Michele and Colleen dive into striking a balance between business, founder, and lifestyle fit, and the trade-offs of running your own business versus working for someone else.
So last week, Colleen, you said something to me that really seemed to resonate and jump out at a lot of our listeners. And that was that you aspire to have a business that is in the position that our business is in, but that you don't want our lifestyle.
Colleen Schnettler 0:23
Yeah, so I felt a little bit like a jerk when I was editing the podcast. And I heard myself say that, and I almost cut it out. But it's true. And I'd love to discuss some of that with you. Because kind of my vision is what I want as a solo founder is pretty specific. And you guys seem to be in a whole different place than what I envision my success looking like.
Michele Hansen 0:49
Yeah, and I would love to talk about that. And I'm so glad you didn't cut it out, because it was echoing in my head all weekend. And I really appreciated your honesty about that.
Colleen Schnettler 1:02
Okay, if you say so. Still feel mean!
Michele Hansen 1:06
I appreciated it. And it really seems to resonate with a lot of people listening to that. The fit of founder and business and lifestyle is so important. And I think you this is something that is worth diving into, because it's not just about the founder and the business fit, having the expertise and the sort of know how and you know, environmental knowledge and whatnot to make a business happen. It's also about having a business that fits the kind of lifestyle that you have, or that you want. And you know, Lord knows I hate the term lifestyle business. Right. But that is one of the things about this is you basically get to choose in a way, what kind of life you're going to have. And I think that applies even if you have a corporate job, right? Like, do you want a lifestyle where you are flying to a client site four days a week and barely see your kids? Like, that's a lifestyle, that's a lifestyle choice. Do you want a business where you're home, but you are maybe managing email over dinner, which you may do as a solo founder, or you may do working in a corporate job somewhere. I think this is really worth diving into and the fact that like my business, and then the way we run our business may not be something that you want. And in an environment where we're conditioned to look at other people. And there's this expectation that if people are successful, everyone wants to emulate what they do. That's not always the case. And we need to leave way more space as a culture and as a group of people that one person's success is not somebody else's success, and may even from a certain perspective look like failure because of compromises they're making in order to get to that success.
Colleen Schnettler 3:20
Sure. So my first question for you is, I feel like Geocodio kind of built up around your family. And it seems like, you know, you guys got on a trajectory where things moved pretty quickly. After you got a foothold in the market. What do YOU want? Like if you could go back and and think about how you would design your business that fit into your life that provided you the opportunities you you want, like, what would that look like for you?
Michele Hansen 3:53
That's a really interesting question. I've never thought about that. I think partly because, you know, I wonder if we had changed something, maybe things wouldn't have worked out as they did. Like, there's certainly things along the way that were difficult. But I don't know if, if I would choose to not do those things or do things differently. I will say that we -- Yeah, we it has grown up around our family. You know, we launched the business when our daughter was four months old. A big reason why we even got started launching our side projects in the first place is because we had the bejesus scared out of us looking at the cost of daycare. I mean, it's more expensive than college in a majority of states. And you know, being pregnant and realizing that got us us supposed to be like, we can't be spending our weekends watching Game of Thrones anymore like we got to start launching stuff because...
Michele Hansen 4:45
this is this is you know, we're gonna be pretty close to paycheck to paycheck without something else happening, you know, and, and I remember just like us talking to each other and being like, we can kill it at work, but we're Still not going to get the kind of raises we would need in order to comfortably afford, you know, $20-25,000 a year in daycare alone, plus all the other expenses that go with having a child. Like, it's like we knew it would be expensive, but what can we just, you know, until we started researching it, like, we just didn't have a concept for how bad it would be. And, and you know, that first year, like, I don't even know how much we made, but I think it was barely enough so that we didn't get charged a maintenance fee on our business bank account. So not very much. So we see we wasn't at the point where we're really making that, you know, quote, unquote, like, daycare level amount of money for a while. Um, yeah, our family absolutely grew up around it.
