How I Built This with Guy Raz - Ring: Jamie Siminoff

Episode Date: June 22, 2020

Jamie Siminoff spent much of his twenties and thirties as a serial entrepreneur, launching three tech businesses you've probably never heard of. When he finally landed on a breakthrough idea, he didn't realize it at first; he was just trying to solve his own frustration of not being able to hear the doorbell while tinkering in his garage. His jerry-rigged solution evolved into Ring—a doorbell with a camera and microphone that connects to a smart-phone app. After a nail-biting appearance on Shark Tank and a nearly disastrous launch, Jamie was able to rebrand and grow the business, eventually selling to Amazon for roughly $1 billion. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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tall windows, beautiful old details, and plenty of space for all of us. And being in that home on Airbnb, right in the middle of Vienna, walking distance from so much of the city, made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place with a place with a all of its personal touches and its amazing location could make someone else's vacation even better. Your home might be worth more than you think. Find out how much at Airbnb.ca.com slash host. Hey, just a quick heads up before we start the show. There are a couple of swear words in this episode, so you may want to keep that in mind if you're listening with kids. Okay, on to the show.

We start hearing, it's like the week before Christmas. People are contacting me and saying it's not working. and their video was coming through like an old TV like tuner. Like it was like all like lines through it and just you couldn't see the picture. So most of our units are now in the field with customers that not only do they not work, but we can't change that software on them. So they're basically bricks. You cannot fix the ones that people have. Yeah.

You can't rewrite the software on this chip. And so this was like the end of the world. Like this really was. Basically the business is over. From NPR, it's how I built this, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz, and on the show today, how Jamie Simenov figured out how to answer the door with his iPhone and how that little side project grew into ring, a business he sold for a billion dollars.

From time to time, all of us have to do things we'd rather avoid. like go to a party we don't want to be at or meet a friend of a friend of a friend who really wants to meet us. But I'm willing to bet that more often than not, when you do do those things, the outcome is actually better than you expected. And sometimes it can be life-changing, as it was for Jamie Siminoff,

the founder of Ring, the company that makes the famous video doorbell. Several years ago, Jamie was struggling to get Ring off the ground. And he wasn't feeling particularly confident. To the contrary, he was feeling like a failure. And around this time, a friend of a friend who wanted to launch a business asked Jamie to lunch. The guy needed some advice. And Jamie very reluctantly went to that lunch. But if he hadn't, there's a pretty good chance we wouldn't be telling his story today. You'll hear about that lunch a little later in the show. But if you know the back of the envelope account of Jamie

Simeonoff, you'll know that he invented the ring doorbell in his garage in L.A., and then seven years later, he sold his business to Amazon for a billion dollars. But the path to getting there was actually really slow and really messy, full of bad business ideas and some good ones that never got traction. And as far as the ring doorbell goes, Jamie didn't invent it to put it on the market. It was a home improvement project. He invented it to help him hear the doorbell from the garage. Anyway, for now, what you need to know about Jamie is that he grew up in northern New Jersey, where he admits he kind of floundered at school. But where he thrived was at home, tinkering with stuff. I would come home and go in the basement. You know, I had RC cars, which were,

Radio control, yeah. Yeah. So I had all these like the clodbuster and the frog and the like, it was like. Oh, the frog. I remember the frog? Yeah. Because this was a time where you wouldn't just go to the store and get them all made. You had to buy the components for the radio control car and like you would go to a hobby shop or radio shack and put them together.

I'd go there and it was like a big thing to buy one. I mean, these things were like expensive. Yeah. And they would break. Like the greatest thing about them is that they broke. Almost every time you used them. And so I had to fabricate parts, fabricate tools. And I wasn't like, you know, a kid saying, I'm going to fabricate a tool.

It's just like my frogger's broken and I want to go play with Andrew down the street with his. Like, I need to fix it. And so like I just had to do this stuff. And then I learned like, that's how I learned engineering. I mean, I learned electronics from it, you know, from the speed controllers, the servos. I learned gears and mechanical. Yeah. It's probably looking back like the RC cars might have been one of the bigger influences in my life.

of that, yeah. What, we're going really, we're geeking out, we're getting really deep into hobbies. Like servos, you're going to servo motors. I remember those things. Oh my God, all right. People are going to be like, this is weird. But I think I guess the point of though is like it's like how things work.

Like the fundamentals of how things work, even in like as things are more complicated, more computing, like still the fundamentals are the same. And so when you learn the fundamentals, it's incredible how you can sort of go up the stack. Yeah. And do more complex things. So you were that kind of.

kid, right? Because it sounds like you were maybe not like a video game kid necessarily or maybe a little bit? Yeah, all I wanted to do is be in the basement just building stuff. And I had like tinkering. Yeah, like balsa wood like three 3D printers. You could make anything out of Balsawood. Like you could just shape it. Oh man, I made a I made a bridge with Balsawood like with a little Xacto knife and cutting it at angles and then gluing them together or just pushing it, right? Yeah. And in In high school, I had this architecture class, and in year three of it, you built the house that you had like, like, first did the architecture. You, like, did the whole plans.

And then you actually built a model of the house. And the model that I built, I remember, I wanted it to have cedar shingles. And my teacher is like, you can't do it. It's going to take too long. And I'm like, it has to have cedar shingles. And so I cut individually out balsawad shingles and glued them onto this house. And I don't even know how many hours it took me. and I don't know why I did this, but I did finish it.

Just for people listening who have no idea what we're talking about, it's sort of like taking a thousand garlic cloves and slicing them very, very thin for hours and hours. Yeah. So model cars, balls of wood. That was your thing. That was what you loved to do. So you are not a great student, but a fine, you know, okay, student, like what,

like bees and Cs? Yeah, like bees and Cs. And then what happened, Land Rover did like a thing in my town. Like they brought new cars to it. And my dad and I just went. It was like in the park. And this Land Rover Defender 90 was being brought into the U.S. And it was like seeing that thing.

I can still picture myself seeing the like this at this moment. Like it's in my head right now. And I said to my dad, I'm like, man, I would do anything to have that car. My dad goes, get straight A's. And I literally did. The first semester, I actually got one B, and I was devastated, and my dad said, I'll extend it. And then I got straight A's the next semester. And it was my junior year, which ended up being super critical for college admission.

And so it was this amazing thing where, yes, it was a bribe, but it helped me so much in my life because it's helped me get into probably a better college. It was kind of an incredible thing. So you got the car with straight A's? Yeah. And you go off to college. You went to Babson College, which is kind of a. Not a super well-known school, but mainly focused on business and entrepreneurship. How were you as a kid who was a tinkerer?

How did you think I want to work in a business? Because I don't know, were you selling stuff? I mean, were you kind of already doing businesses on the side before you got there? I was. I was doing lots of entrepreneurial things, but not realizing they were like entrepreneurial. So I was on the way to school, I was like, you know, that we lived in a place where there was horses. And so on the way to school, I'd like shovel people. horse stalls out on the way to school. I could make like a couple hundred bucks a week doing that.

And every parent that was in business or did anything, I would talk like, it's kind of funny looking back, but like my friends would all be, you know, down on the couch playing games. And I'd be like with the dad talking to them about business or trying. Like I wanted to learn all this stuff. And the way I got to Bapsin was I used to drive this kid to school who was like the wealthiest kid in the town or whatever. I remember being in his kitchen one morning and he was always late. and the dad came down who I like really looked up to and always wanted to talk to him. And he said to me, just kind of off the cuff, you know, he's making his coffee and said like, oh, where are you applying for colleges? And I gave him all these colleges that were like liberal arts, like, you know, just sort of general colleges.

And I said Bapson and Bhapson literally just been thrown into my list. And he goes, huh, Bapson. He goes, you know what? Because the most interesting and successful people I know went there. And then he just goes back to doing his coffee, whatever. I drive to school, drop this kid off, go straight to the counselor's office. And I'm like, I'm going to Bapsin. How do I get in? What do I got to do?

Wow. That was it. I heard that from this guy and I was in. All right. So you get to college in the mid-90s, and you had this kind of background and tinkering and electronics background. I should be just this basement kind of taking stuff apart. Were you still kind of doing things related to that when you got to college? So it was a little bit. When I got to college, I mean, I sold electronics on the campus. So I had a company called Gadgetronics, you know, gadgets and electronics.

TVs, stereos, all that kind of stuff. So I was always hustling. How are you getting, you were, like, sourcing electronic components and selling them on campus? So I found there was a girl at school, and her dad had an electronic store in Houston, Texas. And, yeah, I was able to convince him to sell my stuff at a lower price. And so, yeah, I was basically like, I wasn't trying to think about business in the way of, like, I'm going to try to create a career or something, like, company. I was always just hustling. I was always like doing stuff and thinking about like, where's there a need hustle?

Where's there a need hustle? A buddy and I in college, we put posters up all over the place. You know, for $15 an hour, we'll do anything. And so we'd pay kids $10 an hour and make the difference. This is Wellesley, Massachusetts, really nice town. The horrible things people would have you do for $15 an hour was pretty unbelievable. But, you know, we were happy to make, you know, make a little spread. So you were like task rabbit,

before task rabbit. Yeah, yeah. But it doesn't sound like it was like build my IKEA furniture. It sounds like it was... Oh, the best one ever. And we would obviously also sometimes want to make the $15 an hour, so we would just do the work ourselves as well. And so one of them was this huge hillside full of poison ivy.

