Part 1 - Interview of Helen Pastorino - Founder & Board Member | Pertria, President & Board Member | Startup Sandbox, Founder & Board Member | World Tomato Society

0:01 This is Silicon Valley Tech, Behind The Scenes, a podcast hosted by Shawn Flynn and Sunil S Ranka. Here's where we talk to the real heroes to find out how decisions are made and how they're executed to create the thriving businesses of tomorrow. You know, all about the hardware. And a friend of mine said, you know, you ought to look at these workstations at Next. And I said, OK, what's a workstation? I'm just getting the tower thing down and now we're moving on to workstations. And they said, you know, they're more powerful. The connectivity is different. It's a collaborative piece of hardware. It's not an individual piece of hardware, so I said, OK. And then we called for a meeting with Steve Jobs because he had that time on Next. So I said, great, let's go talk to him and find out what this is and how it works. So I was 31. He had to be 29. And that was Helen Pastorino, who has more than 40 years of experience in transformation. Forming the real estate industry via technology. In fact, at one time, she was Steve Jobs' biggest customer. She co-founded Allen Pinnell Realtors, one of San Francisco's Bay Area's most prestigious real estate companies, driving billions of dollars of annual sales.

1:16 On today's episode, we talk about breaking oneself away from the norms in business. In the early 90s, when Silicon Valley started, what separated her from her competition and much more? So let's get started. So let's start. Let's begin today's episode of the Silicon Valley Tech Podcast. Helen, thank you for taking the time today to be on Silicon Valley Tech with myself, Sean Flynn, and Sunil S. Ranka. We are very excited about this interview. We got to talk to you off camera before and when we found out you have 45 horses, we found out about your family, your history, your neighbor, Steve Wozniak, of all people, one of our heroes and one of the people we look up to. And, you know, we are very excited About this. And I know everyone at home. I know everyone at home is going to love this episode, but before going too in-depth, can you give us a little bit of background up to this point of your career and your time here in Silicon Valley? Well, thank you both for having me. I came to the Valley in 1968, and my parents were looking, actually located a small, obscure little town up the peninsula that they wanted to move to, it was called Palo Alto, and they looked at resale homes in Palo Alto but could not afford them at that time, a resale, average resale home in Palo Alto. So, I came to the Valley in 1968, and my parents were looking, actually located a small, obscure little town up the peninsula that they wanted to move to, it was called Palo Alto, and they looked at resale homes in Palo Alto but could not afford them at that time, a resale, average resale home in Palo Alto. So, I'm going to tell you a little bit about my dad's life. My dad's life in Palo, Palo Alto was $42,000.

2:32 You said $42, 000? $42,00 was a little bit over my father's budget. So, he ended up taking the moving the family to Cupertino, and we bought a brand new home up off above road in the foothills, and paid $31,000 for that. And he borrowed a little bit from his life insurance policy to make sure he could make that down payment on that home. Now, I recall not too long ago, or not too long from then, I have a copy of the San Jose Mercury News. I have a picture of the San José Mercury News. I have a photo of it. I have a video of it. I have a lot of pictures of it. I have a little bit of a picture of it. So, I'm going to tell you a little bit about my dad's life in Palo Alto. So, I came to Palo Alto, and my parents were looking for a resale home in Palo Alto. So, I went to the Valley in Palo, Palo Alto was a little bit over my father's budget. So, he ended up taking the moving the family to Cupertino, and we bought a brand new home up off above road in the foothills, and paid $31,000 for that. And he borrowed a little bit from his life insurance policy to make sure he could make that down payment on that home. Now, I recall not too long ago, or not too long from then, I have a copy of the San Jose Mercury News. And on the front page of the Mercury News, it says, Saratoga housing prices hit $100,000. And the conversation was, how could this be, and who can afford it? And I said, well, I don't know. I don't have the money. I don't even have the money to buy a house. I don't own a house. I don't. I can't afford these houses. So, the decision was, they were celebrities, they were movie stars, or they were athletes. But the average family could not afford a $100,000 home. Employment in the Valley at that time was Moffett Field, was Stanford. Both of them were affected by whether we had a Republican or a Democratic president. So, when you talk about the swings of real estate in the Valley, at that point in time, it was, if we had a president that would support Moffett field.

