See show notes for this episode: S 02 | Ep .. Shane Neman
00:00 - Alex Shevelenko
Welcome to season 2 of Experience-focused Leaders. I’m delighted to introduce you to Shane Neman—serial entrepreneur, venture capitalist, and real estate developer.
Shane has had an incredible journey. After dropping out of NYU Medical School, he built JoonBug, a nightlife digital events powerhouse. He later wrote a book called NightLife Lessons and, more interestingly, founded and exited EZ Texting, the largest business SMS SaaS platform in the U.S.
Today, Shane is a prolific startup investor and manages a real estate portfolio that includes properties like the Santa Monica Pier. Shane, I’m thrilled to have you on the podcast—welcome!
00:54 - Shane Neman
Alex, thanks so much for having me!
00:56 - Alex Shevelenko
I’m excited to have this conversation. Let’s start with a question that probably doesn’t come up on a typical business podcast—the New York nightlife scene.
Why did you decide to build a major business in that space?
01:19 - Shane Neman
To be honest, it happened by accident. I never expected to go from medical school into the nightlife industry.
01:31 - Alex Shevelenko
Sorry to interrupt, but I’ve heard that doctors often struggle with addiction, including alcoholism. Was that part of the culture you encountered?
01:45 - Shane Neman
No, not at all. In fact, part of our success came from the fact that we weren’t really partiers. I barely drank.
What set us apart was that we built technology for the nightlife industry. Many nightclubs, bars, and event spaces used our platform. Over time, we created an operating system for them, which included a marketing stack, POS integration, and ticketing. In fact, we were one of the first to introduce ticketing solutions for nightlife venues.
The way I got into this space is a bit of a convoluted story. While I was in medical school, my roommate—who was working at Goldman Sachs—convinced me to drop out during the dot-com boom to start a company. Somehow, he found investors willing to give two 22-year-olds millions of dollars to build a startup.
We ran that company for about two years before going down with the dot-com bust. That was actually about a year into med school when I decided to drop out.
My roommate convinced me to start a company during the 1999 dot-com boom. About two years later, the dot-com bust hit.
At that point, I moved in with my girlfriend, who was studying at FIT and working at nightclubs on weekends to earn extra money. I’d go to pick her up at the end of her shifts, and while waiting, I started noticing how everything was still being run with pen and paper. This was around 2000–2001, and it seemed incredibly outdated.
I thought, There has to be a better way. So I went back to her dorm room and started coding. I had a degree in computer science—though I went to med school, I had studied CS before that—and from there, things took off.
We built the software, sold it to a few nightclubs, and over the next decade, our platform became the go-to solution in that industry. No one else was really targeting that niche, and it grew into a major business.
My next company, EZ Texting, came out of a need we identified while running JoonBug. Around 2005, email marketing was losing effectiveness—services like Constant Contact and Mailchimp were everywhere, and every DJ, club, and promoter had their own list. SMS, on the other hand, was proving far more effective, but there was no scalable way to manage text-based marketing.
At the time, no one was really doing SMS marketing. If you Googled it, there were barely any results. For years, it felt like shooting fish in a barrel because no real solution existed. This was before Twilio—2005—so text messages had to go through phone systems rather than the internet.
When we first introduced SMS as part of JoonBug, I remember sending the first mass text and immediately getting around 100 calls from people asking how I did it.
06:03 - Alex Shevelenko
And it was still pretty new, even in the late 2000s. I remember nightlife around 2005–2009—it wasn’t common to get texts from clubs back then.
06:18 - Shane Neman
Yeah, 2005 was when the BlackBerry really took off, but texting still wasn’t that convenient with a physical keyboard. The BlackBerry helped open up that space, though. I had one at the time, and really, almost no one in the U.S. was doing SMS marketing—except in parts of Europe, like London.
06:46 - Alex Shevelenko
Yeah, I remember London had more of that going on.
But going back to those days—what made the nightlife business different from the others you’ve been involved in? Now that you’ve sold JoonBug and moved on, what stood out about that experience?
07:06 - Shane Neman
Yeah.
07:08 - Alex Shevelenko
You obviously didn’t drink, so it wasn’t like you had some secret advantage in the nightlife scene, right?
07:13 - Shane Neman
No secret. But trust me, I could drink you under the table and still close a deal.
07:20 - Alex Shevelenko
So was it just like running any other business, or was there something different about it?