And they're like, can you just pull all this poison ivy out of this hillside? And we're like, hell's yeah. Oh, I mean, that was like... For $15 an hour? Yeah, at the time that seemed like a lot. You know, beer money-wise, that was like, that was very... very good leverage on the dollar. So, wow. All right. So you graduate, and I'm assuming you, like a lot of kids who graduate from Babson, you're thinking, all right, what am I going to do?

So what did you do? So I got contacted by like a friend of a friend, and they were opening up a hot dog chain in Hoboken and wanted a business plan to raise money. And they, you know, kept asking, like, would you do this? And I'm like, no, I don't, wasn't really. And they're like, well, if you would, how much would it be? And I'm like, I don't know, $10,000. To help write them a business plan? Yeah. For their hot dog company? Yes. Okay. I just said like $10,000. Like, I mean, I literally was like, you know, like a joke. Like, sure, for $10,000, I'll come do this. And they said, yes. And I'm like, okay, done. Like, for $10,000 will do anything. I had no idea what I was doing.

And so I started doing this business plan, which I guess, I think it ended up being, I guess it was okay. And then I, from that, I got other business plan jobs. And, and, and, I, I guess, And so I started a company called Your First Step, which was a business plan company. Oh, wow. So I kind of started doing this thing. And I just every, because I didn't like doing it, I kept sort of raising my price and people kept paying it. It was during the dot-com boom, too.

So people were, you know, a little bit had lost touch with reality. Yeah. But how did people find out about you? I mean, this is Hoboken, New Jersey. You do a business plan for a hot dog guy. And then how do you get your next client? So it's funny. just kind of like, and again, I didn't need to have the world know about me. I just needed to have

the next job know about me. So it was, you know, and I was doing these every couple months. So it wasn't like I was doing hundreds of business plans. I was just doing a few. And by the way, this was the era before like a business plan today is got to be five slides and that's it. Like that's what people want to see. This was like kind of pretty, it's like like the clip art era. Oh, the clip art, market studies. I mean, it really was. It was funny. You got a lot of points for how it looked. So I ended up figuring out that I could get a, a book binder, which was like a thing that would make it a hardcover book. Oh, these were physical business plans. Of course. This was not a digital business plan. So I realized if you made them

into a physical book, like you just gave that to someone. They were like, wow, this is real. This is good. And everything inside of it was just crap. I mean, it was, how would I know what to do with a business plan? And again, looking back, if you needed a kid to write your business plan, it means you didn't understand your business. Like, it was just, it was bad. And I think I read that, that a, that a around this time, like, this is like the late 90s, somebody actually asked you to work on like a random business plan in Bulgaria? Yes. And I went there and it was like January, February of 2000.

And I think like for my type of brain, those places were like, they were like an empty canvas to an artist. Going to a place where there's so much that needs to be done, my brain wanted to explode. There was just so many businesses, so many things you could do because it was, things are just kind of coming out and people are, you know, there's just everything was needed. Like it was pretty exciting. So, so I go there, I do this business plan and then I meet a guy who's doing voiceover IP. And so that was like my first transition from, I'll say, from being like this service business to actually getting into a real business. This is the early days of voiceover IP. Super, super early. somebody who's like, hey, I want to do voiceover IP and make that the new telecom of Bulgaria?

Was that the idea? So what happened was is all, like there had never been the ability for a individual, like a not a sort of either a government entity or a giant telecom company to send a call from one place to another. You needed physical lines and like, I mean, it was like you literally had a boat like, you know, putting copper through the ocean. I mean, it was like real. And so what voiceover IP did is it allowed.

literally like two guys in an office to deploy these gateways and send a call from the U.S. to Bulgaria. And so what you could do is you would get local phone lines. You would get a little apartment and you'd put this box in there and you'd send the call through the internet and then you'd dial it out locally. And your cost was the internet cost plus the local charge, which usually was basically free. So now I'd call to Bulgaria instead of being 25 cents.

was the cost was called a penny. And so you would sell a phone card against that. And this is what sort of opened up all telecom globally. So you decide to stay in Bulgaria, I'm assuming, and like pursue this idea. So when I got into this, I ended up basically being a nomad because once I got a place started and going, I didn't really need to be there that much longer. And the partner was based in the U.S. and he understood the technology. And I was, sort of the one who, I wouldn't even say I understood how to do this. I was just willing to like, I'll just go and I'll make this work. Like, I'll figure this out. Huh. But as I understand it, from what I read, the business kind of goes into this like roller

coaster mode. Like initially it did really well and you were able to expand to a bunch of countries. And then like the guy who you partnered with who understood all the technology, like he, I guess got into like some money trouble and took off and things kind of fell apart. Correct. So what happened? Were you able to salvage it? Yeah. So basically my partner ends up this, you know, he's gone.

I have this network, but I didn't understand really how to run it. And across the street from my apartment in New York was a Barnes & Nobles. And I went over and I bought this Cisco how to voice or IP book, which was like 700 pages. And I read the entire book cover to cover to figure out how to program these gateways so that I could turn them back on so that I could run this network because it was the only way to get out of this thing was to try to sort of make it work. There was people that I owed money to that said, you know, you owe me money. And I said, listen, and this was a good lesson for the rest of my life, which was, I want to pay you. I'll work hard to pay you. But if you shut me down now, I'll never be able to pay you. So like, we just have

to work this out together. And through doing that, two things happen. One is I got the business going, started up again, which was, which was great. The second thing that happened was I actually understood, again, going back to the RC cars, I understood, like, really how to fix them. At first, I didn't even understand what I was doing. And then when the business collapsed, I literally had to learn the other side. Like, I had to, like, read the Cisco book and understand, like, I understood why Voice of IP now, to me, before this Voice of Rip was just a protocol that was doing something that I was making money with. Now I understood why it was so powerful, how you could saying calls, how you could do stuff. And so that really like that, you know, then I became like

a voice of IP technician and engineer and architect of networks. And so I started building this back up. And then another kid who went to BAPSEN had been doing a phone card business that didn't have a network. I was a network without a phone card. He had the customer. I had the logistics. So it was like putting together the supplier and the distribute, you know, putting that whole thing vertically integrating it. And so we both saw the benefit of that, put it together. And You know, it was good. How long did you do that? That was, so it was 2000, we merged in 2002, and then I think I sold out in 2005.

So it was like three or four years with him that I sold my stake out. And you were, by the way, living in New York at the time. I was living in, no, I was living in California now. We moved to San Diego, the company in 2002 or three. So that brought me to California, which I then met my wife who was in L.A., and so that kind of kept me here. And we should say you didn't do too badly on that sale. I think you walked away with about like a million dollars, right? Yep.

By the way, were you making money in all those years? Were you being paid? I took like a founder's salary, not a, I wasn't driving around like in fancy cars. I think at the time, so I think when I got the money from the sale, I maybe had like $5,000 in the bank or something. I mean, I was always sort of just, you know, scraping it by. All right. But now you've got a nice chunk of cash. And was your idea to immediately do the next thing, use that cash and start the next business?

So it's funny. When you say idea, it sounds like I was planning things out. For a long time, I think I was more like a snowball, just kind of flying down a hill, trying not to crash into something that was going to blow me up. So it wasn't as purposeful as like, oh, I'm now going to do the next company. I had already started playing around with voicemail to text at the time. And so I'll say I just moved my focus there because I didn't have anything else to do. So I just kind of moved the focus to that and really kind of doubled down on that business.

So tell me about it. How did that idea even come about? So it's, you know, the BlackBerry is out. People are, you know, clicking and stuff. This is like, what, 2005? 2005, yeah, going into 2006. Yep. And you have this idea of to transcribe.

voicemails. How did you come up with that idea? So I was with like a friend mentor, this guy, Bill Wachtell, really successful lawyer in New York, who was visiting L.A. And we were just kind of, you know, we were going to go out to dinner. We were sitting around talking and his son was there. And it was like, you know, the dad's yelling about a voicemail message or something. And he's sitting on his Blackberry. And I kind of been thinking about this, but it's like, I just kind of blurted it out and said, what happens if you could read your voicemail? And he was like, that'd be great. I'm like, let's do it. He's like, let's do it. And so that was, that started the business. It was like one of like, we'll just do it 50-50, done. Like, we're just going to do it. And he helped fund it.

And because I understood voice of IP because I understood the telecom networks now. So again, like this is building on, I had some fundamental knowledge of how to route a call, how to build a voicemail server. So I literally built a voicemail server. And we built this little system to be able to transcribe voicemail messages and then send them to you his email. And what was it called? It was originally called Simulcribe, simultaneous transcription. Again, you know, like Gagetronics. You're seeing probably a trend here. And then we renamed it to phone tag because we realized that Simulscraib was a terrible name. And, you know, it wasn't going to be the biggest company in the world. It still exists today. It's an interesting service. But yeah, it wasn't, you know.

