TrustRadius CEO & Co-Founder: Vinay Bhagat

Summary

Today’s guest is Vinay Bhagat, Founder & CEO of Trust Radius.  You’ll want to be sure to listen to this episode to hear how Vinay’s experience with racism growing up shaped him to be more empathetic, how Vinay addressed racial bias issues in the workplace, and ultimately, how being fired from a job was the best thing that ever happened to him.

Vinay was born & raised in London and was the child of immigrants.  His mother was a teacher and his father was a car designer, and his parents loved to travel and camp at lots of different places.  Back when Vinay was growing up in London, there was still a great deal of racism, and he remembers being verbally abused and physically bullied very often in school.  He attended the University of Cambridge, and wanted to work for a big consulting firm after college.  Due to the ongoing racism during the time, Vinay couldn’t even land a first-round interview even though he was near the top of his class.  Since he did so well in school, he was able to get into Standford to pursue a master’s degree in engineering economic systems.  During his time at Stanford, he was approached by the same consulting firms to interview with them, the same ones that he couldn’t get a first-round interview with after graduating in London.  Vinay would not take this lightly – after he was hired on at Bain & Company, he worked hard to demonstrate how there was a racial bias in their recruiting process.

After  Vinay got his MBA from the Harvard School of Business, he ended up at a computer software company in Austin, TX, as their director of e-commerce.  Before finishing his first year, Vinay openly disagreed with the CEO, and was fired because of it.  That would be the turning point for Vinay.  He says that was the best thing that could’ve happened to him, because he was now able to finally satisfy the entrepreneurial bug that had always been itching inside of him.  The first company he started was an online fundraising solution for nonprofits, making it easier for nonprofits to raise money.

Podcast Transcript

Note:  There may be errors to this transcript (some funny, some confusing - we used an automated transcription software!)

00:00:02 Ash Faraj: Hey, it’s Ash. Today’s guest is Vinay Bhagat, founder and CEO of TrustRadius. You want to be sure to stick around to the end to hear how Vinay’s experience with racism growing up shaped him to be more empathetic, how Vinay addressed racial bias issues in the workplace, and ultimately how being fired from a job was the best thing that ever happened to him.

00:00:25 Ash Faraj: Welcome to Season 3 of ExecuTalks. It’s the podcast that connects you with today’s top executives. You will hear interesting childhood stories. Stories of extreme setbacks and disappointments and ultimately hear the story behind how these top executives were able to build an amazing career for themselves.

00:00:41 Ash Faraj: So really quick, before we get into the show, we’ve started to invite our audience members on the show to connect with our guests and ask questions towards the end of our conversation. If you’d like to be on our show, you need to make sure you’re subscribed to our newsletter on our website and look out for emails that invite you to be on the show. And as always, you can reach out to me directly if you have any questions or you just need someone to talk to, Ash@ExecuTalks.com.

00:01:06 Ash Faraj: Vinay was born and raised in London and was a child of immigrants. His mother was a teacher and his father was a car designer. His parents loved to travel and camp at lots of different places.

00:01:17 Vinay Bhagat: My dad was really… he wasn’t a planner. It was kind of by the seat of his pants. We were going around Europe. We were camping. We had our car. We’d just drive to different locations and camp. Somehow, we ended up in Switzerland. Then he decided that we were going to go up to Jungfrau, which is a mountain and a glacier up in Switzerland. We were totally unprepared. We didn’t have any warm clothes. We got to the top of the mountain and we’re all like freezing and shivering, but it was still kind of cool. Just be that, again, those seat of the pants in terms of our travel schedule that we got up to see this amazing place, even though we weren’t really prepared to go have a vacation in a winter spot temporarily because it was summertime. Just because of the altitude and the glacier, it was super cold. It was just one of those memories that was kind of left in my mark; a, because I was probably really cold at the time, but b, because it’s so breathtaking and amazing. My father passed away last year. I just admired his spirit of going with the flow and just not being overly prepared; for just exploring. I thought that was just really fun. I’m quite different. I tend to be a lot more planned whenever I take my family on vacation. I know exactly where we’re going to stay and oftentimes where we are going to eat in advance, but I admire his spirit. I guess what I would say I learned from my father is the importance of hard work and drive. He wasn’t super successful in his career. He worked at Ford Motor Company as a car designer. But what he did to provide for his family was at a bigger level as he had a side business. He used to go to London every Sunday and then buy products like jeans and briefcases and digital watches and sell them at Ford Motor Company and built this network of people who’d go buy products from him and then sell them around Ford and Europe. He built this really large, by his standard, business that paid him multiples of what his salary gave him. He just did it on the side. It was funny. I used to go with him to London on Sundays to help him and just go along for the ride and accompany him. What I saw in him was a man trying to change his life situation. He wasn’t just going to settle for his lot in life. He was going to prove himself and was driven and determined.

