In this week's episode of the Be Epic Podcast, Brent converses with Josh Stanley, CEO of Cartwheel Studios, and Fahad Siddiqui, Principal and Senior Vice President at SSI. They delve into their unique career transitions from corporate roles to entrepreneurship, their individual contributions in the thriving ecosystem of Northwest Arkansas, and the dynamics of the startup studio and venture studio models. This episode offers valuable insights into the world of startups, making it a must-listen for aspiring entrepreneurs and business enthusiasts.

When you're a startup and you need capital,

right capital is just an ingredient to your success

story. It's the fuel to your ship that you've built. Like

your as a startup, you're always kind of seeking you're hopeful

for smart money.

Welcome to the Be Epic Podcast, brought to you

by the Sam M. Walton College of Business at the University of

Arkansas. I'm your host, Brent Williams. Together, we'll

explore the dynamic landscape of business and uncover the

strategies, insights and stories that drive business today. Well,

today, I'm fortunate to have with me two guests. I have Josh

Stanley, who is CEO of Cartwheel Studios. And also have Fahad

Siddiqui, who is Principal and Senior Vice President at SSI.

We'll tell you a little bit more about both of them about SSI and

Cartwheel what they do. And the unique partnership they're

forming in Northwest Arkansas. But maybe before I do that, let

me ask each of you to tell us just a little bit about you and

your background. Josh, I'll start with you. Fahad come to

you next. And then Josh will kind of come back and talk about

Cartwheel.

Okay, sure. Yeah. Yeah, my background. And I would

say professionally, I came up in product management and project

management, have kind of run teams on both sides of that kind

of technology facilitation role and got into entrepreneurship

after spending years at 1-800 Contacts, which is the contact

lens business. And then Backcountry.com, and then

ultimately, Zappos. So I spent a long, basically 12 years in E

commerce doing those roles, and then took the leap of faith that

a lot, or I shouldn't say a lot, but some, some corporate people

take into entrepreneurship. Did that after kind of fighting

through this, like, how am I going to become an entrepreneur,

I went through a period of feeling like I needed the

perfect idea. And then I ultimately ultimately landed on

this concept of like, no, I should just do what I'm good at.

Like, I could do that as a consultant, as a contractor. And

that's how I started and then kind of eventually ended up

working with some friends to build an agency out of Las Vegas

that served product development. So we were a product development

agency that did software development, but kind of

holistically covered the spectrum of product management,

design, and software development so that we could, you know, in

isolation, kind of go off and build build a product for a

client, for the Fortune 500 clients that we worked with. And

then I mean I'll include how I got to Northwest Arkansas,

because that's it's at the heart of I think a lot of what we want

to talk about today. And that's, yeah, in that, running that

agency for about two years and growing that to a couple million

bucks in revenue. We got acquired by a larger agency out

of Northwest Arkansas called RevUnit, which I think many in

the region know. But yeah, just a larger software development

firm or product development firm. And ended up running that

for about two years and then exited, exited that or helped to

help RevUnit go through a private equity transaction in

2019. But yeah, so I've co founded I think six companies.

Now I'm kind of skipping over some of the details of how those

happened. But it had been through a few exits as well. So

it's been a it's been a fun journey and now based in

basically Bentonville, I live in Little Flock just outside of

Bentonville, but our office is in Bentonville.

All right, wonderful. Well, Fahad, how

about a little bit about your background?

It's hard to follow Josh on this one,

Certainly less exciting career. But I spent I

It is.

started in the telecom sector in New York, basically big

corporate, spent 10 years in telecom in different positions,

very corporate positions, corporate development, strategy

planning, little bit finance and strategy oriented and then

wanted to get closer to sales and marketing. Became head of

marketing for a b2b division, business services division. So

that was sort of the 10 years were planned out and then

decided, okay, let's do something more entrepreneurial

than try to set up own my E commerce startup. Now, I'm in

Chicago at this point, spent exactly a year and three months

doing that and burning all my cash, great experience, you

know, loved it, but didn't work out for me. And that's when I

ran into the founder of SSI in Chicago and decided to join

these guys to help grow this business. And I've been here now

nine years. It's been a fantastic journey. We've grown

this company from 50 to 550 in this period of time, so great

experience.

