Update: on 11/1, I wrote an update post titled Progress on the Discussion Around Gender Equity at the Boulder Country Club. It gives more context on the progress in the past week around this discussion along with some additional context on the motivation for this post.
Initially, I took this post down, which I rarely do. I then got negative feedback about taking the post down. Since I rarely take posts down, I decided to put it back up with this introduction. If you are seeing this post now, please also read Progress on the Discussion Around Gender Equity at the Boulder Country Club.
Brad: Hey, Dan. Like Cindy and you, Amy and I are Boulder Country Club members, but we play tennis, not golf. Is it true that only men can golf on Saturday mornings?
Dan: Yes. Believe it or not, you must indeed be male to golf on Saturday mornings. There are a few exceptions. During the winter season, women can golf on Saturday mornings. Women can also use the 9-hole Par 3 course on Saturday mornings all year round.
Brad: Wow. Really? Women aren’t allowed to golf on the main course on Saturday mornings except during winter months?
Dan: Yes.
Brad: That’s disappointing. Why is the policy of men-only golf on Saturday mornings still in place?
Dan: That’s a good question, Brad. I’m embarrassed to say that I never gave it much thought until recently. The past few months’ events have led us all to soul search on equity, with the primary focus being racial equity. As I reflected, I began to consider this BCC policy. It was very spontaneous. The thought came to me, and I challenged myself to bring it up to the Board Chairperson and the General Manager.
Brad: I understand a fellow venture capitalist is Board Chair. I don’t know the GM. Did you approach them?
Dan: Yes. I had a Zoom call with them in August, and we had an email exchange in the subsequent days.
Brad: What did they say?
Dan: They said this issue had been brought up only once in the past 20 years. They seemed surprised that this would be viewed as a gender equity matter. They pointed out that women leagues get exclusive use of the club during blocks of time on Tuesday and Thursday morning while men get exclusive use during Tuesday evening for a men’s league and Saturday morning for men’s only usage. They said they checked with some women golfers and that they preferred this setup.
Brad: That sounds like an episode of Mad Men.
Dan: Mad Men was a great series. It illustrated how much the norms of one generation would give way to a more progressive era. I figured now that Saturday golf for men only was surfaced, it would get quickly on a path to change this relic from our past.
Brad: Did they address it?
Dan: Not yet. And, to be honest, it is unclear whether they will. They are positioning this as a golf tee time preference instead of a gender equity issue. They believe most golfers might prefer the current format, where women get the course during certain weekdays and Saturday mornings are exclusive to men.
Brad: Amy and I are members of BCC. This is the first we are hearing about this issue. Do we get to weigh in?
Dan: As I understand it, they are preparing a general survey that they plan to send only to golfers.
Brad: I view this as a gender equity issue that pertains to all members of BCC. Does BCC have a gender equity policy?
Dan: I raised this question but have not yet received a complete answer. I’m told the application process includes statements of equity. I’ve asked if there is a statement in the Bylaws or elsewhere. I didn’t get a clear response, though a question was asked during the Annual Board meeting, and the answer suggested something is in place.
Brad: You’d think this would be an easy question to address. Strange. You know, Amy and I were taken aback by the Men’s vs. Women’s card rooms’ inequity. When we got a tour as part of our interview process to become members, I remember seeing the tiny Women’s card room that stood in stark contrast to the opulent Men’s card room. We almost didn’t join BCC for this reason alone. I understand the renovation is addressing this, at least in part, which is good. Are there other examples of gender inequities?
Dan: I don’t know. I’ve suggested that BCC do a more thorough review of equity, including gender, race, and sexual preference. Perhaps this will be part of the survey, though the survey is said to focus on golfers.
Brad: So let me get this straight. They are going to focus the survey on golfers. Aren’t most golfers men? Won’t many of them be conflicted by their desire to have Saturday’s reserved for men only?
Dan: Yes. They are conflicted. I know that a lot of male golfers enjoy their Saturday morning golf. Some of them, I learned, are reserved specific tee times on Saturday mornings. I respect that the tradition of men’s-only Saturday morning golf has been an important part of their lives. This is why the overall issue is uncomfortable to address. A Y-chromosome shouldn’t be a requirement for golfing on Saturday mornings.
Brad: Changing this policy seems like a no-brainer. After all, it is 2020, and this is Boulder.
Dan: The chatter is that many golfers prefer the current system and will lobby for no change.
Brad: That’s disappointing. Amy and I know lots of BCC members. I’d like to think they would rally around changing this policy.
