Jeremy Weisz 5:44
So for people who don’t know Baháʼí, can you give me just a brief introduction?
Steve Sarowitz 5:48
Yes. So those who are in the North Shore of Chicago might recall the beautiful Baháʼí temple
Jeremy Weisz 5:55
beautiful, it’s absolutely beautiful.
Steve Sarowitz 5:57
This behind me actually is in Israel. This is the Baháʼí gardens in Haifa, Israel. Baháʼí Faith, we would describe as Baháʼís as the latest chapter in God’s eternal fith. So we as the highs don’t believe that Moses was wrong and Jesus was wrong. We believe that all of the prophets of God, Moses, Jesus, Mohammad, are true prophets, their religions are true religions. And their teachings are right. And the latest version of this is from Bahala. And what the whole law said Is he was the promised one of all faiths, and his message that we’re one human family, as I said before, get rid of racism, sexism, get rid of nationalism, get rid of religious prejudice, all the things that divide humanity. And he said, it’s not only possible to do this, but inevitable that we will do this and unite as a single human race. Baháʼí, so Baha’s like me are terribly help, even in some dark times that we’re going through.
Jeremy Weisz 6:52
Wayfarer studios, how does that link to Baháʼí?
Steve Sarowitz 6:58
So both Justin Baldoni My partner and I are Baháʼís. We met through the by faith. I met him when I consulted with him about The Gate. And Justin is a very public Baháʼí and he’s far better known than I am, he played a character called Raphael on Jane The Virgin. And he’s directed a couple big movies. So he’s this celebrity. I’m, we talked about this, I’m the money and he’s the fame. But we are just great friends. And we really share these ideals and the things I mentioned, the things we’re promoting waste. It’s Wayfarer, like traveller, Wayfarer, and most of the employees at Wayfarer are not Baháʼí actually. But they understand where we’re going and they share these values. And then that’s very important for us as Baháʼí because we think we’re one human family. It’s not like we need everyone to be Baháʼí . We want to just spread these, these teachings of oneness. And so that’s what Wayfarer is doing.
Jeremy Weisz 7:55
Yeah, if people don’t aren’t watching the video, listen to the recording audio. You have a shirt on?
Steve Sarowitz 8:02
I do. And this is the white bear. Yeah, actually, it’s just from our charitable arm, which we are looking at me potentially changing the name of the the main slogan is be loved.
Jeremy Weisz 8:15
And, you know, I was watching the interview with Rainn Wilson, barely known as Dwight Schrute. And so is he also Baháʼí .
Steve Sarowitz 8:28
He is a Baháʼí a very good friend of mine, I adore Rainn. And we’re looking actually at doing a project with him with Wayfarer right now, which I’m really excited about we we haven’t signed the deal yet. I’m really anxious to sign the deal. So I can tell everyone about it, because it’s a film we’re looking to do with him. And I’m just really excited about it. And he was in The Gate. By the way, if you saw The Gate, you might have noticed that rain was in The Gate. But he’s a he’s a super person. He is a Baháʼí a lifetime. But is this Justin, they’re not newbies like me. But they’re both tremendous people. First, Baháʼí second and then of course, they’re good friends as well. Both of them. Yeah,
Jeremy Weisz 9:05
I want you to talk about I’m gonna be talking about The Gate a little bit, but um, the people can check out Clouds on I think Disney Plus, right? Um, I remember hearing that song. Listen that song. It must have been like 2010 like, actually when? I mean, when was that when the song came out? It was when Zach was still alive. Okay, whenever Yeah, when it came out. How did the Clouds come about?
Steve Sarowitz 9:36
So, um, Justin actually did a documentary about Zach when he was still alive for My Last Days. And this actually was what kicked off My Last Days which became a very successful series. It was about people dying. And so I leave it to Justin to do something to take this potentially morbid subject and make it joyful and hopefully Although Sirius and so Justin did a wonderful job with this and many others, and he kept in contact with the family, Zach’s mother wrote a book. And Justin wanted to make the movie for years, the rights went different ways eventually came back around to him. And by the way, just speaking of Rainn Wilson, the original documentary was a partnership between Rainn and, and Justin movie was not, but the original partnership was in my last days. So Justin, eventually was was given the rights to direct this movie. And here, here’s where the story gets interesting, because he was just a director for Warner Brothers, Warner Brothers was going to short us a little bit on our budget, which is very typical. And Justin went to them and said, I have some money now we adjust literally, ink drying on the paper, created Wayfarer Studios, which I so I could invest in movies. And Justin said to Warner Brothers, well, I’ve got an investor now your partner and I have some money. I’ll make up the shortage. And Warner Brothers not surprised and said, Oh, no, no, we were just kidding. We’ll give you whatever you want. Or, you know, we’ll give you the extra million dollars.
Justin said, no, actually, you know, if possible, we’d really like to be your partner. And we’d really like to buy into half the movie and Justin, and I figured that would be the end of it. We never thought Warner Brothers would take us up on that. But they did. And so we ended up being 5050 partners with Warner Brothers, and at the end of it COVID happened. And what happened. We ended up buying Warner Brothers out and selling it to Disney Plus, and it’s just been a it’s been a phenomenal success. Disney’s extremely pleased with the results. And I love the movie, and the story. And Zach and his family. Yeah,
Jeremy Weisz 11:45
everyone has to check it out. Definitely just just Google it and listen to the song on YouTube. There’s so many videos, and you mentioned My Last Days, there’s a bunch of videos on YouTube for that. But check out the movie Clouds on Disney Plus. And so we’re kind of going in reverse order, then we’ll go back to your, your business journey days. But The Gate is what came about, tell us about The Gate.
