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The "No BS" version of how startups are really built, taught by actual startup Founders who have lived through all of it. Hosts Wil Schroter and Ryan Rutan talk candidly about the intense struggles Founders face both personally and professionally as they try to turn their idea into something that will change the world.
Welcome back to another episode
of the Startup Therapy Podcast.
This is Ryan Rutan
joint, as always by my
friend, the founder,
and CEO of startups.com.
Will, Schroeder will, it's
no secret I don't think to
anybody listen to the podcast
that you've, you've said
many times that, you know,
entrepreneurship was what kind
of yanked you out of being a,
a kid with nothing to founder
with full control over their
destiny to the extent that
we have full control over our
destinies as founders or anyone.
But here's the question,
man, like I, I want
you to back into that.
I want you to talk about
how that worked for you
and, and I think today
we wanna talk about like.
Can that same ladder be climbed
by millions of other people?
Who, who, who start where
you did or start anywhere
on a relative scale?
And can it be used to, to
alleviate or eliminate poverty?
It's, it's interesting.
I don't think it, it can be
used universally, like pull
everybody out of poverty.
Sure.
I think what it can do, and I
know, I know you feel the same.
I feel like what
entrepreneurship can do is
it can create a flywheel that
starts things going right.
It's, you know, if we look
at, it's how America was
built on that flywheel.
You know, where these
industrialists, you know,
started to build what
became Modern Day America
by planting those seeds.
And in most cases,
they came from nothing.
And they were able to use
what became the American
dream in order to build
this next generation
of wealth and success.
And I think about this a lot.
This was my story.
I was the kid that, that
came from nothing, you
know, and, and worked
really hard and, you know,
pursued the American dream.
I genuinely believe that that is
accessible to a lot of people.
Now when I explain my story and
I say, Hey, you know, I lived
the American dream, here's
typically what I get in, in
today's environment, right?
I get, look, you're a
middle-aged white guy.
Of course you had the
American dream, right?
Like, and, and I get it.
I get it, right.
Um, yeah, it wasn't
quite that easy.
And so, you know, I came
from a, a very difficult
childhood in a very.
Ed environment, and I guarantee
you, by the time I was
graduating bottom, my class in
high school, no one was like,
oh, smooth sailing for that guy.
They were like 18 months
before he's in jail tops.
Like there's, there's nobody
who was betting on, on my horse,
at least of all me by the way.
But what I discovered almost
inadvertently was that I
had the ability through no
one else's help by the way.
I think this is the most
important part, and by no one
else's help, but also no one
else stopping me either, right?
Yep.
To be able to create and develop
a life for myself through
entrepreneurship, um, I would've
been a terrible employee.
That would've not gone well for
me, just not the way I'm built.
But it turns out I was a
pretty good entrepreneur.
Ryan, I think when we look at
the opportunities of planting
that seed, someone you know,
early in their life, not that
it's the only time they could
do it, I do think it is one
of the most valuable things
we can teach a generation that
is underprivileged, that is in
poverty all around the world.
This isn't just, you
know, United States or
anything else like that.
Yeah.
Go.
I think teaching people to fish,
you know, the, the old, the
old, um, uh, adage that if, if
you want to, uh, uh, beat a man
for a day, you give him a fish.
If you want to feed him
for the rest of his life,
you teach him to fish.
And I genuinely believe that
entrepreneurship is that
fishing pole, that ability for
you to earn for yourself, but
more importantly, to create a
flywheel in your community and
pull more people around it.
What do you think?
Yeah, I agree.
I think, I think that the
flywheel concept is super
important and you know,
we've, we've seen it, you
and I have seen it, it can
change communities, it can
change families, it can
change entire countries.
Absolutely.
Right?
When, when the
entrepreneurial spark starts.
I mean, like you said, that
is sort of what, what created
the, the United States.
Yeah.
And I think we can't
overlook that, right?
It doesn't mean that
entrepreneurship is for
everyone, meaning that not
everybody has to be a founder.
Everybody has to start
their own business.
But in some of these
communities, in some of
these situations, when
someone does that right, and
then all of a sudden you're
creating employment, you're
creating opportunities, you're
creating secondary economies
that flow down into that.
Right?
Right.
Like, you know, coming, you
know, having recently left,
uh, Latin America and, and
Guatemala in particular
where there were a ton of
impoverished people, right.
It's also a massive
hustle culture, right?
People didn't sit around
and go, ah, impoverished
dunno what to do.
They were like.
What am I gonna go do today?
What am I gonna sell?
How am I gonna do this?
Somebody would start a
business, business would
start to grow, right?
We saw, we saw somebody build,
uh, little things like a, a, a
very local restaurant, right?
Well, the local restaurant
creates a secondary economy
because you've got some
people that work there, you.
They're buying from the
local farmers, right?
The local farmers bring
up, local farmers start
to make more money.
They start to feed more
money into the economy,
and you get it, like the,
the whole thing snowballs.
It's economic development as
it's supposed to work, right?
Somebody generates
economic opportunity.
There's trickle over,
trickle down, and all of
a sudden you start to see
things, things blossom.
And I think the other thing that
gets lost in the mix in a lot
of cases, and we start saying
like, yes, entrepreneurship can
solve some of these problems.
People go like, yeah, of
course you guys think that way.
'cause it's what?
It's what you've done.
Yes and no.
But I also think that, and this
is what the piece that I think
gets lost is that it's such
an extensible set of skills.
Like it, it's at its core.
And I think you said this,
like you learned that you
could do this on your own.
On your own.
Yep.
Right?
With nobody else's help and
nobody else getting in your way.
Right.
It teaches you a lot about
self-reliance, which is
gonna be useful no matter
what you end up doing.
So I think we're not saying,
you know, entrepreneurship at
the expense of everything else.
But we're saying it's a
set of skills that if you,
if you master them or even
just learn them, understand
'em, intellectualize them.
It can impact a lot of
what you do in life.
Well, also it has this
massive germinating effect
of everybody around you.
Okay?
Yeah.
So if you think about
this, it wasn't that Will
started a company earlier.
You know, the company
did, did well.
It was that while he was doing
that, how many other people
did will impact along the way?
How many other
people did he employ?
At an un unreasonably young
age, not mine, but theirs,
it incentivize in condition
that they could do it.
