Welcome to another episode of Founder Focus with Steve Greenfield, founder of Automotive Ventures. This ASBN original series dives into the inside stories behind some of the most impressive entrepreneurial journeys. In this segment, Greenfield sits down with Mike Lane and President Eric Mayhew, Co-founders of Fluency, Inc., a digital advertising automation platform for automotive professionals.
Transcription:
Steve Greenfield:
This week, I’m excited to welcome our guests, Mike Lane and Eric Mayhew, who were both with Dealer.com prior to the acquisition with Dealertrack.
Steve Greenfield:
Mike has worked in the tech industry his entire career and loves being an entrepreneur and the challenge of a startup. In 1998, he and four others started Dealer.com. Mike served as a COO for 16 years, where he and the team grew the company to over 7,000 clients, 1,000 employees and revenues over $230 million. They successfully sold the company to Dealertrack for $1.1 billion in 2014. To date, this is one of the biggest success stories in automotive technology.
Steve Greenfield:
Eric is president of Fluency, a business-to-business digital advertising platform provider serving industry-focused digital marketing companies. Eric is a nationally recognized expert in the field of digital advertising and has experienced developing platforms and leading engineering teams to deliver solutions that have changed the way global enterprises and brands operationalize advertising. In 2017, Eric co-founded Fluency based in Burlington, Vermont. Prior to that, he was with automotive digital marketing leader and disruptor Dealer.com, which is now part of Cox Automotive from 2007 to 2017.
Steve Greenfield:
Today, we’re going to peel back the layers a bit to understand what motivates both Mike and Eric, how they think about innovation and how they first built Dealer.com and now Fluency. So with that, let’s dive right in and welcome Mike and Eric to the show. Guys, welcome to the show.
Eric Mayhew:
Thank you. Thank you for having us.
Mike Lane:
Hi. It’s great to be here.
Steve Greenfield:
So, welcome. Let’s dive right into the question. Mike, we’ll start with you. The Dealer.com story is really amazing and legendary in the automotive technology space and I’m sure it could take us hours to work through, but take us back to the early days. Let us know how the company evolved from concept to bonafide business.
Mike Lane:
Yeah. That was way back in 1998, which was the early days when dealerships were really thinking about just getting online at that point in time. And then it was really about the website. In the early days, I worked in Boston and I was coming home and looking for a new car, and naturally went online and found a dealership in Williston, Vermont [crosstalk 00:02:56]-
Steve Greenfield:
What year would this have been? What year?
Mike Lane:
This is 1998.
Steve Greenfield:
Wow. Okay.
Mike Lane:
Yeah.
Steve Greenfield:
So early days of the internet?
Mike Lane:
Very early days. Just looking for a car online back then was a very different experience than it was today, right? So naturally, I found a website that popped up organically in the search when I was looking for, I think at that time, a used Jetta, just out of college with loans. So it wasn’t anything spectacular. I went to this website, and this website of used car dealer had four images of every car, like large images, and that wasn’t seen back in the day. Someone was actually merchandising inventory online at that point in time. Naturally, I had to go into that dealership, test drive that car. And that’s when I met Mark Bonfigli, who owned that dealership. He had a vision of how do you merchandise cars online better, how do you solve this problem. We kept talking. Later that year, I ended up with some other friends that worked in technology space. We got Dealer.com off the ground and running. And that was back in 1998.
Steve Greenfield:
So tell us about the name and the URL. How’d you guys get that URL?
Mike Lane:
Well, we actually started as Earthcars.com, because Dealer.com, we didn’t acquire until 2001 when that became available. We were able to snag that and rebrand the company in 2001, but we started as Earthcars.com because that was the name of the dealership. We kind of just stole it at the time and became Earthcars.com web systems at the time.
Steve Greenfield:
Cool.
Mike Lane:
And then in 2001, we grew that business very slowly, right? We had to go out and convince dealers to even get online at that point in time. There was some draw to it, but we were also convincing people to buy a computer and get their website up in one single day.