Steve Sarowitz 12:10
So I became a Baháʼí, as I mentioned, six years ago, and three days after I became a bi, I emailed my friend who’s also in the payroll business to talk about a little connection there. And I said, Oh, shoot, I’m a Baháʼí now. And I jumped up and down as high as then 49 year old man, good job, not very high. And I and I said I’m going to just teach the Baháʼí Faith, I’m done with business. And I’m going to do that the rest of my life and he said, Well, you could do that. And you could maybe reach hundreds of people. But if you made a movie, you could potentially reach millions of people. And so less than an hour later, I got an email from a man by the name of Peter Sanderson. He’s made about 25 movies. And Peters most well known movie is called Revenge of the Nerds.
Jeremy Weisz 12:56
Gotta love Revenge of the Nerds. Yeah, it was funny because when you said that the Rainn Wilson he he basically is fun fact. He’s like, Oh, I met booger or something like that. Yeah, is
Steve Sarowitz 13:07
that that would be a typical Rainn statement rain. Really funny when I tried to make jokes. Rainn just tells me leave it to the professional. Anyway, so I Peter wants me to do this foster thing with foster children, a nonprofit thing, nothing to do with movies. And I ended up doing it. So I ended up working with Peter and his wonderful nonprofit first star. And I ended up going out to California about a week later to talk to Peter and I mentioned the movie and he said, Oh, come talk to me. And so I told him about the movie. And it turns out, we were actually outdoors at Santa Monica. And right next door to us was a table with another two people and one of the two people at the table right next to us. He had also been talking to someone about making a Baháʼí movie, the odds of that we’re about a trillion to one because there’s not a lot of Baháʼís. And although it’s higher than that in LA because producers you just have to walk down the street to find a movie producer. But still, it was a little odd I thought and I so it started me on this Odyssey three year Odyssey we started in 2015. And the movie came out in 2018. We shot it in Spain. We shot interviews in London, LA and Chicago and we shot the end of the movie right here behind me. We shot the last week. We shot our narrator right here at the shrine at the bottom. It was absolutely fantastic. And the movie came out. It was named the best documentary. We got a Wilbert Award for that in 2018. It was it’s been shown twice nationally on ABC. And we now have well over a half a million views on YouTube. So we are you know, I would say millions of people have seen the movie. Yeah.
Jeremy Weisz 14:48
That’s amazing. Why did you call it The Gate?
Steve Sarowitz 14:50
The bar means the gate. So the Bab is an app in Arabic means the gate and the Bab is actually the gate So from a Baháʼí perspective, and I think just from the perspective in general, the Bab was the gateway to a new age, when he declares on May 23 1844, changes the entire world. It’s very quiet. People don’t know about it. Actually, it wasn’t that quiet in Iran or Persia, he had over 100,000 followers, they, they jailed him, they ended up shooting him very publicly in his shooting, you’ll have to watch if you didn’t watch The Gate, right?
Jeremy Weisz 15:27
Part of it. Yeah, not the whole thing.
Steve Sarowitz 15:29
Watch The Gate again. And you’ll see about his shooting, it’s extremely dramatic. I’ll just say this, they shot him 750 times in front of a crowd of 1000s. And he disappeared. And this is very well documented. He told them before they took them that they couldn’t shoot him, he wasn’t done with his mission, they end up finding him back in a cell. He says, Oh, I finished my mission now. And they tie him up a second time along with the niece, who was tied up with him the first time also wasn’t killed. And they had to get a whole nother Regiment, and they shot him. So his shooting was very dramatic. His his, his ministry is also very dramatic, but not very well known outside of the Baháʼí Faith. But we believe he was the gate, nun to this new age. And also the gate to Bahala, we believe is really bringing the ideas for this new age to humanity, the idea of unity and oneness.
Jeremy Weisz 16:21
See, talk about your background, your wife’s background, because you obviously you said, you know, you started on this journey six years ago. And it’s gotta be something profound to change what someone’s you know, how they grew up their beliefs, and talk about where that started for both of you.
