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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 the episode of
the Startup Therapy Podcast.
This is Ryan Rutan,
joined as always by my
friend, the founder,
and CEO of startups.com.
Will Schroeder will, we're
in the startup space.
We are in the business
of bigger, right?
But at what point is
bigger still better?
And what if getting bigger
just makes us a like a.
Worse company.
Isn't that funny how
heretical that is Like
in the startup world?
Yeah.
Like you're like, we wanna
be as big as possible.
Yeah.
But will you be
a shitty company?
Probably.
Yeah, probably.
But we'll be a really
big shitty company.
Yes.
And that just like,
wait, hold, hold on.
Wait.
Like you just said, you're gonna
be a more terrible company.
Yeah.
But it'll be a bigger,
more terrible company.
Really big, terrible company.
And I think of how many
companies out there
have gotten bigger.
And they just suck now.
And I, and I always think like,
okay, let's, let's, let's use
like more current examples like
Google and I have a tremendous
amount of respect for Google.
Imagine who Google was as like
a concentration of talent.
Yeah.
In their heyday.
Right?
Smartest
people in the world.
Right.
Versus who they are actually
here, here's another good one.
This is this kind of a,
a curve ball, PayPal.
PayPal when it had Elon
Musk, Reed Hoffman, uh, Peter
Thiel, like, I mean the,
the, the list of people on,
I mean, like even their B
players ran public companies
or started public companies
like Yelp and stuff like that.
It was the startup
version of Oceans 11.
Yeah.
Right.
That's a great way to put it.
All the stars were in it.
Yep.
Everyone you wanted was in that
was in, that was in that show.
Yep.
And, and think about PayPal
now, and maybe you got bought
by eBay and then whatever,
but like, do I have to?
Yeah.
Oh, by the way, uh, fun fact.
Fun fact.
The.
CFO of PayPal at the
time was 27 years old.
I mean, they were
all super young.
Uhhuh, who was, uh, Ruloff?
Botta, the managing
partner of Sequoia.
I mean, dude, their CFO
was the managing partner.
Yeah.
Come on, man.
Right?
Yeah.
And like, feels,
feels slightly stacked
as PayPal grew and became
whatever behemoth it is today.
Is it a better company than
it was back then, which is
where our story begins as
we scale, as we add stuff.
Is it making us
a better company?
I'm gonna argue, and I, I
think you're in the same boat
that it usually does not.
And yet, ironically.
For as much as we focus on
growth, we have almost no
focus whatsoever on quality.
Like, are we a better company?
Yeah, we're bigger.
No, no, no.
We're
bigger.
We're way shittier than, right.
More money, more
people, more problems.
Wait, did I say the last part?
Yeah.
Right, right.
Yeah.
Man, I always think of scale is
the, is the distortion knob on
the amp that is your startup.
Little bit rocks too much and it
just, it gets way outta control.
You, you crank analogy too far.
Analogy.
And you just end up
with a bunch of noise.
Right, right, right.
And, and the quality in, in
the tune has, has gone and
you're just overrun with
distortion at that point.
And I think that it
really does feel that way.
So unless your spinal tap, you
should not turn that shit to 11.
Okay.
You should not do that.
Think of how old that
reference is now.
Do you, you know,
they're bringing it
back.
Do you know they're
doing a new one?
Of course, they're,
yeah.
Yeah.
Well, because we've
run outta new content.
So what's interesting to me
here is like, let's, let's
start from the premise Sure.
That, okay, as this thing gets
bigger, is there a chance that
it's gonna get more shitty?
Okay.
In order to understand how and
why that happens, we've gotta
kind of talk about these hidden
costs of, of getting bit, right.
And I think when you're early in
your career, like as a founder.
You tend to think of these
things as goals, right?
Like, we're gonna
add more staff.
Sure, we're gonna add more.
More managers.
We're gonna add
more product, right?
These are all the things we want
to do.
Correct.
You're dying to do.
We're gonna raise more capital,
we're gonna have more investors.
We're gonna have so
much more, right?
And the whole thought is
more cash, more people,
more product, more you know,
more, more market share.
Like everything better.
No one ever stops to say,
Hey, maybe this will make
things really terrible for us.
Right?
Yeah.
Yeah.
And when it does,
everyone's so shocked.
They're like, wait, hold on.
Like, we hired a bunch
of people and now our
culture's gone and Right.
We brought in a bunch of
investors and now we basically
just report to the board
all the time and we built
all these products and now
it's a nightmare to, to
maintain all this stuff.
And that's exactly it.
We all of a sudden now have
this like big weird beast
that we have to manage.
