Steven Cox – Founder of TakeLessons
If you write it, it will come. Steven Cox first harnessed the power of manifesting his destiny through pen and paper to lose 55 lbs and date the homecoming queen in highschool. Writing down his goals has led Steven to some incredible places. Most recently to Hollywood where he’s made the leap from successful entrepreneur to aspiring actor after the company he founded, TakeLessons, was acquired by Microsoft in 2021.
In his conversation with Ryan, we’ll learn how a worn out cassette tape of Brian Tracy laid a foundation for understating the importance of mentorship in Steven’s life. He also tells the story of how TakeLessons humble beginnings were inspired by a former bandmate’s struggle to make it as a professional drummer…and stay tuned until the end to hear where that drummer is now!
Ryan Berman 0:00
This is a show about facing fear, unlocking courage, and taking action.
Speaker 2 (Female) 0:05
Courage isn't necessarily a daunting thing.
Speaker 3 (Male) 0:07
It's going to give you more purpose, it's going to give you more drive.
Speaker 4 (Male) 0:10
It feels like making a courageous decision is going to get you closer to who you aspire to be.
Ryan Berman 0:14
It’s knowledge, plus faith, plus action equals courage.
Steven Cox 0:18
It's not enough for financial goals if your family life sucks, it's not enough to have great family life if your health sucks, and it's not enough to have great health if you treat everyone else terrible. To me, it's how do I become an overall holistic person that adds value to other people's lives.
(Intro Music 0:34-0:45)
Ryan Berman 0:45
I haven't met too many people who have turned from entrepreneur to actorpreneur, and my guest today is probably the only one that I've interacted with that I've seen really make that leap. Look, the show, which is about following your heart, and even when it's hard, even when you're afraid, it’s about taking those leaps. I'm joined by Steven Cox today who is doing some pretty amazing things. First of all, does it feel courageous? Because, in some ways it's like, okay, there's money in the bank now, so some risk is mitigated because of... Let's back up. Today I'm introducing Steven Cox, who was the founder and CEO of TakeLessons. Do you call it TakeLessons?
Steven Cox 1:45
Ryan Berman 1:46
Okay, which was sold to Microsoft. Congratulations, by the way, what a journey that was.
Steven Cox 1:53
Thank you. Thank you.
Ryan Berman 1:55
Why don't we go back first and do that? How does a kid go from...? Did you grow up in Kentucky or did you go to school in Kentucky?
Steven Cox 2:06
Yeah, I grew up in Ohio, so Midwest guy and ended up in school in Kentucky, and then, at some point then I ventured out west.
Ryan Berman 2:16
Did you just always have that in you where you're just, “Life is an adventure and off you go,” or how did you get West?
Steven Cox 2:24
Yeah, great question. So, there's an old saying that I learned and that is, what the child does not have becomes the obsession as the adult. It's a lot of psychology to unpack there. I grew up in a town called Dayton, it's a little midsize town directly in the Bible Belt. My dad was a Pentecostal preacher and mom was a homemaker and played the organ at church. Ryan, we grew up really, really poor. And some people talk about making it in welfare. I distinctly remember driving to the government centers and picking up the five-pound blocks of government cheese in the white and black, those kind of Velveeta sort of tasting but a lot worse, and that's how we grew up. I remember one distinct day, it was in the middle of winter, and it snows in Ohio unlike out here on the West Coast, but it was freezing cold, probably somewhere close to zero. We were sitting at the dining room table, and my mom asked me to run out to get the mail, and so I did. So, I [Inaudible 3:45] outside, and swung open the door, came back in and grabbed the mail, and it’s just freezing outside. It was February, or something. I probably was 11, somewhere around 11 or 12. And I gave the mail to my mom, and we were all sitting around there. It's mom and dad, and we had four kids. And she opened the Dayton Power & Light bill, and just opened it, read it, looked at it, and then, just burst into tears. I just remember hearing her say, “I have no idea how we're going to pay this, I don't know how we're going to pay this.” There was just almost this exasperated, exhaustive, overwhelming feeling that I saw my mom go through. I remember that day because there was something inside of me that clicked, and I said, “I will never be in a situation where I'm putting my family through this.” So, I guess the lack of financial wherewithal drove me to try to figure out how to not repeat that sort of pattern in my own life. So, some people, I remember even through college, and then, I would try to start businesses. And I remember I sold, when disk drives came out, like the five-and-a-half inch floppy. I'm a little older, they came out. So, college students needed these, so I figured out a way that I could buy those in bulk, and then, sell them on college campuses and basically make a buck or two and try to pay for my school, but it was always those sorts of things. I needed a place to live, so I basically convinced this gentleman who owned real estate to let me take over three mobile homes, and I could rent out two and just live in one for free, and because I didn't have any money, so it was almost like a forced sort of thing. Ryan, you talk a lot about courage, part of my courage came from, basically, not having another alternative. So, when you hit that realization that it is more powerful to take action and less fearful, there's more at risk for you not to take action than for you to take action, then things become a lot easier for you. So, I think that was this repetitive cycle I got into and people were like, “Oh, you’re money hungry.” I'm like, “No, I'm just completely broke and I don't know how I'm going to eat.” So, it was that sort of mentality, but I developed that into a very, I think, healthy view of money. And it was about that time when I learned about Brian Tracy, and Anthony Robbins, and some of the motivational speakers that really helped me understand that at a young age into my early, early 20s, late teens, that money makes a wonderful servant, but a terrible master. I always kept that in check in knowing, “Hey, this is a great opportunity for me to continue to better my entire life,” not just financially, but understand there's a... What I learned along this path was, I had a mentor, and he said, “Listen, what do you really want?” I was like 21 or 22, and I'm like, “I want to be a millionaire, I got to be a millionaire.” I remember him just thinking and he said, “So Steven, that's not a bad place to be, but don't be or don't want to be a millionaire for the sake of being a millionaire. Want to be a Millionaire because of the type of person you need to become in order to have that goal and to attain that goal.” It didn't quite kick in, the realization of what that meant, until much later, but really, it is a driving force of how I've viewed my life and has led me even in the past 20 years. It's not just the pursuit of materialism or that sort of thing, but it is the pursuit of a higher character, necessary, in my view, in order to attain the type of goals that I want to attain. It's not enough for financial goals if your family life sucks, it's not enough to have great family life if your health sucks, and it's not enough to have great health if you treat everyone else terrible. So, to me, it's how do I become an overall holistic person that adds value to other people's lives. Money becomes part of that mission, becomes part of that. Taking risks becomes part of that. So, I think what happens over a period, Ryan, is that courage becomes habit, and you get into the habit of taking calculated risks or being courageous. Not having all the information, but taking action anyway. Continuing to build up your knowledge and skills so that you can act in the best way possible and minimize the probability of loss. So, all those things, again, it's very hard at the beginning. For me, it benefited me because I didn't have anything to risk. I was like, “I have zero to start with, so it's all upside.” But, over time, what happens is you start developing these habits that turn into pursuits lifelong.
