When Wilson Kriegel worked for Enron, the energy company was one of the biggest in the world. Its reported revenue dwarfed that of Microsoft and Goldman Sachs combined in 2000, and its share price hit a high of $90.75 that year, effectively making Kriegel a millionaire.
Then it all came crashing down. Enron’s executives had been lying about revenue while keeping debt off the books. By 2002, Enron’s shares were down to $0.26, and the failed giant was forced to file for bankruptcy. Kriegel, who had worked within Enron's spinoff energy company, The New Power Co, had lost everything too, including his job and home. His sister, who had also immigrated from France to New York, took him in. After months of living on minimum wage, Kriegel decided to start his own company, lifting himself out of poverty in the process.
Since then, Kriegel has paved his way as a serial entrepreneur, founding or helping run startups OMGPOP (sold to Zynga), Curse (sold to Twitch), and PicsArt. Today, he's the founder and CEO of ROBN, a tech startup that makes activewear vests that play music and take calls for those on the go who don’t want ambient noise shut out by headphones.
We talked to Kriegel about his biggest passions, entrepreneurship, and staying active. According to him, work-life balance is key for physical and mental health, especially when things go wrong. The transcript below is lightly edited for clarity.
B2: Tell me about your time working in e-commerce at Enron.
Kriegel: I worked for Enron from 1999 to 2002. Until that summer, the same month or so that Jeff Skilling left the company, when I also left. I joined, I did one year in commercial banking in '98, and then there was the Asia Crisis which hit. I worked at Sumitomo Mitsui Bank, which was the largest Japanese bank. We were financing power plants, oil rigs’ credit lines. Enron happened to be one of our creditors for power plants.
During that time, I was doing a lot of day trading and writing business plans. When the Asia Crisis took place through some hedge fund issues, somebody mentioned that I should apply to Enron, that they would like my personality. I ended up getting hired in a unique group that was basically a strategic analytical group that evaluated all the e-business opportunities for the company.
We were a small elite group of strategic analysts that reported directly to department heads from Enron energy services to Enron broadband, directly with the management, and evaluated how Enron could apply its asset and trading capabilities to e-business. From there, there was a company called The New Power Co. It was created inside Enron to service electricity and gas to deregulated markets on the consumer side and small business side. It was the largest IPO in 2000. I helped run marketing, specifically digital marketing, inside that division, which was a spinoff of Enron and was a multi-billion dollar company.
“If you look at all the commodities being traded in the world right now, it's all Enron” - Kriegel
Those were really Enron's glory days, weren’t they?
Yeah. I went from being inside Enron having to sell my shares because then I became part of the spinoff and you couldn't hold those shares because of conflict of interest. So I ended up being forced to sell at the top of Enron, and then they took the company public which on paper made me a millionaire. And that was only my second job.
That's incredible. But then it all came crashing down. Did you see the writing on the wall, or was it after you'd already left that it happened?
I actually personally knew Skilling and a lot of the executives since my job was to report to them on opportunities for the company as a whole. I had exposure to a lot of the people who were accused of a lot of things.
There were three stages of Enron. One was the Ken Lay era, which was an asset-heavy era where he merged a pipeline company with an electricity company. Ken Lay was the original CEO and chairman. There was the Skilling era, which was the asset-light company which created the trading that you know now, like Goldman Sachs and all these other financial entities and hedge funds that trade energy related commodities, whether it's gas, electricity, weather derivatives; all those were created inside Enron and by Enron. And then there was a third generation, which was the CFO who joined thereafter.
Ken Lay was a manager of assets, Skilling was really a creator of companies, product innovation, and moved the company to a new era and was very incentivized by equity. Then the third generation, Fastow, who was the CFO, with a group of very smart guys came to manage the financial dynamics of what was happening. These guys were only incentivized by cash. And so a lot of fraud took place. A lot of the manipulation around assets and bridging the gap between how they were financing their books was derived off of the financial manipulations and people's desire to also make money in that process. And people loved working there. I think the Google era, the Facebook era, the McKinsey bowling balls falling off of the building, the wearing the jersey, the water bottles, that's derived off of Enron.
