Every quarter, the Arizona Technology Council publishes its eImpact data report showcasing the performance of the technology industry in the state. We’re now adding an additional layer, with the stories of the people behind the numbers—the people who are the employers and employees, the innovators and investors.
Gregg Scoresby is CEO and Founder of CampusLogic, a Chandler-based SaaS company that removes financial barriers to higher education with the industry’s only Student Financial Success platform.Scoresby has a long history in Arizona as a tech entrepreneur, investor, and mentor.
He joined Molly Castelazo, storyteller-in-chief at Castelazo Content, in a lively conversation that ranged from Arizona’s entrepreneurial ecosystem, to when to raise money, to the best tacos, to the broad impact of mission-driven companies. The full transcript, edited just for clarity, is here, with timestamps to ease navigation through the video.
[01:12] Have you always lived in Arizona? What do you love about living here?
I was born and raised here. My dad moved to Arizona to become a high school counselor at Westwood High School the year it opened, which I think was 1963. And so I grew up in Mesa. I went to BYU for my undergraduate work, and then went to Cornell for grad school in New York. I worked in New York for a while and then moved back to Phoenix and I’ve been here ever since. My wife is also from Phoenix. She went to Arcadia High School. We’re Arizona people and happy to be here. Wouldn’t live anywhere else.
I think Phoenix is a really interesting mix. Metro Phoenix is a really interesting mix of people. You’ve got, of course, a bunch of Midwestern migration and just the general migration happening in the U.S. from northern states to Sunbelt states. And then, of course, the Latino influence here is great. And if you’re like me and think you need to eat tacos 24/7, there’s no better place in the world than here. But I like the people here. I like the local tech community in particular. One of the words that’s been used to describe the community is generous, and I think that’s true. There’s a real spirit of generosity and camaraderie. People that come from other places are surprised how open and accessible other people are and companies are. So. I love that aspect. Just like the people and the culture here.
[02:55] What do you think is behind that generosity? Is it something about the culture here or the types of people or the types of companies?
Well, there’s probably a couple of reasons for it. I mean, a lot of people are from somewhere else, you know, so not many of us are natives here. So people are naturally inclined to form new relationships and create, you know, an extended part of their family, so to speak. So there’s probably some of that. And then I think in general, just the West, having lived on the East Coast, you know, just people’s willingness to there’s a level of anonymity maybe in other cities that doesn’t exist here where people are just are more inclined to be open. And what we might call warm, you know, versus other cities on the East Coast, for example. But I think that I think there’s just some of those dimensions. Bring out just a warmer welcome. Warmer, warmer connection with people.
[04:09] Did you ever think about moving CampusLogic somewhere else?
Yeah. In fact, I got asked a lot by investors, ‘Hey, what do you think about moving to the Bay Area? And my question was always, ‘Why would I do that?’ There are situations where it does make sense to be in a different a different geography. For example, this is a simple and obvious example, but if you want to become a banana farmer and grow bananas, I probably wouldn’t do that in Arizona. Maybe I’d do that in Honduras or something like that. Right. Or somewhere where it’s just easier to grow bananas. So if you’re doing a really large consumer company that was going to take billions of dollars of capital to get off the ground and scale, think about something like Uber where you’re doing something super transformative, where both the technology, the regulatory, the capital required to open new markets was huge and you’re solving some really complex technical problems and trying to scale up a consumer network – I think that might possibly be easier in other in other geographies. It’s probably becoming even less and less and less true even on that side.
But most of us are building companies where domain expertise is required. So in our case, I’ve been in the financial aid industry for almost twenty five years now. And so when we talk about student financial success, we’re talking about eliminating the barriers to financial aid. So if you’ve got domain expertise in that area and you can build a team and build great software against that set of problems, you can do that anywhere. And actually, for us, there is there’s a lot of great education talent here between Arizona State University, University of Arizona, Grand Canyon University. And then some of the larger online schools have also had a big presence here. So there happens to be a lot of talent for us here. In addition to that, I think you can build a great company for the most part, anywhere these days.
[07:43] Does the quality of life in Arizona make it easier to develop talent here?
Yeah. About forty-five days ago, we acquired a company that was based in San Francisco. And I can tell you firsthand, the cost of their delivery was, you know, 50 percent higher than ours. And in the cost of talent, the cost of office space, everything’s more expensive there. And we hired a bunch of great team members that came along with that. They’re awesome people. Glad we hired them, but comparable talent to what’s here. There’s not a unique skill set that’s there.