Ryan Berman 9:11
Just so the audience is aware, you and I both lived in San Diego for the same time, for quite sometime before... Now you're up in LA, you're going for it. But it wasn't like we were best friends. It wasn't like we were enemies, but when we saw each other it was always easy. We haven't spent a lot of time together, but I guess I sort of set it up to go… I'm sensing that you're an old soul, and maybe that's because you had to grow up fast. Maybe that 11-year-old version of Steven who remembers that moment, like, that's when it began and off you go into your journey. Maybe it was before, maybe not. But the other reason I'm saying you're an old soul, the idea that you had a mentor at 21, and declared a mentor, consciously declared a mentor, knew who Brian Tracy even was… I'd love to know, how old were you when you started stumbling into those types of people, because I was so afraid, I was just trying to survive New York City. There was a lot more ‘fake it till you make it’ than I would like to admit, and it was, “I'm going to have to outwork you if I'm going to survive,” and that's just the way it is because I'm clearly not smarter than you, other people in New York, I'll just stay here all day all night and outwork you and that's the only way I'm going to survive. So, for me, it wasn't until I was in my 40s, which is where I am now, that I even felt… I found my first mentor, which was a guy named Steve Willhide, who was hired by Steve Jobs to have marketing for Apple for a bit. That was the first time in my whole life where I felt like this man is what I… Yes. Like, “Where have you been? Where were you for the last two decades? I wish I could have run into you.” So, to start, when do you feel like you started to seek out others on your path? When exactly did you move to California? Did you know about the Brian Tracys of the world beforehand, or did you stumble into them once you got here?
Steven Cox 11:21
Yeah, great question. I think the earliest I remember, I remember graduating from high school, and again, none of my family had ever gone to college. I happened to have a girl that I was dating at the time who was extremely instrumental in my life. Somehow she's like, “Listen, where are you going to school?” I’m like, “I don't know.” She's like, “Well, you're going to college so I will help you,” and she was in college, and she did. She drove me around until we figured out how to get into college. It was there that I started, I don't know, I think it was that part out of need. I was just trying to struggle and figure my way through this, and here I was in this new city, which was in Kentucky, Eastern Kentucky University, and I didn't really know anyone, I didn't know a single soul. So, I was just trying to survive, and I remember someone, and I can't remember who, but they gave me a tape, like, the old cassette tapes, and it was Brian Tracy. I had got this job up in Lexington, which was about 30 minutes away, and I would drive my little 83 Mazda GLC up there every day after school, and I would pop that tape in and wore it out. It just spoke to me. He's like, “Listen, if you think differently, you can become different. If you get people who already have done it, you can save a lot of time because you don't have to make the same mistakes.” I'm going, “Oh, okay, I'll just do that.” I think, when we get older, we start throwing up reasons why things won't work or, “Yeah, but…” It's kind of, “Yeah, maybe.” But I think, at that age, you're new and you haven't been jaded yet, so you're just able to somewhat find the tape and go, “Okay, well, that guy just says I need to do that, I'll just go ask some people who are successful and I'll find one,” and that's exactly what I did. It wasn't much pre-planning, it was just Brian Tracy said this, and then, I just went and did it, and it just worked. I just thought that was the way it was, I was like, “Oh, okay, it was very, very simple.” Part of it, I think was luck, and I think when you find a good mentor, and I had a few throughout my 20s, that, I think, kept me out of more pain, which is a giant help, right? I can't say that they catapulted me forward, but they just kept me away from a lot of things that could have been terrible, even in just straight little business deals I was trying to do at the time. So, I started young back then, and I remember, I think my biggest start was, I was 16, I was a junior in high school. I bought my mom a scale for Christmas, bad idea, don't ever do that, not another good idea. I remember, I stepped on that scale and I weighed 205 pounds, a little fat kid, and I'm like, “No wonder I can't ever get a date. I didn't realize I was this fat.” So, I just got really angry, and I remember I went upstairs, and I grabbed a piece of paper, and I ended up just writing down things I wanted differently in my life. I wanted to make baseball team, I wanted to go on a date, I wanted to lose weight. And I somehow, I went to the library, I made copies of that, I posted it on my locker, I posted it in my room, and something magical happened. Within 12 weeks, I had lost 55 pounds, I had made varsity baseball, and I was dating the homecoming queen. Little itty bitty wins in today's time, but I remember going, “Oh my God, this is the secret. If you just write down what you want, look at it, make some changes along the way, you will not hit everything…” And I think out of that, I think it was a list of 11 things, which I still have that paper today, by the way, I think nine of them came through.