And who were your customers? How did you, who, who were you going to get to use the service? So the original idea was that we would go direct to consumer. And so we literally would just, you know, people, you could just go to phone tag and you could reroute your voicemail to us and pay us 10 bucks a month or 30 bucks a month. I can't even remember. It was a website that you would say. This is pre-apps. Yeah, exactly. Exactly. This is pre-apps, mostly Blackberry. And then we went to AT&T and Verizon and Sprint and tried to get them to add it as a service that they could add, which was a great, you know, lesson of if you're a small company, trying to do deals with big companies, it's almost guaranteed to be a kiss of death because they just take so much time and so much energy out of you. And it's so hard

to get something to happen there. So it was a real slog of a business. Right. All right. So you have this business. And then from what I understand, and I think anyone listening here could see the foreshadowing coming, Google voice comes out with a free service to transcribe your calls for free. And if I'm you, I'm thinking we're done.

We're sunk. Yeah, I think I thought even worse than that. But yes, no, it was a tough day. And it's one of those funny things because I, On the outside, I had to come out and be like, this doesn't matter. We can fight this. Like, we're bigger than this. And inside, I'm like, we're so screwed.

Like, we are done. Do you remember when you found out about Google Voice? Oh, my God. I remember writing this blog post that I wrote that morning. It's like almost a movie where the person's just smashing the keys. They're just writing so fast. What did you write in the blog post? I basically wrote that there's no way for you to do this with the way telecom networks work

and that they will just end up having to lose money on this. Google. Yeah. But it sounds like this was like an angry screed because Google, of course, is going to crush you. Yeah, it was like the writing was on the wall. I mean, it was like, you know, it was, yeah. Why would somebody pay you $10 a month when Google was offering it for free? Like, free is a better price than $10. It's better by $10. It's better by $10. You can actually put a number on that.

So what did you do? I found this small public company called DITEC, which they were in the telecom business selling services to carriers. So we sold it. I mean, I was able to sell it for to get the sort of investors their money back. I read they bought it for $17 million, which to most of us sounds like a ton of money,

but it wasn't actually a ton of money. You got to read between the lines. So like I was, I mean, something I've always been sensitive to is like the fiduciary responsibility to investors. And so I did get every dollar back to every investor. So no one made money, no one really lost money.

Exactly. Like, like, let's put, out of the 17, I got basically zero. So I got my, the money I had invested, I got back. Right. So, which was amazing. Yeah. And so then I came up with my next idea, you know, which is, it's like, almost, it's like going through it like this. It's almost like exhausting.

I'm like, yeah, and then I went under the next one. Well, so, but it sounds like that was kind of the plan. I mean, you sell a company, but you come up with things and it sounds like you're kind of restless, which I think many, if not all the people who have been on the show are. And what's this new idea? So this was unsubscribe.com, you know, which is, spam had been solved, but spam meaning like emails that are like not legally sent, basically. So like those have been like sort of the filters for those have been really tuned to get all that out.

The problem you now had was like it's legal email, but it's filling up 50% of your inbox. And so I got this idea of if you could automatically unsubscribe from things, you could clean out 50% of your inbox, you could give back time to employees or yourself and sort of make a service around it. It is still to this day, I think one of the best products I've ever done and one of the worst businesses I've ever been part of. So like the financial side of the business is as bad as it gets and the product was just awesome. So just to clarify, today on my Gmail, it's awesome. Google will say, hey, you're not reading this thing. Do you want to unsubscribe? And I just say, yep. Yeah. So it was that before that.

So there wasn't that feature on Gmail. You basically get the button like you have now in. It would show up. We'd actually insert the button through an extension in your browser. So every time you got an email from somebody you didn't want, you just hit the unsubscribe button that you had on your browser. I got you. Exactly.

And what's your business model? Were you trying to sell it to companies? Yeah, it was like a per... The idea originally was like a per seat fee. You know, if you take 50% of someone's email and clean it out, like the amount of time times X number of employees, you can kind of figure out this return. And it just everyone agreed with that.

They just didn't want to buy it. And so it just ended up being like a business that no one wanted to buy. Like everyone loved it. They individually liked the idea. They just wouldn't buy it. And so I played out every which way I thought the business could go, like we could be this. We could do this. And I couldn't figure out how to make the company bigger than like $30 million in the next like

three to five years. So, you know, I'd raised two. million of venture capital and if the best you can do like if just the whole world was behind us was like 30 million in revenue and that's when I realized like this is this is just not going to end well it's it's not going to be able to make enough money no so what did you do so I I fortunately through just meeting people and stuff met someone who is in the identity space what's the identity space like life lock like that kind of identity identity identity protection space I got trusted ID and we had built a lot of tech around this and they thought it would be a great additional thing to add to

their customers. So if they could add this as like another feature, you know, we have this, this, you know, credit card, this and unsubscribe. And so for them it was like we could just add this is another feature. It's great. And so I was able to, in essence, you know, dollar for dollar, again, like this is, you know, this is if you're following the trend line here, this is not good, build business up, sell it, get investors their exact dollars back. Like this is not a, you know. So you got an exit, but not this is not like. the, because a lot of times when people think of, they'll meet someone and they'll say, yeah, I sold my business. And a lot of people think, man, that person is like, you know, but actually most of the

time when people say, I sold my business, it doesn't really mean that they walked away with lots of cash. Yeah. A lot of times there's people like me who are basically getting the money back to their investors or even, you know, getting half the money back to their investors. You know, it's like fortunate, in some ways, fortunately, I was able to get the full money back to investors both times. So you are in your late 30s. You don't have a whole lot of money. But I'm assuming you're thinking, okay, I got to figure out the next thing I'm going to do or I got to get a job or something like that. So luckily on this one, I call it my entrepreneurial midlife crisis.

I remember having this just like, you know, almost like this collapse of I keep doing these things that I invent something. I get excited. I get into it. And I also look at it as like railroad tracks. Like once you raise money for something, you turn a road into a railroad track. And what I mean by that is you can't turn. And so like unsubscribe. Like I realized pretty quickly it was bad, but I'd raised $2 million.

So like I'm on a railroad track now, which is going to burn up time. Same thing with phone tag. Like, you know, I wasn't passionate about voicemail. Like I thought it'd be fun to do. And then all of a sudden I'm in this thing where I'm like slogging every day. And so I kind of sat back. And again, this is by far most important part of my life. and I realized that I was an inventor and not an entrepreneur.

And by that, I mean, entrepreneurs want to build a business. An inventor wants to literally invent a product or service to just get it out there. And I decided from that I'm just going to go to my garage, hire a couple kids, and we're just going to build ahead. All these ideas that I've been writing down in my phone and the notes section. And I'm just going to start to play with these and try to not get on a railroad track. play with them long enough to see what actually becomes something and has the ability to become something meaningful before going sort of too deep into it.

All right. So you say I'm going to go into my garage and hire a couple of kids. And like when you say kids, like I'm out of college kids. Like literally I employee number one, John Modesteen lived in Philadelphia. I always joke, never got west of the Mississippi. I literally flew the kid out here. And I bought him a bicycle. and he would ride from his apartment to my garage to work on this stuff.

And what did you say to him? You said, hey, I don't really know what the next thing is. I just want to tinker, and I just want you to help me do that. Was that what you said? Basically. I mean, I had, so at that point, I had him working on a thing called Snap Garden, which Snap Garden was this idea of building modular thin tiles that would go on your patio and that you could grow food or grass on or whatever with a centralized,

watering system. I love that idea. There would just be like rubber mats that you could just have sections of a garden on. I love that. Yeah. I want that, especially now. Yeah. You could have tomatoes and parsley and like you can have like mint and all the different things and on your sort of patio in your apartment. And my whole backyard was growing tables, trying to figure out how to grow on these almost like a saran wrap. And I mean, none of it ever worked by the way, but we were trying all this stuff. And these ideas were just like ideas that would come to you in the middle of the night and you'd write them down a piece of paper. Like, because we all have crazy ideas, but you're like, I've got a bunch of these ideas. Yeah. And this is the one where you thought, this has the most

promise. This one, and we had like four or five other. I had a, I had a conference call idea called Pokedy Poke that would call you when your conference call is about to start. I love that. And dial you into the conference call. So Pokedy Poke. We had POP the portable power, which was a big battery that you could like sit on a table and charge all your phones. So there was different things. And you just hired a couple people. And I'm just trying to understand. Was your garage like full of like soldering irons and like a horse?

Like what are this called? Saw horse. Saw horse. It was. Yes. That's exactly what it was. Really? Mayhem, I guess.

Like we were just kind of like, I mean, there was ideas. And then we were like, we're going to work on this. We're going to try to do this with Snap Garden. We're going to try to do this with it. I mean, it was like, I mean, looking. back again, like you're kind of exposing. I don't think I'm a great sort of operational manager because, yeah, I don't think we really had a plan for that. All right. So you guys try SnapGarden and you just cannot get it to work. It's you and two like recent college student graduates.