00:03:54 Ash Faraj: Back when Vinay was growing up in London, there was a great deal of racism. He remembers being verbally abused and physically bullied very often in school.

00:04:04 Vinay Bhagat: Yeah, you know, so I grew up, umm, child of immigrants in the UK. Dad from India. Mom from East Africa. They were middle class. My mom was a teacher. My dad was a car designer. We weren’t wanting for money, but we weren’t wealthy. Had a strong focus on education being both Asian parents, but also my mom being a teacher in particular put a lot of emphasis on that. Britain back in those days was not a very friendly place to immigrants, particularly to people of Asian descent. There was a pretty large Asian community in the UK. The town I lived in there were very few Asian families. I think there were two others, and we knew them very well. Obviously, there were denser populations in other parts of the country, but there was a great deal of racism even though I went to a good school. I would get verbally abused and even physically bullied by other kids in my school because of my race, and I think it scarred me. It made me feel like maybe I wasn’t welcome there and I needed to get out, but also hardened me and toughened me up a bit as well where I think it’s made me who I am today.

00:05:18 Ash Faraj: Vinay attended the University of Cambridge and wanted to work for a big consulting firm after college. Now, due to the ongoing racism during this time, Vinay couldn’t even land a first-round interview even though he was near the top of his class. Since he did so well in school, he was able to get into Stanford to pursue a master’s degree in Engineering Economic Systems. During his time at Stanford, he was approached by the same consulting firms to interview with them; the same ones that he couldn’t get a first-round interview with after graduating in London. Vinay would not take this lightly. After he was hired on at Bain & Company, he worked hard to demonstrate how there was actually a racial bias in their recruiting process.

00:06:00 Vinay Bhagat: I went to Cambridge. When I was graduating, there were certain firms that I wanted to go work for in London. I couldn’t even get a first-round interview with them. It wasn’t because of my academic history. I was like near the top of my class. There was just something that was blocking my ability to actually even get an interview, let alone a job. I ended up coming to America to go to grad school at Stanford. Then the very same year, got approached by the same firms; the big consulting firms like McKinsey and Bain and BCG to interview with them. That same second year, interviewed back with Bain in London and got rejected again. I ended up joining Bain in San Francisco, transferring to London, and said, “Look guys, you have a bias issue in your recruiting process.” They’re like, “No, we haven’t.” I looked around the office. There were 115 people. I was the only person of color, except for the guy who managed the telecom system. None of the consultants were of color. Very few women. I was like, “You have a problem here. You may not want to admit it, but you absolutely do. There’s no way.” They said that I must have been a clerical error. I was like, “Two years in a row you made a clerical error? I don’t believe you.” So I asked and they said, “What do you want to do?” I said, “Give me your last five years of recruiting data.” I went through it and proved to them statistically that they had bias in their recruiting. It wasn’t intentional discrimination. It was pattern matching where they were trying to recruit people like themselves. So one of the things I’ve learned is that there is natural unconscious bias that exists in many environments and people feel comfortable with people like themselves. In their case they were recruiting people who’d gone to elite private schools. I didn’t go to a private school. They’re recruiting from people who pay played certain sports like rugby and who had rowed. I hadn’t done any of those things. I had a different background. I came from a different economic environment. So thankfully they changed. But that experience growing up in England inspired me to want to leave and do other things in my life to try and remove those constraints. So I ended up living in Hong Kong for a few years and loved it there. Found that the British people living in Hong Kong were really welcoming and didn’t see people based upon the color of their skin. They saw them based upon their ability. You know I had really phenomenal relationships with people from Australia, China, America living in Hong Kong and really loved it there and then came to the US. Some of the things I went through with racism has also made me very empathetic for the plight of others who are less fortunate. In the US, there’s still a massive systemic racism problem, but for the most part Indians are fine, right? We don’t experience massive barriers in the US, whereas if you’re black or Latin then you do. Again, I think, having gone through that myself, I have more empathy than had I not gone through that just because I know how hard it is and how horrible it is when you go through that. Those experiences have made me who I am and what I care about.