Steve Sarowitz 16:42
So my wife is Catholic, she hasn’t changed. I’m I was Jewish. My so my family’s been Jewish for you know, 1000s of literally 1000s of years. 19 members of my family were killed in the Holocaust. So I was told, even beyond being Jewish, that I would be trading my family if I ever changed religions, which is not really something I was even thinking of doing that deeply ingrained in me. And I’m to make it even worse, I named after my great grandfather who perished in the Holocaust, and named every name. He was smiling at Scott tsukioka. So for me to change religions was a big thing. It was a very gradual process. When I was in college, I first heard about the Baháʼí faith, I loved it right from the start, I really liked the idea, it made sense to me. It never made sense to me that the Jews were right, and the Christians are wrong, or the Christians are right and the Jews are wrong. I mean, the idea that there was only one God and he sent all the messengers, that just immediately when I heard that, that just made sense to me. But going from there from that, you know, hey, that makes sense to becoming a Baháʼí was a much longer journey. The next step is a friend of mine, when I was in my mid 20s, asked me to study the Christian Bible. And I had a Chinese restaurant the time he was a delivery driver, part time and full time, Pastor. And I said, No, I’m, I don’t really want to study the Christian Bible. I’m Jewish. And so he asked me again. And I said, No, I’m Jewish. And the third took three tries, but I finally agreed to study the Bible. And after a couple months, I’m like, Well, I kind of like this Jesus guy, I don’t know why I don’t believe and what does that mean anyway? What does it mean to not? Do I think he didn’t exist? Or do I disagree with something and I really didn’t disagree with what he was saying, as a Baháʼí , I kind of realized, and this is probably gonna sound controversial, but Jesus and Moses were the same person, essentially. So Moses and Jesus, their teachings are so incredibly similar, when you really go back to Jesus is quoting Moses, and all of his most important statements. And we as Baháʼí believe that all of the messengers of God are essentially one soul, and and that the teachings, the spiritual teachings are identical. And so I think, to be a good Jew is to be a good Christian, to be a good Christian is to be a good Muslim, and to be a good Muslim is to be a good Baháʼí . This idea to me is so much more logical. And, you know, the question I always have for people is, if we don’t think this way, how are we ever going to get to peace? Which look if we had peace? So the next, you know, would the world be better if we had world peace? I think so. And, and are we worshipping the same God? I hope so. And if we are doing that, why are we fighting? And are these you know, not these religious traditions. I mean, I love the Jewish religious traditions and my wife is Catholic. I respect the Catholic traditions, and I’ve been to mass many times, I have no problem going in and praying in a Catholic church or Jewish temple. No problem at all. I like to pray and I like to say, you know, to thank God no matter where I am, or say praise to God, I just don’t think we need to separate ourselves with identities that way. And that, you know, so many problems in the world. You know, Israel, Israel behind me, you got a couple problems there, based on a few Yeah, but not by foot, by the way, heifers, heifers, the chill city in Israel, and so is aka the places where the Baháʼí s are just coincidentally seem, seem to be a lot more mellow.
Jeremy Weisz 20:03
Thanks for sharing that. And I’m curious. So your great grandfather, my grandfather actually was a Holocaust survivor and your great grandfather perished in the Holocaust who survived from the family as
Steve Sarowitz 20:16
well. So my great grandfather sent some younger brothers over and he sent three sons over. And so my grandfather was one of the three sons he sent over. The younger brothers sent $10,000 to him to take the family out. And they put in the bank, the bank folded the next day, it was a very unstable time, financially, and so they they all perish, they couldn’t get out. It’s very, very sad that the actual the younger brothers were very wealthy. But they couldn’t do anything at that time. You know, they sent them the money, but they just couldn’t get them out. It was too late.
Jeremy Weisz 20:54
Terrible. I want to go back to your journey from your career. And even backing up from there, right. I mentioned 600 square foot. A couple staff know clients at the time, when you were growing up. What did you want to be?
Steve Sarowitz 21:15
Oh, I one point I wanted to be a baseball player. I wasn’t till much later. I wanted to be an entrepreneur. My mom wanted me to be a college professor. I don’t think I really wanted to be anything. I think I if I could have been a professional runner, I’ve always loved to run. So I just ran before this interview. I just ran about an hour or two ago. So I love to run. But I’m not good enough to be a professional runner. Unfortunately. I was always okay, but not good enough to be professional.
Jeremy Weisz 21:45
I read somewhere there’s you have something Hall of Fame in Chicago runners Association, or what is that?
Steve Sarowitz 21:52
Well, I’m I’m a very good big runner. So you can tell this from looking at me here, but I’m six foot six. So I’m, I’m one of the taller competitive runners you’ll ever meet. And for my height and my weight, I’m very fast. But the key thing is for 200 pounds, so like a 200 pound runners like a five foot two basketball.
Jeremy Weisz 22:12
Got it? Yeah, we just
Steve Sarowitz 22:15
were handicapped.
Jeremy Weisz 22:17
So take me back to the 600 square foot office. A couple staff know clients. What was the idea at that point?
Steve Sarowitz 22:24
Um, so I had worked in the payroll industry I got in 1989. I worked for a company called Robert FYI. And I didn’t even know what a payroll service was. And it wasn’t till years later, I found out my grandpa, one of my grandpa’s did payroll full time. But he never knew that until years later, I worked there as a salesperson for a couple years the company was bought out I sold I I then started a Chinese restaurant failed miserably.
Jeremy Weisz 22:48
Chinese restaurant, why Chinese restaurant
Steve Sarowitz 22:52
because of my ethnic background, Why else? Again, told me to leave the job that I wanted to do like Chinese food delivery, like, like Domino’s Pizza. Okay. That’s a long story. Well, we talked about that another day. But anyways, it just it was called Yin Yang. So I express that it was a colossal failure over time, but took two and a half years, six years for me to probably fail. And I’m sorry, six months for me to fail. And two years for me to to go on. beyond that. I’ve always been very stubborn. So I got back in the payroll business in 1994, as a sales manager worked for a couple companies. And in 1997, I started Paylocity, my accountant, I’d worked the last two companies that worked for the owners, it sold out for multi, they became multimillionaires upon selling their company and Mike accounts and you should do it for yourself. So that was it. Just go do it for yourself. So I did you know, little did I know that that would that that decision would make me a billionaire. I had no idea.
