An interview with Dave Zohrob, co-founder of Chartable podcast analytics
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Hello, and welcome to build your SaaS. This is the behind the scenes story Building web apps in 2022. I'm Justin Jackson from Transistor. And today on the program, I have Dave Zorob who is the founder cofounder of Chartable, which was recently acquired by Spotify. Lots of great discussion in here, especially since Dave chose the venture capital route and Transistor chose the bootstrapped route, and it's Just interesting to contrast those 2 and to talk a little bit about, yeah, the chartable exit, the acquisition, with Spotify, and a bunch of other topics.
Justin:It's a really great episode. I think you'll enjoy it. Let's get into it. Have have you started going into the Spotify office or is the megaphone office remote?
Dave:I go in, like, once a week. Yeah. So it Spotify's work from anywhere. Okay. So they've, like, know, during the pandemic, I totally committed to this, remote culture.
Justin:Got it.
Dave:My understanding is that it was actually pretty different prior to the pandemic. I mean, I obviously wasn't there. So, but, you know, they have this absolutely gorgeous office
Justin:I've been there.
Dave:Downtown Manhattan.
Justin:It's amazing. Yeah. It the the view
Dave:is really amazing.
Justin:Like, the view of the water is I was like
Dave:It's crazy.
Justin:I remember they brought me up to I mean, I'm a country kid. I grew up in this little farm town in Alberta, and, I was meeting a few people there that day. And I've only been I had only been to New York once before that. So I remember just going into that building, and they're like, you're gonna have to Check-in, and so there's, like, security guards, and I had to check-in there. And then they bring me up to another place, in the elevator, and then It's like this massive waiting room, and then they're like, oh, yeah.
Justin:Yeah. And then they check on the computer. They're like, oh, yeah. You're meeting with, Bill, and then you're meeting with okay. Yeah.
Justin:Sure. And then they just tell you to wait. And in my mind, I'm thinking this waiting room is the the office. Like, this is This is it. You know?
Justin:And Yeah. Like, maybe there's some offices on this floor, like, just, like, around the corner or whatever. And and then, I think I met with Bill first, and he's like, alright. Well, let's hop in the elevator. I'm wait.
Justin:There's more floors?
Dave:There's more.
Justin:And he's like, oh, yeah. And so we went up and Wow. Yeah. It just It's just mind boggling to me. The scale for you, is there a little bit of culture shock?
Justin:Because How big was Chartable before?
Dave:For sure.
Justin:Because Chartable's, like, 11 people. Yeah.
Dave:Yeah. So it's obviously Regardless of, like you know, I think, you know, just to be totally clear, like, part of why we ended up with Spotify is that we really felt like there was, like, so much alignment, both from a division perspective. I know this sounds cheesy, but it's, like, actually about people too. Right? Like, we were, like, met a lot of people throughout the Lifespan of our company Yeah.
Dave:Some of whom were serious about buying our company and some of whom weren't. Some of whom were customers, partners, whatever. Yeah. Or these people are great. Right?
Dave:And so, like, You know, the there's tons of alignment on all this stuff, and it's still you know, Spotify, I think now is, like, 8,000 people. Wow. So, you know, there's a little bit of a gap in terms of numbers.
Justin:Yeah.
Dave:Just like a little bit. Like, you know, almost 3 orders of magnitude. So you know? Yeah.
Justin:Yeah. That and and not the going from a small team that's kind of focused on one thing. And even, like, within podcasting, Chartival was focusing on this very narrow Peace. Right? And now you're in a business that is in music.
Justin:It's in producing content. It's in ads. It's like that must be and even within because you're in the megaphone division. Is that right?
Dave:Yes. Yeah.
Justin:So even megaphone's business must be quite multifaceted. There's hosting. There's analytics. There's
Dave:It's So, it's really complex. Obviously, it's like a huge part of Spotify and a huge part of the podcast industry. So, yeah, it's certainly you know, we've only been there for about 3 months, a little over 3 months, and, it's absolutely like a huge learning experience. 1st, like, you know, understanding how stuff works at an organization this large. Yeah.
Dave:Right? Because the last time I worked at a big company was, like, 20 years ago, my 1st job out of college. Right? So, like
Justin:Who who are you working for again?
Dave:I worked at Microsoft right out of school Wow. In Seattle. Yeah. In Redmond, on, Office. So, that was, 2003.
Dave:Right? Yeah. So almost 20 years ago. And, you know, I I didn't, make it all that one there, although I had you know, it was certainly an eye opening experience for, like, a 21 year old to, like Yeah. See how, software gets made of that scale.
Dave:But here, it's, like, it's pretty different. Right?
Justin:Did you work for smaller companies between that, like, Before Chartable?
Dave:I left Microsoft and started a record label, in San Francisco with some friends, and I was doing some, like, consulting and then kind of, like, fell into startups, kinda by accident. Like, that's a watershed for a startup.
Justin:Record label. I I I think you told me this, but It
Dave:was called Tell All Records. Yeah. So it's like a really it was like music label. We put out, like, super weird, like, experimental music, like, sound collage, modern composition
Justin:Okay.
Dave:That sort of thing. We did okay. I think our our number one record I mean, CDs we put out back when people bought those.
Justin:Yeah. Not a bad time to have a record company.
Dave:Yeah. I mean, we sold 1500 CDs of our top selling record.
Justin:There you go.
Dave:That was pretty good. Yeah. Yeah. Yeah. It was a different time.
Dave:I spent all my savings from Microsoft on this thing. And, and then, yeah, I kinda stumbled into startups. You know? I moved to San Francisco to be Hey. Now the friends Yeah.
Dave:And to play music and ended up, you know, started sorta in the air even though it was, like, 2004 when I moved there, and it was kind of the still like that from
Justin:Yeah.
Dave:.Com 1 point o. Yeah. And then I kinda, like, found my peeps. Like, found, you know, people who are building stuff. And, You know, so I worked for this company called Hot or Nops, like, early dating site.