Ryan Berman 15:38
Can you please send me that? Can you find that?
Steven Cox 15:41
Yeah. Oh, yeah. I have it in my goal sheet, I'll send it to you.
Ryan Berman 15:46
First of all, I am now showing my own cards, so I'll acknowledge that. I think that is an incredible gift that you can, “If you build it, they will come. If you write it, you can make it happen.” For me, I definitely believe in state-it-and-create-it. I’m a state-it-and-create-it guy. Anytime I've had fear, even when I know I needed to do something, the minute I can just get it out of my mouth, I know it's going to happen. With my book, I was terrified to write a book, I'm not qualified to write a book, how do you do that? The minute I put it actually out there, the book got better. The content got better because people were like, “I love the topic, you need to talk to this person.” So, I'm actually going to do the same thing right now, which I have not announced for something that I know I'm going to do, and I'd love for you to be involved in this. So I had a ‘aha’ moment down at Chip Conley’s Modern Elder Academy, for those of the name, Chip, he was the Modern Elder at Airbnb. He's been out the podcast. He bought property down in Mexico. Steven, you'd love it. It's like, right in your wheelhouse if you haven't been down there. I got to go down there for five days in December, and just sort of like... To be honest, the pie chart of why I went down was like; 50%, I need to disconnect to just go. 30%, probably very curious if I was ever to launch a Courage Academy, how would I do it, and what can I learn from there? Then 10 to 20%, collide with other amazing people, the curiosity project, and maybe have a breakthrough. In that time that I was down there, I realized that what I'm missing for courage, the level that I really, really want to play, is that I want to connect people like us that want to go for it. And it's just so lonely sometimes to be the leader, it's so hard to be the leader, that the community piece is still what's missing. I don't love the word community now because social media has made community mean something I don't think it really means, but tribe. So, here we go. State-it-and-create-it time for me. So, I know I'm going to be launching something called Courage Week. I want this on the calendar every year in September. I kind of feel like we have a summer siesta. Even though January 1st is when our new year starts in our brains, we come back from summer, and I think that's the time to declare the thing you really want to go after, this is just my thing. So, I’m going to lunch a Courage Week, and my hope is, a decade from now, it's a trigger on the calendar that everyone can look to, and turn to, and go for it. It’s going to be different for me than it is for you, or it might be… By the way, it might not even be it for you. It might be like I want to surround myself with others, and I'm really good at helping you fulfill your version of the ‘it,’ and that brings me joy too. So, Courage Week is coming. I know that National Courage Day is going to be September 6th, I have lots of reasons why I feel like I like that day. This isn't about me right now, but you kind of inspired me to share that right now just because, write it for me is state-it-and-create-it, and so, there you have it. First of all, will you join me during Courage Week?
Steven Cox 19:20
If I'm not in acting class, sure, absolutely.
Ryan Berman 19:22
All right, cool. Do you like the idea?
Steven Cox 19:27
Yeah, I do. So, first thing, congratulations on, we'll call it putting it out to the universe. It's almost like the leap where you're standing on the edge and you're safe. And the moment you put it out there, there's risk, but that is the only way things start to take place. So, by putting it out there, first of all, congrats, and that's the -- as you know better than anyone -- that's the very first step towards success. I do like it, I think that there is a... We go into a beautiful environment with like-minded people that have different stories to tell, and we can all learn from each other. It's a beautiful process and it feels genuine and sincere. There are some of these sorts of things, in my view, that have turned, I don't know, commercial. Commercial, not meaning financial, but just smoke and mirrors, and I'm not personally down with that, it's not my cup of tea. But that authentic, sort of, “Hey, we're here to just learn from each other,” I think is a beautiful thing.
Ryan Berman 20:45
I'll keep you posted. For now, it is, and everything you just said is really what it is. Part of the programming is to allow people to connect that are going to come there, and part of the programming is to... I always joke, “Take the courage out of courage.” What tools do you actually need to make it as easy as possible for you to live? Some of it is the network, and some of it is the tool. So anyway, let's get back on track, I just felt like this was the right time to share that.
Steven Cox 21:18
Awesome, congrats, that sounds great.
Ryan Berman 21:20
By the way, in some ways, isn't TakeLessons like… It is a mentorship platform. Did you ever feel that? Was that part...? It’s sort of ironic that you've always had mentors, whether it was ones you didn't know or that was on a tape in your car, to the ones that you did know. By the way, I'm assuming you’ve now met Brian Tracy?
Steven Cox 21:47
Funny story, I won't stay here long. So, I moved out here to San Diego and was running and I think... Do you know Eric Berman?
Ryan Berman 21:57
Steven Cox 21:58
Ryan Berman 21:59
Brother from another mother.
Steven Cox 22:00
Oh, yeah, of course. So I met Eric, and I actually worked with him at his company in College Club. And then. After College Club, he was doing some consulting. He called me and said, “Hey, I've got this meeting, and I could use your internet skills to kind of help drive this in,” and it was Brian Tracy. And Eric, to this day, still runs all of Brian Tracy's marketing, and basically is his business partner. But I was on the very first meeting with him and Brian. In fact, I just saw Brian at Eric's wedding last year, so just another wonderful human being.
Ryan Berman 22:39
Okay, but hold on. When you actually had the moment to meet him, though, what part… Because you've got two options, right? You're like, “Do I keep it together or do I just say thank you,” what path did you go?