And I think I probably would have given myself more permission to not feel like things had to be handled immediately. In terms of like customer support, things like that were happening at night or dinnertime. But at the same time, for every time that there was something blowing up on Intercom that we need to deal with during dinner, there was something blowing up on Slack at our regular day jobs that was also getting in the way of family life. I don't think our business has gotten in the way of family life more than a, quote unquote, full time job would in fact, I think it's much more flexible, because it means we can take time off or you know, snow days aren't as much of a big deal, of course, I mean, lockdown was just awful for everyone. I mean, I guess now we sort of stare it down again. But I feel like I'm rambling.
Colleen Schnettler 6:45
So try this on for size. So you've done that. And now you're in this position where you have said to me privately and on this podcast, like growth is not really a primary motivator, you don't want to be acquired, you don't really care how quickly you're growing. So what do you want now? So you kind of done the hard like trenches work to get you in a comfortable position? Like, are you are you happy with the status quo? Like, do you have ambitions to if it's not to grow to work less? Or what are you thinking now.
Michele Hansen 7:20
So we do have goals, they're just not other people's goals that you would normally hear about, I guess. So I set some goals last year after doing my sort of semi-annual customer analysis from from a high level of our data. So basically, I, I look at all of our customers like a portfolio. And then I evaluate that based on industry and company size. And some other factors, just basically just like an investor would a stock portfolio, and try to see how it's balanced, you know, making sure that we're not getting too much of our revenue from one individual customer, or even from the top 90%, or the top 80% of customers. And so trying to manage for different risks that way, is more how I think about goals. We will have goals based around industry. So for example, this time last year, maybe like last summer, looking at our portfolio of customers, I realized, like 20% of our customers were in real estate. And I felt like that was too much. And so, no, it wasn't purposely going to try to get rid of those customers or anything like that. But instead, I was like, you know, I would like to focus on some industries that are maybe more stable than real estate and try to focus my marketing efforts and sales efforts on industries that are more stable than real estate. So we made a conscious decision to try to focus a little bit more on banking and financial services, and also on health care as well. And so that was a goal we had of getting the percentage of financial services customers up to a higher percentage. But it wasn't it's not a growth, overall revenue growth goal or a user goal. It's the percentage of our revenue and I'm always keeping an eye on things to see. Okay, let's make sure that, you know, no one customer is more than 1% of revenue. That's something that's very important to us that requires growth. Because also very often we have ARPU growth or observe average revenue growth in those, those top 80% customers. But we're not necessarily chasing a number around number of users signing up per day or per year, or credit cards being added to account or even really even the number of high level customers specifically sort of on a user level. It's more on a portfolio level that I have these goals.
Colleen Schnettler 10:02
Sure. Um, can you talk a little bit though about like, your personal goals and how they tie in when we talk about like business founder, lifestyle fit? Like, what do you want?
Michele Hansen 10:17
Did you just ask a question about feelings, and I answered about numbers?
Colleen Schnettler 10:20
Yes, that's exactly what happened. That's all very interesting. But that's definitely not what I asked you.
Michele Hansen 10:28
Our goal is to keep doing what we're doing as long as we can.
We are happy with the kind of life that we have, we feel very grateful that we run our own business, I don't think it would be a fit for everybody, you know, in terms of lifestyle, like the number one thing I get feedback on about lifestyle, is people saying, "Oh, my gosh, you work with your spouse? How is that even possible? We would kill each other? like, Wait, how is your marriage?" and I'm just so uncomfortable, whenever that happens. And like, I feel like you're projecting a lot of your own marriage on me, and I'm not quite sure how to react to this. Because for us, like, like working together as a dream.
