Paul Inouye was born in San Francisco and grew up in San Carlos, and am one of three brothers.
Paul attended Bellarmine College Prep in San Jose, UC Berkeley, and The Wharton School at the University of Pennsylvania for my MBA.
His hobbies include cycling, running, swimming, Crossfit exercise, travel, skiing, 80s music, EDM, 80’s movies, reading, military history, and fantasy football.
Paul played both high school and collegiate Rugby and has completed The Vineman Ironman, the Vineman Half Ironman, the Hawaiin Half Ironman, and the San Francisco, Avenue of the Giants, and NYC Marathons.
He has worked in finance for over 30 years as a technology investment banker, having worked at Robertson Stephens, Morgan Stanley, Piper Jaffray, Lehman Brothers, Perella Weinberg, and Moelis & Company.
Paul Inouye is the father of two children Miles and Sutton.
How did you get started in this business?
My path into the world of finance and investment banking was one of pure serendipity. I was about to graduate from Cal and had no concrete ideas as to what I might want to do for a living. I had previously worked as a summer intern at a law firm and quickly decided that the legal field was not a great fit for me.
As I started considering other professions, I recall asking friends two questions about jobs that I might pursue. The first was “What is a really challenging job that only hired the very best candidates?” The second was “What job paid really well?” It was with these two parameters that I learned more about both the consulting and investment banking fields. As I interviewed more, I really became drawn to the latter. I recall having three different offers in banking, each with its different dynamics. First, I had an offer to join Kidder Peabody in NYC which was a very old blue-blood bulge bracket firm with a long and storied history. I recall flying out to NYC for my final interviews and marveling at their Wall Street offices and straight out of central casting bankers and professionals. I was taken out to dinner after being given my offer and then heading out for drinks at some of the most storied and famous bars in NYC at that time including Kettle of Fish, Chumley’s, McSorley’s, Live Bait, and the Limelight club.
My next offer came from Drexel Burnham Lambert in Beverly Hills where I received an offer to work in mortgage-backed securities. I recall being given a tour of the trading desk and seeing Michael Millken’s infamous X wing desk. Their offices were modern and sleek and quite the opposite of Kidder Peabody’s NYC offices.
My last offer came from one of the “Four Horsemen” of San Francisco banking, Robertson Colman & Stephens. I was offered a job in their new and growing m&a group and would support both our healthcare and technology practices. I was attracted to the entrepreneurial spirit of the firm and its founders and felt like I had found a real home. Their offices were on the 30th floor of Embarcadero 4 with dramatic views of the Bay and CIty.
I had little formal training in finance or accounting but the firm liked to hire highly motivated young talent and I was truly grateful for the start they gave me in the industry. I recall working literally 80+ hours a week for two years, on holidays, birthdays, and thru vacations, and yet I loved every minute of it as it was a phenomenal environment of captivating energy. The team there was incredibly talented and smart and it was a place where I was constantly learning and growing as a professional.
I ended up working there for nearly a decade and will always recall it as some of my happiest and most fulfilled days in banking.
How do you make money?
We are entirely aligned with our client’s interests as we earn our fees upon successfully closing transactions for our clients.
How long did it take for you to become profitable?
It takes only completing a single deal to have a profitable year; however, my goal is to build a healthy pipeline of multiple deals per year as we continue to scale the business.
When you were starting out, was there ever a time you doubted it would work? If so, how did you handle that?
Yes, I think most entrepreneurs always have a moment of self-doubt and wonder how they are going to build their own practice. My own mindset was to focus on all those activities that I could control that could impact the success of my practice and not worry about those things that were outside my control. I knew I was a very capable banker with over 30 years of west coast tech banking experience who had an extensive network of contacts and deep domain expertise.
Someone once asked me “How do you eat an elephant?”. The answer, he said, was “One bite at a time!” It is with a mentality that I don’t try to take on too much on any given day but instead simply focus on the immediate task at hand and, once I complete that, I move onto the next. This philosophy allows me to stay in the moment and not get ahead of myself or my capabilities from day today.
How did you get your first customer?
My first clients have come from my own professional network as I have lived and worked in the Bay Area for over 5 decades having attended high school and college locally. I also built a valuable network of friends and colleagues from business school that I still leverage today
What is one marketing strategy (other than referrals) that you’re using that works really well to generate new business?
I recently purchased a very large database of founder bootstrapped businesses that a competitor had built over the last 20 years. He recently decided to retire and we negotiated a buyout of that database.
I invested in both a CRM system and sales enablement tool that allows us to set up email campaigns for the founder of these businesses in order to build a dialogue and relationship with them. I recall thinking that typical emails campaigns have a less than 2% open rate and thought about how to materially improve that conversion rate. After several drafts and trials, we have crafted a very impactful note that has resulted in a nearly 30% response rate which is far beyond what I ever thought we might achieve. While it is still early, I am very optimistic about our marketing progress to date.
