Few startup CEOs can claim a hat trick — that is selling three startup companies to top industry players — but Jon Fisher, serial entrepreneur and the author of Strategic Entrepreneurialism, is among them. A classic Silicon Valley inventor who says he owes much of his inspiration to his team as well as his mentor and early investor, Ray Lane, Fisher has seen three companies he co-founded as CEO get acquired — Bharosa, NetClerk and AutoReach are now owned by Oracle, Roper Technologies and AutoNation, respectively. Fisher, who is working on his fourth startup, CrowdOptic — which he also aims to see acquired by a Fortune 1000 company — says his team shares a common thread, much like a family but in a business sense.
Fisher’s Strategic Entrepreneurialism has long been required reading at the University of California, Berkeley, and in a number of other top universities’ business classes. In it, Fisher explains that building a company for an acquisition — rather than for an initial public offering — is often the best route for startup co-founders.
An IPO, which Fisher describes as a “moonshot” for most companies, can “distract from the purpose and the skill set of most startup teams,” says Fisher. A straightforward SWOT analysis often proves a strong co-founding team, while well suited for the first leg or two of a startup’s journey, are ill prepared to transition to the more bureaucratic and sales-heavy middle and late stages of a company’s growth. The lack of preparation can be a distraction for most startup teams, who risk using brainpower and planning hours in the earliest stages of a company’s life cycle that could otherwise be purely focused on identifying likely strategic partners and in turn, acquirers.
Fisher told me an email interview that his team brainstorms ideas for companies based off of diligent market studies. “A market study doesn’t have to be formal,” says Fisher, who prefers to see companies “fail fast” in order to keep costs as low as possible until they’ve found a good product-market fit. “My latest inspiration came from my daughter,” Fisher recalls. “As a parent, safety is paramount and I wanted a way to learn more about her world, how she sees it and perceives it, and also be able to best understand how a child interacts with her world as she develops.”
Fisher and his team assembled a new form of triangulation algorithm that CrowdOptic patented and that would later be put to use in applications ranging from tracking a NASA lunar lander to introducing the Department of Defense to augmented reality technology that it has prototyped for Special Ops forces. “I have cameras as well as a number of smart wearables around my house,” says Fisher. “Powered by the company’s software, I’m able to inherit the view my daughter has when she has a smart device on her and the reverse is also true. It makes her feel like a superhero — because she is one.” In a July feature about CrowdOptic, Business Insider described the company’s technology among the “coolest” it has seen and described its tech as being able to “look through walls.”
CrowdOptic now leads augmented reality solutions across sports, medicine, military and emergency response. Among the original Google Glass partners, CrowdOptic remains the only patented solution, which suggests why Sony — with its own iterations of smart wearables — picked CrowdOptic to demo its own hardware at the Broncos’ championship game in 2016. Now named to 53 patents globally, Fisher explains that his team’s ability to think like a unit and galvanize around an idea to make it a practical reality is what makes his companies outperform their peers.
In 2004, Fisher conceived of Bharosa, a software company banks rely on to protect ATM transactions from fraud. In the mid-2000s, it was feasible to insert identical ATM cards at multiple locations and, simultaneously, punch in identical fund withdrawals only to register each withdrawal as one transaction. “Fraud was rampant,” recalls Fisher, but Bharosa, which would later become the Oracle adaptive access manager, solved it.
Fisher drew on the same team that built NetClerk, which is now part of publicly traded Roper Technologies, as well as AutoReach, now part of AutoNation, to build Bharosa. “Strategic entrepreneurialism is simple,” says Fisher. First, identify the target acquirer and work backward to build sales and operations, which should galvanize around clear and useful intellectual property that meets a need. For big banks, the pain point was very real because the industry had few defenses to cope with rising fraudulent ATM transactions.
Oracle, already well integrated with major financial firms as a database and software service provider and vendor, was a good fit for Bharosa, which at the time of the acquisition had proved out the technology and use cases to show theft prevention. “We knew what we were building and exactly for whom we were building it,” says Fisher. Which are words to the wise for startup enthusiasts everywhere looking for their first exit on the way to a hat trick.