Jeremy Weisz 23:58
What were some of the milestones. So like, you know, from no clients, what’s the first milestone that you remember hitting for the company?
Steve Sarowitz 24:08
Well, our first client, which took almost, that took several months, we actually didn’t have revenue for the first few months. And the first milestone was getting the the payroll system to actually calculate a check properly. That took a couple months we It was a brand new system. And there were a few nervous days because we had we had put in this brand new system we’ve licensed and it didn’t work for a couple months. So getting the system to work helped a couple of big steps along the way. One of the biggest steps was deciding to write our own software. So this is about five years in, I think, okay, milestones along the way. The first time we made the Inc 500 is one of the country’s fastest growing companies that was big for us. And then the same year, we actually made the Inc 500 2 straight years 2003 and 2004. And those same two years we were also named the number one independent payroll company in the country by our industry group. So those things, kind of milestones along that same time, we’re hitting the size, and I was looking around and I was seeing all my competitors, and I realized up above $10 million in revenue, almost nobody licensed their product, they owned it. So I started thinking about that. And so we started writing software then, and that decision to write software, that was a very big expensive at the time decision. But it’s been, I mean, that has changed my life. And then the next milestone would be bringing in Steve Beauchamp, who’s the current CEO? I brought him in in 2007. I would not say that Steve is comparable to me as a CEO, because that would be a tremendous insult to Steve cookies. He and I both know, no, I’m not kidding. When I say this, he and I both know that he is 10 times the CEO that I ever was when he’s asleep. So, but we each have a lot of respect, we’re good friends, I have tremendous respect for him. And he respects me and understands that I, I think probably the biggest thing and respect is the fact that I acknowledge that I’m not a great CEO. And I become better over the years actually, I’m probably a much better CEO today. Or could be if I wanted to be than I was back then. But he’s just, he’s, he’s a naturally great CEO. He’s done a tremendous job leading the company. And he acknowledges that I’m a good entrepreneur, so it works out. And you know, it’s good that we kind of respect each other’s relative strengths.
Jeremy Weisz 26:28
I mean, it’s a different skill set. Right, Steve? So yeah, what makes him a good CEO? He’s,
Steve Sarowitz 26:33
he’s very strategic. He’s very thoughtful. He’s very even tempered. He has a he’s a ready Aim. Fire guy. You give Steve information, he goes and gets the information. He’s, he’s, first of all, brilliant. He’s got good intuition. Great logic. I mean, it’s really unusual Condon great integrity. I mean, just if you want to like look at what you’d want the CEO, just put put a poster of Steve Beauchamp up there, as far as I’m concerned, I think he should be winning awards is one of the best CEOs in America. I think he’s that good.
Jeremy Weisz 27:07
Was that a tough decision? I know, I remember reading it around 150 employees, you kind of made a decision that you needed a change? What What brought you to that decision? And would you have done it any differently? Would you have done it earlier?
Steve Sarowitz 27:22
I think I did it about the right time. It’s worked out very well, financially. I could have done it earlier. But I think doing it that time, I think it was the right time I took it as far as I could, I think had I brought him in earlier, I might have had regrets. You know, I didn’t. But by the time I brought him in, I knew I needed to bring him in.
Jeremy Weisz 27:42
And you know, like, tell me what were you want says,
Steve Sarowitz 27:45
I was physically getting sick. I was trying to run the software development area, the customer service area, operations and sales. You know, I had some good people too. But I had to be involved in every decision began. That’s nothing against the people I had running those areas, because mourn me not being as good a manager. And so because I was doing that I had two young children at the time. I was sick, and we had two lawsuits going on at the time and everything stress
Jeremy Weisz 28:18
thinking about thinking about,
Steve Sarowitz 28:20
yeah, I was, I was not sleeping enough. I was very stressed out about the lawsuit. So all the stress got to me, and my digestive system, my digestive system at that time, just kind of was blown up. So I went to doctors, and I was i’d also hurt my back. All of that was stress relief related. And so at the bottom of it, we hired Mike Haskett, who’s now president in 2007. And his first question to Steve, this is how bad I looked back then this is going back 13 years, almost 14 years, but 13 and a half years ago. My first question to Steve was, is he going to live? That’s why he was serious, too, because I was very pale. I just was, you know, my body was shutting down. And, frankly, had I stayed like that knows what would have happened. Maybe I wouldn’t have left. You know, I could have had other medical issues that would have come up. But I ended up going to a medical intuitionist right around that time. Hmm. And she diagnosed me and told me to take out gluten and dairy, and nuts from my diet, I found out that nuts in particular were really tough on me. And I didn’t know that I’d never known that. I was allergic to peanuts when I was a young kid. But then after that I was fine. And it turns out that it comes back around well, and once I removed those from my diet, I was much better much more very quickly and removing the stress out too. And then when I called Steve up, it’s a kind of a funny conversation. I I said, Steve, I want someone to come into this COO for my business because I need someone to help me. He says Well, I would only consider President i said i meant President.
Jeremy Weisz 29:53
How did you know Steve?
