Tony Conrad has had a very good year. Scratch that. Tony Conrad has had a very good five years. Since parachuting out of an imploding VSP Capital in 2004, he has become a venture partner at True Ventures in San Francisco, a special advisor to AOL Ventures, and he has co-founded and sold two companies — Sphere and About.me — for at least $50 million dollars to AOL. (Sphere and About.me collectively raised less than $4 million prior to their sales.)
It’s the kind of run that many entrepreneurs dream about, and it’s not dumb luck. Conrad says he owes much of his recent success to relationships he has maintained with a wide network of friends and colleagues, including Brad Garlinghouse, a former Yahoo executive who joined AOL in 2009. For example, while at Yahoo, Garlinghouse led the acquisition of OddPost, a company that Conrad backed while at VSP. It was also Garlinghouse who led the acquisition of About.me just two months ago.
Keeping up ties doesn’t sound like rocket science, but Conrad talks with some amazement about how quick many entrepreneurs are to burn bridges, particularly with the companies that acquire their startups. “Being there and being rude to them or flippant to them, I don’t know what that accomplishes, but I see entrepreneurs do it all the time,” he told me over lunch yesterday near San Francisco’s AT&T Park.
Certainly, Conrad could have, too. Sphere — which raised $3.5 million and sold to AOL in 2008 for a reported $25 million — didn’t exactly fare very well under its management. Conrad was quick to point out that the economic crisis didn’t help, but it was also clear that “there was a leadership issue and that AOL didn’t have a clear strategy about what it wanted to do.” Indeed, once in the AOL family, Sphere wasn’t able to hire anyone or develop new products. It survived simply to “meet short-term objectives,” says Conrad.
Earlier this week, Sphere, which was renamed Surphace, was sold again for an undisclosed amount to the content recommendation engine OutBrain.
It remains to be seen whether About.me, a personal profile page maker, fares better inside AOL than Sphere. Though the sale was a great financial deal for the year-old company — it raised just $425,000, including $50,000 from AOL Ventures, before selling for a reported $25 million — its future is largely out of Conrad’s hands now. While he remains its CEO and speaks glowingly of Tim Armstrong, AOL’s CEO since March 2009, there’s simply no telling how well the product will fare — or the life it might have enjoyed otherwise.
Still, you’re not likely to hear Conrad complain about it either way.
“I always say that when somebody offers to buy your business — and they actually follow through and do it — it’s one of the most flattering things that can happen to you as an entrepreneur, irrespective of what happens after they buy the business,” he said.
“I know [it can be] a bummer — that they may screw it up, and it may make you unhappy once they own it,” he added. “But I think it’s important to remember that somebody was willing to buy your business, and that’s a really nice compliment.”
Too many people “have these big, seismic, earth-moving-statement kinds of exits, where it’s, you know, screw you, whatever,” said Conrad. “I think being respectful, checking your ego, being cool and finding a way to exit gracefully is much more interesting.”
It’s also good for business.