Dave:Yep. I worked for I started a a startup, My first company back in 2007 doing, like, Facebook apps and then iOS apps, like, in the dating social networking space. Yeah. I worked for AngelList for a long time. So AngelList is like a startup, investor network and chatbot.
Justin:That's how I think I first heard of you. Yeah. I was at AngelList.
Dave:Yeah. So I've worked at a few different places, but AngelList at the time I joined was I think I was the 7th person or something. Right? So Wow.
Justin:Okay.
Dave:That was, also you know, pretty much all small companies since. And now, you know, we started Chartable back in 2018 after leaving AngelList and trying to figure out what to build, and, you know, we started the podcast ourselves. I think I told this story the last time I was here, but Yeah. Just for those Yeah. Tuning in Yeah.
Dave:Yeah. You know, My, Harish and I worked together at AngelList. We started this, started together, you know, trying to figure out what to build. We started a podcast summarizing Hacker News, like the Y Combinator News board, and it just kinda took off, and we were like, what is this? Like, why is anyone listening to us?
Dave:Yeah. You know? And that's what led Let us down the wonderful rabbit hole that is podcasting.
Justin:So So you and Harish found Chartable in 2018. Actually, we gotta go back a little bit because,
Dave:chronological and make it all make sense to be honest.
Justin:No. No. No. This will be a meandering, conversation. I might I might give Chris a few notes, but, often, I just often, I just let Chris, our editor.
Justin:He just, he just decides what he thinks is interesting.
Dave:Yes. I also, hello, Chris. We also, hired Chris to edit the charitable podcast back when we were doing it.
Justin:Oh, nice. Best.
Dave:But yeah.
Justin:Chris is awesome. Chris always has these one-sided conversations stations where people are talking to him, but, but he cannot respond. Yes. He's like, oh, that's nice. You know?
Justin:He but he he can't he can't say anything. So you were were you a computer guy in the beginning, or were you just
Dave:was a computer guy. Still am.
Justin:So so because you were, like, a creative music kind of you were into other stuff.
Dave:Only thing I've ever done for work is programming. Right. So, like, when I was I started doing it when I was, like, a really little kid. I don't like, you know, I have I know the stories that my parents tell more than I remember it myself. I do remember, like, our 1st computer.
Justin:Yeah. What was it?
Dave:One of those RadioShack ones I hooked up to the TV. Was it a TRS 80?
Justin:A TRS. Oh, nice.
Dave:Yeah. Program's onto it.
Justin:The funny thing about those cassettes is I I remember we had that on our Vic 20, but you had to type in so much code just to get them
Dave:to load it off.
Justin:It was Yeah. It was like and Even that that idea to me, even today, that a cassette could have data on it is just mind boggling.
Dave:Yeah. So it goes all the way I mean, it's literally the only thing I've ever really done. Yeah. You know, I've always been a a computer an indoor kid, as they say. Yeah.
Dave:And, like, you know, I was coding When I was little, you know, went to school, you know, for computer science. Like, I I did, like when I was in middle school, I was writing, like, programming tutorials and putting them on the Internet Yeah. With my my parents' home address. Yeah. And I think you can still find these, with my parents' home address, in The text files that were the tutorials, you know, saying like, hey.
Dave:If you wanna, like, write me a letter or, like, buy some, like I, like, published a a CDR of All the programs that I, like, had collected from my website, which was p basic.com. Wow. And, yeah, this is, like, 1990 for something. You know? So, like, a while ago.
Justin:And now all those text files are just, like, on Usenet forever or something?
Dave:Yeah. I mean, I think they're still around. My, Good friend, who was, I guess, my best man when I got married, quoted from some of the tutorials, during a speech.
Justin:That's amazing.
Dave:Juicy bits of code I was sharing.
Justin:Wow.
Dave:So you know?
Justin:But you were and you were selling these. So Were you were you in
Dave:Yeah. So I, like, wrote a bunch of tutorials, and I would sell, I sold, like, CDRs of, like, all the code that, you know, people would submit their programs to be featured on the So Yeah. We had, like, a forum with a bunch of stuff that people wrote. And so, yeah, I would sell these CDRs. People would, like, send cash to, like, their house.
Justin:That is amazing.
Dave:Yeah. Wow. And, like, I was early, like, Amazon affiliate, you know, back in, like, 1994, 95. Like, you you know, I think I made it, like, a you know, for I think I was, like, you know, in my early teens, maybe preteen.
Justin:Yeah. It
Dave:was, like, decent money, like, a few $100 here and there. I was like, this is incredible.
Justin:That You know? Like, this That is incredible.
Dave:You've ever seen.
Justin:I wonder do you think like, is that A intuition you just always had that you wanted to make money that way?
Dave:I don't know about money. You know? I I always and still, like, I don't know how much of this is, you know, learned versus just the way I'm my brain is built, but, like, I get my I get my dopamine heads from making stuff. Yeah. The thing I'm pretty good at making I'm, like, much better at making computer stuff than I am in making other stuff.
Dave:I love playing music. Yes. You know? I'm not the best musician in the world or anything. Yeah.
Dave:I think I'm, like, better programmer than I am a musician or much rather, like, product designer. Or I I don't know about designer, but product maker than musician.
Justin:You know? Yes.
Dave:So But
Justin:but what what where does the attraction towards the commerce side come from? Because there's lots of musicians who are fine who don't start a Record label? A record label is the capitalistic manifestation of music. And so what
Dave:I mean, it's certainly a money losing venture. So it it was, in some ways, a nonprofit, not Yeah. Yeah. My choice, but, like, I don't know. There's something about, like, wanting to put stuff in the world.
Dave:Right? And and, like, 1 you know, you need to, like you know, in music at the time, in particular, it felt like a record label was a way you know, record labels that I would follow had, like, very particular brands of the style of music they would release. They would support their artists with marketing and stuff, and we wanted to do that. Right? So, like, There were these, like, small indie labels that I would totally follow and look for every new release that came out and be like, hey.
Dave:Is this good? Not every single one would be good, But, there was, like, there was a vibe associated with that, and so I wanted to create that sort of vibe and put that stuff in the world.
Justin:Are are there records that you released that are on Spotify?