Well, incredible experience for both of you.

Josh, you're now you're in Northwest Arkansas and have

created and leading Cartwheel, cartwheel studios. And I would

tell us a little bit about Cartwheel I think maybe many

people aren't all that familiar with the venture studio model.

Yeah, I definitely find that that's the case. I

mean, it is kind of an emerging asset class of sorts. And so

yeah, I can speak to Cartwheel, and this, this startup studio

slash venture studio model. So we yeah Cartwheel started as a

startup studio. And I'll talk about that transit, the

transition, we're in the middle of right now kind of expanding

that scope. But yeah, essentially, anybody who's

founded a company before, knows how hard it is to get a company

off the ground, to start from scratch, to build from zero to

get even to a million dollars in revenue was a big accomplishment

and requires blood, sweat, and tears. And I think another

another thing that I think most people know about startups is

90% of them fail, like that's a fairly well known stat that gets

thrown around. So I think the startup studio model and the

venture studio model, and I'll talk about the differences in a

minute, or they're very nuanced differences between the two,

they're relatively the same. But the model itself is like how do

we improve that 90% failure rate? How do we pull forward the

failure rate? How do we do it early on before significant

investments of people's time, talent and resources. And so

that's really what the startup studio model is striving to do.

It is not an incubator, which a lot of people start translating,

you know, startup studio into incubator or it's not an

accelerator, either. Both of those models go out and seek

either a founder or co founding team, or an established startup

to help accelerate their growth, right? Like those models are

great models, and nothing wrong with them. But they are built to

kind of take an established person or team and startup, pull

it in, and help accelerate it in some capacity, where the startup

studio venture studio model is more about, let's go identify

the white space that exists the blue ocean opportunities in

different markets. So you tend to focus on a certain thesis. If

you're running a studio, like for us, it's the retail value

chain, which I know is near and dear to you, Brent. And that

that idea of focusing on retail value chain for us, it's like,

okay, let's go identify where where are there opportunities in

the retail value chain for us, where we can come up with new

business concepts. And we tend to try to have affinity mapping

around those business concepts. And by that, I mean, hey, this

next cohort of concepts is all gonna be focused on supply

chain. So we're gonna go identify 20 concepts,

potentially viable business concepts in the in the supply

chain space, and we'll vet that will validate, we'll do

business, subject matter expert, or operator or corporate

interviews, where we're helping to identify assumptions that

we've made about those concepts, like what are the most critical

assumptions we have about that concept that we have the least

amount of confidence in. And so we'll go out into the market,

we'll do market analysis, competitive analysis, and

interviews, that allow us to kind of validate and vet what

assumptions might be true and what assumptions are, are

clearly false. So with that in mind, we actually start with a

large number of concepts, and then whittle down to say, two to

three concepts by the end, that we can feel the viable

businesses that have been vetted and validated, that allow us to

then hopefully, find a co-founder. So we go out into

the market, and seek to identify an individual has a unique

advantage in that business concept. And we attach them to

that concept to go over the last kind of stage gate to forming

and funding a company. So that's the startup studio. That's how

it's different from an incubator and accelerator. And it's,

hopefully, a higher probability of success than just starting

from scratch what we see when we look at and help and try to help

startup founders that might exist out in the community,

because we see a lot of confirmation bias, we see people

that seek out data that that validates the assumptions

they've made up front, we see emotional attachment. Maybe like

you're you're really attached to this thing, and it just doesn't

have the legs. And so what we believe is that the startup

concept really allows for the separation or startup studio

concept really around allows for that separation, because if we

don't, if an idea isn't working, like we're not emotionally

attached, like we will take it out behind the barn and shoot it

like we will, we will put that idea down if it doesn't have

legs, and in a way that allows us to really get to the heart of

what has the highest probability of success. So that's, in a

nutshell, that's the model of venture and just to say at

startup studio, venture studio, venture studio looks exactly the

same as what I just described. The only addition I would add is

it typically has a sidecar fund. So it has what looks like a

traditional venture fund attached to it, where it can do

follow on investments into those startups as they kind of

continue up the lifecycle into later stages. And later

fundraising. Fundraising rounds.