Steven Cox 22:55
I don't know, this is a little... I don't know why I do this, but I actually have the same cassette tapes that I’d had when I was 22, and I brought them.
Ryan Berman 23:05
I love that.
Steven Cox 23:06
He's like, “Wow, that's like a blast from the past.” I go, “These got me through and I just wanted to thank you.”
Ryan Berman 23:11
I love that man, that’s so great.
Steven Cox 23:13
I think it was heartfelt, and I think he appreciated it. He probably, honestly, he probably hears that 30 times a day, but he acted like I was the only one that ever told him, and that felt good.
Ryan Berman 23:24
So, as you go along your journey and you end up out here, take me through how TakeLessons ends up becoming a thing.
Steven Cox 23:33
Sure. In a brief history, so I was in college, graduated from college and started working selling lab supplies, and I was living in Lexington, Kentucky at the time, and a guy had started a company out in Vegas, and was looking for people to come out. I said, “Well, what do they do?” He’s like, “Oh, we're going to let people buy stuff over the internet”, and this was 96. I said, “Yeah, I heard about this internet thing”, great. So again, I was 24 at the time, and that was a Wednesday. By Friday, I had quit my job. Saturday, I packed up everything I owned and put it in a storage bin in Lexington, Kentucky, and rented a U-Haul truck and drove out west with two other guys to start an internet company in Las Vegas. We didn't know anything we were doing, it just sounded like a really cool idea because I had never been out west, ever. That was my first time out west, but again, this is taking calculated risks. And I don't know if this is a learned trait or genetic, I do think my thesis is there's a combination of both. There might be a natural affinity towards it, but it is a muscle that you can continuously use to get stronger, and I do believe that.
Ryan Berman 25:03
Steven Cox 25:04
So, I came out west and that company did well for a while during the first internet, the phase that we grew from eight people to 800 people, went public. I was able to sell a couple of shares before everything went back down during the first internet bust. I took that and moved out to California, and I said, “You know what I've always wanted to do? I just always wanted to play in a rock band.” That's how I paid my way through college, was DJ. So, I come from a very musically oriented family and an artist family. So, I just started writing songs and playing music, and I was doing it. I was able to save a little bit of money from the IPO, and I was out playing for fun. My drummer in the band, Enrique, he was an incredible musician, Master's degree in music performance, a fabulous human being, and he was the one that was good in the band, and I was like not that good, frankly. I was getting by, and he covered for me a lot. But he came to me one day, and we were doing this White Stripes thing, just two of us out playing. He's like, “Hey, man, I got to quit the band.” I’m like, “Well, there's only two of us, and you're the only one any good, so this creates a conundrum for me” and I said, “Well, what's the problem?” He goes, “Well I've been trying this music thing for, gosh, for like six years now. I just got married, we're trying to buy our first condo in Encinitas, and I just found that I have a baby on the way, and I can't make a living.”I’m like, “Oh, God, this sucks, you spent all this time in college and all this money, what are you going to do?” He said, “I've got a job lined up. I'm going to be a cook at Chili's restaurant in Mission Valley.” For those of you listening, Mission Valley is this kind of the Mecca of chili's and cheesecake factory restaurants here in San Diego. It's just this, I don't know, place where people go to eat and shop, but that's the last thing he wanted to do. Right? He wasn't a cook, he definitely didn't like Chili's, and he wanted to play music and, Ryan…
Ryan Berman 27:14
By the way, the fact that the better option was a cook at Chili's versus the band tells me that maybe you guys weren't that great of a White Stripes act, just between the two of us.
Steven Cox 27:28
(Laughs) Here's the thing, there are so many groups, and frankly, we were okay. We weren't going to make it but...
Ryan Berman 27:35
Do you have that tape?
Steven Cox 27:37
I do. It's actually on Spotify, the band is called Across The Room, we have two albums out, you can check it out. There are, just for the record, they are 90s albums and they sound like 90s albums, but they were a lot of fun. To your point, he suffered and we suffered the same thing that a lot of artists do, and I'll take artists and just innovators in general, that is that they can be great at their craft, but it is very, very difficult to make a living doing what you love to do, and Enrique fell in that category. Great at what he did, very, very difficult to make a living. So, I said... I kind of got pissed. Here's my good friend who all he wanted to do was make people happy through his music, and he could not figure out how to pay his bills with it. So I said, “Well, are you working in studios?” He's like, “Yeah, I'm recording as much as I can.” I said, “Are you teaching?” He said, “Yeah, I've got my poster, it's hanging up at the drugstore,” with all the little tabs down at the bottom that you can rip off with the phone numbers on it. He goes, “Yeah, but no one's calling me”, and I go, “Man, why don't you use the internet?” He’s like, “I don't really know much about that, I'm a musician.” I said, “Well, I got some experience with that from my prior company, I'll help you.” So, we started to TakeLessons in a spare bedroom in Mission Beach, which is just a little beach area of San Diego, and with the whole idea is if we can get enough people to the website, we can keep Enrique out of Chili's, and that was the only thought, right?
Ryan Berman 29:12
Did you ever make that T-shirt?
Steven Cox 29:14
Save Enrique, sort of [Inaudible 29:16] Headrow?
Ryan Berman 29:18
Steven Cox 29:20
(Laughs) That would have been a good one. So, luckily for us, there were tens of thousands of other artists and what turned out to be educators that had the same problem that Enrique did, and that is, “How do I do what I love to do, and not have to take a boring office job and do things that I have to do?” So, we use that premise... Go ahead.