So I think what you see now in terms of commitment to companies, putting your money into your company, your 401(k), showing up at every event, wearing the jersey, believing the management, it was the same there as it is now in these tremendously well respected companies, until they collapse. Unless you were involved directly in the financial aspects of how the company is managed, there is no way for you to know.
“It took about six months for me to go from multimillionaire to completely wiped out in my bank account. For two years I lived on $10 a day, food, housing, everything” - Kriegel
Was it such a big corporation that you were just a small part of it?
Yeah. 20,000 or 30,000 employees, and when you're on the winning ship, whether it was Theranos in the Valley or when you're at Google, when you're at Facebook, the more you win, the less questions people ask. That was true of the financial markets, it related to Enron as well as the accounting firm as well as the law firms. Things like Enron don't happen in a silo.
So there's more to it than just “The Smartest Guys in the Room.” The reality is there was a tremendous amount of talent there and hardworking people, talented people who believed in the vision of Skilling who had no idea how some of the shenanigans were happening in the back. Many of these very talented people end up going to work at Goldman Sachs and working the trading floor, and many unfortunately also were heavily impacted by the downfall.
Enron ended up becoming a byword for failed giant. It's probably something you never expected.
Yeah. I think it's unfortunate from the standpoint of the media, the same way it's treating Facebook, this media is clickbait in a way. They make money on the way up, they make money on the way down.
If you look back historically, you'll see that Enron was the most innovative company in America for five years straight. We're talking about the most innovative company in America five years straight by Fortune or Forbes, the number one or two talent pool behind Goldman or at that time GE Capital.
It wasn't like people weren't paying a lot of attention and people didn't love the story and didn't love Skilling or didn't love what was coming out of Enron. Again, if you look historically at the innovation that came out of Enron, for example, broadband services created really what Netflix is today. They got the deal with Blockbuster to digitally distribute consumer movies on demand. This is in 2000.
Right. This is years before Netflix started its streaming service.
That's correct. This is the pre-Netflix era. So these guys were already innovating and creating things like weather derivatives, if you look at all the insurance products say from weather issues and weather trading, this is all Enron. If you look at all the commodities being traded in the world right now, it's all Enron.
So I had an amazing time there. It was very aggressive, competitive, with very smart people. I always like to say I was the dumbest guy hired there that year because I was the only non-Ivy League guy hired that year at Enron, the only one.
“Both for compensating for my mental health issues as well as a part of how I've come to define myself and my identity around the world, it’s with sports being at the core of my life” - Kriegel
Wow. So once Enron went under, you eventually lost everything. How did you cope?
Once I was asked to vacate the building I was in, which was a fancy place, I started living on $10 a day. It took about six months for me to go from multimillionaire to completely wiped out in my bank account. For two years I lived on $10 a day, food, housing, everything.
But during that process I walked away from my life as it was, from my friends, from my social life, from the clubs, from promoting, from everything and all who knew me. I went working back at retail at, what was it at that time? I don't know, $7.50 an hour minimum wage, I think it was three or four days a week. I was very lucky to have a friend who owned a bunch of retail stores in the optical industry, in Soho and other areas. I had worked for her during a summer in high school. She liked me and she was kind enough to give me a job to go back behind the counter to sell glasses for minimum wage. That allowed me to just get enough money to be able to live and eat.
I bounced around peoples' apartments and Craigslist night rentals and shelters for almost two years. Along the way, I applied for 4,000 jobs, got three job interviews and zero job offers. It was a fairly mentally, emotionally difficult timeline, as well as obviously being extremely poor. I think at that time, sub poverty in New York City was around $14,000 dollars and I was obviously living on significantly less than that. Ultimately, I still had family even though I wouldn't say that we're very close. But my brother had a computer, and he was on instant messenger, and he was playing PC LAN games. He was going to a LAN center out in Astor Place that Samsung used to own. I was curious why he didn't just play video games at home, and he started explaining to me how he played network games and first person shooter games. Counterstrike was already there at that time, in 2002.
