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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
joint, as always by my
friend, the founder,
and CEO of startups.com.
Will, Schroeder will man, they
run on lots of different things
and, uh, founders, founders have
to run on a lot of optimism.
Some might say that it,
uh, it, it borders the
line of, of delusion.
You said something once and
it was, it was something along
the lines of, you know, like.
Firefighters run into
a fire that's already
existing and, and get out.
Founders run in, start
furnishing the lobby,
ask if they can pay rent.
Yeah.
And then light the fire,
which sounds delusional,
but it's really, probably
better looked at as optimism.
But in your mind, like what's
the alternative, right?
If, if, if a founder
doesn't show up.
Full of optimism and believing
that this thing can happen,
then what are they, what?
What would they run on
at that point?
They're an employee
and that's an employee.
As employee shows up and an
employee is like, Hey, just tell
me what to do and I'll do it.
We have this weird gear.
And, and note even has
to tell us to have it.
We just have it where we're
willing to create this fantasy,
this delusion, and live in that
world, and not only live in that
world ourselves, but convince
all of these other people to
live in that world as well.
Yeah.
Yep.
Employees,
customers, partners, stat.
All of it.
Yeah.
Everybody.
Yeah.
You know, investors
are a great one, right?
Yeah.
And we believe in this
delusion so greatly.
So greatly.
Like, like religiously.
Even though nothing around
us whatsoever supports it.
Right?
Right now we're like, we're
gonna change the world and, you
know, build Uber, we're gonna
build, you know, whatever.
But everything around us
right now is like, dude,
you're still living in
your parents' basement.
Like, like, we don't have
$500 in our checking account.
No one wants to work here.
This idea has never been
proven, like nothing around
us indicates that this
fantasy that we have should
inspire any level of optimism.
Right.
And yet.
Our business, our what
we do here is driven.
Wholeheartedly by creating
this optimism out of total
chaos in, in many cases,
like an abyss of bleakness.
And so I thought it would
be fun to unpack that.
Like, where the hell
does that come from?
Why do we have it?
Like, is it honesty?
You know, is is, is it
honest saying I think
something's gonna happen.
That may never happen.
So I think as we dig into
this today, and it's a topic
I wanna talk about for a long
time, I really wanna talk
about that, that source of.
Optimism in, in
how we even get it.
The font of optimism.
Yeah.
I, I think it is interesting,
you, you touched on
something there, which
is that like they're all
sort of chaos by nature.
Also short, I mean, maybe not
by design, but by nature, right?
Like if that chaos didn't exist,
if there wasn't chaos to be
unwound, there's no opportunity.
Yeah, that's true.
Right?
Like it's already solved
at that point, or it's
not worth, worth solving.
It's the chaos that creates it.
I mean, I think it's important
to note like startups aren't
set on fire by accident.
It's kind of the, uh, we
light that match to start
to power the vision, right?
That's how we see where
we're going, right?
It's the, it's the,
the flames of that fire
run toward the chaos.
What drive us forward.
It reminds me of a, uh, a
commercial from like in the
eighties or nineties, and it
was showing this like huge
commotion in the distance.
Like I think of almost
like, like a, a long plane.
And, and on the, in the distance
there was like explosions and
all this like, like chaos,
uhhuh, you saw all these
people fleeing from it, right?
From the explosions.
Then you saw one guy
running toward it.
Towards it.
Yes.
And it was the ad
for the Marines,
right?
Yeah, yeah, yeah.
Um,
and it said something to, to the
effect of we run toward chaos
when everybody else runs away.
Right?
Yeah.
You know, we strip out
Marines there and, and,
and insert founders.
Now of course, it's slightly
less physical present
danger, uh, in our life.
A hundred percent.
But metaphor, but
exactly the same concept, right?
Yes.
Yes.
The people fleeing
are employees.
Right.
Those people are
like, this is chaos.
This is crazy.
I'm gonna go get another job.
And also, they're
the rational people.
Uh, in this commercial.
The founder runs directly
toward that chaos.
Kinda like you said a moment ago
with the, uh, the firefighter,
firefighter runs into a building
with the optimism that, that
he or she's going to get out
as soon as possible, right?
Correct.
A founder runs into a
burning building and like you
said, sets up camp, right?
Like, yep.
Yeah.
This is where we're
gonna camp.
I'll be here for
the next decade.
It's already got a
campfire, guys.
Yeah, that's idea.
The campfire is
falling down around us.
That's okay.
Exactly.
And also pouring gasoline
on it while, you know,
uh, while they're coming.
Yeah.
Yeah.
So if we start there, like, like
why the hell do we even do that?
Like, like what would possibly
take a capable, potentially
rational person and say, I'm
gonna go do the, the least
rational thing I possibly can
with the, the smallest chance
of success versus all my other
options and passionately drag
everyone I know into this
burning building because I
think something, you know,
great's gonna come of it.