Ryan Berman 29:42
I will just ask like, how often... Is this the universe at work again or is this… You've now done this enough times and the muscle is built, and there's a love and a passion for music, and you've just spent however many years understanding the Internet. So you've taken a skill that you've learned, you've taken a skill that you've built, what I would say is resilience at this point, you jumped on this ‘let's go West, to Vegas.’ So you've seen that before, you’ve taken the thing that it sounds like you love the most, or near the most, across the room on Spotify. And then, all of a sudden, this little moment falls in your lap that's like, “A baby's on the way.” Do you ever just step back and go, why hasn't this been done? Pinch me moment, thank you universe, or do you just feel like, oh, wow, that's true, a lot of artists would just love to get paid to do what they love, and there's a need for this and off we go.” How sentimental was this really, I guess?
Steven Cox 30:53
From a sentimental point, not that sentimental, and the reasons why is because -- I was talking with Brian Tracy about this once, and I said, “All these things are lining up” This was, I don't know, maybe five or six years ago, I said, “All these things lined up perfectly for me.” He goes, “Well, in a way.” What happened, let me tell you what happened. He said, “What you did is you started walking down a dark hallway, and you got to a door, and you twisted the knob of that door, and you know what happened? Nothing, the door was locked. But instead of you giving up, what happens is you kick the door a little bit, and then, you happen to turn the knob, there’s another side hallway, and you follow that hallway down, and there was a door there. And you twisted that knob, and you know what happened there? Nothing, it was locked. But there was another hallway, and you got to that other hallway, down to the end, there was another door, and you twisted that door and that knob and it opened. And you would have never had that door open if you didn't start walking down the hallways where the doors were locked.” He goes, “So yes, the universe lines up some things for you, but, at the same instance, give yourself some credit because you kept walking.” I do think there's this combination of the universe provides hints and breadcrumbs for us on what we should be doing, however, it is up to us to take the action in order to do that. The universe alone will not... I believe John Assaraf always says, “You must participate in your own rescue.” The universe will provide, you've got to step up.
Ryan Berman 32:35
Yeah. Stepping up, let's talk about a decade and a half of stepping up then because once that door opens, I'm sure there's lots of other hallways, and lots of other doors. Some doors are locked, some doors are open, you find some keys. It's taken 16 years to take TakeLessons to a place where 25 million people a year now use the platform, and I think this is both online and in person. Correct?
Steven Cox 33:07
Ryan Berman 33:09
What a ride, huh?
Steven Cox 33:12
I wish I could say we were like the Instagrams, or Airbnbs, where everything was like up into the left. Frankly, that was just never our path. We struggled to find a business model. There were a couple of times very close, we were within a month or two of shutting down. And, at the beginning, it was just my money, and that was deteriorating fast. Luckily, we did raise some venture capital over time, but it was harrowing. And my journey is, this looks like, “Oh, this is…” And we all like to talk about the successes, but for any listener out there who is then asking, “Shit, I'm not having that level of… God, this is mine, it’s hard.” Let me be the first to tell you, and Ryan, I think you can echo this, yes, it is very, very, very difficult. It's easy to remember the successes, but I will go on record and say we had just as many failures in that business. What we did is we learned and iterated from each one of those failures, and we started failing less. Year by year, we started understanding where's our business model. How do we provide value to a student and a teacher so they can match and meet in the middle? How do we make money from that? Who's interested in this model? How much do we have to...? All these sorts of questions. And when you raise venture capital -- we ended up raising about 22 million dollars, 21 million, somewhere around there -- it comes with expectations on growth. And so, now, on top of just having to get the business model right and be a wonderful resource for your customers, you now have a new customer, and that’s your funder. Sometimes that works out well, sometimes it doesn't, but for us, it was two steps forward, a step back, three steps forward. But, all during that process, I would tell people, I said, “We're not, in fact...” I don't know if Mike Krenn. Mike Krenn, he's the Head of Connect here and Startup San Diego here in San Diego. He goes, “A lot of companies are like unicorns, where they take off and they're doing great.” He goes, and he said this was the most love possible, he goes, “You're kind of like the energizer bunny of the cockroach, you just kind of refuse to die, you just kind of keep going.” Year after year, and we've had a great chuckle over that, but it's so true. It's like, sometimes, if you just figure out how not to die, life takes care of itself. All during this path, Ryan, there were hundreds of competitors. People that came out of the wood and go, “Yes, I'm doing this, and I've done some version of that.” Probably out of the 100, 120 companies over the years, there were three in our field that mattered, and mainly because we just stuck with it. Yeah, humbly, I think we were pretty smart, hired some great people, and we executed well. So, it was certainly not a direct ride to the top, but it was a challenging ride that challenged me to become a better person, a better CEO, a better leader, and to make something going that we're all proud of.
Ryan Berman 36:40
When you think back, and, by the way, I so appreciate you sharing both sides; the realities of the goods. The unicorn days and the donkey days, the cockroach days. When you think about some of those, this is a ‘just don’t die day,’ how often is it the 11-year-old version of you boy in there? Do you remember that little boy still in those moments? Does that boy still live in you? I'm trying not to lead the witness a little bit, but I do think that a lot of us are still like little boys and girls trapped in these adult bodies just trying to get by. So, what does it look like for you?