Steve Sarowitz 29:55
Um, so I’ve known him from the industry. And I told him always if I ever wanted someone To replace me, I’d call him I told him for a few years now, meanwhile, Steve didn’t care about this at all. And Steve will tell you this, if you ever have to. I mean, I gotta tell you that Steve, isn’t it. He’s wonderful. If you ever get a chance to interview him, please do. But he will tell you, he had no desire to come take over my little, tiny company at the time. I mean, we got along well, but that was he was doing great on his own. He had been president of a small payroll company, that company was bought out by a larger one, which in turn was bought off by a larger one, which was the second largest one in the world, which is Paychex and he was a Vice President of Paychex, he was making very good money, as well, he and his wife and four kids under six, were all doing very well in Rochester, his wife was happy. And to uproot them and come to Chicago was a big thing that he was not even thinking about. It just I got very lucky. I brought him in for an interview, I told him, he was my only candidate. And so he interviewed and he surprised because the company was about twice as big as he thought we were, he was even more surprised. And what really impressed him was our software product, he did not think that a little player like us could make a very good product. And we had, because that was really my forte was technology. And in addition to sales, I had a very good grasp of technology, much more so than most of my peers. And I actually did some coding, I actually wrote the prototype myself, which was very unusual. Well, and so I was very passionate about that. And the operation was much more solid than he expected. But that still wasn’t enough to convince them ends up going. The reason he even came through the interview is because Paychex have blown them out for a seminar they were having. So get seated at the same table as that as the Paychex salespeople for Chicago, and they said, Hey, Steve, you know, that tall, skinny crazy guy who runs Paylocity, you know, all the other they called us ankle biters. He said all the other ankle biters act this way. But you know, we can just crunch them. But we can’t do that with Paylocity, we keep losing to them in the marketplace. And Steve had seen our product, and he knew our product was just flat out better. And so he knew that what he saw was that we could replicate this all over the country, he and I had that same vision. And but I knew that he could, he could actually execute on that vision, whereas I couldn’t. And so we work together side by side for the next few years. with Steve taking over more and more, he pretty much ran the company from day one. But I took I was running software development for a while. And after a couple years, I gave him software development. And then we actually were moving on to the new product. And so I was very involved in that for the next couple of years.
Jeremy Weisz 32:37
Steve for after that meeting that he heard the Paychex people talking about philosophy, and what point does he call you and say yes, or how does it actually come to you? Yes.
Steve Sarowitz 32:48
I think within a few, his wife had to come out. If you ever interview Steve, Steve will tell you that I almost blew it. You know,
Jeremy Weisz 32:59
what did you do?
Steve Sarowitz 33:00
I think we picked her up in an old Paylocity. I think I sent one got somebody to pick her up like and she’s you know, it wasn’t we didn’t exactly wine and diner. But then she saw my passion. And she realized I was a pretty bright guy. And I think Steve, Steve will tell you I almost blew it with his wife. But she’s, she’s great as well. It was within a week or two. He what he saw that it wasn’t just the meeting, he really saw the potential for the company. And I think he could see the vision of where we are today. back then. 13 and a half years ago.
Jeremy Weisz 33:34
Yeah. You know, I remember listening to one of the talks you gave Steve, and you kept saying and really hitting on competitive advantage, competitive edge, competitive edge, competitive edge. And one of the things is the software. And in the beginning, you licensed the software in the beginning, which, you know, it seems like a smart move because it saves in costs. It’s probably speed to market, and then you decide to create your own. And you talked about being profiled, but profiled. I think it was in Forbes for the wrong reasons. Inc. Magazine, Inc. Magazine, Inc. Magazine.
Steve Sarowitz 34:08
I would love Inc to do a follow up. You’re talking to people, I think I’ve waited now for all these years, we have to do that. So Inc Magazine wrote this thing and said, you know, and it was funny because the experts weighed in and basically said I was a moron. And I was very proud of the decision because I put a million dollars into the product. And I immediately said, well, not immediately I actually we analyzed it. And I and when I once I heard that the product we put in a million dollars into wasn’t going to be great. And I said stop. Well, you know, I basically asked my new head of development, should we start over or not? He said start over and I said, Okay, do it. Well, I didn’t hesitate. And I thought it was a really good decision. And the results I think speak for themselves. I mean, the company being worth I think over $11 billion today and it wasn’t worth that much then I mean, it really wasn’t worth anything that, um, I think we made the right decision. And so yes, if we lost a million dollars, but I think we made a good decision,
Jeremy Weisz 35:08
I think the proof is in the pudding
Steve Sarowitz 35:10
Inc Magazine, I can do a follow up, you know, I
Jeremy Weisz 35:14
mean, they they talked about wasting a million dollars, but but really when you, it sounds like you’re like, we have to go back to the drawing board, you used everything you learn to build a better product, it sounds like
Steve Sarowitz 35:25
we did. We did use everything we learned. And I learned biggest thing is just, you know, hiring the team, I knew who to hire what I was looking for. I had never built software before. So it’s, it’s not unusual to fail software is hard to build. And there’s a reason why these you know, people say these tech entrepreneurs are lucky. No, they’re pretty darn smart. It is hard to build good software, you know, so I can tell you now, I mean, I have challenges. Every company building software, even though I’ve done it, you know, in blue marble, we have challenges with our software. And I have a really good team, but it’s just it’s a hard thing to do. What was the right, time to do it?