Yeah.
That's a billion problems
we didn't have yesterday and
we work so hard to get them.
Yeah.
Every single layer that
we add takes a toll.
Mm-hmm.
Right.
Decisions slow down.
Context becomes thinner
because you don't get that
osmotic effect of just
being in the same rooms.
It is what I call, you know, it
goes from being the, the lunch
table to the committee decision.
Yep.
Right.
So the context thins down.
Culture diffuses you said that.
Right?
But that, that's a,
that's a huge one.
And depending on how important
culture was, uh, for you
and I, it's super important.
That can be the, the death of
the startup and not necessarily
in the, in the sense that like,
oh, the startup's just gonna
be done now because of this.
It can be the, the death
rattle for the founder.
At least I remember this
happening in, in my agency.
This goes back to, you know,
ancient history now, but
in the early two thousands,
uh, when, when I was scaling
my digital agency, the team
grew to a size where things
started to get really campy.
And the culture became
really diffused.
There was the sales team, there
was the design team, development
team, and the executive team.
And all of a sudden I
realized that like there
wasn't cohesion anymore.
And it, I really didn't like it.
It wasn't like I was
walking through enemy camps,
but it was damn near it.
And I was the CEO and founder.
Yep.
Right.
And so imagine how it
felt for everybody else.
I remember on my 27th birthday,
uh, I remember walking into
the office and by this point
we had like 700 people.
And I remember walking
into the office and being
like, I don't wanna walk
through the front door.
Not 'cause it was my birthday.
That, that part actually
didn't bother me, but
because I was like, I don't
like where I work anymore.
Right.
I, I just stop right there.
Yep.
I worked so hard to get there
and I didn't wanna be there.
Yeah.
Here's why.
Because it sucked Now.
Right.
Like all the things
that that like kind of
made it cool, went away.
We had so many people, like
I'd be on an elevator and
I had no idea who a single
person was in the elevator.
Who else was on there?
Right.
They knew I was right.
I still got like a sore
thumb, but I had no
idea who anybody was.
We had tons of meetings about
upcoming meetings, right?
Yeah.
A meeting about an upcoming
meeting that we're gonna have.
Right.
And I'm like, this is
the lamest thing ever.
Now I get it, but
there's no version.
When we were going through
this, you know, transformation
where I was like, you know,
what'd be really awesome if
we get to a point where we're
having meetings about meetings
or where I could go anywhere in
the building and probably not
know who a single person is,
like, can't wait to get here.
Or my favorite, we have $10
million a month of payroll.
I can't wait to have
that liability, uh, every
night when I go to bed.
Right?
Yeah.
Like that feels good.
Those levels of problems.
I was never like, this
is gonna be awesome.
Or how about this, uh, you
could appreciate from the
agency world, a single client
that if they change their
mind, I have to fire everybody.
Yeah, so, so that's an
interesting one and because I
think that's one of those things
that a lot of startups chase,
whether agency or anything.
We chase big logos, right?
Big customers.
Yep.
Big logo customers.
What I realized at some
point, uh, were that those
were roadmap handcuffs.
Yeah.
Right?
Yep.
Their money starts flowing in.
My autonomy just
started flowing out.
We were just building
what they wanted built.
It started to dictate a
lot of what we were doing.
Because from a financial
standpoint, they were,
they were super important.
So we got a lot bigger.
We didn't get a lot better.
We got better for them.
Yeah, right.
Um, but not necessarily for
the rest of the customer base.
I think to me that was one of
the ones that was least obvious.
'cause I think some of this
stuff like decision making
speed, I think you understand
as you get bigger, yeah, there's
gonna be more red tape, right?
Yeah.
And we go from lunch table
speed to committee speed,
the headcount creep.
I think everybody sees
that one coming, right?
It's gonna mean more managers.
More meetings, less access.
We don't push back on it shit.
But
right now, that's
the issue, man.
Uh, no one says, Hey, maybe
we shouldn't do this because
we'll be less efficient.
Yes.
Like, well, we need
people, so hire people.
And that's, that's all there
is to
it.
Right.
It's, it's a foregone conclusion
that this is just, it's
a cost of doing business.
Right.
Exactly.
Is it The cost of doing
business is one of the most
empty, horrible pieces of
advice that I've ever seen.
Right.
And my appendage to that
is according to whom.
Right.
Right.
You know, that's just the
cost of doing business.
Yeah.
According to which person
that had no vision or
no creativity that could
have avoided this outcome.
Right, right.
It's already stuck on the other
side of it and trying
to justify it now.
Yeah.
Right.
