How a Startup Studio Works

Ben Gilbert (0:00)

Hello, David.

David Rosenthal (0:01)

Ben, how are you?

Ben Gilbert (0:03)

I am joining you from a new location today.

Any different. I am trying out one of these new indoor phone booths that we just got here at the Pioneer Square Labs office. And it's got a nice cushy inside that looked good for absorbing sound.

David Rosenthal (0:20)

I believe on our last LP show where we were looking at our Twitter feeds, you were talking about indoor phone booths. It was clearly on your mind.

Ben Gilbert (0:29)

Yeah. I mean, we constantly have the problem of too many needs for conference rooms and not enough of them. And this is the 2019 hyper efficient solution to that problem.

David Rosenthal (0:41)

How many people work at PSL now?

Ben Gilbert (0:44)

So we have 25 core team employees, but I think across our spin outs, it's over 250 or so.

David Rosenthal (0:53)

And in the office listeners, this will become relevant in just a minute, as you already know from the title of the episode.

Ben Gilbert (0:59)

Good question about in the office, 50 to 75, I think. We regrettably only have two floors right now, so at some point when the companies hit 10 or 12, they gotta go find space, usually close by in Pioneer Square.

David Rosenthal (1:12)

Hence the need for phone booths.

Ben Gilbert (1:14)

Hence the need for the phone booths.

Today, we are doing an episode on Startup Studios. We've had tons of requests for how does a startup studio work, and what actually does that term mean? I sort of thought it was funny that despite David and I spending a ton of time with you all, we actually rarely talk about our day jobs. Four years ago, we started Pioneer Square Labs, and startup studios weren't really a thing, and we started right around the same time as HiAlpha, and there had been some other previous things, such as BetaWorks and Science, and the original Idealab that had started before, but now there's like over 100 studios in all these different cities, and a handful of unicorns that have come out of them, and industry associations, and it's this whole thing that I think has sort of been begging for a little bit more explanation on what they actually are.

David Rosenthal (2:09)

Yeah, and I haven't really seen or heard any really good content out there from people like yourselves who are founders of these new wave of studios talking about them, so I'm excited to talk about it. And we should clarify the we of doing all the great work of starting this is not me.

It's you and your co-founders at PSL. I'm stuck in the old school traditional venture world.

Ben Gilbert (2:34)

Tried and true, baby.

David Rosenthal (2:36)

But this is great. I get to learn a lot more about, well, I already know a bunch, but along with our audience, get to reiterate and learn a bunch about what you guys are doing.

Ben Gilbert (2:45)

So where should we start, interviewer?

David Rosenthal (2:47)

Well, let's go back to 1890 No, obviously Ben and I both used to work at Madrona Venture Group in Seattle, and you and your co-founder, Greg Gottesman, had worked there, worked at Madrona Labs within Madrona. How did you guys start thinking about bringing back the studio concept? You mentioned Hayalpha was out there, and obviously we know Scott, but it wasn't like it is now, where there are a ton of these out there. How did the idea kind of form?

Ben Gilbert (3:17)

Yeah, well, all that credit goes to Greg.

Greg had started Rover by pitching it at a start-up weekend as we've well covered on this show, and hired Phil to head up the technical side of the organization, and served as interim CEO for a handful of months. And Aaron was an entrepreneur in residence at Madrona, and so Greg, over the period of time of trying to show some proof in the business, and Phil really building product, convinced Aaron that Aaron should jump over the fence and be the CEO. It really occurred to Greg, well, gosh, if I can do this with one company like Rover, maybe I can do it systematically. So that was sort of the birth of Madrona Labs, and we had started two companies there, Mighty AI, which just got acquired by Uber's Advanced Technology Group for their self-driving car stuff and all the data labeling, and Reply Yes, which was acquired a little bit earlier by Nordstrom, which was a SMS-based e-commerce company.

David Rosenthal (4:17)

I didn't see that Nordstrom had acquired Reply Yes. That's awesome.