07:25 - Shane Neman
In many ways, it was like any other business—we found an underserved niche and built a solution for it. The biggest difference was timing. In 2000–2001, most venues didn’t even have a website. A lot of the tools we take for granted today—MailChimp, Facebook, website builders like Wix or Squarespace—didn’t exist yet. There just wasn’t much competition in the space.
08:05 - Alex Shevelenko
So you basically provided a full-stack solution—kind of like OpenTable meets Eventbrite?
08:14 - Shane Neman
Exactly. Eventbrite wasn’t even around at the time, so when we introduced ticketing, it was a completely new concept. For us, the value was in simplifying everything for venue owners, who, in a way, were early adopters. They were always looking for ways to maximize profits, so if something made sense, they’d try it.
They also needed to understand their audience—who their patrons were and how to reach them. Younger crowds wanted to buy tickets online, get invites via email, and check event details on a website. We built the tools that made that possible.
09:13 - Alex Shevelenko
And what were nightclub owners like back then in New York? Was it all cash under the table, or were these more clean, well-funded businesses?
09:25 - Shane Neman
Yes, absolutely. We started in New York but expanded nationwide over the next 10 years. New York has always been at the heart of the nightlife industry—it’s where trends start, and I think that’s still true today. It’s definitely the avant-garde of the business.
In the beginning, I was willing to do what others weren’t. I met with owners and managers on their terms—even if that meant meetings at three in the morning. Sometimes I had to wait an hour because the club suddenly got crowded or there was an issue with an employee. Some owners even wanted to pay in cash, so I’d go pick it up myself.
I did whatever it took to make the business successful. It wasn’t always ideal, but it was necessary to build credibility. Once we became the established player, we could set the terms—no more cash payments, everything had to go through credit cards, and so on. But early on, flexibility was key. You have to be willing to do what others won’t.
11:09 - Alex Shevelenko
At what point did you start feeling more confident? Was it when demand outpaced your ability to keep up?
11:44 - Shane Neman
We were really the only database that had direct access to this market. We also did things others didn’t understand at the time. For example, we’d go to nightclubs, take photos, and post them the next day—this was before camera phones, before MySpace and Facebook. Today, no one would do that because everyone has a phone, but back then, it was a novelty.
We’d hand out cards directing people to our website, and if they wanted to see their picture, they had to enter their information. That’s how we built our database.
12:23 - Alex Shevelenko
I must be in your list somewhere. I’m probably sold in some database.
12:28 - Shane Neman
That list is long gone, my friend! No idea where it is now.
But things really changed when we started landing bigger, enterprise-level accounts. That gave us legitimacy. And then, as we were already in ticketing, EDM took off. Venues went from selling thousands of tickets to hundreds of thousands, then millions per year.
If you do the math, we charged around $3 per ticket as a convenience fee. When you’re selling 5–10 million tickets, that adds up quickly. It was essentially money from thin air—just for selling a digital ticket. And that’s when things really took off.
14:00 - Shane Neman
I think the two major turning points were when we landed big enterprise clients—having those well-known names gave us credibility—and when we started selling tickets at scale. That also became an inflection point for our database. We built the largest database of people who went out, bought tickets, reserved tables—you name it.
14:08 - Alex Shevelenko
If you can identify someone willing to buy a table, that tells you a lot. They have disposable income, they’re not price-sensitive, and they’re a prime customer.
14:23 - Shane Neman
Exactly. We knew who they were, where they were, and how much they spent. We gathered a ton of data. We also introduced advanced strategies with ticket sales—like analyzing demand and ticket velocity to dynamically adjust pricing. This was back in 2008, and at the time, nobody else was thinking that way.
14:49 - Alex Shevelenko
You could’ve built a dating app with all that data!
14:53 - Shane Neman
Yeah, people today call that artificial intelligence or data science, but it existed back then too—it just wasn’t as widely understood.
15:14 - Alex Shevelenko
For people tuning into this podcast, they care about experiences—whether digital or in-person. We’ve talked about the digital side, like buying a ticket online. But nightclub owners aren’t always the same demographic as their customers. So they had a challenge, and you stepped in to fill the gap by creating digital tools for them.
15:50 - Shane Neman
Exactly. But more than that, we had to educate them. There was no existing market for this at the time. Early on, it was all about teaching them how and why to use these tools. But once the top 10 venues adopted it, the rest followed.