What is the toughest decision you’ve had to make in the last few months?
The best and toughest two decisions I had to make were 1) hiring a junior team and 2) making the investment in both purchasing the database and the tools and technology around it. The first took a lot of time and effort but without the two associates I hired, I would not have been able to scale my business to ensure its success. Both hires are extremely talented and bright and I am extremely grateful for both.
The second decision was much more challenging as it required me to go “All In” on my firm. The database is extremely valuable and costs a significant amount of cash to purchase. I initially fretted greatly about making this cash outlay but my entrepreneurial friends with whom I consulted on the decision encouraged me to be bold and aggressive as it created a huge competitive moat for my practice.
What do you think it is that makes you successful?
I think three factors have contributed to my success. First is very deep confidence and resilience in my own capabilities. I have had a very successful career in banking as a result and, while I am humble enough to know that I don’t have all the answers, I know that I am a very strong problem solver with great tenacity.
Second, I am more of a risk-taker than I realized and have shown an aptitude to make smart calculated bets on my practice and myself.
Lastly, I have a great cadre of friends whose advice and judgment I trust and have frequently relied on that to bounce ideas and concepts off of. Their support has been invaluable.
What has been your most satisfying moment in business?
I have been fortunate to have had many satisfying moments in banking but the most satisfying moments have been when I have worked on transactions with my close friends in helping them achieve successful outcomes in selling their businesses. Nothing beats that feeling of ensuring a great outcome for those I have known for a long time and with whom I have a strong friendship.
What does the future hold for your business? What are you most excited about?
What business books have inspired you?
Never Split the Difference by Chris Voss. Negotiating is an everyday part of our lives and can be difficult and challenging; however, this book provides insightful and actionable strategies to become a much more effective and successful negotiator. Several of its keen insights are that negotiating requires emotional intelligence, building a connection with the other party, being mindful of the tone of voice you use, not compromising or accepting a counterparty’s deal and taking your time, and being patient to make the best deal.
Good to Great by Jim Collins. I loved this book from cover to cover and its discussion about having the right people on the bus really resonated with me. Too often, especially in my field, challenging but highly talented professionals are not just tolerated but sought after. I firmly believe that one has to have a different standard to truly build a practice that will thrive. His other concepts including Finding your Hedgehog strategy, Adopting new technologies that can help your business succeed, and Confronting challenging facts head-on without losing hope, have all been invaluable lessons for me.
Grant by Ron Chernow. I majored in History and Political Science at Cal and have had a lifelong love of reading autobiographies of some of the most iconic figures in modern history, including Winston Churchill, Theodore Roosevelt, Abraham Lincoln, George Washington, John Adams, Sir Edward Shackleton, Thomas Jefferson, and Lewis and Clark. My favorite, however, amongst all these supremely talented individuals has been Ullyses S. Grant as his story arcs the lows and highs of what it is to be human. Born of very modest roots, he was a mediocre cadet at West Point and fell onto very hard times before the war selling firewood on the streets of St. Louis only three years before the Civil War. He then catapulted to the very highest rank of the Union Army within 3 years but not before having several setbacks in which he nearly resigned his commission. As commander of the Union Army, his success was based on his ability to read the psychology of the opposing Confederate Generals, his ability to see the battlefield and ways to exploit his enemies, his dogged resiliency and aggressiveness, and his ability to find capable lieutenants such as Generals Sherman and Sheridan. He then rose to the Presidency of the United States and helped chart the Reconstruction of the country and helped African American males earn the right to vote thru sponsoring the 15th Amendment. He was a man of impeachable values but also a deeply flawed man who was often beguiled by those around him who naively never suspected treachery based on his own lens of kindness and higher values. He nearly died a pauper but through his own immutable perseverance to leave his wife and family a means to live after his passing, he completed what is widely regarded as of the greatest memoirs of all time only 7 days before his passing. His courage, tenacity, modesty, care for the less fortunate, and deep humanity are a testament to a noble and deeply meaningful life. While not a business book per se, Grant’s tenacity, vision, decision making, and judgment are all hallmarks that also apply in a business context.
What advice would you give to your younger self?
Fail Forward! I would encourage myself to take more risks and bet on myself more aggressively. Most professionals in banking are risk-averse and prefer to work within the confines of a larger organization but I have found that I truly flourish as my own boss where I can operate with ultimate flexibility. Taking calculated risks not only makes sense but provides valuable lessons for growth and improvement.
Are you willing to be a mentor? If so, how should someone contact you?
Absolutely! I am happy to provide any advice or insights that someone thinks they might be able to gain from my own experiences.