Welcome back to the episode of the Startup Therapy Podcast.
This is Ryan Rutan, joined as always by Will Schroeder,
my friend, the founder, and CEO of startups.com.
Will, we've podcasts about this before.
In the past and, and historically, you know, the,
the mantra in, in startups was very much like that
of real estate, which was location, location, location.
Right?
It used to, yeah, used to seem to matter a lot, particularly
if you wanted to get funded and what was it now, almost 10
years ago, you packed up the family and moved across country.
In order to be at the epicenter of the startup
world in in California and.
How'd that work out and like, what would you do
differently this time?
Would you still do it now, like 10 years later?
You know what's awesome?
I wouldn't have to, I, yeah.
You know, I was, I was having a conversation with, uh, with
the founder last week and she was talking about she wanted
to move to California, San Francisco specifically, you
know, she said, Hey, you know, that's where the capitalist.
And uh, and I said, well, you know, I've done that myself.
I've, I, I moved my family specifically out to San
Francisco, uh, to be closer to everything, you know, et cetera.
This is.
But as I was explaining it to her, I was starting to think,
you know, some of this stuff actually doesn't apply as much.
'cause yeah, when I moved out there, I moved out to,
lemme get my dates right.
I moved out to, to, uh, Los Angeles, to
Santa Monica in 2006.
And then, uh, later on I'm make up my dates.
2009, I guess 2010 went to San Francisco and
then, then back to la.
Doesn't matter.
Point is I, was there a long time.
Yep.
And it was.
A very expensive move.
And I don't just mean financially, I mean just
like lifestyle wise.
You know, my, my family, all my friends, you, everybody else
was in Columbus at the time.
Yeah, yeah.
And moving was, was a huge commitment.
But at the time, all the things you needed were there
specifically the talent, the money, the, you know,
uh, the infrastructure.
Everything else was there.
And so you kind of had to make the pilgrimage.
But as I'm explaining it to her, I keep saying to
myself, well, you know.
That actually doesn't apply anymore.
Wait, no.
That actually doesn't apply anymore either.
And after a while I was like.
I don't think you really need to move.
Yeah.
It's, it's crazy.
But I mean, think about all the things that have happened
since then from a global pandemic that, that made the
already, uh, fairly strong push towards remote work just become
a thing for, for everybody.
The fact that we're all essentially now Zoom natives,
like right, where, you know, we're, we're doing
stuff like this on a, on a, a, you know, daily basis,
multiple times a day.
Where it no longer feels weird, we're more socially
connected via the, the networks that we use online
than we ever were before.
Yep.
And so the, I mean, even, even just in, since the time that
you and I did this, another version of this podcast
previously, things have changed again, like significantly
unbelievable.
And so I thought it was worth revisiting because I, you know,
incidentally wound up revisiting it without even realizing it.
It was really interesting because I wasn't even trying to
make the case for not moving.
I was making the opposite case.
Right?
Yeah.
So I was trying to state it.
I just like kept correcting myself going,
you know, well actually,
yeah,
yeah, yeah.
But actually, so I think we look at three reasons.
Three, three categories.
Okay.
That startups move.
They move for, because they wanna be where
the talent is, right?
Yep.
Which, you know, was always valid.
They move because if, if they're raising, because they wanna
be where the investors are, and that's pretty specific.
And then the third is they wanna network, they, they
wanna be around other people and, you know, grow their
networks in the zeitgeist.
Yeah.
And it's just, what was really interesting is as I looked
at those three, like seminal reasons, you pack your shit and
go, I was like, damn, there's no way I would do that now.
And it was a great experience.
So I'm not looking at it like, oh my God, it was terrible.
It's amazing.
I, you know, I got, I raised money from investors.
I hired tons of people.
I, I built a huge network.
Like, uh, I did all the things, but if I had to do it over again
right now, probably wouldn't.
Yeah.
I think there's a difference between being a good
experience and it being a, a necessary thing.
I think we talked to so many founders who are
like, I have to go do this.
I don't want to, but I have to.
And I think that that's just, that's, that's
something that we will.
Probably end up dispelling in the next 30 to 45 minutes.
Yeah.
You know, and, and I, I posted this, uh, yeah.
After I had that conversation, I posted this on Reddit.
Right.
And I, Reddit always fascinates me because
nobody's happy on Reddit.
So if, if I wanna make sure everybody, like I can get
a complaint from everybody, I post it on Reddit.
Yeah.
It's good place.
And so I posted on Reddit and I, I think I was a
little more specific.
I said, is it still worth moving to San Francisco?
And I wanted to make it specific to San Francisco
so I didn't get everybody defending their, their city.
Right.
And, uh, mixed results.
You know, some people were still adamant like, if you're
gonna build a big company, it has to be in San Francisco.
And other folks were, I saw some of that conversation though, and
like at least one or two of the people were like, yes, you
have to move to San Francisco.
And then when you look at their location like.
That's not where they were though.