I've told you this before,
in my lifetime, I've
hired thousands of people.
Yeah.
Within that group, I keep
a list a, a summary, if
you will, a spreadsheet.
Call it what it is.
Of all the people that I've
employed that have gone
on to become CEOs, right,
it's well over a hundred
people that I've employed.
Just me, little old me.
I'm not like that important.
I'm not being modest.
I'm just like, I'm not
freaking Steve Jobs.
Right?
Right.
A hundred people that
I've employed have gone on
to become CEOs, not VPs.
I'm not counting anybody.
That was also great
job, by the way, right?
Like Right.
Other C levels, I mean
specifically, these are
specifically the ones that
made it to top seat
the CEO E in, in most
cases, founders, right.
Um, in some cases of, of
massive companies like
representing billions
and billions of dollars.
And so what we're really
talking about and we're
saying alleviate poverty.
It's not making everybody
a founder, it's making
enough people, founders Yep.
At that flywheel and their
community and the people
around them elevates.
And I think it's incredibly
powerful and wildly
misunderstood about
how we get there.
Oh, a hundred percent.
Yeah.
It'd be funny to
look at that list.
I mean, fun, interesting
to look at that list now
and to see like how many
people have they employed?
That's
what I'm
saying.
Right.
That's what I mean.
Right.
What is,
what does that spread look like?
Right, right.
You know, it's funny, I I,
let me, let me give you the
other end of that spectrum.
These were, these were not
CEOs, but it's, it goes back
to just like how a little
bit of entrepreneurial
spark can go a long way.
When I was a kid, we used to
do like when, when there'd
be snow days, I think I've
told you this story before.
When there were snow days, I
got so excited, not because
we had the day off of school.
Because I knew I
could go shovel snow.
Right?
Right.
Make money.
I didn't just shovel,
show shovel snow.
I had a tractor.
I would drag driveways.
I would bring friends along.
I would, I had a group
of friends who then on
Sundays they would call me.
They're like, are we going?
Are we going?
Because they knew we
were gonna make hundreds
of dollars that day.
As you know, 13, 14, 15
year olds, we would go out
and we were all doing other
entrepreneurial stuff too.
It was super fun to see that,
like, because I had figured this
thing out and I had the drive
to do it, all of a sudden people
would flock around that and they
were like, we want to go too.
Let a bunch of guys into the,
into the tractor, and we'd
go out, I'd drag driveways,
shovel the sidewalks,
and everybody made money.
Right?
Right.
And it was super motivational
and it was fun because.
At least a couple of those guys
went on to be entrepreneurial.
Now, I don't think I caused
it, but I was certainly part
of that journey where they were
like, Hey, I can just go out and
find my own way, make my money.
I don't need to go get a job.
I can just go find ways
to hustle and make money.
Right?
Which I think is super
powerful to teach people.
You planted the seed of hope
and I think this is where it
starts, my own story that,
that I've given to you before.
When the seed of hope
was planted for me,
I'm eight years old.
I'm a kid who couldn't
even afford lunch.
Incredibly poor, generally
didn't know where my
parents were every day.
Uh, before I would go to school,
I'd be at the bus stop and
one day I had scrounged up a
quarter for whatever reason.
Lunch was a dollar at the time.
'cause I went to school in the
stone Age and uh, I go across
the street and I buy some no.
And later candies.
With my quarter, because
that's what I was
gonna eat for the day.
Like, that was my,
my meal provision.
I hop on the bus and a kid asked
me if he can, uh, have one.
I'm like, I can't, really
can't, I'm not trying to
be a jerk, but like, I
literally, that was my lunch.
And it's, it's, by the way,
being poor is humiliating
and one of things that,
you know, they don't put
in the, in the brochure.
And so I was like, can't.
He's like, well, what if I
give you a quarter for one?
Right?
And I was like, fine.
He gives me a quarter,
I give him the liters,
he hands 'em all back.
It only takes one.
And what he meant was I'll
buy one of them for a quarter.
One of them.
Yeah.
And somebody else overhears
gonna say, Hey, can I buy one?
And I'm like, yeah, he
gives me a quarter and
like my head explodes.
Like I had no idea
how commerce worked.
The concept of arbitrage
is born in Will's mind.
But that was
the moment.
Right.
And, and, and I, and I told you
this before at lunch that day.
I went to the lunch lady and I
gave her the first dollar I'd
ever earned to buy my own food.
I mean, very appropriate
for what we opened up with,
which was Teach A Men to
Fish, and it was game on
from that point on, right?
It was the first time I realized
without anybody teaching me,
I just fell into it that I
could create my own outcome,
and that is an incredibly.
Powerful.
Incredibly.
I mean, transformational
changed my whole life on a
random Tuesday that you'd
have never guessed, right?
And I realized at that
moment that my condition in
life didn't determine what
I was allowed to do, and
that created a seed of hope.
That's all it did.
It created a Seed of Hope.
And Ryan, how many founders
do we talk to that sold candy
in school that, that shovel
driveways, like literally
had the, I had the
lemonade wagon.
Not the lemonade stand.
Right.
We all did.
Same damn thing.
Right.
It's such a funny thing that
it's, it's a, it's a lesson
that gets learned so early in
life, and again, just a seed.
Not even necessarily a lesson.
It's a lesson of sorts, but.
I think that there's, there's
something really interesting too
that it, it tends to start early
and it starts small, right?
It doesn't take much.
I think that's the
thing, that's the point.
It's so encouraging about this.
It was a dollar like for
somebody else who's listening
and is saying like, yeah, I
don't really buy into this.
Like, it can start
super small, right?
That's the whole point.
We're not saying turn somebody
who's in, in what other words?
Like a hopeless situation,
resourceful situation into
the next, you know, tech
founder of, of a unicorn.
Doesn't have to be that either.
Right?
You know, it was, it was selling
candy, it was shoveling snow
and that was the other thing.
So going, going back to hope,
I don't remember exactly.
I do remember that.
It wasn't like the first
time I went out and I was
like, Hey, does anybody
wanna go shovel snow with me?
And everybody's like,
yeah, we'd love to.
Right, right.
It was after like the third
or fourth time that I had gone
out and made a couple hundred
dollars and they were like.
There's some hope, right?
Some hope was created like,
I hope I make some money too.
Like I will go do that.