That's kind of psychotic.
Like if you put it in
terms like that, that way,
yes.
But
it's
kinda
what we do, you know?
I, I think it, a lot
of it times it does, it
starts with the passion.
Uh, you marry that passion up
for like, you know, wanting to
solve that problem, wanting,
make that dent in the universe.
You marry that up with what
at least can look like, can
be outsized economic impact
and, and financial outcomes.
And, uh, for most of us, some
desire to just be able to do
things on our own terms and
do it the way we wanted to.
And this is one of the few
places you can do that, right?
Right.
You can't walk into
an accounting office
and, and start a fire.
Well, you can, you just,
you go to jail for it.
Um, right.
It's, the problems
have been solved.
Right.
Like it's just, it,
it is what it is.
There's no chaos to be
unwound there in most cases.
Agreed, agreed.
Um, you don't get to
create anything, right?
And so I think it's this draw
towards creation, draw towards
creation of something we want
to do and, and sort of this.
More perfect future that
we can envision lit by the
flames of this fire that
we started, that we are
willing to be unreasonably
optimistic as we move
towards trying to create it.
Knowing, knowing in most
cases, and being willing to
wake up every day and ignore
that fact that the odds are
really well stacked against.
I think once founders get into
this a little bit, like, uh,
in when consequences start
to get created, consequence
could be them not making
payroll, you know, things
like that, like real issues.
I think going into
it, it's sexy.
It's sexy to have a big idea.
It's fun to ideate, to
brainstorm, to throw, you
know, ideas in the whiteboard.
But when that changes from
the initial pixie dust, as
we always call it, to the
actual job of what this is,
which is every day waking up.
Being like, oh my God,
my job today is to
create 10 more problems
I didn't have yesterday.
And, and if I don't do
that, I'm not doing my job.
And when I say it in those
terms, like people think,
I'm like overstating it.
That is the job.
Your job is to go find problems.
Now it's a hard job,
don't get me wrong.
It's a hard job, right?
Ryan, you and I wake
up in the morning.
You and I are very early in
the morning, and then we start
unpacking problems immediately.
We literally look for
stuff to go, uh, break
or fix one of the two.
They seem to arrive with
more frequency than the
Amazon man at this point.
Yeah, they do.
They do.
But for a lot of
people that, that don't
understand this path, yeah.
They look at that as, I can't
believe everything's breaking.
What am I doing wrong?
And it's like, yeah,
no, this is the path.
They're actually, this is
the job isn't another path.
Right.
I watch it not just with
founders, but I, I think
about different paths in our
lives, d times in our lives.
We have kind of this, why
is everything breaking?
It must be me.
Both.
Both.
You and I have teenage daughters
and they're living in this
for the first time where their
social circles and everything
else like that are becoming
geometrically more complex.
You know, people aren't asking
people to dances and things like
that and, and they're like, oh
my God, what am I doing wrong?
We look at that and we're like,
that's just being teenager.
Yeah, that's, that's,
that's the case.
All the trials and
tribulations of being a age.
Age, yeah.
But if you're living it, if you
haven't been through it before,
and this is, you know, akin to
us seeing new founders that come
to startups.com and their heads
are on fire because they're
like, there are so many problems
that I'm dealing with right now.
What am I doing wrong?
My most consistent answer
is, you're exactly where
you're supposed to be.
Yep.
This is exactly what you're
supposed to be doing right now.
You are supposed to be
in the shit in all these
problems, losing sleep.
It's not awesome.
It's not healthy, I'm
saying, but this is the job.
You know, it reminds me
thinking about that the first
time founder versus the, the,
the not first time founder.
Right?
People have been
through this a bit more.
And I think we may have
referenced this on the pod
before, but it's essentially
like that scene from insert
World War II movie here, where
you've got like the grizzled
sergeant walking around
and you've got both the new
leadership in the terms of
like the commissioned officers
and the, you know, the,
the first time, uh, grunts.
They're all running around like
pure chaos and you know, the
s sitting private Ryan walking
through not reacting at all.
Right, right.
Like light in smoke and
just walking through all
the explosions because they
understand that that is the job.
They know that this is
what it looks like and
it's what it's gonna be.
Right.
Like, you know, the founder
job, to go back to our fire
analogy, it's something like,
it's, you're really, you're,
you're managing the burn.
Right.
You, by you, you're trying
to control the, the fuel, uh,
which is generally kinda like
what we're focused on within
the startup at a given point.
The oxygen being the amount
of attention you give that,
um, and then making sure
that there are some exits.
IE your, your runway.
So, so this whole thing
is survivable, right?
Like how do we manage
towards some kind of an
outcome in this chaos?
