Tamir Shklaz: Incubator (EF & YC) Value, South Africa Tech Landscape & Benefits of Slowing Down - E152

· Start-up,Founder,Singapore,Middle East and Africa,Podcast Episodes English

And there’s one quote that colors a lot of my perspective of life; which is to say you grow at the edge of your comfort zone. So if you’re not challenged. If you’re comfortable, you’re not growing. It’s when things are bloody scary when you feel like you’re borderline drowning and you somehow find the way to swim through. That’s when you grow. That’s when you learn. I was like, OK, I’m scared of this decision. I’m scared of doing this ‘cause it’s going to make me uncomfortable as hell. OK, let’s do it.-Tamir Shklaz

Co-Founder and CTO of Strive Education (YCS21), teaching K12 math through code via live 1:1 online classes. Tamir is a 3x startup founder, namely Quillo South Africa's largest online 2nd hand textbook marketplace and Insupply, where Tamir worked with the South African presidency to get PPE to front line workers during the COVID-19 pandemic.

Jeremy Au: (00:30)
Hi, Tamir, welcome to the show.

Tamir Shklaz: (00:33)
Thank you, Jeremy, looking forward to being here.

Jeremy Au: (00:34)
I’m excited because I got to know you at Entrepreneurs First and it’s been awesome to see you as a serial founder and joined the YC batch. Very excited to talk about your journey over the past few years.

Tamir Shklaz: (00:50)
Awesome. Looking forward to chatting about it. It’s crazy to think how EF was just a few months ago and how much it’s changed since then.

Jeremy Au: (00:59)
Tell us a little bit about yourself.

Tamir Shklaz: (01:01)
I’m originally from South Africa, born in Johannesburg. I’d say my story begins with competitive gaming. When I was younger, that pushed me to get interested in computers in order to improve its performance so that I could be a better player. I learnt that this computer stuff is pretty fun and you could do some pretty cool things with it. So, I went into computers because my parents wouldn’t let me game for a living. I studied electrical and computer engineering at the University of Cape Town. Two years in, I started a startup out of frustration with the university and feeling that I wasn’t learning a lot. That startup was a big inflection point on my life, career, and my outlook.

Jeremy Au: (02:07)
Awesome. What games were you playing?

Tamir Shklaz: (02:09)
Call of Duty 4.

Jeremy Au: (02:13)
What was your favourite loadout?

Tamir Shklaz: (02:18)
For those listening, it’s Call of Duty 4, there were very few loadouts. I liked playing SMG – AK47U.

Jeremy Au: (02:36)
You decided to be an engineer instead. What made you choose that?

Tamir Shklaz: (02:45)
Yeah, I guess so. I wasn’t sure what I wanted to do. I had no idea what I wanted to study at the time, and this seemed like a good bit because I was just studying computers for fun. So just programming different things in C++ and Java, just because it was cool. And I was like, OK, if this can turn into a career and I’m enjoying it, let’s go for it. And as well, the general thing was like engineering seems to be quite flexible. So half of my class ended up going into consulting, which has nothing to do with engineering. So I guess the flexibility of engineering appealed to me at the time.

Jeremy Au: (03:13)
While you were at university, you were entrepreneurial. Tell us how that got started.

Tamir Shklaz: (03:17)
I remember when I first arrived at university, the experience I had trying to find textbooks was a nightmare. So I arrived in my first lecture. My university professor told me I needed these three textbooks and a quick Google search showed me they’re going to cost like 1000 Rand plus, translating that to like roughly $100 and I was broke. How on earth was supposed to afford this? I tried second-hand platforms. I tried notice boards and it just wasn’t a fun experience. My thought at the time was this is my experience coming from a position of privilege. I was in a very lucky position where my parents were able to sponsor me to go to university, which isn’t the case for most students in South Africa. If this was my experience struggling to find textbooks, what is the experience of 99% of other students? So that was the experience I had, and it took until my third year of university that I didn’t feel like I was learning enough and said let’s try to build something. I had this idea of trying to solve this problem that I had in first year, so I built a second-hand Facebook marketplace that connected buyers and sellers. Built it with some of my friends and it was just some of the most fun I ever had just building it for that month. It was like that classic - stayed in a house together. We did nothing but sleep, eat, drink coffee and code, and then we release this thing and got like 2000 downloads in the first day or first week of it launching. We sold something like 500 textbooks and just helped a lot of students and I just became completely addicted to that process of ideating problems and building solutions quickly towards it. Then it was like I wanted to drop out of university. I was convinced. OK, cool. Mum, dad, Mark Zuckerberg. I’m coming for him. Don’t waste my time with this stuff. Luckily, my parents were a little bit more pragmatic. Please finish your degree, which I’m very grateful. I did eventually listen to after many long conversations and yes, finish the degree. But my university experience was very much colored by my experience of building Quillo, which eventually scaled over the two years to be the largest online second textbook marketplace in South Africa.

