Editor’s note: You likely have heard and perhaps watched “The Five” on Fox News. Scott Moody, founder and CEO of Raleigh startup K4Connect, has his own version of the five – a quintet of people who inspired him to come out of retirement after selling Authentec security technology to Apple. He recounts his trek back to startups at the Cucalorus Connect conference in Wilmington. Jim Roberts reports the story.
WILMINGTON – To say Scott Moody is one of a kind is a drastic understatement.
If you know Scott, you know the story of Authentec, the ONLY company Apple has EVER acquired after the company has already had an IPO. EVER. While Apple iPhone X has moved on to facial recognition instead of the fingerprint security, Scott is convinced that the TouchID technology still has life.
On Friday, Scott gave a speech at the annual Cucalorus Connect in Wilmington about how connecting with five people in his life brought him out of retirement after Authentec and back into the world of startups in North Carolina.
When a woman you barely know, and yet she seems to know everyone else
Scott began his story by telling of his humble personal story of his parents and family. He was driven for success by these humble beginnings and striving for more. He tells the story of graduating from NC State, getting married and moving to Florida within the same week. He moved to Melbourne Florida to work for Harris Semiconductor. He moved up the ranks very quickly with that drive to be successful
He found himself in a leadership position in new spinout to take some Harris technology to develop fingerprint security for mobile devices. And he was on top of the world as part of a Joint Staff committee with an important federal military organization.
He got a call from his family that his wife’s grandmother from rural southwestern Virginia had passed away and the funeral had been arranged. Scott left an important meeting to be counted among what he thought would be a small funeral for a low profile relative in a small rural town.
What Scott saw at this funeral changed point of view. The high number of people who attended this funeral in this small rural town made Scott realize how much bigger the world really is and that life was bigger than him alone. The impact this woman must have had on this community for this high number of people to show up in mass really struck Scott and his perspective changed.
K4 is a family name and here is why
We are all too familiar with the stories of struggles at startups. Scott made his story very personal during this keynote speech. At the start of Authentec after spinning out and leaving the security and safety of the paycheck at Harris Semiconductor, there were 50 other startups working on fingerprint security for mobile devices.
Scott and his team of more than 25engineers worked for two years on the prototype for TouchID product. After spending 3.5 million dollars, the first attempt of the prototype from the manufacturer did not work.Scott took his team out for dinner and drinks to drown their sorrows and in a quick poll, 20 of the 25 employees did not think the company and product were going to make it and succeed to pay off the hard work.
Scott tucked his tail between his legs and went home to “whine” to his wife Katherine, the same woman who married Scott in a whirlwind of graduating college and moving to Florida. Scott had to face the facts and apologize for leaving that comfortable paycheck from Harris Semiconductor.
After all of the emotions, Katherine told Scott: “ You know what you have to do. Just go do it.”
Scott knew that Katherine could have gone negative but instead showed the love and support to build Scott back up so he could lead his team. And of course, the next prototype worked and the rest is history. This could be why the new company is called K4 Connect after the 4 women in his life with the name that starts with K, Katherine and three daughters.
Scott told a very personal story about his father Fred Moody. Let’s backtrack with the story first that after the prototype worked and the chip is being developed. Scott and his team are in Redmond, Washington with the leaders at Microsoft for a potential licensing deal. The pre-dinner networking is going well but Scott gets a call from his daughter Kelsey who is away in Alabama at a soccer camp. She sounds concerned as she did not bring some of the necessities of the soccer camp like the other players.
Scott flashed back to when he was a young kid and working with his dad to develop the old pinewood box car races that many kids have in Boy Scouts and similar organizations. Now his dad was a hard working man scrambling to support a family. Scott told the very personal story about being at the Pinebox car races and competing and winning but always looking at the door of the building to find the support of his father. Round after round but no sight until the quarterfinals when his father walked into the building. Scott says with a sly smug smile that he won that competition.
With that experience of longing for the companionship of his father, he talked to and comforted his daughter and left the Microsoft meeting before it started. He flew from Washington to an airport near the soccer camp in Alabama to provide the needs of his daughter who was away from home. Much like Scott’s dad was there at the Pinebox car races.
Guidance of faith
After the acquisition in 2012, the Moody family moved back to Raleigh while most of the Authentec team continued to work for Apple. Scott was burned out from burning the candle at both ends from the beginning of a startup to becoming a CEO of a publicly traded company in 2007 and the process of selling to Apple in 2012. He swore to everyone that he would never be part of another startup.
Scott took a trip to Rwanda as part of a microfinancing conference. While there, he met a young woman named Jennifer who had opened 15 orphanages. Jennifer sold cakes to fund the orphanages. And then she started a coffee shop and bakery for additional finances to support the orphanages.And she began to train other women in surrounding villages.
This story inspired Scott and the burnout began to lift and he got the itch to start something again. After returning to Raleigh, he began to network within the startup ecosystem and started mentoring young entrepreneurs. One of the people Scott had been mentoring back in Raleigh was a young man named Jonathan who was part of a company that Scott felt might not succeed. But he believed in the young man more than the company. But Scott kept investing his time in the young man.
The company eventually failed but Jonathan had a new idea for a new company. And since Scott felt he knew Jonathan, he agreed to be a cofounder and investor. The idea within the Internet of Things space was to integrate products and software into a single platform. The other current technology products on the market were either too hard to use or too expensive. The new team developed the IOT products without a vertical end market in mind but Scott knew he wanted to go big with this idea and was willing to invest and risk what he had earned.
What to do with 1,000 steps of life per day
While Scott is a deeply religious man, he is willing to take many meetings to help others with ideas. He soon met a man named Eric who was an advocate for the homeless and was introduced by a mutual friend of the two men.
The two men had a long talk about helping the homeless, Eric asked Scott about K4 Connect. Scott simply explained the use case for IOT in the home of turning on lights and other uses. After this brief explanation of IOT, Eric told Scott about his own experience with Multiple Sclerosis and how this IOT technology could help him.
Eric explained that he knew he only had the energy for 1,000 good steps per day. If this IOT technology could help him be more efficient and productive with these 1,000 steps per day, it could also help other disabled and older people within the population. This was the inspiration to pursue this huge potential market of 1.5 billion people for K4 Connect.
About the author
Jim Roberts is the founder of the Network for Entrepreneurs in Wilmington (NEWilm.com), the Manager of the Wilmington Angels for Local Entrepreneurs (WALE) and Community Development Manager for Bunker Labs RDU. Jim has been a regular contributor to WRALTechWire and others for the last 17 years while working in entrepreneur development in North Carolina. He can be found on twitter at @RedSpireUSNC