That’s the key—get the leading venues on board, and the rest will copy. It created social proof. If the best nightclubs were doing it, everyone else wanted in. Plus, once they experienced it firsthand—getting an email invite, seeing the digital engagement—they understood the value.
Even if you look at companies like Constant Contact and MailChimp, they had to educate their customers in the early days. It wasn’t just selling a product; it was about changing the way people thought about marketing and engagement.
17:11 - Alex Shevelenko
Yeah, that makes sense. And I assume at some point, you transitioned toward a SaaS model?
17:18 - Shane Neman
Oh yeah, we were SaaS—we had a hybrid model. It was SaaS, but we also had an ad model and a ticketing model for additional revenue streams.
17:34 - Alex Shevelenko
Yeah, but selling SaaS in 2005 was a different challenge. I was at Salesforce and SuccessFactors back then, and a big part of the job was educating people—not just about the product but about the SaaS model itself. People weren’t as familiar with it, and I think that’s something we underestimate now. I remember training our sales team with five differentiators just about the tech—why SaaS and subscriptions mattered—before even getting to the product features. I imagine in your industry, it was even harder than in traditional corporate settings.
18:22 - Shane Neman
It definitely was. But what’s interesting is that I was actually prepared for it—because of the failure of my previous company. We were a SaaS company back in 1999, trying to build what was essentially Microsoft 365. But since web-based apps didn’t exist yet, we used Citrix.
Back then, all apps were Windows-based. What we did was create an interface where you could click an icon in your web browser—say, Microsoft Word—and it would open a Citrix session on a remote server. The software was running on that server, and the internet basically functioned as one big keyboard, monitor, and mouse connection. You always had the latest version of Word, and we even pioneered cloud storage—though "cloud" wasn’t a term yet.
19:14 - Alex Shevelenko
So, kind of like an early version of Google Docs, but in the ’90s?
19:18 - Shane Neman
Not quite. It was actual Microsoft Word running on Windows—just virtualized.
19:21 - Alex Shevelenko
Oh, so it was the real Word, just running remotely.
19:22 - Shane Neman
Exactly. It was virtualization. Back then, they didn’t even call it SaaS—it was known as an ASP (Application Service Provider). We had cloud storage before "cloud" was a thing, and we even had an app store where users could choose which apps they had access to—Word, QuickBooks, and so on. But none of those terms existed yet.
The business ultimately failed—not just because of the dot-com bust, though funding dried up—but because we were too early. People weren’t ready to pay $30 per user per month for Word. They were used to buying a license, installing it on their computer, and upgrading every few years. But yeah, funny how these things come full circle.
20:24 - Alex Shevelenko
Yeah, people forget how these terms evolved. First, it was ASP, then "on-demand," then SaaS, and now "cloud." It’s all essentially the same thing. ASP was a bit more old-school since it wasn’t multi-tenant, but the core idea was the same.
20:48 - Shane Neman
Same thing is happening with AI now. People are calling chatbots "AI agents," but it’s really just an evolution of the same concept.
21:01 - Alex Shevelenko
I'm curious—jumping ahead a bit—you’ve learned some valuable lessons along the way. Your first business led to success, and in the second, you discovered that texting was a major opportunity. Then you moved out of the nightlife industry and built a leading SaaS business for SMS.
Now, as an investor, when you look at new ventures, are you specifically seeking serial entrepreneurs who have gone through similar challenges and learned from them?
21:46 - Shane Neman
That would be ideal, but in reality, founders with multiple exits typically raise at higher valuations. They can demand more from investors and often get funded right away. If you’ve built even one company and had a successful exit, it’s harder to find those founders early on—they’re already on the radar of major investors.
22:27 - Alex Shevelenko
So instead of discovering them, you’d have to compete with firms like Sequoia or Accel.
22:33 - Shane Neman
Exactly. But interestingly, many founders today are trying to avoid the bigger VCs, or they’re doing a hybrid approach—working with both VCs and family offices. They see the value family offices bring because we’re less demanding. We’re not constantly asking for reports or telling them how to run their business.
Personally, as an investor, I don’t want to be in that role. If I have to tell a founder what to do, I probably shouldn’t be investing in them. The whole point of investing is backing people who are smarter than you in their domain—people who can do what you can’t.