3:48 Then we were booming with VA loans all over the Valley. And if not, then we were in a recession until the next election. So, agriculture, as everybody knows and reads about, was prevalent in the Valley. And some of the key locations were Olsen's Cherries in Sunnyvale, and the Del Monte Insignia in Campbell, downtown San Jose. Calley Brothers, of course, in Cupertino. And I think all of the kids, at some point or another, were in the Valley at that time. And I know I worked there. And for 50 cents a tray, we were asked to cut the apricots in half, splay them on the tray. And then those trays went as far as you could see. And the trays were 8 feet by 4 feet. And you were paid 50 cents a try. So, can you imagine how long it took for you to cut? Well, of course, you ate one and you cut five. And you ate one, and you cut 5. And you cut 5. But there was no 85. So, 85 was on the maps. It's been on the maps for a long, long time. 35 years it actually appeared on the maps, but there were houses completely all the way through 85. And then there was a decision made that, okay, that was that 85 was, in fact, going to be...

5:05 Built. Built, yeah. Wow. And it was going to be five to six years. So, we had to start talking about moving houses out of the corridors. We had to start taking about... The exit ramps. So, at that point in time in my career, I worked at a company called Fox and Karskad. And I managed their Saratoga office. And we had a meeting, De Anza College, at the Flint Center. And it holds about 2,300, 2,500 people. We had five mayors. We had Caltrans. We had a couple of managers, a few lawyers. And basically talked about where the off ramps for 85 were going to incur and in what cities and where. Los Gatos was adamant they would not have any sort of 85 off ramp. They were the most difficult of all the towns with regards to accepting an off ramp. What they didn't were people to be able to come from different areas and just land in their town. So, they did not want one. So, the rule became that every town had to have one. At a minimum, you were going to have to identify within your town or city where you were going to have an 85 off ramp, so we're driving through the valley now. I drove here today and I had a smile on my face when I jumped on 85 in Los Gatos. Because you can only go one way.

6:20 The 85 off ramp in Los Gato is only north. So, I jumped on and I laughed. I thought, yeah, I remember this. I remember the argument about this on ramp. So, I've had an opportunity to see a lot of things take place in this valley. And those are just some examples. And then your career path. Currently and in the past 20, 30 years, what sector has it been in? And can you talk about that? Can you talk about the development of that? Yes. So, I started in real estate in 1975. I was 21 years of age. And at that time, I was a sole practitioner. I was an individual real estate broker and sold real estate in the valley. And the valley was full at that time of very small offices. Independently owned. Five to 15, 25 people at most in those offices. Most of them were gentlemen. Most of them are male. Probably in their 50s. Retired or second careers. Very unusual to see a young woman in the industry. And rarely saw any woman who was the broker of record or actually owned a company. So, I learned my mentors were mostly men, middle-aged, retired or second careers, and they taught me very well. So, I went on in 1998.

7:35 I was 27 years old. And I began to manage the Fox and Karskaden office in Saratoga. On Prospect and Highway 9. Fox and Karskaden was a very well-known real estate company. It was founded in the peninsula in 1929. One of the top three in the valley. And Saratoga office, you know, when you were in the peninsula, in those days, and I'm not so sure it hasn't changed. The South Bay was kind of a stepsister or a stepbrother. It was unfortunate that you had to identify yourself as a South Bay real estate firm. And the peninsula firms, you know, did their best to accommodate us. But we were really South Bay. So, Fox and Karskaden was a peninsula firm. As was Grub & Ellis. As was Cornish & Carey. And those were the big three firms in the valley. And we took on, I took over Saratoga. And we became one of their top first, second or third offices. So, now they could no longer dismiss the South Bay. Because one of their offices were there. In 84. In 84. I think I was 30 years old then. And now you can figure out how old I am now. Were you calculating? I saw you, Sean. Luckily, none of us are engineers.

