I have the hearts and souls of the future of Europe in my database. You don’t have enough money to buy that, and I would never sell my business to you

Sixteen years ago today, I was on the road to Jerusalem.    A month earlier, I would have laughed if you had said that I was going to spend the Millenium in Tel Aviv, but I did, and here’s how and why.

It was roughly 1 December 1999, and I was in the Rome airport for some reason, travelling for First Tuesday, my previous business, and I asked myself a very basic question which a lot of entrepreneurs probably did in those heady days of 1999:   ‘Where can I go where they don’t celebrate Christmas so that I can keep working straight through with no stops?’

I laugh now just writing that as I am the queen of downtime (take half of Saturday off, sleep in to 8 am on Sunday, spas, weekend breaks etc), but not then.

I stayed at the Dan Tel Aviv Hotel and networked up a storm as INSEAD, my business school, is strong in Israel, so I met a lot of valuable people, and I had a lot of work to do for First Tuesday.    15+ hour work days 7 days a week were the norm for me, and frankly, most internet entrepreneurs at that time.   I could do that without breaking a sweat at age 34.

Everywhere I went in Israel as I mentioned First Tuesday which was the original pan-European investment platform connecting entrepreneurs and investors across Europe, Israelis said, ‘Sounds like Yazam’.     First Tuesday had by mid 1999 500,000 people receiving our digest and coming to our events across 100 cities in Europe.  I had never heard of Yazam, but quickly learned that they were doing what we were doing and intending to do, but had just received ￡20 m in funding from Carlyle Group, and Shlomo Kalish was the Chairman of Yazam.   Yazam meant entrepreneur in Hebrew.

I asked everyone where I could meet Kalish, and was told:   ‘He’s in Jerusalem; you’ll have to go there, and after the New Year.’    So I waited until the 1st of January, and then hired a car, and drove to Jerusalem.   

The first two people I met in the UK in 1998 when I arrived were Tim Jackson, the founder of QXL, and Brent Hoberman.   Brent introduced me to my co-founders of First Tuesday, and Tim offered me a job, which I declined, but then having built QXL, he went to the Carlyle Group, and he put me in touch with Kalish.

So there I was in Jerusalem, and I arrived in the Yazam offices, and asked for Shlomo Kalish.   To say that they were waiting for me is an understatement.    I walked into a long conference room with 20 Israeli Investment Bankers all with the Kipa / Yarmulke, and there was me on the other side of the table with my little pink sweater on (why did I have to have only the pink sweater clean by the end of the week?).   Outnumbered, outgunned … I told them about all of my plans for First Tuesday, and they listened, smiled, kept pouring me coffee, and then Shlomo stood up and said:

‘Julie, that’s all very interesting.   We have ￡20 m, and you don’t.   Why don’t you become part of Yazam, and fulfil First Tuesday’s potential through Yazam?’

Well I certainly hadn’t expected that.    I mean, 5 coffees, and 60 minutes of chat, and you want to buy my business?   I mean, can we date before we get married pls?    I just was curious really about who you were, and was in the neighbourhood…..

People in my family don’t work for other people.   We build our own businesses, and my father built an industry.  

Never sell your business.    Cashflow is a wonderful thing.   Capital gains… well….   What are you going to do with all the money but build another business?

Before I could say Kipa, I found myself saying to Shlomo and his 20 colleagues, ‘Gentlemen, never would I sell my business to you, but don’t take it personally.    Let’s just see how things work out…. Shall we?’

To which he responded, ‘What do you mean?’    I said, ‘You know – who buys whom.    I have 500,000 entrepreneurs who love my company and read my newsletter daily, come to my events monthly, and send me love letters telling me how I helped them raise capital.   Quick back of the envelope last week in London, we facilitated ￡150 m of capital raise in London so far this year…. Get it?    You think ￡20 m is a lot?    I have the hearts and souls of the future of Europe in my database.   You don’t have enough money to buy that, and I would never sell my business to you.’

So they assigned a young investment banker named Michael to follow me.    Through airports, to conferences, to our offices, follow Julie.   Get her to give us the keys to First Tuesday.

Michael had a heart attack following me, and that’s not funny, but true.    But in the meantime, young Michael figured out what was going on.    Julie was doing all the work in London with absent co-founders in the Valley.    We won’t go there.   I wash negative stuff out of my life.

Michael told Shlomo that she will never sell, but the absent guys in the valley will, so just focus on them. 

The rest is history and you can read about it in my book, Welcome to EntrepreneurCountry.  $50 m for First Tuesday, and 96 hours of due diligence by the 20 Israeli investment bankers who forgot to check whether any one person had physical possession of the database… those were the days…

There are a couple of lessons for those who are interested in what you can learn from Rookie 1.0 mistakes:

1. Companies are acquired not sold
2. Choose your co-founders more closely than your husband or wife
3. Make sure that everyone has skin in the game
4. Take time off at Christmas, but always stay curious … in my experience, it’s the dinner party you almost didn’t go to where you sit next to the guy ….