In
instead of making it this
like universal axiom, I
always like to point it
at a person specifically
and say according to them.
In what they know.
They think that's,
that's the best decision.
When you humanize, you're
like, well, fuck, what
the hell do they know?
Yeah.
This is such a good advice.
Anyway.
Sounds nice.
But so when we, through
some of these things, right?
So we, we've talked about
decision making speeds, you
know, the, the bigger customers
and, and again, the point I
was trying to make there was
not that there any of them are
justified, but that some of them
were sort of easier to see that
they were gonna cause changes.
Yep.
Right.
To me at the time, it was,
it was such a surprise.
Like the, the, the
big logo, right?
When I brought on big, big
national insurance company,
all of a sudden, like they were
dictating a lot of, I basically
had a boss at that point didn't
realize that I was, say the same
thing about investors, right?
Same concept.
So, so very similar
thing, right?
Like when, when the, you
know, we money comes in,
we celebrate the wire.
We forget that there's
strings attached.
Right?
Right, right.
So all of a sudden
those things change.
So if you go back in time and,
and think about some of these
things, what victory, right?
Victory.
I'm air quoting here.
For everybody that's just
listening and out watching
what victory, big customer,
big funding rounds, big
hiring, whatever it was quietly
cost you the most freedom.
Honestly, it was,
it was fundraising.
And, and, and I remember
the first time I got a
call from an investor where
I, I knew the purpose of
the call wasn't positive.
That's when it really
resonated with me.
Yeah.
That's, that's when I was like,
oh shit, I just hired a boss.
Yeah.
Um, and I celebrated it,
and it's exactly what
I was trying to avoid.
Yeah.
And because I wanted to be
bigger, which, you know, again,
I, I, I understood the goal.
I created this new cost that
I didn't really appreciate.
And I remember seeing
it on my phone.
I was seeing this person
calling in and being like,
they're about to give me
some shit that I wouldn't
have gotten five minutes ago.
Right, right.
And, and here we go.
I was like, man, the hell
did I even sign up for this.
The funny thing is I didn't
even need the money like that.
That was the funny thing,
not because we were so
wealthy, because the amount
of money we were raising
wasn't that significant.
And the reality is we only
did it because someone offered
to invest, not because we
actually needed the money.
And I was like, man, I was so
enamored with the idea that
someone was validating me that
it didn't occur to me like that
I shouldn't even be doing this.
Yeah.
Well, we get enamored.
It also, it can feel like a
good signal, and I think a
lot of founders fall into this
trap, both in terms of funding
and in terms of headcount.
People love to toss around it.
It's funny, I've started
playing this little, this
little game where people
would be like, yeah, and we
just screwed to 150 people.
And I'm kind about it, but
I'm my, my first, the first
thing I always say is like, ah,
condolences, how you feeling?
Right?
Not what they're
expecting, right?
Because they're
right sign of growth.
This is a sign of all
these good things.
They, they're, they're
not, they're not tracking
the other side of it.
I think for me, I noticed a
couple red flags that started to
be indicators of these things.
The canaries in the
coal mine, if you will.
One was like, the minute
I, I realized that we need
to have a meeting to decide
if we need a meeting.
Right?
That's a great one.
Right?
All of a sudden you're like, I
think we might be bigger than
we need to be if we have to
have a meeting about a meeting.
The minute I see anybody in our
team spending more time updating
dashboards than, yeah, than
than customers, it's a huge one.
The minute I'm learning
about product changes or
like really meaningful stuff
within the company on a slide.
Not in the hallway, not in
Slack, not just through like
normal course of conversation.
These are all things that are
just indicators to me that, uh,
we might be a little too big
for our britches at this point.
I think what was.
Really telling for me, uh,
this is around the staff size,
is when we let someone go and
we didn't replace them and
absolutely nothing happened.
Right.
And it was one of those
things where, yeah, when
the person is there, and
this could be, this is gonna
apply to lots of companies.
When the person is there and
they're doing their job, we
all just assume because they're
still there and they're still
showing up for work and they're
engaging with everybody, that,
that work must still need
to be done by, you know, a
full-time person, whatever.
Yeah.
Yeah.
And then they leave.
No one backfills them and no
one notices, nothing happens.
He's like, what the hell, man?
And mind
you, how we've been playing
without a left back, I dunno.
We're still winning games.
Right?
So I think, let's
start with this.
So the, the premise here being
that we've got all of these
hidden costs, we're scrambling
to, to incur these costs, but no
one stops and says, should we?
Now there's another
side to this.
Which is, I don't think I
could name 10% of founders
right now, Ryan, that could
tell me right off the top
of their head, tell me why.