Steven Cox 37:28
Yeah, great question. So, we are. What happens to us, I believe, as children does reflect in our lives, and it is up to us to decide what parts of those we want to keep, and what parts we're going to throw away. So, for me, I remember, gosh, it was probably eight or 10 years ago now. I went to a week-long, no phone call, no cell phone, therapy session, I guess you'll call it, called Hoffman. Hoffman, for me, what it allowed me to do was understand that there were a lot of things from my childhood that was still determining how I reacted today. Going through a week-long process allowed me to ask the question, “Where's this decision coming from and does it belong in my life anymore?” So many of us, up to that point, and even me, up to that point I was in my early 40s, I hadn't asked the right questions. I didn't know that some of these childhood beliefs were driving some of my actions. Just by being able to be aware to ask the question allowed me to make the decision. In certain instances, I have decided to throw that away. I remember, in one particular instance, we were going through this exercise, and I said out loud -- we were yelling at our parents, I guess, in a safe environment, I said out loud, I was like, “Dad, you didn't take care of your own family. We just had to struggle, and we struggled so much that I don't even want a family of my own.” I’d never said that out loud, and I didn't even realize that the reason that I have an aversion to wanting kids, at that given point in time, or family, was because of the fear, an innate fear that somehow I would do the same thing my father did. So, that realization allowed me to set that theory in my head free. There were other things that were happening and other feelings and thoughts that I decided to keep, and one of them was this kid who felt the pain of not being able to provide or not having enough. So, I have a mantra that I use, and it is that, universe helped me balance being peaceful with staying hungry. So, I decided to keep the hunger because, I believe, for me, I still look at it as a driver and a motivator for me, and I use that to my benefit, and it no longer negatively directs my life. So I found a way to spin that into a strong positive. But the goal is being able to look at yourself and say, “What are the actions that I'm currently taking that are old, that only reside in my head, they’re no longer in the world?” Whether it's parents did this to me, grandparents did that to me, uncle, whatever, in fourth grade I got beat up, whatever, that's not here today, but you're still letting it control your life. Make the decision not to. And by making that decision, it allows it, really, a lot of change.
Ryan Berman 41:02
I love how intentional you are, and, by the way, that word ‘hunger,’ it’s interesting how that word might have evolved for you over the years to hunger, like, stay hungry. The journey that you're on now, I'd love for you to sort of set the stage of where you are and like, because this is just audio, what I'm looking at. Before we do that, let's just sort of put a bow on TakeLessons real fast. So, two real quick questions. One; you said you founded it at first, I'm sure there was like, “Oh, shit,” moment. And then, you're like, “How do you even raise money?” How did that conversation even come about? 21 million is not a small number, I'm sure that's over a period of time as well. So, what was the big ‘aha’ learning moment for even asking for money or raising money? Again, I wish we had two hours because I really want to talk about what you're doing now. Talk me through this past year. You are officially free of TakeLessons I believe, correct?
Steven Cox 42:16
Ryan Berman 42:18
All right, so let's go back to VC, asking for money, what was that like? How hard was that?
Steven Cox 42:28
In the first company, that company raised… And again, it caught the first internet bubble, so it raised about $114 million. And I watched. I wasn't the founder, but I was an early employee, and I watched the CEO, he’d just go out and talk to people and they'd give him money. I was like, “Oh, okay, that's kind of how things work.” Then at College Club, that company raised somewhere around $86 million, or so, and the same sort of thing, still in the first internet bubble. So, they'd go out, talk to people. And it happened that a buddy of mine introduced me to a VC that I then introduced to the company, and that VC invested. I'm like, “Oh, that's cool, if I ever start a company, I'll just go do that.” I didn't really know any better, I think that was the correct answer. When I started my company, I’d seen how companies crash and burn during that internet phase. I did have a little capital myself, so I put in the first few hundred thousand dollars. I got to the point where I had to decide, listen, either I got to keep funding it, which is going to really start hurting here or I've got to go get some money. So, we raised some friends and family money. And, in fact, Eric was the very first investor in the company, as a matter of fact, Eric Berman. And I think he put in five grand.
I raised some money, I put a deck together that I'd seen another guy do, and started talking to people here in San Diego who had raised money. I raised probably 800 grand from friends and family, and that got us through, and I started learning. That money then is expected hit certain milestones. Once we've hit those milestones, that then gives us the liberty to go raise more. I’m like, “Okay, I see how we can build a business here.” So, we just focused on hitting those milestones, and then, when we went out to raise venture, I don't know, at that point we were in strictly music lessons. So, a music lessons company, not really a VC play, but what I wanted to do is, I said, “If I could get this right for music, I could then tack on languages, and tutoring, and sports, and all different types of things where people could learn both in-person and online,” and that was the vision from day one. So, we went out to raise venture. I'll tell you this real quickly, so I think the big change came when we were still in music. I was on a treadmill at FIT downtown, at the club downtown early in the morning. It’s, I don’t know, 6:30 in the morning, there was a guy on CNBC, I was watching it named Steve Hair. He was the corporate vice president at Best Buy. And he said, “Hey, we're going to go put these music stores inside of Best Buys, and we're going to sell musical equipment that ties with electronics, and we're going to have stores in there where you can learn to play.” I’m like, “Oh, they need us. They don't know what they're doing.” So I got off the treadmill, and I went home. I found Steve Hare’s number, and I called him, and he didn't answer my call. So, I called him again, didn't answer my call. 38 times, and he answered my call. Finally, he's like, “What do you want? Jesus.” I told him, and three weeks later, we were in Minnesota or Michigan, wherever they're at, they're up there, I believe it's Minnesota, and we struck a deal where we were going to provide all of Best Buy stores with the lessons, and we're going to run that. At that given point in time, I had no way to pay for that. So, we took that deal, went and started talking to VCs. I talked to 114 venture capitalists, for our first deal, but all it takes is one. You just have to find the one that believes and already has a thesis around what you're doing. So, we found that lead investor, Crosslink Capital, wonderful venture capital firm, and then, we were off to the races.
