Startup Story: Charlie Kindel on Leaving MSFT, Rolling Out MileLogr

3/19/13Follow @curtwoodward

When Charlie Kindel left Microsoft in August 2011, he did what plenty of critics say is too rare for refugees from Redmond: He started his own technology company.

In a 21-year career at Microsoft (NASDAQ: MSFT), Kindel had plenty of experience building digital products and services, including Internet Explorer 3.0, Windows Media Center, Windows Home Server, and Windows Phone 7.

Getting those projects to succeed certainly took skill, vision, and a healthy dose of gumption. But doing it outside the walls of an industry titan with billions of dollars in profits is another thing altogether.

“For me, it’s about proving to myself that I can do these things without the huge organization as a backstop,” Kindel says.

Today, Kindel and co-founder Stefan Negritoiu are running MileLogr. It’s an online application that plugs into digital calendars to figure out how many work-related miles have been racked up on a user’s personal car, to help make it easier for people to track work expenses.

MileLogr has already landed some paying customers, and if it’s successful, there could be plenty more opportunities ahead for the parent company, called BizLogr. Before they get there, I called Kindel up to hear about the experience so far as a newbie entrepreneur. Here’s what he told me:

Kindel

“When I did startups at Microsoft, I had to go and beat down the bushes for VC within Microsoft, and I had to go through all the gates. In many ways, there are parallels within parts of Microsoft or a big company for how you do that. But once I got started and I got that first little bit of funding and I was able to hire someone … well, that person came with a desk and a healthcare plan and a phone on their desk and a computer.

When you’re doing a startup, you don’t get any of those things. And actually, you can’t even pay someone a salary, which is even further away. So knowing that was the case, but not having actually done it, meant a lot to me.

It was a merit badge, if you will, that I wanted to earn. You don’t earn the merit badge by reading books about how to do something. You earn merit badges by actually doing them and demonstrating you can do them.”

“On one dimension, it’s so much smaller. At Microsoft, it isn’t even considered a business unless it’s got a clear pathway to being a $1 billion business. The product that I built at Microsoft that I’m the most personally proud of (Windows Home Server) ended up being a $30 million a year business.

I was this total unicorn at Microsoft for having pulled that off. And it was wildly successful after three years—if it would have been anywhere but within Microsoft. But at $30 million, you know, it’s just mouse ears.

While there’s great ambition around the underlying business that we can build over time, MileLogr is still at a much smaller scale than most Microsoft business problems.”

“The startup that I was running before I began focusing on MileLogr … we did believe we were going after an exit, and it was a very bodacious thing. [Editor’s note: This startup was an outdoor advertising business focused on youth sports.]

The merit badge I got through that was the merit badge of a failed startup. Which is valuable and thrilling and frustrating, but a very different merit badge.

For someone coming out of Microsoft, who’d been at Microsoft for 21 years, I think it’s pretty valuable to have. So I’m sort of proud of it in a weird way.

We actually built the technology. I had a VP of engineering, I was CTO. My CEO was drumming up money and we just … it was a very capital-intensive initiative to get started the way that we wanted to do it. I think that was one of the mistakes we made.

We simply got to the altar with funding multiple times and just couldn’t get the final deal signed. The money never showed up in the bank.”

“My mom died about this time last year. We went through her storage unit and there was a big box that was full of her old tax returns. And right next to it was a box that was full of her old calendars. And she kept those because they were records of what she had done.

You take that—OK, calendars can go back in time, they can provide you with valuable information about what’s come before. You add to that this other thing that I learned as I was building the prototype, which is all of these calendar systems talk a different protocol.

There’s no standardization for how you access someone’s online digital calendar. Exchange does it one way, Google does it a different way. Yahoo and Apple share the same fundamental protocol, but there are still differences. And Outlook.com does it even differently.

I went looking for some open-source or some library that would simplify this. And I couldn’t find anything. No one had built the abstraction layer that abstracted away access to all of these calendars. And in fact, most of the people building calendar integration solutions were doing it purely on the client.

So one of the things that we ended up building as part of MileLogr is the technology stack that allows you to have a single piece of code that can access any calendar, no matter what provider it’s on. We think that’s a core asset that we built that’s very interesting, and we are continuing to invest in that.”

“One of our principles from the early stages was get it bootstrapped—don’t spend any money. See how far you can go without spending any money. And immediately, you run into conflicts with that.

As I started doing the first prototype and really thinking deeply about the problem, I realized there was some fairly deep intellectual property involved and I had several very strong, in my opinion, patentable ideas. You can’t really do patents for free. You’ve got to spend money if you want to file patents. And you’re talking generally, to get them filed, probably $10,000-plus a patent.

I was running another kind of thought experiment as I did this whole thing, which was: How much can you get done based on barter?’ I’m a firm believer that there’s an ability to exchange value between professionals without it always being monetary.

In the patent case, it turns out I had a friend—an ex-Microsoft IP lawyer who’s out on his own, has been for quite a while. We had coffee together and I kind of brought this topic up, and he sounded sort of interested in it and he wanted to work with me.

He was looking to try and find a bigger role somewhere, and so we kind of bartered. I said, `Listen, I’ll use my network and I’ll hook you up, and you do the IP work for me in exchange.’ And as a result of that I ended up having to pay the patent filing fees, but I didn’t have to pay the money you typically spend on a lawyer to get the patents written.”

“Something that I think I knew intellectually, and I’ve always known, was you’ve got to build something quickly and get it in front of users. I know that. I know that! I tell that to people all the time.

But in this case, because I had built this myself, I’d built the prototype myself and it was going to go out there and be publicly in front of other people, I fell into the trap of `It’s not quite good enough yet.’ I was surprised by how I was blinded by that.

And so last spring, we had a (minimum viable product) that we could have shipped. And we could have put it front of users and learned a whole bunch of stuff that would have changed our direction in really substantial ways and made the overall effort more productive.”

“We’ve built only a fraction of what our dream is. And we have moments of doubt; we have moments of elation. When you have put something out there and you get a New York Times article written about it, you’re fantasizing about how many users are coming and seeing that and going right to your site and converting to paid customers.

And it’s a little bit of a cold wake-up call when you actually look at not only the amount of total traffic generated from something like that, but the conversions. You’re reminded again that stuff very rarely sells itself. Stuff is sold to people.

I joke about this a lot: Ideas are worthless, execution is everything, but getting people to pay for something is more everything.

This is just a perfect example of that. It’s much harder than most entrepreneurs think it is. And the more time and energy you can put in up front to truly understand how you’re going to sell something, the better. It’s not business model, it’s how you’re going to sell it.”

Curt Woodward is a senior editor for Xconomy based in Boston. Email: cwoodward@xconomy.com Follow @curtwoodward

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