What makes your company better?
Not bigger, right?
People say I'm more staff,
more revenue, whatever.
What makes your company better?
Yeah.
I think the definition around
that is gonna be soft for
just about everybody we know.
Unbelievable.
If, if you asked us my, uh,
we've even podcasted about this,
my first answer is freedom.
That's what makes us better.
The more freedom we
get@startups.com, the
better a company we are.
Right?
And yes, it's been wild to
watch how that manifests, Ryan,
because, like through this
company, like in the time that
you know, that you and I have
been building together and,
and doing things together,
uh, we've become parents.
So, uh, you know, the freedom
to be parents has been
paramount for us, but we've
also had, in our culture,
as we've created a remote
culture, I think we've created
more freedom for our staff.
A hundred percent,
like more independence.
Anybody would
disagree with that?
Yep.
And I think we take it for
granted, but when folks come
to work here and they're like,
wait, I, I'm on my own schedule.
Yeah.
Let's just check and
do your job, right?
Hmm.
Right.
Right.
What, what I'm saying is
like, for us, that's better.
But I think when people come
from another culture and they
come here and and see how
important freedom was to us,
independence was to us and they
get to enjoy what that means.
Their heads explode.
Yeah.
They're like, holy shit.
Like this is, this
is incredible.
But my point is it's because
we invested in better.
It's because we said
freedom is is better for us.
Yeah.
So we do more things
that make us more free.
Ergo no investors.
Yeah.
And unfortunately I think
that, that, that takes a
very different level of, of
introspection and, and planning
and conversation because, you
know, we typically plan for.
Bigger with a
spreadsheet, right?
Like it's, there's some version
of, of a model that we're
gonna be like, here's how way
we're gonna, we're gonna scale
this, we're gonna do this.
But you can't really plan for
better in the same way, right?
Better, better takes a
narrative, better takes some,
some honesty, better takes.
Time and, and, and a different
level of introspection and,
and discussion, I think.
And I think that's,
that's tough.
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.
Ryan, you know what took for me?
Guilt was my issue.
It took me being
willing to be guilty.
Yeah.
Uh, and, and here's,
here's how that manifested.
When I think about, Hey, this
company needs to grow, I am
instantly, this is my default
programming saying it should
grow at the, at any cost to me.
At any cost to me.
Right.
So going back to the agency
days, and I'm sure you dealt
with this too, it was like,
oh, we need to sign a client
and I need to be halfway across
the country all the time.
At the time you and I were
single, so it didn't matter.
Yeah, right.
But now with kids, yeah.
Basically what we're saying
is if, if I fly across the
country to sign that client
and I know I'm gonna have
to be on site, whatever, I'm
gonna see less of my children.
My work guilt would
say, yep, sounds right
for the record.
Guilt is a terrible
Chief operating officer.
Right.
You never want to hire
guilt as the Chief operating
officer, but Right, right.
It is the default
operating officer.
Right.
That's the
problem.
Correct.
Right.
Yeah.
And, and, and I would look
at it and I would say, oh,
uh, you know, again, this
is, uh, you know, former me,
wall Street didn't have kids.
This time I would've
been like, oh, well, I
guess we need to grow.
I guess we need this client.
Yeah.
So I guess I'll just
see less of my kid.
Yeah.
Now I'm saying that
specifically, you know, back
then as, as the, the founder
and CEO of that company.
I'm also saying it for
everybody that works with me.
Right.
It's like, Hey, we got this new
account and everybody's high
fiving and, and like, imagine
if I just said this straight up.
We just signed on this new
account that will all of a
sudden create a liability on
payroll where we'll be like
disproportionately indebted, uh,
to that one particular client.
Yeah.
Yeah.
All of you can look at your,
your kids and your spouses and.
Uh, chalk off about 30%
of the quality time you've
ever spent with them.
Uh, we'll also be increasing
everybody's stress level
and likely not compensating
you for any of it.
Mention that announcement.
Not to worry.
We've pre-ordered birthday
and Christmas gifts for your
children and your wives because
you won't be seeing them.
So it's okay.
But that's not the
message, right?
The narrative is we
sign this big client
bigger, better, right?
Yeah.
But the cost to everybody
involved is absolutely, um,
something that everybody has
to bear, including, you know,
us as the, the founders.
Yeah.
But we never really
talk about it.
We don't And it's a miss.
It is.
It is.
But, and I think there's
a reason for it, and I
think that's because the,
the cost of growth can
show up on the p and l.
Yeah.
Right.