Dave:We the artists, like, own the masters. Right? So I think some of our artists, like my good friend, Liam Singer, who lives in upstate New York, he still has music on Spotify. His earliest records that we put out are not on there. Yeah.
Dave:I don't know that he wants the world to be, like, hearing them right now. You know? We worked with This guy, Scott Solter, who's an amazing record, recording engineer and producer. He has some ambient music that's still on Spotify. This woman who goes by now, She's, like, really big in the New York, like, avant garde music scene.
Dave:I haven't talked to her in, like, 20 years. We put out this record that she made with a friend, you know, in 2004 or something. Right? But, like, she's has a great music career. Right?
Dave:Playing with, like, cool ensembles and stuff.
Justin:It's pretty cool that you you Had that experience, and now in some ways, you're full circle. Now you are you are, working for Spotify, which is big in the music game.
Dave:Yeah. We're kind of, Yeah. Back in the game. Yeah. And I did, like, you know, I did college radio and was, like, the music director of my college radio station.
Dave:So there is a lot of, like, kind of, like, consonants, like, in like, Echoes here between kind of my past interests Yeah. And current interests and future interests. Right? There's, like, music and audio and Tech. Right?
Dave:Computers, and they're all kinda coming together, man. It's all meant to be.
Justin:It's all meant to be. Do do you think everybody has that intuition, though, to want to to go to the entrepreneurship side of the I
Dave:think so.
Justin:You you do or you don't?
Dave:I don't. I don't. What do you think?
Justin:Well, I'm in trouble, on Twitter for this at this very moment, so that's why I'm asking you.
Dave:What's the trouble, man?
Justin:I mean, I'm just exploring some ideas, and I often I explore them in public. And I think
Dave:I admire you for that.
Justin:I think one of the thing that's interesting it'd be good to get your take on it, but I you know, it does seem that, entrepreneurship is interesting even compared to any of those other things you mentioned, Music. Actually, entrepreneurship is very much like those things in some ways. So anybody can pick up a guitar. Anybody can in in these days, anybody can release Music. Anybody can start coding.
Justin:Anybody can release tutorials on the Internet. What's interesting about that compared to other things where there's a lot of gatekeepers is, not gatekeepers. It's what's interesting about entrepreneurship compared to other competitive pursuits like the UFC or the NBA is that I can't just wake up one day and say, I wanna step into the ring with Conor McGregor. Right? I can't just do that.
Justin:Yeah. I can't just one day just run on the
Dave:I don't know who that is, but I assume that's a UFC person.
Justin:Yeah. I'm I The problem is I use this UFC, metaphor the example, and now everyone thinks, I'm, like, into violent Sports.
Dave:Are you a UFC?
Justin:Which I'm not. I I I I'm not at all.
Dave:But But he's a famous person who's a big fighter.
Justin:He's a big fighter.
Dave:And you can't just go fight him.
Justin:That's right. And or You you could maybe. I've well, you you could, but they wouldn't let you. You know what I mean? Like, I can't just run on to the court during an NBA game and say, okay.
Justin:I'm I'm a basketball player now and you know? And but entrepreneurship And music and anybody who wants to be a public programmer person. Anybody can put out their shingle and say, alright. I'm I'm an entrepreneur. Alright.
Justin:I'm a musician. Yeah. Alright. I'm a a programmer who shares stuff on the Internet. And what's interesting about that is we are still competing with people at the highest caliber.
Justin:So you're still competing with LeBron James, but you are you're just some person off the street.
Dave:And Yeah. You're just a guy. I'm in my garage.
Justin:Yeah.
Dave:Making websites, man.
Justin:Yeah. And I find that fascinating partly because The one of the things when when I talk about business, One of the things I kind of explore is I say I think actually in business, you want to look at The survivors though the survivors, the people like, survivorship bias, we actually want that in business Because, statistically, the pool of people who can just put out a a shingle is infinite. Anybody on their tax return can say, well, I'm a sole proprietor, and I lost Yeah. $20 this year. And so if that's true, then we Whenever we're we're thinking about business and we're thinking about how to do business well, we almost have to exclude that group automatically and say, well, we we can't really be thinking too so often, you know, I'll say
Dave:Is this the controversial part where you're, like, trying to, like, kind of separate a certain kind of business from another kind of business or a certain kind of entrepreneur from others?
Justin:I think that's the part that people got sensitive about.
Dave:I can see how people might be sensitive, but I think it's true if only because, like, you know, people's motivations and, like, the desired outcomes are different. It's like, are you even playing the same game? Yeah. So, like, like, to go with the sport metaphor, it's like, are we playing the same sport? Like, if, like, if you're playing, like, entrepreneurship volleyball and I'm playing entrepreneurship Water polo.
Dave:Am I you know, are we should we really be judged by the same, rules?
Justin:Yes.
Dave:Right? And I think that that could apply to, like, somebody's side project that they're doing out of total passion, zero commercial desire
Justin:Yeah.
Dave:Versus, you know, bootstrap business, whose goal is to be profitable or massively profitable Yeah. Versus, like, a venture backed startup whose, Like, plan is to, like, lose tons of money for a while.
Justin:Yes.
Dave:Right? Yeah. Let's, okay. Let's These are, like, very different games.
Justin:Yeah. Let's let's tie let's dig into this a little bit. So For you, when you were starting Chartable outside of your business objective or your, yeah, even your philosophical objective, What was your personal objective? Like, why were you starting it? Why were you making this bet and risking your time and your energy, Etcetera.
Justin:What were you hoping to get out of it personally?
Dave:I think that, if I'm really honest with myself, there's a lot of ego involved. I have been trying to build startups for a long time and had never really gotten Anywhere that I could point to and say, like, I'm super duper proud of that. I did that myself. You know, that said, like, that that's certainly a part of it and probably more than I wanna admit. Another part of it is that, like, like I said, I'm wired to get kicks from putting stuff on the Internet, right, and making stuff that people use.
