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Interview with Lee Kornfeld of CrowdTunes

Interview with Lee Kornfeld of CrowdTunes

Posted on 9/16/2014. Interview by Howie Rhee and Marie-Angela Della Pia

Tell us about yourself

I grew up in West Palm Beach, Florida and attended Trinity from 2004-2008. Following graduation, I spent four years as a management consultant with Bain & Company in Atlanta, GA and Melbourne, Australia. I returned to Fuqua for business school in order to learn about entrepreneurship. I love all sports and I am currently a member of the Duke Grad Rugby Club and Fuqua United Soccer Club.

Tell us about your time at Duke, what were you involved in?

As an undergraduate, I was Duke Rugby Club President, DSG Senator, and Vice President of my fraternity. I studied abroad in Venice, Italy during my sophomore summer and completed my junior summer internship with Deutsche Bank. I also owned and operated University Shipping and Storage, which ships ~200 students' belongings to and from Duke per year with ~$25K in annual revenue.

At Fuqua, I was a Section Representative, Duke Grad Rugby President, and a COLE Fellow. I spent my summer between first and second year in Istanbul, Turkey as an Endeavor eMBA Intern working for Monitise MEA (formerly Pozitron).

What's your major/program and when will you be graduating?  Tell us something about your educational experience at Duke.

I am in the process of completing my MBA at The Fuqua School of Business and I will be graduating in December 2014. I joined the Program for Entrepreneurs at the start of my first year, and since then, Jon Fjeld and Howie Rhee have been invaluable mentors to our team as we took the idea from concept to reality. In order to commit full-time to CrowdTunes, I postponed graduation by six months; I took one class during spring 2014, participated in the Duke Summer Innovation Program, and I am currently enrolled in an independent study with Jon Fjeld. I came back to Duke to learn how to start a company and real experience is always the best teacher.

Tell us about your idea.

CrowdTunes is a music management service that empowers patrons to bid on the music they want to hear from their phones. We provide a fully legal, turnkey music solution to venues that improves their bottom line through increased sales to a more engaged customer. CrowdTunes is a combination of three products:

1) Background music: The venue owner will be able to select a catered playlist that plays without interruption.

2) Mobile jukebox: Patrons will be able to choose and play new songs within the owners’ playlist.

3) Marketplace for music: During high volume periods, patrons engage in competitive bidding to move their songs to the top of the queue.

We are currently the music solution for fifteen venues across three states and we expect to be in fifty venues by the end of 2014. We are also conducting pilots with athletics departments at Duke, FSU, and USF as well as a local Applebee's franchisee with 133 locations. To date, we have had more than 3.5k downloads, 3k songs requested, and 11k credits bid with only an iOS version available.

How did you come up with your idea?  When did you come up with it?

Our CEO, Brandon Magsamen, likes to joke that the genesis of CrowdTunes came during his teenage days serving up burgers and milkshakes at Johnny Rocket's. As a server, he gave out nickels that let diners control the jukebox from their tables.

Fast forward to today, and it only made sense that patrons of a bar or restaurant should have that kind of control over a venue's music from the Internet-enabled smartphones in their pockets. Brandon came up with the idea in August 2012; he thought about piano bars and the cash you had to throw down to move your song choice to the top of the list. Shortly thereafter, he convinced me to help him figure out how to build that kind of market into a digital music service.

How did you meet your team members?

We started as Duke MBAs with an idea and built out the business case through Fuqua's Program for Entrepreneurs. We recruited undergraduate developer and co-founder, Davis Gossage, to build the alpha application using a grant from Duke to fund his work. After successful trials in the local area, we brought on a pair of senior developers and serial entrepreneurs, Rob Witman and Phil Jacobsen, as equity co-founders to build the beta application and lead development in the future.

Our team has 40+ years of engineering experience, 30+ years of start-up experience, 10+ years of management consulting experience, and we have founded a total of five companies. We are passionate about solving difficult problems in order to positively impact others; we have raised money for cancer research, built productivity- based mobile phone services, and moved students' belongings in a 26 foot Penske truck.

How has the Duke Start-Up Challenge been helpful to you?

The Duke Start-Up Challenge has been integral to the success of our business to this point. While we did not make the Grand Finale in 2013, we got invaluable feedback and connections through the competition, which helped us secure funding for Davis to build the prototype that summer. This year, the Duke Start-Up Challenge is linked directly to the Duke Summer Innovation Program, so we received additional funds to grow the business this summer. Perhaps most importantly, going through the rigorous application process helped us win a $46K NC Idea Grant and continues to pay dividends as we work on raising a seed round.

The Duke Start-Up Challenge provides a lot of feedback from over 100 judges.  Can you talk about that experience of reviewing the feedback?

Reviewing feedback is always a bit of a harrowing, and somewhat manic, activity but is critically important for the healthy growth of our startup. In this case, with so many judges, the feedback was diverse and generally very helpful. It is important to us to be able to address the feedback we received from the judges in order to continue to strengthen our company. These judges have "been there and done that" so their feedback is generally very valuable to help you see around corners in the future. That said, there were some comical moments when the feedback two judges gave would be in direct conflict with each other. That was a strong reminder to take all feedback graciously but with a grain of salt.

What advice do you have for Duke students that are thinking of starting a company?

Stop thinking and start doing. In some respects there is no better time to start a company than as a recent graduate when you have a low(er) standard of living, relatively few obligations, limited commitments and plenty of fall back options. One challenge that you will face is lack of any sort of industry expertise which you can, and should, round out your team with through strategic recruiting. The second piece of "stop thinking and start doing" is very literal. A lot of time can be spent thinking about something but those that are successful actually do something about it. Start doing things in pursuit of your entrepreneurial passion or aspirations and you will be far more rewarded and successful than those that simply pontificate about their ideas. Spend your time doing things that answer questions and de-risk your idea in order to help you truly build something that is valuable.

Anything else you’d like to say?

We really appreciate all of the help we have gotten along the way and we want to give a special thanks to Jon Fjeld and Howie Rhee for all of their hard work; we never could have gotten this far without you.

Join us for the Grand Finale with Max Hodak ’12 for the 15th Annual Duke Start-Up Challenge on Friday, September 19th, 2014 at 8:00pm ET at Fuqua’s Geneen Auditorium. RSVP on SquadUp

Not able to attend in person?  Watch the livestream on Duke’s YouTube channel

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