Steve Greenfield:
Sure.
Mike Lane:
So very different experience of what it was today. We started growing the business and really building up the technology and doing the one thing that the other competitors in the space weren’t doing, which is really focusing on merchandising the vehicles and how do you do that really well, because that is the beginning. No one talked about consumer journey or customer experience or user interaction. None of those terms existed back then, but that was the core of what it was. How do you go online and merchandise a car and see a car? What is the best user experience to draw that person into the dealership? And that’s really what we focused on.
Steve Greenfield:
Cool. Cool. So Eric, over to you, so how did you come across these Dealer.com guys? Let us know about that story.
Eric Mayhew:
The back story goes even before Dealer.com. I knew four of the five founders from college days, believe it or not. So Mike and I were very close friends back then, obviously not close enough to be there on in 1998, but pretty close to general, but I knew four of the five founders. I moved back to Vermont to actually be able to socialize with those guys, right? I was up here and I was working for an aerospace company. I was working on helicopters and I had done that for about 10 years. Dealer.com’s meteoric rise was there. It had taken off. I’m a mechanical engineer by education, and I was working on a very big data system. So I ended up in software, but for mechanical purposes on helicopters.
Eric Mayhew:
So, that data experience, that large data experience lend itself well to when Dealer.com was ready to get into digital advertising. They said, “This is a big data problem.” So they called. Mike was one of those calls and sold the idea. I had already seen the growth and the smile on his face over those years and said, “It’s time to make that transition.” And I went over to join Dealer.com to start their advertising platform there.
Steve Greenfield:
That’s great. So tell us a little bit about how that prepared you for this current role at Fluency.
Eric Mayhew:
Well, obviously, the problem started out as a data problem, large data sets to analyze numbers to make sense of. That was definitely a real problem, but what I saw through that was pain points in operationalizing advertising. In automotive specifically, there’s a lot of compliance rules. There are things that software has a hard time modeling and just doing on your behalf. A lot of it lands on the shoulders of people and it was very tedious. The tools in place at the time weren’t overly compelling. I watched a lot of my close friends that were in the ad strategist role go home very late on Friday, sometimes back in the office early Saturday morning to try to make the needs and requests of their clients happen.
Eric Mayhew:
So, I really fell in love with the idea of operationalizing, automating operational processes. That became a real passion for me for the entire time I was at Dealer.com, and that really lent itself well to saying, if we look beyond automotive or even back at automotive outside of the Dealer.com walls, this problem really exists for everybody. It’s a heavy labor problem while you’re still struggling with those eroding margins. So having the passion for automation was definitely what prepared me for starting this platform to make automation something that’s accessible for everybody.
Steve Greenfield:
Cool. One of you or both of you, give us the 30-second elevator pitch. What is Fluency and why does it matter?
Eric Mayhew:
So Fluency is that robot that you can, as an end-user, program very simply. So think of it as the low to no code version of robot programming for digital advertising. So you can set it up. You can express your strategy. Let the data flow in. Let it tailor, customize your advertising and run in a compliant way, completely automated, low labor costs.
Steve Greenfield:
Cool. Sounds like a no-brainer.
Eric Mayhew:
Yeah. I mean, it might’ve been too technical of an answer. Maybe Mike’s got a simpler line.
Mike Lane:
No, no, that is the most simple way to think about it, because really the automation and advertising is not a new concept. We didn’t invent that, but we really focused on the enterprise space of helping large businesses with large portfolios really just get that instilled into their platform, their way of thinking and just how they manage advertising going forward, because everyone wants to get advertising for cheaper, but the dirty secret is the advertising gets more and more complex every single day. It’s not getting easier. The demands that everyone wants is not making that easier to do. It’s making it much more complex. So it’s really where we focus on, on simplifying the things that can be simplified, automating the things that can be automated and really streamlining the process so that people can actually focus on what they should be doing, which is the strategy work, not the task work.