Dave:When I when we've stumbled upon podcasting as, like, a potential industry to explore, I was just totally shocked that the kind of tools available to creators were you know, I hate to say this word, but I'll use it, like, primitive compared to what's available for other media. Like, you know, I I mentioned earlier, I do you know, I made mobile apps in the early days of the App Store. And really quickly, these, like, very sophisticated tool tools developed for creators to you know, I don't know if we would have called them creators at the time, but developers Yeah. To To make apps and to, like, you know, figure out what's working and to grow them and all that stuff. We were just kinda shocked.
Justin:Tools like App Annie?
Dave:Yeah. App Annie, Flurry, even the early monetization networks like AdMob and stuff all had a big analytics component. Yeah. You know? Because, like, you're putting this app out there, And you had no idea what was happening other than, like, you would get download numbers from Apple once a day.
Dave:Yeah. Right? Yes. So even worse than what podcasting, was when we started.
Justin:Yes. Yeah. Exactly.
Dave:But, you know, quickly, it got super sophisticated, and I think that that helped enable, You know, what is, you know, absolutely massive app economy, and we were hoping to do the same for audio With for podcasting. Podcasting. Right. So I got I like making stuff. Right?
Dave:That's, like, that's ultimately what it comes down to.
Justin:And I wanna get more into that too, but there's still I I gotta I I just wanna sit here for a second because there's, let's do it. There's a I understand the draw to wanna make stuff. I understand that Completely. I also understand the attraction to what seems like an opportunity. Hey.
Justin:There's a wave out there that seems to be, growing, and I wanna take my surfboard, and I wanna paddle out, and I wanna try to catch that wave because it looks like a good wave. Yeah. I can understand all of that. But, you know, for me, I still had to to discuss with my spouse. You know, hey.
Justin:I'm about to embark on this journey and even pretrend pretransistor. Like, why are you doing this? Why don't you just try to Get another job at Microsoft and climb the ladder, and, that might be better. So what what was driving you Personally, why even play this game? Why make these bets in the 1st place?
Dave:I
Justin:mean, I think ego is actually a pretty good answer. That's part of it.
Dave:Yeah. I mean, ego is a big chunk of it, but also, like and and this is they're probably related, but, like, literally, what what makes me happy? Mhmm. Right? What makes me happy is and this has always been the case since I was putting, like, programming tutorials on the Internet, like, you know, 30 years ago.
Dave:Yeah. Right? Making stuff that people use makes me happy, period.
Justin:Yeah.
Dave:And you get to make a lot more stuff when you start a company. You have a much tighter loop between, hey. I have this idea that might be good, and let's find out if it's good, versus, like, the kind of you know, just by its nature, any larger company has more risk. You know? Yeah.
Dave:Like, it's it's risky for them to do something new, and so it has to run through all the different departments and all that stuff. Yeah. Remember when I joined Microsoft, I was supposed to try to fix a bug with, the spell checker That's like a shared component between, like, Outlook and Word and all that Yeah. Office stuff. And they're like, you have to go talk to so and so Over in Word, he owns the dialogue box that contains the spell checker settings.
Dave:Yeah. It's like this guy's, like life's work, basically. Right? Yeah. And I'm like, I don't know that I wanna be that guy.
Dave:Like, I think that's a good thing to own that and to, like, make sure that that dialogue box, That settings panel is really good, and I'm glad that somebody really wants to do that. Right? But for me, I wouldn't get enough Kicks out of it to, like, refine the dialogue box for 20 years. Yes. Right?
Justin:But the and then there's this other iteration on top of that, which is you start this record label, which is fun. You control things. You get to find the artist. You get to do the marketing. But there was part of that that was not, satisfying because you say it didn't make very much money.
Dave:Yeah. I mean, I spent all the same money I'd saved up, and, we weren't able to do it anymore because we ran out of money. Right? You know, going back to the idea of the different paths. Right.
Dave:Side project versus bootstrap versus, like, a venture. And these are not the only options, but there are a few of the many available options for making something on the Internet. It was not sustainable for something to just keep eating money. Yeah. And there's no way that anyone was gonna invest in our art label.
Dave:I didn't even think about it.
Justin:Yeah. Yeah. Yeah. Yeah.
Dave:So, like, what's the goal? What's, you know, what you know, I was too young to have, like, really thought it through. We just thought it would be something cool to do and something fun to work on with friends. Yeah. Right?
Justin:Well, I mean, I and I've been I've been there. I I know that feeling. I think one thing I'm just and I think this all as we get into this kind of funded versus bootstrap conversation. It'll be interesting, but the again, the thing about business, if anybody can put out a shingle and then try it, which is great, I I think what you quickly learn is that you're doing this for reasons. I wanna be creative.
Justin:I wanna have freedom. I want to have people use the things I make. I want to you know, all those things. And it's very likely if I was independently wealthy. Like, if I was just a trust fund kid or something, Maybe I wouldn't start businesses because maybe if I could just create things, I would be, okay with it.
Justin:What do you think? Do you think for you, you if the economic incentive wasn't there, you would have Been okay to just keep creating things if you knew you just had enough money?
Dave:It's hard to say. Right? So I'm not a trust fund kid. You know? And so, like, obviously, like, wanting to make money as part of it.
Dave:But, like, money is definitely not my primary motivator. It just isn't I could've I would've made Many different decisions all throughout my career, if you even wanna call it that. That, if money were my primary motivator. I've left great jobs a bunch of times because, like, it wasn't you know, I felt like I had something else to a a different itch to scratch. Yes.
Dave:I guess we'll see. I I you know, life is long. Right? You know, this was an amazing outcome for me and for my team, but I'm not done yet. Right?
Dave:And so the motivations are different. It's not the same as, like, literally thinking that this is, like, life or death. Obviously, it wasn't life or death. It's just making A website on the Internet and trying to sell it. It felt so intense, especially the kind of the last year, year and a half of Chirtebral's independent existence, really trying to fulfill what I saw as its potential.
Dave:Yeah. It felt like this, like, imperative, and a lot of that, you know, is economic. Right? But, also, just, like, deeply personal. You know?
