Ludwig Schoenack, MBA ’19, Kyte
Kyte is a cars-on-demand service connecting users with privately owned vehicles. Co-founder Ludwig Schoenack shares his experience building the company, and touches on some of the challenges and opportunities of growing his startup in the midst of a worldwide crisis.
What have you carried from your Berkeley experience to your work in innovation/entrepreneurship?
The biggest point was “Challenge the Status Quo”, one of the core Haas values. That’s truly in our DNA as a company given that we take on an entire industry and challenge the way they’ve operated for decades. Beyond that I’ve learned to look out for my society and community in a much more deliberate way. When COVID-19 shattered our industry, we kept our cars on the road, implemented new health and safety standards within days and offered our cars for free to healthcare workers as our competitors were shutting down.
Knowing what you know now, what would you have done differently at Cal, or what programs/activities/etc. would you have taken advantage of to prepare for your career in innovation?
I wouldn’t have done anything different but I would have started all of it earlier. I attempted to start two companies before starting Kyte with my Co-Founders. With more time, I could have done more, moved faster and gotten more diverse perspectives.
What advice would you offer students just beginning their careers in the startup world, either as founders or as early team members?
Learning is immensely valuable. Only after some time operating did I realize how “expensive” learning can be as an individual and as an organization. Also, you will always get 2x of what you put in. This might not be news to everybody, but to me it certainly was. Nothing is for free but if you put in the work, the dedication, and the hustle, it pays off exponentially.
As a serial entrepreneur, what have you learned from previous startups that inform which ideas you choose to pursue as opportunities arise? What can aspiring entrepreneurs do to increase their ability to succeed in the startup world?
“Build something big.” Building a small startup is essentially equally as hard as building a massive company. The vision is important here. It’s ok to start small, but Elon Musk didn’t want to [just] build an electric car (which was crazy enough) – he wanted to build the best car company in the world.
What’s the hardest thing about your work in a growing company? What keeps you up at night?
The expectations our team has in me as a founder and leader is what keeps me up at night. Our founding team doesn’t have all the answers, and many of the things we do, we’ve never done before. But we’ve grown our team with some exceptionally sharp and ambitious individuals so they have high expectations. Living up to them is a hard thing.
How did you bounce back from your early failures and use those experiences to fuel your later successes?
Before Kyte, we initially built a business that had two flaws: It lacked the business fundamentals in a way that we weren’t clear on revenue streams, unit economics and how it would become a machine that can fuel itself as fast as possible; and we didn’t think big enough. We built a business that had an upper limit, which prevented us from being able to dream really big when tough times came. When we started Kyte, we built on an existing industry with a proven profit equation over decades that we’re now improving. Also, the shared transportation market is well over $100B so we have enough room to grow.
Do you think it is better for first-time entrepreneurs to join a startup, or to start your own company? How do you evaluate your employment opportunities?
It’s an individual choice. I would argue that if someone is inclined to evaluate their employment opportunities in the first place, they should join a startup. One day, you’ll be more obsessed with solving a problem than you are with your employment opportunities - that’s a good time to start solving that problem and build a business around it.
As an entrepreneur, you’re told to push through barriers and face down rejection. How do you know when it’s time to pivot or sunset a project you’re working on?
Great question. It’s hard. As an entrepreneur, you’re the one who believes most in what you do. If that confidence fades, it’s time to ask yourself why you’re struggling to believe in the future that you’re trying to convince everybody will become a reality. Is it because everybody is against you (which happens), or because you’ve discovered serious flaws?
Has Berkeley been helpful to you in your entrepreneurial endeavors? If so, what have you valued most about your interactions with Cal or the resources it provides?
The majority of our engineering team is from Cal. Biggest win.
What’s your (or your company’s) biggest challenge or hurdle at your current stage?
Demand in our industry has currently evaporated as governments shut down entire cities and residents fear contagion in the middle of the COVID-19 pandemic.
What’s the most exciting opportunity at this stage?
The [current pandemic] crisis, I like to believe, is also an opportunity. When we come out of this phase strong, we face a more favorable hiring market, lessened competition and lots of available capital for good companies that have made it through. The companies that survive can become massive.
What resource/s would be most valuable to you to help you attain your next milestone?
We’ve shifted a lot of our growth efforts to business customers getting essential workers where they’re needed most, as an alternative to air travel or shared transport. We’re looking for more corporations to work with during this time and tighten our product offering for B2B.
Where do you want to be in 3 years?
I want to be here, leading the Kyte team through international expansion.
Lastly: You’ve chosen to make the Berkeley Founders’ Pledge. What inspired you to do that?
It’s the right thing to do. As an entrepreneur, my financial outcomes are very binary: Either I end up with nothing, or with lots of luck I end up with an outsized financial return for the time I’ve invested. I aspire to use some of that money towards empowering more founders to arise out of the university.
Interested in joining Ludwig in his commitment to Cal? Make the Berkeley Founders Pledge, like he did, and have an impact from Day One of your latest venture.