We bootstrapped CB Insights by first building a different business involving hedge funds, too big to fail banks, and $100,000 PDFs.

Data and information services nerds might enjoy this.

Backstory
▪ My first day of freedom from big company employment: Jan 1, 2008.
▪ Bad timing: The Great Financial Crisis was about to hit, but I had no idea
▪ Initial idea: Consulting based on my book on “Corporate Portfolio Management”
▪ Had $1M+ of consulting gigs lined up, but then the market tanked
▪ Our main client was a too-big-to-fail bank

Crisis Hits
▪ Consulting gigs vanished; no revenue
▪ Paying the founding team from my savings and just got married. Wifey and I watching savings decline every 2 weeks. Not ideal.
▪ Team of three, all ex-American Express, brainstormed on what to do next

Credit Cards…Here We Come
▪ Dom, a member of our trio, was a credit card financial metrics savant. He is smart, personable and knows card isht cold
▪ We knew key industry players and started calling them monthly for insights.
▪ We asked about charge volume, loss rates, and delinquencies

Creating Value
▪ Packaged insights into a sentiment report, shared for free with participants
▪ The report was popular; it gave execs we surveyed a sense for the market during chaotic times

Monetizing Insights
▪ Started consulting calls on expert networks like GLG and Coleman to make some money
▪ It helped but wasn’t enough to cover costs; I was still bleeding cash

Selling the Survey
▪ Tried selling the survey data via expert networks but it wasn’t their business
▪ But they taught us about something called prime brokers and soft dollar expenses
▪ My layperson understanding was that prime brokers bundled services, including research, for hedge funds in exchange for the funds trading through them

Nick the Game-Changer
▪ Met Nick from a prime broker who saw gold in our survey
▪ Credit cards were the next big thing folks were worried about now that mortgage issues had been understood
▪ And we were the only game in town
▪ His firm would help sell the Survey but he said our pricing was f’d

Pricing Strategy
▪ We thought $2500 per PDF was an isht ton; Nick disagreed
▪ New pricing tiers: $12k, $50k, $100k…$100k to me was insane. So was $50k
▪ Here’s how it worked: $12k for the monthly survey (7 days later), $50k for day 1 access and team calls, $100k for real-time calls on dramatic shifts

Success
▪ Nobody bought the $100k deal, but it was a great price anchor
▪ Hedge funds valued proprietary insights; $50k was worthwhile for early access
▪ Nick’s firm sold the heck out of it

Short Shelf Life
▪ Product demand lasted about 13 months; it was high only when markets were chaotic
▪ We tried direct sales to hedge funds but had zero success. Think I spammed every person at Wharton who worked in a HF

Enough runway
▪ It gave us enough cash to build ChubbyBrain
▪ ChubbyBrain’s vision was to be a Yelp for Startups 😂
▪ Pivoted to CB Insights; hence the CB

Conclusion
▪ Somehow, like a cockroach, we didn’t die
▪ Our 1st logo is below 🚀