If we, if we fail to do
things to become bigger,
to, to, to stop growing,
to, to make those decisions
take on that big client.
The cost of growth
doesn't, it does get
reflected in the p and l.
The cost of regret does not,
but it sure is shit compounds.
Right.
Right.
And so as I think that,
that's the trade off that
we make, we go like, yeah,
but you know, we only need
to grow a little bit more.
And once we're done with
that, then we'll go back
to seeing our family, then
we'll go back to Right.
And so I, I think that, you
know, we've talked about
this before, will, but
one of the things that we
provide on, on this, this
podcast is, is permission.
And so, you know, here's
me, probably you as well,
granting people permission
to optimize for founder life
design on purpose, right?
Yeah.
That's the whole rest
of you, the point you're
starting a startup.
Yeah.
Yeah.
It, it's supposed to be, right?
And yet it just, it's so
often is not the way it goes.
It's
easily lost that, that's
the whole point, right?
Yeah.
And so we're sitting here
going, here's what would make
us bigger, uh, more staff,
more office, whatever, right?
More capital, whatever.
At which point we say, well,
what would make this company
better for the people who
actually work here incidentally,
none of those things.
None of those things that
we're about to do and
kill ourselves to do Yep.
Will actually make things
better for anyone involved.
Okay.
Yep.
So for example, I'm
like, Hey, we're gonna
add a hundred people.
Okay?
Like I get it, it on in the
p and l, having been a CFO
for 25 years, I understand
exactly how that benefits.
The company.
Yeah.
Okay.
But if you're the founder, if
you're the, the, the people
that are responsible for
making payroll for all of
these people, your life just
got a hundred times worse.
Right?
There's no version of adding
a hundred people where
your life gets better.
You have a hundred new problems.
You've just added, you've got
a massive amount of monthly
liability in kind of, you
know, funding all of that.
Also, by the way, if you're
a funded startup that's
swinging vine to vine on
funding rounds, you are
well aware of this problem.
Okay?
And then the other issue is that
now all of the, the reporting
and all the things that you
have to do in order to operate
a company are far more complex.
You just jumped in mud and
you're trying to sprint and
you're thinking to yourself,
this is gonna be awesome.
No, it's not.
It's actually not, then you're
surprised when it's not awesome.
Right?
Oh my God, this is so shitty.
Yeah, no kidding.
Uh, you didn't
optimize for better.
Yeah.
But again, I think that's,
that goes back to just
making sure that we got a
clear definition of, of,
of what that actually is.
Right?
Right.
And you, you talked about
some of 'em, and I think there
are some that are, that are
kind of non-negotiables and
I think people understand it,
but they don't all have to be.
So I want, I wanna be careful
here because a lot of this
stuff that we've talked about
is like freedom and you know,
time and yes, but better is
also things like profitability.
Oh yeah.
Versus net promot
score promoter.
Yeah, of course.
Right.
All those things.
So it isn't, this isn't
just about sacrificing
because, because better
doesn't just mean easier or
convenient or nice to run.
Right.
It means truly a,
a better business.
Right.
Right.
And so I, I think I'm
forming a framework in my
head here and I'm trying.
Okay.
It's, it's BB, b
better before bigger.
So let's go.
So here's how it works.
I want to define a couple
of non-negotiables,
like whatever those are.
Like pick two or three.
Yeah.
That, that, you know, that
these are the things like
it's two days without meetings
greater than 20% EBITDA and
maintaining co company culture.
That last one I don't love.
'cause it's, that's, that's
harder to see and kind of
harder to, to, to, to manage.
Yeah.
But then anytime we're
making a decision, right?
Does this hire,
does this customer.
Does it increase or
decrease those things?
Yeah.
Here, here's a
great example, Ryan.
Let's say you added 50
people to the marketing team.
Yeah.
Do you like your job more
because you're not gonna
do marketing anymore?
How many of them play soccer?
And our blue belts are
higher in Juujitsu.
Right.
'cause that will significantly
change my answer because at 50
people, I can get almost a mini
league going at that point.
That'd be fantastic.
Other than that,
I would hate it.
In which case there
would be so much more
efficient ways to do that.
Yeah.
Like just go literally any
yard, the soccer fields
that are a mile north of
here probably would be an
easier, easier thing to do.
Exactly.
But, but play that out.
Like we're saying, Hey,
we're gonna add more people.
Do any of us want the
job that comes with
adding all those people?
Maybe.
Maybe you really, really enjoy
managing and not doing any work.
Now people hear that.
They're like, oh, how
dare you say that.
Managing is work.
It is okay, but it's
a different work.
Right.