Like, there's no drama, you know, I mentioned like, you know, slack blowing up on at night, like, who hasn't experienced that we have none of that, like, we have none of that, like interpersonal drama going on. And it's awesome. But it's also because, you know, we're a fit together as people, and if we weren't a fit together as people, and that wouldn't work. And I think both of us handling this, like we, you know, we know to trade off and, and sometimes it's, Hey, can you handle this, because, you know, I need to go get our daughter from school, or like, one of us is making dinner and the other one is responding to someone, and we can balance things off of one another in a way that I think a good marriage should be able to have, you know, can you feed the baby now, because I need to go do this other thing, like, there's always that give and take, and maybe we just negotiate that, like particularly well. But we really like working together, we think that's the perfect optimal scenario.
And there's always things that can be improved. You know, I talked about customer support last week a little bit. One of the reasons why we hold on to that is we actually enjoy it, like I like talking to people, I like feeling like I'm helping people, I like the amount that I learn from that, like, I get so many ideas for how to fix our product, or how to make something easier for people or just learn things from talking to customers. And that's in a, in an interview setting that's in a chat setting as well. It's probably not ideal to be responding to that kind of thing at 10 o'clock at night. And I'm working on, you know, managing my own need to, to do that. But yeah, what we want out of our out of all of this is just to keep doing this. And so I guess, you know, I mentioned those portfolio level goals I have really that goal is stability, right? Like I you know, my first week of college was the 2008 financial crisis.
So that was incredibly traumatic, like, like everybody walking around, and being like, Well, my college fund is gone. And knowing we're gonna graduate into a recession, like economic stability, and calm is so important to me. And that is much more important to me, than, you know, getting, I don't know, millions of dollars from being acquired, or having some growth numbers that would impress people like those kinds of things aren't important to me. What's important to me is stability, and stability for our family. And so making decisions that lead to more stability is how we tend to think about things.
Colleen Schnettler 13:55
Yeah, I think, kind of what was you were talking last week, what prompted my comment was for me, I went into consulting to give me more flexibility, right, like, so I am never on call, like, I don't work with people that want me on call. No thanks. And I have a lot of autonomy in who I work with. And all of that has been great. And so for me, I've always thought that the next step with the product business would be even more flexibility, right? Like, oh, you make money while you sleep because someone's buying your product. But it's interesting, because as I talked to more and more solo, or couple founders seems like there's a lot involved in off-hour support requests. I mean, you're not the first person to say this, that you're working at 10 o'clock at night. So it's just kind of an interesting. It's it was a really kind of interesting thing for me to think about like okay, right now. I have a great situation with client work. Everyone's pretty chill. Like I said, You're not allowed to call me in the middle of the night. No one has my phone number. I don't check Slack -- it's not on my phone. Like it's pretty good. And so I wonder is as I make the shift into like product based business. It'll be interesting to see how that changes. Now, to be fair, when I was growing the consultancy, like, in the beginning, I was hustling, like I was working all the time, I would work my normal job during the day. And then I would work till 10 o'clock every night. I was exhausted. Maybe I did that for 18 months. And that was worth it to put me in the position I'm in now. And I'm just, it'll be interesting to see if like, I grow a product business. And it's like a lot of hustle up front. And then I mean, really, my goal is to work four hours a day, like, that's, that's kind of where I want to be maybe six, and spend the rest of the time doing whatever I want. That is my appeal that in the autonomy is what appeals to me in a product business. But it'll be interesting to see is like, I go through this process, if that actually materializes.
Michele Hansen 15:47
Yeah, having truly passive income that you don't have to do any active work for, I think, the dream of a lot of people.
The only situation I really seen people actually get that is, you know, when they have a portfolio of dividend paying stocks, but even then you have to worry about, you know, the value of them going down, and then you get less from the dividends, and you have to research new ones. So there's work involved there.
You know, I also, like I will admit, like, I am definitely a recovering workaholic. And I don't say that to be glib, like, I used to work a lot at night and on weekends, because I was, you know, trying to show what I was capable of, and trying to prove to other people that I was capable of more responsibility and doing more things, and so hungry for, I guess, a sense of approval, right.