Jeremy Au: (05:18)
Amazing. Why do you think so many people want to drop out of college the moment they have some entrepreneurial success?

Tamir Shklaz: (05:29)
I think it does take a certain type of person ‘cause I started with three other friends and they were like, I want to focus on my studies. I was like, I’m getting out of here. But I do think it ends up being quite common. Honestly, it’s just this one, much more exciting. In university, you’re sitting there, you need to study for exams, write essays, whatever might be. Where as this other thing of work. You’re creating something and that something has an impact on somebody else. It has this real world, tangible output, and there’s potential. You’re always seeing this upside and I think being a first time founder, you’re naïve to how hard it is. So you’re overly optimistic to be like, oh, Mark Zuckerberg did this. Name entrepreneur X and you don’t realize the sampling bias or the survivor bias that exists there that you’re only hearing the stories of success, and so you’re going to assume you’re going to be successful. You don’t think, OK, this is going to be a long, hard journey. Knowing what I know now of like entrepreneurship, I’m very happy I ended up sticking with my degree. It was certainly the more pragmatic and wise choice.

Jeremy Au: (06:30)
What would you advice students listening to this podcast right now who are thinking of dropping out and becoming a founder?

Tamir Shklaz: (06:44)
Yeah, it would highly depend on your finances 99% of the time. Don’t do it. I think it’s a simple concept. 99% of the time it is just not worth it. The risk that you take because the university is expensive and it’s tough to go back from a financial perspective from every angle. It’s a tough decision to go backwards and it really is something that just gives you the safety net. One thing I’ve really learned kind of doing this is - It’s scary if you don’t have a safety net, you’re unable to think creatively. You’re unable to take the risks you need to take as an entrepreneur if you feel like these risks will end up with you, like losing your job, not knowing where you’re going to sleep at night, those aren’t the situations where you’re productive. Those situations where you make amazing things. It’s really in situations we feel relaxed and comfortable. So I think having a safety net is such an important thing. If your product and some magical thing there is always gonna be 0.01%, it just takes off and it works, but it’s always impossible to know. I don’t know. I think 99% of the time don’t drop out. Finish your degree. Make sure you’re stable and then look at pursuing entrepreneurship afterwards. You’re young, you’ve got your whole life ahead of you.

Jeremy Au: (07:50)
You have your whole life ahead of you and you’re working in Quillo, then you shifted to Southeast Asia. Talk us through that.