00:09:16 Ash Faraj: After a couple of years, you decided to go back to the Harvard School of Business to get your MBA. Is that right?

00:09:24 Vinay Bhagat: I had a really good tenure at Bain and was loving it. I had a good trajectory ahead of me, but it was actually the managing partner of Bain in Hong Kong who told me, “You really need to think about expanding your experience and going to business school will open up a new world for you and your oyster to explore new opportunities.” He was the one that kind of encouraged me to go. You know, I’ll say it was a transformative experience. I met some wonderful people. I was opened up to so many new opportunities. We had a lot of amazing speakers who came and spoke at the school. Everyone from like Warren Buffett through leaders of captains of industry. For the summer, I got to go work on Wall Street and see what it was like in the world of investment banking and realized I didn’t like it and also got exposed to the world of private equity which was pretty cool. Certainly, it was two years to really kind of evaluate and think about what I wanted to do in life. Exposure to an amazing network of people. Just the chance to kind of grow and then find my footing thereafter.

00:10:34 Ash Faraj: After Vinay got his MBA from the Harvard School of Business, he ended up at a computer software company in Austin, Texas, as their Director of E-Commerce. Before finishing his first year, Vinay openly disagreed with the CEO and was fired because of it. That would be the turning point for Vinay. He says that was the best thing that could have happened to him because he was now able to finally satisfy that entrepreneurial bug that had always been itching inside of him. The first company he started was an online fundraising solution for non-profits making it easier for non-profits to raise money.

00:11:07 Vinay Bhagat: It was a very personal choice. I think you ultimately have to understand what you want to do and accomplish in life. To me, I’d always had this entrepreneurial bug and I knew I wanted to be my own boss and kind of create my entrepreneurial venture. That was my driving force. Now, if you don’t have that inside you, I don’t recommend it because entrepreneurship is not an easy path. It’s a path of a lot of effort and toil and ups and downs. When it’s great and you succeed, it can be amazing. But there are sizeable barriers also to your success as well. So you only do it if you’re really committed to that part. In terms of going back to graduate school, it’s a really good opportunity if you’re trying to change industries or change roles. In my case, I was a consultant. I could have stayed a consultant and I didn’t need to go to school for that, but because I wanted to go potentially and do something very different it was a great transitionary mechanism for that. It’s often really hard to swap industries or roles entirely without a move like that. Now, if you get into a high-growing, large company and you’re doing well, then there’s often a willingness to let you kind of move between roles as well. One of the most important things early in your career though is to go learn from good people and to focus really on learning. Now, I started my first company at 28 for a couple of reasons. One, again, I always wanted to be an entrepreneur, and two, frankly graduating from business school I came to a company here in Austin and I was a misfit. I wasn’t a really good cultural fit for the company. I was pretty miserable from the time I joined. About six to nine months in, I kind of got myself fired because I just disagreed with the CEO. Frankly, that was the best thing that ever happened to me because it was the catalyst to actually go start my first company. But, you know, in hindsight, probably what I should have done is go to an environment where I could learn for a few years from executives that I could really mirror and learn from. I’ve had to do a lot of kind of on-the-job learning. If anything, I would have probably… If I was advising my younger self I would say, “Make sure you go work for the right people that you can learn from. That’s the most important thing in life.”