8:51 We're not good at math. Exactly. So, we're all good here. Well, I took over. I became their senior vice president. I stayed managing Saratoga. Which was considered a very large office at that time. It was 50 people. I took over, I oversaw Palo Alto to Carmel. So, I had seven other offices. So, I had seven other offices that I was responsible for. In addition to the office I managed. At 1989, my boss, who was the general manager at Fox and Karskaden, applied for the position of president of Fox and Karkskaden. He was denied that. And shared that with me. And shared who the president would become. And I resigned. So, I left Fox and Kaskaden when I was maybe 34. With my boss, Alon Pannell. And we didn't quite know what we were going to do. We thought maybe we'd go to work for one of the other remaining large firms. But we decided instead that we would open our own firm. So, in June of 1990, we opened Alon Panell Realtors. It was myself, Alon, and Paul Hume. Paul Hume was a client of mine. I reached out to Paul. He was not in real estate at all. And he said, sure, I'd love to do that. And he said sure, I would love to do. So, the three of us opened the company in June of 1990.

10:08 In June of 1990, we were in the middle or just at the beginning of a five-year recession. Phrase on the street was survive till 95. That was, we were all hoping that we would make it through this five-year downturn. So, here we are starting doing a startup in June of 90. Being told that we were heading for a major recession. I had signed on to follow. I was going to be a follower in this organization. And do what Alon told me to do. Because he was a superstar. He was just amazing. His marketing skills were just ridiculously impressive. Well, what happened was we had to make a decision. We were a small firm of 17 people. We had leased a 7800 square foot office. So, a large office was 50 people. 7800 square feet is 150 to 200 people. That's what it will accommodate. So, one of our decisions was, to go from small to large. There were no large firms in the valley. Second of all was how to survive this downturn. We had 17 people. You can imagine how that felt to have 17 people and 7800. It was a ghost. It was in a bowling alley. It was, there was nobody there. So, we had to figure out how to compete with these big companies with 17 people.

11:26 And everybody was saying, you won't make it. You'll never survive. We're heading for a recession. Bad timing. So, we came up with a decision. What are we going to do? We looked at the standards of practices in all three of the other firms. We had worked in them. So, we knew what standards of practice were. How are we going beat those standards? And so, you can market a little more. Spend a little more money. And at that point, all the advertising, because there wasn't technology in the public domain of any extent. Buy more advertising. Buy more marketing. Buy more magazines. Business journals. Business journals. San Jose Mercury News. Luxury magazines. Holmes and Lance. We'll just buy more pages. Well, we couldn't buy more pages, we were competing against 1500 brokers or agents in other firms with 17. So, the decision came down to, which I didn't know at the time, technology or magazines. None of us knew anything about technology. We couldn't even, I mean, we didn't have the language. Like, we didn t even know how to talk about it. We only knew the word technology. And there were computers. This is a perfect segue for the next question. So, being in Silicon Valley, you have seen so many changes from food arcade into turning into a 85.

12:44 You know, moving the houses, Las Guerras not letting you build a ramp. What was that inflection point where you started seeing technology as a prevalent market share within Silicon Valley? Well, you know, those things when you look back, you can always identify that point. But when you live through it, you're never really sure where that point was. For us at Alompanel, it was a very distinctive point because there were three of us co-founders. And we had to make a decision where we were going to invest our money to ensure this firm survived this recession. And even if it survived, could compete against these companies that have been in the market since 1929, major players, we had to decide. And it was almost like scissors, rock. What is that game? Rock, scissors, paper? You wonder how decisions are made? Oh, my God. I can see my kids doing that rock, paper, scissors. Yeah. Are we going to buy more magazines? Are we going buy this technology stuff? Rocks, scissors, or paper? So, Alon's concern was that this was a passing fad. That these would end up being as he called them. Paperweights at some point in time.

13:59 And that the real core of all success for real estate firms or firms in general was marketing, press release. Very difficult to argue with because it was a proven practice. To argue technology because nobody had a clue. But the vote came in. And then when it was paper, scissors, rock, two of us decided technology. And Alon decided magazines, newspapers, and marketing. He resigned. And in December of 1929, Alon decided to quit. He resigned. And in 1996, months after we were founded, he returned to Paris and left. He did not believe, or at least according to what I believe he stated, he did not believe the technology would allow us to survive. So, what made you think that technology is the right way to go about your business? It was different. It was bleeding edge. Not leading edge. It hurt. It really hurt. It was bleeding-edge. It was just at the forefront. It was at the forefront where people were starting to talk about it. It was something like a wave that was coming. But it was a risk because waves come and they fail. But I thought, I thought there was a high probability when you had companies like HP, Apollo, Sun, IBM. There were enough companies around that I thought it was going to stay.