So like they're telling you you have to go do this,
but they haven't done this.
They're not doing this.
Like, okay, come
on.
I love Reddit.
'cause it's a mixed bag.
You know, it's just a different version of social media.
And uh, I posted it there again because I knew people
would have strong opinions.
Right on.
Like, if you're on Twitter, if you're on LinkedIn, you
tend to follow people's opinions that you like.
You know, if you're a Democrat, you follow
Democrats, you're Republican, you follow Republicans.
But on Reddit, they just tend to throw everybody in the same room
and you kind of get everything.
So to your point, what was interesting about
the conversation, it was a pretty lively one.
There are still people that genuinely believe that, like,
again, this is San Francisco, but I'm using that as a proxy
that believe if, if you're gonna build a meaningful company,
it's still in San Francisco.
And there's data to support that.
I, I, I, I think it's a little bit, I dunno how causal it is.
It's, you know, the biggest companies are in San Francisco.
Oh, maybe.
Maybe the, the best entrepreneurs end up moving
there and build them there.
It doesn't mean that they couldn't have
built them elsewhere.
It just means they didn't.
I think it becomes a self-fulfilling
prophecy at some point.
If everybody thinks they have to go there to build,
so that everyone goes there to build, then by nature
of everyone building there,
that's where it's gonna happen.
Right?
Yeah.
It's kind of hard to avoid.
The second part that nobody talks about is yes, that's
also where people go to fail.
Yeah.
Like far more of them fail in San Francisco
than anywhere else also.
Yeah.
And so, uh,
look, this isn't a everyone versus San Francisco thing.
I just thought that was an interesting, you
know, single data point.
But what was interesting is I feel like if I had posted
that four or five years ago, the number of folks that
said, you've gotta be in sf.
Would be much stronger.
I mean, again, I moved there, so I, I, I clearly like, you
know, believed in that thesis.
I just don't believe in it the way I used to.
Not knocking sf it's a great city.
I'm just saying the world has changed.
So let's talk about it.
Sure.
Let's talk about first I wanna get to investors
second, if you don't mind.
I, because that's fine.
Not everybody's raising, but when people are like, hey,
like you know, I need to move 'cause I need access to talent.
Forget SF for a second.
Yeah.
I need to move.
'cause access to talent.
I think you opened it up.
I think remote work.
Put a bullet in that because we're not centralized anymore.
It did.
Yeah, so I think the, the idea that you need to be in
a place, in fact it, it's at this point, like I think five
or six years ago, we could have said like maybe we're
pretty close to that line.
Three or four years ago.
I think we could have said like, yeah, it probably
doesn't matter right now.
I think it actually matters, but in the opposite direction,
which is to say that if you were to try to go somewhere and say
you have to come into an office.
Look at how that's going for a lot of companies right now.
So it, it can actually work against you if you
move somewhere specifically to gather humans.
And that kind of doesn't matter where it is at this point,
San Francisco or otherwise, you're gonna struggle.
Right?
Right.
It's just not what people want.
It's no longer like, there was a point at which it
was, it was sort of a benefit or, or a, a perk.
Remember when we, when did we start doing this?
Will?
2014? Yeah.
2012. Was it that far back work from home Wednesday?
Yep.
Oh, oh.
Work
from a Wednesday.
Yeah, yeah, yeah.
That was 2014.
2014 work from home Wednesday.
Right.
Which then expanded to work from home Wednesday, Friday,
which then expanded to Monday, Wednesday, Friday.
So by the time the pandemic hit, we were in the
office two days and Yeah.
Right.
It had already gone.
You know, you and I talk about this a lot, but yeah.
The minute you make something a, a benefit or
a perk for, for people, it very quickly becomes the
baseline and the expectation.
Now it's just an entitlement.
And like that's everybody.
Now everybody's in that same boat where it's like,
I just remote is what?
What do you mean in person?
Well, I think it, it's a few things.
Number one, like Covid broke the seal, right?
Yeah.
A hundred percent.
Covid basically said, look, the whole world
literally can work remote.
Like you can't make an argument that it can't be done.
Now you can make an argument and, and plenty of my, my
smart friends have that said, I just prefer to have
everyone in the office.
I get that.
Like, I, I, yeah, the argument's valid.
I'm not saying there isn't a version where having
people in the office is.
Bad.
Right?
I am.
I'm, I'm saying that, but it's a preference at this.
It's a preference.
You, you don't,
I prefer to have people in the office.
Yeah.
Before it was table stakes.
We had an office like everyone else.
Yeah.
Even though we were only going to it two days a week, days a
week, still paid the same amount for the damn office, right?
Yep.
And because of that, there was an expectation that if
our office was in Columbus, then our team was in Columbus.
And now.
Like it doesn't even occur to me to hire someone in Columbus.
Not being anti Columbus, I'm just saying No, it
just doesn't matter.
Right, right.
You don't have to think parochial.
That went away completely.
Yeah.