Dave:Deeply it's about my own baggage as a maker of things and as a person existing in the world that I felt like I really had to do this. Yes. Right? Yeah. And do I feel like I still have to do it?
Dave:Yeah. I do. Like, I'm I'm broken in that way. Right? Like that, you know, if I were to be done you know, I'm, we have a a lawn a lot of work to do at Spotify.
Dave:Yeah. Whenever that work is done, you know, I don't think I'm just gonna, like, go chill on a beach for 5 years. Like, I'm gonna just gonna go do something else go make something else. Right? I don't know that I could help that.
Dave:Yeah. You know? Even if I, like, thought that it was, like, irrational, which I think it is irrational to do, I'm still gonna probably do it because that's just that's how at this point, that feedback loop of of wanting to make something and seeing it made and seeing people use it and trying to make it better and trying to sell it and trying to learn. Mhmm. That's that's That's my that's my loop.
Dave:I'm addicted to it. Right? That's what I wanna do.
Justin:And and your comment about the timeline is so interesting because one one of the things that was Interesting when you and I met was we were on this path where our timelines were adjacent. And but we had We got to see the the flux of that. Right? And, of course, life is still playing out. So I got to watch you make bets, and you got to watch John and I make bets.
Justin:And At different times, it felt like, you know, like, at the beginning, you had raised money. And so you And you and I talked about this. It's very it's kind of like at that point when you raise I think you raised 1.3 initially. Is that right?
Dave:Yeah. It's like, yeah, almost 1a half. Not quite 1a half.
Justin:So you raised 1a half, and it's like you had chosen a path because at that point, You know, getting to 20 k MRR wasn't like, that wouldn't be good enough. Like, you had to keep you had you had a different path. Correct?
Dave:Yeah. There was there was a point you know, we had thought that we were gonna, like, try to bootstrap it bootstrap it, meaning, like, we didn't even know what we were building. Bootstrap our company, right when we quit our jobs at AngelList. But when we fell down the podcast rabbit hole, we just thought, like, man, this opportunity is just so dang big. And it would be foolish not to be more aggressive.
Dave:That was our thought at the time. Now I will say that's not the only path. That's the path that we chose. I'm incredibly impressed by what, you and John have built. And there's a lot of other folks building and podcasting that have been building their own way, whether that's a venture way or, Angel Way or a self funded way, whatever way it is or as a side project.
Dave:Right?
Justin:Yeah.
Dave:You know, these are all totally valid paths. Yes. We chose a particular path. And once we chose, we had to commit. Yeah.
Dave:Right? There's, like, snow going back. Right? So that certainly changed what our company's journey What's that? And in the end, we have an outcome that I think we can all be very happy with.
Dave:Was it the, you know, absolute, you know, World changing 10 bazillion dollar outcome? No. But was it, like, a a really important change for us and a great positive outcome for our team and our investors. Yeah. And that's great.
Dave:You know? And I'm really proud of that.
Justin:Yeah. Well, you should and you should be. I think that That's what I liked about talking to you is because the it was like I could see I mean and and there was times where I could see Dave's approach is is Probably better. Like, at the beginning, when John and I were suffering and, you know, John's still working a full time job. I had my own stuff going on, but I'm really putting all my time and energy into transistor.
Justin:And so I had money stress, and John had time stress. Because now it's easy to, like, gloss over that in the past, but it's very likely
Dave:The initial pain.
Justin:Well, the initial pain, it's it's very likely we might not have made it through that. And I think, when I've talked to other folks who have raised money, AD Pinar is another one who who he's saying He bootstrapped initially WooCommerce, and then everything he's done since, he said, I'm never bootstrapping again because it's not fair to my family. The the idea that I would be running this thing on fumes and hoping to make it through this ring of fire unscathed is just it's too much to ask.
Dave:There was a huge cost, You know, for me, personally, for my, you know, my wife and my kids and stuff, like, it was like, you know, to deny that, I think, would be, you know, Dishonest. Right? It was absolutely a huge cost. My wife you know, you had mentioned talking to your spouse about, like Yeah. Before starting to register that it's, like, a big change.
Dave:And and we talked it through, and We had some timelines and, like, you know, given that we had a good outcome, it all made sense. In the retrospect, it was also a great idea. Right? Way to go. It Absolutely different way.
Dave:Right? And it would have been it would have felt very different. And even you know, especially at the end, like, Going through an m and a process.
Justin:Mhmm.
Dave:It was very stressful, and My kids noticed. Mhmm. Right? And I have 2 like, a 6 year old and a 3 year old. They absolutely noticed.
Dave:Right? So that wasn't around very much. Right? Was here in the garage.
Justin:Yeah. Right?
Dave:Like, all the time. You know, I'd wake up at, like, 5, do some work, go in at 6:30, and get my, older daughter ready for school, Walk her to school. Come back. You know? It's just like it was like there's some months some weeks months of, of our total grind.
Dave:Right? But in retrospect, totally worth it.
Justin:Do do you think raising money made the personal side, family side less stressful because were able to pay yourself a salary from the beginning?
Dave:Yeah. It definitely did. I mean, we had a kind of built in checkpoint. I personally had 1 because we knew that we wanted to have a 2nd child.
Justin:Mhmm.
Dave:And either I would have to have something that was like, I would be okay with committing to bootstrapping and saying, like, hey. We we're gonna bootstrap this, and this is the plan, and then we'll I'll be making extra dollars a month within, you know, 18 months or whatever it is Mhmm. Or raise money or go get a job. Yeah. Those are my options.
Justin:Yeah.
Dave:Right? And And so that's it probably influenced our our decision making a little bit. But, once we were able to raise, like, yeah, like, having a health insurance, which, you know, you know, you guys don't have to worry about, and Canada, but, well,
Justin:we have to worry about it for John. I and and jay we have Okay. We have John and Jason now. And so Helen and I, Helen's in the UK. I'm in Canada, and, I it's a lot easier
Dave:You guys have a cover?
Justin:Lot easier. Like, all All we have to worry about for Helen and I is dental and vision.