I think that was the other
thing that I realized at, at
some point, probably not nearly
early enough, um, was that
my job wasn't to eliminate
the chaos either, right?
I wasn't trying to do
away with the chaos.
I was trying to leverage
some of the momentum that
existed within the chaos.
To move forward and that was it.
Right?
And then just to be okay, it's
like, oh yeah, my job isn't
to make all of this normal.
It's not going to be right.
Maybe at some point in the
very, in the distant future
when the startup achieves
everything it wants to, yes.
Then, um, but rarely even then.
So
stick with that.
There's all this chaos.
And most founders, uh,
you know, 'cause we, we
advise them all the time.
They'll come to us and say like,
I am, you know, overwhelmed
with chaos right now.
How am I supposed to inspire?
Like, where do I create
this optimism in the face
of so much negativity?
So much negativity.
And, and I wanna talk about
that kinda where that comes
from and, and, and you know,
how we manufacture that.
But I think about
it in terms of, um.
Because we are in the business
of delusion, and everybody
hates that term because it,
it sounds like, it sounds
negative, it sounds false.
It's, you know,
all these things.
I hear accurate.
It probably is.
It's, it is what it is.
Yeah, man.
So, but, but I look
at it and I say.
As a person who has always
lived in a state of delusion,
you know, I've just got a
wild imagination and that's
a big part of this job.
Yeah.
I remember as being like a
9-year-old kid on, in the
summer, I'd wake up and I'd
be like, I wanna build a fort.
Where I grew up in Connecticut,
um, we had lots and lots
of woods, so all the houses
backed up to woods, so,
and I never, isn't it
weird that I still
wake up like that?
Will, I'm not even kidding.
Jack and I saw some stuff from
like a construction project
the other day where they're
like, gutting this building.
We saw this stuff and we stood
there for like 10 minutes being
like, Ooh, we could grab that
stuff, take it over to Park
Levy there, and we could build
a fort, literally designing
this timeless man how to, yeah,
that would've gone over well.
So,
so the moment I woke up
though, the delusion began.
The delusion began, I
pictured the full fortress
that was going to get built.
Okay.
I remember I'd grab graph paper.
I loved this part, right?
This is before SketchUp
existed, and I would sketch
out exactly what the fort
would look like, you know,
in, in, in its purpose.
And, you know, its grand vision.
And I would then go to my, my,
um, the kids in my neighborhood
and I would recruit every
single kid that would listen
and sell them on the idea of
what this fort was going to be.
Where we were gonna source
materials and get them
super pumped about what
their role in the grand
vision would be, et cetera.
I mean, it was
founder 1 0 1, right?
Like, I mean, it's funny that
I was just instinctively doing
that ever since I was a kid.
Yeah.
But.
In my mind when I woke
up that morning, that
fort was already built.
The only difference between
where I was right now and being
there was all the work I had to
do in between to make it happen.
Sure.
But in my mind,
it was a foregone conclusion.
Well stick on that for a second.
'cause I think that's an
important distinction between
founders and most people.
I think that most people
need proof to believe.
Founders, on the other
hand, just need belief to
go and create some proof.
Uh, correct.
Yeah.
As long as we're willing to
believe we will go, we'll,
we'll go prove it, right?
Yep.
Everyone else is sitting
around going, prove this
to me so that I can believe
it, and we're like, that's
not the way I see the world.
It just isn't.
And again, for those folks
that need proof, I get it.
Yeah, I, I get it.
You see this in religion, right?
And that, that is the,
the, the fundamental
difference in religion.
You either have faith
and you believe.
Or you insist on proof and
you don't get it right.
It just, it, it's
one of the two.
And, and, and those are
very polarizing spectrums.
Okay?
Now, for people who believe,
they often not always don't
need to be told to believe,
there's just something in
them that is willing to
manufacture that belief.
And hold onto it very
strongly and, and
clearly around religion.
Nothing has inspired
more humans on the planet
than what is religion.
A belief in something
that that might not be.
And again, I'm not knocking
anybody's religion, I'm just
saying everyone recognizes
that there could be a chance
that, that it isn't what we
think it is, no matter how,
how strong our belief is.
And, but we're willing
to believe anyway.
That is a founder.
The founder says there's,
I can't prove a damn thing.
I have no idea whether this
is gonna actually become
this thing, but I believe so
strongly in the value of what
it could be, that I'm gonna
manufacture all of the optimism
that I've ever had in my
life around this single goal.
And I'm, again, I'm expire.
Lots of people to join,
invest, and all these things.
But at, at some point, and this
is, this is, uh, what I want to
kind of dial into at some point.
Like when it's first
starting, it's just a concept.
There's no consequence yet.
Fast forward three years
in, I haven't gotten paid.
I've burned through all
my personal savings.