Totally makes sense. And Fahad, you have you

and SSI have gotten engaged, I think maybe was the initial

partnership around the Pocket Factory product?

Yeah, so I can give you some backdrop of that.

So over a period of time, we've actually built some products

with some entrepreneurs and launched them as separate

entities. And Pocket Factory is one of those products, which is

a Industrial Internet of Things, industrial IoT platform, focused

on the bottling sector. So take, you know, bottling like Coca

Cola, Pepsi, Heineken, whoever it may be. So, to the platform

is, you know, it's applied to the manufacturing facilities,

cleanse data and give them predictive maintenance and give

them a health check on their manufacturing facilities. So we

decided we needed a platform to scale this startup. And that's

when we ran into Josh and team and found that Cartwheel to be

an impressive platform. And we thought this startup could, you

know, learn in and scale, basically. So that's how we

started this partnership. And now that partnership is much

broader than larger than maybe started off.

Well, these are, these are sort of Josh's words,

not yours. Exactly. But you know, when he described SSI to

me, you know, he said, you guys are a little little unique in

that, you know, you're high quality, you're fast, you work

well with startups. And then you also have a fund where you do

invest in maybe some of those startups. Tell us a little bit

about just SSI and kind of was Josh right? Is that? Is that the

right description?

I hope he is. Well, all I can say is that

we've got a good track record. You know, we we're currently

engaged with, like 40 plus tech companies, out of which most of

them are startups, happen to be startup or are co-funded

startups, few are idea stage companies. The rest of our

clients are more enterprise or let's say publicly traded

companies where we're doing multi year sort of projects. But

in terms of the number of customers, most of our work is

in the tech space. And out of that portfolio, it's mostly tech

startups. And I think where we have been successful is our

average client relationship goes about five years. And for the

top 10 clients, it's about eight years, which is not typical in

the sector. And really, I think the reason for this is because

we have such a great model of engagement, where we can

understand the needs of an early stage firm, which are very

different from when they scale to a growth stage, and then to

maturity. And we work with all size and stage firms and build a

very flexible model that can take them from that idea all the

way to market to scale. And then beyond and in our team of you

know, technical architects to developers, etc. That team kind

of evolves as their majority evolves. And so I think that

model has really worked for us. And it's been successful. We've

been lucky. Also, we work with some really amazing startup

founders and startups that started with you know really two

guys and two dogs that came to us with an idea and exited for

$400,000,000 2 years later and built, and all those platforms

have been built by us. And, you know, since that happened, you

know, we set up our own fund because we were like, okay, we

didn't have any skin in that game. You know, they had a great

exit and we've been their partners, and even today with

the startups. They're not a startup anymore. They've been

acquired by a publicly listed company. So so we set up our own

fund. Take, you know, basically, we invested in this fund. And

the idea is, again, on a case by case basis, where there's a good

match in terms of domain or industry knowledge and

expertise, and we can bring something to the table, other

than just pure development capabilities. And we see a good

match with the founders will typically participate in their

capital raise and invest and you know, and it's a win win for

everyone because you know, our personal money our company's

money is tied into their success. And so everybody wins

and we make sure that they're successful. So try to make sure

as much as possible.

Yes. Just to jump in here, like, it's not possible

that every vendor on the planet can do what what SSI can do. But

like when you're when you're a startup, and you need capital,

right capital is just an ingredient to your success

story. It's the fuel to your ship that you've built, that

you're hoping to take, you know, Exit, Exit, Exit, the

gravitational force of kind of just creating a company with and

like to have a partner that also has the ability to invest in

your startup, like your, as a startup, you're always kind of

seeking, you're hopeful for smart money, right? You're

hopeful that along with that capital, that ingredient that

fuel to your ship, you can also get someone in partnership with

you, that has aligned incentives that can bring more value to the

table and man to have your technology team have that

capability to also be kind of a contributor to that fuel. I

don't know there's a lot of power, I'd love to see more. I

would love to see more companies that provide services to

startups that are always asking for payments, right? Like

they're selling, selling into startups or selling into series

A Series B companies wanting they're wanting their cash that

they've raised in exchange for services, but also to be able to

contribute back, not in all instances, but when it when you

know, interests are aligned. Like when you can create a line

incentive relationships with vendor partner vendors. I think

that's where some of the best outcomes come from when

everybody's invested. He's like, no, we need this to work. Let's

make sure we're coming up with the best concepts, delivering

the best possible solution. I think that's interesting for me.