15:19 Now, could you tell me when you're saying technology, what exactly do you mean? I don't know. Because that definition can be so broad. Technology, was it at that time? Actually at the time, at the time it was hardware. Everybody talked about hardware. Hardware and towers and computers, you know, hardware. And almost all of it was in academics or in government. There was very little of it in the public domain. So, and if it was in the public, it was a single person had it. So, you had one and you used it. But there was no connectivity, not a tremendous amount of connectivity. So, the thing what we call today internet was not existing back in the days? I have a few little dates here that was kind of surprising that ran along the same timeline as Alain Penel. In 1990, the first web browser was announced. I remember we incorporated in June of 1990. Wow. So, we're talking bleeding edge, not leading edge, not on the edge. But we really, and then the next thing I think in 91 was Linux. And then 92, the first text message went out. In 94, Amazon was founded.

16:34 PlayStation was created. And banner ads began to happen. In 95, of course, Windows 95, Java, SSL. 96, the first Palm Pilot, first handheld. Remember that? The first, so the Palm Pilot was in 96. Now remember, we incorporated in 99. 97, Steve Jobs returned to Apple after the Scully debacle. And in 1998, Google was founded. So, the Valley right now thinks it's really hopping. In those eight years, and that's just a few, in eight years during a major recession, those are some of the things that happened. And then all this technology, your company was starting to utilize? What are the agents? Did they have their Palm Pilots? Did they have, was there a website? A website, hand-coded HTML, no WordPress, and that for, I'm really curious about everyone, all the other real estate agencies just looking at you going, they're doing what? Actually, we had more of a problem. The outside real estate companies thought this was a ploy, a joke, you know, a short-term, you know trying to get our name out there type thing. And we had more trouble inside our company than we had outside.

17:49 The agents inside just didn't, it was just, they didn't know. They just, they didn't understand how this was going to help them sell real estate. And nor did we. So, it was very hard to explain to them because we didn't know how this was gonna help them sell our real estate. And what we ended up doing, we ended up, we ended buying a number of towers. I think they were from HP. We went to Sun, we went to Apollo, we learned about proprietary software versus open. Here we are real estate agents, right? Learning all this about, and we bought the towers because it was all about the towers. You know, all about the hardware. And a friend of mine said, you know, you ought to look at these workstations at Next. And I said, okay, what's a workstation? I'm just getting the tower thing down and now we're moving on to workstations. And they said, you, know, they're more powerful. The connectivity is different. It's a collaborative piece of hardware. It's not an individual piece of hardware, so I said, OK. And then we called for a meeting with Steve Jobs because he at that time owned Next. So I said, great, let's go talk to him and find out what this is and how it works. So I was 31. He had to be 29. Just for the listeners, you're talking about the Steve Jobs from the Apple, right? Yes. And I had had a lot of success at a relatively young age in my career.

19:05 So when you're 30 years old and you've had a lot success, you have attitude. But he was 29 and he had more success and he had attitude. It took us a long time to get past his gatekeepers. Because we were laypeople. We were out in the public. He was not selling to laypeople. He was selling to academia and he was selling to governments. He was selling not to the average user. So it was really hard to get through the system to get to him. And it was persistence and tenacity and maybe being a little bit inappropriate. But we got through and we got a meeting. And all of us got dressed up like in our Sunday bests and brought our briefcases and did our job. We got our briefcases and did our hair and put on our makeup, wore our three-piece suit. I mean, we were like going up to... And we went there in this huge conference room. It was so big. And waited and waited and waited. And we were 45 minutes into our meeting time, no Steve Jobs. His staff was at the table with us. And I was asking, how long do we have to wait? Are we too early? Did I get this wrong? Where is he? That type of thing. He'll be here. He'll be her. So 45 minutes. I said, okay, that's it. I'm done.