Sure, I have experience, but the world changes. What worked five years ago might not work today. If I push a founder toward something I believe is right but turns out to be wrong, that’s a problem. What I look for is someone who can tackle challenges head-on and solve problems independently. Of course, if they ask for help, I’ll give it, but that shouldn’t be the default.
So, yes, if someone has successfully built and exited a company before, that’s a great sign—but it’s not the only thing I consider. I spend a lot of time with founders because, at the end of the day, 90% of investing is about who you’re backing, not just what they’re building.
24:52 - Alex Shevelenko
So how do you figure that out? How do you get to the core of a person before investing in them?
When we last spoke, we discussed the experiences of immigrant founders—the challenges they’ve overcome in their personal and professional lives. What do you look for in someone that signals they have the grit, determination, and persistence to push through obstacles—whatever it takes to build a successful business?
25:32 - Shane Neman
It really depends. Honestly, if I'm making a significant investment, I'll spend more time on it. For smaller investments, I’ll spend less time—there's only so much time available. But when the investment is larger, I’ll take a different approach.
For example, I invested in a company called Flex Storage, which provides tech-enabled storage units that they bring to you. You can load your items into it, and they either take it away or leave it on your property. You no longer have to go to a self-storage facility. I spent a week at their office, even getting on a truck and delivering trailers for an entire day. This gave me the chance to meet customers, observe the founder’s interactions, and see how they communicate with their team. When you do that, there’s no way to fake it. Well, I guess someone could stage a situation, but the likelihood of that is very low.
27:02 - Alex Shevelenko
I can see how that gives you a better sense of what's real and what's fake, having done it so many times, right?
27:19 - Shane Neman
It wasn’t my first instinct to do that. I met with the founder, spoke to them several times before, and then made that decision. But knowing the founder had served in the army for a decade and had logistics experience, along with the fact that five of his team members had worked under him when he was a captain, made it clear to me that the founder had credibility. Some things just make sense.
27:49 - Alex Shevelenko
Let’s reverse the gears a bit. Imagine there’s a founder or aspiring entrepreneur listening to this who wants to approach you and your family office for funding. What do you find impressive when someone is doing due diligence on you? Let’s say it’s a larger investment, not a small check, because I think that’s an important part of the equation.
A lot of people in this position might not be constrained by capital—they’re more interested in whether the capital is easy to access, friendly, and brings value beyond just the financial aspect. It’s about the signaling, introductions, and the edge it can give them, not just day-to-day execution. So, from your perspective, if you were the one being “sold” on by a founder, what would you see as the value that you or your family office brings as an asset class?
29:08 - Shane Neman
When you get an investor like me, it’s my money, so I genuinely care. Unlike VCs who raise funds from multiple sources and may have account reps working for them, you’re one of many companies they’re invested in. If you fail, it doesn't really matter to them. But for me, because I’m personally invested, it makes a big difference.
29:58 - Alex Shevelenko
So, your portfolio is more concentrated on these investments, and it directly impacts your financial returns, so you really care about it.
30:04 - Shane Neman
Absolutely, yeah. And what also tends to happen is that when a family office finds a good investment, they usually share it with other family offices. Most family offices are run by entrepreneurs who’ve had exits. They’re not usually dynastic, though some are. These family offices are run by entrepreneurs with connections, resources, and expertise that can be valuable. They could be potential customers, other investors, or mentors. Also, what's interesting about family offices is that they tend to move faster than VCs. They have more latitude and can make quicker decisions.
I’ve invested in a range of industries—from med tech to self-storage, robotics, and CPG. Everything is fair game. There’s no mandate, and I don’t have investors dictating what I can or can’t invest in.
31:36 - Alex Shevelenko
That's really interesting. I was intrigued by your barbell strategy and the range of investments you make, especially the mix of a real estate portfolio—like the Santa Monica Pier—and deep tech ventures. Could you share more about that and how you bring it all together?
32:02 - Shane Neman
Yeah, well, I’m fortunate in that I have a background in tech, which helps me assess and diligence tech investments well. What I didn’t mention earlier is that JooneBug and EZ Texting were profitable businesses because they were bootstrapped, so I have a lot of experience in real estate investment over the past 20 years. Coming from an immigrant family, I was always advised to reinvest my money into real estate, rather than the stock market—though, in hindsight, maybe the stock market would’ve been a good idea too.
32:48 - Alex Shevelenko
Right, the American dream in real estate.