Steve Greenfield:
Interesting. That’s great. That’s great. So before we dive into entrepreneurship and I want to get your perspective on that, Mike, sorry, I got to ask you, so as you reflect back, what’s the craziest story that you can share, at least anyway, about Dealer.com days in the early days? I mean, I’ve met mark a few times. I understand he’s gone on to build a couple of other interesting businesses since. But I mean, any interesting stories you can share from the early days?
Mike Lane:
There’s a million stories. What’s can we share? I guess part of it is just the wild ride of that company. One of the most interesting things that happened to us in the early days, because we were all very young when we started that business, we didn’t have a lot of business backgrounds or even a lot of business mentorship at that time, especially in the tech space. Everyone was all over the place in the early days. One of the most interesting things I think that happens to us is someone had given us some advice that said, “You need to be a profitable company. You need to be growing. Try to double in size every year and get 30% EBITDA.” We just took that as gospel. We didn’t realize that that was nearly impossible to do. We just drove to those numbers every year, and that helped fuel our growth because we just thought that was the norm and not the exception that people were going for. So that is one story of just how we did it. Some of it was just ignorance and just going hard for it.
Steve Greenfield:
That’s great. Eric, I mean, you joined this company midstream. I know you were close to it from the beginning. But I mean, what did you take away as the most important learning from your time and experience there?
Eric Mayhew:
Well, things can be measured in minutes, hours rather than in weeks and months, and that was one of the things that I thought was… Coming from a government systems mentality, coming from things that run very long projects, when you get into the commercial world and you get into something where you are trying to get to that doubling mentality, you really are measuring in minutes a lot of times. So, work can be done. Value delivery can happen in a much shorter timetable. That mental shift, I think, is extremely important for people that if they want to start their own company, they need to be able to think in terms of minutes, hours, days, as well as the big picture.
Eric Mayhew:
So you can’t lose sight of the big picture, but you need to be able to measure in those shorter units and deliver value in those shorter units, and that was one of the things that… When I went to Dealer.com, I worked for Rick Gibbs directly. In my previous company, I was so wildly overloaded that there was no version of success. I mean, I could work 24/7 forever and never really get there. Rick did a really good job of rightsizing the work to about 115, 120% of my capacity. So you could get there. It was just hard. I learned that I loved that and I learned just to set realistic goals that would move the needle forward. It wouldn’t be easy. It wouldn’t be a cakewalk, but it was reasonable, something you could do.
Steve Greenfield:
That’s great. Love it. Love it. Good advice for others out there. So, let’s just turn to entrepreneurship. There’s a debate out there around whether entrepreneurs are born or made. Do you guys feel, as you reflect back, were you guys born to be entrepreneurs or what is something in your life that triggered that?
Mike Lane:
I believe that there’s both out there. I believe I was born with it though, because all I ever wanted to do was just get my hands on something and build it, whether that’s building a swing set for my son. Just go get all the pieces and put it all together, solve that puzzle, that’s something that inherently is just part of me.
Steve Greenfield:
Cool. Eric?
Eric Mayhew:
I mean, I have a very similar answer. I think you’re born with the spirit, entrepreneurial spirit. I think you are made into a successful entrepreneur. It takes discipline beyond just creativity and drive and desire to make these things work. I learned a lot working alongside Mike about what it takes to actually build a business. It’s not just a good idea and it’s not just long hours. It is strategic decisions. It is discipline. It is organization. Those are the things that I think you have to make over time. You have to realize that, because there’s a fun part of entrepreneurship and that’s the playground, right? We all love that part. Anybody that’s an entrepreneur will love the play and will feel like work is play. But there is a part that if you neglect, you won’t be successful. So I believe that there’s a combination of both.
Steve Greenfield:
That’s great. No, it’s a good perspective on the balance. So, let’s have both of you guys reflect back. What’s the hardest decision that you guys have had to make as an entrepreneur?