Tamir Shklaz: (08:04)
This all happened in the space of a year and a half, not even. 2020, I think for most people and for the world was the craziest year ever in the sense of a pandemic, but also for what it kind of translated for more pragmatically or more realistically for me. So 2020 was the year I graduated. I finished electrical, computer engineering and I was like, cool, I’m free. I finally listened to my parents. I’ve got a year of 1 runway where it’s gonna run with Quillo. Oh, I’m gonna do all the things I’ve always wanted to do with it and two months in, worldwide pandemic COVID, everything shuts down. And so students weren’t at university. So all of a sudden, the core value proposition that’s going for just wasn’t being used. People don’t need textbooks if you’re not attending university. And I had an idea just as people were talking about it more and more. I just saw like this idea, which was people are really going to want to know the statistics people are really going to want to know how many cases are there, how safe is it to go outside? There's also just a lot of disinformation. People had no idea. I remember when it first came out with some of those things like drinking soap was like this could cure of coronavirus or taking a hot bath. There's a lot of dangerous and fake news. So it’s like, OK, there’s a strong demand for these statistics. There’s a strong demand for like authentic news. So I decided to get together with a friend, be like, hey, let’s border like a weekend project. I literally sent him. There’s a Rick and Morty episode. They build an app, cherry on this alien. And like, there’s a famous meme. It goes like, do you want to build an app that was literally the meme I sent? And that meme changed my life because we ended up building this thing, and this went even more viral than quillow within the first weekend, we had more than 500,000 website hits and all of the sudden, news journals and articles just starting to reach out. So we interviewed by BBC every News Journal in South Africa and it became like the de facto place for information for COVID. Pandemic. So I had this really exciting project in the form of what was called Corona app and then Quillow which I thought when this all comes back and settle down and be able to come back to. And so I put 100% of my energy head down into Corona and I really thought this could have a really positive impact on the community around me. I started working on that two or so months and a lot of crazy stuff. I’ll skip over the details. I get approached by a project with the South African Presidency, so that’s African Presidency set up a lot of these tech projects to help use tech in order to just help the country in whatever ways. So there was one on, like track and trace or tracing people who are sick and trying to get the people around them to quarantine. I was approached to ask, hey, kind of the project manager. For hospital research, the idea was if a hospital in Joburg was doing something, could we get the hospital in Cape Town to know about it? If they need this particular piece of hardware, how can we get this piece of hardware that’s over here? So ventilators, masks, PPE, etc. Can we get them over there? People were doing all kinds of hacky stuff, so it’s really to like. Rally or community around that and I just said yes, I was like, Oh my goodness, working staffing presidency. Let’s do it. So then moved on to this project and it became apparent that the biggest problem was a huge PPE crisis. So the PPE supply changes completely collapsed because all of a sudden you had a 10X demand for gloves, masks and other things. And the existing supply couldn’t handle it. Hospitals and doctors would have one or two suppliers that they would usually trust, but now those supplies didn’t have, and so they wins elsewhere. But there was no system in order to verify if PP was, these sellers were legitimate, and there were horror stories, horror stories, millions of dollars that people gots camd. Have heard of a guy that spent $20 million on masks, other equipment. He arrives at the warehouse to come and collect it. The first few layers or masks or actual equipment and the rest are just newspapers, $20 million worth. PB was being delivered and transported by armored vans. It’s like it was more valuable than gold, so that became apparent. And then I was like, wait. I have this experience. I know this sounds like a marketplace problem. You have buyers and you have sellers and you need some sort of way of connecting legitimate sellers to limit buyers. Having the experience had with colors like OK, I know how to set up a marketplace quick. So I did that and that started going just an incredibly exciting but very stressful time. And over the course. End of two months working on that project, we delivered thousands of PPE items to frontline workers by actually connecting them to legitimate suppliers. Yeah, that would be my kind of 2020. I’ll pause there for a little bit.

Jeremy Au: (12:22)
How did you end up in Southeast Asia?

Tamir Shklaz: (12:24)
In the background of all of this, rewind to 2019 December I was in Johannesburg visiting my sister. I was working on Quillo and I finished breakfast with my family, and then I was like. I need to go to a coffee shop and do some work, so I went to this one coffee shop and I saw this one guy who was sitting on his laptop coding and I looked at it. I wanted my coffee. I’m in and sat down. I looked up again and I was like, I’m just trying like readers code and adventure. I started feeling quite creepy. I was like, I’m just gonna ask this guy like, hey, what are you building? So I just went up to him and spoke and say, what are you building? And that conversation very similarly, it was probably the most pivotal like introduction I’ve ever made, because then he told me about this program called Entrepreneur First, that he was a part of and just sounded incredible. You go to Singapore, do entrepreneurs, speed dating with a lot of other people, a little bit of context. The biggest struggle I had kind of throughout all of these projects was that I was alone which is exhausting. It is really, really exhausting. And so this idea of finding a cofounder is really high on my priority list. And this just sounded like the place, just incredible people looking to do something at the same time and a network of support. So applied for the program, got into the program that started August last year and that’s how I ended up in Southeast Asia.

Jeremy Au: (13:47)
Amazing. What was your experience like at EF?