I've got a bunch of people
that I can barely keep paid.
Maybe I'm, I'm swinging rope to
rope on, uh, investor checks.
Where the hell am I supposed
to get that optimism now?
Like what does that even
look like at this point?
Yeah, and I think that's where
a lot of people that we talk to,
they're in that spot and they're
like, once the pixie dust of
the big idea ran off, now I
have the reality of what this
thing is and how the hell am I
supposed to draw more optimism
from the reality around me?
You know what
I mean?
Yeah.
I think the future visionally
goes so far, right?
Like you waking up, you waking
up and seeing that for that's
already built, that's great.
Right?
We seeing it as already real.
That's, I think that's
where it, it starts.
For me, it was then always
about kind of like this alchemy
around, uh, minor wins, right?
Like little outcomes that are
signals that, that can kind
of turn into some momentum.
Um, so maybe it's that waking
up and, and and creating the,
the sketch on graph paper.
And so I go like, okay, yes.
So now I can show this to
somebody else and they'll,
they'll be able to see it.
It is closer to the
real that I see and then
getting somebody to agree.
And so it's, it's really about
that series of, of kind of
micro wins and, and leveraging
those together so that you.
Because that's where
it comes from, right?
Like at some point I've met
very, very few founders.
I've met a few who will just
continue with that sort of
like religious level of faith.
Where it's like, I have yet to
see any proof of this, but I
believe in it so strongly that
I'm willing to keep doing this.
I, I keep, I keep running into
nose and walls everywhere.
I'm willing to keep doing it.
Most founders have a limit.
I, I, I would argue
probably all founders have
a limit there somewhere.
Um, but I think that, you know,
where most of us end up either
moving forward, turning back
is when we either do or don't
get those, those little wins.
And for me, it was about
ritualizing them as,
as, as much as I could.
Log them.
Make sure the team who
wins is aware of them,
wins or wins, whoever it
is that I'm certain, right?
So just memorialize them in
some ways and then use that
to, to compound morale within
the team if that's necessary.
Or just even within myself to
like go back and look at it
and go, okay, this actually
has added up to something.
Right?
This isn't, it isn't a
zero yet everybody else is
looking at it going as zero.
I'm still seeing that
future vision, but
there's also some there.
There's a little bit of smoke.
Maybe we don't have
fire yet, but there's
at least something here.
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.
I remember when I was raising
VC for, for my first company,
Uhhuh, that I would eventually
successfully raise for, we were
on 50 investor pitches, of which
every single person said, no.
True.
Every single person said, no.
Now it's never quite that
binary when you're in the
pitches, like there, there's,
you have good pitches
that still end up in a no.
Yeah, yeah.
So you, you kind of manufacture
some optimism from it.
Sure.
But you feel like you got
a little further, you get
some nods on slides that
were just absolute because
flat previously Yeah.
Yeah.
Maybe like, like a third of
those, you know, a, a hard
No, from the, the get go.
Yeah.
A third of those you get to
know later on, and a third of
those are all like, Hey, maybe.
Yeah.
Right.
And so you're manufacturing
the optimism for, for those
ones that, that might, uh,
close even though in, in
the end none of them did.
But then 50, you know, meeting
51, this person was like, this
is the best idea I've ever seen.
Like, uh, you know, shut
up and take my money.
Yeah.
And we're like, huh.
Had we given up in meeting
10, which a rational person
after 10 meetings with, you
know, very, uh, substantial
investors would've been
like, you know, this
probably isn't a great idea.
A rational person wouldn't
have done it 40 more times.
Right.
But we're not rational people.
We're not, and and I, I think
when you try to apply a rational
filter, and, and by the way,
I'm not saying a reasonable
filter, rational filter to, in
my mind, the distinction would
be yes, rational says, look,
I've, I've looked at the data.
The data says Stop doing this.
Okay.
Correct.
Very rational, reasonable
person said, I've
looked at the data too.
It also says, uh, it may not
be probable, but it doesn't
mean it, it can't be done.
Correct.
Right.
You know, I, I reasoned, I've
looked at both and I said,
Hey, chances are we won't
get it done, but there's 10%
chance that we will carry on.
Right.
It's, we've, we've gotten
nothing but No, so far, but
it's not definitive yet that
that's the only answer that
could possibly come back.
Correct.
When I think about, you
know, where this optimism
is coming from, when I think
about where it stems from,
I think you touched on it,
it stems from those little,
those little wins, right?
That, that maybe it's not
a yes, but it's a, maybe.
It's like, well,
shit, we haven't had
a maybe before, right?
When you and I are building
product together, we built
a lot of products over
a long period of time.
We launched a new product, a
new price point, you know, a, a
new feature and one person buys.
Now the weight of that one
person means nothing, you
know, relative to our business.