Absolutely. You know, and and Fahad, well, you

know, I'm, I'm a big believer in the state of Arkansas and

Northwest Arkansas. Clearly, I've spent much of my life and

career here and get a chance to lead the Sam M. Walton College

of Business, which is quite an honor, as you can imagine. But

my understanding is that you are working on opening an office

here in Bentonville. And so you must see, at least some degree

what we're seeing, I think.

So again, I'll give a lot of credit to Josh and

team. They basically, they invited us to Northwest Arkansas

to take a look at the ecosystem that all of you are building

actually together. We were very impressed, we're pretty active

in the Chicago sort of surrounding between Chicago,

Milwaukee, Detroit, sort of the broader technical system,

incubators, accelerators, venture capital funds, we've

invested in a bunch of funds ourselves as well. So we stay

engaged in that ecosystem. And when we came, visited your

region, we found the region which is developing fairly

quickly, great concentration of you know, Fortune 100, great

activity overall, we felt that this could be a place would be

to be should invest and get engaged in the tech ecosystem,

and try to be an active contributor. So we decided to

partner so we signed a partnership with Cartwheel as

well, broader partnership. And then as part of that, we will

set up an office and we're in the process of setting up an

office there and hiring a couple of key people to be engaged in

activity, that ecosystem. Also, I noticed you guys were ranked

on the Wall Street Journal's List of cities, that was just

what two days ago, I saw that you guys were ranked number two,

and that's sort of the mid size or small size regions that have

gotten highest concentration of tech skilled tech workers. So

congratulations. That's amazing.

Well, this, this region is rapidly developing in

that respect, and certainly is exciting. And I'm excited you

and your team will be here and be engaged in the ecosystem. You

know, Josh, I want to go back to a point when you were describing

Cartwheel you that I think is probably really important. I

know it's one of the things that really excited me is that you've

got to you've got a strong focus on the retail value chain. Why

is that important? I mean, I'm sure there's some probably some

obvious reasons, but there's probably some nuances to why

that's important as well.