I'm not gonna see them either way.
Right.
Yeah.
They're gonna be wherever they can be and it doesn't
work for every company.
I get all that.
Sure.
But, but every company usually, you know, founders
making these decisions are usually sub 50 people, if
not just the only person.
And if we're talking about the ability to attract talent,
let's say for the first.
10 to 20 to 30 people.
Okay, so we don't get into this like scaling thing.
I have a hard time believing you can't build a 30 person
distributed team anywhere.
Yeah.
I, I think it's, it's actually even easier.
I think that some of the challenges with the
distributed team come when you surpass that point.
When you're at 50 Yeah.
To a hundred, 150.
There's a point at which now making a consistent
company culture becomes a little bit more difficult.
Absolutely.
But I would argue, yeah, at the, at the early stages,
it's, it's far easier.
You know what else is easier from a talent perspective,
if you have the money, you're not spending on San
Francisco rent to hire them.
Right, right.
Turns out people like the cash, they, they weren't paid
more than, like, it'd be cool to hang out in your, your San
Francisco office and get paid half of what I could pay if
you weren't paying that rent.
Or just the other side of it is a lot of the people
that were in San Francisco didn't wanna be there.
And again, I'm not picking on San Francisco, take New York,
take any, any big high price city for a very long time.
You had to be in that city in order to to, to
get those opportunities.
And Covid really just changed all of that.
I mean, COVID was awful, but the one positive that came
out of it is it made us say.
Wait a minute.
I wanna live in Columbus, Ohio, but basically do
a New York City job.
Now you can, no surprises there.
But what I'm saying is a lot of the talent that before
you couldn't get access to.
Yeah.
Because they had expected to stay kind of
parochial to their city.
A lot of those people went home.
Right.
A lot of those people went back to where they came from,
either to raise families or just to to live, you know,
uh, without 14 roommates.
And I think that goes for miles.
You did it.
We did.
Yep.
We, we've, we've moved quite a bit since the, uh, since
the inception of the business.
But, um, I think that point is, is extremely valid,
which is that before there was sort of a, a, a fence
around some of that talent.
Yeah.
And I think at this point that fence is absolutely gone.
And it was driven by the talent, right.
Like they said like, Hey, we don't wanna be corralled here
anymore than anybody else does.
We saw it like, I saw it actually.
So if you remember the, the condo that I owned in Columbus,
I sold to a San Franciscan.
Yeah, it wanted to come back to the Midwest after having
been out there and, and built a startup for a couple of years.
Sold my, uh, house in, in Florida after we left
to somebody leaving, uh, the Bay Area.
It wasn't San Francisco, but the Bay Area, uh, that wanted
to get outta there and, and, and buy something somewhere
else, like we saw a massive amount of diaspora after it
became possible, like the minute it became possible,
people started moving around.
It's, it's so funny because everyone plays
the same Zillow game.
Yeah.
Like we were living in San Francisco and we were, we
were looking, we were, we were in an apartment at the
time and we were looking for a, a home somewhere like
in Palo Alto and, you know, the home price of bananas.
And then you take what you were gonna spend and ather
in, or where the hell you were gonna go, and then
you plug it into any other city you could live in.
Right?
Yep.
And it's, it's like you have mansion by comparison.
And we did the same when we moved to Los Angeles.
You know, we ended up finding a home in Beverly
Hills, which wasn't our first choice, but that's
just kind where we landed.
And then we started looking at, 'cause uh, you know, uh,
will, my son was born, we had to find more room and we
started looking at other homes.
More expensive.
Then we took that same price and we looked at you.
Well,
we get anywhere else.
What would that do?
Somewhere else?
Yeah, anywhere else.
Probably
when you're there, you feel so poor, right?
No matter how well you've done, you feel so poor.
Right?
And it doesn't occur to you like, um, you
forget after a while.
Like what that money could buy anywhere else,
or more importantly, you don't need that much money
to live like, like what?
That life doesn't cost that much.
It only costs that much right here.
And I think people figure that out quickly.
And so I think that that's, it's been nice for people to
be able to decouple themselves from kind of like the life they
want and, and the job they want and, and then not having to have
those two things magically line up because they often don't,
um, or they don't, as life circumstances change, right.
Like when it was just, I. You and Sarah, you know, being,
uh, you know, being in, in California was fantastic.
Like the minute you add two more humans, you need
to add at least one more, if not two more bedrooms.
Yep.
All of a sudden it's like, okay, big difference.
This is where we want to be based on what it would
actually cost us to do this.
And yeah, unfortunately, like when that used to be hard coded,
hardwired to the type of work you wanted to do, you didn't
really have much of a choice.
So you, you had to then choose between life and work.
Yep.
Which, look, you know, I, you and I both love what we do
and so like life is kind of work for us, but also like.
Work is supposed to serve life.
Yeah.
Right.
And so at the minute when you have to start making
trade-offs between the two, the calculus gets really ugly.