Dan: Most, I suspect, don’t know about it. The Board and Golf Committee haven’t shared it with the broad membership. Moreover, they are viewing it as a tee time preference issue instead of a gender equity issue.
Brad: Why are you doing this? Is Cindy a golfer? I know you have daughters. Are they golfers?
Dan: Cindy is a golfer. One of our four daughters is a golfer. I have two step-granddaughters — one is a newborn, and one is two years old. The toddler took her first golf swing in September. She needs to work on shortening her backswing.
However, my reason for surfacing this is about our responsibilities as leaders in our community. Zayo has 600 employees in Boulder, and half are women. Level 3, which I helped found, has even more Boulder-area employees. I collaborate with leaders like you to drive more inclusion into the entrepreneurial and business ecosystems. Many past and future employees of all these companies have or will be members of BCC.
Everyone I know wants golf to be a more inclusive recreation from both a gender and a race perspective. Our policies and practices need to communicate that we value all golfers equally.
For all these reasons, I’ve concluded we shouldn’t look the other way while knowing our country club has a stale male-biased practice.
Brad: Are others behind you on this?
Dan: We raised it with others, but we have not campaigned on a widespread basis. Knowing this could be an explosive issue, I didn’t want to put our fellow members in an awkward position. We are hoping BCC will raise this to the broad BCC membership in an appropriate way.
Brad: When you’ve raised it with others, what has been the reaction?
Dan: Every single person (excluding board/committee members) we’ve approached has rallied behind the need to open up Saturday morning golf to women. Several business and community leaders have expressed this support to the BCC board. Again, we held back raising this except to a half dozen or so friends.
Brad: How’s your back?
Dan: What do you mean?
Brad: I suspect you are taking some arrows.
Dan: I’m a Chicago Southsider, a cancer survivor, and a serial entrepreneur. I have lots of scar tissue on my back. More importantly, though, I have friends who have my back. If you are reading this, you know who you are, and I thank you for your public and private support!!!
Brad: For what it is worth, please know that Amy and I have your back as well!
Colorado Public Television takes an in-depth look at Colorado’s thriving startup scene in its new 5-part season called Street Level Startups.
The first episode, which is above, includes me and Jared Polis reflecting on some fun Techstars founding history, Dan Caruso talking about Zayo and the bridge between Boulder / Denver, and a great segment at the end with Brad Bernthal talking about fundraising and #GiveFirst. And, plenty of other stuff.
It was fun to watch a bunch of the old video from the last dozen years in one place. I love living and working here.
I’m intensely proud of both the amazing startup community in Boulder as well as the many significant companies that have been – and are being – created in the little town of 100,000 people I call home. I regularly talk about the ones we’ve invested in through Foundry Group, but this only covers a part of the awesomeness that is going on here as Foundry Group has a very tight thematic focus.
As Boulder continues to gain visibility as a great place to create companies, I’ve decided to highlight some of the entrepreneurs – and their companies – who have contributed to Boulder in significant ways.
Dan Caruso, the co-founder/CEO of Zayo Group, is one of them. I first met Dan around a decade ago when Howard Diamond, another incredible contributor to the Boulder startup community, introduced us. Howard was at Level 3 at the time – they had acquired his previous company Corporate Software (which I was an investor in) – and he knew Dan through that experience. Over the last decade, I’ve gotten to know Dan, watched as he’s built an incredible $6 billion market cap company headquartered in Boulder, while contributing relentlessly to the Boulder startup community.
I asked Dan to write a guest post talking about Zayo’s story. It’s great – and follows. Dan – we are lucky to have you – and Zayo – in Boulder.
“Fiber in Downtown Boulder?” was the title of an email sent to me by Brad, after he had heard from one of his CEOs that Zayo is constructing fiber in Boulder. “If true, how can I help?”, he continued.
Years ago, when I first met Brad, I didn’t “get” him. I had recently left Level 3 Communications. I was one of the day one execs of LVLT, as well as an early member of the management team of MFS Communications. It is understandable that I considered myself to an accomplished entrepreneurial-minded executive. Yet I felt so disconnected to Brad and the culture around him. It took me several more years to understand Brad, and during this time I developed a deep appreciation of his passion for entrepreneurism. I was drawn to his unique ability to promote ideas, create awareness, and fuel momentum. I sought to mimic his propensity to leverage social media.
“How can Brad help?”, I pondered.
“Help me create more awareness about the contributions that Zayo is making toward the Front Range entrepreneurial community.