32:53 - Shane Neman
Exactly. So I had a lot of experience in it and had been investing for some time. But getting back to the barbell strategy: in the last four or five years, I’ve focused on the leaders in deep tech—AI, quantum computing, robotics, those areas. I think that’s the future. I’m relatively young, so thinking 20 years out still feels okay to me.
At the same time, I want to invest in businesses or assets that I don’t think can easily be disrupted by deep tech. Or at least, ones where I don’t have a vivid enough imagination to foresee how they might be disrupted. For example, the Santa Monica Pier: it’s a business similar to Coney Island, with games, food, rides, and has been around for 30 years. It’s one of the top tourist destinations in Los Angeles. Unless tourism is somehow disrupted by AI—though it’s hard to imagine how that would happen unless we all shift to virtual worlds—it seems relatively safe. People will still want to visit, take their kids, eat, and have fun in California.
34:50 - Alex Shevelenko
You’re going to get thirsty; it’s hot.
34:52 - Shane Neman
Yes, absolutely. I mean, the weather’s great, people will still come. It’s the United States, after all. Sure, right now there are some short-term issues, like the fires and things like that. But as a practical matter, when I look at it, maybe it’s just my short-sightedness, but I can’t really imagine a scenario where, 20 years from now, it’s not still here. The same goes for other areas.
35:21 - Alex Shevelenko
It sounds like the storage investment is exactly that.
Shane Neman
Yes, people are going to accumulate stuff, right? Will they get lazy? Yes. So if you can manage their stuff in a convenient way, there’s definitely value in that. Absolutely. That’s the thesis.
Alex Shevelenko
By the way, here’s a funny story. When I moved from San Francisco to London to grow the SuccessFactors business, I had this massive library of books I had collected over the years. It was one of my most valuable possessions. But I decided to be cheap and left it with a family member for storage, and they misplaced it. Out of all my things, that was the one that hit me hardest. Eventually, they donated it, which I guess was good, but it was still personal to me.
36:29 - Shane Neman
So, you're saying you wanted to reduce the risk of losing something that valuable?
Shane Neman
Well, the self-storage business is huge. Companies like Public Storage or Extra Space Storage are publicly traded REITs, and they command big premiums. Like you just said, people might downsize to a smaller place, but they’ll never give up their memorabilia. It could sit in storage for 30 years, and they won’t get rid of it. It's basic loss aversion—psychology 101.
37:20 - Alex Shevelenko
Right, people don’t want to lose their stuff. And with so much clutter, it’s hard to sift through it all. So, you solve it with convenience, which is exactly what you're doing. I love it.
37:35 - Shane Neman
So we’re either focusing on that or going to the opposite end of the spectrum. Anything in between, where I can’t determine whether it’s going to be disrupted or not, I just stay away from. I’m not smart enough to figure it out, and there are so many other opportunities to pursue. You win all the bets you don’t take.
38:11 - Alex Shevelenko
Now that you're out of New York, you live in the...
38:16 - Shane Neman
South Florida.
38:18 - Alex Shevelenko
Miami area? How has that move influenced your investment decisions or your worldview? I think a lot of people are excited about Miami, with some moving there. Certainly, New York is still growing, but San Francisco—well, it feels like a lot of people left San Francisco for Miami, though some are coming back. You've seen this shift. Tell me about it. You’re investing in cool things from Miami, so how does the location influence your decision process?
39:03 - Shane Neman
When it comes to real estate and traditional businesses, I think Miami, South Florida, and Florida in general, along with Texas, are great places. There are a lot of smart people doing amazing things here, and it’s a growing, friendly market. I would highly recommend it. But if you're focused on tech or cutting-edge fields, Miami hasn’t quite proven it can sustain that. The talent just isn’t here. Now, of course, there are really successful tech companies here, but in general, I see that SF, New York, and LA are still the main hubs for tech founders. A lot came here for crypto, but the talent pool wasn’t here.
40:25 - Alex Shevelenko
So, it’s not just that they’re distracted; the talent is missing?
40:33 - Shane Neman
Yes, the talent is distracted. Most of the people who moved here already had money—maybe they had an exit, or they’re general partners of funds with a lot of capital. They can afford to live here, even if their industry isn’t based here. You get that type of person, but you don’t get the kind of people you need in a startup: hungry entrepreneurs who are ready to grind.