00:13:46 Ash Faraj: Thirteen years after starting his first company, it was acquired, and Vinay received a large payout. Not long after, he decided to start another company, called TrustRadius. The idea of this business is kind of like a Yelp, but for businesses who use technology. So if you were unsure about using a software as a service product, you could use TrustRadius to help you make a better decision based on people’s extensive reviews who have used it in the past.

00:14:12 Ash Faraj: So your first start-up was acquired, and I assume you received a large payout. Why did you decide to start a company again? What was it that moved you to do it again?

00:14:23 Vinay Bhagat: Well, one of the things -- that’s your context question around whether it’s the right time to start a business -- is you don’t want to start a business when you’ve got too much responsibility. I was only 28. I had a really inexpensive apartment. My wife was working. Not making a ton of money, but it was enough to survive on. I didn’t have a lot of debt.  And, again, I didn’t have a lot of responsibility. We didn’t have children. We didn’t have a high-end mortgage or anything, so I felt I could take a risk. It was also a very interesting time in 1999 where there was just so much opportunity. It just felt like the right time to kind of take a leap. Now, it took effort to go figure out exactly what I wanted to go do. What was the business I wanted to pursue? I had multiple different entrepreneurial ideas, like that’s it. But it really starts by determining that is what you want to do and then being very deterministic about how you approach it and being open to seeing opportunity around you. When you’re in an entrepreneurial zone, you’ll see problems around you that you didn’t see before just because you’ve opened your mind to the possibilities.

00:15:46 Ash Faraj: What were some of the painful learning lessons that you remember learning early on?

00:15:51 Vinay Bhagat: I was fortunate enough to raise venture capital pretty quickly, 4.6 million dollars. It was a unique point in time in our history. It’s not nowhere near as easy to raise money today, but with that capital it gave us opportunity. But it also made us, I think, a bit too rosy and optimistic about the future as opposed to really kind of biding our time and being methodical in approaching the problem. I think we spent too much capital in our first couple of years; just trying to scale too fast as opposed to making sure that we really had what people today call product market fit. When I knew I was solving an important problem, but the question is how ready is the market to putting an effective solution to that problem and how square a fit is your product for that market need? And, frankly, it took us a few years to find that product market fit and also quite a few years for our market to mature to be ready for what we were trying to do. In simple terms, my last company was an online fundraising solution for the non-profit sector and in 1999 almost no fundraising was done online. Of course, I saw everything that was happening in the e-commerce world and said this is crazy. This is a massive industry. Fundraising will move online and I’m going to be a platform for that. And I was right. I was absolutely right. Now it’s a massive industry and we were the leading company in that space, but the reality is that markets take time to change. People take time to change and you can’t expect things to be an overnight phenomenon. Also, it takes a while to write up the right solution for the problem in the marketplace as well. So the mistake I made was trying to grow too fast early on before the market was fully ready and before I had concreteness around the product that we had to go build. I had a viewpoint on the product, but we didn’t nail it. Initially, it took a few years to kind of really nail the specification of the product that was going to win in the marketplace. The other key consideration is just hiring. I made a lot of hiring mistakes early on and had to churn through a lot of people. Who you surround yourself with, who you partner with is critically important. There’s a saying, “Who do you want on your bus with you?” Those mistakes I’ve absolutely not made this time around. I’ve been a lot more methodical in growing our business and a lot more focused on the people that I want on the bus with me as well.

00:18:32 Ash Faraj: And why did you start another business all over again even though -- I assume you obviously received a large payout, and you didn’t have to start another business. Why did you do that again?