Jeremy Weisz 36:02
Yeah. Steve, what was your identity? Like when you bring in a? He was a CEO at the time, right. Steve was the CEO or president?
Steve Sarowitz 36:14
I was CEO
Jeremy Weisz 36:15
you were CEO. He was president. What did you know? What was your identity? Like? Because you’re used to so just working around the clock doing everything? Was that hard for you? Was it not hard for you? What did that look like when you bring it brought in the president?
Steve Sarowitz 36:30
I was happy to bring him in again, because I was sick at the time. So I needed it. I wasn’t. And that’s why, like I said it might be a couple years earlier, I probably wouldn’t have brought him in a couple years earlier, because, but I realized I needed him. So it was surprisingly easy. Steve and I and we’ve been working together now for 13 years. I mean, technically, I don’t work there anymore. And we don’t work together. But I’m still Chairman of The Board. And we’ve had one time where we were mad at each other. And, and you know, maybe I can’t speak for Steve, he might have a little few more times. But we actually, you know, when he left Paychex, and they heard where he was going, they literally thought he’d gone insane. And they told himself, they were not shy and telling him that. And if you think about it, it makes a lot of sense. Here he is leaving an excellent job with you know, already making great money, great career track, potentially going to be CEO of this beautiful, multi billion dollar company and is going to this little company, and the entrepreneur is still there. What what made it Okay, as I was prepared to give the reins to Steve, we had a little bump in the road a few years later, Steve wanted to be CEO, I wasn’t ready to give up the title. And I remember I was at a meeting, if you heard of YPO. Yes. So I was at my YPO meeting. And I said this, and one of my friends are still my friends still on my forum says to me, so let me get this right. Your CEO and he’s president. And he wants to be CEO? And he says, Well, you know, are you a good CEO? No, I’m terrible. To see a good CEO. Oh, yeah. He’s a great CEO. And he’s doing all the work of CEO. But what do I do if the CEO he said, Well, you could be Chairman and Founder. And then the CEO still reports to you? Because you still own the company? Right? Like, yeah. Okay, so he says, You are gonna name him CEO. And so I went back, and I said, named Steve CEO, and he was very happy. And, you know, Steve’s point to me was, well, who would hire you as CEO? I mean, I’m a CEO. And this is good for my resume. And just in case anything happens, I should be CEO and get credit for the work I’m already doing and like, yeah, yeah, you probably should. But he’s very happy with, you know, what’s happened. He’s worth a good amount of money himself. Now, he’s not a billionaire. But he’s, he’s very wealthy. Now. He’s done very well. And I think that it’s safe to go back to those people with Paychex, who said he was crazy. And hopefully, it can convince him that he was only half crazy. So ink
Jeremy Weisz 38:58
and Paychex, you know, things turned out. Yeah. And Sean McGinnis on who was I think he was president of YPO. At one point, I don’t know if you knew him. But talk about some of the lessons learned going public. Well,
Steve Sarowitz 39:16
hire a good CEO and let them do all the work. It’s interesting being chairman of a public company, you know, I can’t say too many things. But I was already CEO of a company of a decent sized company. So you know, as a CEO, there’s things you cannot say. And so it’s interesting to me. I just had a talk with an employee today at Wayfarer. And he said, I bought some Wayfarer, I bought some Paylocity stock. I said, that’s it. I’m not talking to you about Paylocity I have a really hard and fast rule. You know, I don’t I tell all my friends don’t buy Paylocity stock. my really good friends or partners because I don’t really want to be in a position where if you make money, someone could point it back at me.
Jeremy Weisz 39:59
Right? Right.
Steve Sarowitz 39:59
I just make money somewhere else. I’m very, very careful about that. So I’m very, very careful about talking about the company. Luckily, I don’t work there. So I don’t have that much knowledge anyway. But as a big insight holder, I have to be very, very careful. And I think that I think it’s good that there’s very strict rules about that, because I don’t want to, you know, have my family and friends make money because of something I know, you know, look, you know, they want to buy Paylocity stock they can, I don’t want to hear about it. And so that’s the biggest thing is that I just, I just feel that insider trading I’m, it’s something I’m really cognizant of. The other thing that it made it very difficult, is now I have blue, I’ve started Blue Marble. And so I had to be very, very careful with related companies. And you know, still it’s, that’s an issue if I were to sell Blue Marble Paylocity has first dibs if I were to sell blue marble. So I just have to be very, very careful to do everything aboveboard. And the most important thing to me is that I do everything ethically. And that never, never Paylocity. And as chairman, that’s very important,
Jeremy Weisz 41:10
when you, Steve, when you kind of stepped down from responsibility in day to day work with Paylocity. What was your next venture? What did you do next? And how much time did you leave?
Steve Sarowitz 41:24
Blue Marble, so 46. So I’m 55. Now, when I was 46, going back nine years, just under nine years ago, I went to Steve and I said, Well, Steve, you know, I don’t have to work. You’re doing all the work here. I’m pretty much done, you know, you’re paying me a paycheck. But that doesn’t matter. And I don’t need money. So what can I do? He said, Well, why don’t you start an international payroll company, we’d had a bad experience working with international payroll, there wasn’t really a good international payroll company out there. So that we could put a point to at that point. And so we decided that Steve said, you’d be good at that. Start your own. Because I wanted I said, what kind of company should I start? And so he said, Well, international payroll, there was a couple different types of ideas I have, but that was the one that I thought was the best. And so I started this in basically right around eight years ago, very beginning of 2013.