But it opens the door of hope.
Yes.
And, and we go, ah, if, if
it's one, it could be two.
If it could two, it could be 20.
Yeah.
Right?
Yeah.
It's not zero anymore.
Exactly.
Because zero is a
very specific number.
And I think that optimism
comes from these tiny little
signals that breed hope.
And I think that when, when
people look at hope, I think we
tend to wildly undervalue hope.
I think we look at hope
as this childlike fantasy.
And what I'm saying is that
shred of hope, that shred
of optimism is our business.
Right?
That is literally what, what,
what makes great companies
is that shred of hope.
Yeah.
That shred of possibility.
And when you look back at
so many companies that have
had that like down to the
last, you know, dollar, down
to the, the, the last morsel
moment and they've come back,
the difference was hope.
Now, for every one of
those stories where the
person came back, there's
a thousand of them where
they fell off a cliff like,
uh, Wally Coyote, but yeah.
That's the point,
that's the hope.
That's what changes
it at the same time.
Right.
That's the thing.
You, you gotta, you
gotta play to that point.
That's where it
becomes definitive.
Right, right, right.
I think that's what's, what's
so hard for people who, who
aren't built like this, don't
have this gear, don't have this
mentality to look at and go,
like, why would you wait until
you have absolute undeniable
proof that it won't work?
Yeah.
When you were willing to
continue without any kind of
proof that it might, like,
why does it, why, why are
you so willing on one hand.
To kick that decision down
the road until this, until
you get this like you,
it has to be so highly
specific for you to say no.
But you'll take even, you
know, a, a a a, a little bit
of cent on the wind that says
maybe this is still possible.
And I think it just goes back
to, you know, being willing
to say that like, whatever the
cost and the loss is of this
not working means less to me
than the possibility that it,
that it could, could be true.
If I go back in time, I can even
think of times where like, I'm
not gonna say I lied to myself,
but I definitely intentionally
inflated things, right, simply
because I needed some hope.
Right.
You have to though.
I mean, again, that right,
that is the business, right?
Like there isn't another
version of this where everything
is going so well that your
optimism just comes from
so many high fives, right?
Like,
yeah.
That, that world
literally doesn't exist.
But I think if you've never
done this before and you, and
you're like a, a, a, a rational
person and you, you get your
optimism from positive signals
like that constantly happen.
Then you look at this going.
Why would anybody be optimistic?
Right?
And you see this with
employees that we're not cut
out to be at startups, right?
As soon as the, the funding
starts to go away, or as soon
as the product market fit
doesn't seem certain, they
get the hell out of there.
Like I, I was here when it
seemed like all the signals
were good, but as soon as
they turned negative, I'm out.
And, and frankly, you
should Part company with
that person is fast.
Yes.
Yeah.
Yeah.
They're, they're, they're not,
they're on the wrong boat.
Yeah.
Yeah.
The next thing I would say is
when I talk to people about
this manufacturing optimism,
I think one of the things
that, that we get back is,
well, am I lying to people?
Sure, sure, sure.
Yeah.
Are we talking about dishonesty,
you know, to Is is
my delusional lie.
Yeah.
Yeah.
And,
and here's the answer.
It can be if you
know the answer.
Let me explain the
difference between Theranos,
where, where the founder.
Quite specifically
lied to people.
It's because she knew the
answer was one thing and she
gave them a different answer.
That's called lying.
Yeah.
That's not optimism.
That's lying.
Right?
Yeah.
That's, that's different.
That's called optimism, right?
Or it's not a called optimism.
Optimism is when there's a
chance that it could be true.
Optimism is a bet that
has some odds.
It's not a coverup.
Right.
What she did was a coverup.
Optimism is a bet.
Uh, lying
is a coverup.
Yeah.
She knew the answer was no.
Yeah.
Right.
You know?
Does this product
work currently?
No.
Now, to be fair, if she
had phrased it differently
and she just said Not yet.
Not yet.
Right.
That would be different.
That would be different
There difference Not yet.
Says the answer is no.
It does not work, but it could.
When you do it differently and
you say, yes, it works, and you
knowingly know, it won't even,
even if the hope of course is,
is that, you know, you'll get
it to a working, um, viable
state, that's still a lie.
I think that distinction,
I'll give you a quick story.
There's a guy, uh, that,
that gave me this great story
back in like 2006 or seven.
His name is Matt Coffin and
Matt has started a company
called Lower My bills.com.
Uhhuh like this.
This would've been an early
two thousands kind of darling,
and he sold that for like
three 50 million cash to the
same company that the guy
I mentioned before, Cameron
Porters and Johnny sold price
grabber to both to Experian.
Around the same time I had
met Matt and he was looking to
invest in one of my companies.