Yes. And just kind of trying to figure out what to come up with. Yeah, nothing had been working. And the one big pain point I had, which was a personal pain point, was every time a package was delivered or someone was at the front door to visit because now people are coming to my office, quote unquote, which is, you know, again, my garage. I called it our two car office. My phone didn't get signal in the garage. And the doorbells, those wireless ones, wouldn't reach to the garage, just like they wouldn't go through all the walls or whatever. And the garage was like a little separate unit like going to a back alley. And I couldn't hear it. So I didn't know when someone was at the front door. And, you know, that was the greatest position to put myself in looking.

back because that's what sort of started at all. When we come back in just a moment, how a random lunch meeting with a friend of a friend that Jamie reluctantly takes ends up leading to the luckiest break he could ever ask for. Stay with us. I'm Guy Raz and you're listening to How I Built This from NPR. Hey, welcome back to How I Built This from NPR. So it's around 2011 and Jamie Siminoff is madly tinkering in the garage trying to come up a brilliant new idea for a business.

And in the meantime, he's trying to solve a problem just for himself, which is, how can he hear his doorbell if he's all the way in the garage? And he thinks maybe he can rig up something with Wi-Fi. Actually, it's funny thing is I looked for a Wi-Fi doorbell. So I didn't, it wasn't a immediate, I'm going to invent a Wi-Fi doorbell. It's, let me buy a Wi-Fi doorbell. And so I searched for one. There were chime doorbells, right?

Just a chime, a wireless chime. So the problem was none of those would reach to my garage. Oh, you couldn't hear it. Yeah, so that was like the greatest thing ever. Because if one of those reached to my garage, I'd probably be still trying to build gardening things for people's porches. So you wanted something that went to your, that made a chime sound on your phone? Correct. And then I thought, like, I mean, you have the, so now, like, now I'm starting to invent.

You know, it's like I have the phone. Wi-Fi cameras were starting to come out. So it's like, why not have a camera that, you know, you know, you know, You could talk then also that would go to your phone. So it's like, oh, now this is like I'll take the intercom and I'll take the doorbell concept and the fact that I have this phone with me that's on Wi-Fi and I'll put it all together. And that was I started building this gigantic thing that I was trying to strap on my front door. All right.

Here's a question. At that time, video door, like a video intercom existed. They were expensive, but it existed. you could have installed that, right? So a wireless inversion version did not exist. I mean, you're talking like expensive, meaning like probably installing a video intercom. You know, that was like a states have that. And so like it's probably like, you know, thousands of dollars.

This is not a consumer product. Correct. And so there was nothing like for me to have to do this. And I just like anything when you're naive, which naive is such a great thing sometimes, I just was like, I'll just build it. And so I just, like, sat down at the bench and got the soldering iron out and started to, like, break things open and put them together. What were you building? A camera in a compartment, like, like plastic casing that you would just... Yeah. So we had a 3D printer. We had... I took a Wi-Fi camera, like an off-the-shelf Wi-Fi camera, off-the-shelf button.

I was just, like, hacking stuff up to just try to build this. And again, it's... The funniest part is going back to that time, I had... raised a little bit of money for, it was called Edison Jr. was the lab, like my garage lab. I called it Edison Jr. You raised money and oh, the idea was anyone who put equity into Edison Jr. would get something back if Edison Jr. came up with something. Yes. And just so, so you could get a Wi-Fi camera at the time and it was relatively not that complicated to get that image on your phone. And so you kind of created a doorbell with this camera that would send a. signal to the internet and then back to my phone yeah okay and um how long how long did it take you to come up with this so i started playing around it 2011 like you know like literally just like hacking around

with it and it was basically like 2012 i had like a real working model and when i say real working model i mean it's still very very rough but like something that actually you could like see it work and kind of get an idea of what this was like i i want to kind of push back a little bit because I cannot believe that you did not think that this was going to be the product that you guys were working on. You're telling me that no part of you thought that. No. It wasn't like I hated it and thought it was something stupid. I just, I think I was so my op because it was fixing my problem.

And so the funny thing was as I'm building this doorbell because the doorbell is for my home, not for Edison Jr., in terms of my thinking at this time, that I'm fixed. fixing a problem for me. I wasn't actually, wasn't one of my ideas on a piece of paper. And so I did it on nights and weekends because I didn't want to take time as a fiduciary away from the work I was supposed to be doing in the garage for Edison Jr. So it just, that's like how little I sort of thought of the idea at the time. Yeah. Yeah. And what's totally crazy to me is that I think around the same time, you came up with like yet another idea, which was, I think it was to like launch a crowdsourcing website, like your own version of Kickstarter?

Yeah. So at the time you have Kickstarter and Indiegogo was just kind of getting going. And Kickstarter was the big one on this pre-buy, you know, crowdsource kind of thing. And Kickstarter kicked off all the hardware people at this point. So this is 2012. They wouldn't let you kickstart a hardware. product could have to be like. Yeah, they like did like all these restrictions. And so there was some things they let you do. But basically a product like this could would not have fit into their

terms of service. But they, we so again, as I'm in this inventor lab, I said, oh, wow, here's an opportunity. We should launch a Kickstarter for hardware. And I called it Christie Street, which is, so here we are. The labs called Edison Jr. that we, you know, did. Christie Street is the street that Edison's lab was on in New Jersey. And I thought Christie Street was going to be the big things. It's a platform and it's a marketplace and this whole, you know, it could be huge. And so I convinced a friend of mine who has, he had a conference in Paris called LaWeb. And I convinced him to let me launch Christie Street at LaWeb, which was like a huge thing for me to be able to get like that kind of an audience for Christie Street.

This is like the tech crunch of Europe? Yes, basically. Okay. Yep. And so on the call with him and I'm like, we're going to launch this thing and here's some ideas I have of products to put on. We need it obviously like to launch a platform like this. You need to have something on it like that people can go to. And so I, we had a bunch of ideas, Snap Garden, all these things. And I went through the list with him. And like I'd thrown on the list the doorbell. He's French guys. He's like, you know, he's like, absolutely the doorbell is like the that is the thing people will love. And I'm like, really? He's like, yeah, he's like, you have to do the doorbell. And I'm like, okay, I'll do the doorbell. Oh, you were going to launch Christy,

street announce it and then say, oh, and by the way, we've got Snap Garden and we want your, you know, but he was saying, don't, the doorbell. That's the thing that you want to get funded. Yes. All right. So you're invited to this conference in Paris. And when was the conference? December of 2012. And how many people are in the audience? It was like, I think it's like over a thousand. It was like a big conference. So you stand in front of a thousand people and you present. Christy Street.

Correct. And everything was broken the night before on the site and nothing worked and the credit card thing. I mean, you know, it was like any normal thing. Like, it was just like everything was a mess in like behind the scenes. And then we launched it like actually worked. But the launch was Christie Street. It was not the doorbell or was it was the doorbell. Well, it was Christie Street.

And oh, like our first, the first thing on Christie Street is doorbot, this Wi-Fi doorbell. So we definitely needed something that for people to go to the marketplace. And so that was like the first thing. So we threw our own product on as the first product. Got it. And you decide to call a doorbot. Yes.

When you're three guys in a garage, you call something doorbought. And my wife, when I was building this thing and putting it on and showing her, she said to me it's the best thing you've ever invented. Wow. This is Aaron, your wife, Aaron. Yeah, my wife, Aaron. And so Aaron said, like, it's the best thing you've ever invented. And at the time, I really did, I didn't like her saying that because I almost felt like it put down the other things I was doing.

You're thinking, I'm the guy who invented unsubscribe, Aaron. Yeah, and voicemail the text. And Aaron at the time was working in Hollywood, right? She was working in the entertainment industry. Still, yeah, she's a, which was, again, very fortunate. She, you know, part of how we lives was, you know, or I would say part of how we lives was on her salary. Yeah. So she definitely was, she was keeping us going.

Yeah. But, and she said because it makes me feel safer at home, it makes me feel like we have gates. So if you've now fast forward back to we're pre-selling. part of why I didn't want to put it out there and didn't think it was that big is I didn't think other people would have the same. I didn't think they'd understand how it would make them feel. And so I thought it would be very hard to market that to say, hey, it's going to make you feel safer in your home, not just be a gadget. And when we started pre-selling it, I remember there was this one woman and she said, I bought it because the neighbor's house was robbed and they rang the doorbell.

And if someone rings the doorbell now, I can answer it. And I could act like I'm home. And I was like, so if there was an aha moment in this whole thing, it was that where I was like, oh my, holy shit, the customers understand why this is important to them. That was when I was like, we can do this. Like that was really the, wow, they get it. We'll come back to this idea of the mission because I have to imagine that most people who saw the doorbot concept thought, that's so cool. I want that. Like they weren't thinking, security or it was just cool, like a video doorbell on your phone. Yeah, so I call them gadget collectors. The issue is, and I think why a lot of companies have this sort of false positive where they look

like they're going to be huge companies early on because their growth is just like astronomical. And then all of a sudden they just go to zero because you can't live on gadget collectors. You need to do something more meaningful than that because long term, the gadget collector market is just not that big. By the way, how much money were you trying to raise for DoorBot on Christy Street? I think we put 250,000 or 200,000. It was a pretty like, I mean, for the time, it was like a pretty big ask. And did you raise $250,000? We did.