And it was so scary to walk away from being in a corporate environment where, you know, you're getting that kind of feedback and criticism all the time and having performance reviews and almost like an academic environment where you're getting graded, to going to one where you are working for yourself, and there's no one standing over you telling you how good you are, and aren't doing -- that was terrifying at first. But then, you know, it was liberating, because I realized I didn't have to get that approval from other people. And I didn't have to work all weekend anymore to show that I was capable of doing the caliber of work that I thought I was capable of. And so now, when I find myself working on the weekend, like it's pretty rare, and but I really don't mind, because that is the price for having the freedom. That is the price for not having to impress somebody, and to show them what I'm capable of as a human being. That is the price of our family getting to go on vacation whenever we want, or getting to, you know, live this life where we have literally just picked up our life and move to another country.
And yeah, there's definitely been complications, but not as many as we would have. If I had to go get a job somewhere. There, there's always a cost. And I think you could maybe design a business where you only have to work four hours a day. I don't think that's what I want, though. Like I genuinely enjoy working with my husband. And, you know, people always ask us, well, why don't you just, you know, sell the business. And then you can do whatever you want. And I'm like, because then we would have to find another business to start. And that's a lot of hard work. But also like, we we just enjoy working together.
And that may not be true of a majority of couples. And you know, we've certainly all heard horror stories of people who worked for couples that should not work together. But that's not the case for us like that, that cost of doing stuff at night or on the weekend. It's worth it. Because as you said, you want the autonomy and you want the freedom. And it seems weird that freedom could involve replying to something at two o'clock on a Saturday. But at the same time, also, I have the choice, like if I don't reply to that, and I decide to wait until Monday, and as a result of that we lose the customer. You know, who might get upset about that? Me. There's nobody else who's going to tell me who's going to say you should reply to that on Saturday. And as a result, you're not getting your half a percent bonus this year, right? Like, that is not going to happen. Like if I decide to not reply to something and then we lose that customer, I am out 100% of that money. And I am the only one you know, or you know, my husband and I -- like we're the only one who decide whether that was an appropriate decision to make. There's nobody else who is lording over us telling us that we should have done something differently.
And that is great because I feel like it is a choice to respond to those things. At midnight or, you know, it doesn't so much feel like a choice when you know a database server goes down at three o'clock in the morning and we get the blaring alarm and stuff has to happen, though. How is that really different than having a baby baby? I mean, so it's everything is a choice.
Everything is a choice. And and yeah, that that autonomy comes at a cost, but to me, the benefits of the autonomy are worth it
Colleen Schnettler 20:14
well, and also being directly responsible for the amount of money you make, like if you were working, if you're on call at a normal web development job, and you have to answer a call at 2am, you don't get paid extra for that, right. Whereas if you're answering a client and you get a new client, like that's directly impacts you and your business in a very tangible way.
Michele Hansen 20:34
You get all of that versus when you are, you know, it's your turn to be on Pager Duty for the weekend, and you have to handle a bunch of stuff. You don't get paid extra for that. Like maybe you can say in your performance review, like, well, look at all of these weekends I worked and here's all the value I led to the company, and then you maybe get a raise or a bonus because of that. But when it's your own company, you can say like, hey, like, because I work that weekend, like I made an extra $3,000. Is that worth it to me? And you can decide whether you want to do that next time. And maybe it is, and maybe it isn't. But you have that full responsibility, and you get all of the benefits of that responsibility as well.
Colleen Schnettler 21:14
I think those are all really good points you're making.
Michele Hansen 21:17
I think sometimes you don't, you don't really know what you're getting into when you're getting into it.
Colleen Schnettler 21:23
That's kind of how I feel.