Yeah, it does.
And, and you know, the other side of it though, is again,
moving to a city for talent, we happen to be entering into an
era where a lot of us don't need as much talent, you know, with
the advent of ai, et cetera.
So the idea of scaling up the way it used to mean I
raise lots of money and hire lots of bodies, that that's
how you build companies.
Yep.
And now it's like, is it.
I mean, low code, does it have to be no code
AI fractional hire on demand service, right?
Yeah.
Man, there's so many other ways to solve those problems.
Yeah.
And then, you know, I, I heard a quip that I've heard
a million times on that Reddit and that subreddit,
which was, look, if you wanna build a big company, you,
you have to go to a big city.
Right?
Because, you know, all the big companies are in big cities.
And it's like, look, I get that.
But do you wanna build a big company?
Yeah.
I mean, like, if you look at it in today's terms, one, if you
have a thousand people, what the fuck are they doing all day?
Right, right.
Seriously.
Like, I mean, this is a dumb example and it, it's probably
works against me, but I thought it was hilarious.
Like the, the, the, the event, not the outcome.
When Elon Musk went into Twitter.
And he fired 90% of the staff.
Yeah.
And that was years ago.
And Twitter is still, is around.
And again, I, I don't want anybody to lose their job.
So this isn't like, it's not that.
No.
It's just like, hold on a sec. He did get rid
of 90% of the staff.
90% of people.
Yeah.
And the company's still around like.
Nothing changed.
Seriously.
What were they doing
all day?
Part of it is predicated on the fact that like people
have also set their, their sights on these really wild
and crazy outcomes, which you and I have talked about.
Like, like you don't have to sell a company for a
billion dollars to have a really good lifestyle.
And as you reduce things like staff counts and costs, you
also don't have to build nearly as big of a business to just
cash flow really well and, and build a stable business and
really enjoy the hell out of it.
That's okay.
Right.
And if you do all this cost baked in, then you kind of
have to build a big business to get to the point where you can
extract as much money from it.
But if you don't need to do those two things,
then just don't.
Right?
Right.
Just build a good business that puts cash in your pocket,
pay your teams well, and then subscribe to the AI services
you need to get it all done.
Well, so which, which brings us to the next category,
which is investors.
I wanna be clear, I have not seen the same stratification
or diversification of investors by location that
I've seen by talent, et cetera.
Okay.
Yeah.
Now let me unpack that a little bit.
Part of it is since the start of Covid, like 2021 was a boom
year, you know, one of the greatest like venture years of
all time IPOs and everything else like that, and it went
nuclear winter after that.
Yep.
So part of the reason I'm not seeing like a mass proliferation
of investors, uh, investing everywhere in every location
because they're not investing in any location anywhere.
Yeah.
They're not investing at all.
Right.
It's, it's been incredibly dry.
So I, I haven't seen that behavior.
However, what I'm really fascinated by, and, and Ryan,
we did an episode on this, uh, not, not, not too long
ago, is how much capital startups need in this new era.
Right with, with, with everything dramatically
changing, particularly talent, that's always the biggest line
item is, is the staffing line.
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.
We, I had a, an interesting discussion a couple
weeks ago, uh, that, that mirrored this, which was.
The idea that people were, there were a group of people
complaining about the fact that, you know, investors are only now
writing checks for profitable companies with traction and
customers and all this stuff.
And I'm like, yeah, they wanna invest their money where they
think you're gonna get it back.
Yeah.
Weird.
Huh?
That didn't,
to be fair, investors have always wanted to invest
in profitable companies.
That's it, right?
Like it's a limited number.
Yeah.
My not full counter, but sort of the yes and or yes, but
the fact that you can actually get to those points with a
lot less capital now, right?
Yeah.
It doesn't take nearly as much money.
Right.
It used to take, if you had to go build an entire web platform,
right, and there's gonna be, let's just say conservatively
$250,000 to build that.
Yeah.
You can now build something that would be commensurate
to what you could build for two 50, for 25 to 50 now.
Yeah.
So we magnitudes difference in the cost it takes
to get to that point.
So that's part of why investors can say, we can do that.
And they're not actually hamstringing the, the
start of environment.
Like it might sound like they are.
Yeah.
And, and the other side of it is, you know, investors did do
those, those huge checks, the billion dollars in 500 engineers
kind of move and it didn't really back out very often.
Correct.
So, so they kind of got burned too.
Yeah.
But again, sometimes when you test your thesis and it doesn't
work, you gotta make a new one.
Yeah.
Look, if in today's terms you still need 500 engineers and I'm
using engineers just to be sure.
Right.
Then I, I'm, I'm really gonna question your efficiency.
I'm gonna question, what the hell are you building
with all those people that you couldn't be doing with?
That's clearly a sports
league that only has players who are engineers.
Right?
Right.
Can't imagine what else would take 500
engineers at this point.
A tiny fraction of our listening audiences is out there
looking for tons of engineers.