And was that enough money to hire? Because I imagine you and the two college guys you hired did not have the technical know-how to actually build this or am I wrong, did you? No, it turns out you're right. We did not. And looking back, I don't understand how we ever got a product out. You know, we were so underfunded. I mean, $250,000 at the time sounded like a lot of money.

It's not going to go that far. The reality was, yeah, it wasn't even like a rounding error is, you know, so small. Right, because hardware, we had the same conversation with James Park at Fitbit. He raised $400,000 thinking that that would make Fitbit only to realize that wasn't even going to get them like the plastic band for the Fitbit. And that was the problem was like it was so easy to get into trying to build this. Kind of like all of a sudden I was all in. Like I didn't realize that I was doing it. But all of a sudden I realized like I had all of my money.

Like all of a sudden like everything was in this thing in some way. It just kept eating up cash. But it was like little chunks here and there, 10,000, 10,000. You know, just. I mean, because there's a bunch of problems to solve. It's like, okay, how do we make this? And then how do we source the materials? And then how do we get this manufactured at scale?

And I think the first and most important one is to make something that works, right? Yeah. And to make matters even worse, we decided because my house didn't have a working doorbell on it. So we decided that we were going to make a battery operated one. So it could go on any home. So you wanted to make a wireless Wi-Fi battery-operated doorbell with a camera. Yes. And working out of your garage still?

working out of the garage, yeah. And, you know, hiring consultants to do something, you know, because we had, like you said, I mean, we really did have, like, very little expertise in the things that we would need. And you would need consultants who had expertise to come on and I'm sure their hourly rate was high. And what was the, what was like the biggest challenge that you sort of faced in this first year trying to, trying to solve? Well, it would have been amazing if there was one that stuck out, you know, it was like everything was, you know, if you were a skier, It's like everything you looked at was a cliff. Like there was just no easy part of the run.

Doing audio like this was hard. The video was very hard. I never had been to China to find a manufacturer. I had to go find someone to do that. It used apps. You know, you had to have a big back-end video processing system. Like, there was each one of those in itself was a company that would have been hard to do. And so it was, we took on a task that was,

I'd say as close to impossible as you can get, I think. Did you bring in, I mean, was there a moment where you would bring in a consultant who was a specialist in one area that you needed solved? And you said, this is what we need. And the consultant said that's impossible. You just, it's not possible to do. Well, I didn't say we'd bring in. That was like you'd talk to someone who would say that and you just like hang up and then call the next one. Like you just kind of kept calling people.

Was that the standard answer that you would get? Pretty much. Yeah. I mean, most people were highly to fairly negative about the. product ever working. And there was people that like stake their reputation on saying like they will never be able to get this thing to work at scale. So, um, $250,000, you must have burned through that pretty fast, the money you raised from the, from the crowdsource. Yeah, like, yeah, I mean, it was, it was like gone in a flash. So I have to imagine you needed outside investors to

help you out. So we did. So I put, I kicked some money in, um, that I had and sort of got, again, a little over my sort of head in it. And then we raised, we started raising money in 2013. We raised a million dollars, which was one of the most difficult raises of money I've ever had to do in my life. Why was it so difficult? What were investors? I mean, so it was a lot of things. I mean, one is, it was very hard to see that a Wi-Fi doorbell was meaningful in any way. How is this going to do something that's enough to pay back a venture capitalist? Hardware is hard. you know, are you able to build this thing? I couldn't show them a working prototype because I didn't have one.

The deck was fairly stacked against us. I think the only way I raised the money was just by hustle in terms of like I think I just wore people down. And at this point, I really didn't have it. I didn't really have the option to not fight because I was so into this that if it ended, I was going to be in like serious trouble financially myself. So I was really like going and hustling and just doing it and executing. On the other side, though, at home, you know, when no one was looking, like, yeah, I was, like, crying inside.

Like, I really thought I, like, destroyed everything for this. All right. So, 2013, something else happens that year, which a lot of people listening may know or may not know, but you got on Shark Tank. Yeah. How did that happen? So I have a friend of a friend who's trying to start some sort of startup business and said, could you go out to lunch with my buddy? he's starting to start this business and would love to sort of get some feedback from you

and I'll never forget, I remember driving to this lunch being like, here I am a guy who's going bankrupt in his garage for a doorbell and I'm going to give him this rich like his family's very, very well known and I'm going to give him advice. I should be focused and I'm like thinking to myself this is why Jamie you always lose

because you can't focus. Like this is why. I remember I was like yelling at myself on the way to this lunch and I get to the lunch and the guy's super nice and talking the whole time and like all about his business. And literally like we're just done. And he said like, what are you working on?

I said, oh, this doorbell thing. And he said, you should go on Shark Tank. And here I'm thinking, it must be nice to be like wealthy because that's how you think. Like, oh, you should go on Shark Tank. I'm like, no shit I should go on Shark Tank. Like how do I get on Shark Tank? And he said, oh, a producer contacted another friend of mine. They're looking for things more like your stuff, like a product, like something more

electronic, like a little more complex this season. I'll send you the email you can email the person. Now, he didn't even know the person. I blind email that person from the table saying like, hey, here's my company, getdoorbot.com. We'd love to go on Shark Tank. And I'm driving back from the lunch. The producer calls me and said, this is the greatest thing. We got to have you on Shark Tank. And I was like, yeah. Now from that call, though, now it's like the fear of I don't want to be someone who becomes a joke. And so I took Shark Tank as seriously as any execution of any piece of our business. I built the set in my backyard. You have to build a set for like, because you like wheel out a set where you show. Okay. The funny thing is they tell you they're like, oh, we think this is

what would look cool. And I'm like, great. You just, you know, tell me and you can build it kind of thing. Like you're a show. And they're like, no, you build it. And I'm, okay. So you had to build out your own display. And what did you build a set out of just like plywood? So we're in Los Angeles, luckily. How do you build a set? Well, it turns out like you just ask someone because everyone builds sets here because that's what they do in Los Angeles. And so Dr. Wood, who is a set builder, came over and built a set. Describe what it looks like. It's just like it's a fake front of a home to put the doorbell on just to have it sort of sit there, you know, so they had something in the picture to make it look nice.

And was that, how much does that cost you? $8,000. Because you really wanted to impress him. Yeah, and I really did. I took Shark Tank seriously. Like, I mean, and when I mean seriously, I had 300 questions that I thought that they would do. I watched every single Shark Tank episode multiple times that had been on to that point. Why was it so important to you to go on Shark Tank, though?

Because at the time, the ratings on Shark Tank were massive. I mean, it's still a big show, but it was a massive show at the time. time. So look at it as a 12-minute commercial on ABC for your company. What's the value of that for a guy in a garage is infinite. It's priceless. And so I wanted to be the best Shark Tank person of all time, which I really took it seriously. I mean, I trained and I had neighbors over. Your job became Shark Tank, not. Yes. You must have been so nervous. Like, nervous doesn't even I mean, I had been, and here's the worst part. The producers forced us to do a live demo of the product. And I kept being like, hey, yeah, we'll do a live demo. I'll tape it. And then we'll run the

tape. And they're like, no, live demo. I'm like, yeah, I'll just, and like, they wanted to see it work. They wanted to see it work live. It had to be live. This is September of 2013. So we hadn't even shipped them yet. So we had four doorbots, which I think were the only four that existed in the world of that time. We brought all four. And you have a very quick transition between the last person goes. You get on. You have like 10 minutes to set up. And so we're setting up. I'm with the producers. I'm talking. They're talking to me about all this like, here I said, we want you to do this and set up for this and do all these things. And Mark is behind the house. Does your engineer, Mark? Yeah. Scurrying back and forth. And literally you can see his shirt. Every time he scurries back, he's like more sweat is on it.

And so it's like at this point, it almost looks like swimming pool like he had jumped in. And into. So I go over there, I'm like, Mark, what's going on? I'm trying to be calm because they're all looking at me. And he's like, it's not working. And I'm like, yeah, yeah, yeah, it's going to work, Mark. You get it working. And he just looks at me. I'm like, you're going to get it working. And so it turned out, like, the first three, for whatever reason, didn't work. The fourth one ends up working and then, but, but like working just for the, before we start. And you're nervous. Dying. Dying. Nervous. But you've got to be positive and, right? charismatic?

Yeah. Who's there? It's Jamie. Here to pitch? Come in. So I get out there. I do my, you know, like pitch thing, and the end of the pitch is the live demo. And I go over there and I have the phone in my hand and I press the doorbot button and I'm just waiting.

And it's like the longest, you know, three seconds or whatever it took to go in my life. Hey, good looking doorbot guy. Hey, Mark, it's your good friend, Mr. Wonderful. And the thing all of a sudden, it like comes up and the picture comes up. It's probably still the best picture we ever got out of a Dorbot in the history of Dorebought. It looked beautiful. And literally I'm just like, oh my God, it worked. It's like, it worked.

And it's like, and just, you know, made it happen. Now, two of the sharks, Mark and Lori, I think, were like, I don't get this thing. And all the sharks passed, except for Kevin O'Leary. I think the deal that Kevin O'Leary offered you, if I'm not mistaken, was he would give you a $700,000 loan. I want a 10% of royalty, and I get 5% of the company's equity today. Oh, my God, that is a horrible offer. I mean, that is an outrageous offer from Kevin O'Leary. Yeah.