And, and again, it was just a
little, little seed got planted
and then that's where it starts
to spread to others as well.
It's where
it spreads.
There's something called
jealousy that is also a
very powerful motivator.
Super.
We always see it.
Now we see it like in the
startup world where you see
one of your, what we'd call
your idiot friends get funded
and you're like, dude, if
that guy can do it, that guy's
got idiot got funded, right?
This can't be that hard, right?
I always joke that the reason
there's a hundred people on
that list of CEOs was because
of me, because they were all
like, dude, if that guy can
be a CEO, I can absolutely.
I got this, I set
the bar so low.
What's, what's after CEO?
I'm gonna do that,
but I wanna talk about, you
know, three different legs that
this thing needs to stand on.
But, but, but I don't wanna lose
sight of the hope component.
The reason, hope is so
fundamental before everything
else as a requirement
is actually because.
We deal in the business of hope.
And I don't mean that like
in a greeting card way.
I mean, if it weren't for
hope, we wouldn't go pursue
things that pay no money.
Right?
That would make no
sense whatsoever.
Right?
Let me go build something that's
never existed before to see
if people want to buy it and
make it enough fun that I want
keep doing this for a long time
until it's finally successful.
Absolutely.
No,
um, there's no hope
behind that.
Correct?
It's very quickly.
If we take away hope and reward.
Okay?
Reward is kind of a
given that if you do
something extraordinary,
that that's reward.
Now, that doesn't exist
everywhere, right?
If you're in a society that
fundamentally doesn't reward
risk, or a culture that doesn't
reward risk, you know, for
a lot of cultures they are
culturally biased against
entrepreneurship because
they don't believe in risk.
I talk a, uh, to this, uh,
a lot of my friends who
are coming from like an
Indian family or a nation
family, they're like, risk.
Risk is not.
Like celebrated the
way you guys celebrate
it, you follow the, the most
likely path with the shortest
distance to the largest reward.
Right.
Hundred percent.
Right.
You follow the educational
path and you become doctor,
lawyer, engineer, right?
And that's it.
And to be fair, that's a
hundred percent logical.
Yeah, that's a hundred
percent logical.
That is a very.
Obvious and logical path to go,
which is the problem, right?
The problem being, in order
to go down this path, you
have to have the hope of
doing the illogical and having
that have a better outcome.
If you're not inspired, if
you don't have that hope that
something better is gonna
happen, you won't even try.
We look at it and we say
someone has to feel so
good, so confident, if you
will, or hopeful hope and
confidence aren't, aren't
the same thing, so hopeful.
That what they're about to
embark on, however small
will have the reward they
expect it to, that they're
willing to do it at all.
And given we're in the business
of hope, that is, that is
a form of capital that when
you take it off the table,
nothing even gets started.
We don't even get to the
parts where you need like
dollar capital, right?
If, if in a society, if in a
community, if in a family hope
has been withdrawn, you will
never see entrepreneurship.
Correct.
Yeah.
And, and I think again, like
it's, as you said, it's,
it is, it is a currency in
the entrepreneurial space.
Hope isn't fairy
dust, it's fuel.
Correct.
It is literally what drives
it at certain points, right?
It is all we have right at the
earliest stages and sometimes
in the later stages when things
aren't going well, it's all
we've got and we have to be able
to rely on that as a propellant.
It's a powerful
one.
There's a line in the Matrix
that, uh, Larry Fishburne
gives as Morpheus Uhhuh, and
he says, uh, or maybe it's
not, I, I, I actually, I
think it's, it's whoever the
bad guy was, was at the time.
And he says, uh, hope it's
your, as a human race, it's
your greatest weakness.
It's your greatest strength.
Right?
And I, I thought that
was, that was such a
perfectly delivered line.
Yep.
And it's so true.
As founders, it's our greatest
strength and weakness.
It's our greatest strength
for all the obvious reasons
we just described, and it's
our greatest weakness because
it makes us do dumb shit
with a smile on our face.
Right?
Yeah.
It makes us take ridiculous
amounts of risk that can
ruin us with excitement.
And again, that is such
a powerful component.
Now let's talk about
how you, you, you get
that flywheel going.
Yeah.
So I think that's, I think
that's super important because
I think as, as people are
listening now, they're like,
okay, a great, but like,
where does it come from?
Right.
It comes in in.
Tiny, tiny, uh, successes.
Yep.
It's that kid selling candy
as that, that, that expands.
And so I, I say, look for very
tiny wins as early as possible
tied to your own outcome.
Yes.
Okay.
So if I say, Hey, you got
a job and you got paid.
Nothing wrong with that,
but let's say you, you're
15 years old, right?
You get a job and you get
paid, and you understand the
value of work and reward.
Incredibly powerful.
But it's different than
you created that work.
Yep.
In your case, it, uh, it,
it would've been in, in
looking for an opportunity
to shovel a driveway, right?
Yeah.
That you could get paid for,
and then doing it on your own
accord, you know, deliver,
developing customers, having
a product, pricing, et cetera.
I just thought one of the
funniest examples of, of
earliest early, early, early
entrepreneurship, we carried
our canoe, three quarters of
the mile down state, route
42 to get to Deer Creek.
We throw it in Deer
Creek to float inside.
At the local golf course
and we filled that thing
with, I think it was like,
I dunno, it was like 1800
or 2000 golf balls that had
been hit into the river.
We just dredged the
river for hours on end.
I love it.
Filled this thing up and
then we had to call my dad.
Actually one walked home.
There was no way to call dad.
I had to walk home, ask my dad
to come and bring the pickup.
So we could haul it back
because we were like, we
carried the canoe over when
it had 2000 golf balls in it.
We could no longer
carry it anywhere.
Now we've got, we've got all
the gold, we can't get it home.
But it's so funny like where
you just go looking for
these things and, and Right.
I think there's something fun
there because like that one was
pure hope we did all of that
work to go find out if there
were even golf balls in there.
Mean, yeah, we'd seen
some bad golfers.
We knew there was gonna be
some balls in there, but like.
Out in the middle of nowhere
at London, Ohio, and we are
carrying a canoe down a highway.
Hope was heavily involved there.
Like, I hope we go
find some stuff.
Right?
It's that mix of like hope
and adventure and that to some
degree, like a little bit of.
Childlike naivete just to say
like, let's just go do this.