Brad, entrepreneurial as ever, delegated the task back to me. “How about you write a post for my blog?”
Sensing an opportunity, I responded “How about I write two?” This is the first. The next one will describe our extensive fiber build across the front range.
I will provide a quick synopsis for those who prefer a two-paragraph summary. In late 2006, Zayo was a pure start-up headquartered behind Nick and Willy’s on 8th and Pearl. Today, Zayo has eclipsed $1.1Bin revenue and $600M in EBITDA, leading to an estimated Enterprise Value in the vicinity of $6B. We have 3 offices in Colorado, with our headquarters on the 2nd floor of 29th Street mall. In addition to directly employing 250 people across the Front Range, we indirectly employ many more related to our multi-million dollar fiber build across the front range. Dozens of recent graduates of Colorado’s university system are Zayo-ites.
Boulder is an incredible entrepreneurial community, and I enjoy being immersed in it. I am excited to see this innovative energy spreading across the front range, through Startup Colorado and other initiatives. I am proud that Zayo is a vibrant example of our community’s robust start up ecosystem.
For those who prefer a slightly longer version, here is the Zayo Story in a nut shell.
In June of 2006, we sold what remained of ICG Communications to Level 3. The ICG team went to Level 3 as part of the transaction. I didn’t.
Two years prior, ICG was a public company preparing for its second bankruptcy. My group was the only that offered an alternative to Chapter 7/11. We paid them $8.7M and took them private. By the time we sold to Level 3, our total proceeds to equity owners and management were $225M. For those without a calculator nearby, that’s a 25X return in 2 years.
Nonetheless, I was out of a job.
Though ICG was headquartered in south Denver, we opened up a small satellite office on 8th and Pearl — right behind Nick and Willy’s. In the sale to LVLT, we kept a portion of this office. One by one, many of my colleagues extracted themselves from Level 3 and pondered “what now”. By late 2006, we formed Communications Infrastructure Investments. Today, CII d/b/a Zayo Group.
Our investment thesis was simple. Bandwidth was busting — and this would continue beyond our children’s lifetimes. Fiber was the workhorse of the Internet — and nothing would alter its importance for as far as the eye could see. Most importantly, drinking too much tequila leads to a hangover that makes it hard to look at — let alone taste — tequila again.
Point 3 requires more of an explanation. The late 1990s saw a fiber tequila party that started out wild — investors poured money into start-ups and fiber networks were constructed throughout the land. Way too much fiber tequila was gulped, and the ensuing telecom meltdown caused a hangover of epic proportion. As we hit the early 2000s, investors and strategics felt their stomach’s gargle at the sight of a fiber-labeled tequila bottle. You know that feeling?
Our ICG experience gave us different perspectives. First, many fiber networks had consolidated into a handful of platform. The balance between supply and demand of bandwidth was rapidly improving.
Second, we saw an opportunity to be a consolidator of the remaining fiber properties. We called these fiber orphans — companies whose roots dated to the telecom boom but which had not yet been consolidated into a nationwide platform. These companies somehow navigated their way through the meltdown. By 2007, they were doing quite well. However, the tequila hangover persisted and few investors or strategics were paying attention to them.
Third, we developed a thesis around “Bandwidth Infrastructure”, a term we coined. We did not desire to be a traditional telecom company. Instead, we sought to provide raw fiber, wavelengths, ethernet, IP, and technical space to those entities that needed a whole lot of bandwidth. Circa 2007, this was considered a ridiculous approach. Even today, we are sometimes poked by rivals for our infrastructure approach.
Between 2007 and 2013, we acquired 25 companies. We now have over 80,000 route miles of fiber, mostly in the U.S. and London. Our fiber is connected to nearly every significant colocation, hosting, and carrier hotel facility. Our biggest customers are the wireless carriers and big content/Internet companies. We raised $2.7B of debt and $870M in equity in three rounds. Our initial investors have not sold, though they are enjoying a 4 – 5X mark. Our equity IRR has averaged around 50% since inception.
Zayo is in this for the long term… the very long term. My aspiration is to be at the helm of Zayo for a few more decades. Zayo will be to bandwidth what Amazon is to the cloud and what Equinix is to colo. Zayo will foster the development of additional start-ups, either within Zayo or as spawning-offs. The bandwidth supplied by Zayo will positively effect the lives and livelihood of countless people throughout the world. As Zayo continues its quest, it will bolster Boulder and the Front Range’s reputation as a top tier centers for Entrepreneurship and Innovation.