Dave:I was paying for COBRA out of pocket for my family, you know, from the time I left Angelus till We raised money. And that was absolutely brutal. Right? It's, like, just totally insane. And I imagine, you know, I imagine has some impact on entrepreneurship in the US because, like Oh, for sure.
Dave:That's, like, 1,000 of dollars a month. You know? Crazy.
Justin:Joe Biden, if you're listening to this, I mean, I'm sure he'd agree. Yes. But, actually actually
Dave:I'm sure he'd agree. Yeah. Is it doable? But yeah.
Justin:To the to those on the other side of the house, if you're listening to this, I I think, yeah, that the greatest gift you could give entrepreneurship, free market economy, like the United States, is health insurance because you want to give people some sort of safety net. And I even starting a business was definitely a massive risk, especially since I've had businesses fail. But if if I knew that if I didn't know that I if one of my kids got sick, I'd be able to go to the hospital, and it wouldn't cost me $30,000 or $100,000 or whatever. I don't think I would have started a business because it's too big of a risk.
Dave:Yeah. Super it is like a a huge impediment. And, like, for us, like, I I basically was paying for, like, COBRA, which is a continuation of, your previous employer's health insurance, and it was just crazy expensive. And this what it was the only way I could make it work. Right?
Dave:It's like, there's really no other option and absolutely factored into, you know, My, like, very scary spreadsheet of impending doom of, like, whether I would have to, like, get a job or, like, give up. You know? And it won't be the same next time. Right? Like, you know, we were fortunate enough to have a a good enough outcome that, if I were do the irrational thing and to try it down at some point in the very distant Yeah.
Dave:Hopefully, very distant future. Ask my wife. She hopes it's also very distant. You know, that it wouldn't be as much of a burden. Right?
Dave:Yeah. But it'd still be hard to you know, it's still just like a massive cost, and a scary thing, you know, with A family to think that, like well, just because, like, dad has a really weird brain. Yeah. And He really likes making things on the Internet in this very particular way. And so he's gonna do this crazy thing, and it's gonna impact you.
Dave:Like, I don't know. It's pretty weird, man. I don't know right now that I when I frame it that way, I'm like, wow. Like, does that the right thing to do? I don't know.
Dave:Yeah. But
Justin:I mean, it's so interesting to think about the In in terms of a bat, because one thing I was just thinking about while you were speaking is In some ways, you pre acquisition and me right now, I think we do have a similar anxiety, Which is most of my potential net worth is still locked up in this company. And Yeah. I think the benefit that Profitable bootstrapped companies have is that if they are doing well, founders can take more money off the table each year just through distributions. But, like, the way I describe it now is especially since this, You know, whatever transistor is, it's it's a it's a I think it's a success for a bootstrap company, but it came to me in my forties. And so I say, I'm I am poor in terms of net worth, but but wealthy in terms of income.
Justin:Right? So It's nice having a higher income, but there's still this feeling of, like, if this goes away, I still have that same anxiety of, like, I haven't taken enough off the table for this to be Fine. Now every year that we keep going, that becomes less and less
Dave:of a
Justin:concern. But The selling your company, you're basically pulling forward. All you're pulling forward years years of revenue in the future, and you're getting it now, and you're able to put it away. Right?
Dave:Yep. Yep. And it's trade off. Right? I mean, you know, for us, it was absolutely the right thing to do, and, like, we really couldn't be happier, about where we ended up and, And our timing and feeling like we have the ability to, like, kind of go even kinda bigger with our vision for, like, publisher tools, right, As part of Spotify?
Dave:But, yeah, they're you know, you wanna talk to anxiety, man. I mean, I was I was a mess. You know? And that that kind of existential dread is is not there in the same way. But now it's like, well, we did this thing.
Dave:Like, we have to kinda make good on all of our promises to customers and all the things that we talked about. Like, we've we've we have all these ideas. We've been doing this for 4 plus years now. I think our I guess our 4 year anniversary of Charter will be, like, next week or something.
Justin:Oh, nice.
Dave:And we have a lot of work to do. And it's just It's very different to get that work done in in the larger environment. There's, like, kind of it's almost like there's more at stake. It's not like there's more at stake for me. Mhmm.
Dave:Like, personally, like, if I screw up, Then, like, my entire income is gonna be destroyed, and my family will be ruined. But, you know, Spotify has really big ambitions for its podcast business. And we're hoping to play a very large part of that, and so we have to do that. Right. It's it's work.
Dave:It's work to be done. And so I've kinda traded one kind of anxiety for another. I'll absolutely take that trade.
Justin:Yeah.
Dave:And now my anxiety is, can we, like, make good on on our promises, make good on on the vision?
Justin:Yeah.
Dave:And, you know, so far so good. It's still early days. Right? But, it's definitely just trading, and this is probably just another way that I'm wired is to worry about something. Yeah.
Dave:Worried about, okay, can we actually follow through?
Justin:Yeah.
Dave:Right? Yeah.
Justin:Can you can you tell me a bit about that transition? When I talked to John about an acquisition, His feeling is like, neither of us has worked for a big company, but we've both worked for companies of a 100, 200 people. And we we like this way more. But every once in a while, I have a thought of, like, Maybe we could see, this is the fantasy, but I I think maybe maybe this is delusional. But Maybe we could, John, maybe we could go to somewhere like Amazon or Spotify or Apple and really kick ass at that level.
Justin:That would be sort of interesting. Yep. How was the transition for you and, you know, your team of being like you're this little unit that can execute at a certain level and you're scrappy and you're, you know, you're doing all the things. Is that transition Difficult going from small company to big company. Do you feel more empowered?
Justin:Like, do you just feel like you've just got a bunch more gas in your tank and now Or they've given you, like, rocket boosters. Like, what's the feeling inside of a bigger company?
Dave:Yeah. It's definitely a different feeling. For me, I think there's trade offs. Right? Like, the the total impacts we can have, if we're able to execute I mean, we are able to execute because we're very capable.
Dave:But, You know, the impact we can have as part of Spotify is absolutely much larger. Spotify has these crazy ambitions, and they've been very public about Yeah. How they want how big they want their ad business to be, and How important podcasting is to that bet. Yeah. Right?