Eric Mayhew:
So I’m a product guy. I love building this product and we’re obviously a product company. The hardest thing from my perspective was we went after enterprise. We enterprise marketplace, enterprise marketplaces that nobody’s going to pay you for software that doesn’t do much. So, where to draw that line? Where to snap that chalk line up? The product is mature enough to bring to the marketplace, so we don’t lose the splash, but understanding that the roadmap is still long. There are still more things to do always. I mean, that’s the case after we’ve had clients. That was the case up to that. But that decision about when was the right time to bring on that first client was the hardest thing from my perspective. We knew it would move some of our focus away from build, long-term vision build, into more of the sustainability and maintenance and the processing there. But we also felt like it would start to battle test the software. It would start to uncover the things that were going to be issues. So we had to make that trade off. When was the right time to bring that to market?
Steve Greenfield:
Great. Mike?
Mike Lane:
Pretty much right along those lines with Eric, it’s just like those critical tipping points, because as a CEO, I want to get it into the market as fast as possible and get revenue flowing, but there is the breaks that we have to put on and the type of clients you can go after and just being really methodical about how we roll this out. Fluency is still in, I would call, not in its infancy, but the early days, right? We’ve only been at this a few years in a software company.
Mike Lane:
This is an enterprise software stack, so we spent a couple of years building, where we can even get to the area where we can get out into the market. Now that we’re into the markets, and that market has changed obviously in a COVID world, we just… Last year was really our push into the markets, which was not an ideal markets at first, but as everyone became remote, there were workforce challenges. There were some advantages to us coming out as the problems that our software solves with some of the workforce management and automation really address some of the problems that COVID put on agencies and in-house marketing teams.
Steve Greenfield:
Cool. That’s great. So let’s flip to the highlight. What was the sweetest moment you guys have had so far as an entrepreneur?
Eric Mayhew:
Oh, a singular moment, that’s a little bit harder. I can say that the realization that we’re doing this with people that I respected and admire is obviously big and people I really consider my friends. As we’ve grown the company, that friendship circle has grown. The community that we, that we love and are passionate about has grown. I will say this, and I don’t know if this is something we should divulge, Mike and I didn’t talk, but we haven’t taken on any external money. So we have internally funded this. When we were able to transition over from a revenue-losing company to a profitable company in 2020, not having had to take on external money at that point, it was a very big pride moment for me. I felt like we had weathered the roughest seas starting the company. The beginning is definitely challenging. Like I said, nobody pays you anything for software that doesn’t do what they want. So having weathered that storm and getting to the other side of it was a pretty big milestone for us.
Mike Lane:
So far, I would say there’s two chunks. There’s the previous Dealer.com experience, and then there’s the Fluency experience, right? The Dealer.com experience was we got to the finish line with an exit, and that was fun, but it was really building a great company. That was really a proud moment. While that has changed and grown into twice over since I had left, but growing that company and doing that and meeting a lot of people and changing a lot of people’s lives was a really rewarding moment. And then seeing that obviously the transaction was large and that changed a lot of people’s lives again, that was really rewarding moment. And then I guess with Fluency, it’s being able to do it exactly the way we want. We didn’t have to go chase money. We didn’t have to be on someone else’s timeline, building a company with some really great people who are just top performers, and it is really rewarding.
Steve Greenfield:
That’s great. I think of what they call the PayPal Mafia with Elon Musk and Peter Thiel and others, you guys kind of have the Dealer.com mafia. I don’t know how you guys talk about yourselves. But I mean, do you guys think of yourselves that way? I mean, you did change a lot of people’s lives. And then, thankfully, for you guys and others, many of you have decided to plow that back into investing in new concept, new ideas. I mean, how do you guys think about yourselves and how often do you get together and collaborate and such?
Mike Lane:
I mean, I talked to lots of current and former Dealer.com folks. A lot of former folks are doing their own things now, some of which I’ve even invested in, and try to help them. For me, I spend a lot of my free time doing a lot of angel investing and just mentorship of folks on how to get going, because there was a big desire for people to own their own business, to grow their own business, especially in the automotive segment, especially in the automotive technology space, because it is such a big space and there was a lot of room for success and it is changing so rapidly. So, I just try to keep people actively engaged. I have a lot of relationships I’ve kept over the years. It’s really fun and rewarding to see people going after it on their own.