I’ll tell you one thing that I do think that’s unique about the Bay Area that I think we need more of here, the mindset of going big. I’m going to build something big and meaningful. That’s in the water in San Francisco. Right. And a lot of people here maybe start off thinking, I’m going to build a lifestyle company or some smaller company here. And it takes a while for maybe some people to realize, well, I could build a billion-dollar company here if I really, really wanted to get after it. So I guess that’s the one thing. And I think that’s changing. You’ve seen that change in other cities as well. I think that’s one thing that is changing here now where people want to build something big and meaningful and enduring here, whereas people have focused on that for 50 plus years in the Bay Area.
There have been a good number of success stories out of Arizona. What are some differences in the types of companies that they might not need that much capital? Or is it is there almost like an invisible sort of imaginary feeling that people feel like I’m not going to build a billion dollar business or a multibillion-dollar business in Arizona?
Well, there’s probably I mean, some of it’s just maybe not realizing what’s possible. So if you look in other cities, take Austin, Texas, where I think Dell was built there, and other companies that have been built there with their second third generation people that started off there. And they’ve seen something else been built, built big there. I think that once you’ve seen it done, you start to realize, hey, I could do that, too.
You see that in Salt Lake, for example, Novell and WordPerfect were there 40 years ago or something like that. And then that’s you see, people leave those companies and start multiple companies after that. I think you’ll see that here. I think you’ll see people that leave have left and will leave Infusionsoft – now Keap – you’ll see people do that at CampusLogic. Some of our former employees are at some of the high growth software companies in town. You’ve seen that at WebPT. I think they’ve built a really remarkable company as well. And so I think you’re starting to see that already. But that will be really obvious in 10 or 15 years where you’ve taken a handful of companies that have really scaled and turned that into one hundred companies that are in the process of doing the same thing.
[11:48] What’s exciting about the tech industry in Arizona right now?
Some of us may need to go import external talent from time to time, but by and large, there’s just a ton of talent here. So Arizona State University. University of Arizona. Grand Canyon University. They continue to crank out a lot of qualified young talent that that we want to make sure that we can retain and have them be part of the growing tech ecosystem here. So I’m excited about the talent for sure.
And then, you know, I just continue to be surprised. I think our tech community is really connected. But I continue to be surprised with new companies popping up all the time. There’s a new software company every single week. I find out about this. It’s got a product. They’ve got revenue. They’re starting to scale. They’re starting to raise capital. And so, you know, I think I’m super excited about that. That was not something you saw 10 years ago happening. So I love that. I love the velocity with which new companies are being formed here as well.
[13:52] Do you see a robust community of investors, yourself included, in in the state who invest in Arizona companies? Of course, there is, you know, exponentially more capital even in states other than California. Do you see any trends in more venture capitalists from the Bay Area or other places being more willing to invest in Arizona? Or do you think a lot of that growth is going to be supported by investors who are here already?
Well, let me give a couple of answers to that. I mean, I I’m talking to investors all the time and I think there are a lot of investors who are trying to invest more here. So I’m going to give one answer that’s not going to be very popular. And I I’ve just heard for years and years we’re really focused on ‘There’s not enough capital here.’ One other perspective is there is not enough company formation here. So if we had more entrepreneurs starting more companies and wanting to really scale something big here, I promise there will be plenty of capital here. You don’t have to have a bunch of venture capital firms with an Arizona address to have sufficient capital to scale here. That’s just not the world we live in anymore. So, one, I would say, you know, that’s that we kind of need to get over the idea that there’s not enough capital here now.
Now, having said that, there are pockets where I think we’ve got deficiencies. It is very hard if you’re raising $250,000 to $1 million, that amount of money, to get your company started is almost inherently local. It’s going to be friends, family, angel investors. So I do believe, notwithstanding what I said previously, for those check sizes, we do need to activate the local angel network even more like we need to 10x the number of angels here that are knowledgeable and experienced in building companies that want to invest here. And part of this just comes with more people building companies and then having exits or financing events where they can themselves become investors. So I think that I think that’s a part of it.
And then I’ll give a third answer here. But just to summarize on the first part, we definitely need to activate more angels for very, very early stage investment. And two, we just need more company formation in general, more people to take the plunge and pursue their idea and try to build something big and meaningful. And if you can get past this a little initial hurdle, there’ll be plenty of capital from other sources. I mean, I get emails all the time from venture capital firms out of state asking ‘Who should I talk to?’ And so I think there is this enormous – it’s not like people don’t know there’s top talent here or know that this is a great place to build a company. They’re looking for places to invest. So I think that, you know, that’s my perspective.