00:18:42 Vinay Bhagat: To do it better. I mean, I was young. I was still in my early forties and felt I had more energy and more ideas within me. I love entrepreneurship. I love building companies. I love solving hard problems. I love scaling teams. Also, I wanted to build a very different kind of business. The simplest thing would have been to go and do something similar to Convio, maybe another vertical software company. Maybe even something in the non-profit sector because I was very well-known in that sector and was respected, but I didn’t have a brilliant idea in that sector. Part of me wanted to do something radically different that would be a different problem intellectually. And, you know, starting TrustRadius, we’re a two-sided marketplace where we help professionals who are evaluating technology understand the whole [indiscernible] before they buy by reading peer reviews, in-depth reviews written by people that actually used the technology. I thought that this business, if I could make it work, would have much more interesting economics because it could scale a lot more quickly and cost efficiently than a traditional software company. So I was very inspired to create a business that I knew was needed, because I’d experienced pain myself buying technology or seeing my team buy technology at my last company. I also believed that I could create a business model that would have a very different profile to my last company if we could make it work. So that’s what inspired me. Again, I love entrepreneurship and I just wanted to do it again. It’s fun. I don’t do it for money. I don’t do it for other purposes. I just really genuinely and love the creative process of building a company.

00:20:38 Ash Faraj: Do you think money is what motivates successful entrepreneurs?

00:20:45 Vinay Bhagat: You can’t be an entrepreneur if you’re just motivated by money. There are, frankly, the risks; the odds of success are small. There are much easier ways to make money than entrepreneurship. Yes, you can make money as an entrepreneur. Of course you can, but you can’t do it for that reason. You can’t be motivated for that reason. You have to genuinely love the process. You’ve got to genuinely love the journey that you’re on because maybe the outcome happens 12, 13 years later financially. But you’ve got to put a lot of hard work in and if you hate it along the way or if you’re not prepared to do the hard work or you’re not prepared to make the difficult decisions you have to make, you’re going to hate yourself the entire time. You have to love the process. You have to love the journey.

00:21:31 Ash Faraj: What do you feel like has… some of the keys are that have made you successful? I guess more specifically, what has made TrustRadius successful?

00:21:41 Vinay Bhagat: You remember my favorite book Boys in the Boat where if you work hard and you’re scrappy and you collaborate well, you can win despite the odds against better funded teams. I had that situation in my marketplace where there were certainly competitors who were better funded than us, but I feel like we’re really executing very well as a team. My team is very collaborative and got the right attitude and right work ethic. That’s a really important cultural thing that can help a company really succeed. It’s really hard to replicate. It’s really hard to compete against. The other thing is I think we’re building something of true value to people in the world. As you can tell from my entrepreneurial experience, it’s not just about making money. It’s about trying to drive change. That’s why I started like an online fundraising platform because I saw it could help the non-profit sector. I started TrustRadius because I felt that we could help people make better decisions. My last company had made a number of technology purchases where we regretted those decisions and some of them were pretty costly mistakes. If we can just sort of make a world where buyers just can make decisions without regrets, I think that’s just a very powerful idea. So we’ve built a really trusted platform at this point. Over a million people use our platform every month and it’s growing really quickly. We grew 2.4 times in the last year, and I just think we have the opportunity to become the trusted brand in our marketplace. The place that if you are going to buy technology, you always use TrustRadius as part of your journey, as part of your evaluation. I think we have an extremely viable opportunity to become that platform.

00:23:43 Ash Faraj: What are some things that you realized when building TrustRadius that could really help others in building their own companies?