Michele Hansen 21:24
Like I don't know what kind of business you know, as you said, you know, you would love to have a business where you only work four hours a day. I think it would be kind of challenging possible, but challenging to say, going into something and saying I only want to spend four hours a day on this, or I want a business that only requires four hours of me every day. And, and then finding a problem that is solvable in that amount of work per day. And as you're saying, I think it's a fluid thing, where, you know, you said you were hustling really hard for the first 18 months of your consulting, and then you were able to scale it back a little bit. Like I definitely work less now than I did four years ago, when I had a full time job, like plus the side project, like I work way less, and I have way more family time.
Colleen Schnettler 22:14
For me when I say four hours a day, I just kind of think when I've been thinking about building a business, and each step I have taken has gotten me closer to independence. And what I value the most as a military spouse with three kids is my flexibility. And I really have built that with the consulting. I mean, consulting has its own drawbacks, because I have different clients who have different needs. And that can be frustrating, but ultimately, I've already built this flexibility into my life. And when I think about starting and having a product business, I really want the product business to reflect that. So I don't mean that like I only want to spend four hours a day. I mean, I want to be able to own you know, to work in a way that like fits into spending time with my kids and my spouse and going on vacation and do these other things. And this in no way like what you're saying, in no way dissuades me, like I definitely can see how you could build your business a different way. I just am interested that you've chosen to build it this way. And it's you know, I think from our conversations, I've learned it because you love what you do. You take great pride in it. And it's it's a really fulfilling endeavor for you. I think, when if I ever get to where you are, I will have structured things differently. So it'll be interesting. Let's check back in five years. But it'll be interesting to see I can see myself just being where you are, and, and just structuring things a lot differently. But I guess that's that's an important point, right? Like, people are different. And people want different things and have different priorities.
Michele Hansen 23:43
I think what I'm hearing from you is that you want to be able to work when your kids are in school. And then yeah, and have to work and be able to be with them when they're at home, which is really reasonable and incredibly screwed up that that isn't the default for like work. Like so, you know, being in Denmark now. Like one of the things really struck me is how most businesses you, you know, they don't open or you can't even get them on the phone until 10am. And then they are closed at four. And that is a hard stop.
And the school especially for elementary aged kids, like they go until four o'clock. They go from eight to four. And the work day is you know, from from nine to four, or 330. And it's pretty fixed. And there's definitely no differences in that and tons of self employed people as well. But it's really fascinating to me that it's not like well, you know, the workday ends at four but really like we're working until 5:30 like it's fine as it is in the US where it's pretty common to be at work until six o'clock and even then that's like a badge of honor.
Here, it's like no, everything is closed at four. If you need to hit Handle it during the day even stores close at five, six o'clock.
That's so weird.
But it's great, right? Like that is like, like you have work time and you have family time. And you're not just spending 16 hours a day exhausting yourself. Right? Like, I mean, this is a fundamental failure of American culture and life right now is that so many people have to have multiple jobs in order to afford life like I mean, what drove us to create our business was we couldn't easily afford daycare, like a basic necessity of having a child. It should be that you can have a job or have a business and work when your kids are in school. That seems like a very, very reasonable goal to me.
Colleen Schnettler 25:56
And it's not really attainable in my field, like as a software developer, like, No, you can't show up at work at nine o'clock and roll home at four and then not check your email Slack or whatever the rest of your right like, it's not something our culture here, especially in tech, is not structured in a way that allows you to, that's all I want, right? All I want is to work with the kids are at school and be with the family when they're not at school. But like our our life, here is not structured that way like it, it's just not. And I've been dealing with a lot. I'm glad we're doing this feelings episode today. Because I've been dealing with a lot of feelings, because we're about to have some more financial stress and pressures. And so I've been trying to figure out how I can cover that. And I've been kind of vacillating between, consult more, which is kind of the easiest solution, get a full time job, which is maybe even easier. But to do that, like I'd have to give up side projects, or at least decrease them even more. And oh, man, it's just a lot of trade offs and drawbacks, and each in each area. But I think a fundamental problem here is all of these things I want to do require a lot more than working from eight to four.