I came up with the idea of having a business model around servicing gaming instead of forcing people to buy consoles, and opening venues that would allow for people to come and rent time to play, and the first generation of e-sports.
I was able to do a small angel round and I launched the business. It was called GametimeNation and I was able to directly do a licensed structure. Opened a few venues. And from that environment, Major League Gaming, which was the first e-sports in America and the Western market, was launched.
How long was it from worrying about where to live to not having to worry about that anymore? At what point did you realize, "All right. This business is really taking off and now I can get my own place and I can live comfortably now"?
That didn't happen for many, many years after that. I had that business for almost three years. During those three years, between 2002 to about 2004, 2005, I was not in that position. Even though we ended up selling, it was what I compare to be a small sale on a relative basis. There was no money made in it for myself. During that time I was still living, for the first three years, in sub poverty, and after that on very limited amounts of money. I moved back with my sister, and then started taking care of her cats and her kid as an evening shift for paying for rent in exchange for living with them while I was continually building my startups.
“It's a continuous problem that you're having to engage with [as an entrepreneur], and that you have to find the drive, the motivation, the passion. A sense of commitment that comes from the sense of belief is critical” - Kriegel
How did the idea for ROBN come about?
I am an extreme sports athlete. I have been doing sports since I came to America, and that led me to becoming a national runner, doing bodybuilding, becoming a ski athlete, an endurance hiker, an endurance runner, and doing challenges and events that are considered to be in the one percent of athletes around the world in their difficulty. And I skeleton race on Olympic tracks in Europe.
Both for compensating for my mental health issues as well as a part of how I've come to define myself and my identity around the world, sport is at the core of my life. I’ve worked out six days a week for the past 20 years. But that's essential to how I've come to be successful in my structure every day and how I build my companies, and how I think about building startups, and how I think about team and culture. Sport is really at the heart of all that for me. And ROBN came out of that web.
I was introduced to an engineer who was working on audio communication wearables. That was his R&D manufacturing expertise, and he was working on a wearable where you could speak and also listen without having anything on your head or in your hand.
I took that very early stage prototype, I went on some backcountry hiking in the snow in 2018 in Canada, in bear country, as they call it, and I found interest in the opportunity of hands-free safety around audio communication. Not because I care about listening to music, as much as the empowerment and the opportunity of the safety aspects of not having anything on your head and still being in the environment that you're in. I came back and said, "This is interesting." I did some market analysis. I understood that very few people have options beyond earbuds for having products that you can use while being mobile. It became more of a micro mobility product around if you're cycling, if you're running, if you're skiing, if you're using scooters in the street. What are your options? Headphones? That's not an option. Earbuds? Okay, but not that practical and not very safe for a lot of sports. Very few people are going to wear earbuds when they're skiing.
I cycle around Brooklyn and I never wear earbuds, but I'm always missing out on the music.
Or you can't catch a call or you stop to catch a call. People have their earbuds and they're talking. Most of the accidents that happen on e-scooters are tied to the fact that they're actually using their phone or on a phone call.
So for me, the market was very large — even in the B2B space like construction sites, warehouses. We developed technology that allowed for communication between wearables, that allowed for audio whether in groups or alone, all that while being hands free and headless. That's the premise of ROBN and that was the intent of the company we've built, and I'm in the process of selling it.
How far along has the company gotten in terms of launching and getting the product to the public?
With less than $800,000 in capital in under a year, we released two SKUs after doing over 20 prototypes and 200 use cases in the market. We manufacture in China, we have R&D in Korea, and my marketing and business team are here in the US. We built a mobile software app to be able to support some of the communication of the data tracking and the use cases around the product. We did all that inside a year, which everybody said was impossible to do.