Matt was telling me a story
about how in the early days of
lower my bills, he was like,
basically I had to present to
the company the whole, they had
lots of employees at the time.
He presents to the company
that, you know, things are
gonna be awesome, you know,
we're, we're gonna be a big
company, get acquired, whatever.
And then he exits the
meeting, goes in the next
room, and he's like, we
can't make payroll next week.
Right now.
Now lots of founders
have been in that.
In that moment, and it's a cool
story when you go on to sell for
hundreds of millions of dollars.
It's a less cool story when
that's where it ends, right?
Where you just
don't pay everybody.
Right?
Uh, you know, actually a, a
good, you know, I don't want
to get too into this, but like
s was a good example of that.
But in this case, the founder
actually did not know that
they weren't gonna be able
to pay everybody, but ran
into a situation where in,
in very short order, she's
like, I've got 450 people
that I can't pay on Monday.
That is a big problem.
But she also didn't tell them
that they're gonna get paid,
so she didn't lie to them.
She's very honest about it,
but crazy shit like this
happens in our business.
It does.
But again, to your point,
you have to draw that, that
distinction first around
uncertainty versus certainty.
Right.
It, it has to be right.
Honest optimism is okay, right?
Here's the situation, here's
the plan, here's the chance.
Assuming there's a chance.
I think it's when it's,
here's the situation,
here's the plan, and, you
know, there's no chance.
That's where this becomes
problematic, really quick.
Uh, not, not that we get to
pick and choose these things.
All we can do is pick and
choose how we react to 'em, and
I think that's the, the, the
core difference then between.
Honest optimism and
just absolutely, uh, uh,
you know, malfeasance,
one of my favorite lines is in
the, the most recent Deadpool
and, uh, Wolverine finds out
that Deadpool has been lying
to him the entire time, Uhhuh.
And he's like, it wasn't a lie.
It was an educated wish.
It was an educated wish.
And I thought, I thought,
uh, I might print that on
something and hang it somewhere
near, I mean, how mean chef's
kiss to that one, right?
I mean, like Yeah.
Whoever, whoever wrote that
line is an absolute genius.
Yes.
Right.
An educated wish.
Right?
Which I thought an educated
wish was so incredibly well
said and so appropriate.
To what we're talking.
Right.
It fits.
I mean, this
is an educated witch.
It's the new mantra.
Yeah.
Right.
But when I think about that,
and again, the difference
between being like just blindly
optimistic and being dishonest.
Right.
Because being dishonest is,
is is very different, right?
Yeah.
When I look at this
optimism that that isn't
the truth, but isn't lying.
The difference, like I said,
is if you know the answer is
one thing without question,
then any other answer is lying.
But if there's a chance
that that might not be
true, then it's usually
grounded in optimism.
For example, every founder
that's ever gonna raise
money has to go through
this employee comes to them.
I heard things aren't going so
well with this funding round.
Are we gonna be able to,
uh, you know, make payroll
in two months, so to speak?
How, however, they,
uh, verbalize that.
Sure.
And you say, yeah.
Now, are you lying?
Yes.
If you know for sure
that, that you can't
raise more money, right?
Yeah.
The problem is you don't
know that for sure.
The problem is you don't, right?
You're still talking
to a few people.
There's maybe one thing,
you've got a deal in the works,
you've got this partnership,
you know, something like that.
And so if you were just
say, yep, nobody's getting
paid in two months, then at
that point you pretty much
cancel any chance that you
would ever save this year.
Yeah.
And everybody goes into
this gray area somewhere
between, Hey, I thought
this was gonna work, and.
Even now, I don't
believe it's gonna work.
Right, right.
But, but I'm too afraid
to, to own up to what
I, what just happened.
It happened the whole time.
I think, you know, as you're
getting further into those
murkier waters, I think there's
a point at which optimism
starts to work against you.
I, I think at which, yeah,
like we see it when, when we
went out and bought companies.
This was a great example.
Uh, virtual was an example of
that, but, you know, there's
many, many others that we
bought or looked at, and
the founder was like, well,
I still think this swing's
worth a hundred million.
Mm-hmm.
You did $25,000 in
revenue last year.
Right.
You know?
Yes.
But the data, yeah,
yeah.
Right.
Yeah, yeah.
You sure there,
there's a chance.
It's not a good one.
And it's not the vast
likelihood, but yeah, there's,
there's a really small
chance this is worth the a
hundred million, but that's
where, in my mind, that's
where the difference between.
I have some basis for why
this could happen and I'm just
making shit up at this point.
Right.
Yeah.
That's as close to lying
as you can get, which is my
point, I think, where
I start to see it.
So when we get close to
this line between hopeful
and harmful, I think that
there's, there's sort of.
Three components to that.
For me, it's like if
we've got facts sort of
like what do we know?