Dave:And, so if you fast forward a few years as, like, you know, they execute on that. They we execute on that plan. Mhmm. You know, the impact is just Ginormous. And, well, Chartable is a small company.
Dave:We were absolutely limited by our resources. We could only do what we could do with our budget and with our, you know, headcounts and Mhmm. We're absolutely getting you know, we have 2 new hires starting next week. We have other open roles. Like, it's really exciting to, like, get a little bit of that rocket fuel.
Dave:Right? Yeah. And the trade off is that I'm not in charge anymore. Mhmm. You know?
Dave:There's a I'm not the CEO of Spotify. Yeah. And, you know, so, like, we're we're Simultaneously, like, trying to, like, step on the gas in terms of, like, what we can do as chartable, but also figure out what it means to exist within this larger company and, you know, we're we're 1 piece of, like, a very big puzzle.
Justin:Yeah.
Dave:Right? So there's there's kind of like there's there's Pluses and minuses. There's, like, things that are harder, things that are easier.
Justin:Yeah.
Dave:The existential dread being gone, that's quite valuable to me. Yeah. Yeah. Honestly, better for my team, better for my family. It's like I don't, you know, don't have to, like, wake up every morning or in the middle of the night, with that, like, sweat.
Dave:Right?
Justin:You're sleeping better?
Dave:Oh, yeah.
Justin:Oh, good.
Dave:Because I I mean, you know, based on where I was at the end, my sleep was extremely poor. Yeah. And so,
Justin:any advice?
Dave:Any advice for sleep? I don't know. You think you want it from me?
Justin:I I mean, I sleep quite well right now. I as soon as trans Good for you, man. As soon as transistor was That's in interesting. I think it's one reason I'm so excited about this idea of, you know, the market provides most of the The the momentum for a company and Yeah. Riding the right wave is so important because the other things I tried, I was able to get to a A place where, you know, this is making enough money for my family to live, and it's great.
Justin:But what didn't go away was Staying up all night, thinking about ideas. What do I gotta launch next? What do I gotta do next? Once transistor was working, I slept way better. I still Yeah.
Justin:Sometimes wake up at 4 in the morning. But it's not with dread. It's more like excitement. It's like, oh, wow. Like, I just get fired up.
Justin:I'm wondering if you have any advice for Other companies that might get acquired in the future, how could what can they do now to prepare to make that due diligence time less of, Nightmare. Or is it just you just gotta go through it? It's just always gonna be difficult.
Dave:You should definitely prepare. You know, for me, I'm not a I'm not a, Trained business person.
Justin:Yeah.
Dave:And so the, financial side of it was something that I had to prepare kind of, like, during During, you know Yeah. In prep for the process and during the process. So all that kind of, like, really boring stuff to me, very boring
Justin:Yeah.
Dave:Stuff Like, having a solid, you know, solid accounting, bookkeeping Yep. Revenue model, tax stuff, Making sure all that stuff is super clean and ready to to share. Mhmm. It's really important. Right?
Justin:Yeah.
Dave:I spent many hours on it when I would would have rather been working on products, kind of because I was, like, cramming it all into a very short time. Right? Not that we hadn't, like, you know, had some books or whatever, but it, like, wasn't It didn't feel as important, you know, to me when I was, like, flying on my own.
Justin:So get a bookkeeper.
Dave:Get a really good bookkeeper and pay attention. This is totally, like, way in the weeds. But, like, for example, what you count as, like, cost of goods sold versus, r and d expense. That stuff matters, right, when when people are figuring out how you fit into their financial models.
Justin:What do you count as cost of goods sold with the SaaS business?
Dave:Like hosting. Not all the hosting. Like, hosting for, like, You know, the kind of paid portion of the site K. Versus, like, the marketing site is, you know, marketing expense. Right?
Dave:Got it. So all these kinds of classifications, like, Your kind of financial partners might not necessarily know your biz they don't know your business as well as you do.
Justin:Yeah.
Dave:Right? So, like, knowing what to what to put where, know, some of it is, like, very much cut and dry. This is what the IRS says or this is what, you know, the government says. But a lot of it is like, well, does it mean for your business? Right?
Dave:Mhmm. How do you use this particular piece of software or, this other service to support your customers, right, or to acquire new customers. And then, like, understanding the levers of the business, like how, you know, you seem to know a lot about SEM, for example, So you do a great job understanding how, like, how you can model growth in the future and telling that story
Justin:Yeah.
Dave:Is a is a big piece. And we certainly Had our our own models, but with the kind of level of rigor that, potential acquirers might wanna see is more than you would use internally. Yeah. Right? Having something to guide a product road map is very different than having something to to present to a finance team
Justin:Yes.
Dave:Or to an investor even. Right? You The level of is different.
Justin:How how did you how did you make that process more equal? Because, you know, Spotify's a massive organization. You're a small little team. Did you you just had some a lawyer on your side, some finance people on your side?
Dave:Yeah. We had a great team. We had great lawyer. We hired an investment banker, for, this guy at, and he's great and has been behind a lot of podcast deals Okay.
Justin:Interesting.
Dave:Who really helped us understand the process. You know, we we had all these different partners that supported us, and they would come on come on the calls, when needed. Yeah. But, ultimately, if you're the CEO, It's mostly on here.
Justin:Yeah.
Dave:Right? You're kind of driving the process. It's definitely it's kind of hard to to speak about in the abstract, but, it you know, there's there's plenty of good resources out there. And, you know, for me, it was definitely something that I learned so much by doing. I I feel like I went to business school, in, like, a really short time.
Justin:Yeah. Yeah.
Dave:Learned a lot. Right?
Justin:Yeah. I can see that being stressful.
Dave:That is a understatement of century for.
Justin:So let's talk about podcasting. First, I wanna know, What are you excited about doing with Chartable? What's this next kind of phase look like? And then second, let's talk about the podcast industry in general, where you think it's going, you know, what's what are the next 5, 10 years? So let's let's start with Chartable.
Justin:What are you excited about building now with Chartable?