Let's try it.
Right?
I hope it'll work out, but
let's try it either way.
There's something
really powerful about
that.
And the trick there is you
just need to inspire one
Ryan, who then ins, inspires
and, and cajoles and.
10 of his friends.
That's how Yep.
I inspired one Joey and one
Nick, and that's correct.
That's it.
Right.
Um, I think the mistake
is that like, you know, we
have a hundred kids in a,
in a classroom, for example,
and all a hundred kids have
to become entrepreneurs.
No.
They technically you just
have to get it right with
one or two if that Yep.
And they will pull enough other
people along that that's how
the flywheel, uh, gets created.
Now the other thing that,
that, that, uh, you know,
happens when we, when we
create that flywheel, is those
people go on to have kids.
Who are now inspired and
educated with that hope you
know, our children, Ryan,
are inspired and educated
with that hope, which
has so much value because
you're literally grooming.
The next group of
founders from Day Zero.
Incredibly powerful.
And, and what I love about
this, this mission, and again,
this is very ingrained in what
we do@startups.com, is that
you're basically saying, I
only need to be right as far
as, you know, grooming this
next ground one in a hundred
times, but when I'm right.
Yep.
It'll create a thousand
people behind it.
That's the part that
I think people miss.
Right?
It's a germinating effect.
But we, we need to start early.
We need to get those early wins,
you know, with with kids early.
It doesn't have to be kids,
but it's a great way to start.
I understand.
And even small wins are big
wins, even the small wins.
You know, Ryan, you and I were
talking a while back, you were
saying how like it's the person
in Guatemala with a food cart
and then all of a sudden they
come home and they had more
money than they had yesterday
or income at all and people go,
uh huh Food cart, not Microsoft.
Nope.
Fucking food
cart.
Right.
It's, it's the, it's
amazing the fence.
Right.
Figure out what's gonna take me
from where I am now to a place
that's significantly better.
Right.
Right.
It's not a life of luxury,
but it's a life where there
was steady income and they
could put food on the table
every day without question.
That's a big deal.
There are two very
different paychecks.
There's a paycheck you get from
your employer and there's a
paycheck you get from yourself.
Okay?
There's a pride that comes
with the paycheck that
you create for yourself.
Exactly how you felt when you
came home from a long day of
being a kid shoveling driveways.
You were tired, but that money
in your pocket was money.
Correct.
Right.
Yeah.
But it was money you created.
Still wake up the next
morning hoping it's
gonna snow again, dude.
Right.
That dollar I gave to the
lunch lady was the best dollar
I've ever spent in my life.
Right?
Not 'cause I could get lunch.
That was actually
pretty cool too.
But because it, it was my
dollar and I knew I could
do, I could make another one.
Remember
that
used
to be a thing like you would
see the first dollar, right?
In businesses.
You'd go into a business.
Yeah.
You'd sit up on the, on
the wall behind, right?
There would be the
first doll on the wall.
Why?
Because it took a lot of work
to get to that first dollar
and getting it felt amazing.
Right?
And it wasn't that it
was a dollar, right?
It's not about the amount,
it's not about the right.
It, it's such a symbolic
thing, um, that goes, goes so
deep into the, the experience
that that individual had
to get to that point.
Right.
And then to know, because
it's, it's a fundamental
representation of that hope.
We converted hope to pride.
We converted,
converted hope
to
when somebody
framed that dollar.
They, they were proud of
their accomplishment as
they should be, by the way.
Yes.
Proud of the accomplishment.
And it had been recognized
by someone else, right?
Someone gave them that dollar.
Someone said, you've
done something of enough
value on your own.
I'm gonna compensate you for it.
And if
hope is contagious, pride is
the bazooka cannon of contagion
because it shows everyone
else that it can be done
and that it should be done,
which is incredibly powerful.
So let's say that that hope is
the first leg, if, if not the
first phase, that if we don't
have hope, nothing gets started.
Like that is the
beginning of the flywheel.
Okay.
But the other side of
it I thought was kind of
interesting was this idea
of a willingness to fail.
Let's say that this is a second
lick and people say, well,
obviously in entrepreneurship
it's not like just taking
a job where you are going
to get paid, you're gonna
do a lot of work and you
may fail and not get paid.
But I think what people miss
when they, they hear about
that is people who are broke.
Can't afford to fail.
Yeah.
They, they don't realize that
the reason a lot of people
can't get into entrepreneurship,
you know, folks that, that are
in some level of poverty or
low income, uh, situation is
that failure is not an option.
Yeah.
And people used to say to me
all the time, this is weird for
me to even say this is actually
on a magazine cover where I'm
on the cover of the magazine.
Right.
And it said, um, something to
the effect of like, something.
Two, something to fail.
Uh, I I, I can't remember
what, what the, the phrase was.
I should know.
'cause it was on like the
cover of this magazine
wasn't nothing to lose.
Nothing to lose.
Right.
You know, something like that.
Right.
Yep.
And I think the idea was that I
was so young and I was so broke
that I had nothing to lose.
Yeah.
I think that is such a
gross misunderstanding.
Of what being
underprivileged means.
Yeah.
Dude, if I failed, I
could not pay for rent.
I had no home.
Right, right.
I can't pay for food.
I couldn't buy food.
I can't.
Yeah, yeah, yeah, yeah.
Like,
yeah, there's a lot to lose.
There's, there's a lot to lose.
There's way more
to lose.
And I think what's missing,
and again, this, this kind
of second leg in the thing.
Is understanding that folks
who are broke, I'm just gonna
You use, use that as, as
the, the, uh, overall term.
Yep.
Cannot afford to fail.
Right.
And therefore they
can't afford to try.
That's the thing.
Right.
Without any kind of gap
between you and the ground.
Like it's there, there's no
room for risk there really,
there's, there's just no
space for risk at that point.
And, and that's a tough
one to get around.
It's a very tough
one to get around.
You know, something that's
really funny about everything
we talk about here is
that none of it is new.
Everything you're dealing
with right now has been done a
thousand times before you, which
means the answer already exists.
You may just not know
it, but that's okay.
That's kind of what
we're here to do.
We talk about this stuff on
the show, but we actually
solve these problems all
dayLong@groups.startups.com.
So if any of this sounds
familiar, stop guessing
about what to do, let us just
give you the answers to the
test and be done with it.