One of the things, and again,
not everybody understands kind
of the, the composition or how
we, how we operate@startups.com,
but one of the core tenets we've
had at this business since day
one is we say that every gen
general carries a gun, right?
Yes.
It has nothing to do with
our free toting gun rights.
Uh, what it means is
that everyone goes
to war here, right?
Like nobody sits back and just
like kind of calls, shots.
Everybody is, there
is no balcony.
There's only dance floor.
Correct.
Everybody is in the mix, right?
Everybody's on the front
lines, and we say that
because it's what we enjoy.
Yeah.
Like I sit down every
Monday and, and I try to
come up with whatever the
topic is gonna be for this.
Right.
You know, for, for the,
the shows and our, our
content and stuff like that.
And I sit down and I
write all the words.
Right.
Yep.
Now other companies eventually
have like copywriters that
do that, or they outsource
those things or whatever.
Yeah.
Yeah.
And you know, as the CEO,
there's a ton of things
that I do that normally
people give to someone else.
Right.
I'm also our CFO.
Yeah.
I literally do our
finances right.
You know, like a lot of
people wouldn't think that,
oh, you hire that out.
I enjoy that work.
I don't want it taken from
me.
And I think it goes beyond that.
So the enjoyment part of it.
A hundred percent,
and I'm glad for that.
But I think the other side
of that is that when we
start to scale without soul,
it's just size and then it
eventually just falls apart.
This is where the, the
quality starts to flag, right?
So yeah, we could have sourced
that out to somebody else,
but somebody who hasn't lived
as a founder, a across 30
years and, and nine startups,
they're not going to write the
same content that you write.
We're not going to have.
The same podcast that we have.
Right.
Right.
And so that's, you know,
while it seems like a funny
little example of sitting
down and writing an article
on Monday, it's a pure
encapsulation of exactly what
we're talking about here.
Right, right.
The minute that scales and
we go for efficiency over
efficacy, one of my favorite
things to talk about in all of
startup land, we start to lose.
Right?
Right.
We, we've now created a very
efficient way to make something
that maybe it doesn't suck, but
it's not as awesome as it was.
And that's, that's,
that's the path to shitty.
And I don't wanna be
on the path to shitty.
I agree.
Let's build on that.
If there's a version of
startups.com that's 10 times
bigger, uh, revenue, et cetera,
but it comes at the cost of all
the things that we love, our
freedom, our culture, whatever.
I just don't wanna
work at that company.
Uh, right.
And, and, and we've had this
conversation 'cause I have
worked at that company before.
Yeah.
Right.
So have I. And I
just didn't like it.
And, and again, there was
a version where I hit kind
of, um, a crossroads in my,
in my life, in my career.
This is again, my late twenties
as, as that company was growing.
Yep.
And it was like, I can stop here
like chapter save point, right.
And go do something else that
I actually enjoy or I can
stay here and we're gonna go
public and we're gonna go run
a company and it's gonna be
multi-billion dollar company.
And I chose to start.
From scratch, which a lot of
people would not choose to do.
Right.
A lot of people would be
like, no, you have something
successful, you just go do that.
And at a young age, the tender
age of 27, I raised my hand and
said, but I'm not having fun.
Yeah.
Right.
Now that was an
expensive decision.
Uh, I did okay, but I
could've done a lot more.
Okay.
You know, had I, you know,
stuck with the IPO, but I
wanna point this out, I chose
quality, I chose better.
Yes.
This is cool.
I'm proud of what we've
done, but I'm out.
And I went and go
did something else.
And I was very proud
of that decision.
I, I've never looked
back a single day, this
is like 25 years ago.
Yeah.
I've never looked back a single
day and said, man, I really
wish I, I went for, should have
stuck with that.
Yeah.
Yeah.
Not even once, like, not even
1% be the operative word.
Right.
And my wife and I talk about
it and, you know, Sarah's so
pragmatic and even she's like.
I know you so well.
There is no version where
you would've survived.
Your mental state would've
never survived in being
part of Big Corp. Right?
Like me on a, a quarterly
earnings call with
analysts talking about the
state of the healthcare
advertising market at scale.
Like literally.
You trying to an
eighties movie reference
into that gets harder every
year, you know, like it's
not going well.
But, but again, uh,
and, and again, I'm, I'm
proud of that business.
But, but at the same time,
I wanted no part of it.
It literally, like, we went
the growth path and I looked
at that and I said, man.
I don't enjoy that.
I like working in
small, nimble teams.
I like working in
the mix on products.
I don't like, you know,
uh, just set telling other
people how to build products.
Like I wanna be in there.