So I wanna be clear, like, you know, we got plenty of
folks who are doing CPG, who are doing services business,
who are doing like whatever.
So.
You know, they hear us say things like that and like
do that, like that doesn't even remotely apply to me.
And what I'm saying is I get it, but if, if you were packing
your stuff and going, going to Big City, whether it was Boston,
whether it was sf, whether it was New York, you know,
whatever, in search of capital, to be honest, you generally
had to, and I don't know if that's changed dramatically.
Okay.
What has changed is how much capital you would need.
Yeah.
To make that trip worth it.
You know, like back when you needed $10 million
to do anything meaningful and there was a time.
You had to go to where there was $10 million and there was like
three cities you could do it.
Now I'm just saying, and you're saying the same thing,
like the capital requirements just aren't nearly what they
were, if any, in some cases.
So the idea of having to, to, to drop everything and,
and, you know, disconnect your life to get out to the
most expensive cities just isn't what it used to be.
So I, I think.
The need for investors has gone down.
How much, how much they care about location.
I don't know how much it's changed yet, to be honest.
I don't know.
It'll be interesting to see.
Let me ask you a hypothetical here.
I just want to get, get a, uh, crystal ball moment here.
I'm curious what you think over the last 10, 15 years
we've watched, you know.
Pre-seed rounds go from 25,000 to 2.5 million.
Yeah, you're right.
Right.
Just the funny rounds have gone outta control.
As we start to see less capital required to to launch and
build and grow, do you think that we'll start to see the
round sizes come back down?
Will there be a correction around that or will it
just be more money funneled into less companies with
the same size rounds?
The venture guys have a strong incentive to put
more capital to work.
Because it ain't their money.
That's how they make their money.
Yeah, yeah, exactly right.
So, so they have a strong incentive for there to be
500 person engineering teams.
Okay.
So I wanna be clear, like from their standpoint,
being more capital efficient doesn't entirely, you
know, jive with them.
And now again, these are super smart people.
I'm not saying like they, they're trying to waste money.
I'm just saying.
Be clear when they need bigger funds and they can justify
bigger funds that they get massive takes from, that
works really well for them.
Sure.
If you were to say, Hey, VCs from this point on, no
startup will ever need more than five or $10 million,
they'd all go outta business.
So, so again, they still like the idea of being able
to put, put money to work.
Of course, they want startups to be efficient.
They don't like the idea of burning money.
Right?
And, and look, staff was the big burn, right?
Absolutely.
Always has been.
'cause it cost a fortune to find all those people, you
know, think recruiter fees, et cetera, bonuses, whatever.
Then you were always pulling people from their last
job to a new job, which meant you were paying the
most they've ever made.
Right?
Yep.
So you had to be wildly and somebody else was
gonna do that to you and pull them to their job.
Absolutely.
Right.
And you gotta pull somebody else.
Yeah.
It just becomes a cycle.
Building on that.
So as more startups needed more talent, because that
money was all, you know, getting, uh, foisted onto
all these companies Yep.
To hire more talent.
Market rates were going up and demand was going
up, fees were going crazy.
Right.
Like it kind of fed itself Right.
You know, and inflation of talent and, and, and cost.
Now all of a sudden, particularly for things
like engineering, where good engineers and smart people
are always valuable, just a hundred percent, they can
do more than, they could do more as a single unit more.
Yep.
So you just don't need as many of them.
That's a big change.
Dramatically changes the capital requirements to get to the same
point within a startup company.
You bet.
There was also, again, all these things kind
of have a ripple effect.
There was also a notion, let's say in 2021, in like
the, the height of the go-go.
That was our 1999 of, of recency.
Yeah.
There was a notion that in order to look like you needed more
capital and to be valuable, you had to hire a lot of people.
If I go out and I say, I, I need a $300 million round 'cause
I need to hire so many people 'cause we're growing so fast.
That was a strong signal.
That's exactly what investors look for to say yes.
A company with, with those ambitions and that momentum.
That's where I, I wanna park cash and, and there's all kinds
of good reasons to believe that.
Now, but since so many companies, VCs got
burned by doing that.
Yeah.
And, and not just VCs, you know, it goes down the line
to angel investors Sure.
Et cetera.
Where all it starts.
Now there's a version where at least they're like, you know,
that didn't work out so well.
Yeah.
Like, we kind of got crushed across the portfolio.
So how about we not do that again and kinda
look, look at how, how can we be more efficient?
How much do you think technology's played
a role in this too?
I mean, like, yeah, they may still prefer to
invest somewhat parochial.
Like I, I don't, I don't have a strong thesis around
that, but certainly like everybody's comfort level.
Like, well, you know, 2015 you packed your bags and
you went and found investors in 2025, we hop on a
Zoom and we do the pitch.
Right.
In fact, I know a lot of people that just prefer that, right?
I don't want somebody walks into your office with a
really bad pitch, like you're stuck with them.
Oh God.