20:21 Everybody, we're leaving. So everybody stands up. I stand up and we start to go out. I said, just a few minutes. I said, no, I'm done, I'm out. And the door opens and there's Steve. He had on Levi's. And back then, that hadn't become protocol. You were supposed to dress up to go to big important meetings. Came in and the minute he opened the door and the table was probably... It was quite a distance from the front door. The charisma was absolutely... I could not believe that a man could walk in a door and produce that kind of charisma from that distance. So I thought, I am in trouble here. I'm in trouble. I've got to lose the charisma immediately. Just chop it down to nothing. There is no charisma, but it was very apparent there was. So he came to the front of the conference room table, as you can imagine. And the first nine chairs on both sides were empty. We started at the 10th chair with his team across the table at the 10ths chair. I looked at that and I thought, okay, so this is how this is going to go. How was it like interacting with Steve Jobs? Because you talked about attitude, success. He's not willing to sell to an outsider. How was, what interaction went?

21:37 You know, part of me went to, I had to quickly analyze how this was going to unfold, what role I was going to play, what role he was going to play and what the outcome was. In a meeting like that, you have to decide where your walk point is. At what point am I going to walk? And at what point will I trigger him to walk? So you start out, not that you would ever know, but you have to analyze and draw it somehow. Otherwise you lose total control. And next thing you start agreeing to things that never in your life would you have agreed to. If you, I think he came to the meeting fully prepared to tell us we were inappropriate and it wasn't going to happen. But there was some little. Yeah. Part of him that was curious and he loved that next box. I mean, it was just an amazing piece of technology that there was a little part of him that thought, but what if? And I think that's the part of Steve Jobs that made him who he was. Probability not going to happen. But what if? And we were a what if? So we started talking. He said, what are you going to do with it? I don't know. Why would I sell it to you? I don't. Know you're a real estate company. Yes, we are. Do you know anything about technology? No, we don't. Yeah, I'm not selling it. That was kind of it. And I said, OK, but everybody has to learn. Your Apple computers are in schools now.

22:54 That's telling me that your horizon of time says that you are preparing these for the public market. You want to sell these things to the public market, so give us a chance. We're here and we'll be a successful introduction to that market for you. And he said, we're going to talk. Team's going to talk and we'll let you know. And weeks went by. And I called and I wrote. And I can't email, right? You can't. I called and I wrote. I went up and I waited in the lobby and they told him I was in the lobby. And he didn't come out. And I got a phone call. And his calls typically come like this. Hi, it's Steve. Steve, who? I know a lot of. And I'm thinking, why wouldn't you tell me who your last name was so I could at least, you know, figure out. But I learned over the years, that's how he placed his calls. Hi, I'm Steve. Or it's Steve? So we called and he said, listen, I'm going to call you. And I said, OK. I'm going. Are you ready to pay the price? And I said, well, I don't know. What is the price? And he said, these these boxes are $5,000 a box. You could buy technology for $1,100, $1,200, $1.5, $1 1,800 from proven HP, IBM, long-term, and even the most advanced technology. And I said to him, well, you know, I don' t know what the price is. And he said to me, well, it's $5,500. And I said well, I'm going to call you. And he said I'm going. And I said I'm not going to pay you. And he said well, you're not going to buy me. And I said no, I'm not. And he said no, you're going to pay me. And I said, well, I don't know what the price is. And he said, these these boxes are $5,000 a box. You could buy technology for $1,100, $1,200, $1.5, $1 1,800 from proven HP, IBM, long-term, going to stay around predictable companies. And this was a risk. So and it was a monetary risk.

24:12 That's a huge amount of money. But here's what I learned from him. Once we decided it was a go. He completely changed his mind. He completely changed his posture. Now we were on the team. Now we were going to do this together. Now he was going to do everything he could to make this a successful exchange and a successful purchase and engagement. And he started to teach us about object-oriented software. Now mind you, I'm a real estate broker back then and he says, listen, this is what it's all about. The box is necessary to run the software, but what you want to look at and what you want to buy is software. How long is it going to take to write the software? The customer wants that software. He wants that software to provide you the suite, the custom suites that you want, and what's it going to cost? Well, we know that because when we went to HP, it was hundreds of thousands of dollars and years for them to write custom suite that we wanted. He said $70,000, 90 days. I mean, how can those be that extreme? And then he explained why. He taught us about linear programming, how you program linearly. And if you want to make a change. what that programmer has to do to make that change and oriented software. It allowed you to build objects that you put in a library that you can pull down and modify as you wanted to change. So instantly, I thought, well, that makes perfect sense. If you want to write software, why wouldn't you want to ride it on that kind of a platform rather than a linear, binary, linear, I guess. So I was in. He took us up to Oakland to some programmers did this. Amazing men, just amazing. And they wrote our software for us in, I think it was a little over 90 days. They wrote seven custom suites and I think it was $82,000. So that's my experience with technology. So once this technology was implemented throughout your company, can you tell us about the growth of this real estate, your company?