Jeremy Weisz 42:18
How much time did you give yourself to take a break? Or did you first of all, next
Steve Sarowitz 42:23
thing, I kind of already taken the break, because Steve was caring most of the way that Paylocity so that, you know, at the time, I was probably paying playing Scrabble a couple hours a night I was bored. I wasn’t at Baha’i yet. So I, if I’d been up behind it just spent two hours reading behind books every night, but I was already kind of going for me going much easier. And so and even when I started Blue Marble, it wasn’t a lot of work. I never have put that much work into Blue Marble, Blue Marble has actually been a pretty good success. We made the Inc 5000 list, which is nice. And we are we’ve grown pretty well, we’re actually going to probably do 17 $18 million this year in revenue from gratulations. In 2017. We did 1,000,005. So we’ve grown well, wow. It’s another successful company. But I won’t take a lot of credit, except for the fact I think Blue Marble is more innovative than Paylocity was. It’s more it’s more unique and what we’ve done in our vision, but I probably could have put more time into the company.
Jeremy Weisz 43:26
What were some things you did to grow Blue Marble, knowing what you knew from paylocity?
Steve Sarowitz 43:33
Well, I think with Blue Marble, I had more money to grow it so I was able to invest in sales, I wasn’t able to invest in marketing in a way I couldn’t. With Paylocity. Same thing with software, I was able to start building software day one. So part of is just having a lot more capital. Yeah.
Jeremy Weisz 43:49
I mean, some people, I could argue if you gave them the money, they wouldn’t know what to do with it. So you deployed it in a very smart way. What are you doing with sales and marketing?
Steve Sarowitz 44:00
I would tell you that. And Steve Beauchamp would tell you this, he looks at me in 2017 occurrences, what the heck are you doing with your money, you’re throwing good money after bad. Between two my first five years in business, I managed to get to a million and a half in revenue. And we were losing four and a half million. Now this year, we should make money on our 17 or 18 million. So it’s a little different. But going back just a few years ago, we had you know we were coming off. So we had $6 million in costs in a million and a half in revenue. That’s not so great. So it really depends on when I kind of I watched the story of Pixar. And I think I kind of did what Steve Jobs did was I kind of had faith that the business would come around. That was probably the biggest thing I did right is I was patient. And I said I know this is a good idea. I know if we do it long enough. It’ll be a good idea. And so I held on, and I knew that at some point in time people would realize what we were doing and I hired a Victor Lobo has been running sales in the last several years. He’s our VP of sales and a personal friend. Actually, it i’d hired him previously in Paylocity years and years ago, and then he left us and went to work for ADP, because we not because we actually wanted to leave but because he left and went to San Francisco. And we at the time didn’t have, we didn’t have a position for him in San Francisco. So he, he left ADP and came in came in and started running Salesforce. And he he figured out that we needed to put more money into marketing rather than into sales, well, into marketing and sales. And so that marketing push that he that he put in really helped.
Jeremy Weisz 45:44
What does that look like?
Steve Sarowitz 45:46
So marketing, what we needed to do is we needed to have people calling us international payrolls, not as big as a domestic payroll, domestic payroll, you can walk down the street, and there’s 100 people who need domestic payroll, international payroll is much more spread out, it’s harder to find clients. And in a sense, you have to have them finding you. And people didn’t know we were there. So we did a lot of SEO, we did a lot of ads and things like that to start, because people needed to know because it was too hard to find that. And once we started doing that, that really helped.
Jeremy Weisz 46:22
who’s an ideal customer for Blue Marble?
Steve Sarowitz 46:25
Someone with probably 1000 employees, and maybe, you know, 150, or 100, international employees, maybe 510 countries. Some, I would say, you know, not IBM or or Google or Microsoft with 10s and 10s of 1000s of employees, you know, we could do we do have clients with five or 10,000 employees or more. But typically, I would say, with between 50, and maybe a couple 1000 International employees is really our sweet spot.
Jeremy Weisz 46:59
Is there a certain industry that it tends to skew?
Steve Sarowitz 47:03
I would say, actually, on the low end, maybe even 10 or 20, international employees, we we always work going for more than mid market of international. So not the not the biggest and not the smallest,
Jeremy Weisz 47:16
like manufacturing type of companies. And what’s a common company
Steve Sarowitz 47:20
that has we don’t have a we don’t have a concentration. It’s spread out on many, many industries.
Jeremy Weisz 47:27
Got it? Okay, awesome, Steve. First of all, I have one last question or two to like kind of a subset. But two last questions. But thank you. First of all, thanks for sharing your journey. Thanks for sharing your stories is just a tremendous journey from religion to movies, the business of philanthropy, and I really appreciate you sharing your knowledge and expertise with us. And people can you know, check out BlueMarblePayroll.com? And is what’s the the URL for the Wayfarer Studios? Where can people check out the movies?
Steve Sarowitz 48:00
I think it’s we are Wayfarer.com. But don’t hold me to it. Okay, you can google wayfair Studios, I
Jeremy Weisz 48:06
should know that but Wayfarer Studios and you know, check out Clouds, The Gate and some of the other works that they do. Last few questions. Steve is really I always ask since since inspired insider what is what’s been a low moment, a challenging point in this journey. And then on the flip side, what’s been a high moment like and especially proud moment for you on the journey.