It's like an how many, how many, how many investor offices
had to tolerate you and Elliot sitting in the, in the, in
the waiting rooms, uh, eating pizza, waiting for your,
your partner pitches, right?
So like, at some point it's way more efficient for them too.
It is, and again, investment's been slow, so I don't think
we're really gonna see what the appetite is for going
outside your parochial bubble, so to speak.
Yeah.
Uh, until we see the, the next big, like, you know, kind of
go-go moment of investing, but by the time that happens,
let's say it's a few years off, you know, where things
kind of really do cycle up by the time that happens again.
Again, with the advent of ai, of fractional, of remote, et
cetera, you're just gonna have a very different climate for
what people need than they did now, because before we were all
raising money to hire people.
Yes, there was.
There were marketing budgets, but those scale with the
growth of our product, it was hire this massive staff
and hope it works out.
Which, so let's go to the third category though, where
I wanna go to a big city.
Because I, I want the networking opportunities and
Ryan, I, I wanna split this.
There's no question that going to a big city
again, we're talking about location, that going to a
big city is gonna open you up to more opportunities.
You're about to move to a big city for exactly this reason,
for your whole family, right?
Exactly.
Yeah.
How do you justify it?
Because it's, it's gonna cost way more where you're
going than where you are now.
Well, we did the, we did the calculus on it, right?
Like there are specific things that are missing in
our current geography, right?
From a family perspective, there's things, I don't think
everybody knows where you are.
Uh, so we're, we're currently in Antigua, Guatemala, right?
And we're getting ready to head to Madrid, Spain, which
are, uh, about, you know, polar opposites, right?
We've got.
30,000 people here.
There were 30,000 people in the, in the block that
we stayed in over the summer, uh, in, in Madrid.
Right, right.
So complete different access to things like culture and
arts and, and organized sports and schools and just
all kinds of other stuff.
And then all the access to all of Europe.
So in our case, this is very much a taking advantage
of the fact that work is decoupled from life and that
life can happen where it needs to happen in order to.
Deliver what we, what we want.
So as we do the plus minus, yeah, there are lots of costs
involved in the move, but according to the calculus,
we performed the benefits.
Far outweigh that.
Right?
You bet.
And we're, we're, we're moving because we want to, not because
we feel like we need to, so we're running towards something,
not away from something or the, I mean, I guess we are still,
we're running away from the lack of, of resources here.
So for us, we're looking at this going, this is 2015.
In a lot of ways, like we cannot get, we can't replace some of
the stuff that, that we can get digitally now that we want.
Right.
And so we're, we're in a position where it does make
sense to, to pack up and go,
you know, it's, it's interesting to me is that
when I moved to, uh, to Los Angeles and to San Francisco,
as you remember, I was.
Like Johnny Networker, like, like I, I was, you
know, in, in five to seven meetings a day when I first
moved to Los Angeles, to, um, Santa Monica, I hosted
over a thousand people Yeah.
At my place, right?
Yeah.
Uh, I mean, unbelievable numbers of people as far as networking
and meeting people, right?
So, clearly I was a very strong believer in the
networking opportunities, and it was awesome.
Now, a few things that, you know, that, that I, I wanna.
Put together, number one, if you go to a bigger city,
and that's most of what we're talking about here.
If you go to a bigger city, just like you said with
Madrid, you are going to be exposed to more stuff.
A hundred percent you're going to meet more people.
I said like the folks in LA or the folks in San
Francisco as an example, paid a fortune to live there.
Yeah.
So by definition they were all like, nobody was complacent,
like everybody was there because trying to take advantage
of it, they worked their as off to be there for we had.
Yeah, yeah, yeah.
And I like that vibe right now.
Once you got past that though, like let's say
you're living in New York, you live in San Francisco,
you're also like, this is a really small apartment.
I mean, LA is the same thing.
This is a really small apartment and my quality of life sucks
depending on what you want your quality of life to be.
Now, all that said, what it was really about is you didn't
have a way to find or me.
Any of these people, unless you went to those cities that just,
you couldn't do it otherwise.
Like the other version of people, like, oh, I'd meet
people at conferences.
I've been to a million conferences.
I'm the most outgoing person I know.
I've never been to a conference that I thought was worthwhile.
Like ever, ever in 30 years.
Right?
Yeah.
It's always
the biggest waste of time.
It's always the the the, the thing, right?
Like, oh, I'm gonna go, I'm gonna make, you know,
everybody that I need to know is gonna be there.
Cool.
Are you actually gonna talk to them?
Are you gonna make meaningful connection with them?
Oh my god.
Ships passing in the night.
Right?
Yeah.
I think that's, there's something else that's
interesting there, and I think we can talk about like how
much that's changed now and the other ways that it's changed.
But like one of the things that that always struck me was, and
then sure, there are lots of people there, but one of the
things that ended up happening anytime I've been in a bigger
city was that it felt like.
Less of it was in my control.
Right.