Dave:Yeah. The big things we're doing as part of Spotify is just doubling down on on building tools for publishers to help them understand and grow audience. Mhmm. And so that's how we fit into the Spotify, picture. And so, We're really excited about, leveraging, like, Mitrephone data, leveraging Spotify data to give publishers a better understanding of what's happening with their shows, Who's in their audience, and and, you know, tools to you know, we have these smart links and smart promos, like web to Podcast attribution, podcast, podcast attribution Yeah.
Dave:That folks use for marketing their podcast every day. We wanna, like, really make those just, like, unstoppable tools. Mhmm. And, we think that leveraging some of the Spotify data to do that will be great. I don't know how much detail I can go to, but, we're we're planning on improving them.
Justin:Will it continue to be agnostic in terms of also providing data from Apple. And is that the plan?
Dave:I can't speak to, like, what Apple's gonna let us do or not do, but our plan is to is to keep, the tool as agnostic as it can be and to offer it to all podcast resume if you don't host that by the phone. Yeah. But, you know, you can imagine that, Spotify has data for what happens on Spotify. So that, like, Our insights into what happens within the Spotify world, will be available to folks who, like, you know, publish their podcast to Spotify, and we'll have, like, extra, you know, extra tools for folks that, the audience that happens on Spotify.
Justin:This this opens up a whole new spectrum of possibility for you because Spotify has demographic data that you've never been able to access before. Right? So, you've got, you know, what they're listening to, what country they're in, age. Like, there's a bunch of other
Dave:Yep.
Justin:You must be really excited about that possibility.
Dave:We're really excited. Right? And it's certainly a process, like, we wanna make sure that we honor, of charitable is, like, contractual commitments to our publishers about and to listeners about privacy. And Spotify has, like, really strong privacy frameworks, like, really intense, processes. Right?
Dave:So there's a lot to do. I wouldn't say that we're done with it, but, you know, we've spent a lot of the first, like, chunk of our time within Spotify by kind of working through Those legal processes, to make sure that, you know, everything is in the clear. But I'm so excited about it. Right? Because, like, we're a data company, and and love putting you know, giving, podcasters data that'll help them Yeah.
Dave:You know, grow their shows. And, We're getting close, man.
Justin:Can you can you tell me a quick like, what's this an example story of this? Like, is it that I'm going to have a podcast, And I'm going to want to know which show I should do a promo swap with, and so you're gonna be able to better better identify The shows that I should do a promo swap with? Like, if you're gonna surface that kind of information?
Dave:That's that's one potential story. Like, I don't know. You know, the in the short term, the goal is just to, like, make things kind of, like, quicker and easier for folks. Like like, for example, like, we we're part of Megaphone. We can make, Like, a lot of chartable customers are megaphone customers.
Dave:Yeah. We can make the, kind of, like, tight integration between Chartable and megaphone that will just make people's Day to day, like, the marketing audience felt like people that had to live Yeah. In chartable and made their lives really easy. And that's what we're shipping in the short term. Got it.
Dave:Right? Just like kind of like, improving the flow is, like, Chartable as an independent company. We have, like, so many steps to get anything done. Yeah. And, you know, for the folks that are within, you the kind of Spotify fold, we can make their their day to day much better.
Dave:But, yes, you can imagine in the longer term, offering folks, like, yeah, Better ways to grow their audience and and leveraging demographic data to do that. Yeah. And, you know, we have to, like, finish finish our processes, like, before I can promise anything. But, yeah, your story is not far off. Like, ultimately, our job is to Help people understand and grow.
Justin:Yeah.
Dave:Right? And promo is just such a big part of growing a show. Yeah. And whether it's promo within your own network, which is like a huge use case
Justin:Yeah.
Dave:Right, or promo across networks, across shows. And it doesn't and it's not just like these gigantic networks that are doing this. It's like even shows getting a modest number of downloads can benefit from promo. Right? So and we wanna make sure that we're serving those folks too.
Justin:Yeah. What, to to end, what do you think are some things about the podcast industry that I'm missing. What do you think I'm That you're missing. What what what am I not seeing as as Indie Bootstrapper Justin, what what am I not seeing that maybe I should be thinking about?
Dave:I don't know how much of your I think there's a big international story, about podcasting, which is not like a hidden secret or anything. Chartable was very US centric. Spotify is a global company
Justin:Yeah.
Dave:And has global ambitions. Right? And so it's it's it's cool to, you know, now that we have more resources and a part of this bigger team to think about what does it mean to serve, audiences and to serve publishers that are outside our, like, very US centric, bubble. And, I think the the growth story for international markets is just, like, amazing.
Justin:Yeah.
Dave:Right? And there's all kinds of challenges to serve them. Right? There's language challenges. There's like, is the ad market there?
Dave:Like, All these different things. Right?
Justin:Mhmm.
Dave:But as far as something I'm really excited about, and that would have been super hard for us, and maybe hard for you guys as a bootstrap company, like international, I think absolute mega trend Yeah. Over the next, like, 5 to 10 years. Right? And will be interesting to see how it plays out.
Justin:Yeah. That's interesting because now you have this Perspective with Spotify, I always think about the the shrouded ceiling. Like, we know the glass ceiling you can see above you, but the shrouded ceiling is, like, There's just all this world of possibility that you don't even see. And I think the exciting thing for you would be, Again, you get to go into this company and go, oh, well, we've got all this data, and we've we've got all this experience. And, yeah, that's fascinating.
Justin:Well, Dave, I'm gonna let you go. Thanks so much, Scott.
Dave:I'm I wish we could keep going. I gotta jump to I wanna just say thank you, for having me on. Congrats to you and John for, all the amazing progress that you've made and the the amazing things that you've built. And, forward to doing it again soon, man.
Justin:Well, congrats to you. I'm I'm really, pleased for you and your team. I I just so glad that, you were able to have that exit. Couldn't have happened to nicer people in the industry, so congrats.
Dave:Very kind of you to say. Thank you very much.
Justin:Alright.
Dave:Thanks.
Justin:Talk to you later.
Dave:Alright. Thanks, Justin.
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