You've known me for a long time.
You know that when it comes
to the product, the stuff
that you see on startups.com,
I probably wrote the copy.
I probably designed
that landing page.
Yeah.
I probably like, I
am very in the mix.
You're in it.
Yep.
Yeah.
And, and I say that and
I'm very proud of that.
And I know that there's
a version where it's
holding us back from maybe
getting bigger, maybe.
And I don't care.
And I don't, I don't mean that
like, uh, like in a callous way.
I mean No, no, because I believe
we've optimized for quality,
quality E exactly that, right?
So we're, we're trying to,
'cause you can, you can
make things louder, right?
We're trying to go less
noise, more signal.
Um, you know, we're, we're
trying to not, you know, grow
talent volume, but trying to
increase talent density and, you
know, we're looking at the, the
various scaling levers because
I think, you know, there you
can just add more and more and
more and more customers, right?
But you can also do
things like raise pricing.
You can narrow your ICP, right?
It was counterintuitive,
but like you, you start
to focus in more and you
start to move faster.
Within that ICP you can deepen
product for core users, which
is very different than saying,
let's add one more feature,
let's add this, let's go
broader and broader and broader.
So we start to soak up more
and more of the vanilla market.
Right?
Um, because to some
degree saying no is a
growth strategy, right?
Yeah.
Agree.
When we trans skews
cut features, kill the
almost customers and
really just focus on.
Where we can drive the most
quality that is growth.
And that's, that's not
just growth, but it's
the type of growth that
you won't suffer from.
Yeah.
I'm actually, again, if
I take a look at, at the,
the, uh, the life path, if
you will, of startups.com.
I'm very proud of a lot of
the decisions we've made
when we've stuck to our guns.
Yeah.
We've had many opportunities
where we could have shifted
course and grown differently.
We could, we could have
added staff differently, we
could have raised capital
differently, et cetera.
And I think about how
many of those things
we are not beholden to.
Yeah.
Even simple things like
we never really created
any debt for the company.
Right.
It's just something we didn't
want hanging over our head.
Right.
We don't have a single
debt payment to service.
That's powerful.
I mean, that, that
is a decision, right?
Of, of quality, of life.
Yes, we could get bigger if we
took on a whole bunch of debt
or capital, et cetera, and I
thought, ah, you know what?
We could just don't want it.
Like, it, it would not
make our lives better.
And, and I'm, I'm
proud of standing firm
on those decisions.
And I gotta tell you what,
if I look back, like on,
you know, 30 years of, of
building companies, right?
I can't think of a
single case where.
I optimize for quality of
life, like, you know, quality
of life in a lot of ways.
Right?
And I regret it.
I've never looked back and
said like, yeah, oh shit.
I, I, I really wish I'd
put myself in a, a more
leveraged position ever.
I think this is one of those
things where this sounds like
kind of a, a lofty conversation,
like this very high sy I wanna
point out that it's not right.
The, the, the reason that we
have been able to maintain this.
Yes, there were some very big
decisions that were made or,
or things that we said, big
things that we said no to, but
it was as much a collection
of the, the, the small things.
'cause I think that's,
again, it, it's death
by a thousand cuts.
You, you let one little thing
go, another little thing,
go another little thing, go.
Pretty soon you've got a, a
metric ton of those little
things that are, that are
now weighing you down.
And so it was, it was
simple little stuff.
It's saying no to a
customer category, right?
It was going to our sales team
and saying, Hey, going forward
when clients present this way.
They're not great fits for
what we're doing, right.
They're not gonna get
what they want from us.
We're not going to be
able to satisfy them.
It's gonna end poorly,
let's say no to that.
Right?
And, and of course sales
team's gonna come back and
say, but that's revenue.
And we're gonna go,
yeah, but it, it costs
us more than it makes us.
And so it's little decisions
like that which seem, you
know, not that they're
inconsequential, but
these aren't things like.
We're going to completely
change company culture or
we're we are going to go raise
funds or we're going to not
raise funds, which are big,
big, big decisions, right?
Something as small as saying,
you know, we're gonna say no
to this particular type of
client in the future doesn't
seem that big, but these are
the little decisions that stack
up into quality over just pure
size and keep founders sane
and happy through the process.
It snowballs
both directions.
It snowballs like you're saying,
when you make a decision like,
uh, that goes against your,
your values or your goals or
you know, what makes you better.
And it snowballs when
you're willing to pony
up and say, fuck it.
I understand this would make
us bigger in some way, you
know, and maybe more money,
but I just don't want to do it.
Great example, for those of
you that have been listening to
this show for a very long time.