And there was just a lot of osmotic impact.
Yep.
Some of which ended up being good.
Some of it wasn't.
You bet.
Right.
Some of it was just, it ends up just being time draining.
Time wasting.
Right.
Because everybody, because at some point like that you have
marketable things that people wanna talk about too, too.
It's not just about what you're gonna take from the networks,
but what you're gonna give.
Um, and I found that there was often an imbalance in that for
me, and, and that it made me.
A little less deliberate.
Like at some point when you're, when you're in the fish or
in the barrel with the fish, you're, you become a little
less picky around like who you're interacting with.
Whereas now that's a five.
We've got LinkedIn, right?
We've got plenty of other social media.
We've got social media X, we've got all of it.
It's crazy.
Talk to anybody.
I want to anytime I want to
because that's become such a thing.
Yeah, I think two things have happened for me.
One, I meet 10 x more people now than I ever met before and
again, and I was doing like five to seven in person meetings
where I would reach out to people to get to sit down with
them for no purpose, by the way, just to get to know them.
And it was.
Exhausting, right?
Probably.
Yeah.
So for them, uh, but, but my point is, it's
exactly what you said.
I could only meet with the people that happen
to be in my geography or that I would bump into.
Okay.
Yeah.
And I tried to, you know, create as many opportunities
for that to happen.
I met great people.
However, when it comes to who do I need to meet,
like professionally.
I can DM anybody right now, anybody.
Right.
Like it blows my mind.
And, and it also happens that like when I DM somebody
that I really need to meet the probability anymore that
they're in LA or San Francisco or where I would've otherwise
been is damn near zero.
Yeah, right.
It is not zero
because again, there's still, you know, more people there.
But like for some reason, the first person that comes to
mind, not that I, I'm trying to meet, but I was DMing
with recently, is Dan Martel.
Uh, right.
And Dan, I'm not knocking his location, but is in BFE
Canada, if I recall right.
Moncton, I think is what it's called.
And I love that.
I love that because like Dan just hit a million
YouTube subscribers.
Right.
You know, he's Johnny Social now, but he is in
Moncton, Canada, dude.
Yeah, right.
Like Dan wouldn't have been able to meet anyone 15 years ago.
In Moncton Canada.
Well, to be fair, Moncton is known as the San Francisco
of absolutely nowhere.
It's not,
this is me giving Dan a shout out, by the way.
Um, I, I, I make sure it comes out the right way because Dan
in Moncton can be the most popular person, uh, in business.
Anywhere he wants, anywhere he wants doesn't matter right now.
Again, I had to do that same thing with an ungodly amount
of physical effort with in-person events, et cetera.
And Dan's doing it without even leaving his hometown.
What I'm saying is that level of connectivity just didn't
exist at the level it does now.
No, even remotely.
Something else is funny about that, right?
Like the fact that we, we have this digital, like on
one hand it's a lot easier to just reach out digitally.
I don't know how it was for you.
But, and, and maybe this is even, I'm, I'm, now I'm
trying to figure out, this is like more of like a post
pandemic kind of thing.
When I do get in-person introductions, not in-person
introductions, but maybe like somebody local, like,
Hey, somebody here that wants to sit down with you.
I almost always say yes.
Part of that might just be the rarity, but part of it's kinda
like it feels rude to say no.
Yep.
Whereas.
With digital outreach, I think it forces people
to be a little bit more deliberate, a little bit more
polished in the outreach, A little more purposeful.
Whereas like before people could just reach out and
be like, Hey, you know, I'm, I'm gonna be in town.
Would you like to get together?
Like,
yeah.
Okay.
Right.
Yeah.
Whereas if somebody reached out to me on LinkedIn, they're
like, Hey, do you need offshore web development services for an
app that you're not building?
No, I don't.
Right.
I don't have to spend time on that.
And so like, I think it's somehow by being digital,
despite the fact that we have this ability to reach
anybody, it's raised the bar a little bit for what that
communication looks like.
I actually appreciate it a lot.
Pointing to Dan for a second.
What I'm saying is Dan has a massive profile Yeah.
In Moncton, uh, you know, sitting in Moncton, Canada.
Right.
I'm just saying that's possible.
Whereas it wasn't before.
Again, this isn't the same as like if I was 27 years
old and someone was like, Hey, you should move to
New York, or you know, San Francisco or something.
I would do it right because it would cost me nothing.
It'd buy me a ton.
Great big city experience.
I did it.
It was awesome.
What I'm saying is now I just wouldn't have to
before you have to, I had to, I didn't have a choice.
Yeah, right.
Now I just don't have to.
And that's a big deal.
You don't have to move to San Francisco to,
to, to find work, right?
Yeah.
Like you can go
anywhere when Yeah.
I think the minute it went from being a prerequisite to a
nice to have, if I want to have it, maybe not even a nice to
have, it's a a if you want it.
Right.
It became completely discretionary.
That was super powerful in, in so many ways.
Right.