Steve Greenfield:
Eric, so from your perspective, in terms of the culture, the cohesiveness and the culture of Dealer.com, how do you guys continue to connect with another?
Eric Mayhew:
Well, I’ll say from my experience with Dealer.com, there was definitely magic in a bottle there. The community and people that were in that company really had drive. They had passion for what they did. What I thought was most interesting is we’re from a pretty small state up here in Vermont, not necessarily known for its technology, but what I have seen is that what we grew there showed a lot of passion for growing and evolving Vermont and bringing it forward in a safe way so that we’re not damaging Vermont’s reputation, Vermont’s culture, but also allowing the people of Vermont to have good paying jobs. So I can see that in every one of the entrepreneurs that has expanded out from the Dealer.com mafia, if you want to call it that, and in their reinvestment and passion for the state.
Eric Mayhew:
Now, at Fluency, COVID definitely accelerated this. We are remote company, so our family has grown far beyond Vermont. But if you look at where we started, we started to try to make sure that Vermonters, the tech people that we have pulled to Vermont, have places to grow and evolve and choose from. I see that across the board with the other people that I’ve gotten to work from that have branched out from Dealer.com base.
Steve Greenfield:
That’s great. Love it. So, let’s move forward, and Mike can talk a little bit about mentoring now others. What really has resonated with me, Mike, is the fact that you guys didn’t really have good mentors to turn to in the early days, but now you’re trying to provide that function to others that are trying to get started. So, let’s turn to you guys now for advice. We’re going to have a lot of either entrepreneurs or want-to-be entrepreneurs tuning into this piece. I mean, what advice would you give them if you could speak to yourselves 10 years ago?
Mike Lane:
Yeah. I mean, some of the basic advice I would put out there is there are places to go and get help with some of this today. I’m active on a board of one locally here in Vermont called VCET, and that is solely exists to help people get their business off the ground and help you get the resources that you need to get going. These things in every state and every major city now, even small cities, even rural markets. There’s tons of opportunity to get help now. I would say leverage that. That didn’t really exist so much back when the early days.
Mike Lane:
As far as advice, find people that are in the space that have had success. A lot of them will angel invest. They will help you they’ll sit on your board. They want to be part of something. If you have a great idea about growing markets, those are the two best things to have as well, really focus on that and put the legwork in. To Eric’s point earlier, it is going to take a lot of work, but it isn’t just work that makes it happen, it’s being smart about it and being efficient.
Steve Greenfield:
That’s great. Eric, from your perspective?
Eric Mayhew:
What I believe is if you’re going to do this, get ready, you’re in for a ride. There are many hours to put in. There’s a lot of sleep you will lose. Find your way to keep some balance in your life. Pay attention to your family. Make sure that you’re strong in that area, but you will find that you’re going to sacrifice some of your free time. It’s just inevitable. There may be sectors where this doesn’t hold up, but it just certainly holds up in technology. I definitely put in many hours. I think Mike knows that as well. So building a technology product, if you are going to build it and you’re ready to start this journey, it’s an investment. It will take longer than you think it’ll take, and it will be harder than you think it will be. It’s worth the effort though.
Eric Mayhew:
So being on the other side now, knowing the journey that we went through, we talked about moving into that profitability zone, but there was a year and a half where I wasn’t taking a salary. Those were hard times. Those were different times. So as long as you go into it not being naive and somewhat ready for what you’re about to encounter, I think the journey is definitely worth it.
Steve Greenfield:
That’s great. What’s the best piece of advice each of you have ever received?
Mike Lane:
You can’t focus on everything. We’ve used this advice even today in our own business, is pick the three things you’re going to get done today, but also the big three things you’re going to get done this week, and this month, your goal setting, put some boundaries on that. We can’t do more than three things. Make sure those goals are set correctly and just focus on those three things in front of you and get them done.
Eric Mayhew:
Absolutely.