You could go back and you
could say, well, hold on a
sec. That doesn't all hold
up, because many of the
immigrants that came to America,
um, came with nothing and
started phenomenal companies.
And it's like, yes, there
is a version where you can
say, I have no choice to be
suc, but to be successful.
But you didn't have that choice.
It's not like I chose to fail.
Right.
So saying you, you didn't have
any choice but to be successful.
The implication, which isn't
entirely wrong, is that I
just had to keep grinding.
Like I, I, I just couldn't
stop, uh, stop myself.
I couldn't give up because I
didn't have anywhere else to go.
Now there's some truth
to that, but that doesn't
guarantee success.
You couldn't have that same
condition and fail being at rock
bottom where there's nowhere
to go but up, doesn't
guarantee that you go up.
You can also just risk and
stay at rock bottom, right?
Correct.
You can just, you
can if nothing else.
Risking in that sense, when
there's no safety net it,
it can actually absolutely
make a bad situation worse.
Let's just say it's already
wor as bad as it could
possibly be, it's also gonna
guarantee that you stay there.
Correct?
Right.
I, I'll give you some examples.
I had so little money that a
meaningful capital cost, and
I'm talking like a hundred
dollars, was inaccessible to me.
I remember going to the ATM to,
to the Chase Bankers Bank one
back then, uh, ATM on campus.
And I needed to get like
$16 'cause I knew that
that's exactly how much
I had in my bank account.
But the ATM only dispensed
$20 bills and I could
not get my money.
I was so pissed off.
I I couldn't get my $16
out, you know, out of
the bank that I needed
keeping my fortune from me.
Correct.
Right.
And, and so I guess
what I'm saying is, at
that level, you are so.
Fundamentally constrained.
Yeah.
That it's actually just
way hard to be successful.
Yeah, because like, you
can't go without a paycheck.
I'll give you an example.
You know, I'm building a
house and all of the different
trades that, that are, that are
working, like the electricians,
the, um, concrete guys,
whatever, are all floating
some payroll capital with
their, with their crews,
some, uh, capital for the, the
supplies, materials until the
job is done and they get paid.
Well, that's a luxury.
To be able to have
access to enough credit.
Yep.
Yep.
That you can pay someone
this week, even though
you're gonna get paid later.
Poor people don't have those
fundamental luxuries, right?
They, they don't have access to
credit, they don't have access
to capital, and by virtue of
that, they don't have that
pad, that luxury of failure.
Which prevents them,
fundamentally prevents them
not only from, from uh,
getting started, but from being
successful, even if they are
started, I think it's very
misunderstood when folks are
saying, nah, let's just, let's
help these poor people out.
You know, like, like in, in a
very like, kind of sardonic way.
Like, yes, you want to help
them, but dude, if you don't
understand their condition,
you're not being very helpful.
Right.
What I'd say.
If you give, you can give
people, like, let's say the
understanding, the motivation,
the hope, all of that stuff.
But if they're still in a
position where risk is a
luxury they can't afford.
Yeah.
Especially if family
can move forward, right?
Yeah.
It's, it's a hell of an anchor.
And so, you know, when we
talk about what do you do
in that situation, right?
Okay, you wanna help these
folks out, but they actually
don't have the luxury of
doing what you're asking
them to do, which is mm-hmm.
Which is assumed risk.
You've gotta provide
some level of cushion.
That's usually where
capital comes in.
Ryan, I've been banging
my head against the wall
for decades thinking about
what this looks like.
So I, I wanna beat this
up a little bit with you.
There's kind of two schools
of thought on this one.
Okay.
A, a as I've seen it, and
I'm sure there are others,
one is some form of, of
entrepreneur welfare.
Vis-a-vis, you know, some
sort of grant program or
some like universal basic
income, uh, which I know
is a, is a KG topic, but
UBI for entrepreneurship.
Okay, sure.
So some sort of like, Hey,
let's, let's give that person
just a little bit more net.
In order for them
to get further.
Yep.
I don't think a lot of people
would argue if, if they could
see it being used properly.
Okay.
The other side of it, of course,
is just straight up like venture
capital for, for low income.
Right.
Like, um, this isn't a
grant, this isn't like, you
know, you don't pay it back.
It's, it's not welfare.
Is an actual investment
and you have to pay it
back or said differently.
Like people don't pay
venture capitalists back
unless there's a, an upside.
But you'd have to
see enough return.
You know, it's kinda
where like social impact
investing comes on debt.
It could go venture debt to be
able to make that work, right?
It could do something debt,
venture debt kind of, it
could be the form of loan,
could be Right, right.
When you look at those two
versions, like, I hate to
use the term welfare 'cause
that's got such a stink to
it, but, you know, some sort
of support program, social
safety net or you know, social,
and I'm not trying to just
rebrand it, I'm just saying
we aren't just talking about.
Paying people to not work.
We're paying people
to work like hell.
And then the other side of
it is, uh, an investment with
an expectation or return.
How do you see those two camps?
Like, you know, which one kind
of appeals to you differently?
Like, you know, where do you see
them, them working differently?
Challenge is because we're
trying to talk about,
we're, we're trying to talk
about how to elevate people
out of the risk component
of it,
right.
How you, how to capitalize
them so that they can pay the,
the, the workers and materials
on the concrete job so they
can do the next concrete job.
And again, I'm, I'm being very
simple, but like Yeah, yeah.
If it's something that like, so
if it's that specific, right?
So if you can get into a
situation where like they're,
let's not say there's a
guarantee, but like, it,
it's almost factor financing
at that point, right?
Mm-hmm.
Like you're, you're just
essentially saying like.
We're gonna, we're gonna be
able to give you money, uh,
to, to overcome cashflow gaps.
That's one thing.
If you're saying venture debt
at a larger level, where it's
gonna be based on some further
down the road, possibly type
outcome, that still feels
like, depending on how it's
structured, that could still
have some, some risk to it.
Right.
Right.
For the fact that may
not be looked at as,
as completely unrisky.
Maybe I'm just becoming
more of a socialist as I,
as I get older, but like I
do feel like providing some
sort of a. Minimum basic
income for, for founders.
Again, minimum basic income
for founders based on other
socioeconomic factors, right?
Right.
The same thing you have to do
to go through like fafsa, right?