Look like we've, we've talked about a lot of stuff like there,
there are still some advantages.
Of course there are, right, there are advantages like
things like you mentioned, these serendipitous meetings
and cultural immersion, some of the stuff that
I'm moving for, right?
But the, but the cost benefit has certainly shifted and I
think it's no longer a case of, of necessity and, and
more, more like one of desire.
But the other side of it is you're, you're
not moving for work.
Yeah.
Also that a hundred percent.
Yeah.
I mean, that, that's dramatically different.
You're saying, I wanna go have these experiences
in this other place.
Yep.
Now, if, if you guys were, you know, super into
skiing, you might be going to Provo, Utah, right?
Yes.
Like, right, like there might be a totally different outcome.
You guys have an amazing, uh, ability as a family
to ingratiate yourself in the local culture and, and
pull so much from that.
But it has nothing to do with your job.
No.
Nothing.
Right?
Nothing whatsoever.
Now there will be benefits.
In fact, we've gone, we've gone through some of that recently
because there was then this, this kind of toss up between
Madrid and possibly Valencia, which gets us on a coast.
And there was some other, it's a little bit smaller, a little bit
maybe easier to, to end up in.
And then we went back to it like, but why are
we actually doing this?
Right?
And a big part of it is for some of that bigger city stuff.
And for me, from a work perspective, there are some,
there are some pluses to Madrid.
It's a much bigger commercial center.
There are way more startups there than there were
going to be in Valencia.
Are there as many as there are in, in San
Francisco or New York?
No.
But it's still from where I am now, it's gonna
be a massive increase.
And so there will be benefits, but is again, but it's
not, we don't have to make the choice based on that.
Again, it's, it's not, and that's really what we're
saying is isn't relevant.
Right.
It's just a
lot less relevant than it was.
It's changed from a you have to do it.
Mm. It could benefit in certain ways.
Yeah.
Like when Sarah and I moved to San Francisco, you know,
I certainly had a, a single unified goal, which was, at the
time we were buying companies and most of the companies we
were looking to buy were there.
And it worked out great, you know?
Yep.
It, it, it really worked out.
But from Sarah's perspective, you know, uh, my daughter Summer
had just been born, I think she was five or so at the time.
She just wanted an adventure.
She was like, Hey, cool.
This is just something new, right.
I don't, something fun, something different.
Yeah.
The commercial aspect doesn't matter to me, and she got
to explore it, et cetera.
After a while, she was like, guess what?
This city's terrifying.
Yeah.
I've seen it all.
No cross.
You can cross it an hour.
And I've seen it all.
I'm good.
It's the part they don't put in the brochure, but you know,
Sarah would, would, would leave our building, uh, with
a five-year-old in a stroller.
It would not go well.
It was, it was a very dangerous place for a woman in her.
A little tiny daughter to be walking around there.
There's reason you don't see any kids in San Francisco.
Yes.
They're all adults anyway.
Um, this wasn't a knock on San Francisco.
I'm just saying like if she was going for her own reasons, she
would've been out very quickly.
Yeah.
I would go there and, and I would put up with whatever,
because I needed to be there.
But now I wouldn't even consider it.
I was like, yeah, I would never do that.
Not knocking San Francisco.
I'd go there for fun.
Right.
But if we're like, oh, our business has to be there, I'm
like, no, no, it does not,
does
not, does not need to be
there.
Yeah.
I, I think it's so interesting too that like, at this point,
because of this, this shift in, in like the, the value of the,
sort of the, the perks of being in the traditional hubs, right?
That the value.
Of the flexibility has actually gone up so much, right?
Yep.
Now that you really kind of can, I think there were
so many things that people didn't even consider before.
It just didn't, it didn't occur to people.
They could just be wherever they wanted.
Yep.
And still do the thing that they wanted to do.
And I think that is, in as much as the value of the traditional
hub and what you get from it has gone down to some degree.
I think that the, the bigger imbalance has actually been
created by the value of being able to do what you want can
anywhere you want, has actually gone up so significantly.
And I think that for me is what has absolutely made it really
hard to say that like there's a huge benefit in being, or that
a, the success of a startup is predicated on being in
some, somewhere very specific.
I'd say the flexibility to be anywhere for me at least.
I, a lot of people that we know, uh, would far outweigh the, the
perks of the traditional hub.
Yeah.
So look, I, I think what, what we're saying isn't that
cities don't have their value.
Cities have value.
We love cities, right?
We've lived in them.
What we're saying is in this day and age, you would be hard
pressed to make an argument that says you have to relocate
to a major city or a specific location in order for your
startup to be successful.
The, the truth is there are so many things that have changed
so dramatically that you can take advantage of that you
just don't need to do it.
So I would say at this point, when somebody asks
you that question to say.
Hey, where's your startup based?
Your answer is wherever the hell we want it to be.
And I'm damn okay with that
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 bootstrapped founders and the advisors
helping them win in the startups.com community.
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