Disruption as a Philosophy: Brian Dally of Groundfloor

Published Mar 27, 2018

Long before Brian Dally held the title of CEO of his own company, he thought of himself as CEO of the products he managed inside other people’s companies.

That meant assuming P&L responsibility, even when it wasn’t assigned to him; coordinating with relevant staff, even when they didn’t report to him; and most importantly, casting the product vision and executing on it.

Dally is using many lessons he learned as a product manager in the wireless phone industry today as CEO and co-founder of real estate crowdlending startup Groundfloor. The Atlanta company in January received unprecedented qualification from the Securities and Exchange Commission to allow any person in any state to invest in real estate loans on its platform.

Disruption is Dally’s product philosophy. Product management is not about making day-to-day product decisions as much as thinking strategically about creating transformational experiences for customers.

“Don’t go solve a hard problem just to do it,” he theorizes. “But solve one that actually matters to customers.”

Dally got his start in product management as a summer intern at Microsoft in the late 90s. An early a-ha came when his role as a product planner meant thinking about competition and how his product would fit into the world and create value. After earning a JD and MBA at Harvard, he spent the next 13 years applying that strategic thinking to communications products, from Excite Mail in the late 1990s to mobile phone casino games in the late 2000s to’s Republic Wireless at its conception in 2010.

There, Dally got to apply his product philosophy from inception to execution. Three key lessons during that time have helped guide him as a startup founder:

Solve an important problem for the right customer

Dally was originally hired by Bandwidth to sell wireless services to SMB customers. It didn’t take long to feel the hot competition in that space and realize the magnitude of resources that would be required to compete.

Taking a step back to consider the customer experience with mobile phone service, to talk to phone users and hear their challenges with existing WiFi-based services made Dally see the opportunity to build a product that disrupts the consumer market.

In the early years of Republic, he invested heavily in a process of listening and responding to customers. But Dally’s advice is to set customer care as a priority regardless of the company’s size.

“Find a way to sit next to people,” he says. And make sure you’re always building for the right customer.

Do everything possible to control your own roadmap

A recognition in the early days of Republic Wireless was the difficulty of building a successful product if you can’t control your own roadmap. Using another wireless company’s network would have made Republic dependent on the quality and sustainability of its services.

In Bandwidth’s case, taking control of the roadmap meant owning the network rather than creating another app that enabled VOIP calling and texting atop other networks. It also meant delivering on customers’ desire for as seamless a calling or texting experience as possible—one phone number, one account to manage and dialing and texting native on the phone.

By embedding ourselves in the wireless network and the phone as well, we created awesome customer value,” Dally says. “We could give you the economic benefit of VOIP, and the convenience of being able to call on the cellular network.”

Republic Wireless was all about a simple and seamless calling experience. Controlling both ends of the customer experience allowed the team to build it.

Add something special. What makes your product radical?

What made Republic Wireless radically different from competitors was the price. At just a tenth of the cost of a typical mobile phone service, and with 80 percent of the performance, Republic offered unmatched value in the market.

Dally’s thesis here is to take “a contrarian understanding” of whatever industry you’re trying to disrupt. For Republic Wireless, it was both technology and the incumbents’ strategy.

Groundfloor hacked securities law to enable a new kind of investment opportunity for consumers. Radically different in this case is a positioning as the only one of dozens of real estate investment startups that chooses to qualify its offering under rigorous securities regulations. That might sound counterintuitive: more regulation often means more rules and less flexibility. But to enable a whole new class of investor to take part in its offering, Groundfloor had to work within the confines of the law.

Groundfloor discloses everything about its product in gory detail and reports its product performance on a monthly basis. That’s a strong incentive for Dally and his team never to cut corners and to provide the best possible results for customers. The regulatory qualification and compliance process, though intensive, actually made the product radically better.

“The rules require us to do it, so it’s part of our product experience and value,” he says. “The regulatory construct forced us to do things for customers we may not have taken time to do on our own.”