You have to go through and,
and, and file your federal
form for financial aid, right?
If you qualify, you get
this much, and here,
here are the terms.
Something like that feels
fairly interesting to me.
Actually, hold on, pause.
You know, Ryan, I never
drew that parallel.
I'm so glad you said and,
and I'm gonna hand this back
to you in a second, but I
want you to build on that
we have exactly this welfare
program
for
education.
Yes.
But, but it, it implies going
to get some capabilities
to work instead of just
actually going to work.
Right.
So to me, if that's what
we're trying to create
is employable people.
Employ them right directly.
Let them employ themselves,
uh, let them put whatever
skills they have to work.
And again, there could be some,
you know, the, the FAFSA in this
case would look a bit different.
You would, you'd have to
show some capabilities.
You'd have to show some, uh,
not, not just need, right?
It's not just need based.
Um, but in the same way,
like even, even with fafsa,
really, you're passing two
tests at, at the same time.
You're passing the entrance exam
to the university and you're
passing the, the requirements
from a financial standpoint.
So if you could do both of those
things at the entrepreneurship
level, I'd be all for that.
There's gonna be metrics
you have to keep hitting.
Just actually the parallel's
beautiful, because in the
same way, if you start getting
garbage grades, you're out.
If you don't hit your metrics
that this set aside for that
business, whatever that is,
like you gotta hit revenue
by by month two, you have
to start employing people
by month five, whatever it
is, like we can come up with
the criteria for, it doesn't
feel that hard to manage.
It has a much more direct
and measurable outcome
than an education.
It's got a very
powerful, almost
like self-direction,
self-motivation, self-interest.
Like one of the problems I
have with paying into the
university kind of scheme,
if you will, is that there
are really no guarantees.
It's like, oh, you'll get a job.
Maybe.
Who knows how I was gonna
get that job anyway?
Right?
Like it's really hard.
Ask recent graduates
right
now, how guaranteed that is.
Yep.
I guarantee they feel, but,
but I guess what I'm saying
is there's something really
fascinating about this idea
that the government, as an
example, as these main funding
entity, feels very confident
that if we send more people
through this, this amorphous
thing called education higher
ed, that will get payouts.
So we should heavily subsidize
at both the state and federal
level families feel that way,
that we should save for college.
Because you know, that
is the thing, and this
isn't being anti college.
Dude, if we already have
this program and it's very
well understood and like
imagine if we call that
a welfare program, right?
An educational welfare
program, which it is.
But here, here's what's
interesting about it.
Nearly every student loan is
a non collateralized loan,
which is damn near impossible.
For a founder to get said
differently if I say I want
a non collateralized loan
because I'm gonna become a
theater major, which I was,
so I did make that ask.
Right?
We're like, dude, red
carpet, here's all the
oppor opportunities for you.
Yep.
But if I wanna take the same
amount of capital and I want
to go build what became a
$700 million company, they're
like, outta luck, no interest.
Yeah.
Right.
None.
Get outta here.
None whatsoever, whatsoever.
Go away.
Theater program.
Yes.
And, and so, uh, the
irony, right?
The irony, but, but the
parallel there is beautiful.
Yeah.
I mean, like, it's literally
staring at the face.
It's, it's sitting there that,
that is the, the framework
that you could easily just
sort of copy, paste over top
of entrepreneurship, couple
little tweaks, and you're
retrofit and ready to go.
Right?
And we have no issues with that.
And the other side of that is
think about the scale at which
that operates, and think about
the scale at which you would
need this for entrepreneurship.
There's not going to be nearly
as many people that would want
to do this as that, right?
So it it's also an
infrastructure to be
far easier to manage.
Think about when you end
up giving money to college
students, it goes to one place.
Well, two places.
The local beer hall
and the university.
Right.
But it goes to the
university, right?
When you give money to
entrepreneurs, where does it go?
It doesn't go in their pocket.
'cause Yes, yes.
We can create some sort of
minimum livable thing, right?
But also it's gonna go to.
Local suppliers, it's gonna go
to their employees, it's gonna
go to other service providers.
Literally it's go
drive the economy right
back into the economy.
Yeah.
You directly drive the economy.
Now here's what's
also interesting.
You put somebody through
four years of, of undergrad,
okay, and they go on to
become middle manager.
They're gonna generate a tiny
amount of payroll taxes, you
know, by virtue of, of what they
kick into the system, social
security, what have you in the
us, but you create an employer.
They're gonna pay payroll
taxes, which a lot of people,
like, a lot of people actually,
our, our listeners definitely
know this, but a lot of people
don't know that employers
match the amount that, you
know, in payroll taxes that
they pay directly in addition
to what you're paying, right?
Yeah.
So like, like I love when
people say, uh, Jeff Bezos
or Elon Musk doesn't, don't,
doesn't pay their taxes.
Dude, do you have any idea
how much Tesla or Amazon has
paid in payroll taxes, right?
Yeah.
More than any human will ever
pay in a million lifetime.
No
loopholes for those.
Zero.
Loopholes for those.
It doesn't matter.
Come on.
Right?
There's a loophole for
everything when you're wealthy.
Nope.
Taxes get paid
every single time.
As business owners, do you have
any idea how many taxes we pay?
Right?
Yeah.
Like, you know, like
without even trying.
And so my point is, you give
this money directly to the,
the right individual, meaning
just somebody who has, has an
affinity for entrepreneurship.
You're not only, you know,
quote, quote, like paying for
an education, but you're also
paying exponential amounts
of givebacks and taxes.
You're then creating jobs,
you're then inspiring
more people, I mean.
The investment on an ROI basis,
we're gonna take Pell, you know,
in everything you, you pick
up through fafsa, et cetera.
Yep.
And instead, pour 10%
of that specifically
into entrepreneurship.
Dude, the ROI on that.
Yeah.
Would be, it feels pretty hefty.
It feels pretty hefty.
I feel like we need to
call somebody will, if
only there was a platform.
Right.
But I look at that as well.
Just going back to the,
you know, failure of,
you know, being a luxury.
That's essentially what
we've done in education.
If people had to pay outta
their own pocket, right?
There was no loan program,
there was no subsidy.
You had to pay with your
extra cash, which I did.
'cause I worked my
way through college.
You'd never do it.
I was making 10 bucks an hour.