41:14 - Alex Shevelenko
The kind who show up at 3 a.m., ready to close a deal with cash and then run to the bank for a deposit—Shane, circa early 2000s.
41:27 - Shane Neman
Exactly. We’d literally go to Wells Fargo the next morning to deposit the cash. That mindset isn’t here, but if you can pull it off in Miami, you might do very well because, as I said, the people funding you are here.
41:45 - Alex Shevelenko
There’s a lot of wealth behind that, for sure.
41:46 - Shane Neman
Yeah, so it’s definitely worth coming here to look for investors. But I can tell you that work-from-home is essentially dead in the startup ecosystem. Everyone’s realized that if you want to build and scale a business, the magic happens in person. There’s been a definite shift in that regard. So, if you’re going to do it, you might as well be here, where all the action is.
42:25 - Alex Shevelenko
So, if you want warm weather, stick to South Bay or LA. Miami might work for very specific businesses, but not as a center of gravity. Israel is another great option for those who like warm weather. Now, going back to warm-weather climates, let’s talk more about the Santa Monica Pier. The investment you made there is quite substantial. If I recall correctly, it’s an iconic place.
43:06 - Shane Neman
It’s a large investment.
43:09 - Alex Shevelenko
How did you approach that? Why put such a significant amount into it? We get the strategy, but what about the actual allocation?
43:23 - Shane Neman
I think of something like the Santa Monica Pier as a forever asset. Imagine if someone came to you and said, "You can buy the operation," even though you can’t actually buy the Santa Monica Pier itself—it’s owned by the city of Santa Monica. We have a long-term ground lease there with operations, and it’s a business, a tourist destination. If someone told you, "You can own the business surrounding the Statue of Liberty," would you buy it? Absolutely, because you know for the next hundred years you’re going to make money. It’s basically a “diamonds are forever” strategy.
44:14 - Alex Shevelenko
This is a diamond, but not necessarily a high-tech one. It’s a flagship experience, right? It’s cash-flowing and has been for a long time.
44:28 - Shane Neman
Exactly. It has a 30-year history that you can look back on, and it’s iconic. Everyone I talk to knows the Ferris wheel. It’s actually the eighth most Instagrammed place on Earth.
44:46 - Alex Shevelenko
And the Hollywood presence—being in LA and all the films shot around here—helps ensure this will always stay relevant. Unless Hollywood gets displaced, this place will always be iconic.
45:02 - Shane Neman
Exactly. The location is a huge factor in its popularity. New York, LA, and Miami are the three biggest cities in the U.S. A lot of the foot traffic is driven by tourism—about 70% of it. So, it’s really a bet on whether LA will continue to be a major tourist destination. If you believe it will be for the next 30 to 50 years, then it’s a good bet. Opportunities like this don’t come around often, so when you see one, you take outsized bets.
46:01 - Alex Shevelenko
So, to what degree are you thinking about this? Let’s go back to experience and dive a bit deeper. How do you create this experience economy? We’ve described what it’s like to go to the Santa Monica Pier—an experience where you’re participating. How are you thinking about creating modern memories through both digital and physical experiences? Are you focusing on that, given your investments, or is it something you delegate?
46:39 - Shane Neman
I delegate to the operating company. My partner operates it—he's the general partner. I don’t have the infrastructure for it. I often invest or JV with operators and general partners that I know are really good. That way, I can spend my time doing what I enjoy instead of running operations. I get to live in Miami, not travel, and focus on quality control.
47:18 - Alex Shevelenko
So, like how Disney does it, right?
47:24 - Shane Neman
Exactly. We’ve definitely made upgrades. Recently, we improved the food and beverage component. There’s now a place called Snackville, where characters are involved, kind of like a healthier version of McDonald's. Experiences like that matter. We’ve also introduced mascots, expanded the number of rides, and implemented technology to reduce wait times. We got the first alcohol license in the history of the pier, so now parents can enjoy a glass of wine or a beer while they’re there.
48:05 - Alex Shevelenko
Is JooneBug still involved in supporting you in this?
48:09 - Shane Neman
No, JooneBug was sold almost 20 years ago. It feels like a lifetime ago, honestly.
48:33 - Alex Shevelenko
To bring it back to the topic, you're continuing to extend this platform, which was part of the investment thesis: creating a modern, Universal Studios-like experience on a pier. It sounds like that was the approach—creating something that grows in popularity, drawing more tourists and improving their experience.