Steve Sarowitz 48:31
With Paylocity, early on, I had a partner and I had to fire my first partner that was a really tough, challenging time is very early in our growth. And I wasn’t sure the company was going to survive. On one room I had bankers in there’s only a two room office was 600 square feet. And the other room I had my network consultant frantically trying to break into our computers because my my former partner had locked me out. Well, our own network, they worked out okay. And I ended up buying him out. And so it wasn’t but it you know, sometimes things seems sometimes things seem a little darker than they are. I’ve learned over time. You know, the lawsuits was another low moment I having these two lawsuits going on. One was a trademark lawsuit. And one was a software they sued. They sued us for software infringement, which we had not done. And we ended up I tried for six months to get a hold of the CEO of the company and finally gets a hold of me and he says, I need this much money. And I’m like, Okay, sure. And then we hired a consultant to come in and do an audit. And at the end of this as much ado about nothing. And I knew that but it was really hard and frustrating. Because all he had if he had just talked to me six months earlier, we could have just resolved this and I could have said Look, I’ll pay for an audit. We didn’t do what you think we did. And I proved it and I was willing to prove it. But so that was kind of tough. Yeah, I’m high moments. those first couple real successes in Paylocity Clouds is a high moment. Getting a Wilbur for The Gate is I’m going public was a high moment.
Jeremy Weisz 50:11
What about your wife and your foundation for time for their big talk about some of that?
Steve Sarowitz 50:18
Well, there’s some really high moments and I haven’t talked a lot about philanthropy. Let me talk a little bit about, you know, my philanthropy is all about him. So there’s two types of Philanthropy In my mind. And then there’s more than this, but I’ll give you one is the band aid philanthropy you cut yourself, if somebody cuts themselves, you say, oh, here’s a bad day. And then they cut themselves again, you give me another band aid, and rinse, repeat, and you just do that non stop. And so if I’m merely helping the poor, but not understanding why they’re poor, I’m merely helping the orphan, but not understanding why they’re orphans. That’s band aid, philanthropy. Sounds good. And it’s a good thing to do. Because look, you know, it’s always good to help your fellow man. But I want to know why people are poor. I want to know why there’s inequity in the world. And as a Baháʼí this is really where my Baháʼí beliefs come in. I believe that these divisions that the high faith is fighting, racism, and sexism and nationalism, religious prejudice, are underlying all of the major problems in the world. Poverty being a big one. And so my wife and I focus a lot on education. And so our Family Foundation, which is the Julian Grace Foundation, no, please don’t call us because we’re, we don’t accept outside because a second I say, have a foundation, sometimes we get a flood of people. But our foundation, We’ve helped over 100 nonprofits. And and we do a lot of work in education, we do help orphans, we do help foster children. But a lot of what we do is trying to eradicate racism and sexism. We work with a wonderful group that helps women, refugees, female refugees, so we have different organizations that do different things. The idea being that we’re trying to get to the root cause wherever possible. And then the last year, I’ve broken off a little bit of my giving outside my family foundation, which I’m now going to do through the Wayfarer Foundation. And all of this is 100%, Baháʼí inspired not all the high organization. So for example, we’re giving to one organization actually multiple organizations that fight racism, which is a Baháʼí thing. But it’s all with theBaháʼí ideals. And a lot of it has to do with it’s a combination of philanthropy and and the Baháʼí Faith.
Jeremy Weisz 52:36
Steve, thank you so much. I’m gonna do the first one a thank you check out all the you know, Wayfarer Studios, check out BlueMarblePayroll.com. And more interviews and Rise 25. Steve, thanks so much.
Steve Sarowitz 52:50
It’s my pleasure, always happy to talk about almost any subject you want. And I highly recommend if you get a chance to interview Steve Beauchamp, interview him as well. He might be harder to get on than me
Jeremy Weisz 53:01
I’ll just ask his wife.
Steve Sarowitz 53:04
Oh, and check out make sure you check out Man Enough, which is my partner, Justin’s book that’s coming out. huge thing. It’s examining his masculinity. It’s going to be an international bestseller. It’s already come out the pre sales. It’s going to be big. So you’re going to hear about it all over Okada telling you about it now it should be coming out in April. He is he’s we’ve already got a TV show called Man Enough. But this book is going to be huge. man enough something. It’s something that’s really important. How do we men out of me and you and other men survive in this new world where women, for some reason think there are equals that we’re supposed to? You know, what am I supposed to do in this new world? How do I become, you know, am I a macho man still? Or am I do I am I you know, do I have to give up all my masculinity, you know, how do I survive? And it’s really trying to balance in this new world what we’re supposed to do, and it’s a very important book. And I think I think Justin is amazing.
Jeremy Weisz 54:06
Everyone check out Man Enough. So right now, it will be out in the near future. Maybe when you’re listening is already out and I’m sure they can check it out on Amazon.
Steve Sarowitz 54:15
It’s pre sales right now. That’ll be out I think in April. Okay,
Jeremy Weisz 54:18
Man, enough. Steve, thank you so much.
Steve Sarowitz 54:23
Have a wonderful day.