And I literally was contemplating because we needed the money. You were desperate. You needed the cash. Yeah. respectfully, Mr. Wonderful, we're going to decline. Go kick some ass, Jamie. Thank you, Eric. Good luck, Jamie. But you did not take the deal.

No. Were you like, this was a disaster, or were you thinking, you know, there's a silver lining here? So you don't know when, so this is now, September of 2013 we filmed, there's no way to know when it'll air. It'll air between now, basically between the show starts on TV, which is like, I think, October or something. and like May. I knew we weren't going to make it to May at this point. You knew the business wasn't going to make it until May. Yeah, not where we were sitting.

I was thinking I just blew a month of focus on this thing that now didn't work out, and we are in a worse place than we were before. When did it air? It aired November of 2013, which, you know, think about, like, as a consumer electronics product to air right before Christmas when you're just about to start shipping, and you're just about to have all these units come in that you have, haven't figured out how to sell, you couldn't write. It was like a Cinderella story. I mean, you can't write the script better than that. So how many, I mean, you still were about to send

the orders to the people who bought it from the crowdsourcing platform. How many orders did the publicity from Shark Tank generate? It was just, it was crazy. It was actually, it didn't come in all at once, though. It was funny. The first night we did, you know, it was a hundred something, thousand, whatever it was. It was a lot. A thousand orders? Dollars. Dollars. Dollars. $100,000, okay, yeah. And so it was a lot, but it wasn't like crazy. And so then the next day I'm like, oh, wow, that was good, but it wasn't as good as I had hoped. And then the next day was like another couple $100,000.

And the next day was like $100,000. And the next day was like $100,000 because people were T-vowing or, you know, watching on demand. And so it ended up being this tail of this thing was just so long. And so we got, in the end, it was millions of dollars of sales from being on Shark Tank. And then we ended up started in December. we started shipping them out. And by the way, these were being made in China? Yes, at this time.

How did you find a factory to agree to make this? I mean, you guys were skating on thin ice financially. I mean, there was a good chance that you would not be able to pay your creditors. So, yeah, I mean, we found a factory to agree to do it through like, you know, just friend of a friend calling doing, you know, hook. and crook and just everything you could. And we were prepaying for the devices. So they would never take a risk on us. And it was the other problem is I had to order too many devices.

I had to order. My first order was 20,000 devices, which was a lot then because otherwise they wouldn't even do it. And so when they went out to customers, were people happy with them? So interesting stories. So we get them in. And the first ones, you know, we're doing. some stuff with and they're coming they're kind of trickling in this is like November of 13 and we're

we had this one programmer that we hired and he came up with hey we can make the video better if we change these variables and so he was testing that and so he sent off to the factory a new build of the software to go on the next round of doorbots to make them better and we were so behind on shipping and this is getting into the holidays and you like we were worried people were going to you know ask for refunds so we took this huge show shipment. So, you know, thousands and thousands of doorbots. And we just turned them around. We just put them in boxes and we just shipped them out that day. And this is getting right into Christmas. And we start hearing, it's like the week before Christmas, people are contact me and saying,

it's not working. It was certainly a challenge device that had a lot of like technical issues, but not working was like, it wasn't not working. And so I talked to them and I was looking at it. And their video was coming through like an old TV like tuner. Like, like it was like all like lines. through it and just you couldn't see the picture. And so I'm like, okay, let's look at it. This is now Christmas Eve Eve, so the day before Christmas Eve. And we're sitting with the engineer person and we realized that when he was testing his software, it wasn't actually writing onto the unit. So he thought he was changing stuff. He actually wasn't. So he ended up sending software to the factory that was basically just like garble. So we now had basically

the large, like most of our units are now in the field with customers that not only do they not work, but we can't change that software on them. So they're basically bricks. You cannot fix the ones that people have. So it turned out, and we learned this on Christmas Eve Eve, that you can't rewrite the software on this chip. It just doesn't, like the chip only takes it once at the factory and then it never allows it to be rewritten again. You cannot update it wirelessly or anything. not even physically. So they were literally bricks. And so this was like the end of the world.

Like this really was. And, you know, so when something real happens, I'm almost like a pilot. I go through my checklist. Like I actually go super calm. And so I literally like go to the calmest place like probably in my life, get everyone together. And I'm just going through the checklist. Like, can it do this?

Can it do this? Can it do this? And like every answer is no. So I go home. And I'm like, it's amazing because like basically the business is over, but I'm calm, and I talked to Aaron, and I said, yeah, like, the, the, you know, like, it's, it's done. And she's like, it's not done, you know, like, and Aaron's always been amazing. Like, you know, like, we'll make it through it. I'm like, no, it's done. Like, we sent out

everything with software on it that doesn't work. By the way, how many did you send out? I think it was, like, it was over 5,000. So the shipping alone, just to bring them back would have been devastating. And by the way, we would have really had to, like, the, the, the, if you go to the pilot check is you'd have to throw them out, make another batch of this amount, which by the way, we couldn't make. We didn't have the parts. We didn't have the money. And send those back out to people or refund them all their money, which I didn't have that either. And so I like, I'll never forget it.

Like my wife, you said, well, why don't we just mortgage the house? And it was like, because it's fucking, it's like you're heading into like the worst storm ever in a boat. You know, it's like you're going to sink. And she's like, let's mortgage the house. Let's go into the storm. And it's like, you can't. Like, there's no, like, we're done. When we come back in just a moment, how Jamie came up with a desperate, last-minute idea to fix those doorbots

and how the real work of Ring was just beginning. Stay with us. I'm Guy Raz. And you're listening to how I built this from NPR. And one more thing before we get back into the story, just want to mention that in this part of the show, you'll hear me talking with Jamie about the possible unintended consequences of Ring and Ring's mission to make neighborhoods safer. And just a heads up that we did this interview back in late April. So if you're wondering why my questions don't mention anything about the mass demonstrations we've been seeing around the U.S.

and the world, that's the reason. Okay, back to the show. Hey, welcome back to how I built this from NPR. So it's 2013 and Jamie's sent thousands of non-working doorbots to thousands of customers, and his company has no money to issue refunds. And one more thing, it's two days before Christmas. So yeah, like, that was Christmas Eve. And so we got to dinner, and it's like, it's like as upset as I am, I can't, like, there's nothing to do. I'm yelling's not going to help, so I'm just kind of like calm.

And we're at dinner. And all of a sudden, I'm like, you know what? We changed the backend server a couple weeks ago. go to a cheaper one because for processing the video in the cloud. And it was just cheaper because we only needed to do one thing. And the other server used to do like a million things and it was expensive. And I'm like, I wonder if that other server would actually be able to process whatever the hell we're sending just because it just has like better sort of capabilities to it.

This is while you're at dinner. Yeah. Yeah. You're just like racking your brain. Yeah. And so I call Mark and I said, who is like our engineer and kind of like my, my, my engineering partner in this. And I said, Mark, what do you think?

And he's like, hey, listen, it's worth a try. Yeah. And so to do this took a while, though. Like, you couldn't just like, oh, I flipped the switch. Yeah, it works. And so Mark works all night long. And like 6.30 a.m. I get a call on my cell phone.

You know, it's ringing. It's Mark. I pick it up. And he's like, dude, you won't believe this. It literally works. And it's the best picture we've ever had. I'm like, no way. It was just swapping out a better server.

Yep. It literally worked. And I mean, like, that was, uh, yeah, that was. And so like, oh my God. I still say it's best Christmas we've ever had as a family. I mean, it's, it's amazing, right? I mean, what happens? Do you, do you send a blast out to the customers and say, okay, now retry it? Yeah, it was like, hey, if you, if you might have had an issue, we made some updates and you should be fine now. Like, you know, like, just, if it was just yours that you had an issue on, because maybe someone had a problem, like, try this. even though everybody did. And everyone's like, hey, it works. It's great. Like, thank you so much. Okay, sure.

You know, of course it works. Like, why wouldn't it? Like, Merry Christmas. Oh, my God. But I have to imagine at this point, you're like, we are never going to put ourselves in a situation where we cannot update the chip ever again. That, yeah. No, that was definitely a tenant that we realized.

And again, we just didn't realize we had even built it like that because we were so naive and young and trying and hacking this thing together. We literally just kind of didn't understand that's what we were doing. I mean, I'm assuming now 2014, you enter 2014, like, good to go, right? You got the lifeline, you got the money, and now it sounds like you're in great shape. So again, to the living and fear thing. So, I mean, definitely we are in better shape than we were before, that's for sure. Like we had orders coming in, money coming in.

But we had this other problem now, which is everyone just saw this product. and we were like a rag tag group building this thing with a rag tag product. And now my fear is I am going to be a bartender in five years. And someone's going to say to me, oh, have you ever done whatever? I'm going to say, oh, I actually was the one who invented the video doorbell. And they're going to say, no way. That's Frank Jones or Jenny, whatever. And she's a billionaire.

