When Death Comes: The Extraordinary Tale Of Two Berkeley Entrepreneurs

TWO CO-FOUNDERS MOVE FORWARD, ANOTHER DROPS OUT 

Lee and Parikh decided to move forward. Pour-Moezzi ultimately chose to take a job with Microsoft when he got his MBA. Shenoy, already in India, left the business when it became harder to remain a partner remotely from another country.

The close bond Lee and Parikh formed during those summer months revealed major personality differences between the two and a good number of constructive disagreements. “He was more fearless in the sense that he was willing to put himself out there. He wanted to go and meet as many people as he could and tell the world what we were working on. I was a little more reserved and practical. I was okay with telling customers about it, but when it came to investors I said, ‘Let’s not really bother with them. Let’s really nail it.’ But he had this confidence that was amazing. He was charismatic and he had this vision of where we could take the company. I was just more practical.”

“When I couldn’t think of a way to execute on something, I would sometimes assume it just

wasn’t possible. For Hansoo, nothing was impossible. He was that driving force. He would say, ‘We could do this. And my job was to ask okay how do we get there? He stretched me, and then I actually helped us move the ball forward. So it was a great relationship.”

LEE WANTED TO RAISE MORE INVESTMENT, PARIKH PREFERRED TO BOOTSTRAP

The biggest dispute occurred shortly after they graduated and were working full time on the business in the fall of 2010. Up until then, they had scrounged together about $70,000 for their business, having won $10,000 in an Intel-UC-Berkeley contest and $50,000 from Northbridge Venture Partners. But now Lee felt strongly that they needed to raise significantly more money from investors to grow the company. Parikh preferred to bootstrap their business. The disagreement was so profound that at one point Parikh suggested that he would be willing to leave the business altogether.

“Those were tough discussions,” recalls Parikh. “He felt that if we raised funding we would be able to really make a difference: to grow Magoosh much bigger, to reach more people, to serve test prep to a lot of people who don’t have access to it today. The potential was so much greater. He always saw the potential and he always had that vision. For me, it was more of the practical side. If we raise funding, we’re going to have to grow big, and at the time, I thought we would have to give up some equity and control. All of these things I was worried about, not to mention that in my ideal world we would be a small company with six people working together and it would be a lot of fun. Hansoo just said that might be fun for a little while but he said, ‘Don’t sell yourself short. We can really turn this into something. I’m confident about it and I’m confident you’ll enjoy working with more than six people.’”

BY APRIL 2011 THEY RAISED HALF A MILLION DOLLARS

It was during a lengthy three-hour walk around the Berkeley campus that Lee tried to convince his friend to go along with a plan to raise $750,000. “At one point, I said, ‘You know if you really believe in this, maybe I shouldn’t continue on in the company because maybe this is not what I want. It’s what you want.’ That was not an option for him. He said, ‘No we are doing this together, and I’m going to convince you.’ And he did.”

By April of 2011, Lee was able to raise half a million dollars. They used the money to build the team, market the product, pay each other modest salaries, and get a real office. The GMAT prep product began to take off, and then they began focusing on the GRE, which was about to change in August of 2011. Magoosh got its new GRE product out the door a month before the launch of the new test. In November, Lee was on Fox Business to promote Magoosh’s new SAT prep service. He looked his usual charismatic and promotional self, talking up the benefits of offering test prep for free to high school students who otherwise might not be able to access those services.

Little more than a month later, Parikh would get the email from his friend while in a car on his way to dinner with his wife’s family. “I saw it and I didn’t say anything,” he remembers. “As we were getting out of the car, I told my wife.”

There would be a flurry of emails over the next few days, including Lee’s belief that his prognosis was pretty good. When the diagnosis was made on December 21, no one knew how lethal the disease would become. Two days before Christmas, Lee checked into UCSF Medical Center for a lymph node biopsy. The genetic testing led to the discovery in early January that his cancer could be treated by the use of a drug called Tarceva, a more targeted and less toxic treatment.

PARIKH SLOWLY ASSUMES MORE OF LEE’S DUTIES AS CEO 

Still, when Parikh returned from the East Coast, Lee didn’t show up at Magoosh’s office. Instead, Parikh would slowly assume more and more of Lee’s duties as chief executive officer. Every week, he would walk to Lee’s nearby apartment, and the two would stroll through Berkeley and the university campus. The company hadn’t yet hit its stride. It was making some money, but not enough to pay everyone’s salary. So there was much to discuss. “We had thought about raising a true Series A round in the millions, but with him being out that would have been exceptionally hard because he was the face of Magoosh. He was out there. I had relationships with investors, but not to the degree he did. But those walks energized him because instead of thinking about him and his prognosis, he began to think about Magoosh and the progress of the company.”

Then, on February 19, good news came in. The results of his first scan–after using the drug Tarceva for over a month and undergoing two weeks of targeted radiation–were encouraging. It showed significant shrinkage of the tumor in his lung.

Less than a month later, on March 10th, however, Lee was rushed to the emergency room when his left lung stopped working. He had to have an emergency broncosopy to restore breathing into his left lung. “As things got worse for him, we started doing monthly phone calls, and then he moved to San Francisco to be closer to the hospital,” remembers Parikh.