49:04 - Shane Neman
Absolutely. There was definitely a business plan behind it, not just the idea of purchasing it. There were clear ways to improve it.
49:31 - Alex Shevelenko
As we wrap up, Shane, I’d like to try something new, but very relevant to our audience. We care about creating great human experiences, whether in person or digital. You’ve written a book about nightlife experiences, invested in amazing assets, and run teams. What are a couple of examples of horrible experiences you’ve had early in your life that taught you valuable lessons? Then, let’s wrap up with more positive lessons you’d like to share with our audience.
50:11 - Shane Neman
Yeah, actually, my book is full of horrible experiences of how I got screwed over. There are too many to pick just one—from someone giving me a credit card that ended up declining to bounced checks. What taught me the most about grit was actually going through litigation, and it sounds weird, but it was a valuable experience. My book covers the different ways I got screwed over in the industry and how I used those lessons to avoid the same mistakes, both at EZ Texting and in my investments.
51:21 - Alex Shevelenko
Maybe that's the secret advice for entrepreneurs: If you're worried about getting screwed in your industry, Shane should be your investor.
51:28 - Shane Neman
He's the CEO.
51:35 - Alex Shevelenko
He’ll be the differentiated value.
51:38 - Shane Neman
When you're young and naïve, it’s almost an asset. I don’t know if I would’ve done the things I did if I knew what I’d have to go through to achieve success—the pain, suffering, sleepless nights. I spent weeks on end working without sleep, and I’m not sure I would’ve gone through all that if someone had told me in advance what it would take.
It’s like saying, “Oh, sleepless nights in the nightlife industry?” But we weren’t sleepless for the reasons people thought. I was literally working all the time and managing a company with over a hundred employees and big offices.
As for EZ Texting—this is a long story, but I’ll keep it brief. We had some existential problems, like being sued for spam text messages. We didn’t send any, but some bad actors exploited our systems and sent out spam, so we were sued alongside them. The damages for these things are so large they can bankrupt a young company. Defending yourself in federal court is incredibly expensive.
I made it through one litigation, but it cost a lot of money, and I learned a lot about how the legal system works. I realized that if I had to go through it again, I wouldn’t survive. So, in true entrepreneurial spirit, I decided to proactively spend money to prevent being sued again. A lot of class action lawyers get paid on contingency, and they don’t have a hard stop—they don’t really care.
And so I mean, I was just a guy with a SaaS company, and then the next thing I know, I’m meeting with the FCC in D.C. and petitioning them for an exemption.
Would I have ever thought in my life that I’d be sitting in front of the FCC asking for an exemption for text messaging providers from this rule? No. But eventually, we got through it, and it really did prevent a lot of things from happening that could have ruined our business.
54:53 - Alex Shevelenko
So, the medium innovation and the distribution innovation were the whole reason for the business, but also the biggest risk factor.
55:03 - Shane Neman
Well, anytime you innovate, that’s how it goes. People find novel ways to screw you over.
55:12 - Alex Shevelenko
So, moving over to the positive, right? These could be things that you’ve done in running your company or creating environments that make the human spirit thrive. I think oftentimes we don’t think of things like Santa Monica Pier. I’m thinking of the pier, or thinking of children—memorable experiences. You’re creating a memory, which is priceless. Tell me more about it. What are you thinking about?
55:46 - Shane Neman
Actually, my latest investment is a company called Endiotics, which is a robotic pill that you can swallow. Then you get on Zoom like this with your doctor, drink a couple of glasses of water, and the doctor controls the pill inside your stomach. I’m just going to take it right now.
56:13 - Alex Shevelenko
Absolutely. Oh, it’s working. Yeah, how many hours? I can send you back the analysis?
56:20 - Shane Neman
Yeah, and they can do it all.
56:21 - Alex Shevelenko
I can send you back the analysis.
56:22 - Shane Neman
No, it’s real-time. It streams the video from inside your stomach and does an upper endoscopy for you. As a practical matter, if you want to do an upper endoscopy right now, you have to go to the hospital, get sedated, put to sleep, and it costs about fifteen thousand dollars. You also need an anesthesiologist, a gastroenterologist, and two nurses just to look into your stomach and see if there’s anything wrong.
56:52 - Alex Shevelenko
This pill... anytime there’s an anesthesiologist involved, that’s already a risk factor that this might backfire.