The last point I’ll make is this relates to company building in general and starting companies here. I do think when maybe someone’s starting their first company for the first time, a lot of people think I’m just going to. I love my business. It’s incredible. I’m going to put together a pitch deck and I’m going to raise all the money I need. And I think that raising capital is way harder than what people think when they start doing it. It certainly was for me. And so, you know, I talked to when I was raising our angel round, I mean, I, I sold everything I had. My wife and I went all in on this business. It wasn’t enough. I used to have like a breakfast to raise money, followed by, like, my second breakfast meeting, you know, followed by like an early lunch, followed by my late lunch. And I put on like 15 pounds when I was raising money.
But, you know, I talked to hundreds of investors, literally hundreds of investors. So sometimes I’ll ask these early stage founders, they’ll say ‘I’m having a hard time raising money.’ And so I’m going to ask ‘How many people have you talked to?’ ‘I’ve talked to about 10.’ And I say, ‘Why don’t you try talking to a couple hundred and then let’s talk about it.’ I mean, well, one of the things that happens is you get better at telling your story and you start to build muscle around raising capital because it’s a skill that that is required. And so, I do think that sometimes the expectation that capital raising is going to be easy is a little bit misguided.
[18:10] Any other advice that you’d give to someone who’s toying with the idea of starting a tech company?
Well, I do think that sometimes people think ‘I’ve got to have capital before I can do anything.’ And like, almost for sure – 99.9999% of the time – that business is never going to go anywhere because it’s really hard to have investors, even your friends and family. It’s really hard for them to give you money when they can’t actually even see anything other than a PowerPoint presentation. So I do think you’ve got to figure out how to get a product going and maybe you can’t quite get it done, but you’ve got to be able to move the ball forward without waiting for capital to come your way.
And so my advice is figure out what’s the next milestone you need to get to. And if you can do with no capital, then do it. And of course, nothing, nothing speaks more loudly than actually having customers use your product. So I know a lot of us feel like, and it’s true, we need to have money to build the product in order to get the customers. But most people have built a prototype or piece of software that’s workable with no outside capital. Those dozens of companies that are successful, they will make that first step.
So my main point of advice on getting something started is don’t assume that capital raising is going to be the first hoop you’re going to go through to build your business. It’s probably going to be the second or third. You need to build a prototype, get a product going, somehow – find gifts, give up some equity to a technical co-founder, if you’re not a software developer, to figure out how to how to do that.
[20:06] CampusLogic just received $120 million funding from Dragoneer Investment Group. What drove that decision for you and what are your plans with the with the funding?
Well, just to just to fact check you on one thing, I never said I didn’t sell everything that wasn’t nailed to the floor. I did sell things that were nailed to the floor and I sold the floor. I went all in. So on the Dragoneer investment, one thing that I got some really good mentoring from Clate Mask, the founder of Infusionsoft (now Keap). And early on, he was one of my very first seed investors and was previously on my board. And he’s been a great mentor to me throughout the growth of our company. And he spent some time – this is, you know, probably like six or eight years ago now – really talking to me about the process of raising capital because he had gone through capital.
And so I’ve tried to build a lot of muscle around and a lot of strength and knowledge and experience around the capital raising process. So it’s become pretty comfortable to me. But it hasn’t always been. It’s a skill like any other that you have to develop. But one thing I learned in that process is I talked to investors all the time. I still do. I don’t think we’ll ever raise capital again. We don’t need to raise capital. We’re cash flow positive and growing really, really well. So I didn’t think we’ll do that. But I still talk to investors in part because it’s a network that needs to be maintained. And I want to give people an update. You never know when they’re going to show up with a company for us to consider acquiring or merge with or anything else.
And so partly what I think your question was, how did the Dragoneer transaction come about? And partly why I mentioned that is I you know, I’ve known the folks at Dragoneer for a few years, long before we were ever kind of in their size range. I built a relationship with them and then I’d give them an update every six months or so, maybe sometimes every three to six months. And then when I was in San Francisco, I’d shoot them an email and say, I’m in the Bay Area. Can I just stop by your office and say, I’ll give you quick update?
Last summer, I did the same thing. I’d known them for a couple of years already and, you know, showed up and gave them an update. And we weren’t out raising capital. But they said, ‘Hey, we’ve been tracking you for a couple of years. We love what you’re doing. We love that. We love the category you’re creating called student financial success. We love the growth rate. We love the team that you’ve gotten, the momentum that’s been built. We love higher education and love the end market. And like the product portfolio. We know you’re not raising capital, but we are investing capital like we’re ready to invest in in a business like this. We want to do some diligence on the business.’
But so it was pretty natural. So I’d known them for a little while. And then they did a bunch of pre-work long before the diligence. And then they moved into the diligence phase and then they moved into the closing phase and then on to my board. It’s just all been a really natural relationship. But it’s not in the last six months – it’s been in the last three years that that’s happened.