And I'm going to be like, I know, I invented it. They took the idea and actually did it right. And so that was like my. That was your fear. Yes. Because you had shown the proof of concept on Shark Tank, and clearly there was interest. And clearly, if an enterprising company, like an alarm system company or somebody saw this, somebody in their business development team or whatever product development team was like, hey, look at this thing. We should do something like this.

Yeah. Like we're going to copy this. We're going to build this. We have hundreds of engineers. We have endless resources. Yeah. Yes. Like literally really my fear.

Like I really felt that in my bones that I was going to be a person who invented this and didn't actually make it with it. And so between Christmas and New Year's, I get everyone together and I said, we've shown what's going to be out there. And if we don't rebuild everything, like the name, the back end, the product, if we don't really sort of show what this thing can really do and we don't, and it's not us doing that. and we don't launch it by next year's holidays. So by the holidays of 2014, someone else is going to take this slot and we're done. And I called the effort. I called it F5,

which stood for effing five-star reviews, meaning that you needed a true 360 five-star reviewed product, which meant the customer service had to be five-star, the brand had to be five-star, the packaging had to be five-star, the product had to be, like, everything about, it had to be five star.

And how did you come, by the way, how did the name ring come about? Because you're Doorbot in 2014. So I go to one of our investors with this F5 thing who had already invested in Doorbot. And I said, listen, here's what we're thinking. Here's F5. I just want to like pass this by you because I'm going to need to raise some money. So I just want to do like an early look. Just sit with me and let me pitch it.

So I pitched the whole thing. And the last slide was, I need a new name. And every slide before that I'd said, the ring of security around your home, the ring of this, the ring. literally I kept saying ring. I didn't kind of realize it, but I kept saying it. And so literally just blurts out and said, just call it ring. You keep saying ring. I was like, yeah, maybe. And I kept thinking about it. And then he emails me that night and he said the domain name is for sale. And I had always wanted to have a company with a four letter domain name. Like I'm not a

person who likes vanity, but man, did I want a four letter domain company? Like eBay, you know, or half.com or like, you know, Nest or like there's so many. And so when he said that, I'm like, I need to buy this domain and change the company to bring. And presumably, and also I should mention by this point, you have an office. You're out of your garage. You're working out. You're working out of a space in Santa Monica. Yeah.

And we were like now 40 engineers or something. So we were like, we were going for it. And so, and this is really your year, right? like that Christmas, the Christmas sales for that year, the fall of 2014, this is really when you want to kind of push this out. So as you were pivoting from doorbot to ring, did you like completely reinvent it? Did you make it better that year? Everything was from scratch. So new Wi-Fi, new camera module, motion detection we put on it that never had been there before.

We did infrared night vision, two-way bi-directional talk. so it was more like a phone conversation and pushed to talk. I mean, it was just like we literally like everything was redesigned on that. Everything was redesigned on the brand. You know, we literally ring. So just every piece of the business from like soup to nuts was redesigned and rebuilt from scratch between January of 14 and October. And things like like design, right?

Like design was going to be important. Like one of the things that happens when you get a ring. And I think, and I don't know if you introduced it as early as 2014, was it came with a screwdriver, a little screwdriver and like a leveler. Yep. Because a lot of people just, you know, don't have, was that. Yeah, my thing was always that I don't, if someone has to drive to a hardware store when they get something, it's just such a bummer. It, like, just bums you out. And so I want everything in there.

In fact, the first rings that shipped had a canvas toolkit in them. And it rolled out. And every single thing was in the canvas toolkit. And so it was like this beautiful, like, I mean, way too expensive and we couldn't keep doing it. But it was like this beautiful canvas toolkit. It was amazing. How did you do in 2014? How were sales?

2014 was, I think, $3 million in sales. It ended up working out that the tail of Shark Tank sort of credibility and awareness got us through selling the doorbots without having to do much marketing and allowed us to sort of focus on then getting ring up and running. So my job mid-2014 was to go raise money because that we needed and sort of get us to launch sort of, let's call it, into 15. And how was that when you went back to raise money? Was it a little bit easier? No, no.

I basically went to these venture capitalists and I talked about the mission, you know, we're going to make neighbors safer. We're going to do this. And so like most of them just, I mean, they literally didn't even say no. They just didn't even like they would just like threw us out. Like it wasn't even like, I wish it was like a no. it was almost like not even a chance. And there was one venture capital firm in Silicon Valley that was just like super missionary focus. And I didn't really even realize how missionary focus they were.

And when I said that, it just like kind of sparked the partner there. And they were so intrigued by that that they basically invested. But I'll never forget, like being in that VC meeting when I said, you know, we need, you know, 4.7 million. And the partner on the other side said, you know, there's no way you're getting that out with $4.7 million more. You're going to need a lot. A lot. more. And I said, you want to bet? And he said, yeah. I said, well, great, give me $4.7 million. I'll show you can get it out. Like, I think he was literally like, okay, you know what, for that much, like I got to take the bet. And so it was, we were, we were tight. We launched Ring in October of 2014, like, you know, basically October 1st, 2014, and we were $0.00 in the bank account

the day we launched. And how much was the cost of the Ring Doorbell at that point? Was it $200? The Ring, yeah, at that point was $200. It was like $19. Right, I think still, yeah. And that, and through sales in 2015, I can't imagine you were profitable, even a $200 price point. So we were not. So the rings were very expensive, the first ones that came in, most of the ones that we sold, we were losing some money on. So, yeah, it was a tough, we kind of were, I had felt, you know, at this point, like, we were all in. Like, I've always said to the team, I'd rather be a giant hole in the ground. So I look at, like, Santa Monica's where our office.

So I always say, like, I'd rather there be a giant hole in Santa Monica than to kind of whimper our way out of business. Like, so if we're going to go for it, let's go for it. So there's a quote of yours that I read. Basically, you said there were nights when I would wake up at 3 a.m. in tears bawling. How are we going to make it to tomorrow? You've got traction. You're selling product. You've got investors on board.

It's 2015. There's more visibility. The product's getting better. and you're still panicking about its survival? I mean, I still panic today. I just always was worried. There's so many things to worry about in business, including what you don't know.

And so I am always kind of panicked. You know, fear drives me. And, you know, now I'd say it's a digestible fear. Back then, it was really, I had everything in this thing. And if it went away, you know, maybe now at this point I would not have, like, gone literally bankrupt, But it just, I mean, such a giant thing that I had built would have been just, you know, wiped out. I'd have nothing.

And I could keep seeing how we could go to nothing. Like, I just was, I was terrified. I mean, competitors, terrified of what I didn't know, like, what was the person going to build that was going to wipe us out that I couldn't see? Terrified of ourselves. You know, I always say, like, the thing that I believe puts companies out of business is yourself. You know, it's us not providing to the customer in a way and not. building that relationship that's going to, you know, so it's, you got to keep, you know, keep pushing things. And I said, if we keep going the way we're going, I think we're going

to get, you know, trampled. We need to take this thing to the next level. You thought you'd get trampled by some big technology company. You'd been trampled before. Google trampled your voice transcription service. They unsubscribe. I mean, you knew what meant to get eaten alive by a bigger, better resource company? I certainly knew what trampling felt like. And I also, I had this concept and it actually comes from my mentor who I've never met and who has no idea that I exist, James Dyson. He's been on a show.

It's an amazing story. He, I always thought, you know, in the future, we're going to keep getting competition because that's the way of life and that's fine. I need it to be that when someone sees ring, they know that it stands for something else, that it's about neighborhood safety. And we always said, we have to be rewarded with the purchase of our neighbor, which is what we call our customers. And so the way that Dyson did that was they put James Dyson in commercials and he talked to you and said how he was an inventor. And so that's kind of where a lot of our stuff came from. It's like, let me just go out there and tell people what we're doing.

and the message, and let's get it out there so that we can build this brand because that's defensible long term. Like, when you build a, you know, Dyson, anything they come out with, you know is designed better than everyone else's and has been thought through better. And that's what we had to be

for neighborhood security was my feeling. And I think we've actually maybe now achieved that. I'm wondering, what were alarm companies thinking? What were they thinking? I mean, Ring was getting traction in 2014, 2015, 2016. Why didn't they, what do you think? Like, why didn't they just copy this idea and make it?