We got some faith, you
know, what are we aiming
to accomplish here?
And then the fight, which
is what we're willing
to do to make that true.
Like the, the steps that we
believe will get us there.
I think where I start to see
it go wrong is when it falls
back just on the first two.
It's sort of, we know
we're outta money.
But we believe we'll be able to
get more before that payroll's
due in two months, but they
don't have the fight anymore.
They don't know like
what the actual steps
they would go and take.
This is where we're, we're now
running into a real problem.
For me.
It's like if you, if you can
tell me, here's the situation,
it's good, bad, or ugly, here's
what I believe we can go do,
and you can tell me how you
think you're gonna go about it.
You're still on the right
side of the equation.
I think the minute that
last piece disappears
and you go like, well,
I. Don't have the money.
Yeah.
But I really hope
that we'll get it.
But I don't have any
idea from where, how
you're on the wrong side.
You're, you're moving over into
harmful territory at that point.
I agree.
And, and I, I think that's
what I want folks to
understand, that there is a
threshold where the upside
to maintaining that optimism
is actually no longer there.
Right.
And now you're really just
mitigating the downside,
in which case again, yep.
You're starting to get
into Theranos territory,
which I think is a
dangerous spot for sure.
When we talk to founders, and
I can tell they're at the point
of no return, the, the advice
that I give them, and I've given
this to many, many founders,
some of those are listeners
of this show, I've said, look,
you're at a point now where
you're no longer trying to win.
Instead, you're just focused
on trying not to fail,
and, and no one wins with
that strategy and, and it's
time to unwind this thing.
And I basically try to
give them permission.
To let go because at
that point I know their
optimism is a delusion.
Even to them, it's, it's
no longer benefiting them.
Right?
But here's what's
interesting, man.
If we don't have this
optimism, if we don't
manufacture this optimism.
We can't win.
There's no version where
you do what we do based
purely on facts, right?
It just, if, if that's the
business you think you're in,
you're in the wrong business.
Man.
I just saw a clip last
night that illustrates this.
It was from while not sleeping
because, uh, Jack has in
two, has had a cough for two
weeks and, and it only comes
at night to keep us awake.
It's as we've decided
that's what it's for.
But I, I happen to
catch this line.
Do you remember the show?
Whose line is it?
Anyways?
Yeah, I have no idea how deeply,
uh, this thing was buried on
the internet, but this, this
clip resurfaced last night
for me, and the, the prompt
was worst or least inspiring
battle cries and the least
inspiring battle cry was the
guy runs out and he goes.
Oh no.
I was like, yeah, right.
You have to have optimism.
Right, right, right.
You show up at the fight,
you gotta believe you have
some chance of winning,
otherwise you definitely won't.
My favorite example of that,
and you know your battle cry is
perfect, is the opening scene
from Saving Private Ryan, just
telling the kids about this.
Yeah, definitely don't show it
to 'em, but no, exactly that.
They were like,
can we watch it?
I was like, absolutely
not.
I, right.
I remember when I watched
that scene in the theater,
like I was almost sick to my
stomach and, and not because
it was graphic in nature.
That was part of it is
because I, no, no feel
people, the emotional
realization.
Yeah.
Like, holy, somebody
actually did that.
Now, now back that up.
If I recall the scene opens up
with, um, Tom Hanks on a, uh,
you know, one of the loading
boats that's gonna hit the
shores, and his hand is shaking
like he's, you know, trying to
drink or do something to, to
try to like calm his nerves.
Every guy starts throwing up
and everything else like that.
Now I wanna pause there.
This isn't about, about the
movie, it's about optimism.
Okay?
Yeah.
At some point.
Every single person on those
boats had to be convinced that
they were gonna be victorious.
Now, now stick with
that for a second.
They were going
into certain death.
Like there's, there's
absolutely, and I use this
example because it's so stark.
They're going into certain
death, but the only way to be
victorious, which they were.
Was to have a manufactured
optimism to see the world in
a way where they didn't get
shot, to see the world in
a way where they didn't get
butchered, but they actually
made it past the beach and they
made it up to the church, you
know, and, and stopped things.
Let's say, think of
how powerful that is.
Right in the face of
absolute certain destruction.
Someone generals, then
commanders, et cetera,
were willing to like to
manufacture this optimism.
They put together a plan that
said this could work, and
then this is the crazy part.
Convince 156,000 troops.
Yep.
That they should do the same.
Same thing.
Yeah.
I've had some wild
ass ideas in my day.
None of them involved.
And we should run
directly at machine guns.
Yeah.
Like, yeah, I appreciate that.
If that ever does show up
in one of our meetings, I'm,
I'm, I'm gonna let you know.
Now I'm probably, I probably,
I, I won't say a hundred
percent, this is where that
optimism comes in, but I'll,
I'm probably gonna say no.