Yeah, I mean, I think you know, this as well as

anybody else in the region that we've got tremendous activity in

the ecosystem. We got tremendous contributors in the kind of

entrepreneurial support organization network here, a lot

of it. And we and we have amazing philanthropic families

here that contribute to a lot of activity and kind of the growth

that we're all experiencing and loving, I think. But you have

the investments that have been made in in health tech and

health care, which I think need to continue to be made. We have

investments in, I would call Air Mobility or mobility in like the

up summit that's taking that has taken place here. We've had

investments in outdoor rec, obviously, GORP that runs, you

know, out of your programming at the university that really is

meant to be an incubator, to outdoor rec companies and

startups. So we have these kinds of interesting capabilities

being established and built here. But when you take a step

back, and you say, well, that's a lot of there's a lot of

activity and a lot of different places. Not all of those

activities are built around established capabilities, like

true mature capabilities. And by that I mean, think advanced

subject matter experts, people that have a depth of knowledge

in a particular area. We don't have the concentration of that

in healthcare yet, or health tech or biotech, we don't have

the concentration of that yet in Air Mobility. There's a lot of

great work happening with drones and all these different areas,

but it's just not mature and established. But when you look

at the retail value chain, when you ask yourself, where what do

we have a unique advantage in, an unfair advantage in which I

think from a startup perspective, it is critical to

assess, and then where do we have a depth of subject matter

expertise? Where do we have established anchored kind of

incumbents that are industry leaders, and its retail value

chain all day, we have Walmart, we have Sam's Club, yes, that's

what this region I think is most known for, is being the

headquarters to those those major, you know, Fortune One

companies, or fortune one company, and but we have Tyson

Foods, we have Simmons, we have George's, we have JB Hunt, we

have Arcbest. And the list goes on. Like, we never include the

other billion dollar companies that are here in this region

that are all really ultimately connected through the retail

value chain from getting a product created, to getting it

into the hands of the consumer. So that to us. And actually,

before I do, I'm gonna give credit where credit's due. And

we have a university that has a top ranked supply chain school,

in in in the country, if not the world. So, you know, we have

this great mix of emerging talent established capabilities,

deep domain knowledge, talent, like how do we take this amazing

combination of resources and global reach really, with the

companies we have here and leverage it into emerging

companies? Like how do we take emerging technology and combine

it with subject matter expertise to disrupt the industries that

are aligned with the retail value chain like we can out of

this region, build startups that are the next Walmart, Sam's

Club, build startups, the next JB Hunt and Tyson, like, we can

build those kinds of technology companies here. And it's going

to be because we have an amazing university program that produces

young talent focused in that in those areas, it's going to be

because we have amazing anchor corporates in this region that

attract that kind of talent. And it's going to be because we have

an amazing ecosystem, and the right kind of support from

different angles that allow us to create new businesses and

help them thrive here. So there's more work to be done.

It's not perfect, there are gaps in our in our ecosystem. But

yeah, when we when we took a step back and just ask

ourselves, where do we have a right to win? It's like this

retail value chain all day. Like, if we're not building

companies in that space. It's, it's, it's shame on us is this

kind of how we feel like if we're not willing to partner

with with you and your team and the University programming, and

corporates here, and kind of all work together to help build new

tech companies in that space. We're missing out on being the

kind of global leaders in the future, like the leadership we

have today is as fleeting as anything like the s&p 500 is the

stat we always point to have like the average lifespan of a

company in the s&p 500. If you go back to the 1960s, it was

some 60 some odd years that the average lifespan of a company

existed in the s&p 500 had been around you go to today, and the

average lifespan is 15 years. So what that tells you is that more

early stage companies are taking over in the s&p 500 that

incumbents have been disrupted by challengers. And that is a

continued pattern that the lifespan is shrinking. We're

going to see more of that. So we need to be building those

companies. We need to have a shot at continuing to be the

leader in that space for the next 10, 20 30, 40 50 years and

beyond. Like that's the kind of vision we need to we need to

start taking as we as we look at what's possible in Northwest

Arkansas. That's my rant for the day.

I couldn't agree more and probably could not have

said it better. And it is exciting to be here at this

time. Because you know, I do believe that, that all the

ingredients are here for, you know, the next wave of

innovative companies to be built right here that will impact the

retail value chain for many, many decades to come. And, and I

think both of you are important pieces of those ingredients. So

Fahad looking forward to getting to see you more, as you're in

Northwest Arkansas more and excited that SSI is joining our

region. And Josh, really excited about what you are doing at

Cartwheel and excited about the startup studio model. I want to

say both of you, thank you for partnering with the Walton

College of Business. And thanks for being willing to join today.

My pleasure.

Yeah, appreciate you. Thank you for having us on.

Thank you for being so supportive of all the programs.

And I mean, I'd be I would feel maybe missed if I didn't at

least bring up hey, we've got bounds accelerator, and I don't

know when this podcast is gonna go live, but I'm gonna do it

anyway. So we're working with with, Cartwheel's working with

the University of Arkansas, and really your your team on bounds

accelerator, which is launching in January. So if this happens

to get out before November 3, we are still accepting

applications. And these are interest. This is for traction,

or startups that have traction that have some revenue post

revenue in the emerging tech space applied to retail value

chain. So if anything you're doing in the startup space has

any application to the retail value chain, please apply to the

bounds accelerator, you can reach it

bounds.cartwheel.studio, and again, that's in partnership

with the University of Arkansas and many corporate sponsors

along with Han Ventures, Coin Base, and AI Foundation. So

we're bringing a great collection of established

emerging tech companies in alongside the established retail

value chain companies and in partnership with the University,

I think it's gonna be a great program excited about it.

Yeah, as you know, super excited about that

partnership, all the different partners that have come together

to make that happen. Josh, you, your team, other partners. From

from our standpoint, you know, I have to mention Sarah Goforth,

who leads our Office of Entrepreneurship and Innovation.

That's really been the key driver from the University of

Arkansas side in in this effort and many more to build this

ecosystem. So excited about the partnership. Thank you both for

being here today.

Thank you.

Thank you for having me. Thank you.

On behalf of the Walton College thank you for

joining us for this captivating conversation. To stay connected

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