Ryan Berman 46:29
First of all, to use the Tracy metaphor, it's like 37 locked doors. And, by the way, it's the same damn door that you knocked on until the door finally opened, and then on the VC side. So, wow, but what other option did you have? You had to make it work at this point.
Steven Cox 46:52
Again, I think there's power... I was just talking to a friend, I'm hooking up with some guy up here and his name's Andrew Lenchewski, and he is the producer… I’ll remember the name of the show, it's like a doctor show on USA. I'll remember it here in just a second. Basically, I asked him, I said, “Why did you get into production?” He was like, “I had to almost live in my car for two years.” I said, “What kept you going?” He goes, “What kept me going is I had only done this for so long that I knew that to go back and be a doctor, or a lawyer, or even a business person was going to take so long, that I just didn't have any choice.” It's almost this thesis of like, the bridge is burned behind me. I don't have… The show was called Royal Pain, so I just remembered. But if you don't have the bridge behind you, you have no choice but to move forward. Andrew had said, in my own words, that's how he had experienced it, and I had the same experience.
Ryan Berman 48:01
All right. We got 10 minutes roll to go here. Let's get to the rainbow. There's a rainbow, so what was the rainbow like, and did you get to a point where you're like, “It's time to sell this thing,” did they find you, how did that happen?
Steven Cox 48:21
Yeah, great question, Ryan. So, when you're taking venture capital, you are for sale immediately, that's the name of the game. They're not signing up so you can get a paycheck, they're not signing up for a dividend, they're signing up to exit. So, as a CEO, you know that that's part of the game. For us, we had been funded for a while, and there are cycles in the marketplace. Sometimes, you are hot, marketplaces as general is hot. And then, other times, you could have an incredible business but you are not getting funding, period, because it's just out of favor. And you see these cycles both in public markets, as well as private markets as well. So, in our particular case, I had seen a couple of these markets when marketplaces were hot, and then, they got cold, and we missed them. In our particular instance, the pandemic hit, and we were already doing very, very well, growing nicely, great team, and the pandemic hit, and we exploded. Our business grew exponentially over the prior year, and I went to my board and I said, “Now's the time.” So, we hired a banker, and put our deal terms together. Went and talked to a lot of people, had a lot of interest from both private equity, as well as what we call strategics, which are people who could fit, take lessons into their own business. Eventually, we had quite a few suitors, and a group out of the Pacific Northwest, Microsoft, ended up being the right place for us to continue to build. So, we were very fortunate the deal was… Microsoft’s a great company. They are very, I’ll call them very diligent in their acquisition process. To get a deal done, there's these things called hair on the deal, which basically means they're looking for a reason to say no just because the deal would pull from their brand. In our particular case, we didn't have all those negatives associated with our business. It's in a great industry, it helps people, it's wholesome. And they wanted into the space to do a few things. So, we were very fortunate, the people who are running the business now are extremely diligent and knowledgeable in how businesses operate. So, I couldn't have been happier, and more importantly, is all of our employees, not only did they keep their jobs, but they all got raises. I don't know if you heard, Microsoft pays a little bit better than we could. So, it was just a wonderful win-win opportunity. That deal closed last year, it was October, so it’s like, 14, 15 months ago. They're doing a lot of testing, they've expanded out. We were at 96% US, and they just launched India, they're launching Latin America, they're taking it worldwide and doing things that we just never had the ability to do. So, I'm very, very happy and pleased with where they are.
Ryan Berman 51:24
Two obvious questions come off that, both quick answers. One, are you like, “Oh man, they’re taking it global, I wish I still had a little part of it,” or are you like, “Fly little bird, fly”?
Steven Cox 51:37
No, it's not my company, so I'm fine with that. I always say this, there's a time for a CEO or leader, you need to know when your time is done or else someone will tell you. (Laughs)
Ryan Berman 51:55
(Laughs) All right, question number two. Enrique, how did he do in all this?
Steven Cox 52:02
Enrique, so a couple of things, Enrique never took that job at Chili's. Yeah. Not only does he still teach on the platform, he has two beautiful daughters. He makes his living playing music, and he has toured the world now with Latin American artists. So, he's doing very, very well. And one of my most proudest moments is I made sure that he also had founder stock in our company. And so, when we exited, I was able to surprise him with a nice upside that he did not expect.
Ryan Berman 52:34
That's so cool, man, bravo, seriously. All right. I can't wait to listen to Across The Room, by the way, that's on my list. So, we're right back to where we started, but it takes a while to hear the story, right?
Steven Cox 52:48
Ryan Berman 52:48
So, now what? Most entrepreneurs I know, after they drive themselves mad on a beach, that line between busy and boredom is very thin, are like, “Well, what's the next company I'm going to start?” I'll admit, what really drew me back to you Steven was I saw one of your posts that you shared, it was even on LinkedIn or Facebook, I think was on Facebook, actually, I could be getting this wrong. It was you talking about this new lead that you just had to try. And you're in LA, you made the move, you sure look like you were in a studio, I still see tenants of music as there’s a piano-ish behind you. Correct?
Steven Cox 53:36
Ryan Berman 53:37
So, talk to me about acting and why you have to do this.