Tamir Shklaz: (13:52)
I think. Incredible. In one word, a couple of feelings I could talk about was the biggest one. I remember. Impostor syndrome. I think you were a person three or four that I spoke to. And I’m just. How am I having these conversations? So as the youngest one in the group, I know there was one, Foo. So me and Foo were the two youngest. And I just finished out of university. Everyone else there is like. MBA at some big name Stanford, Harvard or has a PhD in Nano Robotics or AI and everything else in between or like veteran startup founders that have sold before or exited the company. It’s like how am I here? How am I supposed to ask someone be like, hey, I deserve 50% of any company we start. So I remember that feeling very...I’m a strong believer in the saying. It goes. You’re the average of the five people you surround yourself with. So you raise to the quality of the people around you. While this feeling was scary, it was incredible because I knew that just like through osmosis or whatever it might be just by being around these people and holding myself to the standard and pushing myself, this would be how I would grow, and that was certainly true.

Jeremy Au: (14:55)
What advice would you have for people who are thinking of joining programs like Entrepreneurs First?

Tamir Shklaz: (15:03)
I’d say do it. It’s a truly incredible program. It relates back to what I was saying previously, like not being in a position where you have to make this successful. If this doesn’t work, everything else collapses. ‘cause, you can’t think creatively like that. Programs like Entrepreneur First and Antler do create that safety net. So it’s like you’re getting paid even if you come out of this and it doesn’t work. You have an incredible network and just further opportunities. So it’s really an incredible program from that perspective. If you’re interested in entrepreneurship, this is a fantastic entry to do. So my advice would be apply. To get in, work hard. I guess that’s a much longer conversation on how to actually get accepted into other programs, so I’m trying to think like what was the thing that maybe for me got me in? I don’t even know. I think it was because of my previous startup experiences. There’s so many different ways. I think that’s I think there’s a million different ways from so ES has that classic thing. Of domain experts, catalyst and maybe industry. I think for people and maybe you have existing jobs, it’s like understanding that after a certain period of time like you do actually understand that industry really well. And so you have the potential to find someone who is a little bit more, I suppose, not an entrepreneur, but has that just let's get this done kind of attitude. Maybe someone with a fresh mind. So kind of that pairing does work. So it’s about that confidence knowing that you do have that experience above and beyond that argues about doing stuff and building stuff. So create things, create side projects speaks, you get involved in different things. I think the more kind of experience you have creating stuff the better. And then I think the biggest ones you just apply I think too many people, way too many people think or just don’t think that they’re good enough when in fact they are and there is zero harm. There is absolutely 0 harm in applying and you actually learn a lot in the process of applying. You learn a lot about OK, what are the things that they’re looking for if you go through the process and then speaking to people be like, hey, I’m looking to apply, can you help me out? People want to help out if you’re able to speak to an alum that’s gone through it, they’ll help you. So that process of even just applying is useful in and of itself, even if you don’t end up getting in.

Jeremy Au: (17:18)
Yeah, that’s really good advice. What do you think about the equity stake that Entrepreneurs First takes in a company and how would you advice founders to think about it?

Tamir Shklaz: (17:44)
Something interesting from my initial perspective and this is as well. For context, I suppose South African venture capital because I never knew how small of a market it was until I came to Singapore. So this idea of getting 65,000 like this stock investment is 65,000 US 75,000 U.S. dollars for 10% in South Africa. That is a great deal that is fantastic. If you can get $75,000 for 10% is some of the investments offers I was getting at previously was 200,000 Rand for 20 or 30% what’s at 20 thousand, $30,000. So the scale of the market and I suppose the perspective you’re coming from plays into that. So initially it wasn’t a thought even as I started going into it. And in speaking to people from different perspectives. A Silicon Valley perspective Singapore perspective then I’m sorry, that’s OK. This is actually quite a large chunk of equity that these guys are taken. So for example, now at YC like raising 10% or giving away 10%, we could be looking at anywhere above $1,000,000. So the change 75,000 to a million for the same amount of equity, it is a big change. Having said that, however, the price of a co-founder is invaluable again and again that 10% for finding pockets. My current cofounder, it’s a no brainer this wouldn’t exist without him and it was the primary reason I ended up moving. It is a lot of equity for a small amount of funding, but within the context of finding someone that you can build and go on this journey with. Worth it every time.