Steve Greenfield:
[crosstalk 00:26:24]. Wise words. Eric?
Eric Mayhew:
Finishing things is obviously very important, to jump on Mike statement. So, get to the finish line on some things. But the one that I really think about is instinct and opinion can get you started, but it is not your long-term play. You’re going to need to find ways to get measurement and feedback and test your ideas because investing, development resources or any of your workforce resources and the things that are just coming from your emotional’s perspective, those can can bite you eventually. I’ve had a couple of those in my career, where I was passionate that I had the right idea and we put some time and energy into it and it just didn’t pan out. So, some of those you have to do in order to get the measurement, but if you can get those measurements early, if you can ask somebody else, your potential users, ask them what they want, do that as soon as you can.
Steve Greenfield:
Great. Good advice. Good advice. So let’s fast forward, whether it’s five or 10 years, post-Fluency, where are we going to find you guys?
Eric Mayhew:
Probably in that cabin hanging out. We’re pretty good friends so I hope… He’s got a wake surf boat there. I learned how to wake surf last year. So I hope we’re doing some of that as we go forward.
Steve Greenfield:
Nice. Mike?
Mike Lane:
Probably investing more in some recreation time versus work time. That would definitely be a goal in front of me, but also continuing to reinvest into the greater community here locally and then just helping others follow their dream, launch their business, see something, the magic happen.
Steve Greenfield:
Very cool. Very cool. All right. Last question before we wrap, since you guys are both involved in auto, I’m involved in auto, let’s talk cars for a minute. If you could own any car in the world from any time, current, past, whatever, what would it be?
Eric Mayhew:
Oh, current or past? Interesting. Ooh. Yeah. I know the car that I want now.
Steve Greenfield:
All right. What is it? Lay it on us. What do you got?
Eric Mayhew:
I’m setting myself up to get… We had an XC90 a few years ago and I loved it. I’d love to get that new plugin XC90, the R type. So, let’s hope Fluency keeps going and I can get there. But you said of all time and that Shelby Cobra is pretty awesome. That’s a car that’s just so classic. I just loved that car.
Steve Greenfield:
There you go. I’m with you there, for sure. They’re a beast to drive, I understand, but yes, beautiful. Mike?
Mike Lane:
That question, I think about it a lot because I spent a lot of time surfing the web, looking at cars, old and new.
Steve Greenfield:
It’s not a Jetta?
Mike Lane:
It’s not a Jetta. I’ve owned four or five of them in my life.
Steve Greenfield:
Oh, wow.
Mike Lane:
I think I’ve hit my quota.
Steve Greenfield:
There you go. Volkswagen will sponsor this episode now.
Mike Lane:
Every college kid needs a couple Jettas is probably the right statements. But yeah, that changes from time to time or hour to hour or from second to second as I’m scrolling on what car I would go back and get. I would probably still want my first car, which was an ’84 Camaro Z28.
Steve Greenfield:
Cool.
Mike Lane:
Take that back just so I can take it out a few more times.
Eric Mayhew:
There’s a little bit of a story to that actually. We have a goal as the founders of Fluency, the four of us, to buy hooptie Camaros and drive across country at some point. So, the plan is some $500. That might be the car that I want more than anything because that means we hit where we want to be with Fluency. But yeah, that we’re going to hooptie across the country with some Camaro. It’ll be great.
Steve Greenfield:
Yeah, you better do before they ban ice cars.
Mike Lane:
Exactly.
Steve Greenfield:
Well, guys, thank you very much. You’ve been very generous with your time. Great, great, great insights about your past and advice for entrepreneurs, and really appreciate you guys carving out some time for us today.
Eric Mayhew:
Thank you.
Mike Lane:
See you.
Steve Greenfield:
That’s it for this week’s Founder Focus, our dive into the inside stories behind some of the most impressive entrepreneurial journeys. Please feel free to contact me anytime. I’ll look forward to catching up to discuss the industry with you. Thanks for tuning in to this week’s Founder Focus, and we’ll see you next week.
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