26:06 Was it just, okay, we expanded, you know, 10% every year or? Was it hockey stick growth once the technology was implemented and customized for your company? That introduction of that technology almost brought the company to its knees. I had an opportunity to observe human beings and how they learn. So this was something, it wasn't like, okay, we're riding a bike and now we're going to ride a motorcycle. The bike and the motorcycle have very common features. This was, I don't know anything about this. The closest we could get was a typewriter. That was about the closest. We could get. And a lot of them felt it was kind of a useless typewriter because at that time we had IBM Selectrics on every desk and that put the paper in, roll it up, type and put the little white and it backspace. And that's how you did it. The other problem was we didn't have anyone to send this stuff to. There was nobody out there. We could remember the first fax machines and you wondered who am I going to fax to? And you faxed to somebody who had one and then you ran down to see how it came out the other end. It was the same thing with this technology. There was nowhere to take it, nowhere to send it. Professors at Stanford would get it, government officials and some, but you couldn't send it to another real estate office. We had lots of problems. We had problems with the email addresses. The realtors came back and said, our client, we're not selling real estate because we're ending up in a technology conversation with our clients. And at that time, the majority of them were in fact engineers in the Valley because you had IBM and you had, you know, the major tech, that kind of technology.

27:40 And they, they couldn't explain the reason for the email address. People thought it was a typo. People thought it was gimmick. People didn't understand what you did with it. And they said, we're spending 30 minutes of our listing or selling time trying to explain this thing on our card. We want it off. So we dealt with all kinds of, we do not want this on our cards. It's getting in the way of our business. So then as a CEO, you say, okay, we'll take it off. But the CEO, said, no, we're not taking it off. We're going to learn to explain it. And soon our clients will understand what it is we're explaining to them. So we lost some people, not many, but some. And we set up classes. There were eight classes a day. Everybody had to take, at least we had 20 classes. So we became a mini university, teaching people how to email, how to download, how to, anything to do with technology. At that point, a lot of them had paper and they weren't sure how they were going to get, how you got the paper in this thing. And they'd go back over to their typewriters and type. So I gave an ultimatum and I said, at every class they went through, we gave t-shirt or we gave a pen or we gave graduation type. We had to encourage them to get to these courses. And there were early adapters, which I learned about. There are those people who step up right away and want to learn. And I said, okay, I'm going to take this course. And they learned everything there is about it. And they led the way for everyone else.

29:16 At the tail end, I gave an ultimatum. By this date, at this time, we will be removing your typewriters. So you better learn how to use this because there will be no typewriters typewriters went under the desks. They went into the ladies room. They went into the cars. I mean, these guys were going to hold onto those typewriters no matter what. And I had to find them in the ladies room, in the ladies, stall, you know, in the supply room under the desk. And I had people go and find them all and we gave them away. And so I learned a lot about technology. I learned, and I think the most important thing I learned, which applies to all anything new is the learning curve of biology. How, how do you teach people a new practice that they've never seen before? And how long does it take them to absorb that, to couple with that new learning? And how many of them have the emotional strength, which we talked about, to learn? So as a real estate agent who just wanted to sell houses, I was involved in things like classes, teachers that had to teach the classes, which was language they'd never spoken. I know a little bit about technology.

30:35 Thank you for listening to Silicon Valley Tech Behind the Scenes. To find out more, contact the team, or to be a guest on the show, visit our website at siliconvalleytech.com. We look forward to hearing from you. And remember to support the show by leaving a review to encourage us to keep creating great content like this.