00:23:52 Vinay Bhagat: Realizing you can’t solve all those problems at once. You have to approach it in almost like a linear fashion initially. I realized the first problem that I needed to solve was convincing total strangers to write high-quality reviews, and I knew instinctually that quality meant a great deal. This wasn’t Yelp. The consequence of having a bad slice of pizza is maybe an upset stomach, but it’s not a loss of a job. Whereas when people make a bad technology decision for the company it can be a career limiting move. It can be a positive thing if they’ve made the right choice. It can make a transformative change to a company. So I knew the stakes were much higher in my industry. So we focused on, again, solving one very simple problem. How do I get people to write something of quality? The second problem is how do I do that at scale? Where I’m not just adding a hundred reviews, I’m adding thousands of reviews and I’m covering thousands of products. The next problem that I have to solve was how do I turn that content into an audience because I knew that an audience was going to be my current group of values. If I could get an audience and I could get them to stick around and come back, there was a lot of value in that. I didn’t know up front exactly how I was going to monetize, but I knew if I could create an audience there’d be a monetization opportunity. So literally we’ve spent our first few years doing nothing about those things. I was backed by venture capital, so were afforded the luxury of not having to worry about monetization then at once, but I knew that I could build an audience first. Then a few years ago, we launched into, “Well how do we monetize this?” while continuing to try and scale content and audience and the features on our platform. But the big focus of the last few years has been around monetization. How do you sell it in a way that’s authentic and doesn’t break the rules of trust and is economically interesting and delivers value to the marketplace. It’s not been easy to figure out the right monetization model, but I think we’ve arrived at it mostly now. The bottom line is that you have to tackle each problem uniquely and often sequentially. When you get to a certain scale, you can attack multiple problems at once. But when you’re starting out, you don’t want to boil the ocean. You want to get really good at one thing first.

00:26:17 Ash Faraj: Hey guys. Thank you for sticking around and listening to Vinay’s story. We’re now at the last segment of our show called “Connection Session Questions” where we ask questions that allow you to get to know our guests on a much deeper level.

00:26:31 Ash Faraj: So if you were to meet the 25-year-old Vinay, what advice would you give to him?

00:26:38 Vinay Bhagat: Don’t be afraid. I think I was risk-averse early in my career around the entrepreneurial part. Number two: find a really great mentor that you can learn from.

00:26:51 Ash Faraj: What in your life do you feel like has given you the greatest sense of fulfillment?

00:26:56 Vinay Bhagat: My children.

00:27:00 Ash Faraj: If you could be remembered for just one thing, what would you want that to be?

00:27:04 Vinay Bhagat: I made the world a better place.

00:27:08 Ash Faraj: In your opinion, what is the most important life skill?

00:27:11 Vinay Bhagat: Humility. No matter how smart and talented or successful you are, you’ve got to be humble in life, and you’ve got to have… with humility comes a growth mindset. Recognizing that you absolutely don’t know everything and that you can always learn. Be a continuous learner. Be a continuous student.

00:27:32 Ash Faraj: What is the best advice that someone has ever given you?

00:27:35 Vinay Bhagat: So when I was starting my second company, a good friend of mine is this successful venture capitalist who ended up backing TrustRadius. But before I went to him with this idea, I had a bunch of consumer ideas. He said, “Look Vinay, these are all fine ideas but you’re ‘B2B’ guy, a business-to-business guy. Stick to what you know. Stick to where you’re strong. There are kids in their twenties coming out of Facebook and Google who know just a lot more than you do about business-to-consumer businesses. You’re going to get killed if you go in that direction.” That was pretty sound business advice because what I did instead was find a business model that was just different enough to what I was doing already. To be interesting and intellectually challenging and have consumer-like aspects to it, but with that core business-to-business which is where my strength is in terms of building kind of business-to-business relationships. And so that was really good advice.

00:28:34 Ash Faraj: And the last one is, if you were stranded on an island and had access to one meal, what would that meal be for you?

00:28:41 Vinay Bhagat: [laughs] A meal that I want as my last meal, my last supper? You know, probably comfort food. My favorite breakfast in the world is an Indian dish, paratha with eggs. But with a fried egg and some pickle and stuffed paratha with potatoes inside. That’s just a comfort food for me whenever I visit my mom in the UK. I usually arrive in the mornings and she would make that for me. Not the healthiest of foods but it’s comfort food for sure.

00:29:19 Ash Faraj: Thank you so much for listening. Now, if you enjoyed this episode, please leave us a rating and review on Apple podcasts. It only takes a few seconds, but it’s worth so much to us. We are helping new professionals in a very unique way, and we need people to hear about it.