We released those two skews, then we manufactured 5,000 units out of the gate in that same timeframe and we've been selling product for a year now. It's an ultralight product, so people use it to run marathons. It wears like a light vest around your shoulders and it's water resistant, and it's got about six hours, seven hours of battery time. It's simple, but at the same time it's very practical.
“You have to be as committed to the other aspects of what makes you grow and keeps you leveled that you are wanting to achieve the success of your company. If you're not, at some point you will go off the rails, 100% guarantee” - Kriegel
You've been a serial entrepreneur for years. What are the biggest challenges you face?
There’s challenges every day, because it's progressive. Every day as an entrepreneur, your original mindset is that you think you can create something that's solving a problem. Everybody starts a company that is ultimately solving something. The question is whether or not your thesis is right to start out with, and you can only know that when you get something to market and some form of adoption takes place where you'd be able to measure that thesis.
The first phase ultimately is coming to, "Hey, how do I build this?" Whatever that is. "Do I need capital, and do I have the resources?" Whether it's your co-founder which is your biggest challenge number one, all the way through your angel seed round, your challenge number two, your challenge number three, behind that is, "Hey, did we bring this to market within a timeline that made sense and did we achieve that?" Which leads into whether or not you even have something to work off of and build something from, which has got to be more than just a feature.
That's a progressive, natural state that has to happen. But every day, ultimately it's that commitment to wanting to solve that problem despite that every day you're put in a position to fail. It's a progressive state of, one, having a vision that's big enough that people are going to want to join you to be a part of and investors are going to want to invest in because they believe in you as well as the potential of that and the problem being big enough or the market accordingly being big enough.
And two, your ability on a day to day basis to maintain the momentum, the energy, and the emotions, and the positivity, and the mental rationale to constantly be productive. It's actually very hard, believe it or not. It's a continuous problem that you're having to engage with, and that you have to find the drive, the motivation, the passion. A sense of commitment that comes from the sense of belief is critical.
How do you engage with these issues?
A big part of that has been my investment and commitment to health activities, whether they're mental health or physical health. Coaches, mentors, psychiatrists, psychologists, whatever those things are that you need support from, I think people need to just accept the fact that a single individual or a single counterpart, whether it's a wife or whatever, cannot deliver on the multitude aspects and variety that a human being needs to kind of grow through and deal with. The second part is obviously I've been very physically active in maintaining and committing to working out every day, or doing very equally aggressive or engaging activities physically.
I coach and advise some entrepreneurs. Sometimes I'll see them and they're texting me about what's going on, the friction at 7 at night. I tell them, "Listen, you're not going to solve this right now and you're so overwhelmed by it right now that nothing productive is going to come out of it. Go do something for yourself. Invest productively, positively into yourself for a moment so you can realign and rebalance yourself and your mindset. Go to the gym. Go have sex."
That goes back to like you have to realize that organization, planning, consistency around these, "Hey, you know? This one hour a day, I work out. Nobody can bother me during that one hour a day. Or these three hours a week, I see a mental health coach. Nobody can bother me during that time." You have to be as committed to the other aspects of what makes you grow and keeps you leveled that you are wanting to achieve the success of your company. If you're not, at some point you will go off the rails, 100% guarantee. I mean, look, Elon Musk is going on Twitter, and half the time he sounds brilliant, half the time he sounds crazy.
You don't need to be Bill Gates to do what they do or you don't need to be Zuckerberg to do what they do. It's just finding and realizing where you are and whether or not in that context you want to adjust what's important to you, what your priorities are, and where your values go, and where you put your time. It helps if you've been successful, it helps if you've got other important things in your life.
It's not about where you start, it's about how you approach it every day and what your attitude is with what it is you get to work with. If you're relentless about that and you're progressive about it, then it doesn't matter where you started because you will end up way further ahead than either someone who started ahead of you or than you could have even imagined for yourself. It's something that I think, whether it's minority immigrants like myself, people with learning disabilities and mental health issues, the end goal is only as far as you take yourself.