Michele Hansen 27:08
I am so glad you brought that up. Because I think that's such a common thing of thinking that getting a full time job somewhere, will give you more stability or more income when you know, the thing about bootstrapping your company is that it takes time, right? And so I would sort of think about like, how soon really is this financial situation changing? And is that is it right now? That happens sometimes, but if it's three months from now, maybe you've got a little bit of time to get your business going, maybe do a little bit more consulting, as a padding, though, that's also that's, you know, consulting, you're charging for your time. And so there's a fixed amount of money that you can make in it versus with a product business there really isn't. But, you know, as you said, Your goal is being able to work when your kids are in school, or when they are in front of their laptops at home doing virtual school.
And and I gotta say like, that's something I love about the bootstrapped world is these kinds of goals that we have. The rest of the sort of the tech world is very, there's this prevailing ethos that you should always, you know, be hungry and hustling and, like, you should be working 20 hours a day. And if you're not, then you're you're weak and pathetic, and you're whatever, whatever. There are certainly lots of, quote unquote thought leaders out there who will preach at you for not working all the time. And something I love about the bootstrapped world is there are so many people who I get into talking with them and it's really because they wanted to be able to spend time with their families, or they wanted to be able to live in a place where there aren't really any tech jobs, to be close to their family. And so they work from home and they have their own business. And it's like such a family focused avenue of tech that was so unexpected for me being around that very hustle porn sort of sleeve of it that is so predominant, that that goal that you have is maybe even need a little bit more money, having your own business that fits with a sane life.
Colleen Schnettler 29:22
It's feels hard to get there. And I feel like with building this product, you're absolutely right. I do have a little bit of time. Man if I could just get this going. And I can. I know that I can but it man it just feels comparing this balancing this a side project that I hope turns into a bigger than a side project with consulting and the pandemic and managing you know, family feels overwhelming right now. And so if I were to make a choice right now, the easy button does seem to be like just to get a job. But that's I, you know, I've, I've read before that, you know, and I've seen this a lot like, people who get what they want, know what they want. And I know what I want, but I'm just sometimes -- The truth is, I think I'm a little too scared to go after it.
Michele Hansen 30:24
I'll tell you how we grew. It was just listening to people. We got something out there. And then we listened to people about what they were trying to do. And then we did that. And we asked them, okay, does that work for you? Why or why not? What else you trying to do?
You know, you mentioned that you started this out thinking about images. But I think it was in last week's episode, you were talking about how you had people say to you, Hey, this is really great for images. But I also really need this for PDFs. And there's like really nothing for that. Listen to people. Do that. Just slowly build it by getting it out there listening to people, doing something about what they tell you. And then take it from there. And then maybe you'll find something that works. You know, there's no guarantees. But I have found that if people are willing to be open with you about what they need solved, and you listen to them, and you do it, they'll be very appreciative. And they will pay you, especially if it's a frequent pain that they have that no one else is really solving. And so that does take time, that does take evening hours, that does take sacrifices. But hopefully you can get to a point where you're doing something that nobody else is doing, even if it isn't a commodity space that is possible. And having that kind of, you know, income, that that you need and finding a way to negotiate that with your life, and figuring out how your hours fit into all of that.
Colleen Schnettler 32:01
Yeah, no, that's great advice. I, I needed a little pep talk. Yeah, that's great advice. And I think that's, that's what I'm really going to focus on as at least for these next couple months. You know, some people I've heard, they're finally successful in their business where they don't have another option, right? Like, like, what it's like, oh, man, like, I really need to this to work because I really need to make, you know, to increase my income. So maybe a little pressure is just what I need, you know, to turn me into a diamond.
Michele Hansen 32:31
I think that's a good note to end on. People want to stay involved say what you think about our conceptions of business and lifestyle and product and all of that, please feel free to tweet at us softwaresocpod. We'll talk to you next week.
What is Software Social?
Two bootstrapped software founders -- one transitioning from freelancing, and one with an established business -- invite you to join their weekly chats about their businesses.