Like trying to pay
for, for education and
everything else like that.
And it was brutal.
And I was paying cash on
the barrel head 'cause I
didn't have access to debt.
And I guess what I'm saying is
like we have a program now that
honestly doesn't work that well.
You know, being higher
ed where we are already
deferring failure.
We are saying, look, we get it.
You, you can't live, uh, and
go to school at the same time
and, you know, afford to fail.
So for four or five, sometimes
six years, uh, not counting
grad school, we're gonna, we're
gonna fund you, we're gonna
make sure your, your bills
are taken care of, that your
necessary expenses are covered.
Yeah.
So, so that you can, that,
that you can have this pad
in order to do this thing, to
go do it.
That's it in entrepreneurship.
That's it.
We have one program, it's
called Go Fuck Yourself.
Yeah.
Right.
And you still have to pay
to employ at every level.
Yeah, exactly.
That's our fafsa
and it's brutal.
I, I genuinely believe that
creating a safety net, and,
and I mean this in a, the most
productive way possible, would
have a massive impact on a
lower income or impoverished
community that would allow
them to do things that
they just simply can't do.
I think that's,
that's the second leg.
Give people.
Just enough pad to allow
them to, to, um, absorb some
failure to create success.
Well, man, just hold on
that for a second and think
about, think about how
that impacts the first leg.
Think about how knowing
that you have that, think
about how that changes.
The hope dynamic because there
is that line you have to draw
with like, am I being, is
this hope or is this delusion?
Right.
I mean, fine line because I, it
depends with the outcome I want,
but I'm held back by, if I'm
held back by the risk component.
If I can't risk, then
hope is just delusion.
If I, if I actually can't go do
the thing, it is just delusion.
And so if we can have hope,
but if hope can be built on
a foundation of, of what?
Just basic security.
Right?
Right.
Yes.
Basic security.
Yes.
I'm not going to
starve to death.
By trying to do this, then I can
actually put my hope to work.
So if we're talking about
fafsa, we're talking about
education, that leads us to
the third leg, which is the
idea of a bunch of people in
any community, impoverished
or or whatever, going out
and building successful
startups with no access to the
education of what this takes,
the mentorship, et cetera.
Yeah.
It's the equivalent of saying
we want more doctors, but we
won't have any medical schools.
Right.
In order to become a doctor,
you sort of have to go out
there on your own, get some
surgeries under your belt,
kind of figure it out.
And if people don't die in the
process, you know, you get a
high five, you become a doctor.
That's literally what
entrepreneurship is.
It's go out there,
figure it out.
You we're gonna give you
no education, we're gonna
give you no guidance.
And if you somehow figure
out one of the most complex
possibilities that you could
possibly encounter, then
we'll tax the hell out of you.
Yeah, yeah.
Then we'll then we'll tax you.
Yeah.
Yeah.
I think that, I teach this,
this class in middle school,
uh, at my kids' school on
entrepreneurship, and what
I tell the kids in the first
day of, of class is that what
I'm going to teach you, I'm,
I'm gonna teach you what's
possible, essentially hope.
Right.
But I'm also gonna
give you the tools, the
specific tools to go do it.
Do it.
Yeah.
And I, and I call that
agency the ability to, to
recognize that you can be your
own, um, governance in the
tools to make that happen.
What we do@startups.com
is funda, it's literally
what we do all day long.
We teach 1.3 million companies
and the founders within them,
that agency, those tools, we
give them that mentorship to
say, here's what to go do next.
Yeah.
And they're like, damn, I didn't
know I was supposed to do that.
And I was like, how could you?
Yeah.
How would you, how would you
know, why would you doing this,
right?
Yeah.
Right.
You're not in medical
school, you're in
entrepreneurship where there,
there is no one to tell you.
Yeah.
Correct.
I think what we're missing,
um, and again, this is directly
part of what we, what you
and I do, what we're missing
is a very structured way.
To say here are like the 20
things that you need to know,
whether it's fundraising,
uh, getting customers,
you know, you name it, but
here's how to actually do it.
Yeah.
Because the chances are that
wherever you came from, you
actually know how to do all
of these different things.
All at the same time, all
related to a product that
you just invented five
seconds ago with a team
that never existed, um, in a
market that probably doesn't
exist yet is zero, right?
Right.
It's zero, right?
Zero.
And yet the fundamental programs
and access and fabric of
teaching people how to do this.
Is so fucked up.
Yeah.
Like it's so bad.
It blows my mind that we have
as many successful founders
as we have given how insanely
broken the education and
mentorship component is.
Yeah.
Worldwide
goes back to that
hope component.
And look, hope doesn't always
come from, from a position
of like, I have nothing, so I
hope I'll get something right.
Hope comes from like seeing
that problem you wanna solve.
It comes from, you know,
wanting to make that
dent in the universe.
It comes from not wanting
to suffer anymore, from
something you've suffered
from, or not wanting
someone else to, to suffer.
And so I, you know.
It does, it makes
a lot of people do
really crazy shit down.
Do it right.
No,
I, I agree.
What's crazy to me, okay,
imagine a founder checked
the first two boxes.
They said, you know, I've
got the hope I, I actually, I
genuinely believe in, in myself
or my opportunity, or I even
believe that the world exists
in a way that, that, that
could potentially benefit me.
Not everybody feels that way.
Second, I've got a
tiny bit of capital.
Forget how I got it right.
Yep.
Just I have a tiny
bit of capital.
Or I live with my
parents and a safety net
keep feeding me right?
Some sort of safety net.
So I got those two things
covered, but I still know
what the hell I'm doing.
That is the given no matter
where you're coming from,
we have people coming to us
from all walks of life, from
the most impoverished to,
to the most, uh, privileged.
But the one thing that they
share is they've never done
this before and they have
no idea what they're doing
and they're terrified.
What a massive impediment.
I go back to again, I, I
always use the, the, if
everybody wanted to become
doctors, but med school didn't
exist and you just all had
to figure it out as you go.
First off, think of how
many doctors we'd have that
are the most terrifying
doctors of all time.
Yeah.
In second, think about how many,
how few doctors we've have.
'
cause they would've gone
through, uh, you know,
but think of how
doctors we have.
We'd have, we wouldn't
have hospitals.
We you have it now, right?
Like it would be so
unheard of that that would
even be a career path.