56:59 - Shane Neman
Yeah, absolutely. People die from anesthesia all the time—just to look into their stomach.
And, you know, they lose half a day of work to do that.
As a practical matter, the experience of having an upper endoscopy should be as simple as taking a pill and allowing the doctor 10 minutes to visually check everything. If something’s wrong, then you can go to the doctor.
But, you know, 70% of the 75 million upper endoscopies performed globally each year are just screenings—to look inside the stomach. So, why does someone have to be put to sleep for that? Why does it have to cost so much money? And why are so many people scared to do it?
Personally, I have a lot of connection to this cause. Thirty-five years ago, my father passed away from gastric cancer, mostly because he was too scared to get the procedure the year before. He didn’t want a tube put down his throat.
Just think about how many people that happens to—too scared to do the procedure because they don’t want a tube down their throat.
In reality, there should probably be 400 million of these procedures done each year, but only 75 million are, because it’s too expensive, or people are too scared.
From a user experience standpoint, imagine if all you had to do was take a pill in the morning, spend 10 minutes on a Zoom call with your doctor, and do this annually. It could prevent a lot of health issues that people suffer from.
59:05 - Alex Shevelenko
This is amazing. First of all, thank you for sharing the personal story—it means so much. You’re now in a position to help rectify the pain for other families that you went through. Huge shout out to you for finding that opportunity and making it happen.
59:28 - Shane Neman
I literally found it. I saw that they did a TED Talk in April, and I swallowed it.
And the other founder is the head of GI at Mayo Clinic in the United States.
They performed an upper endoscopy, and the next day, I literally went on LinkedIn, called them, and asked if I could come to their offices. They said, "Yeah, we're in Silicon Valley, come." So, I got on a plane, went, and we ended up funding their entire round.
1:00:01 - Alex Shevelenko
That's amazing. I think it goes back to the beginning—what are the most meaningful entrepreneurial adventures? It's the ones where you’ve seen the pain firsthand. It's not the ones where you start with a pseudo-BS MBA approach, like, "I'm going to screen through these 15 opportunities." No, you actually feel the pain, you understand it, maybe even viscerally.
I mean, I get an endoscopy every year because of this, and I literally feel the pain—know the pain, right?
It's funny, I was talking to someone recently and asked, "How did you join SuccessFactors?" They said they didn’t found it, but they joined early. I asked, "How did you know it would work?"
They replied, "Well, when we were refugees and got to the US, my mom got a job, and she got promoted. She needed to do employee performance reviews for her QA team, and I was just a high school English guy at the time. She was suffering while writing these reviews, so she asked me to help. I started writing the reviews for her employees, and I thought, 'This is such a pain.'"
In the software world, it’s kind of similar to what you’ve seen—the industry operating the old school way.
When we started RELAYTO, we saw these PDFs with great ideas—just like you, these procedures are really helpful. They could save lives, but people don’t want to engage with them because it’s painful. The consumer experience is a big part of that, right?
So, we worked on reducing friction to make it easier for people to consume what’s good for them, and that’s what you’ve done with this investment. I love it.
It ties into a lot of the themes of bringing great human experiences. We need to recognize our limitations: we're a little averse to loss, we’re hesitant to try new things, and we can be lazy. So, anything that removes friction is a win.
And it sounds like those are some of the themes that underpin whether you’re investing in storage or healthcare procedures that save lives—through better user experience for the patient.
1:02:42 - Shane Neman
Absolutely. I totally agree. I think that’s the key.
If you can invest and meet the mandate of your investment—obviously, every investment’s point is to make money—but if you can do that and, at the same time, do something amazing and good that helps a lot of people, then why not?
I always look for opportunities like that, especially ones where I have personal experience. That helps me make better decisions.
1:03:24 - Alex Shevelenko
Shane, this has been so wonderful to connect and deep dive into this. If people want to find you and learn about your investments or other areas, where can they reach you?
1:03:35 - Shane Neman
Yeah, sure. I’m really active on LinkedIn. Just type in Shane Neman, and I read all my messages there. I’m pretty active.
1:03:47 - Alex Shevelenko
Shane Neman, ladies and gentlemen—from creating memorable experiences at Santa Monica Pier to saving the lives of people who are hesitant to take the necessary medical procedures.
1:04:01 - Shane Neman
Thank you very much. Thanks for having me.