Steven Cox 53:42
So, I, again, come from a… I think I’m half business, half artist, and I come from an artist background, I happen to understand business pretty, pretty well. What I learned from TakeLessons was that there is this crux where you could do both, you could do business but also doing artistry along with it. I also learned the value of jumping in, trying something new that you didn't know whether you could succeed or not. Some of those challenges are what creates the most growth in a human being, I believe. So, when I was looking around, I took a few months off to try to figure out, who am I? What do I do next? I made a list of things that I potentially wanted to do, sitting on the beach, luckily, was not one of them. I know I'm not supposed to do that, but I had looked at politics, whether I wanted to get involved in public service and run for office. I had looked at starting another company and sitting on boards, or jumping into another creative aspect that I wanted to do. So, I started looking around, talking to a few people, and I've done a little bit of theater in my day, and always just had this draw to this. So, I started studying it and realized that the ability to... First of all, what I knew is whatever I did next, I want it to be very uncomfortable, I wanted it to challenge me, I wanted to do something new that stimulated my brain in a creative way. I've always loved acting, I've done a little bit in my day, and so, what I decided to do is not start another company, to run away from that which comes the easiest. I did it on purpose to challenge me. And I wanted to get super uncomfortable, and so, I moved to Hollywood. I'm in Hollywood right now. I'm in acting classes three to four days a week. This is my full-time job, and I am running hardcore at it and learning things that I never thought I would ever learn before. Being really uncomfortable in class. Obviously, the class is normally between 19 to 25-6-year-olds, and I'm a tad bit older than that, and I just don't care. I just don't care. I'm here, and also, people are like, “You're just out there to learn, or are you going to try out for a role?” I liken it to if you're in high school football or college football, and it's great if you go to practice, but the reason you're practicing, so you can get in the game on Sunday. I will also state for the record, so mark my word, I will absolutely be auditioning and I expect to land roles, period. I am applying some of my business, and that tenacity, and that drive to a creative aspect. So, not only am I going to get really good at just the creative aspect, but I'm going to drive this hard, and have a ton of fun in the process. I am enjoying myself like crazy. So, I feel very fortunate.
Ryan Berman 56:54
That's so great. Look, to use the sports metaphor, if you're still in Pop Warner or high school, let's say it's high school, you don't really jump right to the NFL, do you?
Steven Cox 57:07
Ryan Berman 57:08
So, I'm assuming you feel at peace with where you are in your development as you continue down this path to be, eventually, ready to be spotted, to, eventually, be... Is that how you see it?
Steven Cox 57:23
My coach told me, he said, “Listen, this is a long road, you got to be ready for rejection.” Immediately, I remember being rejected hundreds of times by venture capitalists.
Ryan Berman 57:37
It's no different.
Steven Cox 57:38
So, I just don't care. Everything I've done prior to now has just prepared me for this. In fact, I've got this on my screensaver, I'll read it to you. It says, “You're right on time for your next chapter. All the prior chapters prepared you for this moment even though this is a page you've never seen before. Trust the process, you're ready.”
Ryan Berman 58:05
So great. And you have fans already. I'm a fan, I'm rooting for you and I can't imagine I'm the only one. And for those… Look, just to throw it out there, you can follow Steven along. MStevenCox is where they can find you on Instagram.
Steven Cox 58:26
Amazon Michael. Yes. MstevenCox.
Ryan Berman 58:29
Amazon Michael. So, are you going to change your name?
Steven Cox 58:31
I don't plan on it. I like my name, so we’ll see.
Ryan Berman 58:36
Hey, who knows? It's so funny. I throw these weekly dose of courage emails out every Thursday to just who needs a little nudge. And one that I know I'm doing that I haven't done yet is pretty much exactly what you stated. Yours is just much more elegant, I'm usually pretty, like, much more layman, I'll just put it that way. Mine is, I think in life, the minute you care and don't care at the same time, you're on your way. I think it's so clear that you care and don't care. And, of course, you care, and it lights you up, and you also are able to not care, and you don't let the wrong type of gravity put you down. When you look at it the way you have, it's all just the little battles, these little... You're exactly where you should be, it allows you to stay down the path that you're on. Wow. Again, I think it's so great what you're doing. You can't be an actor and not act on the idea of going for it. So, thank you so much for giving us the story.
Steven Cox 59:49
Yeah, it’s great being with you today.
Ryan Berman 59:50
I think we're only in act two, we might be in late act one, by the way.
Steven Cox 59:56
Yeah. There's a lot more to this story, for sure.
Ryan Berman 59:58
You said, the show is Royal Pains?
Steven Cox 1:00:01
Yeah, Andrew’s show is called Royal Pains, and that's now off-air but it ran for 104 episodes, a really long-running show.
Ryan Berman 1:00:11
I will listen to Across The Room. And then, I can't wait to add a third, things happen in threes, that first commercial or... What happens if it's a commercial, will you take it?
Steven Cox 1:00:22
Probably, in fact, I'm doing a class January 24th, or so, that's specifically just teaching commercials. What the differences is, the difference in way of acting, and what you're looking to in the objectives of the particular script. So, I'm doing that, I'm looking at different sorts of acting realms. My coach says that it will probably be six months or so before I'm actually ready to audition, and I'm great with that. I get six months to learn from some of the best people in the industry how to do this. And some of it comes natural, there's no doubt about it. I do have -- I’m thankful and I'm very humble inside that it does come a little bit naturally to me. So, it's not so off the wall that I can't do it, but there's, oh, there's so much learning, and I can't wait. I get to learn for the next six months before I even have to step up.
Ryan Berman 1:01:22
The irony that the CEO of TakeLessons is now taking lessons, it's there. All right. Stay courageous, Steve. Great to see you. Thank you for joining us on the show today.
Steven Cox 1:01:34
Thanks for having me.
Ryan Berman 1:01:36
Thanks for tuning in to this episode of The Courageous Podcast. If you enjoyed the show, don't forget to rate and review us on Apple podcasts so more people can find us. See you again next week.
(Outro Music 1:01:46-1:02:01)
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