Right.
You know, that that would be
the, the child of an Indian
family being like, Hey, a mom,
dad, I wanna become a doctor.
Like, oh God, no.
Don't do that.
Right, right.
We're just gonna go figure
stuff out and maybe
like not kill people.
It is funny because when
we look at like how much
entrepreneurship drives
the economy, right?
Yeah.
Like when we look around,
like a lot of the businesses
that we engage with, most
of the things that we do.
Had some level of
entrepreneurial
beginnings, right?
Like Correct.
Even hospitals to some degree
had an entrepreneurial element
to them because we used to just
have yes doctors, and we had
offices and we had surgeons, but
we didn't have hospitals, right?
Hospitals really the
business side of medicine.
And so despite that, we haven't
created this sort of certain
pathway around becoming.
An entrepreneur that
we have around these,
these other things.
And of course we've, we've
right done some things right,
like there, you know, there are
university programs to teach
you how to be an entrepreneur.
I think you and I
would both kinda.
Shake our heads a little bit
at the outcomes there, but like
there's some stuff has happened,
but not, not nearly as much.
Right.
I think for a
lot of people, Ryan, I, I think
the part that they want to do
it, but they have no access.
Or even if they had access,
like I can get into Harvard,
I can get into their education
or their, their entrepreneurial
education program.
I don't even if they have one.
Um, but assuming they did
it still probably isn't
gonna teach me most of
the things I need to know.
Like, in other words, the places
people would fundamentally
go generally just don't
work well intentioned.
Always well intentioned,
but fairly ineffective.
And so I look at it and I say,
damn, dude, that seems like a
pretty big problem if what you
just said a moment ago, which
is so true, that in the United
States alone, it literally is
the definition of a startup.
You know, it was started by a
bunch of of founders who then
had a crazy idea to go into
an unproven market, right?
And we're willing to fight
for it quite literally, and
created an atmosphere where
hope was its greatest asset.
You know, people come to
the United States because
they believe that their
lives can be better.
Yes.
There aren't a lot of countries
that have that universal
calling card that says, your
life will likely be better
if you come to this country.
Uh, incredibly powerful asset.
Right?
Yeah.
One questionably that
maybe we're trying to
destroy right now, but
I'm not gonna be political
about it, but that said.
We then have this ability, um,
for people to come here and
say, damn, dude, there's enough
wealth here, generationally,
et cetera, that there's enough
people out there that can make
these sacrifices and we have
enough of a social safety net.
Again, that's even coming
down to there's people that
can live with their parents
'cause their parents can
afford to support them in
order to take some chances.
There are many countries,
many parts of the world
that's not even an option.
Right, right.
Like, uh, if you don't work
in, in bring in money this
week, we're all screwed.
So of course you can't not
work and not bring in money
this week 'cause you might
bring in more else, uh, later.
But then if you think we built
a country this big and this
powerful as far as an economic
engine without ever having
any formality as to how we did
it, it's kind of mind blowing.
It
is.
Like, how the hell did we
even get here?
People that were willing
to take the risks.
Right.
We got here despite ourselves.
Yeah.
Despite, despite the odds.
Look, it, it, it did
cost a lot of people.
Everything.
And there's plenty of
stories and, and Right.
So it's, it is not, yeah.
The, the, the, the road to
entrepreneurial success is
paved with the failures of
others in a lot of ways.
It, it is.
And I think one of the
questions we're asking is,
does it have to be Right?
Does Correct.
Does it have to be.
Massive success
versus abject failure.
Why are we right?
Why are we drawing
this hard line?
Um, and why are we, why
are we not creating better
conditions such that, you
know, the outcomes could be
better defined, the outcomes
could be more reasonably
achieved, uh, de-risk it for
people a bit like, I, I think
it would be amazing to be
able to do that and correct.
Amazing.
At a lot of levels,
not just to say so.
Oh, so people can try it, but
like when it starts to work
and I guess it's, you sort of
have to look at that and go.
If it's already worked to
any degree, and we can look
around and go, it's actually
worked a hell of a lot where
you and I sit right now.
We're in two different places.
We're using a tool right
now that was built by
someone, uh, an entrepreneur
to facilitate this type
of video communication.
I'm using an an iPhone
started by, you know, built
by one of the most famous
entrepreneurs of our, our, our
generation to film this thing.
And just like all the stuff
that's surround us, like
we're surrounded by this
stuff, clearly it works.
So the fact that
we're not doing more.
As a society, as a nation,
as, as, as a community, just
even global entrepreneurs, to
provide a better pathway for
this feels kind of bananas.
Well here, here's
what I would say.
You know, the initial
question, can entrepreneurship
help alleviate poverty?
It already has.
Yes.
It didn't make all
poverty go away, right?
No.
But if, if you had any
question about whether
entrepreneurship can have
the transformative effect of
transforming communities, it
did for an entire country.
Yes.
Right.
Entrepreneurship, like
the America is a case
study of entrepreneurship.
Yeah.
At so many levels.
And so to your point, just
a moment ago, the fact that
we haven't said, oh, I know
let's go all in on this
thing, in a very deliberate
manner, to inspire hope, to
create that, that safety net
to, to get more people to be
able to, to make that leap.
And this is everywhere by
the way, you know, globally.
Yeah.
Yeah.
To be able to provide the tools
to say, and here's how to do it.
It blows me away that it
hasn't been done formally and
deliberately on a global scale.
What's so exciting about it
is the fact that as we head
toward this path, toward
this goal, everything we just
described, of inspiring hope,
of creating a a, an environment
where you can try in creating
the tools to teach you how to
do it, we actually don't even
need to get it that right.
Success compounds,
success compounds.
We need to be right one
in a hundred times because
when we are, that one is
going to exponentially
blow up this flywheel that
we're trying to create.
So all we need to do a, as a
society globally isn't to try to
make everybody an entrepreneur.
It's to try to plant the
seeds so that we get a few
and those few plant the
seeds to get even more.
Yeah.
And we make entrepreneurship
a fundamental part of the
fabric of our society globally,
which gives everyone the
opportunity and the hope to
build something and build their
own life on their own terms,
exactly how they wanna live.
Overthinking your startup
because you're going it alone.
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you shouldn't because instead,
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Connect with bootstrap
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helping them win in the
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