrepreneurial Development (CED) Bill has mentored over 80 companies through early, mid-stage growth and exit challenges.

He attended Northrop University in Los Angeles, California and The University of North Carolina at Chapel Hill.

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