I will say this though,
in, uh, kind of as an aside,
because we're recording
this after Veteran's
Day, thank you to all the
people that have served.
Yes, Ryan.
I know you feel the same.
The fact that.
That level of bravery
even exists in humans
is bananas to me.
Right.
And the fact that we work
alongside, we live alongside
people who have that level
of bravery is unbelievable.
I saw this great meme
a few years back.
It was just talking about
like kinda the generational
differences and it said
your grandparents were
called the war, A storm on
the beaches of Normandy.
This is during COVID.
You're being called
to sit on your couch.
You'll be okay.
I was thinking of like the
level of bravery generationally.
And I, I always wonder like,
you know, if we are, if we
had that level of call now,
does our generation have that
level of optimism or, you
know, patriotism or whatever
to kind of, to heed that
call kind of different world.
Big question and, and one that
I actually kind of feel a little
ill thinking about answering
and, and let's, let's
hope we'd never answer.
But I, I bring that
up to say two things.
One, thank you for all the
people that, that, uh, ensure
our freedom, but also think
of what optimism can do.
Think, think of how
powerful this tool is.
Like how powerful, like you
can wield this tool, wielding
optimism, you know, in the face.
Certain death in this case,
and again, I know this, you
know, this example is kind of
dark, but sort of the prove
the point to be able to create
and wield optimism to those
types, types of end games that
literally change the world.
That's what we get to do.
Yeah.
Now how we wield that.
Yeah.
Slightly different
stakes in most cases.
Yeah.
But, but we're given
this tool, this, this
thing called optimism.
Ryan, I, I think that when
founders second guess the
value of this optimism, or, you
know, hey, everything's going
shitty, so, you know, why would
I feel anything but shitty?
I'm like, ah, that's, that's
not the way this works.
Right?
Like, your job is to
manufacture that tool, like
to, to wield that tool.
You know what I mean?
Yeah.
Let's, let's circle
back to that.
I'm, I'm gonna stick on
that scene for a second
because there's, there's
a really pivotal point
in that scene where.
There's optimism and it's,
and it's, it's optimism,
but it's balanced well with,
with apprehension and fear
and all of that, right?
Where they're, they're
still in the boat and it's
that moment where the,
the landing gate drops.
Right.
Right.
And I think this is an
important moment, uh, and
sort of an important, uh,
piece of the metaphor here.
Optimism didn't allow
them to win that fight.
It allowed them to get to
that fight so that they had a
chance of winning that fight.
Right.
That's what we're
doing as founders.
We're creating that
optimism so that we get
there and, and we show up.
So that we have that chance
to win, and there is a moment
where then that optimism is
no longer what you need now.
You just have to fight and
fight and fight and try to
get the win, whatever that is,
whatever that micro thing is,
when it's usually not storming
the beaches of normity, it's
usually shipping that feature
or getting that developer that
you shouldn't be able to hire to
say yes or, or bringing on that
investor, uh, who is skeptical,
whatever it is, whatever
today's battle happens to be.
The optimism is what gets
us to, to show up there.
And and believe, and man,
I, I don't know anybody.
No one can out believe a
founder who shows up daily.
And it's that optimism that
gets us to show up daily.
I agree.
And it's that belief
that actually helps us
to accomplish stuff.
It's interesting too
because it doesn't come
from somewhere else.
In other words, nobody
coaches us to be optimistic.
Right.
You either have this gear,
the world is coaching
us to the opposite.
They're like, you
should give up.
You should quit.
This is idiotic.
Absolutely.
Yeah.
Go be safe.
Right?
I mean, that makes total sense.
That is a rational thing to do,
but founders have this ability.
To manufacture optimism in
the face of absolute crazy
odds, but also, and this is
just as crazy to maintain it.
Whereas everyone else, like I
said, that commercial at the
beginning with the Marines,
right, where everyone else
is running the other way,
we're these crazy people that
are willing to suit up and
run straight into the chaos.
And no matter how chaotic it
gets in for as long as it gets,
we're willing to keep doing it.
But here's the thing.
Yeah.
That's our job as founders.
Our job is to wake up every
day, no matter what the day
looks like, and says, I am
going to conquer the world.
It's not false confidence.
It's, it's the
tool that we need.
If we don't shape that tool, if
we don't develop that tool every
day, build on that optimism
and build on that future,
then we don't stand a chance.
If we do in the face of
everything, if we wake up
every day and we're like, I
don't care what the day looks
like, I'm gonna crush it.
I'm gonna change the world.
I'm gonna shape things to the
way I want them to my mold.
That's what a founder does.
That's how we make the
world what it's going to be.
And if we don't do it,
we don't stand a chance.
But if we do, we show up
with that weapon, we can
literally do anything.
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