So if you think you’re going to build a company of any substance and you think that business is going to require capital to grow, I give you the same advice that Clate gave me. Which is learn how to raise capital, become an expert in raising capital, and then constantly be out there cultivating the relationship with investors and giving them the update and bring them along. So when it’s time to raise capital that the right investor is there for you.
[24:33] What’s your vision for the next 3-5 years for CampusLogic?
You know, we just did one acquisition right after we closed that round of financing. And I suspect we’ll do more acquisitions. I also think that the higher education industry is probably going to go through a little bit of a transformation. So I think that it’s easy for us to think that we’re in pandemic mode and we are in pandemic mode. But I think in general, our industry is being transformed like so many other industries. So digital transformation has been going on for a long time. This isn’t new and we’ve been part of it. The idea that you can tell a student, ‘Hey, why don’t you drop these documents off at the financial office or why don’t you fill out this application for a scholarship?’ You know, that needs to be on every student’s mobile. It needs to be completely simple, completely self-service, completely available at all times. And so that has accelerated.
Our customer retention is the highest it’s ever been. I mean, our customers are seeing us as a business continuity strategy. Our growth continues to be really strong. Our second quarter, our new sales were the second highest quarter we’ve ever had. So, you know, I think that we’re going to continue to benefit from the acceleration of digital transformation that’s happening in higher education. And I also think there’s going to be some new opportunities for us too, even beyond student financial success in the coming years. We have a really good product development engine and a really good go to market engine working. And when you have those things in a particular industry with a lot of strength, there’s just a lot more opportunities that tend to come to you along the way.
[26:33] I want to take the last minute and just ask you a personal question. What’s your favorite taco restaurant? And: What are your hobbies?
Well, because I live in East Valley: Backyard Tacos is always good. Boca Taco. Although I tell my friends at Boca, from what I understand, I’m not a Spanish speaker, but Boca means mouth. I don’t know why you name your restaurant Mouth Tacos. But OK, I guess. I guess that can make sense. The best shrimp taco in Arizona can be found at Boca Taco. So that’s good. Mango’s in downtown Mesa is really good too. Those are a few places.
This is really sad to say, but I don’t have any hobbies. I’m actually pretty boring person. My wife and I do foster care. We have a new foster kid staying with us now. So you know, we’re home every Friday, Saturday night. We’re pretty boring people. And then in the winter, if I can sneak some trips up to Utah and go skiing. And that’s always one of my favorite things to do. And when it’s not so hot like it is now I’ll try to hike a little bit, you know, around here. But those are those are some of the things. But I’m for the most part, it’s tacos and family. Really boring.
What a great way to give to the community in a very different kind of way. To be a foster family, you know that you’re giving the community a lot as a mentor, as an entrepreneur, as an investor, and then do it as a foster dad is pretty cool.
Well, I always want to say, to be clear, like my wife is the foster parent. And I’m her husband. That’s actually probably a little more realistic. To be fair, I mean, I like it, too. But we do that because she’s remarkable at this and just has a passion for it. She’s a social worker by training.
There’s too many kids in in the foster care system in in every state. Arizona is no different, candidly, we understand in Arizona and in every state on foster care. So there is just there is more need and it’s a totally worthwhile to do. I don’t think this is for everybody. But for us, this has been a really remarkable thing to do this on a temporary basis when kids need a place to stay for a period of time until they can hopefully reunite with their families. And so it’s been a really rewarding thing to do. I do. I do feel well. We have a lot of passion for that.
I think about, you know, other things that are problems in the world, and I really do think company building can be a positive force for good as well. And that’s something that I just care a lot about.
Company building provides opportunities for people to have meaningful gainful employment, then that helps families. And I mean, it’s a virtuous cycle for sure.
Yeah, I think there is, of course, a lot of good things in this world and there’s a lot of good influences. There’s a lot of good organizations that do a lot of good. But if you can help people have purposeful work, they can connect their personal mission to the mission of the organization, and you can do something hopefully like we’re doing. We’re helping schools change lives and trying to remove the friction that prevents students from getting to and through college, through these personal financial pathways that our software provides. It’s really powerful. So, I do think company building, particularly mission-driven companies, have the ability to change the lives of their customers and in our case, our customers’ customers, which are students.
And of course, and perhaps as importantly, your employees. If you create just a great place for them to do purposeful work, it betters their lives. It betters their family lives, and it makes communities better. So, I love the impact that building healthy, productive companies and particularly mission-driven companies can have on can have on local communities and the families in those communities.
Visit https://campuslogic.com to learn more about CampusLogic.
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