Jeremy Au: (19:09)
Great. Worst case scenario, you get a stipend. Best case, you get value for meeting new people and brainstorming ideas. Wrapping things up here, Tamir, can you tell us a time when you had to be BRAVE?

Tamir Shklaz: (19:39)
The bravest really would be the move to Singapore. Or like, maybe brave brave is a strong word, but the hardest decision I made was moving to Singapore in a couple of things. So Insupply was going. I had the choice to carry on going with Insupply. Had this traction, had thousands of like interested buyers. Hundreds of suppliers on the marketplace and. Initially, if you go back to some of the interviews they was talking about creating like the Alibaba of Africa, connecting African manufacturers to the global market, and I got really interested and passionate about that idea. And then I was thinking, OK, I’m going to move in the middle of the pandemic to a country I’ve never been in knowing no one there to this program that I’ve heard is OK to start. Something new? Going through that thought process was daunting and like I had a full on pros and cons list kind of going on either side and I think it comes down again to this conversation of a cofounder. if I spend the next five years building Insupply, I'm doing it alone. It’ll maybe be able to hire people and get a team, but it’s not the same as having a thought partner. Having someone in the trenches with you and that was the thing that I just prioritized above all else. I say if this is the thing I can get through this, then I’m going to do it. And I think there’s one saying or quote, I really I think colors a lot of my perspective of life, which is to say you grow at the edge of your comfort zone. So if you’re not challenged. If you’re comfortable, you’re not growing. It’s when things are bloody scary when you feel like you’re borderline drowning and you somehow find the way to swim through. That’s when you grow. That’s when you learn. I was like, OK, I’m scared of this decision. I’m scared of doing this ‘cause it’s going to make me uncomfortable as hell. OK, let’s do it.

Jeremy Au: (21:19)
Amazing. When you did that move, what surprised you moving from South Africa to Southeast Asia?

Tamir Shklaz: (21:26)
A functioning public transport and 24/7 electricity. Up there, just a concentration of just unbelievable people like every other day. I was just having incredible conversations about something new cryptocurrencies, AI, data science, the selection of people that I found. I just wasn’t expecting such a good mix of thought-provoking people and thinking over that time, I guess.

Jeremy Au: (21:55)
If you could go back to when you were a senior in university, which wasn’t too long ago, what advice would you give yourself back then?

Tamir Shklaz: (22:05)
Slow down. I always had this thing needs to get done. Now I need to finish whatever might be any speak to these investors this week. I need to finish this feature this week. I need to get to a certain points by this point in time. And you need to work nonstop. I hit burnout so many times. Kind of thinking that way. The key thing I realized is that you’re doing. This is a heavy topic to end on, but you’re doing it to live in the moment more. It’s not about the process of building this kind of stuff. The reason I do it isn’t for the destination. It isn’t for some sort of end goal that you eventually reach. I think we’re very good at convincing ourselves that once we arrive at a certain point then we’ll be happy. Will be fulfilled. It’s never the case. Whenever you arrive at point X, it’s endpoint Y and then point Z and then .8 whatever it might be. The thing I kind of realized going through a lot of this burnout and hardship was like the thing to prioritize is just enjoying the moment, kind of optimizing for - am I having fun right now? Am I learning? Am I growing? If I could get that, I still struggle that sometimes I think we all do today, but if I could make that so much more clear to me two years ago, the level of happiness that I’d go through those two years would be so much greater.

Jeremy Au: (23:17)
Amazing, Tamir. What a story. So I love to wrap up by summarizing the three big themes from this conversation. The first, of course, is just this journey of being someone growing up in South Africa and making that set of decisions around what you want to do with life from gaming as a career to be engineer. To exploring and catching the entrepreneurial bug. So that’s really a fun story. And I think the second of course, the little bit about the debate about incubators and matching programs like Entrepreneurs First and Antler, about how to think about equity, how to think about matching, how to think about what the risks are. And lastly, of course, thank you so much for sharing about your founding journey. And what the reflections that you’ve had is really about really taking a moment to pace yourself and not burn out too quickly. So thank you so much, Tamir, for coming on the show.

Tamir Shklaz: (24:09)
Good summary. It’s been a pleasure and a lot of fun.