I mean, so it's interesting. I went to one of the big security companies and talked to the CEOs, and I think they just, they were in sort of a different business than we were, I think, which was, I was in a business of trying to invent around this mission

of making neighborhoods safer and really innovate around that. And they were in the business of trying to capture customers, like reduce shrinkage, like, very like MBA type talk. Like you need to have like, you know, what's your ROI? What's your this? Like they were running a business. And I was running an innovation lab around making neighborhoods safer. And so I'll say we got kind of lucky because, yeah, I mean, trust me, if one of the, if someone that big had come out with something

much earlier, could they have unseated us? Probably. So I want to ask you about something that is controversial, a controversial part of your growth, which has been partnering up with law enforcement agencies. And I can understand how a lot of people, especially, you know, privacy advocates, get freaked out because when someone passes by your house, right, you get filmed. If someone rings your doorbell, you get filmed. So let me, I mean, just want to ask you about the law enforcement part, right? When you, when you decide to partner with law enforcement agencies, did a part of you ever think, hey, you know, this could be troubling, right? Like, there could be things like racial profiling and other things that you might not have thought

through. So the term, I mean, there's been a lot of press around this. Sure. And so, you know, we missionary company make neighborhoods safer. And so I'm an inventor. I go out there and I look at, what services, what products can I build to make neighborhood safer? That's my goal. And I looked at a current thing that was happening in the world where when something happens in a neighborhood, a crime happens in a neighborhood, a police officer has to go door to door, you know, to ask for video, ask what's going on. It's very time intensive on their part. It's also very nerve-wracking to the person who is on the other side of that. A police officer is literally on the other side of your door you open it up and they ask you, you know, hey, you know, do you have this? Do you have this? And so that's, that's not, you know, for both sides, it's not good. And I said, I can build a better system for this. For the neighbors, what's better is we have a system where police, you know, law enforcement or also fire departments now use it can ask for information. You know, it basically goes out as an alert. And you can respond to that alert. And if you respond, then obviously they'll get your video that you're, you know, saying, you know, you know,

yes, I want to give you this of this time. They don't have access after that. They don't have access before that. And if you say no, they don't actually see that you said no. So you don't have that. If you didn't want to give a police officer video who's standing in front of you in your door, that's a very uncomfortable situation. We actually made it better. So we actually made it more privacy centric, which goes to our privacy security and control are sort of the foundational elements we always say at ring. And so I think we've actually invented a system that's way better, each person owns their data. And that's so important to us. So it's the idea that every single person owns their data. And then when something happens, you can come together.

You can make that choice to share at that point. You have the, again, security, privacy, and control are foundational to everything we do. Do you have no access to my video stream at all? Absolutely not. There's no, there must be, they must be stored somewhere, though. They're stored, but we, I mean, we for sure on purpose do not have access to those because, I mean, yeah, no, it's your data and we want your security, privacy, and control to be there. I guess, Jamie, the thing that I'm sort of hoping to crunch on, right, is the idea of unintended consequences. Like, there's no question that the benefits of Ring are huge. But, like, the benefits of Airbnb are huge. I've been able to stay in place all over the world, but it's also, like, effective.

property values in places like particularly San Francisco and New York or London where there are just empty homes ring this amazing product. But there are also things about it that let's be honest, are going to be beyond your control. And so I just kind of think that it's important that everyone, inventors, technology people, just acknowledge that possibility. I think these are important discussions that should be had and constantly had. Just like I said, I always live in fear. Like I always wake up every morning thinking something could have taken us out. Like whatever that is. Like we should always be looking at this, always scrutinizing ourselves, always taking the scrutiny that comes and looking at it and making sure that, you know,

we build features and products that truly make people's lives better. So that's, it has been powerful. And we've seen the anecdotes of that of even like lost pets and, you know, a person who goes missing and, you know, in the neighborhood. We had an elderly person who went missing in their neighborhood. They were like Alzheimer's or something like that. And so we were using the neighbors app, they were able to sort of people were able to track down and find this person. So I think there's just a lot of great things. It's not just about, when I say like safer neighbors, I don't mean just, you know, crime safety. There's lots of things. I think that's something we should do every day. And I agree. Every person who is in a leadership position,

government, companies, whatever that is, if you have the ability to do something that's large, you need to continually scrutinize and think and discuss and look at this to make sure that the unintended consequences aren't happening. All right. So in 2016, Amazon makes a strategic investment in ring. And then about a year later, I guess somebody sort of like signaled to you that maybe they were interested in acquiring you? So we're working with them.

We're doing all sorts of projects with them, all the stuff. I just kind of keep the relationship going and it was good. But I always laughed with them and said, if there's any company I'm going to sell to, it's you. And I had meant it in a not like trying to like bait them, but in a real way of Amazon was the only large company that I saw or felt when they bought companies truly like brought it to the next level. Like I, you know, with audible and IMDB.

and Zappos and I mean you look at Twitch like you look at all they they've just kept founders and just done I really have felt they've done such a great job and so I was a joke with them about that and so Nick Camoros who's one of their head of corp dev people said you know hey I'm going to be in LA let's have some lunch and it's like sure and it was not that out of line because we had been doing a lot of stuff with them and I go to lunch with him and he says to me you know I think it's time we go to the next level and I'm like it was like this weird dating thing where it's like, so are you saying you want to go out? Like, because it was, I didn't want to jump in and be like, yes, we're going to, you know,

like, let's do it. And so, um, so it ended up be like, it was kind of this awkward sort of a couple minutes of back and forth to like make sure that he was saying, yes, we want to buy you. And so that I could then say, yes, I'd want to sell to you. And that was in, uh, like September, October of 17. They offered a billion dollars for ring, which, um, I'm, I mean, that was a huge return for your investors and all those people who put money into Edison Labs, a lot of people got rich off that acquisition, I have to imagine.

I mean, yeah, but we distributed a lot of money. Wow. Yeah. When that deal came through that a lot of the articles about it were, he went on Shark Tank, no one invested, they were all dummies. That was basically the story that all these Shark Tank people could have made all this money off of Ring. I mean, sure you saw those articles.

did a party you think that too? I mean, you know, Shark Tank, I mean, Shark Tank's a TV show, and I think it's an amazing TV show that does, I think great things for kids to inspire them to build and do things. But, you know, it is a TV show. It does have to entertain. To be fair to the investors, they get up to an hour with someone that they've never met before, you know,

and they had done so much for us that, yeah, I didn't have any bad feelings about it. I am really proud to have built the largest company ever to appear on Shark Tank. I mean, that's something that, you know, certainly, like, I really do get a lot of pride out of that. And then I was invited and I went back on for a few shows as a shark. And so I was the first person ever to sort of be, you know, on the show as an entrepreneur and then go as a shark. And again, that was like really, we have a thing in our culture where we don't celebrate at Ring. It's like one of our cultural sort of bullet points.

You don't celebrate victories or wins. because there's always something next that we have to do, which is fine, because I like the idea that we'll sort of always just keep progressing and doing better. And so to that point, like even with Shark Tank, like, it may be hard not to celebrate the fact that happening personally was pretty interesting. All right. So you now are an Amazon employee, basically. It's like Zappos, right? You have your own company, but you're part of Amazon. Yeah.

And you have all this support on Amazon resources and their distribution system. And it's one of the biggest companies in the world. Now do you feel like you can kind of take a breath and say, all right, we're not going to get crushed because we're with Amazon. It's like being on the Chicago Bulls in the 90s. So it's been a really interesting. I mean, I've always said that money didn't drive me. Like I always, you know, have said that. But I think until you have money, it's hard to be sure that that's the.

case, I am just as passionate and, you know, sort of angry when something doesn't happen that's right. My email's still on every box. I still respond to them. I'm still just as upset when we do something that's not as good as we should. So like all of that's the same. The difference though is now before if Ring, if something really had happened to the company, I would lose everything and truly like impact my family's life. At this point, that's off the table. And so it is, I do, it's amazing every day. I'm still almost like I have it's the I feel the same like I don't even feel like we sold it. I feel like it's just we're there to keep you know fighting the fight and doing what we're doing and it's like and I love that. You are in your early 40s? Yep, 43. Your hero James Dyson when

he was your age was broke. He'd done the ballbarrow and a bunch of other things and he put all of his money into building the Dyson vacuum cleaner and then within two years after he launched it was the best selling vacuum cleaner in Britain. And we need to be. know the story. He's now one of the wealthiest people in the UK and the world. Do you think that, you know, your story and what happened with this, the ring and shark tank, everything, do you think it has more to do with just your intelligence and your skill? Or do you think that luck was a bigger factor in everything that's happened to you? So the thing I always say about luck, I think it is, it's the lottery. And so you get sort of lottery tickets for how, you know,

it's like how good your idea is, how good your team is, and how hard you work. And so you take those factors. And I think how hard you work in your team are probably even bigger factors than the idea, but you still need to have something that actually would work. And so you take those three things together and you get for each sort of hour of production or work, you get a lottery ticket. And so just like the lottery, unless you own every ticket, you're not guaranteed to win because I've seen people that have, are smarter than me, better than me, better idea than me fail. because of things like luck, like things not going their way. And I've seen, again, the opposite of that.

And so we have been fortunate to have been, have lots of lucky breaks in our direction, but we also continued to work to get more tickets so that we could win the lottery. That's Jamie Simenov, founder of Ring. Since the pandemic began, Ring has donated hundreds of its products to hospitals across the U.S. so that health workers can communicate with their patients remotely. By the way, remember when Jamie said his email address is still on every box? He's not joking. It is. And if you agree with me that Snap Garden, those floor tiles that grow tomatoes and cucumbers,

is a product that the world really needs right now, send them an email. Tell him I sent you. And thanks so much for listening to the show this week. You can subscribe wherever you get your podcasts. You can also write to us at hibt at npr.org. and if you want to tweet at us, it's at How I Built This or at Guy Raz. This episode was produced by J.C. Howard with music composed by Rumtin Arablui. Thanks also to Candice Lim, Daryth Gales, Julia Carney, Neva Grant, and Jeff Rogers.

I'm Guy Raz, and you've been listening to How I Built This.