Ryan, how many
episodes do we have?
At least 300.
This is, uh, we are currently
recording three 18 or 19.
Damn.
Okay.
So the fact that I don't
even know, it's a hell
of a lot of episodes.
Yeah.
Fun fact for everybody.
How many guests have
we had on this show?
How many guests have
we, I think two.
Okay, so, so if we only
here back the archives.
I was here, we
brought in a guest while
I was out once and then
I've never left again.
Yeah.
So, uh, in the early, early
days, and this was good advice,
it was sound advice, uh, people
would say to us, in order
to make your show bigger.
You need to have guests.
You gotta have guests.
Yep.
Gotta have guests.
And, and they're right.
It's actually,
it's entirely true.
Right.
It's a massive growth
strategy for podcasts.
So I remember years ago,
in the early days, we
brought on Steve Blank.
Remember when we
had Steve on Right.
Very well known
entrepreneur, I remember.
Yes.
Yeah.
And Steve had a show where he
let us talk from time to time
and, and, and we were allowed
to chime in on Steve's show
that, that, uh, that we hosted.
Yep.
And it went horrib.
And ho most words I said in that
was, was in the outro
that I recorded separately
after the episode was over.
That was the most, I
talked in the entire,
and, and so, and we
had great guests.
I remember we had,
um, Sam Parr, right?
You know, Sam's actually,
you know, gone on to
create a wildly successful,
uh, podcasting career.
And we got on and Sam's a
great guy and clearly he's
a, he's a great guest, but
it didn't feel like our show.
It.
It felt like a guest
on someone else's show.
And so we made a decision
300 episodes ago, right?
That we weren't
gonna have guests.
And I'm sure it cost us
a gazillion views and
followers, et cetera.
But guess what?
We don't like that show.
We don't like that show.
We don't like a show.
We like this show a lot.
What's that?
I said, we like this show a lot.
We like this show a lot.
Like, like the, the reason
this show doesn't have guests,
and by the way, Ryan, how
many emails do we get per day
of people pitching a guest?
We might get more email pitches.
Five and seven for our show.
Yeah.
Than we even have listeners.
Yeah.
Right.
It's
unbelievable.
They all
pretend that they listen
to the podcast though.
'cause they'll, they'll, yeah.
Maybe those AI generated
reference about, you know.
Whatever.
I love it when
those go wrong too.
Right, right.
The episode you guys did
talking about the, the
price of insulin and you're
like, we've never done an
episode talking about the
price.
Yeah.
I was like, shoot, I
love to listen, uh,
hear about that episode.
Anyway.
The point is we made a
decision for quality.
The quality.
This is the show that
Ryan and I want to do.
What, what you're hearing.
Our show has no strategy to it.
And, and when I say that
I'm, I'm being callous.
It's not that we don't think
that like, you know, founders
will, will listen to what we
do and maybe you want to use
startups.com that has, you
know, some commercial purpose.
If that's all we were optimizing
for, if we were going purely
for growth, this would be
a way different podcast.
Right.
This is the podcast
is what it is.
'cause what Ryan and I
enjoy doing, we just like
enjoy getting on here and
just like bullshitting
about whatever topic.
And we know it's
useful to founders.
We know it's
helpful to founders.
Right.
Is it, is it the, is it the
fastest moving marketing engine?
No, but that's not
what we tried to build.
We tried to build something
that would be intimate.
Useful for founders and
that was all Exactly.
And I think that leverage,
if that we have over our
own decisions where we
say, yes, this could be
bigger, but it's not us.
Like it, it, it would
reduce our quality.
Yes, we could scale faster
if we raised a whole bunch of
money, but we wouldn't wanna
wake up in the morning and,
and have to worry about the
phone call that we're getting.
Like there's a lot of things
we could do, and I'm not
saying we hate growth.
We love growth, but we love
growth on our own terms.
And I think for a lot of people
that are out there when they're
thinking about getting bigger,
it's not about getting bigger,
it's about getting better
and getting better is about
sticking to what your terms
are and making that decision.
Every single day that the
most important thing is what's
gonna make you the best company
possible and a better, uh,
person and founder in sticking
to that the entire way in
saying, this is who we are.
This is what we do in
making no exceptions ever.
Overthinking your startup
because you're going it alone.
You don't have to, and honestly,
you shouldn't because instead,
you can learn directly from
peers who've been in your shoes.
Connect with bootstrap
founders and the advisors
helping them win in the
startups.com community.
Check out the startups.com
community@www.startups.com
to see if it's for you.
Could be just the
thing you need.
I hope to see you inside.